CHART INDUSTRIES INC - 10-K Annual Report

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549
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FORM 10-K

(MARK ONE)

/X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1999
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to

Commission file number 1-11442
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CHART INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)

DELAWARE 34-1712937
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification
No.)
5885 Landerbrook Dr. Suite 150, Cleveland, Ohio 44124
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (440) 753-1490

Securities registered pursuant to Section 12(b) of the Act:

NAME OF EACH EXCHANGE
TITLE EACH CLASS ON WHICH REGISTERED
---------------- -------------------------

Common stock New York Stock Exchange
par value $.01 per share

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes /X/ No / /

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. Yes / / No / /

As of February 15, 2000, the registrant had 23,932,387 shares of Common
Stock outstanding. As of that date, the aggregate market value of the voting
stock of the registrant held by non-affiliates was $65,556,991 (based upon the
closing price of $4.125 per share of Common Stock on the New York Stock Exchange
on February 15, 2000). For purposes of this calculation, the registrant deems
the 8,039,783 shares of Common Stock held by all of its Directors and executive
officers to be the shares of Common Stock held by affiliates.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant's definitive Proxy Statement to be used in
connection with its Annual Meeting of Stockholders to be held on May 4, 2000 are
incorporated by reference into Part III of this Form 10-K.

Except as otherwise stated, the information contained in this Form 10-K is
as of December 31, 1999.

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PART I

ITEM 1. BUSINESS; ITEM 2. PROPERTIES; AND ITEM 3. LEGAL PROCEEDINGS.

THE COMPANY

Chart Industries, Inc. (the "Company" or "Chart") was organized in
June 1992 as a Delaware corporation to serve as a holding company for the
operations described herein. As used herein, the terms "Company" or "Chart" mean
Chart Industries, Inc., its subsidiaries and its predecessors, unless the
context otherwise indicates. The Company's executive offices are located at 5885
Landerbrook Drive, Suite 150, Cleveland, Ohio 44124, and its telephone number is
(440) 753-1490.

The Company's sales for the year ended December 31, 1999 reached $292.9
million, an increase of 27.7 percent over sales of $229.4 million in 1998. The
Company's net loss in 1999 was $36.3 million compared with net income of
$28.2 million in 1998. The 1999 net loss includes the effects of a
reorganization of the Company which resulted from the April 12, 1999 acquisition
of MVE Holdings, Inc. ("MVE"). Excluding non-recurring items resulting from this
acquisition and reorganization, the Company had net income of $4.2 million.
Including MVE's results on a pro forma basis as if acquired January 1, 1998, the
Company's sales and net loss for 1999 would have been $337.8 million and $38.2
million, respectively.

Management anticipates demand for the Company's products in the industrial
gas market will increase over the next several years, driven principally by the
Company's initiatives in supplying equipment to end-user markets, as well as
global industrialization and heightened environmental standards that result in
higher demand for high purity industrial gases, which are generally produced,
stored and distributed in a cryogenic form. The recent mergers of several of the
industrial gas producers have temporarily dampened this demand for new
equipment. The pressures for increased efficiency in the industry, however, are
expected to result in renewed demand for newer equipment and increased service
of existing equipment, both from which the Company is positioned to benefit. In
the hydrocarbon processing market, management expects strong domestic and
international growth, stemming in part from increased global production. Oil
producing countries are newly committed to capturing and marketing flared
methane that previously was a waste product of the production process. This
increased availability of economically priced hydrocarbon, which makes these
products more desirable, will likely demand a new supply of equipment to liquefy
and transport natural gases.

BUSINESS

GENERAL

The Company is a leading supplier of standard and custom-built industrial
process equipment, primarily for cryogenic (low-temperature) applications. The
Company has developed a particular expertise in cryogenic systems and equipment,
which operate at low temperatures sometimes approaching absolute zero (0 DEG.
Kelvin/ -273 DEG. Centigrade/-459 DEG. Fahrenheit). The majority of the
Company's products, including heat exchangers, cold boxes, vacuum-insulated
containment vessels and other cryogenic components, are used in the processing,
liquefaction, storage, transportation and use of gases and hydrocarbons.

SEGMENTS AND PRODUCTS

The Company's operations are organized within three segments: Process
Systems & Equipment, Distribution & Storage Equipment and Applied Technologies.
Further information about these segments is found at Note L to the Company's
financial statements included at Item 8 of this Annual Report on Form 10-K.

2

PROCESS SYSTEMS & EQUIPMENT SEGMENT ("PROCESS")

The Company's principal products within the Process segment, which accounted
for 28 percent of sales in 1999, are focused on the process equipment, primarily
heat exchangers and coldboxes, used by the major industrial gas, natural gas and
petrochemical companies in the production of their products.

HEAT EXCHANGERS

The Company is the leading designer and manufacturer of cryogenic heat
exchangers. Using technology pioneered by the Company, heat exchangers are
incorporated into systems such as cold boxes to facilitate the progressive
cooling and liquefaction of air or hydrocarbon mixtures for the subsequent
recovery or purification of component gases. In the industrial gas market, heat
exchangers are used to obtain high purity atmospheric gases, such as oxygen,
nitrogen and argon, which have numerous diverse industrial applications. In
hydrocarbon processing industries, heat exchangers allow producers to obtain
purified hydrocarbon by-products, such as methane, ethane, propane and ethylene,
which are commercially marketable for various industrial or residential uses.
Heat exchangers are customized to the customer's order and range in price from
approximately $30,000 for a relatively simple unit to as high as $10 million for
a major project.

Management anticipates the return of strong demand for its heat exchangers,
resulting substantially from increased activity in the petrochemical and liquid
natural gas segments of the hydrocarbon processing market. In particular,
management believes that continuing efforts by less developed countries to make
better use of previously flared methane and to broaden their industrial base
present a promising source of demand for the Company's heat exchangers. Demand
for heat exchangers in developed countries is expected to continue as firms
upgrade their facilities for greater efficiency and regulatory compliance. To
ensure adequate capacity for anticipated growth in demand for heat exchangers,
the Company operates two facilities, the larger being in the United States with
a smaller capacity facility in the United Kingdom.

The Company's principal competitors for heat exchangers are Linde, Sumitomo,
Kobe and Nordon. Management believes that the Company is the only producer of
large brazed aluminum heat exchangers in the United States and, with the second
facility in the United Kingdom, has the leading market share in the global heat
exchanger market. Major customers for the Company's heat exchangers in the
industrial gas market include Air Liquide, Air Products, BOC, MG Industries and
Praxair. In the hydrocarbon processing market, major customers include BP AMOCO,
ARCO, EXXON and contractors such as ABB Randall, Bechtel and M.W. Kellogg.

COLD BOXES

The Company is a leading designer and fabricator of cold boxes. Cold boxes
are highly engineered systems used to significantly reduce the temperature of
gas mixtures to the point where component gases liquefy and can be separated and
purified for further use in multiple industrial, scientific and commercial
applications. In the industrial gas market, cold boxes are used to separate air
into its major atmospheric components, including nitrogen, oxygen and argon,
where the gases are used in a diverse range of applications such as the
quick-freezing of food, wastewater treatment and industrial welding. In the
hydrocarbon processing market, the Company's cold box systems are used in
natural gas processing and in the petrochemical industry. The construction of a
cold box generally consists of one or more heat exchangers and other equipment
packaged in a "box" consisting of metal framing and a complex system of piping
and valves. Cold boxes, which are designed and fabricated to order, sell in the
price range of $500,000 to $10 million, with the majority of cold boxes priced
between $1 million and $2 million.

The Company has a number of competitors for fabrication of cold boxes,
including E.S. Fox, Ivor J. Lee, McShane and NAPTech. Principal customers for
the Company's cold boxes include Air Liquide, ABB Randall, BP AMOCO, Bechtel,
Stone & Webster, MG Industries, M.W. Kellogg, ARCO and Praxair.

3

DISTRIBUTION & STORAGE EQUIPMENT SEGMENT ("DISTRIBUTION")

Representing 36 percent of the Company's sales in 1999, the products
supplied by the Distribution segment are driven primarily by the large installed
base of users of cryogenic liquids. The Company's products span the entire
spectrum for transportation, storage and handling of liquids and include the
following:

CRYOGENIC STORAGE TANKS

The Company is a leading supplier of cryogenic tanks ranging in size up to
100,000 gallons. Using sophisticated vacuum insulation systems placed between
inner and outer tanks, these tanks are able to store and transport liquefied
industrial gases and hydrocarbon gases at temperatures nearing absolute zero.
The Company has experienced substantial growth in its storage tank sales as the
demand for liquefied industrial gases and liquefied hydrocarbon gases has
increased. Customers for the Company's cryogenic storage tanks include
industrial gas producers, chemical producers, manufacturers of electrical
components and businesses in the oil and natural gas industries. Prices for the
Company's cryogenic storage tanks range from $5,000 to $500,000. Principal
customers for the Company's cryogenic storage tanks are AGA, Air Liquide, Air
Products, BOC and Praxair. The Company competes chiefly with Harsco for
cryogenic storage tank customers.

LIQUID CYLINDERS

The Company is a leading supplier of liquid cylinders ranging in size from
50 gallons up to 1,000 gallons. Liquid cylinders are used extensively in the
packaged gas industry to allow smaller quantities of liquid to be easily
delivered to the customers of the industrial gas distributors. Principal
customers for the Company's liquid cylinders are AGA, Air Liquide, Air Products,
BOC and Praxair. The Company competes chiefly with Harsco for liquid cylinder
customers.

TRANSPORT EQUIPMENT

The Company supplies numerous products used for transporting cryogenic
liquids including railcars, intermodal containers and small truck-mounted units
such as the Orca-TM- Micro-Bulk delivery system. The Orca-TM- Micro-Bulk
delivery system has revolutionized traditional distribution by efficiently
introducing on-site filling technology. A typical fill can take three minutes
from the time the driver comes to a stop until the no-loss fill automatically
terminates. The Orca system allows assets to be used more fully, reduces labor,
eliminates empty-for-full exchange and significantly reduces distribution costs.

CRYOGENIC SERVICES

The Company acquired a group of privately held companies, collectively known
as Northcoast Cryogenics, in March 1999. This business now operates as the
Company's Cryogenic Services Division. The Company offers seven locations to
provide installation, service and maintenance of cryogenic products including
storage tanks, liquid cylinders, cryogenic trailers, cryogenic pumps and
vacuum-insulated pipe. The Company's national service network is unique in the
industry, and the Company believes this network provides a significant
competitive edge. The Company anticipates the demand for full service, national,
qualified maintenance of cryogenic products and installations will increase.

APPLIED TECHNOLOGIES SEGMENT ("APPLICATIONS")

The Applications segment, which accounted for 36 percent of the Company's
sales in 1999, consists of various product lines built around the Company's core
competencies in cryogenics but with a focus on the end users of the gases
instead of the large producers and distributors. The Company's products in the
Applications segment include the following:

4

BULK LIQUID CO(2) CONTAINERS

This product line consists primarily of vacuum-insulated, bulk liquid
CO(2) containers used for beverage carbonation in restaurants, convenience
stores and cinemas. The Company also manufactures and markets non-insulated bulk
flavored syrup containers for side-by-side installation with its CO(2) systems.
The Company's beverage systems are sold to food franchisers, soft drink
companies and CO(2) distributors.

The Company's primary competitors for its bulk liquid CO(2) beverage
delivery systems are producers of high pressure gaseous CO(2) systems and
sellers of bulk liquid CO(2) beverage systems. The Company believes that
competition for bulk liquid CO(2) beverage systems is based primarily on service
and price.

MEDICAL PRODUCTS

The medical oxygen product lines include a limited range of medical
respiratory products, including liquid oxygen systems, ambulatory oxygen systems
and oxygen concentrators, all of which are used for the in-home supplemental
oxygen treatment of patients with chronic obstructive pulmonary diseases, such
as bronchitis, emphysema and asthma. The Company also manufactures and markets
patient information systems, consisting of both electronic hardware and
software, which allow its customers to monitor system performance and patient
compliance.

Individuals for whom supplemental oxygen is prescribed generally purchase or
rent an oxygen system from a home healthcare provider or medical equipment
dealer. The provider/dealer or physician usually selects which type of oxygen
system to recommend to its customers: liquid oxygen systems, oxygen
concentrators or high pressure oxygen cylinders. The three methods are currently
believed to be therapeutically equivalent.

The Company believes that competition for liquid oxygen systems is based
primarily upon product performance, reliability, ease-of-service and price and
focuses its marketing strategies on these considerations.

MAGNETIC RESONANCE IMAGING ("MRI") CRYOSTAT COMPONENTS

The basis of the MRI technique is the magnetic properties of certain nuclei
of the human body which can be detected, measured and converted into images for
analysis. MRI equipment uses high-strength magnetic fields, applied radio waves
and high-speed computers to obtain cross-sectional images of the body. The major
components of the MRI assembly are a series of concentric thermal shields and a
supercooled magnet immersed in a liquid helium vessel (a "cryostat") that
maintains a constant, extremely low temperature (-452 DEG. Fahrenheit; 4 DEG.
Kelvin) to achieve superconductivity. The Company manufactures large cryostats,
various cryogenic interfaces, electrical feed-throughs and various other MRI
components that are used to transfer power and/or cryogenic fluids from the
exterior of the MRI unit to the various layers of the cryostat and
superconducting magnet.

The Company currently sells all of its MRI cryostats to General Electric
Company ("GE") and is the exclusive supplier of GE's cryostats. GE is the
leading worldwide manufacturer of MRI equipment.

BIOLOGICAL STORAGE SYSTEMS

This product line consists of vacuum-insulated vessels used by the beef and
dairy cattle breeding industry to transport frozen semen and embryos and
vacuum-insulated vessels used by hospitals, medical laboratories and research
facilities to transport and store human organs, tissue samples and other
temperature-sensitive biological matter.

5

These products are sold through laboratory product original equipment
manufacturers ("OEMs"), laboratory product distributors, industrial gas
distributors and breeding service providers. Many of these distributors provide
a single source for many different types of products to hospitals, medical
laboratories and research facilities.

The Company's competitors for biological storage systems include only a few
companies inside and outside the United States, including Harsco. Competition
for biological storage systems is based primarily on product design, reliability
and price. Alternatives to vacuum-insulated vessels include mechanical,
electrically powered refrigeration for storage of biological matter.

LIQUID NATURAL GAS ("LNG") ALTERNATIVE FUEL SYSTEMS

This product line consists of vacuum-insulated containers for LNG storage
and fueling systems for centrally fueled fleets of vehicles powered by LNG, such
as fleets operated by metropolitan transportation authorities, refuse haulers,
railroads and utilities. Competition for LNG fueling and storage systems is
based primarily on product design, customer support and service, dependability
and price. Although there are alternatives to LNG fuel, the Company is not aware
of any alternatives to vacuum-insulated containers for LNG fueling and storage
systems.

NITROGEN INJECTION SYSTEMS

This product line consists of injectors used by the bottling industry to
give enhanced storage characteristics to non-carbonated beverages such as iced
tea, water and juices.

VACUUM-INSULATED PIPE

This product line specializes in the design and fabrication of custom
cryogenic piping ("VIP") for liquid nitrogen, oxygen, argon, helium and hydrogen
in pipe sizes ranging from 1/4" to 14". The configuration of VIP is built to
order and is restricted only by shipping and installation constraints.
Approximately 50 percent of VIP is supplied as fuel transfer piping to space
launch facilities. Launch pad construction is at an all time high to service
increased launch demand for satellites driven by growth in telecommunications,
global positioning, scientific observation and defense applications. The Company
provides unique design, production and installation capabilities. The Company's
equipment is employed on every launch facility in North America. Competition for
VIP is based on technology (foam vs. vacuum insulation), price and delivery lead
times.

The Company is developing new technologies for insulated piping that will
expand applications for the Company's VIP. Python-TM- piping is sold as an
alternative to modular foam insulated piping for thermally sensitive liquids,
process fluids and beverage production. Large bore vacuum insulated piping is
being developed for sale to LNG production and receiving terminals.

THERMAL VACUUM TEST CHAMBERS

The Company designs and manufactures thermal vacuum systems marketed to a
customer base that includes the aerospace industry, government agencies,
universities and national research facilities. The Company is a leading domestic
supplier of space simulation systems and other types of test chambers used to
test satellites and electronic components. The Company also manufactures large
vacuum chambers for telescope mirror aluminizing, a process in which aluminum is
vaporized to coat the surface of a large telescope mirror to restore its
reflectivity. Management believes that the Company, as a pioneer in the
development of this technology, has supplied the majority of these systems
worldwide. The Company's major competitors in the market for thermal vacuum
products and systems for aerospace and research applications include Qualmark,
Tenney Vacuum and Bemco.

6

The Company's experience and technological advancements in the high-vacuum
area resulted in its involvement, beginning in 1995 and concluding in
December 1998, in equipping the Laser Interferometer Gravitational-Wave
Observatory ("LIGO") project, a scientific research project sponsored by the
National Science Foundation and jointly managed by the Massachusetts Institute
of Technology and the California Institute of Technology. The observatories are
dedicated to the detection and measurement of cosmic gravitational waves and the
harnessing of these waves for scientific research. The Company supplied all of
the required LIGO vacuum equipment, including vacuum chambers, large pipe
spools, valves, vacuum pumps, controllers and modular clean rooms. Management
believes that expertise in the field of high vacuum technology developed by the
Company through its involvement in the LIGO project may have a number of new
commercial applications.

CRYOGENIC AND NON-CRYOGENIC COMPONENTS

The Company's line of cryogenic components, including high-pressure
cryogenic pumps, valves and specialty components, are recognized in the market
for their reliability, quality and performance. These products are sold to the
Company's heat exchanger and cold box customers in the industrial gas and
hydrocarbon processing industries, as well as to a diverse group of customers in
those and other industries. The Company competes with a number of suppliers of
cryogenic components, including Cryogenic Industries, CCI and Acme Cryogenics.

The Company also produces small diameter stainless steel tubing for sale to
distributors to satisfy their customers' requirements for quick delivery. The
Company's manufacturing strategy is to focus on custom sizes and smaller
production runs, which management believes gives the Company a competitive
advantage in providing a superior quality product while meeting customer demands
for dependable, fast delivery. With its production and marketing efforts
directed principally to customers relying on prompt delivery, the Company is
able to compete primarily on the basis of service rather than price. Numerous
manufacturers of stainless steel tubing are able to compete with the Company in
this market.

MARKET OVERVIEW

The markets served by the Company's principal products are the industrial
gas and hydrocarbon processing markets. Most of the Company's cryogenic
products, including heat exchangers, cold boxes, cryogenic tanks and cryogenic
components, serve both of these markets.

Management believes that the global expansion of the industrial gas and
hydrocarbon processing markets presents attractive opportunities for growth. To
date, the sources of the Company's international business principally have been
its large domestic-based customers who are aggressively expanding into
international markets, and large foreign-based companies with significant U.S.
operations. In 1999, approximately 34 percent of the Company's sales were
destined for use at job sites outside the United States. To position the Company
to take advantage of anticipated growth opportunities in the industrial gas and
hydrocarbon processing markets abroad, management recently has concentrated its
efforts on enhancing the Company's international presence by forming the Chart
Europe Division. The mission of this division is to integrate the Company's
European manufacturing ability with its marketing arm.

The industrial gas market is the largest market served by the Company. The
top world producers of industrial gases have been among the Company's largest
customers for each of the last three years. Producers of industrial gases
separate atmospheric air into its component gases using cryogenic processes. The
resultant liquid gases are then stored and transported for ultimate use by a
wide variety of customers in the petrochemical, electronics, glass, paper,
metals, food, fertilizer, welding, enhanced oil recovery and medical industries.
Industrial gas producers use heat exchangers and cold boxes to produce liquid
gases. Cryogenic tanks and components, including pumps, valves and piping, are
also used to store, transport and distribute liquid gases to end users.

7

The hydrocarbon processing market consists of petrochemical and natural gas
processors. Natural gas processing involves the separation and purification of
natural gas for the production of liquid gas end products such as methane,
ethane, propane and butane, and by-products such as helium, which have numerous
commercial and industrial applications. In the petrochemical industry, cryogenic
separation and purification processes are required to produce ethylene (the
basic building block of plastics), propylene and numerous other primary
hydrocarbons having industrial uses. Like the industrial gas market, the
hydrocarbon processing market uses all of the categories of the Company's
cryogenic products in the gas separation and purification processes and the
subsequent storage and distribution of liquid gases. Major customers for the
Company's products in the hydrocarbon processing markets are large multinational
firms in the oil and gas industry, and large engineering and construction
concerns.

An additional subset of the industrial gas and hydrocarbon processing
markets which the Company has begun to emphasize is the cryogenic products end
user equipment market. This market is somewhat independent of the two large
market drivers of industrial gases and hydrocarbon processing. While end user
equipment may be related to these markets in that the products use industrial
gases or hydrocarbons, the market drivers are not the same. Each of the
Company's products in the Applications segment are driven largely by factors
purely related to the end user market such as carbonated beverage consumption,
medical respiratory disease frequency, new developments in MRI usage and a
myriad of other demand drivers.

ENGINEERING AND PRODUCT DEVELOPMENT

The Company's engineering and product development activities are focused on
developing new and improved solutions and equipment for the end users of
cryogenic equipment. The Company's engineering, technical and marketing
employees actively assist customers in specifying their needs and in determining
appropriate products to meet those needs. Portions of the Company's engineering
expenditures typically are charged to customers, either as separate items or as
components of product cost.

COMPETITION

Management believes the Company can compete effectively around the world and
that it is a leading competitor in its markets. Competition is based primarily
on performance and the ability to provide the design, engineering and
manufacturing capabilities required in a timely and cost-efficient manner.
Contracts are usually awarded on a competitive bid basis. Quality, technical
expertise and timeliness of delivery are the principal competitive factors
within the industry. Price and terms of sale are also important competitive
factors. Because reliable market share data is not available, it is difficult to
estimate the Company's exact position in its markets, although the Company
believes it ranks among the leaders in the markets it serves.

MARKETING

The Company's principal operating units currently market products and
services in North America primarily through 169 direct sales personnel, and
supplement these direct sales through independent sales representatives and
distributors. The technical and custom design nature of the Company's products
requires a professional, highly trained sales force. While each salesperson is
expected to develop a highly specialized knowledge of one product or group of
products within a segment of the Company, each salesperson is now able to sell
many products from different segments to a single market.

The Company uses independent sales representatives to conduct its sales in
certain foreign countries which the Company serves. These independent sales
representatives supplement the Company's direct sales force in dealing with
language and cultural matters. The Company's domestic and foreign independent
sales representatives earn commissions on sales, which vary by product type.

8

ORDERS AND BACKLOG

The Company considers orders to be those for which the Company has received
a signed purchase order or other written contract from the customer. Such orders
are included in backlog until recognized as revenue or cancelled. The table
below sets forth orders and backlog by segment for the periods presented.

YEARS ENDED DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
(DOLLARS IN THOUSANDS)

ORDERS
Process Systems & Equipment................... $ 32,087 $ 82,404 $ 98,867
Distribution and Storage Equipment............ 96,722 36,727 30,281
Applied Technologies.......................... 112,528 53,004 50,942
-------- -------- --------
Total....................................... $241,337 $172,135 $180,090
======== ======== ========
BACKLOG
Process Systems & Equipment................... $ 8,165 $ 63,688 $ 79,963
Distribution and Storage Equipment............ 26,372 14,820 20,844
Applied Technologies.......................... 25,891 17,615 26,674
-------- -------- --------
Total....................................... $ 60,428 $ 96,123 $127,481
======== ======== ========

The Company experienced a significant decline in orders from the Process
segment in 1999. This decline was due to the prolonged downturn in new plant
construction caused by industry consolidation, softness in the industrial gas
market, and the Asian economic situation. Orders from the Distribution and
Applications segments increased in 1999 primarily due to the inclusion of MVE,
which was acquired by the Company in April 1999.

All of the December 31, 1999 backlog is scheduled to be recognized as sales
during 2000. The Company's backlog fluctuates from time to time, and the amounts
set forth above are not necessarily indicative of future backlog levels or the
rate at which backlog will be recognized as sales. The increased focus within
the Company on the Distribution and Applications segments will generally reduce
backlog, as products within these segments tend to have shorter lead times.

CUSTOMERS

Ten customers accounted for 35 percent of consolidated sales in 1999. The
Company's sales to particular customers fluctuate from period to period. In
1999, approximately 34 percent of sales were destined to be used in foreign
countries. To reduce credit risk for both foreign and domestic sales, the
Company requires customer advances, letters of credit and other similar
guarantees of payment. For certain foreign customers the Company also purchases
credit and political risk insurance. Management believes the Company's
relationships with its customers are good.

PATENTS AND TRADEMARKS

Although the Company has a number of patents, trademarks and licenses
related to its business, no one of them or related group of them is considered
by the Company to be of such importance that its expiration or termination would
have a material adverse effect on the Company's business. In general, the
Company depends upon technological capabilities, manufacturing quality control
and application of know-how, rather than patents or other proprietary rights, in
the conduct of its business.

9

RAW MATERIALS AND SUPPLIERS

The Company manufactures most of the products it sells. The raw materials
used in manufacturing include aluminum sheets, bars, plate and piping, stainless
steel strip, heads, plate and piping, carbon steel heads and plate and
9 percent nickel steel heads and plate. Most raw materials are available from
multiple sources of supply.

Commodity metals used by the Company have experienced fluctuations in price.
The Company has generally been able to recover the costs of price increases
through its contracts with customers. The Company foresees no acute shortages of
any raw materials which would have a material adverse effect on its operations.

EMPLOYEES

As of December 31, 1999, the Company had approximately 1,641 domestic
employees and 622 international employees, including approximately 775 salaried,
180 union hourly and 1,308 non-union hourly employees. The salaried employees
included approximately 209 engineers and draft-persons and 566 other
professional, technical and clerical personnel.

The Company is a party to three collective bargaining agreements through its
operating subsidiaries. The agreement with the International Association of
Machinists and Aerospace Workers covering 88 employees at the Company's La
Crosse, Wisconsin, heat exchanger facility expires February 3, 2001. The
agreement with the International Brotherhood of Boilermakers, Iron Ship
Builders, Blacksmiths, Forgers and Helpers covering 92 employees at the
Company's Plaistow, New Hampshire, facility expires August 30, 2002. Employees
at the Company's New Prague, Minnesota, facility agreed in early January 2000 to
accept the Company's proposed contract with the United Steel Workers. Since the
acquisition of each of its operating units, the Company has not had any work
stoppages or strikes. The Company believes its employee relations are good.

ENVIRONMENTAL MATTERS

The Company's operations involve and have involved the handling and use of
substances, such as various cleaning fluids used to remove grease from metal,
that are subject to federal, state and local environmental laws and regulations.
These regulations impose limitations on the discharge of pollutants into the
soil, air and water, and establish standards for their storage and disposal. The
Company monitors and reviews its procedures and policies for compliance with
environmental laws and regulations. The Company's management is familiar with
these regulations, and supports an ongoing capital investment program to
maintain the Company's adherence to required standards.

As part of its ongoing environmental compliance and monitoring programs, the
Company is voluntarily developing work plans for remediation of environmental
conditions involving certain of its operating facilities. Based upon the
Company's study of the known conditions and its prior experience in
investigating and correcting environmental conditions, the Company estimates
that the potential costs of these site remediation efforts will not have a
material adverse effect on the Company's financial position, liquidity, cash
flows or results of operations. Expected future expenditures relating to these
remediation efforts are expected to be made primarily within the next 48 months,
as the necessary regulatory agency approvals of the Company's work plans are
obtained. Although the Company believes it has adequately provided for the cost
of all known environmental conditions, the applicable regulatory agencies could
insist upon different and more costly remediative measures than those the
Company believes are adequate or required by existing law. Except for its
continuing remediative efforts described above, the Company believes that it is
currently in substantial compliance with all known material and applicable
environmental regulations.

10

FACILITIES

The Company occupies 25 principal locations totaling approximately 1.9
million square feet, with the majority, approximately 1.8 million square feet,
devoted to manufacturing, assembly and storage. Of these manufacturing
facilities, approximately 1.4 million square feet are owned and 500,000 square
feet are occupied under operating leases. The Company considers its
manufacturing facilities sufficient to meet its current and planned operational
needs. The Company leases approximately 11,400 square feet for its executive
offices in Cleveland, Ohio.

The following table sets forth certain information about the Company's
facilities:

LOCATION SEGMENT SQ. FT. OWNERSHIP USE
- -------- ---------------------- -------- ---------- --------------------

La Crosse, Wisconsin............... Process 134,000 Owned Manufacturing
10,000 Owned Office
5,000 Leased Warehouse
Wolverhampton, England............. Process 133,500 Owned Manufacturing
4,900 Owned Office
Westborough, Massachusetts......... Process 51,900 Owned Manufacturing
33,200 Owned Office
10,000 Leased Warehouse
New Iberia, Louisiana.............. Process 62,400 Leased Manufacturing
Plaistow, New Hampshire............ Distribution 154,000 Owned Manufacturing
10,400 Owned Office
Denver, Colorado................... Distribution 108,900 Leased Manufacturing
15,400 Leased Office
87,200 Owned Manufacturing
16,600 Owned Office
Ottawa Lake, Michigan.............. Distribution 25,200 Leased Manufacturing
Houston, Texas..................... Distribution 22,000 Leased Manufacturing
Holly Springs, Georgia............. Distribution 6,000 Leased Manufacturing
Phoenix, Arizona................... Distribution 2,000 Leased Manufacturing
Olathe, Kansas..................... Distribution 3,200 Leased Manufacturing
Allentown, Pennsylvania............ Distribution 13,100 Leased Manufacturing
New Prague, Minnesota.............. Distribution 200,000 Owned Manufacturing
15,000 Leased Manufacturing
6,000 Owned Manufacturing
16,000 Leased Office
8,000 Owned Manufacturing
Solingen, Germany.................. Distribution 2,600 Leased Office/Warehouse
Decin, Czech Republic.............. Distribution 194,000 Owned Manufacturing
Yennora, Australia................. Distribution 80,000 Leased Manufacturing
Zhangiajang, China................. Distribution 30,000 Leased Manufacturing
Columbus, Ohio..................... Applications 46,200 Leased Manufacturing
5,000 Leased Warehouse
Costa Mesa, California............. Applications 21,900 Leased Manufacturing
Burnsville, Minnesota.............. Applications 91,000 Owned Manufacturing/Office
Canton, Georgia.................... Applications 138,000 Owned Manufacturing/Office
Lonsdale, Minnesota................ Applications 13,500 Leased Manufacturing
Clarksville, Arkansas.............. Applications 82,500 Owned Manufacturing
2,800 Owned Office
Greenville, Pennsylvania........... Applications 2,100 Leased Office
Cleveland, Ohio.................... Corporate Headquarters 11,400 Leased Office

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None.

11

EXECUTIVE OFFICERS OF THE REGISTRANT

Certain information as of December 31, 1999, regarding each of the Company's
executive officers is set forth below:

NAME AGE POSITION
- ---- -------- ------------------------------------------------

Arthur S. Holmes............................. 58 Chairman, Chief Executive Officer and a Director
James R. Sadowski............................ 58 President and Chief Operating Officer
Don A. Baines................................ 56 Chief Financial Officer, Treasurer and a
Director
John T. Romain............................... 35 Controller and Chief Accounting Officer

ARTHUR S. HOLMES has been Chairman and Chief Executive Officer of the
Company since its formation in June 1992, and was President until
December 1993. He also has been President and the principal owner of Holmes
Investment Services, Inc. ("HIS"), a management consulting firm, since 1989.
Mr. Holmes served as President of ALTEC from 1985 through 1989. From 1978
through 1985, he served in a variety of managerial capacities for Koch Process
Systems, Inc., the predecessor of Process Systems International, Inc. ("PSI"),
most recently as Vice President-Manager of the Gas Processing Division.
Mr. Holmes is the co-inventor of the Company's patented Ryan/Holmes technology.
See "Business--Patents and Trademarks". Mr. Holmes holds a BS and an MS in
Chemical Engineering from the Pennsylvania State University and an MBA from
Northeastern University.

JAMES R. SADOWSKI has been President and Chief Operating Officer of the
Company since December 1993. Prior to joining the Company, Mr. Sadowski served
as Group Vice President of Parker Hannifin Corporation's Bertea Aerospace Group
("Bertea") from 1991 to 1993. Prior to his service at Bertea he served in
various managerial capacities at Parker Hannifin Corporation and TRW Inc.
Mr. Sadowski holds a BS in Engineering/Science from Case Institute of Technology
and an MS degree from the same institution in Mechanical Engineering.

DON A. BAINES has been the Chief Financial Officer and Treasurer of the
Company since its formation in June 1992. He also has served as Chief Financial
Officer for HIS since 1989. From 1986 through 1989, Mr. Baines served as Vice
President, Manager of Finance for ALTEC. From 1976 through 1985, Mr. Baines
served in a variety of managerial capacities, most recently Controller, in the
Process/Transport Division of the Trane Company, which included the predecessor
of ALTEC. Mr. Baines is a Certified Public Accountant and holds a BBA in
Accounting from St. Edward's University, Austin, Texas.

JOHN T. ROMAIN has been the Controller and Chief Accounting Officer since
May 1999 and has served as the Company's Controller since July 1993. Prior to
joining the Company, Mr. Romain worked for Ernst & Young LLP in its Audit and
Assurance practice. Mr. Romain is a Certified Public Accountant and holds a BA
in Accounting and Computer Systems from Grove City College, Grove City,
Pennsylvania.

12

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

QUARTERLY STOCK PRICES AND DIVIDENDS

QUARTER
1999 HIGH LOW DIVIDENDS
- ------- -------- -------- ---------

1st $ 9.000 $ 6.375 $.050
2nd 10.750 6.438 .050
3rd 7.875 4.125
4th 5.250 3.375

QUARTER
1998 HIGH LOW DIVIDENDS
- ------- -------- -------- ---------

1st $19.958 $10.750 $.050
2nd 23.292 14.417 .050
3rd 15.938 6.063 .050
4th 9.750 5.125 .050

LIMITATIONS ON THE PAYMENT OF DIVIDENDS

Under the terms of the Company's amended Credit Agreement, the Company is
prohibited from paying any cash dividends with respect to its capital stock
until January 1, 2001. The Company will be permitted to pay cash dividends not
exceeding $7.2 million in any fiscal year after January 1, 2001, only if at both
the time of the payment of the dividend and immediately thereafter there is no
event of default under the Credit Agreement.

RELATED STOCKHOLDER MATTERS

Chart Industries Common Stock is traded on the New York Stock Exchange under
the symbol "CTI". The information in the table above has been adjusted to
reflect the three-for-two split of the Common Stock effected as a 50 percent
share dividend in June 1998.

Shareholders of record on January 31, 2000 numbered 2,091. The Company
estimates that an additional 5,000 shareholders own stock held for their
accounts at brokerage firms and financial institutions.

RECENT SALES OF UNREGISTERED SECURITIES

On March 15, 1999, the Company acquired a group of privately held companies,
collectively known as Northcoast Cryogenics, for approximately $2.3 million in
cash and 102,010 shares of the Company's Common Stock with an aggregate value of
$720,000. Registration under the Securities Act of 1933 was not effected with
respect to the transaction described above in reliance upon the exemption from
registration provided by Section 4(2) of the Securities Act of 1933.

13

ITEM 6. SELECTED FINANCIAL DATA

SELECTED FINANCIAL DATA

(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

YEARS ENDED DECEMBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------

INCOME STATEMENT DATA:
Sales..................................... $292,937 $229,423 $192,249 $148,400 $112,479
Gross profit.............................. 77,381 77,657 61,240 45,002 30,775
Selling, general and administrative
expense................................. 51,455 32,189 25,901 21,457 17,976
Goodwill amortization expense............. 3,670 1,313 305 288 132
Restructuring charge...................... 11,982
Acquired in-process research and
development............................. 22,010
Operating income (loss)................... (11,736) 44,155 35,034 23,257 12,667
Gain on sale of product line.............. 2,505
Net interest expense...................... 15,854 901 350 623 1,858
Income tax expense........................ 3,106 15,039 12,057 7,605 3,746
Minority interest......................... 280
Net income (loss) before extraordinary
charge.................................. (28,471) 28,215 22,627 15,029 7,063
Extraordinary item, net of tax............ (7,809)
Net income (loss)......................... (36,280) 28,215 22,627 15,029 7,063
EARNINGS PER COMMON SHARE:
Net income (loss)......................... $ (1.53) $ 1.17 $ 1.01 $ .67 $ .31
Net income (loss)--assuming dilution...... $ (1.53) $ 1.16 $ .99 $ .66 $ .31
OTHER FINANCIAL DATA:
Operating income before net interest
expense, income taxes and depreciation
and amortization........................ $ 5,173 $ 51,181 $ 38,545 $ 25,965 $ 15,409
Depreciation and amortization............. 16,909 7,026 3,511 2,708 2,742
Dividends................................. 2,370 4,821 3,858 3,002 2,787
Dividends per share....................... $ .10 $ .20 $ .17 $ .13 $ .12
BALANCE SHEET DATA:
Cash, cash equivalents and restricted
cash.................................... $ 2,314 $ 2,169 $ 22,095 $ 9,408 $ 229
Working capital........................... 50,087 25,326 39,476 14,191 17,750
Total assets.............................. 424,570 158,205 128,919 81,196 66,506
Total debt................................ 278,672 11,325 4,468 4,830 14,573
Long-term debt, less current portion...... 259,336 10,894 4,063 4,469 12,566
Shareholders' equity...................... 55,512 93,154 76,457 28,096 18,433

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.

GENERAL

In 1999, the Company experienced a 27.7 percent increase in sales and a
228.6 percent decrease in net income compared with the prior year. These changes
can primarily be attributed to the acquisitions of MVE and Northcoast, the
non-recurring items resulting from these acquisitions (primarily acquired in-
process research and development expense and the extraordinary loss on the early
extinguishment of debt), the subsequent reorganization of the Company and the
continued weakness in the Process segment.

14

The Process segment experienced a significant decline in new orders received
due largely to industry consolidations, fixed asset rationalizations, softness
in the industrial gas market and the Asian economic situation. New orders in
this segment were $32.1 million compared with $82.4 million in 1998. The
Distribution segment continued at a steady pace in 1999 and was helped by the
MVE acquisition, as new orders in 1999 were $96.7 million compared with $36.7 in
1998. The Applications segment was significantly enhanced by the addition of MVE
and strong MRI orders, growing from $53.0 million in orders for 1998 to $112.5
million in 1999. The significant decline in the Company's backlog was also due
to the Process segment, which had backlog of $8.2 million at December 31, 1999.
The Distribution and Applications segments had backlog of $26.4 million and
$25.9 million, respectively, at December 31, 1999.

OPERATING RESULTS

The following table sets forth the percentage relationship each line item in
the Company's statements of operations represents to sales.

YEARS ENDED DECEMBER 31,
------------------------------------
1999 1998 1997
-------- -------- --------

Sales....................................................... 100.0% 100.0% 100.0%
Cost of products sold....................................... 73.6 66.2 68.1
Gross profit................................................ 26.4 33.8 31.9
Selling, general and administrative expense................. 17.6 14.0 13.5
Goodwill amortization expense............................... 1.2 .6 .1
Restructuring charge........................................ 4.1
Acquired in-process research and development................ 7.5
Operating income (loss)..................................... (4.0) 19.2 18.3
Gain on sale of product line................................ .8
Interest expense, net....................................... 5.4 .4 .2
Income taxes................................................ 1.1 6.5 6.3
Net income (loss) before extraordinary item................. (9.7) 12.3 11.8
Extraordinary item.......................................... (2.7)
Net income (loss)........................................... (12.4) 12.3 11.8

SEGMENT INFORMATION

The following table sets forth sales, gross profit and gross profit margin
for the Company's three operating segments.

YEARS ENDED DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
(DOLLARS IN THOUSANDS)

SALES
Process Systems and Equipment............................... $ 82,085 $124,609 $ 93,562
Distribution and Storage Equipment.......................... 105,529 42,558 31,744
Applied Technologies........................................ 105,323 62,256 66,943
-------- -------- --------
Total..................................................... $292,937 $229,423 $192,249
======== ======== ========
GROSS PROFIT
Process Systems and Equipment............................... $ 16,547 $ 47,273 $ 34,040
Distribution and Storage Equipment.......................... 25,313 13,061 9,739
Applied Technologies........................................ 35,521 17,323 17,461
-------- -------- --------
Total..................................................... $ 77,381 $ 77,657 $ 61,240
======== ======== ========
GROSS PROFIT MARGIN
Process Systems and Equipment............................... 20.2% 37.9% 36.4%
Distribution and Storage Equipment.......................... 24.0% 30.7% 30.7%
Applied Technologies........................................ 33.7% 27.8% 26.1%
Total..................................................... 26.4% 33.8% 31.9%

15

YEARS ENDED DECEMBER 31, 1999 AND 1998

Sales for 1999 were $292.9 million versus $229.4 million for 1998, an
increase of $63.5 million, or 27.7 percent. The acquisitions of MVE on
April 12, 1999 and of Northcoast on March 15, 1999 contributed $123.1 million in
incremental sales to the year, improving the sales of both the Distribution and
Applications segments. Principally offsetting these incremental sales were
declines in volume and price resulting in a $42.5 million reduction in Process
segment sales, and a lower volume of vacuum equipment sales resulting in a
$13.7 million reduction in Applications segment sales, compared with 1998.

Gross profit for 1999 was $77.4 million versus $77.7 million for 1998. Gross
profit in 1999 was reduced by $1.2 million for acquired profit in inventory
related to the MVE acquisition and $936,000 for inventory related restructuring
charges, both of which were included in cost of sales. Gross profit margin for
1999 was 26.4 percent versus 33.8 percent for 1998. The significant decline in
gross profit margin occurred primarily in the Process segment, where gross
profit margin declined approximately 18 percentage points. Pricing pressure in
this segment was intense, as the market for Process equipment was very
competitive due to industry consolidations, fixed asset rationalizations and the
overall softness in the industrial gas market. In addition, under-utilization of
capacity resulted in lower margin percentages. Gross profit margin in the
Distribution segment declined approximately 7 percentage points due to lower
prices on cryogenic storage tanks, while gross profit margin in the Applications
segment increased approximately 6 percentage points, primarily due to favorable
pricing on new product sales acquired with MVE.

Selling, general and administrative ("SG&A") expense for 1999 was
$51.5 million versus $32.2 million for 1998, an increase of $19.3 million, or
59.9 percent. Offsetting the $24.9 million additional SG&A costs incurred by
MVE and Northcoast was approximately $5.6 million in overall restructuring
savings and lower sales commissions. As a percentage of sales, SG&A expense was
17.6 percent for 1999, up from 14.0 percent for 1998. The increase as a
percentage of sales largely reflects the lower sales base for the Process
segment and the higher marketing costs inherent in the pursuit of the
Applications segment.

Goodwill amortization expense for 1999 was $3.7 million compared with
$1.3 million for 1998. The increase is attributable to incremental amortization
expense resulting from the MVE and Northcoast acquisitions, where the purchase
prices exceeded the fair values of the net assets acquired.

The Company recorded a net $12.9 million charge in 1999 to restructure its
operations as a result of the MVE acquisition. The charge included a non-cash
portion of $10.6 million to write-off impaired inventory, fixed assets and
goodwill, and a cash portion of $3.1 million for severance and other costs
related to closing a manufacturing facility. In the third quarter of 1999 the
Company reduced the restructuring reserve by $803,000 for charges taken in the
second quarter of 1999 related to certain fixed assets held for disposal that
were subsequently determined to be useable. The Company terminated 188 employees
in 1999 under this restructuring plan. The Company expects it will incur less
than $500,000 in additional restructuring costs to complete its restructuring
plan by the second quarter of 2000.

In allocating the purchase price to the net assets acquired in the MVE
acquisition, the Company assigned $22.0 million to in-process research and
development ("IPR&D") projects, primarily MVE's Drywash-TM- technology, that had
not reached technological feasibility and had no alternative future use. This
amount was recognized as a non-cash expense with no tax benefit at the date of
acquisition. The Company estimates that it will complete and recognize sales
from these projects in 2000.

The Company recorded a $2.5 million gain on the sale of its standard
cryogenic systems product line on proceeds of $3.3 million in cash in the fourth
quarter of 1999. This product line was sold so that the Company's Process
Systems Division could focus on its core coldbox business.

Net interest expense for 1999 was $15.9 million compared with $901,000 for
1998, reflecting interest on funds borrowed to finance the MVE acquisition.

16

The effective income tax rate for 1999 was 12.4 percent compared with
34.8 percent for 1998. The change in the effective income tax rate is due to the
loss incurred in 1999 offset by non-deductible IPR&D expense and goodwill
amortization. Management has determined, based on the Company's history of prior
earnings and its expectations for the future, that taxable income of the Company
will more likely than not be sufficient to recognize fully these net deferred
tax assets.

In the second quarter of 1999, the Company borrowed funds under its Credit
Facility and retired prior to maturity certain debt assumed as part of the
MVE acquisition with a fair value of $119.2 million. The debt extinguishment
resulted in an extraordinary loss of $12.5 million, $7.8 million net of tax.

As a result of the foregoing, the Company incurred a net loss of
$36.3 million in 1999, compared with net income of $28.2 million in 1998.

YEARS ENDED DECEMBER 31, 1998 AND 1997

Sales for 1998 were $229.4 million, an increase of $37.2 million or
19.3 percent over 1997. The largest increase in sales occurred in the Process
segment, with 1998 sales exceeding 1997 sales by $31.0 million, of which
$23.4 million was attributable to incremental sales of brazed aluminum heat
exchangers by Chart Marston.

Sales in the Distribution segment increased $10.8 million over the prior
year, primarily on the strength of industrial gas equipment sales at Cryenco,
which were up $8.2 million.

Applications sales declined by $4.7 million in 1998. Much of the sales
decline in this segment is the result of the winding down of the LIGO project,
which was successfully completed in December 1998.

Gross profit for 1998 increased $16.4 million or 26.8 percent from 1997
levels. The gross margin increased from 31.9 percent in 1997 to 33.8 percent in
1998. As in sales, a large portion of the improvement in both gross profit and
in gross margin came from the Process segment. The most dramatic improvement
came as a result of increased volume and price in the brazed aluminum heat
exchanger market.

Selling, general and administrative expense totaled $32.2 million for 1998,
an increase of $6.3 million from 1997. The increase in SG&A expense is largely
driven by the variable expenses of profit sharing, management incentive
compensation and selling commissions, all of which are closely tied to
profitability and sales levels. In addition, the acquisition of Chart Marston
added $3.3 million of SG&A expense during the nine months its results were
included in the Company's results. As a percentage of sales, SG&A expense
increased from 13.5 percent in 1997 to 14.0 percent in 1998. The increase in
SG&A expense as a percentage of sales in 1998 is partially caused by expenses
related to merger and acquisition activity the Company engaged in throughout the
year.

Goodwill amortization expense was $1.3 million for 1998, an increase of
$1.0 million from 1997. The increase was due to amortization of the goodwill
created in the Chart Marston acquisition.

Net interest expense increased to $901,000 during 1998 from $350,000 during
1997. The increase in interest expense is due to the increase in debt incurred
in connection with the acquisition of Chart Marston.

LIQUIDITY AND CAPITAL RESOURCES

Cash used by operations in 1999 was $5.3 million compared with cash provided
by operations of $30.9 million in 1998 and $22.7 million in 1997. The
significant decrease in operating cash flow in 1999 was due primarily to the
large decrease in operating income from the Process segment and decreases in
customer advances. As orders recover in the Process segment and grow in the
other segments, there could be large fluctuations in cash flows depending on
negotiated payment terms with customers.

17

Capital expenditures in 1999, 1998 and 1997 were $7.0 million,
$10.0 million and $7.1 million, respectively. The Company's 1999 capital
expenditures relate primarily to the Distribution segment, where new equipment
was necessary as a result of the Company's reorganization plan. In 1998, the
Company paid $3.5 million to acquire land and buildings used by its Cryenco
facility. The 1997 capital expenditures relate primarily to the expansion of
capacity at the Company's ALTEC facility, as well as general throughput
enhancing expenditures at the Company's other operations. The Company expects
future capital expenditures to be similar in magnitude to the prior years.

On December 15, 1999, the Company acquired certain assets relating to a
cryogenic repair business operated by Air Liquide America Corporation ("Air
Liquide") for $1.0 million in cash and $2.6 million in rebate credits to be
given to Air Liquide on future sales.

On April 12, 1999, the Company acquired the common stock of MVE for
approximately $9.2 million in cash ($2.2 million net of cash acquired) and
redeemed the preferred stock of MVE for approximately $74.6 million. Finally,
the Company paid approximately $156.1 million to retire MVE's existing debt
obligations and complete the tender offer and consent solicitation for the
12.5 percent senior secured notes due 2002 issued by MVE, Inc., a subsidiary
of MVE.

On March 15, 1999, the Company acquired a group of privately held companies,
collectively known as Northcoast Cryogenics, for approximately $2.3 million in
cash ($2.2 million net of cash acquired) and $720,000 in Chart Common Stock.

On March 27, 1998, the Company, through its wholly-owned subsidiary Chart
Marston, acquired the net assets of the industrial heat exchanger division of
IMI Marston Limited, a wholly-owned subsidiary of IMI plc, for 21 million
Pounds Sterling (approximately U.S. $35.3 million). The Company borrowed
11 million Pounds Sterling (approximately U.S. $18.5 million) to fund the
acquisition.

On July 31, 1997, the Company acquired all of the shares outstanding of
Cryenco, a Denver, Colorado based manufacturer of cryogenic tanks and related
products for the transportation, storage and dispensing of LNG and liquefied
argon, oxygen, and nitrogen. Consideration for the acquisition included the
payment of $19.6 million to purchase the common stock outstanding and certain
warrants of Cryenco, the payment of $685,000 to redeem its preferred stock
outstanding and the assumption of approximately $6.2 million of indebtedness.
The Company also assumed Cryenco's obligations under other warrants, which were
converted into warrants to purchase Common Stock of the Company, and were
recorded in the Company's accounts at an estimated fair value of $436,000.

In order to finance the acquisition of MVE, the Company negotiated a
consolidated credit and revolving loan facility (the "Credit Facility") which
provides for loans of up to $300 million. The Company paid approximately
$6.5 million in fees to establish the Credit Facility. The Credit Facility
provides the agent bank with a secured interest in substantially all of the
property, plant and equipment of the Company. The Company had borrowings of
$265.2 million outstanding under the Credit Facility at December 31, 1999.

As a result of the Company's second-quarter performance, the Company
breached a financial covenant of the credit agreement related to the Credit
Facility. On August 24, 1999, Chase Manhattan Bank, the Company's agent bank,
waived such breach and amended the Credit Facility. The amendment provides for
modified covenants based upon current performance levels, increased interest
rates and the suspension of quarterly dividend payments. The Company paid
approximately $1.2 million to amend the Credit Facility.

The Company completed a stock offering on October 9, 1997. Of the 4,830,000
shares of Common Stock sold, 2,580,000 were offered by the Company and 2,250,000
were offered by certain stockholders. Consideration for the sale of all shares
sold in the offering (excluding underwriter discounts and expenses) was $14.00
per share. The proceeds to the Company from the stock sale were used to repay
the borrowings outstanding under the Company's credit facility in place at that
time.

18

In November 1996, the Board of Directors authorized a program to repurchase
2,250,000 shares of the Company's Common Stock. The amount and timing of share
purchases will depend on market conditions, share price and other factors. The
Company reserves the right to discontinue the repurchase program at any time. In
1999, 1998 and 1997, 104,000, 909,433 and 562,725 shares, respectively, were
acquired under the program, leaving 344,667 shares available for repurchase
under the program.

The Company forecasts that cash generated by operations, borrowings under
its Credit Facility, which extends through March 31, 2006, and access to capital
markets will be sufficient to satisfy its working capital, capital expenditure
and debt repayment requirements and to finance continued growth through
acquisitions.

Dividends totaling $2.4 million, or $.10 per share, $4.8 million, or
$.20 per share, and $3.9 million, or $.17 per share, were paid during 1999, 1998
and 1997, respectively. Any future declarations of dividends are subject to
approval by the Company's agent bank and are then at the sole discretion of the
Company's Board of Directors. No assurance can be given as to whether dividends
may be declared in the future, and if declared, the amount and timing of such
dividends.

IMPACT OF YEAR 2000

In prior years, the Company discussed the nature and progress of its plans
to become Year 2000 compliant. In late 1999, the Company completed its
remediation and testing of systems. As a result such efforts, the Company has
not experienced significant disruptions in mission critical information
technology and non-information technology systems to date and believes those
systems successfully responded to the Year 2000 date change. The Company
expensed less than $1 million in connection with remediating its systems. The
Company is not currently aware of any material problems resulting from
Year 2000 issues, either with its products, its internal systems or the products
and services of third parties. The Company will continue to monitor its mission
critical computer applications and those of its suppliers and vendors throughout
the year 2000 to ensure that any latent Year 2000 matters that may arise are
promptly addressed.

ADOPTION OF THE EURO

Based upon a preliminary evaluation, the Company's management believes that
the adoption of the Euro by the European Economic Community will not have a
material impact on the Company's international operations. The Company's
international operations conduct the majority of their business in a single
currency with minimal price variations between countries.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

In the normal course of business, the Company's operations are exposed to
continuing fluctuations in foreign currency values and interest rates that can
affect the cost of operating and financing. Accordingly, the Company addresses a
portion of these risks through a program of risk management.

The Company's primary interest rate risk exposure results from the Credit
Facility's various floating rate pricing mechanisms. This interest rate exposure
is managed by the use of multiple maturity dates and certain interest rate
derivative contracts. If interest rates were to increase 200 basis points (2%)
from December 31, 1999 rates, and assuming no changes in debt from the
December 31, 1999 levels, the additional annual expense would be approximately
$4.1 million on a pre-tax basis.

The Company has assets, liabilities and cash flows in foreign currencies,
primarily the British Pound Sterling, the Czech Koruna and the Euro, creating
foreign exchange risk. Monthly measurement, evaluation and forward exchange
contracts are employed as methods to reduce this risk.

19

FORWARD-LOOKING STATEMENTS

The Company is making this statement in order to satisfy the "safe harbor"
provisions contained in the Private Securities Litigation Reform Act of 1995.
This Annual Report on Form 10-K includes forward-looking statements relating to
the business of the Company. Forward-looking statements contained herein or in
other statements made by the Company are made based on management's expectations
and beliefs concerning future events impacting the Company and are subject to
uncertainties and factors relating to the Company's operations and business
environment, all of which are difficult to predict and many of which are beyond
the control of the Company, that could cause actual results of the Company to
differ materially from those matters expressed or implied by forward-looking
statements. The Company believes that the following factors, among others, could
affect its future performance and cause actual results of the Company to differ
materially from those expressed or implied by forward-looking statements made by
or on behalf of the Company: (a) general economic, business and market
conditions; (b) competition; (c) decreases in spending by its industrial
customers; (d) the loss of a major customer or customers; (e) ability of the
Company to identify, consummate and integrate the operations of suitable
acquisition targets; (f) ability of the Company to manage its fixed-price
contract exposure; (g) the Company's ability to pass on increases in raw
material prices; (h) the Company's relations with its employees; (i) the extent
of product liability claims asserted against the Company; (j) variability in the
Company's operating results; (k) the ability of the Company to attract and
retain key personnel; (l) the costs of compliance with environmental matters;
(m) the ability of the Company to protect its proprietary information; and
(n) the ability of the Company to satisfy covenants under its Credit Facility.

20

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

REPORT OF INDEPENDENT AUDITORS

To the Shareholders and Board of Directors
of Chart Industries, Inc.

We have audited the accompanying consolidated balance sheets of Chart
Industries, Inc. and subsidiaries as of December 31, 1999 and 1998, and the
related consolidated statements of operations, shareholders' equity and cash
flows for each of the three years in the period ended December 31, 1999. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Chart
Industries, Inc. and subsidiaries at December 31, 1999 and 1998, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended December 31, 1999, in conformity with accounting
principles generally accepted in the United States.

/s/ ERNST & YOUNG LLP

Cleveland, Ohio
February 7, 2000

21

CHART INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

DECEMBER 31,
--------------------------
1999 1998
---------- ----------
(DOLLARS IN THOUSANDS,
EXCEPT PER SHARE AMOUNTS)

ASSETS
CURRENT ASSETS
Cash and cash equivalents................................. $ 2,314 $ 2,169
Accounts receivable, net of allowances of $1,857 and
$775.................................................... 60,236 37,336
Inventories, net.......................................... 50,578 29,803
Unbilled contract revenue................................. 8,582 2,911
Deferred income taxes..................................... 16,411 1,845
Prepaid expenses and other current assets................. 5,229 2,047
-------- --------
TOTAL CURRENT ASSETS........................................ 143,350 76,111
Property, plant and equipment, net.......................... 74,757 40,536
Goodwill, net of amortization of $4,722 and $1,422.......... 177,228 31,568
Other assets, net........................................... 29,235 9,990
-------- --------
TOTAL ASSETS................................................ $424,570 $158,205
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable.......................................... $ 25,102 $ 11,540
Customer advances......................................... 2,765 13,011
Billings in excess of contract revenue.................... 296 2,194
Accrued salaries, wages and benefits...................... 13,106 10,357
Warranty reserves......................................... 8,255 4,374
Other current liabilities................................. 24,403 8,878
Current portion of long-term debt......................... 19,336 431
-------- --------
TOTAL CURRENT LIABILITIES................................... 93,263 50,785
Revolving Credit Facility................................... 18,000 7,250
Other long-term debt........................................ 241,336 3,644
Other long-term liabilities................................. 16,459 3,372

SHAREHOLDERS' EQUITY
Preferred stock, 1,000,000 shares authorized, none issued or
outstanding
Common stock, par value $.01 per share--30,000,000 shares
authorized, 24,423,927 and 24,321,917 shares issued at
December 31, 1999 and 1998, respectively.................. 244 243
Additional paid-in capital.................................. 43,219 43,367
Retained earnings........................................... 17,702 56,352
Accumulated other comprehensive income...................... (661) (358)
Treasury stock, at cost, 606,725 and 755,516 shares at
December 31, 1999 and 1998, respectively.................. (4,992) (6,450)
-------- --------
55,512 93,154
-------- --------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY.................. $424,570 $158,205
======== ========

The accompanying notes are an integral part of these consolidated financial
statements.

22

CHART INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS

YEARS ENDED DECEMBER 31,
---------------------------------
1999 1998 1997
--------- --------- ---------
(DOLLARS AND SHARES IN THOUSANDS,
EXCEPT PER SHARE AMOUNTS)

Sales....................................................... $292,937 $229,423 $192,249
Cost of products sold:
Cost of sales............................................. 213,458 151,766 131,009
Acquired profit in inventory.............................. 1,162
Restructuring charge...................................... 936
-------- -------- --------
215,556 151,766 131,009
-------- -------- --------
Gross profit................................................ 77,381 77,657 61,240

Selling, general and administrative expense................. 51,455 32,189 25,901
Goodwill amortization expense............................... 3,670 1,313 305
Restructuring charge........................................ 11,982
Acquired in-process research and development................ 22,010
-------- -------- --------
89,117 33,502 26,206
-------- -------- --------
Operating income (loss)..................................... (11,736) 44,155 35,034

Other income (expense):
Gain on sale of product line.............................. 2,505
Interest expense--net..................................... (15,854) (901) (350)
-------- -------- --------
(13,349) (901) (350)
-------- -------- --------
Income (loss) before income taxes, minority interest and
extraordinary item........................................ (25,085) 43,254 34,684
Income tax expense (benefit):
Current................................................... 4,325 14,096 12,874
Deferred.................................................. ( 1,219) 943 (817)
-------- -------- --------
3,106 15,039 12,057
-------- -------- --------
Income (loss) before minority interest and extraordinary
item...................................................... (28,191) 28,215 22,627
Minority interest........................................... (280)
-------- -------- --------
Income (loss) before extraordinary item..................... (28,471) 28,215 22,627
Extraordinary loss on early extinguishment of debt, net of
taxes of $4.7 million..................................... (7,809)
-------- -------- --------
Net income (loss)........................................... $(36,280) $ 28,215 $ 22,627
======== ======== ========
Net income (loss) per common share:
Income (loss) before extraordinary item..................... $ (1.20) $ 1.17 $ 1.01
Extraordinary item.......................................... ( .33)
-------- -------- --------
Net income (loss) per common share.......................... $ (1.53) $ 1.17 $ 1.01
======== ======== ========
Net income (loss) per common share--assuming dilution:
Income (loss) before extraordinary item..................... $ (1.20) $ 1.16 $ .99
Extraordinary item.......................................... ( .33)
-------- -------- --------
Net income (loss) per common share--assuming dilution....... $ (1.53) $ 1.16 $ .99
======== ======== ========
Shares used in per share calculations....................... 23,660 24,084 22,336
======== ======== ========
Shares used in per share calculations--assuming dilution.... 23,660 24,426 22,860
======== ======== ========

The accompanying notes are an integral part of these consolidated financial
statements.

23

CHART INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

ACCUMULATED
ADDITIONAL OTHER TOTAL
SHARES COMMON PAID-IN RETAINED COMPREHENSIVE TREASURY SHAREHOLDERS'
OUTSTANDING STOCK CAPITAL EARNINGS INCOME (LOSS) STOCK EQUITY
----------- -------- ---------- -------- -------------- -------- -------------
(DOLLARS AND SHARES IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

Balance at January 1, 1997......... 9,841 $102 $18,118 $14,321 $(4,445) $ 28,096

Net income....................... 22,627 22,627
Dividends ($.17 per share)....... (3,858) (3,858)
Treasury stock acquisitions...... (252) (5,646) (5,646)
Stock options, net of tax
benefit........................ 39 1 469 470
Conversion of Cryenco warrants... 436 436
Three for two stock split........ 4,809 51 (51)
Contribution of stock to employee
benefit plans.................. 31 571 95 666
Stock offering................... 1,720 17 33,649 33,666
Retirement of treasury shares.... (9) (9,987) 9,996
------ ---- ------- -------- ----- ------- --------
Balance at December 31, 1997....... 16,188 162 43,256 33,039 76,457

Net income....................... 28,215 28,215
Other comprehensive income, net
of tax:
Foreign currency translation
adjustments.................. $(358) (358)
--------
Comprehensive income............. 27,857
Dividends ($.20 per share)....... (4,821) (4,821)
Treasury stock acquisitions...... (844) (8,278) (8,278)
Stock options, net of tax
benefit........................ 65 77 706 783
Three for two stock split........ 8,071 81 (81)
Contribution of stock to employee
benefit plans.................. 86 (77) 1,122 1,045
Other............................ 111 111
------ ---- ------- -------- ----- ------- --------
Balance at December 31, 1998 23,566 243 43,367 56,352 (358) (6,450) 93,154

Net income....................... (36,280) (36,280)
Other comprehensive income, net
of tax:
Foreign currency translation
adjustments.................. (303) (303)
--------
Comprehensive income (loss)...... (36,583)
Dividends ($.10 per share)....... (2,370) (2,370)
Treasury stock acquisitions...... (104) (728) (728)
Stock options, net of tax
benefit........................ 4 (23) 31 8
Contribution of stock to employee
benefit plans.................. 249 (847) 2,155 1,308
Other............................ 102 1 722 723
------ ---- ------- -------- ----- ------- --------
Balance at December 31, 1999....... 23,817 $244 $43,219 $17,702 $(661) $(4,992) $ 55,512
====== ==== ======= ======== ===== ======= ========

The accompanying notes are an integral part of these consolidated financial
statements.

24

CHART INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31,
-------------------------------
1999 1998 1997
--------- -------- --------
(DOLLARS IN THOUSANDS)

OPERATING ACTIVITIES
Net income (loss)......................................... $ (36,280) $ 28,215 $ 22,627
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:
Loss on early extinguishment of debt.................... 12,459
Acquired in-process research and development............ 22,010
Acquired inventory profit............................... 1,162
Restructuring charge.................................... 9,790
Gain on sale of product line............................ (2,505)
Depreciation and amortization........................... 16,909 7,026 3,511
Minority interest....................................... 280
Deferred income taxes................................... (5,449) 943 (817)
Contribution of stock to employee benefit plans......... 1,308 1,045 666
Increase (decrease) in cash resulting from changes in
operating assets and liabilities:
Accounts receivable................................... (462) 3,807 (323)
Inventory and other current assets.................... 1,618 (2,895) 126
Accounts payable and other current liabilities........ (14,110) (1,666) 4,325
Billings in excess of contract revenue and customer
advances............................................ (12,012) (5,541) (7,402)
--------- -------- --------
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES....... (5,282) 30,934 22,713
INVESTING ACTIVITIES
Capital expenditures...................................... (7,047) (10,006) (7,140)
Acquisition of MVE, net of cash acquired.................. (2,225)
Redemption of MVE preferred stock......................... (74,642)
Acquisition of Northcoast Cryogenics, net of cash
acquired................................................ (2,185)
Acquisition of Chart Marston.............................. (35,324)
Acquisition of Cryenco, net of cash acquired.............. (20,128)
Proceeds from sale of product line........................ 3,300
Other investing activities................................ 605 60 195
--------- -------- --------
NET CASH USED IN INVESTING ACTIVITIES..................... (82,194) (45,270) (27,073)
FINANCING ACTIVITIES
Borrowings on revolving credit facilities................. 96,305 43,594 48,000
Repayments on revolving credit facilities................. (87,082) (36,357) (54,750)
Borrowings for acquisition of MVE......................... 250,000
Principal payments on long-term debt...................... (148,957) (405) (835)
Premiums on repurchase of long-term debt.................. (12,459)
Deferred financing costs.................................. (7,698)
Purchases of treasury stock............................... (728) (8,278) (5,646)
Stock offering............................................ 33,666
Stock options exercised................................... 8 783 470
Dividends paid to shareholders............................ (2,370) (4,821) (3,858)
--------- -------- --------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES....... 87,019 (5,484) 17,047
--------- -------- --------
Net increase (decrease) in cash and cash equivalents........ (457) (19,820) 12,687
Effect of exchange rate changes on cash..................... 602 (106)
Cash and cash equivalents at beginning of year.............. 2,169 22,095 9,408
--------- -------- --------
CASH AND CASH EQUIVALENTS AT END OF YEAR.................... $ 2,314 $ 2,169 $ 22,095
========= ======== ========

The accompanying notes are an integral part of these consolidated financial
statements.

25

CHART INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE A--NATURE OF OPERATIONS

The Company is involved in the engineering and manufacturing of industrial
equipment and systems for the cryogenic and process industries and various
research applications. The Company's operations are primarily located in the
United States. Substantially all of the Company's sales and trade accounts
receivable are related to the industrial gas, hydrocarbon and chemical
processing and power generation industries. To reduce credit risk for both
foreign and domestic sales the Company requires customer advances, letters of
credit and other such guarantees of payment. For certain foreign customers the
Company also purchases credit and political risk insurance.

NOTE B--SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION: The consolidated financial statements include
the accounts of the Company and its subsidiaries. Intercompany accounts and
transactions are eliminated in consolidation. Certain items in prior year
financial statements have been reclassified to conform to current year
presentation.

USE OF ESTIMATES: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

CASH AND CASH EQUIVALENTS: The Company considers all investments with an
initial maturity of three months or less when purchased to be cash equivalents.
The December 31, 1999 balance includes money market investments and cash.

FINANCIAL INSTRUMENTS: The fair values of cash equivalents, accounts
receivable and short-term bank debt approximate their carrying amount because of
the short maturity of these instruments. The fair value of long-term debt is
estimated based on the present value of the underlying cash flows discounted at
the Company's estimated borrowing rate. At December 31, 1999 and 1998, the fair
value of the Company's long-term debt approximated its carrying value.

The Company has entered into interest rate derivative contracts with two of
its banks to hedge interest rate exposure. These contracts have a notional value
of $125 million and amortize following the Company's amortization schedule for
its term borrowings under the Credit Facility. These agreements are generally
described as collars and result in putting a cap on the base LIBOR interest rate
at approximately 7.0 percent and a floor at approximately 5.0 percent for
approximately half the Company's floating rate term debt. The fair value of
these contracts at December 31, 1999 is not significant.

INVENTORIES: Inventories are stated at the lower of cost or market with cost
being determined by both the last-in, first-out ("LIFO") method (approximately
16 percent and 51 percent of total inventory at December 31, 1999 and 1998,
respectively), and the first-in, first-out ("FIFO") method. The components of
inventory are as follows:

DECEMBER 31,
----------------------
1999 1998
-------- --------
(DOLLARS IN THOUSANDS)

Raw materials and supplies............................... $27,256 $14,785
Work in process.......................................... 14,022 13,955
Finished goods........................................... 9,595 1,273
LIFO reserve............................................. (295) (210)
------- -------
$50,578 $29,803
======= =======

26

NOTE B--SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
PROPERTY, PLANT AND EQUIPMENT: Property, plant and equipment are stated on
the basis of cost. Expenditures for maintenance, repairs and renewals are
charged to expense as incurred, whereas major betterments are capitalized. The
cost of applicable assets is depreciated over their estimated useful lives.
Depreciation is computed using the straight-line method for financial reporting
purposes and accelerated methods for income tax purposes. Depreciation expense
was $10,781,000, $5,629,000 and $3,135,000 in 1999, 1998 and 1997, respectively.
The following table shows original costs and the estimated useful lives by
classification of assets:

DECEMBER 31,
----------------------
CLASSIFICATION EXPECTED USEFUL LIFE 1999 1998
- -------------- ----------------------- -------- --------
(DOLLARS IN THOUSANDS)

Land and buildings................ 20-35 years (buildings) $ 40,524 $20,986
Machinery and equipment........... 3-12 years 52,528 34,993
Furniture and fixtures............ 3-5 years 6,432 4,665
Construction in process........... 540 1,094
-------- -------
100,024 61,738
Less accumulated depreciation..... 25,267 21,202
-------- -------
Total property, plant and
equipment, net.................. $ 74,757 $40,536
======== =======

Property, plant and equipment and intangible assets are periodically
evaluated for impairment. The Company assesses impairment for each of its
operating units by measuring future cash flows against the carrying value of
these long-lived assets. If the future undiscounted cash flows are less than the
carrying value of the assets, an impairment reserve is recorded in the period
identified. Measurement of impairment is based upon discounted cash flows, asset
appraisals or market values of similar assets.

GOODWILL AND OTHER INTANGIBLE ASSETS: All intangible assets are carried at
cost less applicable amortization. Goodwill represents the excess of purchase
price over the fair value of net assets acquired in purchase business
combinations. Goodwill is amortized using the straight-line method over the
periods of expected benefit, but not in excess of 40 years. Total amortization
expense of all intangibles was $6,128,000, $1,397,000 and $376,000 in 1999, 1998
and 1997, respectively. Accumulated amortization for all intangibles was
$7,853,000 and $2,142,000 at December 31, 1999 and 1998, respectively.

REVENUE RECOGNITION: For the majority of the Company's products, revenue is
recognized when products are shipped. For certain product lines, the Company
uses the percentage of completion method of accounting. Earned revenue is based
on the percentage that incurred costs to date bear to total estimated costs at
completion after giving effect to the most current estimates. Earned revenue on
contracts in process totaled $27.2 million through December 31, 1999. Timing of
amounts billed on contracts varies from contract to contract causing high
variation in working capital needs. Amounts billed on percentage of completion
contracts in process total $23.2 million at December 31, 1999. The cumulative
impact of revisions in total cost estimates during the progress of work is
reflected in the period in which these changes become known. Earned revenue
reflects the original contract price adjusted for agreed upon claims and change
orders, if any. Losses expected to be incurred on contracts in process, after
consideration of estimated minimum recoveries from claims and change orders, are
charged to operations as soon as such losses are known.

RESEARCH AND DEVELOPMENT COSTS: With the acquisition of MVE and the highly
technical products manufactured in the Company's applied technologies segment,
the Company incurred research and development costs of $3,469,000 in 1999. These
costs are expensed as incurred.

DEFERRED INCOME TAXES: The Company and its subsidiaries file a consolidated
federal income tax return. Deferred income taxes are provided for temporary
differences between financial reporting and the consolidated tax return in
accordance with the liability method.

27

NOTE B--SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
EARNINGS PER SHARE: The following table sets forth the computation of basic
and diluted earnings per share:

YEARS ENDED DECEMBER 31,
---------------------------------
1999 1998 1997
--------- --------- ---------
(DOLLARS AND SHARES IN THOUSANDS,
EXCEPT PER SHARE AMOUNTS)

Income (loss) before extraordinary item................. $(28,471) $28,215 $22,627
Extraordinary loss...................................... (7,809)
-------- ------- -------
Net income (loss)....................................... $(36,280) $28,215 $22,627
======== ======= =======
Weighted-average common shares.......................... 23,660 24,084 22,336
Effect of dilutive securities:
Employee stock options and warrants................... 342 524
-------- ------- -------
Dilutive potential common shares........................ 23,660 24,426 22,860
======== ======= =======
Net income (loss) per common share:
Income (loss) before extraordinary item............... $ (1.20) $ 1.17 $ 1.01
Extraordinary item.................................... (.33)
-------- ------- -------
Net income (loss) per common share.................... $ (1.53) $ 1.17 $ 1.01
======== ======= =======
Net income (loss) per common share -- assuming dilution:
Income (loss) before extraordinary item............... $ (1.20) $ 1.16 $ .99
Extraordinary item.................................... (.33)
-------- ------- -------
Net income (loss) per common share--assuming
dilution............................................ $ (1.53) $ 1.16 $ .99
======== ======= =======

FOREIGN CURRENCY TRANSLATION: The functional currency for the majority of
the Company's foreign operations is the applicable local currency. The
translation from the applicable foreign currencies to U.S. dollars is performed
for balance sheet accounts using current exchange rates in effect at the balance
sheet date and for revenue and expense accounts using a weighted average
exchange rate during the period. The resulting translation adjustments are
recorded as a component of shareholders' equity. Gains or losses resulting from
foreign currency transactions are charged to income as incurred.

EMPLOYEE STOCK OPTIONS: The Company has elected to follow Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees"
("APB 25") and related interpretations in accounting for its employee stock
options. Under APB 25, because the exercise price of the Company's employee
stock options equals the market price of the underlying stock on the date of
grant, no compensation expense is recognized.

STOCK SPLIT: All shares of common stock (except for transactions affecting
shares outstanding in the Consolidated Statements of Shareholders' Equity) and
per share amounts have been adjusted to give retroactive effect to a
three-for-two stock split effected in the form of a 50 percent stock dividend
distributed on June 30, 1998 to shareholders of record on June 16, 1998.

RECENTLY ISSUED ACCOUNTING STANDARDS: In June 1998, the Financial Accounting
Standards Board ("FASB") issued Statement No. 133, "Accounting for Derivative
Financial Instruments and Hedging Activities," which is required to be adopted
beginning in the year 2001. Because of the Company's minimal use of derivatives,
the adoption of Statement 133 is not expected to have a material impact on the
earnings or the financial position of the Company.

28

NOTE C--BALANCE SHEET COMPONENTS

DECEMBER 31,
----------------------
1999 1998
-------- --------
(DOLLARS IN THOUSANDS)

Other assets, net:
Deferred financing costs, net............................. $ 6,919
Existing technologies, net................................ 6,736
Patents, trademarks and intellectual property, net........ 7,053 $7,844
Deferred income taxes..................................... 3,464
Other..................................................... 5,063 2,146
------- ------
$29,235 $9,990
======= ======
Other current liabilities:
Accrued interest.......................................... $ 4,532 $ 10
Accrued income taxes...................................... 2,240 2,031
Accrued rebates........................................... 3,502
Accrued restructuring..................................... 1,338
Accrued other............................................. 12,791 6,837
------- ------
$24,403 $8,878
======= ======
Other long-term liabilities:
Deferred income taxes..................................... $ 6,271 $1,198
Accrued environmental..................................... 3,374 1,953
Accrued pension cost...................................... 5,634 221
Minority interest......................................... 940
Other..................................................... 240
------- ------
$16,459 $3,372
======= ======

NOTE D--LONG-TERM DEBT AND CREDIT ARRANGEMENTS

The following table shows the components of the Company's long-term
borrowings at December 31, 1999 and 1998, respectively.

DECEMBER 31,
-----------------------
1999 1998
---------- ----------
(DOLLARS IN THOUSANDS)

Term loan A, due March 2005, quarterly principal payments,
average interest rate of 8.63% at December 31, 1999....... $122,500
Term loan B, due March 2006, quarterly principal payments,
average interest rate of 9.19% at December 31, 1999....... 124,688
Revolving Credit Facility, due March 2005, average interest
rate of 9.02% at December 31, 1999........................ 18,000 $ 7,250
Industrial Development Revenue Bonds, due June 2011,
semi-annual principal payments, interest at variable rates
from 2% to 9%............................................. 2,860
Revolving foreign credit facility........................... 2,932
Several notes payable with varying principal and interest
payments.................................................. 7,692 4,075
-------- -------
Total long-term debt........................................ 278,672 11,325
Less: current maturities.................................... 19,336 431
-------- -------
Long-term debt, net of current maturities................... $259,336 $10,894
======== =======

29

NOTE D--LONG-TERM DEBT AND CREDIT ARRANGEMENTS (CONTINUED)
In order to finance the acquisition of MVE, the Company negotiated a
consolidated credit and revolving loan facility (the "Credit Facility") which
provides for loans of up to $300 million, of which $50 million may be available
for revolving credit and the issuance of letters of credit. The Company paid
approximately $6.5 million in fees to establish the Credit Facility. The Credit
Facility provides the bank with a secured interest in substantially all of the
property, plant and equipment of the Company.

Under the terms of the Credit Facility, term loans and revolving credit bear
interest, at the Company's option, at rates equal to the prime rate (8.50
percent at December 31, 1999) or LIBOR plus incremental margins. The incremental
margins vary based on the Company's financial position and currently range from
1 percent to 3 percent. The Company is also required to pay a commitment fee of
.5 percent per annum on the unused amount of the revolving portion of the Credit
Facility. The Company has letters of credit outstanding and bank guarantees
totaling $8.6 million supported by the Credit Facility.

The Credit Facility contains certain covenants and conditions which impose
limitations on the Company and its operating units, including meeting certain
financial tests and the quarterly maintenance of certain financial ratios on a
consolidated basis such as: minimum net worth, maximum leverage, minimum pre-tax
interest coverage ratio and minimum fixed charge coverage ratio. As a result of
the Company's second-quarter performance, the Company breached a financial
covenant of the credit agreement related to the Credit Facility. On August 24,
1999, Chase Manhattan Bank, the Company's agent bank, waived such breach and
amended the Credit Facility. The amendment provides for modified covenants based
upon current performance levels, increased interest rates and the suspension of
quarterly dividend payments. The Company paid approximately $1.2 million to
amend the Credit Facility. As of December 31, 1999, the Company was in
compliance with all covenants and conditions of the Credit Facility.

The scheduled annual maturities of long-term debt at December 31, 1999, are
as follows:

YEAR AMOUNT
- ---- ----------------------
(DOLLARS IN THOUSANDS)

2000..................................................... $ 19,336
2001..................................................... 20,073
2002..................................................... 26,209
2003..................................................... 31,168
2004..................................................... 36,039
Thereafter............................................... 145,847
--------
$278,672
========

Interest paid was $11,332,000, $1,561,000 and $709,000 in 1999, 1998 and
1997 respectively.

NOTE E--ACQUISITIONS

The following acquisitions were accounted for using the purchase method of
accounting and, accordingly, the related purchase price was allocated to assets
acquired and liabilities assumed based on their estimated fair values. Results
of operations for these acquisitions have been included in the consolidated
results of operations since the date of acquisition. The purchase price
allocations reflected in these financial statements are preliminary and may be
adjusted as the estimated fair value of the assets acquired and liabilities
assumed are finalized.

On December 15, 1999, the Company acquired certain assets relating to a
cryogenic repair business previously operated by Air Liquide for $1.0 million in
cash and $2.6 million in rebate credits to be given to Air Liquide on future
sales.

30

NOTE E--ACQUISITIONS (CONTINUED)
On April 12, 1999, the Company acquired the common stock of MVE
Holdings, Inc. ("MVE") for approximately $9.2 million in cash ($2.2 million net
of cash acquired) and redeemed the preferred stock of MVE for approximately
$74.6 million. Finally, the Company paid approximately $156.1 million to retire
MVE's existing debt obligations and complete the tender offer and consent
solicitation for the 12.5 percent senior secured notes due 2002 issued by
MVE, Inc., a subsidiary of MVE. In allocating the purchase price, $173.5 million
was allocated to net liabilities assumed, including minority interests in
certain consolidated subsidiaries of MVE, $22.0 million was allocated to
in-process research and development ("IPR&D") projects that had not reached
technological feasibility and had no alternative future use, $7.7 million was
allocated to identifiable intangible assets which are being amortized over five
years, and $153.0 million was allocated to goodwill, which is being amortized
over 40 years. The amount allocated to IPR&D was determined by independent
consultants who estimated the costs to develop the technology into commercially
viable products, estimated cash flows resulting from the expected revenues
generated from such products and discounted the net cash flows back to their
present value using a risk-adjusted discount rate. This amount was recognized as
a non-cash expense without tax benefit at the date of acquisition.

On March 15, 1999, the Company acquired a group of privately held companies,
collectively known as Northcoast Cryogenics, for approximately $2.3 million in
cash ($2.2 million net of cash acquired) and $720,000 in Chart Common Stock.
Additional contingent consideration will be issued in an amount equal to three
percent of the net sales of Northcoast Cryogenics, as defined in the purchase
agreement, with respect to each fiscal year or partial fiscal year during the
three-year period beginning March 15, 1999, subject to possible extension for
one additional year. In allocating the purchase price, $373,000 was allocated to
net assets acquired and $2.7 million was allocated to goodwill, which is being
amortized over 15 years.

On March 27, 1998, the Company, through its wholly-owned subsidiary Chart
Marston, acquired the net assets of the industrial heat exchanger division of
IMI Marston Limited, a wholly-owned subsidiary of IMI plc, for 21 million Pounds
Sterling (approximately U.S. $35.3 million). The Company borrowed 11 million
Pounds Sterling (approximately U.S. $18.5 million) to fund the acquisition. In
allocating the purchase price, $15.9 million was allocated to goodwill, which is
being amortized over 40 years.

On July 31, 1997, the Company acquired all of the shares outstanding of
Cryenco, a Denver, Colorado based manufacturer of cryogenic tanks and related
products for the transportation, storage and dispensing of LNG and liquefied
argon, oxygen and nitrogen. Consideration for the acquisition included the
payment of $19.6 million to purchase the common stock outstanding and certain
warrants of Cryenco, the payment of $685,000 to redeem its preferred stock
outstanding, and the assumption of approximately $6.2 million of indebtedness.
The Company also assumed Cryenco's obligations under other warrants, which were
converted into warrants to purchase Common Stock of the Company, and were
recorded as additional paid-in capital at an estimated fair value of $436,000.
In allocating the purchase price to the net assets acquired, $15.2 million was
allocated to goodwill, which is being amortized over 40 years.

31

NOTE E--ACQUISITIONS (CONTINUED)
The pro-forma unaudited results of operations for 1999 and 1998, assuming
consummation of the acquisition of MVE and extinguishment of the related debt as
of January 1, 1998, are as follows:

DECEMBER 31,
--------------------------
1999 1998
---------- ----------
(DOLLARS IN THOUSANDS
EXCEPT PER SHARE AMOUNTS)

Net sales............................................ $337,754 $435,560
Income (loss) before extraordinary item.............. (30,412) 20,675
Income (loss) before extraordinary item per share.... (1.28) .86
Income (loss) before extraordinary item per share--
assuming dilution.................................. (1.28) .85
Net income (loss).................................... (38,221) 26,793
Net income (loss) per share.......................... (1.61) 1.11
Net income (loss) per share--assuming dilution....... (1.61) 1.10

NOTE F--RESTRUCTURING PLAN

During 1999, the Company recorded net restructuring charges of $12.9
million. The restructuring charges related to the creation of a new
organizational structure necessitated primarily by the acquisition of MVE.

Pursuant to the restructuring plan, the Company recognized charges in 1999
for the write-off of net book value of certain fixed assets totaling $2.8
million made redundant by the acquisition, the write-off of impaired goodwill of
$6.8 million resulting from the Company's decision to discontinue production of
the Cryenco trailer product line, which was part of the distribution and storage
equipment segment, $1.2 million for lease payments and other costs related to
exiting certain facilities, $936,000 for the write-off of inventory to be
disposed of, which has been classified in cost of sales, and $1.9 million for
severance and other costs related to the elimination of 188 positions throughout
the Company. In the third quarter of 1999 the Company reduced the restructuring
reserve by $803,000 for charges taken in the second quarter of 1999 related to
certain fixed assets held for disposal that were subsequently determined to be
useable. The Company reinstated the net book value of these assets in the third
quarter of 1999.

The activity related to the charges recognized in 1999 is as follows:

ACTIVITY
RELATED RESERVE
RESTRUCTURING TO THE DECEMBER 31,
CHARGES CHARGES 1999
------------- -------- ------------
(DOLLARS IN THOUSANDS)

Non-cash items:
Inventory....................................... $ 936 $ (936)
Fixed assets.................................... 2,834 (2,834)
Impaired goodwill............................... 6,823 (6,823)

Cash items:
Severance....................................... 1,912 (1,566) $ 346
Lease termination costs......................... 1,017 (25) 992
Other........................................... 199 (199)
------- -------- ------
$13,721 $(12,383) $1,338
======= ======== ======

32

NOTE F--RESTRUCTURING PLAN (CONTINUED)
The Company expects to have all actions comprising the restructuring plan
completed by the second quarter of 2000. At December 31, 1999, the Company's
restructuring reserve of $1.3 million is included in other current liabilities.

NOTE G--INCOME TAXES

Deferred income taxes reflect the net tax effect of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. At December 31, 1999, the
Company had net operating loss carryforwards for income tax purposes of $3.4
million which expire in years 2003 through 2020 and other credits of $200,000
which have an indefinite carryforward period. These carryforwards resulted from
the current year loss and the Company's acquisitions of Process Engineering and
MVE. The acquired carryforwards are subject to Section 382 limitations imposed
by the Internal Revenue Service Code of 1986, as amended, and the regulations
thereunder. Significant components of the Company's deferred tax assets and
liabilities are as follows:

DECEMBER 31,
----------------------
1999 1998
-------- --------
(DOLLARS IN THOUSANDS)

Deferred tax assets:
Accruals and reserves................................. $15,978 $4,643
Net operating loss and credit carryforwards........... 3,577 233
Other--net............................................ 320 285
------- ------
Total deferred tax assets............................. 19,875 5,161
------- ------
Deferred tax liabilities:
Property, plant and equipment......................... 3,536 2,411
Intangibles........................................... 1,827
Inventory............................................. 540 1,537
Pensions.............................................. 356 371
Other--net............................................ 12 195
------- ------
Total deferred tax liabilities........................ 6,271 4,514
------- ------
Net deferred taxes...................................... $13,604 $ 647
======= ======

Management has determined, based on the Company's history of prior earnings
and its expectations for the future, that taxable income of the Company will
more likely than not be sufficient to recognize fully these net deferred tax
assets.

33

NOTE G--INCOME TAXES (CONTINUED)
Significant components of the provision for income taxes are as follows:

YEARS ENDED DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
(DOLLARS IN THOUSANDS)

Current:
Federal................................................ $ 3,699 $12,844 $11,908
State.................................................. 624 793 966
Foreign................................................ 2 459
------- ------- -------
4,325 14,096 12,874

Deferred:
Federal................................................ (1,630) 821 (750)
State.................................................. (389) 77 (67)
Foreign................................................ 800 45
------- ------- -------
(1,219) 943 (817)
------- ------- -------
$ 3,106 $15,039 $12,057
======= ======= =======

The reconciliation of income taxes computed at the U.S. federal statutory
tax rates to income tax expense is as follows:

YEARS ENDED DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
(DOLLARS IN THOUSANDS)

Tax at U.S. statutory rates.............................. $(8,780) $15,139 $12,139
State income taxes, net of federal tax benefit........... 153 566 584
Effective tax rate differential of earnings outside of
U.S.................................................... 989 (267)
Federal tax benefit of Foreign Sales Corp................ (291) (617) (528)
Non-deductible goodwill.................................. 11,157 158 32
Other--net............................................... (122) 60 (170)
------- ------- -------
$ 3,106 $15,039 $12,057
======= ======= =======

The Company paid approximately $2.2 million, $12.4 million and $11.1 million
of income taxes in 1999, 1998 and 1997, respectively.

NOTE H--EMPLOYEE BENEFIT PLANS

The Company has five defined benefit pension plans which cover certain
hourly and salary employees. The Company's funding policy is to contribute at
least the minimum funding amounts required by law. Plan assets consist primarily
of corporate stocks and bonds.

During 1999, the Company, through the acquisition of MVE, assumed two
defined benefit pension plans. In addition, the defined benefit pension plan
related to Chart Marston was finalized during the year, and the assets and
liabilities were transferred from the previous plan. The opening benefit
obligations assumed and plan assets acquired are shown as separate line items in
the reconciliation below.

34

NOTE H--EMPLOYEE BENEFIT PLANS (CONTINUED)
The actuarially computed combined pension cost included the following
components for the years ended December 31:

YEARS ENDED DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
(DOLLARS IN THOUSANDS)

Service cost................................................ $ 2,194 $ 227 $ 321
Interest cost............................................... 2,169 383 336
Actual return on plan assets................................ (5,085) (183) (574)
Net amortization and deferrals.............................. 2,701 (194) 265
------- ----- -----
Total pension cost.......................................... $ 1,979 $ 233 $ 348
======= ===== =====

During 1998 the Company curtailed its pension plan related to certain of the
union employees at ALTEC and recognized $161,000 of expense in addition to the
normal pension cost disclosed above. As a result of this curtailment, the
Company is making contributions to a multi-employer pension plan maintained by
the union. The Company now makes contributions to two union supported
multi-employer pension plans with expenses totaling $269,000, $297,000 and
$66,000 in 1999, 1998 and 1997, respectively.

The following table sets forth changes in the benefit obligation, plan
assets, funded status of the plans and amounts recognized in the balance sheets
as of December 31:

1999 1998
-------- --------
(DOLLARS IN THOUSANDS)

Change in benefit obligation:
January 1 benefit obligation............................ $ 6,143 $5,366
Benefit obligations assumed........................... 35,485
Service cost.......................................... 2,194 227
Interest cost......................................... 2,169 383
Benefits paid......................................... (923) (223)
Actuarial gains and losses............................ (7,374) 390
------- ------

December 31 benefit obligation.......................... $37,694 $6,143
======= ======
Change in plan assets:
Fair value at January 1................................. $ 5,667 $5,113
Plan assets acquired.................................. 29,450
Actual return......................................... 5,085 183
Employer contributions................................ 1,899 594
Employee contributions................................ 154
Benefits paid......................................... (922) (223)
------- ------
Fair value at December 31............................. $41,333 $5,667
======= ======
Funded status of the plans.............................. $ 3,639 $ (76)
Unrecognized actuarial gain (loss)...................... (8,226) 1,307
------- ------
Net pension asset (liability) recognized................ $(4,587) $ 831
======= ======
Prepaid benefit cost.................................... $ 1,047 $1,052
Accrued benefit liability............................... (5,634) (221)
------- ------
Net pension asset (liability) recognized................ $(4,587) $ 831
======= ======

35

NOTE H--EMPLOYEE BENEFIT PLANS (CONTINUED)

The assumptions used in determining pension cost and funded status
information for the years ended December 31, 1999 and 1998 are as follows:

1999 1998
-------- ------------

Discount rate............................................... 8.04% 6.5% - 6.75%
Weighted average rate of increase in compensation........... 3.00% 3.0% - 5.0%
Expected long-term weighted average rate of return on plan
assets.................................................... 9.25% 8.0%

While on an overall basis at December 31, 1999, plan assets exceed plan
liabilities, two of the Company's plans have benefit obligations which exceed
individual plan assets. This shortfall totals $1.3 million on benefit
obligations of $12.9 million at December 31, 1999.

The Company has defined contribution savings plans that cover most of its
employees. Company contributions to the plans are based on employee
contributions and the level of Company match and discretionary contributions.
Expenses under the plans totaled $1,792,000, $1,583,000 and $1,314,000 for the
years ended December 31, 1999, 1998 and 1997, respectively.

NOTE I--STOCK OPTION PLANS

In July 1992, the Company adopted a Key Employee Stock Option Plan which
provides for the granting of options to purchase shares of Common Stock to
certain key employees of the Company. In May 1999 and May 1997, shareholders
approved increases of 300,000 shares and 562,500 shares, respectively, in the
number of shares authorized for the Key Employee Stock Option Plan. These
nonqualified stock options vest in equal annual installments over a five year
period from the date of grant and are exercisable for up to 10 years at an
option price determined by the Compensation Committee of the Board of Directors.

Certain information for 1999, 1998 and 1997 relative to the Key Employee
Stock Option Plan is summarized below:

1999 1998 1997
-------------------- -------------------- --------------------
WEIGHTED WEIGHTED WEIGHTED
AVERAGE AVERAGE AVERAGE
NUMBER EXERCISE NUMBER EXERCISE NUMBER EXERCISE
OF SHARES PRICE OF SHARES PRICE OF SHARES PRICE
--------- -------- --------- -------- --------- --------

Outstanding at beginning of
year........................ 1,036,437 $5.71 936,557 $ 6.35 730,125 $3.81
Granted....................... 250,000 6.33 431,250 9.33 257,718 13.09
Exercised..................... (500) 2.44 (63,620) 2.31 (46,786) 3.88
Expired or canceled........... (32,962) 8.31 (267,750) 14.57 (4,500) 7.05
--------- ----- --------- ------ ------- -----
Outstanding at end of year.... 1,252,975 $5.77 1,036,437 $ 5.71 936,557 $6.35
========= ===== ========= ====== ======= =====
Exercisable at end of year.... 584,395 427,872 322,599
========= ========= =======
Weighted-average fair value of
options granted during the
year........................ $3.99 $ 3.98 $5.15
===== ====== =====
Participants at end of year... 89 70 57
========= ========= =======
Available for future grant at
end of year................. 280,725 197,763 361,276
========= ========= =======

36

NOTE I--STOCK OPTION PLANS (CONTINUED)
Exercise prices for options outstanding as of December 31, 1999 ranged from
$.08 to $25.78. The weighted-average remaining contractual life of those options
is 7.2 years. Certain information for ranges of exercise prices is summarized
below:

OUTSTANDING EXERCISABLE
---------------------------------- --------------------
WEIGHTED WEIGHTED
AVERAGE AVERAGE
NUMBER EXERCISE CONTRACTUAL NUMBER EXERCISE
EXERCISE PRICE OF SHARES PRICE LIFE OF SHARES PRICE
- -------------- --------- -------- ----------- --------- --------

Less than $5.................... 368,625 $ 2.48 4.4 338,250 $ 2.45
$5 to less than $10............. 877,911 7.05 8.3 239,706 7.04
Equal to or greater than $10.... 6,439 18.85 7.6 6,439 18.85
--------- -------
1,252,975 5.77 7.2 584,395 4.51
========= =======

In May 1996, the shareholders approved the 1996 Outside Directors Stock
Option Plan, which provides for the granting of options to purchase up to
168,750 shares of Common Stock, supplementing the previously authorized 1995 and
1994 Outside Directors Stock Option Plans (collectively, the "Outside Directors
Stock Option Plans"). The option price for options granted under the Outside
Directors Stock Option Plans to outside directors will be equal to the fair
market value of a share of Common Stock on the date of grant. These nonqualified
stock options become fully vested and exercisable on the first anniversary of
the date of grant and are exercisable for a period of ten years.

Certain information for 1999, 1998 and 1997 relative to the Outside
Directors Stock Option Plans is summarized below:

1999 1998 1997
-------------------- -------------------- --------------------
WEIGHTED WEIGHTED WEIGHTED
AVERAGE AVERAGE AVERAGE
NUMBER EXERCISE NUMBER EXERCISE NUMBER EXERCISE
OF SHARES PRICE OF SHARES PRICE OF SHARES PRICE
--------- -------- --------- -------- --------- --------

Outstanding at beginning of
year........................ 82,500 $11.52 63,750 $ 6.72 52,500 $ 2.63
Granted....................... 45,000 9.00 33,750 18.75 33,750 10.41
Exercised..................... (3,000) 1.78 (15,000) 7.38 (22,500) 2.71
------- ------ ------- ------ ------- ------
Outstanding at end of year.... 124,500 $10.84 82,500 $11.52 63,750 $ 6.72
======= ====== ======= ====== ======= ======
Exercisable at end of year.... 79,500 48,750 15,000
======= ======= =======
Weighted-average fair value of
options granted during the
year........................ $ 4.89 $ 7.99 $ 3.03
====== ====== ======
Participants at end of year... 4 3 3
======= ======= =======
Available for future grant at
end of year................. 33,750 78,750 112,500
======= ======= =======

37

NOTE I--STOCK OPTION PLANS (CONTINUED)
Pro forma information regarding net income and earnings per share is
required by FASB Statement No. 123, "Accounting for Stock-Based Compensation,"
which also requires that the information be determined as if the Company had
accounted for its employee stock options granted subsequent to December 31, 1994
under the fair value method of Statement 123. The fair value for these options
was estimated at the date of grant using a Black-Scholes option pricing model
with the following weighted-average assumptions for 1999, 1998 and 1997:

1999 1998 1997
-------- -------- --------

Risk free interest rate........................... 6.5% 4.7% 6.7%
Dividend yield.................................... 0.0% 2.5% 2.0%
Market price volatility factor.................... 54.2% 50.0% 38.0%
Weighted average expected life of key employee
options......................................... 7 years 6 years 6 years
Weighted average expected life of outside
directors options............................... 5 years 3 years 3 years

The Black-Scholes option valuation model was developed for use in estimating
the fair value of traded options, which have no vesting restrictions and are
fully transferable. In addition, option valuation models require the input of
highly subjective assumptions including the expected stock price volatility.
Because the Company's Key Employee and Outside Directors stock options have
characteristics significantly different from those of traded options, and
because changes in the subjective input assumptions can materially affect the
fair value estimate, in management's opinion, the existing models do not
necessarily provide a reliable single measure of the fair value of these stock
options.

The Company's pro forma disclosures showing the estimated fair value of the
options, amortized to expense over the options' vesting periods, are as follows:

1999 1998 1997
--------- --------- ---------
(DOLLARS IN THOUSANDS, EXCEPT PER
SHARE AMOUNTS)

Pro forma net income (loss)..................... $(37,311) $27,460 $22,251
Pro forma net income (loss) per share........... (1.58) 1.14 1.00
Pro forma net income (loss) per share--assuming
dilution...................................... (1.58) 1.12 .97

NOTE J--LEASE COMMITMENTS

The Company incurred $2,266,000, $1,940,000 and $1,533,000 of rental expense
under operating leases in 1999, 1998 and 1997, respectively. At December 31,
1999, future minimum lease payments for non-cancelable operating leases for the
next five years total $7.8 million and are payable as follows: 2000--
$2,340,000; 2001--$1,891,000; 2002--$1,461,000; 2003--$1,236,000; and
2004--$886,000.

NOTE K--CONTINGENCIES

The Company's operating units are parties, in the ordinary course of their
businesses, to various legal actions related to performance under contracts,
product liability and other matters, several of which actions claim substantial
damages. The Company believes these legal actions will not have a material
adverse effect on the Company's financial position or liquidity. The Company is
subject to federal, state and local environmental laws and regulations
concerning, among other matters, waste water effluents, air emissions and
handling and disposal of hazardous materials such as cleaning fluids.

38

NOTE K--CONTINGENCIES (CONTINUED)
As part of its ongoing environmental compliance and monitoring programs, the
Company is voluntarily developing work plans for remediation of environmental
conditions involving certain of its operating facilities. Based upon the
Company's study of the known conditions and its prior experience in
investigating and correcting environmental conditions, the Company estimates
that the potential costs of these site remediation efforts will not have a
material adverse effect on the Company's financial position, liquidity, cash
flows or results of operations. Expected future expenditures relating to these
remediation efforts are expected to be incurred primarily within the next 48
months, as the necessary regulatory agency approvals of the Company's work plans
are obtained. Although the Company believes it has adequately provided for the
cost of all known environmental conditions, the applicable regulatory agencies
could insist upon different and more costly remediative measures than those the
Company believes are adequate or required by existing law. The Company believes
that it is currently in substantial compliance with all known material and
applicable environmental regulations.

NOTE L--OPERATING SEGMENTS

The Company created a new organizational structure subsequent to its
acquisition of MVE and changed the composition of its operating segments. As a
result, the Company has the following three reportable segments: process systems
and equipment ("Process"), distribution and storage equipment ("Distribution")
and applied technologies ("Applications"). All segment information for all prior
periods presented has been restated to reflect the Company's current reportable
segments. The Company's reportable segments are business units that offer
different products. The reportable segments are each managed separately because
they manufacture and distribute distinct products with different production
processes. The Process segment consists of two operating divisions that sell
brazed aluminum heat exchangers and coldboxes to industrial gas, natural gas and
petrochemical processing companies who use them for the liquefaction and
separation of industrial and natural gases. The Distribution segment consists of
two operating divisions that sell cryogenic tanks, trailers, intermodal
containers, railcars and cryogenic repair services to various companies for the
storage and transportation of both industrial and natural gases. The
Applications segment consists of three operating divisions that sell products
including vacuum-insulated, bulk liquid CO(2) systems, medical oxygen products,
magnetic resonance imaging cryostat components, biological storage systems,
vacuum-insulated piping systems, LNG alternative fuel systems, nitrogen
injection systems, large and small thermal vacuum test chambers, CO(2) dry
cleaning equipment and various cryogenic and non-cryogenic components including
pumps, valves and tubing. Due to the nature of the products that each operating
segment sells, there are no intersegment sales.

39

NOTE L--OPERATING SEGMENTS (CONTINUED)
The Company evaluates performance and allocates resources based on profit or
loss from operations before interest expense and income taxes. The accounting
policies of the reportable segments are the same as those described in the
summary of significant accounting policies.

1999
-------------------------------------------------
PROCESS DISTRIBUTION APPLICATIONS TOTALS
-------- ------------ ------------ --------
(DOLLARS IN THOUSANDS)

Revenues from external customers................... $82,085 $105,529 $105,323 $292,937
Depreciation and amortization expense.............. 4,489 5,451 5,484 15,424
Operating income (loss) before interest expense and
income taxes..................................... (300) 3,919 10,583 14,202
Segment assets..................................... 61,934 172,649 163,203 397,786
Capital expenditures............................... 1,072 1,761 2,633 5,466

1998
-------------------------------------------------
PROCESS DISTRIBUTION APPLICATIONS TOTALS
-------- ------------ ------------ --------
(DOLLARS IN THOUSANDS)

Revenues from external customers.................. $124,609 $ 42,558 $ 62,256 $229,423
Depreciation and amortization expense............. 3,557 1,446 1,684 6,687
Operating income before interest expense and
income taxes.................................... 30,806 5,760 10,062 46,628
Segment assets.................................... 68,342 36,298 40,328 144,968
Capital expenditures.............................. 2,292 4,426 3,029 9,747

1997
-------------------------------------------------
PROCESS DISTRIBUTION APPLICATIONS TOTALS
-------- ------------ ------------ --------
(DOLLARS IN THOUSANDS)

Revenues from external customers................... $93,562 $ 31,744 $ 66,943 $192,249
Depreciation and amortization expense.............. 1,476 828 1,190 3,494
Operating income before interest expense and income
taxes............................................ 22,626 6,074 9,152 37,852
Segment assets..................................... 34,895 32,426 37,829 105,150
Capital expenditures............................... 4,791 937 1,412 7,140

40

NOTE L--OPERATING SEGMENTS (CONTINUED)
GEOGRAPHIC INFORMATION:

1999 1998 1997
--------------------- --------------------- ---------------------
LONG-LIVED LONG-LIVED LONG-LIVED
REVENUES ASSETS REVENUES ASSETS REVENUES ASSETS
-------- ---------- -------- ---------- -------- ----------
(DOLLARS IN THOUSANDS)

United States........................ $241,228 $240,313 $205,997 $48,621 $192,249 $44,070
Non U.S. Countries................... 51,709 40,907 23,426 33,473
-------- -------- -------- ------- -------- -------
Total................................ $292,937 $281,220 $229,423 $82,094 $192,249 $44,070
======== ======== ======== ======= ======== =======

RECONCILIATION OF OPERATING INCOME (LOSS) BEFORE INTEREST EXPENSE AND INCOME
TAXES:

1999 1998 1997
-------- -------- --------
(DOLLARS IN THOUSANDS)

Reportable segments......................................... $ 14,202 $46,628 $37,852
Headquarters................................................ (25,938) (2,473) (2,818)
-------- ------- -------
Total....................................................... $(11,736) $44,155 $35,034
======== ======= =======

RECONCILIATION OF TOTAL ASSETS:

1999 1998 1997
-------- -------- --------
(DOLLARS IN THOUSANDS)

Reportable segments......................................... $397,786 $144,968 $105,150
Headquarters................................................ 26,784 13,237 23,769
-------- -------- --------
Total....................................................... $424,570 $158,205 $128,919
======== ======== ========

NOTE M--EXTRAORDINARY ITEM

In the second quarter of 1999, the Company borrowed funds under its Credit
Facility and retired prior to maturity certain debt assumed as part of the MVE
acquisition with a fair value of $119.2 million. The debt extinguishment
resulted in an extraordinary loss of $12.5 million, $7.8 million net of tax, or
$.33 per diluted share.

41

NOTE N--QUARTERLY DATA (UNAUDITED)

Selected quarterly data for the years ended December 31, 1999 and 1998 are
as follows.

YEAR ENDED DECEMBER 31, 1999
----------------------------------------------------
FIRST SECOND THIRD FOURTH
QUARTER QUARTER QUARTER QUARTER TOTAL
-------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

Sales............................................ $44,588 $ 84,726 $84,108 $79,515 $292,937
Gross profit..................................... 12,317 20,875 20,147 24,042 77,381
Operating income (loss).......................... 4,725 (19,758) (4,169) 7,466 (11,736)
Income (loss) before extraordinary item.......... 2,902 (24,080) (8,946) 1,653 (28,471)
Extraordinary loss on early extinguishment of
debt, net of taxes of $4.7 million............. (7,809) (7,809)
Net income (loss)................................ 2,902 (31,889) (8,946) 1,653 (36,280)
Income (loss) before extraordinary item per
share.......................................... .12 (1.01) (.38) .07 (1.20)
Net income (loss) per share...................... .12 (1.34) (.38) .07 (1.53)
Income (loss) before extraordinary item per
share--assuming dilution....................... .12 (1.01) (.38) .07 (1.20)
Net income (loss) per share--assuming dilution... .12 (1.34) (.38) .07 (1.53)

YEAR ENDED DECEMBER 31, 1998
----------------------------------------------------
FIRST SECOND THIRD FOURTH
QUARTER QUARTER QUARTER QUARTER TOTAL
-------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

Sales............................................ $56,104 $57,030 $57,823 $58,466 $229,423
Gross profit..................................... 20,560 19,412 19,061 18,624 77,657
Operating income................................. 12,219 11,652 10,506 9,778 44,155
Net income....................................... 7,942 7,225 6,727 6,321 28,215
Net income per share............................. .33 .30 .28 .27 1.17
Net income per share--assuming dilution.......... .32 .29 .28 .26 1.16

NOTE O--SUBSEQUENT EVENT

In February 2000, the Company entered into an agreement to sell its
manufacturing and office facility located in Westborough, Massachusetts, for
$4.1 million. The sale is expected to be completed by April 30, 2000. The
Company's Process Systems Division will lease space from the new owner and will
remain in the office facility.

42

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

None.

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

The information appearing under the captions "Election of Directors" and
"Compliance with Section 16(a) of the Securities Exchange Act of 1934" in the
registrant's definitive Proxy Statement to be used in connection with the Annual
Meeting of Stockholders to be held on May 4, 2000 (the "2000 Proxy Statement")
is incorporated herein by reference. Information regarding executive officers of
the registrant is set forth in Part I of this Form 10-K.

ITEM 11. EXECUTIVE COMPENSATION.

The information required by this item is incorporated herein by reference to
"Election of Directors" and "Executive Compensation" in the 2000 Proxy
Statement.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

The information required by this item is incorporated herein by reference to
"Stock Ownership of Principal Holders and Management" in the 2000 Proxy
Statement.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

None.

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.

(a)(1) Report of Independent Auditors.............................. 21
Consolidated Balance Sheets at December 31, 1999 and 1998... 22
Consolidated Statements of Operations for the Years ended
December 31, 1999, 1998 and 1997.......................... 23
Consolidated Statements of Shareholders' Equity for the
Years ended December 31, 1999, 1998 and 1997.............. 24
Consolidated Statements of Cash Flows for the Years ended
December 31, 1999, 1998 and 1997.......................... 25
Notes to Consolidated Financial Statements.................. 26

(a)(2) Financial Statement Schedules.
No financial statement schedules required.

(a)(3) Exhibits
See the Index to Exhibits at page 45 of this Form 10-K
Annual Report.

(c) Reports on Form 8-K.
None

43

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed on
its behalf by the undersigned, thereunto duly authorized.

CHART INDUSTRIES, INC.

By: /s/ ARTHUR S. HOLMES
-----------------------------------------
Arthur S. Holmes
CHAIRMAN & CHIEF EXECUTIVE OFFICER

Date: March 16, 2000

Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

SIGNATURE TITLE DATE
--------- ----- ----

/s/ ARTHUR S. HOLMES Chairman and Chief Executive
------------------------------------------- Officer (Principal Executive March 16, 2000
Arthur S. Holmes Officer)

Chief Financial Officer,
/s/ DON A. BAINES Treasurer and a Director
------------------------------------------- (Principal Financial March 16, 2000
Don A. Baines Officer)

Controller and Chief
/s/ JOHN T. ROMAIN Accounting Officer
------------------------------------------- (Principal Accounting March 16, 2000
John T. Romain Officer)

/s/ RICHARD J. CAMPBELL
------------------------------------------- Director March 16, 2000
Richard J. Campbell

/s/ THOMAS F. MCKEE
------------------------------------------- Director March 16, 2000
Thomas F. McKee

/s/ LAZZARO G. MODIGLIANI
------------------------------------------- Director March 16, 2000
Lazzaro G. Modigliani

/s/ ROBERT G. TURNER, JR.
------------------------------------------- Director March 16, 2000
Robert G. Turner, Jr.

44

EXHIBIT INDEX

EXHIBIT
NO. DESCRIPTION
- --------------------- -----------

2.1 Plan and Agreement of Merger, dated April 30, 1997, by and
among the Company, Greenville Tube Corporation, Chart
Acquisition Company, Inc. and Cryenco Sciences, Inc....... (F)
2.2 Agreement for the Sale and Purchase of the Industrial Heat
Exchanger Group, dated March 5, 1998, by and among the
Company, IMI Kynoch Limited, IMI Marston Limited, IMI plc
and Chart Marston Limited................................. (H)
2.3 Agreement and Plan of Merger, dated as of February 16, 1999,
by and among the Company, Chart Acquisition Company and
MVE Holdings, Inc......................................... (K)
2.4 Agreement and Plan of Merger, dated as of February 25, 1999,
by and among the Company, Chart Acquisition Company and
MVE Investors, LLC........................................ (K)
3.1 Amended and Restated Certificate of Incorporation of the
Company, as filed with the Secretary of State of Delaware
on December 3, 1992....................................... (A)
3.2 Amended and Restated By-Laws of the Company................. (A)
4.1 Specimen certificate of the Company's Common Stock.......... (B)
4.2 Form of Warrant Agreements of various dates by and between
Cryenco Sciences, Inc. and various warrant holders........ (F)
4.3 Form of Amendment No. 1 to Warrant Agreement by and among
the Company, Cryenco Sciences, Inc. and various warrant
holders................................................... (F)
4.4 Form of Warrant Certificate................................. (F)
4.5 Rights Agreement, dated as of May 1, 1998, by and between
the Company and National City Bank, as Rights Agent....... (I)
10.1 Form of Indemnity Agreement of the Company.................. (B)
*10.2 Key Employees Stock Option Plan of the Company.............. (B)
*10.3 1994 Stock Option Plan for Outside Directors of the
Company...................................................
*10.3.1 1995 Stock Option Plan for Outside Directors of the
Company................................................... (C)
*10.3.2 1996 Stock Option Plan for Outside Directors of the
Company................................................... (D)
*10.4 Amended and Restated 1997 Stock Option and Incentive Plan...
*10.5 1997 Stock Bonus Plan....................................... (E)
*10.6 Deferred Compensation Plan.................................. (J)
10.7 License Agreement, dated August 30, 1991, by and between
Koch Industries, Inc. and PSI relating to the Ryan/Holmes
Technology................................................ (B)
10.8 Lease, dated August 1991, by and between Koch Process
Systems, Inc. and PSI..................................... (B)
10.9 Permitted User Agreement, dated as of March 27, 1998, by and
between Chart Marston Limited and IMI Marston Limited..... (H)
10.10 1998-2001 Labor Agreement, dated March 25, 1998, by and
between ALTEC and District Lodge 66 of the International
Association of Machinists and Aerospace Workers,
AFL-CIO...................................................
10.11 Agreement, effective July 21, 1996, by and between Process
Engineering and The International Brotherhood of
Boilermakers, Iron Ship Builders, Blacksmiths, Forgers &
Helpers Local Lodge No. 752 of the AFL-CIO................ (D)
*10.12 Employment Agreement, dated November 30, 1995, by and
between Chart Management Company, Inc. and James R.
Sadowski.................................................. (C)
*10.13 Salary Continuation Agreement, dated May 12, 1996, by and
between the Company and John T. Romain....................
*10.13.1 Amendment No. 1 to Salary Continuation Agreement, dated
December 4, 1998, by and between the Company and John T.
Romain....................................................

45

EXHIBIT
NO. DESCRIPTION
- --------------------- -----------

*10.14 Salary Continuation Agreement, dated May 22, 1996, by and
between the Company and Don A. Baines.....................
*10.14.1 Amendment No. 1 to Salary Continuation Agreement, dated
December 4, 1998, by and between the Company and Don A.
Baines....................................................
10.15 Credit Agreement, dated as of April 12, 1999, by and among
the Company, the Subsidiary Borrowers (as defined
therein), the Subsidiary Guarantors (as defined therein),
the Lenders (as defined therein), The Chase Manhattan
Bank, as Administrative Agent, and National City Bank, as
Documentation Agent....................................... (K)
10.15.1 Amendment No. 1, dated as of August 24, 1999, to the Credit
Agreement, dated as of April 12, 1999, by and among the
Company, the Subsidiary Borrowers (as defined therein),
the Subsidiary Guarantors (as defined therein), the
Lenders (as defined therein), The Chase Manhattan Bank, as
Administrative Agent, and National City Bank, as
Documentation Agent....................................... (L)
10.16 Indemnification and Warrant Purchase Agreement, dated as of
April 12, 1999, by and among the Company, MVE
Holdings, Inc. and each of the former members of MVE
Investors, LLC listed on the signature pages thereto...... (K)
10.17 Form of Promissory Note..................................... (K)
10.18 Form of Mortgage, Assignment of Rents, Security Agreement
and Fixture Filing........................................ (K)
10.19 Warrant Agreement, dated as of April 12, 1999, between the
Company and each of the persons listed on the signature
pages thereto............................................. (K)
10.20 Escrow Agreement, dated as of April 12, 1999, by and among
the Company, MVE Holdings, Inc., Chart Acquisition
Company, ACI Capital I, LLC, in its own capacity and, with
respect to the Class B Escrow Amount (as defined therein),
as agent and attorney-in-fact for each of the former
members of MVE Investors, LLC listed therein, and Firstar
Bank of Minnesota, N.A.................................... (K)
21.1 Subsidiaries of the Registrant..............................
23.1 Consent of Ernst & Young LLP................................
27.1 Financial Data Schedule.....................................

- ------------------------

* Management contract or compensation plan or arrangement identified pursuant
to Item 14(c) of this Form 10-K Annual Report.

(A) Incorporated herein by reference to the appropriate exhibit to the Company's
Registration Statement on Form S-1 (Reg. No. 333-35321).

(B) Incorporated herein by reference to the appropriate exhibit to the Company's
Registration Statement on Form S-1 (Reg. No. 33-52754).

(C) Incorporated herein by reference to the appropriate exhibit to the Company's
Form 10-K Annual Report for the year ended December 31, 1995.

(D) Incorporated herein by reference to the appropriate exhibit to the Company's
Form 10-K Annual Report for the year ended December 31, 1996.

(E) Incorporated herein by reference to the appropriate exhibit to the Company's
Registration Statement on Form S-8 (Reg. No. 333-32535).

(F) Incorporated herein by reference to the appropriate exhibit to the Company's
Form 8-K, dated July 31, 1997.

(G) Incorporated herein by reference to the appropriate exhibit to the Company's
Form 8-K, dated October 8, 1997.

46

(H) Incorporated herein by reference to the appropriate exhibit to the Company's
Form 8-K, dated March 27, 1998.

(I) Incorporated herein by reference to the appropriate exhibit to the Company's
Registration Statement on Form 8-A, filed June 3, 1998.

(J) Incorporated herein by reference to the appropriate exhibit to the Company's
Form 10-K Annual Report for the year ended December 31, 1999.

(K) Incorporated herein by reference to the appropriate exhibit to the Company's
Form 8-K, dated April 12, 1999.

(L) Incorporated herein by reference to the appropriate exhibit to the Company's
Form 8-K, dated August 24, 1999.

47