Attached files
| file | filename |
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| 8-K - PRAXAIR, INC. FORM 8-K - PRAXAIR INC | form8k.htm |
| EX-5 - CAHILL GORDON & REINDEL LLP OPINION LETTER - PRAXAIR INC | ex_5.htm |
Exhibit 1
Execution Version
TERMS AGREEMENT
July 30, 2012
Praxair, Inc.
39 Old Ridgebury Road
Danbury, Connecticut 06810-5113
Ladies and Gentlemen:
We, Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and Wells Fargo Securities, LLC (the “Representatives”), acting on behalf of the several underwriters named in Schedule I attached hereto (the “Underwriters”), understand that Praxair, Inc., a Delaware corporation (the “Company”), proposes to issue and sell $500,000,000 aggregate principal amount of its 2.20% Notes due 2022 (the “Offered Securities”), covered by the registration statement on Form S-3 (No. 333-162982) (the “Registration Statement”) filed by the Company. Subject to the terms and conditions set forth herein or incorporated by reference herein, the Underwriters named in Schedule I attached hereto agree to purchase, severally and not jointly, the Offered Securities in the amounts set forth opposite our respective names on such Schedule. The closing in respect of the purchase and sale of the Offered Securities shall occur on August 2, 2012 at 10:00 a.m. (the “Closing Date”) at the offices of Davis Polk & Wardwell LLP, 450 Lexington Avenue, New York, New York 10017.
All the provisions contained in the Praxair, Inc. Standard Underwriting Agreement Provisions (November 9, 2009 edition), other than the form of Delayed Delivery Contract attached thereto as Annex I and Terms Agreement attached thereto as Annex II (the “Standard Provisions”), a copy of which is filed as an exhibit to the Registration Statement, are incorporated herein by reference in their entirety and shall be deemed to be a part of this Terms Agreement to the same extent as if the Standard Provisions had been set forth in full herein. Terms defined in the Standard Provisions are used herein as therein defined.
For purposes of Sections 2 and 7 of the Standard Provisions, the only information furnished to the Company by any Underwriter for use in the U.S. Prospectus consists of the following information in the U.S. Prospectus furnished on behalf of each Underwriter: the last paragraph at the bottom of the prospectus supplement cover page concerning the terms of the offering by the Underwriters, and the information contained in the 3rd paragraph, the third and fourth sentences of the 6th paragraph, and the 7th and 8th paragraphs under the caption “Underwriting” in the prospectus supplement.
Date of Basic Prospectus: November 9, 2009
Date of Preliminary Prospectus Supplement: July 30, 2012
Date of Prospectus Supplement: July 30, 2012
Time of Sale: 3:17 p.m., New York City time on July 30, 2012
Names and Addresses of Representatives:
Credit Suisse Securities (USA) LLC
Eleven Madison Avenue
New York, New York 10010
Attention: LCD-IBD
J.P. Morgan Securities LLC
383 Madison Avenue
New York, New York 10179
Wells Fargo Securities, LLC
301 S. College Street, 6th Floor
Charlotte, North Carolina 28202
The Offered Securities shall have the following terms:
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Title:
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2.20% Notes due 2022
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Maturity:
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August 15, 2022
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Interest Rate:
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2.20% per annum
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Interest Payment Dates:
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Interest will be payable on February 15 and August 15 of each year, as applicable, commencing February 15, 2013.
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Redemption Provisions:
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The Company may redeem the notes at its option, at any time in whole or from time to time in part.
The redemption price for the notes to be redeemed on any redemption date that is prior to May 15, 2022 (date which is three months prior to final maturity of the notes) will be equal to the greater of: (1) the principal amount of the notes being redeemed plus accrued and unpaid interest to the redemption date or (2) the Make-Whole Amount for the notes being redeemed.
The redemption price for the notes to be redeemed on any redemption date that is on or after May 15, 2022 (date which is three months prior to final maturity of the notes) will be equal to 100% of the principal amount of the notes being redeemed on the redemption date, plus accrued and unpaid interest to the redemption date.
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“Make-Whole Amount” means, as determined by a Quotation Agent, the sum of the present values of the principal amount of the notes to be redeemed, together with the scheduled payments of interest (exclusive of interest to the redemption date) from the redemption date to the maturity date of the notes being redeemed, in each case discounted to the redemption date on a semi-annual basis, assuming a 360-day year consisting of twelve 30-day months, at the Adjusted Treasury Rate, plus accrued and unpaid interest on the principal amount of the notes being redeemed to the redemption date.
“Adjusted Treasury Rate” means, with respect, to any redemption date, the sum of (x) either (1) the yield, under the heading that represents the average for the immediately preceding week, appearing in the most recent published statistical release designated “H.15 (519)” or any successor publication that is published weekly by the Board of Governors of the Federal Reserve System and that establishes yields on actively traded United States Treasury securities adjusted to the Comparable Treasury Issue (if no maturity is within three months before or after the remaining term of the notes being redeemed, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue shall be determined and the Adjusted Treasury Rate shall be interpolated or extrapolated from such yields on a straight line basis, rounded to the nearest month) or (2) if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per year equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Price for such redemption date, in each case calculated on the third business day preceding the redemption date, and (y) 0.10%.
“Comparable Treasury Issue” means the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the remaining term from the redemption date to the maturity date of the notes being redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of notes.
“Comparable Treasury Price” means, with respect to any redemption date, if clause (ii) of the Adjusted Treasury Rate is applicable, the average of three, or such lesser number as is obtained by the indenture trustee, Reference Treasury Dealer Quotations for such redemption date.
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“Quotation Agent” means the Reference Treasury Dealer selected by the indenture trustee after consultation with Praxair.
“Reference Treasury Dealer” means each of Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and Wells Fargo Securities, LLC and their respective successors and assigns, and one other nationally recognized investment banking firm selected by Praxair that is a primary U.S. Government securities dealer.
“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the indenture trustee, of the bid and asked prices for the Comparable Treasury Issue, expressed in each case as a percentage of its principal amount, quoted in writing to the indenture trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such redemption date.
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Purchase Price:
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99.335% of the principal amount thereof
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Public Offering Price:
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99.785% of the principal amount thereof, plus accrued interest, if any, from August 2, 2012
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Additional Terms:
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None
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which terms shall be set forth in a pricing term sheet substantially in the form of Exhibit 1 attached hereto (the “Pricing Term Sheet”).
The Offered Securities will be made available for checking and packaging at the offices of Davis Polk & Wardwell LLP at least 24 hours prior to the Closing Date.
We represent that we are authorized to act for the several Underwriters named in Schedule I hereto in connection with this financing and any action under this agreement by any of us will be binding upon all the Underwriters.
This Terms Agreement may be executed in one or more counterparts, all of which counterparts shall constitute one and the same instrument.
[Signature pages follow]
-4-
If the foregoing is in accordance with your understanding of our agreement, kindly sign and return to us the enclosed duplicate hereof, whereupon it will become a binding agreement among the Company, and the several Underwriters in accordance with its terms.
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Very truly yours,
CREDIT SUISSE SECURITIES (USA) LLC
J.P. MORGAN SECURITIES LLC
WELLS FARGO SECURITIES, LLC
On behalf of themselves and
as Representatives of the
Several Underwriters
By: Credit Suisse Securities (USA) LLC
By: /s/ Sharon Harrison
Name: Sharon Harrison
Title: Director
By: J.P. Morgan Securities LLC
By: /s/ Stephen L. Sheiner
Name: Stephen L. Sheiner
Title: Executive Director
By: Wells Fargo Securities, LLC
By: /s/ Carolyn Hurley
Name: Carolyn Hurley
Title: Director
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[Signature Page to Terms Agreement]
The foregoing Terms Agreement
is hereby confirmed as of the
date first above written
PRAXAIR, INC.
By: /s/ Timothy S. Heenan
Name: Timothy S. Heenan
Title: Vice President and Treasurer
[Signature Page to Terms Agreement]
SCHEDULE I
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Underwriters
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Amount of
Offered Securities
to be Purchased
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Credit Suisse Securities (USA) LLC
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$ | 125,000,000 | ||
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J.P. Morgan Securities LLC
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125,000,000 | |||
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Wells Fargo Securities, LLC
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125,000,000 | |||
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Citigroup Global Markets Inc.
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15,625,000 | |||
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Deutsche Bank Securities Inc.
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15,625,000 | |||
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HSBC Securities (USA) Inc.
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15,625,000 | |||
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Merrill Lynch, Pierce, Fenner & Smith
Incorporated
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15,625,000 | |||
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Mitsubishi UFJ Securities (USA), Inc.
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15,625,000 | |||
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RBS Securities Inc.
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15,625,000 | |||
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SMBC Nikko Capital Markets Limited
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15,625,000 | |||
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The Williams Capital Group, L.P.
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15,625,000 | |||
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Total
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$ | 500,000,000 | ||
Exhibit 1 – Pricing Term Sheet
$500,000,000 2.20% Notes due 2022
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Issuer:
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Praxair, Inc.
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Principal Amount:
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$500,000,000
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CUSIP / ISIN:
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74005PBB9 / US74005PBB94
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Title of Securities:
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2.20% Notes due 2022
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Trade Date:
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July 30, 2012
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Original Issue Date (Settlement Date):
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August 2, 2012
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Maturity Date:
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August 15, 2022
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Benchmark Treasury:
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T 1.750% due May 15, 2022
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Benchmark Treasury Price and Yield:
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102-7+ and 1.504%
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Spread to Benchmark Treasury:
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72 basis points
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Yield to Maturity:
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2.224%
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Interest Rate:
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2.200% per annum
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Public Offering Price (Issue Price):
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99.785% of the Principal Amount thereof
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Interest Payment Dates:
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Semi-annually in arrears on each February 15 and August 15 commencing February 15, 2013
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Redemption Provisions:
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Make-Whole Call:
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Adjusted Treasury Rate plus 10 basis points prior to May 15, 2022
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Par Call:
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On or after May 15, 2022
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Joint Bookrunners:
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Credit Suisse Securities (USA) LLC
J.P. Morgan Securities LLC
Wells Fargo Securities, LLC
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Co-Managers:
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Citigroup Global Markets Inc.
Deutsche Bank Securities Inc.
HSBC Securities (USA) Inc.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Mitsubishi UFJ Securities (USA), Inc.
RBS Securities Inc.
SMBC Nikko Capital Markets Limited
The Williams Capital Group, L.P.
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The issuer has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling Credit Suisse Securities (USA) LLC toll free at 1-800-221-1037, J.P. Morgan Securities LLC collect at 1-212-834-4533 or Wells Fargo Securities, LLC toll free at 1-800-326-5897.
Any disclaimers or other notices that may appear below are not applicable to this communication and should be disregarded. Such disclaimers or other notices were automatically generated as a result of this communication being sent via Bloomberg or another email system.