10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2018

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to

PRAXAIR, INC.

(Exact name of registrant as specified in its charter)

DELAWARE

(State or other jurisdiction of incorporation)

1-11037	06-1249050
(Commission File Number)	(IRS Employer Identification No.)
10 Riverview Drive, DANBURY, CT	06810-6268
(Address of principal executive offices)	(Zip Code)

(203) 837-2000

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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

Title of each class: Registered on:

Common Stock ($0.01 par value) New York Stock Exchange

1.50% Euro notes due 2020 New York Stock Exchange

1.20% Euro notes due 2024 New York Stock Exchange

1.625% Euro notes due 2025 New York Stock Exchange

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.    YesýNo¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YesýNo¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	ý	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	¨
		Emerging growth company	¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.			¨

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     Yes¨Noý

At March 31, 2018, 287,369,483 shares of common stock ($0.01 par value) of the Registrant were outstanding.

INDEX
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Statements of Income - Praxair, Inc. and Subsidiaries Quarters Ended March 31, 2018 and 2017 (Unaudited)	3
	Consolidated Statements of Comprehensive Income - Praxair, Inc. and Subsidiaries Quarters Ended March 31, 2018 and 2017 (Unaudited)	4
	Condensed Consolidated Balance Sheets - Praxair, Inc. and Subsidiaries March 31, 2018 and December 31, 2017 (Unaudited)	5
	Condensed Consolidated Statements of Cash Flows - Praxair, Inc. and Subsidiaries Three Months Ended March 31, 2018 and 2017 (Unaudited)	6
	Notes to Condensed Consolidated Financial Statements - Praxair, Inc. and Subsidiaries (Unaudited)	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	43
Item 4.	Controls and Procedures	43
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	44
Item 1A.	Risk Factors	44
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	44
Item 3.	Defaults Upon Senior Securities	44
Item 4.	Mine Safety Disclosures	44
Item 5.	Other Information	44
Item 6.	Exhibits	45
Signature		46

PRAXAIR, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Millions of dollars, except per share data)

(UNAUDITED)

	Quarter Ended March 31,
	2018			2017
SALES	$	2,999		$	2,728
Cost of sales, exclusive of depreciation and amortization	1,677			1,549
Selling, general and administrative	310			290
Depreciation and amortization	311			287
Research and development	24			23
Transaction costs and other charges	19			6
Other income (expense) - net	(5		)	(6		)
OPERATING PROFIT	653			567
Interest expense - net	46			41
Net pension and OPEB cost (benefit), excluding service cost	2			(15		)
INCOME BEFORE INCOME TAXES AND EQUITY INVESTMENTS	605			541
Income taxes	148			149
INCOME BEFORE EQUITY INVESTMENTS	457			392
Income from equity investments	15			12
NET INCOME (INCLUDING NONCONTROLLING INTERESTS)	472			404
Less: noncontrolling interests	(10		)	(15		)
NET INCOME - PRAXAIR, INC.	$	462		$	389
PER SHARE DATA - PRAXAIR, INC. SHAREHOLDERS
Basic earnings per share	$	1.61		$	1.36
Diluted earnings per share	$	1.59		$	1.35
Cash dividends per share	$	0.825		$	0.7875
WEIGHTED AVERAGE SHARES OUTSTANDING (000’s):
Basic shares outstanding	287,504			285,509
Diluted shares outstanding	290,809			287,384

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

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PRAXAIR, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Millions of dollars)

(UNAUDITED)

	Quarter Ended March 31,
	2018			2017
NET INCOME (INCLUDING NONCONTROLLING INTERESTS)	$	472		$	404
OTHER COMPREHENSIVE INCOME (LOSS)
Translation adjustments:
Foreign currency translation adjustments	106			317
Income taxes	9			3
Translation adjustments	115			320
Funded status - retirement obligations (Note 11):
Retirement program remeasurements	1			(3		)
Reclassifications to net income	17			4
Income taxes	(4		)	(1		)
Funded status - retirement obligations	14			—
Derivative instruments (Note 6):
Current quarter unrealized gain (loss)	—			(1		)
Reclassifications to net income	—			—
Income taxes	—			1
Derivative instruments	—			—
TOTAL OTHER COMPREHENSIVE INCOME (LOSS)	129			320
COMPREHENSIVE INCOME (LOSS) (INCLUDING NONCONTROLLING INTERESTS)	601			724
Less: noncontrolling interests	(21		)	(20		)
COMPREHENSIVE INCOME (LOSS) - PRAXAIR, INC.	$	580		$	704

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

4

PRAXAIR, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Millions of dollars)

(UNAUDITED)

	March 31, 2018			December 31, 2017
ASSETS
Cash and cash equivalents	$	545		$	617
Accounts receivable - net	1,900			1,804
Inventories	619			614
Prepaid and other current assets	265			250
TOTAL CURRENT ASSETS	3,329			3,285
Property, plant and equipment (less accumulated depreciation of $14,103 in 2018 and $13,819 in 2017)	12,113			12,057
Goodwill	3,274			3,233
Other intangible assets - net	547			553
Other long-term assets	1,329			1,308
TOTAL ASSETS	$	20,592		$	20,436
LIABILITIES AND EQUITY
Accounts payable	$	988		$	972
Short-term debt	527			238
Current portion of long-term debt	979			979
Other current liabilities	1,040			1,118
TOTAL CURRENT LIABILITIES	3,534			3,307
Long-term debt	7,336			7,783
Other long-term liabilities	2,825			2,824
TOTAL LIABILITIES	13,695			13,914
Commitments and contingencies (Note 12)
Redeemable noncontrolling interests (Note 14)	13			11
Praxair, Inc. Shareholders’ Equity:
Common stock $0.01 par value, authorized - 800,000,000 shares, issued 2018 and 2017 - 383,230,625 shares	4			4
Additional paid-in capital	4,049			4,084
Retained earnings	13,447			13,224
Accumulated other comprehensive income (loss) (Note 14)	(3,980		)	(4,098		)
Less: Treasury stock, at cost (2018 - 95,861,142 shares and 2017 - 96,453,634 shares)	(7,152		)	(7,196		)
Total Praxair, Inc. Shareholders’ Equity	6,368			6,018
Noncontrolling interests	516			493
TOTAL EQUITY	6,884			6,511
TOTAL LIABILITIES AND EQUITY	$	20,592		$	20,436

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

5

PRAXAIR, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Millions of dollars)

(UNAUDITED)

	Three months ended March 31,
	2018			2017
OPERATIONS
Net income - Praxair, Inc.	$	462		$	389
Noncontrolling interests	10			15
Net income (including noncontrolling interests)	472			404
Adjustments to reconcile net income to net cash provided by operating activities:
Transaction costs and other charges, net of payments	14			6
Depreciation and amortization	311			287
Deferred income taxes	11			22
Share-based compensation	4			12
Working capital:
Accounts receivable	(82		)	(49		)
Inventory	(2		)	(2		)
Prepaid and other current assets	(19		)	(13		)
Payables and accruals	(67		)	(42		)
Pension contributions	(4		)	(3		)
Long-term assets, liabilities and other	50			88
Net cash provided by operating activities	688			710
INVESTING
Capital expenditures	(325		)	(327		)
Acquisitions, net of cash acquired	—			(1		)
Divestitures and asset sales	7			4
Net cash used for investing activities	(318		)	(324		)
FINANCING
Short-term debt borrowings (repayments) - net	288			(24		)
Long-term debt borrowings	—			7
Long-term debt repayments	(503		)	(156		)
Issuances of common stock	29			26
Purchases of common stock	—			(11		)
Cash dividends - Praxair, Inc. shareholders	(237		)	(225		)
Noncontrolling interest transactions and other	(6		)	(13		)
Net cash provided by (used for) financing activities	(429		)	(396		)
Effect of exchange rate changes on cash and cash equivalents	(13		)	5
Change in cash and cash equivalents	(72		)	(5		)
Cash and cash equivalents, beginning-of-period	617			524
Cash and cash equivalents, end-of-period	$	545		$	519

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

6

INDEX TO NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Notes to Condensed Consolidated Financial Statements - Praxair, Inc. and Subsidiaries (Unaudited)

Note 1. Summary of Significant Accounting Policies	8
Note 2. Transaction Costs and Other Charges	9
Note 3. Acquisitions	9
Note 4. Supplemental Information	9
Note 5. Debt	10
Note 6. Financial Instruments	11
Note 7. Fair Value Disclosures	13
Note 8. Earnings Per Share – Praxair, Inc. Shareholders	14
Note 9. Goodwill and Other Intangible Assets	15
Note 10. Share-Based Compensation	16
Note 11. Retirement Programs	18
Note 12. Commitments and Contingencies	19
Note 13. Segments	20
Note 14. Equity and Noncontrolling Interests	21
Note 15. Revenue Recognition	22
Note 16. Income Taxes	25
Note 17. Proposed Business Combination with Linde AG	25

7

PRAXAIR, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. Summary of Significant Accounting Policies

Presentation of Condensed Consolidated Financial Statements- In the opinion of Praxair, Inc. (Praxair) management, the accompanying condensed consolidated financial statements include all adjustments necessary for a fair presentation of the results for the interim periods presented and such adjustments are of a normal recurring nature. The accompanying condensed consolidated financial statements should be read in conjunction with the notes to the consolidated financial statements of Praxair, Inc. and subsidiaries in Praxair’s 2017 Annual Report on Form 10-K. There have been no material changes to the company’s significant accounting policies during 2018.

Accounting Standards Implemented in 2018

• Revenue Recognition – In May 2014, the FASB issued updated guidance on the reporting and disclosure of revenue. Effective January 1, 2018, Praxair has adopted this guidance using the modified retrospective transition method. No material differences in revenue recognition accounting were identified under the new guidance compared with the Company's historic revenue recognition accounting (see Note 15).

• Classification of Certain Cash Receipts and Cash Payments – In August 2016, the FASB issued updated guidance on the classification of certain cash receipts and cash payments within the statement of cash flows. The update provides accounting guidance for specific cash flow issues with the objective of reducing diversity in practice. The adoption of this guidance did not have a material impact on the financial statements.

• Intra-Entity Asset Transfers – In October 2016, the FASB issued updated guidance for income tax accounting of intra-entity transfers of assets other than inventory. The update requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory in the period when the transfer occurs. The adoption of this guidance did not have a material impact on the financial statements.

• Pension Costs - In March 2017, the FASB issued updated guidance on the presentation of net periodic pension cost and net periodic postretirement benefit cost. The new guidance requires the service cost component be reported in the same line item or items as other compensation costs arising from services rendered by employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and not included within operating profit. This guidance was adopted in the first quarter 2018. Accordingly, non-service related components of net periodic pension and postretirement benefit costs were reclassified out of "Operating Profit" to "Net pension and OPEB cost (benefit), excluding service cost" using the practical expedient to use the amounts disclosed in the retirement benefits note for the prior comparative periods as the estimation basis for applying the retrospective presentation requirements (see Note 11).

Accounting Standards to be Implemented

• Leases – In February 2016, the FASB issued updated guidance on the accounting and financial statement presentation of leases. The new guidance requires lessees to recognize a right-of-use asset and lease liability for all leases, except those that meet certain scope exceptions, and would require expanded quantitative and qualitative disclosures. This guidance will be effective for Praxair beginning in the first quarter 2019 and requires companies to transition using a modified retrospective approach. Praxair is in the process of implementing the new guidance and will provide updates on the expected impact to Praxair in future filings, as appropriate.

• Credit Losses on Financial Instruments –In June 2016, the FASB issued an update on the measurement of credit losses. The guidance introduces a new accounting model for expected credit losses on financial instruments, including trade receivables, based on estimates of current expected credit losses. This guidance will be effective for Praxair beginning in the first quarter 2020, with early adoption permitted beginning in the first quarter 2019 and requires companies to apply the change in accounting on a prospective basis. We are currently evaluating the impact this update will have on our consolidated financial statements.

• Simplifying the Test for Goodwill Impairment – In January 2017, the FASB issued updated guidance on the measurement of goodwill. The new guidance eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge. The guidance will be effective for Praxair beginning in the first quarter 2020. Praxair does not expect this guidance to have a material impact.

8

• Derivatives and Hedging - In August 2017, the FASB issued updated guidance on accounting for hedging activities. The new guidance changes both the designation and measurement for qualifying hedging relationships and the presentation of hedge results. This guidance will be effective for Praxair beginning in the first quarter 2019, with early adoption optional. Praxair is currently evaluating the impact this update will have on our consolidated financial statements.

• Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income – In February 2018, the FASB issued updated guidance which allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. This new guidance will be effective for Praxair beginning in the first quarter 2019 on a retrospective basis, with early adoption optional. Praxair is currently assessing the impact and timing of adoption.

Reclassifications – Certain prior years’ amounts have been reclassified to conform to the current year’s presentation including reclassifications on the consolidated statements of income and segment operating profit relating to the adoption of accounting guidance on the presentation of net periodic pension and postretirement benefit costs.

2. Transaction Costs and Other Charges

On June 1, 2017 Praxair and Linde AG ("Linde") entered into a business combination agreement, pursuant to which they agreed to combine their respective businesses subject to shareholder and regulatory approvals (see Note 17). In the first quarters of 2018 and 2017, Praxair incurred transaction costs and other charges primarily in connection with the intended business combination totaling $19 million ($18 million after-tax and noncontrolling interests or $0.06 per diluted share) and $6 million after-tax ($0.02 per diluted share), respectively.

Classification in the condensed consolidated financial statements

The costs are shown within operating profit in a separate line item on the consolidated statements of income. On the condensed consolidated statement of cash flows, the impact of these costs, net of cash payments, is shown as an adjustment to reconcile net income to net cash provided by operating activities. In Note 13 - Segments, Praxair excluded these costs from its management definition of segment operating profit; a reconciliation of segments operating profit to consolidated operating profit is shown within the segment operating profit table.

3. Acquisitions

Acquisition activity was immaterial in both the first quarter of 2018 and 2017.

4. Supplemental Information

Inventories

The following is a summary of Praxair’s consolidated inventories:

(Millions of dollars)	March 31, 2018		December 31, 2017
Inventories
Raw materials and supplies	$	223	$	224
Work in process	54		57
Finished goods	342		333
Total inventories	$	619	$	614

Long-term receivables

Long-term receivables are not material and are largely reserved. Such long-term receivables are included within other long-term assets in the condensed consolidated balance sheets and totaled $44 million and $54 million at March 31, 2018 and December 31, 2017, respectively. These amounts are net of reserves of $54 million and $51 million, respectively. The amounts in both periods relate primarily to government receivables in Brazil and other long-term notes receivable from customers. Collectability is reviewed regularly and uncollectible amounts are written off as appropriate.

9

5. Debt

The following is a summary of Praxair’s outstanding debt at March 31, 2018 and December 31, 2017:

(Millions of dollars)	March 31, 2018			December 31, 2017
SHORT-TERM
Commercial paper and U.S. bank borrowings	$	492		$	202
Other bank borrowings (primarily international)	35			36
Total short-term debt	527			238
LONG-TERM (a)
U.S. borrowings (U.S. dollar denominated unless otherwise noted)
1.20% Notes due 2018 (b)	—			498
1.25% Notes due 2018 (c)	474			475
4.50% Notes due 2019	599			599
1.90% Notes due 2019	500			500
1.50% Euro-denominated notes due 2020	737			717
2.25% Notes due 2020	299			299
4.05% Notes due 2021	498			498
3.00% Notes due 2021	497			497
2.45% Notes due 2022	598			598
2.20% Notes due 2022	498			498
2.70% Notes due 2023	498			498
1.20% Euro-denominated notes due 2024	675			658
2.65% Notes due 2025	397			397
1.625% Euro-denominated notes due 2025	610			594
3.20% Notes due 2026	725			725
3.55% Notes due 2042	662			662
Other	9			12
International bank borrowings	35			33
Obligations under capital leases	4			4
	8,315			8,762
Less: current portion of long-term debt	(979		)	(979		)
Total long-term debt	7,336			7,783
Total debt	$	8,842		$	9,000

(a) Amounts are net of unamortized discounts, premiums and/or debt issuance costs as applicable.

(b) In March 2018, Praxair repaid $500 million of 1.20% notes that became due.

(c) March 31, 2018 and December 31, 2017 include a $1 million fair value decrease and a less than $1 million increase, respectively, related to hedge accounting. See Note 6 for additional information.

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6. Financial Instruments

In its normal operations, Praxair is exposed to market risks relating to fluctuations in interest rates, foreign currency exchange rates, energy costs and to a lesser extent precious metal prices. The objective of financial risk management at Praxair is to minimize the negative impact of such fluctuations on the company’s earnings and cash flows. To manage these risks, among other strategies, Praxair routinely enters into various derivative financial instruments (“derivatives”) including interest-rate swap and treasury rate lock agreements, currency-swap agreements, forward contracts, currency options, and commodity-swap agreements. These instruments are not entered into for trading purposes and Praxair only uses commonly traded and non-leveraged instruments.

There are three types of derivatives that the company enters into: (i) those relating to fair-value exposures, (ii) those relating to cash-flow exposures, and (iii) those relating to foreign currency net investment exposures. Fair-value exposures relate to recognized assets or liabilities, and firm commitments; cash-flow exposures relate to the variability of future cash flows associated with recognized assets or liabilities, or forecasted transactions; and net investment exposures relate to the impact of foreign currency exchange rate changes on the carrying value of net assets denominated in foreign currencies.

When a derivative is executed and hedge accounting is appropriate, it is designated as either a fair-value hedge, cash-flow hedge, or a net investment hedge. Currently, Praxair designates all interest-rate and treasury-rate locks as hedges for accounting purposes; however, currency contracts are generally not designated as hedges for accounting purposes unless they are related to forecasted transactions. Whether designated as hedges for accounting purposes or not, all derivatives are linked to an appropriate underlying exposure. On an ongoing basis, the company assesses the hedge effectiveness of all derivatives designated as hedges for accounting purposes to determine if they continue to be highly effective in offsetting changes in fair values or cash flows of the underlying hedged items. If it is determined that the hedge is not highly effective, then hedge accounting will be discontinued prospectively.

Counterparties to Praxair’s derivatives are major banking institutions with credit ratings of investment grade or better and no collateral is required, and there are no significant risk concentrations. Management believes the risk of incurring losses on derivative contracts related to credit risk is remote and any losses would be immaterial.

The following table is a summary of the notional amount and fair value of derivatives outstanding at March 31, 2018 and December 31, 2017 for consolidated subsidiaries:

					Fair Value
	Notional Amounts				Assets				Liabilities
(Millions of dollars)	March 31, 2018		December 31, 2017		March 31, 2018		December 31, 2017		March 31, 2018		December 31, 2017
Derivatives Not Designated as Hedging Instruments:
Currency contracts:
Balance sheet items (a)	$	2,288	$	2,693	$	12	$	16	$	5	$	16
Derivatives Designated as Hedging Instruments:
Currency contracts:
Balance sheet items (a)	$	—	$	38	$	—	$	—	$	—	$	2
Forecasted purchases (a)	5		4		—		1		—		—
Interest rate contracts:
Interest rate swaps (a)	475		475		—		—		1		—
Total Hedges	$	480	$	517	$	—	$	1	$	1	$	2
Total Derivatives	$	2,768	$	3,210	$	12	$	17	$	6	$	18

(a) Assets are recorded in prepaid and other current assets, and liabilities are recorded in other current liabilities.

Currency Contracts

Balance Sheet Items

Foreign currency contracts related to balance sheet items consist of forward contracts entered into to manage the exposure to fluctuations in foreign-currency exchange rates on recorded balance sheet assets and liabilities denominated in currencies other than the functional currency of the related operating unit. Certain forward currency contracts are entered into to protect underlying monetary assets and liabilities denominated in foreign currencies from foreign exchange risk and are not designated

11

as hedging instruments. The fair value adjustments on these contracts are offset by the fair value adjustments recorded on the underlying monetary assets and liabilities. Praxair also enters into forward currency contracts, which are designated as hedging instruments, to limit the cash flow exposure on certain foreign-currency denominated intercompany loans. The fair value adjustments on these contracts are recorded to AOCI, with the effective portion immediately reclassified to earnings to offset the fair value adjustments on the underlying debt instrument.

Forecasted Purchases

Foreign currency contracts related to forecasted purchases consist of forward contracts entered into to manage the exposure to fluctuations in foreign-currency exchange rates on forecasted purchases of capital-related equipment and services denominated in currencies other than the functional currency of the related operating units. These forward contracts were designated and accounted for as cash flow hedges.

Net Investment Hedge

In 2014 Praxair designated the €600 million ($737 million as of March 31, 2018) 1.50% Euro-denominated notes due 2020 and the €500 million ($610 million as of March 31, 2018) 1.625% Euro-denominated notes due 2025, as a hedge of the net investment position in its European operations. In 2016 Praxair designated an incremental €550 million ($675 million as of March 31, 2018) 1.20% Euro-denominated notes due 2024 as an additional hedge of the net investment position in its European operations. On December 22, 2017, the U.S. government enacted the Tax Cuts and Jobs Act. In response to the decrease in the tax rate from 35% to 21%, as of March 31, 2018 the Company has de-designated €130 million of its Euro-denominated notes, which were previously designated as a hedge of the net investment position in its European operations. These Euro-denominated debt instruments reduce the company's exposure to changes in the currency exchange rate on investments in foreign subsidiaries with Euro functional currencies. Since hedge inception, exchange rate movements have reduced long-term debt by $51 million (long-term debt increased by $46 million during the first quarter of 2018), with the offsetting gain shown within the cumulative translation component of AOCI in the condensed consolidated balance sheets and the consolidated statements of comprehensive income.

Interest Rate Contracts

Outstanding Interest Rate Swaps

At March 31, 2018, Praxair had one outstanding interest rate swap agreement with a $475 million notional amount related to the $475 million1.25% notes that mature in 2018. The interest rate swap effectively converts fixed-rate interest to variable-rate interest and is designated as a fair value hedge. Fair value adjustments are recognized in earnings along with an equally offsetting charge / benefit to earnings for the changes in the fair value of the underlying debt instrument. At March 31, 2018, $1 million was recognized as a decrease in the fair value of these notes (increase in the fair value of less than $1 million at December 31, 2017).

Terminated Treasury Rate Locks

The following table summarizes the unrecognized gains (losses) related to terminated treasury rate lock contracts:

	Year Terminated	Original Gain / (Loss)			Unrecognized Gain / (Loss) (a)
(Millions of dollars)					March 31, 2018			December 31, 2017
Treasury Rate Locks
Underlying debt instrument:
$500 million 2.20% fixed-rate notes that mature in 2022 (b)	2012	$	(2	)	$	(1	)	$	(1	)
$500 million 3.00% fixed-rate notes that mature in 2021 (b)	2011	(11		)	(4		)	(4		)
$600 million 4.50% fixed-rate notes that mature in 2019 (b)	2009	16			3			3
Total - pre-tax					$	(2	)	$	(2	)
Less: income taxes					1			1
After- tax amounts					$	(1	)	$	(1	)

(a) The unrecognized gains / (losses) for the treasury rate locks are shown in accumulated other comprehensive income (“AOCI”) and are being recognized on a straight line basis to interest expense – net over the term of the underlying debt agreements. Refer to the table below summarizing the impact on the company’s consolidated statements of income and AOCI for current period gain (loss) recognition.

(b) The notional amount of the treasury rate lock contracts are equal to the underlying debt instrument with the exception of the treasury rate lock contract entered into to hedge the $600 million4.50% fixed-rate notes that mature in 2019. The notional amount of this contract was $500 million.

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The following table summarizes the impact of the company’s derivatives on the consolidated statements of income:

	Amount of Pre-Tax Gain (Loss) Recognized in Earnings *
	Quarter Ended March 31,
(Millions of dollars)	2018		2017
Derivatives Not Designated as Hedging Instruments
Currency contracts:
Balance sheet items
Debt-related	$	36	$	79
Other balance sheet items	2		1
Total	$	38	$	80

* The gains (losses) on balance sheet items are offset by gains (losses) recorded on the underlying hedged assets and liabilities. Accordingly, the gains (losses) for the derivatives and the underlying hedged assets and liabilities related to debt items are recorded in the consolidated statements of income as interest expense-net. Other balance sheet items and anticipated net income gains (losses) are recorded in the consolidated statements of income as other income (expenses)-net.

The following table summarizes the impacts of the company's derivatives designated as hedging instruments that impact AOCI:

Derivatives Designated as Hedging Instruments **

	Quarter Ended
	Amount of Gain  (Loss) Recognized in AOCI					Amount of Gain  (Loss) Reclassified from AOCI to the Consolidated Statement of Income
(Millions of dollars)	March 31, 2018		March 31, 2017			March 31, 2018		March 31, 2017
Currency contracts:
Balance sheet items	$	—	$	(1	)	$	—	$	—
Net investment hedge	—		—			—		—
Forecasted purchases	—		—			—		—
Interest rate contracts:
Treasury rate lock contracts	—		—			—		—
Total - pre tax	$	—	$	(1	)	$	—	$	—
Less: income taxes	—		1			—		—
Total - Net of Taxes	$	—	$	—		$	—	$	—

**The gains (losses) on net investment hedges are recorded as a component of AOCI within foreign currency translation adjustments in the condensed consolidated balance sheets and the condensed consolidated statements of comprehensive income. The gains (losses) on treasury rate locks are recorded as a component of AOCI within derivative instruments in the condensed consolidated balance sheets and the condensed consolidated statements of comprehensive income. There was no ineffectiveness for these instruments during 2018 or 2017. The gains (losses) on net investment hedges are reclassified to earnings only when the related currency translation adjustments are required to be reclassified, usually upon sale or liquidation of the investment. The gains (losses) for interest rate contracts are reclassified to earnings as interest expense –net on a straight-line basis over the remaining maturity of the underlying debt. Net losses of less than $1 million are expected to be reclassified to earnings during the next twelve months.

7. Fair Value Disclosures

The fair value hierarchy prioritizes the input to valuation techniques used to measure fair value into three broad levels as follows:

Level 1 – quoted prices in active markets for identical assets or liabilities

Level 2 – quoted prices for similar assets and liabilities in active markets or inputs that are observable

Level 3 – inputs that are unobservable (for example cash flow modeling inputs based on assumptions)

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table summarizes assets and liabilities measured at fair value on a recurring basis:

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	Fair Value Measurements Using
	Level 1		Level 2				Level 3
(Millions of dollars)	March 31, 2018	December 31, 2017	March 31, 2018		December 31, 2017		March 31, 2018	December 31, 2017
Assets
Derivatives	—	—	$	12	$	17	—	—
Liabilities
Derivatives	—	—	$	6	$	18	—	—

The fair values of the derivative assets and liabilities are based on market prices obtained from independent brokers or determined using quantitative models that use as their basis readily observable market parameters that are actively quoted and can be validated through external sources, including third-party pricing services, brokers and market transactions. Investments are marketable securities traded on an exchange.

The fair values of cash and cash equivalents, short-term debt, accounts receivable-net, and accounts payable approximate carrying amounts because of the short maturities of these instruments. The fair value of long-term debt is estimated based on the quoted market prices for similar issues, which is deemed a level 2 measurement. At March 31, 2018, the estimated fair value of Praxair’s long-term debt portfolio was $8,380 million versus a carrying value of $8,315 million. At December 31, 2017, the estimated fair value of Praxair’s long-term debt portfolio was $8,969 million versus a carrying value of $8,762 million. Differences from carrying amounts are attributable to interest-rate changes subsequent to when the debt was issued.

8. Earnings Per Share – Praxair, Inc. Shareholders

Basic earnings per share is computed by dividing Net income – Praxair, Inc. for the period by the weighted average number of Praxair common shares outstanding. Diluted earnings per share is computed by dividing Net income – Praxair, Inc. for the period by the weighted average number of Praxair common shares outstanding and dilutive common stock equivalents, as follows:

	Quarter Ended March 31,
	2018		2017
Numerator (Millions of dollars)
Net income - Praxair, Inc.	$	462	$	389
Denominator (Thousands of shares)
Weighted average shares outstanding	287,175		285,140
Shares earned and issuable under compensation plans	329		369
Weighted average shares used in basic earnings per share	287,504		285,509
Effect of dilutive securities
Stock options and awards	3,305		1,875
Weighted average shares used in diluted earnings per share	290,809		287,384
Basic Earnings Per Share	$	1.61	$	1.36
Diluted Earnings Per Share	$	1.59	$	1.35

There were no antidilutive shares for the quarter ended March 31, 2018. Stock options of 4,673,805 were antidilutive and therefore excluded in the computation of diluted earnings per share for the quarter ended March 31, 2017.

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9. Goodwill and Other Intangible Assets

Changes in the carrying amount of goodwill for the three months ended March 31, 2018 were as follows:

(Millions of dollars)	North America		South America			Europe		Asia		Surface Technologies		Total
Balance, December 31, 2017	$	2,202	$	129		$	698	$	61	$	143	$	3,233
Acquisitions	—		—			—		—		—		—
Purchase adjustments & other	12		—			—		—		—		12
Foreign currency translation	3		(1		)	23		2		2		29
Balance, March 31, 2018	$	2,217	$	128		$	721	$	63	$	145	$	3,274

Praxair has performed its goodwill impairment tests annually during the second quarter of each year, and historically has determined that the fair value of each of its reporting units was substantially in excess of its carrying value (refer to Note 1 to the consolidated financial statements of Praxair's 2017 Annual Report on Form 10-K). As a result, no impairment was recorded. There were no indicators of impairment through March 31, 2018.

Changes in the carrying amounts of other intangibles for the three months ended March 31, 2018 were as follows:

(Millions of dollars)	Customer & License/Use Agreements			Non-compete Agreements			Patents & Other			Total
Cost:
Balance, December 31, 2017	$	772		$	28		$	52		$	852
Additions	—			—			—			—
Foreign currency translation	8			—			—			8
Other*	(19		)	(5		)	—			(24		)
Balance, March 31, 2018	$	761		$	23		$	52		$	836
Less: Accumulated amortization
Balance, December 31, 2017	$	(260	)	$	(18	)	$	(21	)	$	(299	)
Amortization expense	(9		)	(1		)	(1		)	(11		)
Foreign currency translation	(3		)	—			—			(3		)
Other*	19			5			—			24
Balance, March 31, 2018	$	(253	)	$	(14	)	$	(22	)	$	(289	)
Net balance at March 31, 2018	$	508		$	9		$	30		$	547

* Other primarily relates to the write-off of fully amortized assets.

There are no expected residual values related to these intangible assets. The remaining weighted-average amortization period for intangible assets is approximately 16 years.

Total estimated annual amortization expense is as follows:

(Millions of dollars)
Remaining 2018	$	33
2019	44
2020	42
2021	40
2022	39
Thereafter	349
	$	547

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10. Share-Based Compensation

Share-based compensation expense of $4 million (benefit of $10 million after-tax) and $12 million ($4 million after-tax) was recognized during the quarters ended March 31, 2018 and 2017, respectively. The 2018 and 2017 quarters include $13 million and $4 million of excess tax benefits, respectively. The expense was recorded primarily in selling, general and administrative expenses. There was no share-based compensation cost that was capitalized. For further details regarding Praxair’s share-based compensation arrangements and prior-year grants, refer to Note 15 to the consolidated financial statements of Praxair’s 2017 Annual Report on Form 10-K.

Stock Options

The weighted-average fair value of options granted during the three months ended March 31, 2018 was $19.29 ($12.40 in 2017) based on the Black-Scholes Options-Pricing model. The increase in grant date fair value year-over-year was primarily attributable to an increase in the company's stock price.

The following weighted-average assumptions were used to value the grants in 2018 and 2017:

	Three months ended March 31,
	2018		2017
Dividend yield	2.1	%	2.7	%
Volatility	14.4	%	14.0	%
Risk-free interest rate	2.67	%	2.13	%
Expected term years	5		6

The following table summarizes option activity under the plans as of March 31, 2018 and changes during the three-month period then ended (averages are calculated on a weighted basis; life in years; intrinsic value expressed in millions):

	Number of Options  (000’s)		Average Exercise Price		Average Remaining Life	Aggregate Intrinsic Value
Outstanding at January 1, 2018	10,787		$	108.70
Granted	1,625		154.00
Exercised	(901	)	90.70
Cancelled or Expired	(16	)	115.09
Outstanding at March 31, 2018	11,495		116.50		6.7	$	335
Exercisable at March 31, 2018	7,755		$	109.67	5.5	$	269

The aggregate intrinsic value represents the difference between the company’s closing stock price of $144.30 as of March 31, 2018 and the exercise price multiplied by the number of in the money options outstanding as of that date. The total intrinsic value of stock options exercised during the quarter ended March 31, 2018 was $63 million ($18 million during the same period in 2017).

Cash received from option exercises under all share-based payment arrangements for the quarter ended March 31, 2018 was $78 million ($19 million for the same period in 2017). The cash tax benefit realized from share-based compensation totaled $14 million for the quarter ended March 31, 2018 ($8 million for the same period in 2017).

As of March 31, 2018, $40 million of unrecognized compensation cost related to non-vested stock options is expected to be recognized over a weighted-average period of approximately 1 year.

Performance-Based and Restricted Stock Awards

During the three months endedMarch 31, 2018, the company granted restricted stock units to employees of 269,433 shares. There were no performance-based stock awards granted to employees during the three months endedMarch 31, 2018 as restricted stock units were granted in place of performance-based stock awards. Compensation expense related to the restricted stock units is recognized over the vesting period, which is up to three years, based on the grant date fair value.

As of March 31, 2018 the company had performance-based stock awards outstanding, tied to either return on capital ("ROC") performance or relative total shareholder return ("TSR") performance versus that of the S&P 500. The actual number of shares issued in settlement of a vested award can range from zero to 200 percent of the target number of shares granted based upon the company’s attainment of specified performance targets at the end of a three-year period. Compensation expense related to these awards is recognized over the three-year performance period based on the fair value of the closing market price of the

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company’s common stock on the date of the grant and the estimated performance that will be achieved. Compensation expense for ROC awards will be adjusted during the three-year performance period based upon the estimated performance levels that will be achieved. TSR awards are measured at their grant date fair value and not subsequently re-measured.

The weighted-average fair value of restricted stock units granted during the three months endedMarch 31, 2018 was $144.79 ($109.64 for the same period in 2017). These fair values are based on the closing market price of Praxair’s common stock on the grant date adjusted for dividends that will not be paid during the vesting period. The weighted-average fair value of ROC performance-based stock awards granted during the three months ended March 31, 2017 was 109.68.

The weighted-average fair value of performance-based stock tied to relative TSR performance granted during three months ended March 31, 2017 was $124.12 and was estimated using a Monte Carlo simulation performed as of the grant date.

The following table summarizes non-vested performance-based and restricted stock award activity as of March 31, 2018 and changes during the three months then ended (shares based on target amounts, averages are calculated on a weighted basis):

	Performance-Based				Restricted Stock
	Number  of Shares (000’s)		Average Grant  Date Fair Value		Number  of Shares (000’s)		Average Grant  Date Fair Value
Non-vested at January 1, 2018	665		$	113.40	264		$	107.56
Granted	—		—		269		144.79
Vested	(78	)	120.04		(65	)	119.87
Cancelled and Forfeited	(147	)	111.63		(1	)	116.19
Non-vested at March 31, 2018	440		$	110.02	467		$	127.32

There are approximately 6 thousand performance-based shares and 3 thousand restricted stock shares that are non-vested at March 31, 2018 which will be settled in cash due to foreign regulatory limitations. The liability related to these grants reflects the current estimate of performance that will be achieved and the current common stock price.

As of March 31, 2018, based on current estimates of future performance, $13 million of unrecognized compensation cost related to performance-based awards is expected to be recognized through the first quarter of 2020 and $43 million of unrecognized compensation cost related to the restricted stock awards is expected to be recognized primarily through the first quarter of 2021.

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11. Retirement Programs

The components of net pension and postretirement benefits other than pensions (“OPEB”) costs for the quarters ended March 31, 2018 and 2017 are shown below:

	Quarter Ended March 31,
	Pensions						OPEB
(Millions of dollars)	2018			2017			2018			2017
Amount recognized in Operating Profit
Service cost	$	12		$	11		$	—		$	1
Amount recognized in Net pension and OPEB cost (benefit), excluding service cost
Interest cost	26			26			1			1
Expected return on plan assets	(42		)	(40		)	—			—
Net amortization and deferral	18			17			(1		)	(1		)
Curtailment gain (a)	—			—			—			(18		)
	$	2		$	3		$	—		$	(18	)
Net periodic benefit cost (benefit)	$	14		$	14		$	—		$	(17	)

(a) The curtailment gain recorded in the first quarter of 2017 resulted from the termination of an OPEB plan in South America.

Praxair estimates that 2018 required contributions to its pension plans will be in the range of $15 million to $20 million, of which $4 million have been made through March 31, 2018.

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12. Commitments and Contingencies

Contingent Liabilities

Praxair is subject to various lawsuits and government investigations that arise from time to time in the ordinary course of business. These actions are based upon alleged environmental, tax, antitrust and personal injury claims, among others. Praxair has strong defenses in these cases and intends to defend itself vigorously. It is possible that the company may incur losses in connection with some of these actions in excess of accrued liabilities. Management does not anticipate that in the aggregate such losses would have a material adverse effect on the company’s consolidated financial position or liquidity; however, it is possible that the final outcomes could have a significant impact on the company’s reported results of operations in any given period (see Note 17 to the consolidated financial statements of Praxair’s 2017 Annual Report on Form 10-K).

Significant matters are:

• During May 2009, the Brazilian government published Law 11941/2009 instituting a new voluntary amnesty program (“Refis Program”) which allowed Brazilian companies to settle certain federal tax disputes at reduced amounts. During the 2009 third quarter, Praxair decided that it was economically beneficial to settle many of its outstanding federal tax disputes and such disputes were enrolled in the Refis Program, subject to final calculation and review by the Brazilian federal government. The Company recorded estimated liabilities based on the terms of the Refis Program. Since 2009, Praxair has been unable to reach final agreement on the calculations and initiated litigation against the government in an attempt to resolve certain items. Open issues relate to the following matters: (i) application of cash deposits and net operating loss carryforwards to satisfy obligations, and (ii) the amount of tax reductions available under the Refis Program. It is difficult to estimate the timing of resolution of legal matters in Brazil.

• At March 31, 2018 the most significant non-income and income tax claims in Brazil, after enrollment in the Refis Program, relate to state VAT tax matters and a federal income tax matter where the taxing authorities are challenging the tax rate that should be applied to income generated by a subsidiary company. The total estimated exposure relating to such claims, including interest and penalties, as appropriate, is approximately $240 million. Praxair has not recorded any liabilities related to such claims based on management judgments, after considering judgments and opinions of outside counsel. Because litigation in Brazil historically takes many years to resolve, it is very difficult to estimate the timing of resolution of these matters; however, it is possible that certain of these matters may be resolved within the near term. The company is vigorously defending against the proceedings.

• On September 1, 2010, CADE (Brazilian Administrative Council for Economic Defense) announced alleged anticompetitive activity on the part of five industrial gas companies in Brazil and imposed fines on all five companies. Originally, CADE imposed a civil fine of R$2.2 billion Brazilian reais (US$662 million) against White Martins, the Brazil-based subsidiary of Praxair, Inc. In response to a motion for clarification, the fine was reduced to R$1.7 billion Brazilian reais (US$511 million) due to a calculation error made by CADE. The amount of the fine is subject to indexation using SELIC. On September 2, 2010, Praxair issued a press release and filed a report on Form 8-K rejecting all claims and stating that the fine represents a gross and arbitrary disregard of Brazilian law.

On October 19, 2010, White Martins filed an annulment petition (“appeal”) with the Federal Court in Brasilia seeking to have the fine against White Martins entirely overturned. In order to suspend payment of the fine pending the completion of the appeal process, Brazilian law required that the company tender a form of guarantee in the amount of the fine as security. Initially, 50% of the guarantee was satisfied by letters of credit with a financial institution and 50% by equity of a Brazilian subsidiary. On April 15, 2016, the Ninth Federal Court in Brasilia allowed White Martins to withdraw and cancel the letters of credit. Accordingly, the guarantee is currently satisfied solely by equity of a Brazilian subsidiary.

On September 14, 2015, the Ninth Federal Court of Brasilia overturned the fine against White Martins and declared the original CADE administrative proceeding to be null and void. On June 30, 2016, CADE filed an appeal against this decision with the Federal Circuit Court in Brasilia.

Praxair strongly believes that the allegations are without merit and that the fine will be entirely overturned during the appeal process. The company further believes that it has strong defenses and will vigorously defend against the allegations and related fine up to such levels of the Federal Courts in Brazil as may be necessary. Because appeals in Brazil historically take many years to resolve, it is very difficult to estimate when the appeal will be finally decided. Based on management judgments, after considering judgments and opinions of outside counsel, no reserve has been recorded for this proceeding as management does not believe that a loss is probable.

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13. Segments

For a description of Praxair’s operating segments, refer to Note 18 to the consolidated financial statements of Praxair’s 2017 Annual Report on Form 10-K.

Sales and operating profit by segment for the quarters ended March 31, 2018 and 2017 are shown below. 2017 segment operating profit has been reclassified to conform with current year presentation as a result of the adoption of new accounting guidance on the presentation of net periodic pension and postretirement benefit costs (see Note 1).

	Quarter Ended March 31,
(Millions of dollars)	2018		2017
SALES(a)
North America	$	1,563	$	1,458
Europe	428		356
South America	365		369
Asia	476		395
Surface Technologies	167		150
Total sales	$	2,999	$	2,728

	Quarter Ended March 31,
(Millions of dollars)	2018			2017
OPERATING PROFIT
North America	$	406		$	357
Europe	80			67
South America	54			48
Asia	104			75
Surface Technologies	28			26
Segment operating profit	672			573
Transaction costs and other charges (Note 2)	(19		)	(6		)
Total operating profit	$	653		$	567

(a) Sales reflect external sales only. Intersegment sales, primarily from North America to other segments, were not material.

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14. Equity and Redeemable Noncontrolling Interests

Equity

A summary of the changes in total equity for the quarters ended March 31, 2018 and 2017 is provided below:

	Quarter Ended March 31,
(Millions of dollars)	2018									2017
Activity	Praxair, Inc. Shareholders’ Equity			Noncontrolling Interests			Total Equity			Praxair, Inc. Shareholders’ Equity			Noncontrolling Interests			Total Equity
Balance, beginning of period	$	6,018		$	493		$	6,511		$	5,021		$	420		$	5,441
Net income (a)	462			9			471			389			15			404
Other comprehensive income (loss)	118			11			129			315			5			320
Noncontrolling interests:
Additions (reductions)	—			6			6			—			—			—
Dividends and other capital changes	—			(3		)	(3		)	—			(4		)	(4		)
Redemption value adjustments	(2		)	—			(2		)	—			—			—
Dividends to Praxair, Inc. common stock holders ($0.825 per share in 2018 and $0.7875 per share in 2017)	(237		)	—			(237		)	(225		)	—			(225		)
Issuances of common stock:
For the dividend reinvestment and stock purchase plan	2			—			2			2			—			2
For employee savings and incentive plans	3			—			3			15			—			15
Purchases of common stock	—			—			—			—			—			—
Share-based compensation	4			—			4			12			—			12
Balance, end of period	$	6,368		$	516		$	6,884		$	5,529		$	436		$	5,965

(a) Net income for noncontrolling interests excludes Net income related to redeemable noncontrolling interests of $1 million for three months ended March 31,2018 (net income was insignificant for the same time period in 2017) which is not part of total equity (see redeemable noncontrolling interests section below).

The components of AOCI are as follows:

	March 31,			December 31,
(Millions of dollars)	2018			2017
Cumulative translation adjustment - net of taxes:
North America	$	(853	)	$	(885	)
South America	(2,011		)	(2,004		)
Europe	(384		)	(398		)
Asia	(95		)	(151		)
Surface Technologies	(8		)	(17		)
	(3,351		)	(3,455		)
Derivatives - net of taxes	(1		)	(1		)
Pension / OPEB funded status obligation (net of $343 million and $347 million tax benefit in March 31, 2018 and December 31, 2017, respectively)	(628		)	(642		)
	$	(3,980	)	$	(4,098	)

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Redeemable Noncontrolling Interests

Noncontrolling interests with redemption features, such as put/sell options, that are not solely within the Company’s control (“redeemable noncontrolling interests”) are reported separately in the consolidated balance sheets at the greater of carrying value or redemption value. For redeemable noncontrolling interests that are not yet exercisable, Praxair calculates the redemption value by accreting the carrying value to the redemption value over the period until exercisable. If the redemption value is greater than the carrying value, any increase is adjusted directly to equity and does not impact net income.

At March 31, 2018 and 2017, redeemable noncontrolling interests includes one packaged gas distributor in the United States where the noncontrolling shareholder has a put option.

Following is a summary of the changes in redeemable noncontrolling interests for the three months ended March 31, 2018 and 2017:

(Millions of dollars)	2018			2017
Balance, January 1	$	11		$	11
Net income	1			—
Distributions to noncontrolling interest and other	(1		)	(1		)
Redemption value adjustments/accretion	2			—
Balance, March 31	$	13		$	10

15. Revenue Recognition

Effective January 1, 2018, Praxair adopted the FASB's Accounting Standards Update No. 2014-09 ("ASC 606") relating to Revenue Recognition using the modified retrospective transition method. The new accounting standard requires revenue to be recognized as control of goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled to receive in exchange for the goods or services. No material differences in revenue recognition were identified as compared to the Company's historical revenue recognition accounting; accordingly, there is no adjustment to opening retained earnings at January 1, 2018 and therefore no need to present comparable revenue in accordance with the prior accounting policy. The following sections include updated accounting policies and disclosures required by ASC 606. Praxair's significant accounting policies for periods through December 31, 2017 are summarized in Note 1 to its 2017 Annual Report on Form 10-K.

Contracts with Customers

Approximately 94% of Praxair’s consolidated sales are generated from industrial gases and related products in four geographic segments (North America, Europe, South America and Asia) and the remaining 6% is related to the global surface technologies segment. Praxair serves a diverse group of industries including healthcare, petroleum refining, manufacturing, food, beverage carbonation, fiber-optics, steel making, aerospace, chemicals and water treatment.

Industrial Gases

Within each of the Company’s geographic segments for industrial gases, there are three basic distribution methods: (i) on-site or tonnage; (ii) merchant or bulk liquid; and (iii) packaged or cylinder gases. The distribution method used by Praxair to supply a customer is determined by many factors, including the customer’s volume requirements and location. The distribution method generally determines the contract terms with the customer and, accordingly, the revenue recognition accounting practices. Praxair’s primary products in its industrial gases business are atmospheric gases (oxygen, nitrogen, argon, rare gases) and process gases (carbon dioxide, helium, hydrogen, electronic gases, specialty gases, acetylene). These products are generally sold through one of the three distribution methods.

Following is a description of each of the three industrial gases distribution methods and the respective revenue recognition policies:

On-site. Customers that require the largest volumes of product and that have a relatively constant demand pattern are supplied by cryogenic and process gas on-site plants. Praxair constructs plants on or adjacent to these customers’ sites and supplies the product directly to customers by pipeline. Where there are large concentrations of customers, a single pipeline may be connected to several plants and customers. On-site product supply contracts generally are total requirement contracts with terms typically ranging from 10-20 years and contain minimum purchase requirements and price escalation provisions. Many of the cryogenic on-site plants also produce liquid products for the merchant market. Therefore, plants are typically not dedicated to a single customer. Additionally, Praxair is responsible for the design, construction, operations and maintenance of the plants and our customers typically have no involvement in these activities. Advanced air separation processes also allow on-site delivery to customers with smaller volume requirements.

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The Company’s performance obligations related to on-site customers are satisfied over time as customers receive and obtain control of the product. Praxair has elected to apply the practical expedient for measuring progress towards the completion of a performance obligation and recognizes revenue as the company has the right to invoice each customer, which generally corresponds with product delivery. Accordingly, revenue is recognized when product is delivered to the customer and the Company has the right to invoice the customer in accordance with the contract terms. Consideration in these contracts is generally based on pricing which fluctuates with various price indices. Variable components of consideration exist within on-site contracts but are considered constrained.

Merchant. Merchant deliveries generally are made from Praxair’s plants by tanker trucks to storage containers at the customer's site. Due to the relatively high distribution cost, merchant oxygen and nitrogen generally have a relatively small distribution radius from the plants at which they are produced. Merchant argon, hydrogen and helium can be shipped much longer distances. The customer agreements used in the merchant business are usually three-to seven-year supply agreements based on the requirements of the customer. These contracts generally do not contain minimum purchase requirements or volume commitments.

The Company’s performance obligations related to merchant customers are generally satisfied at a point in time as the customers receive and obtain control of the product. Revenue is recognized when product is delivered to the customer and the Company has the right to invoice the customer in accordance with the contract terms. Any variable components of consideration within merchant contracts are constrained however this consideration is not significant.

Packaged Gases. Customers requiring small volumes are supplied products in containers called cylinders, under medium to high pressure. Praxair distributes merchant gases from its production plants to Company-owned cylinder filling plants where cylinders are then filled for distribution to customers. Cylinders may be delivered to the customer’s site or picked up by the customer at a packaging facility or retail store. Praxair invoices the customer for the industrial gases and the use of the cylinder container(s). The Company also sells hardgoods and welding equipment purchased from independent manufacturers. Packaged gases are generally sold under one to three-year supply contracts and purchase orders and do not contain minimum purchase requirements or volume commitments.

The Company’s performance obligations related to packaged gases are satisfied at a point in time. Accordingly, revenue is recognized when product is delivered to the customer or when the customer picks up product from a packaged gas facility or retail store, and the Company has the right to payment from the customer in accordance with the contract terms. Any variable consideration is constrained and will be recognized when the uncertainty related to the consideration is resolved.

Surface Technologies

The company’s surface technologies segment, operated through Praxair Surface Technologies, Inc., supplies wear-resistant and high-temperature corrosion-resistant metallic and ceramic coatings and powders. Praxair Surface Technologies is a leading global supplier of coatings services and thermal spray consumables to customers in the aircraft, energy, printing, primary metals, petrochemical, textile, and other industries. Its coatings are used to provide wear resistance, corrosion protection, thermal insulation, and many other surface-enhancing functions which serve to extend component life, enable optimal performance, and reduce operating costs. It also manufactures a complete line of electric arc, plasma and wire spray, and high-velocity oxy-fuel ("HVOF") equipment.

The Company’s performance obligation related to surface technologies customers are generally satisfied at a point in time when the customer receives and takes control of product. Accordingly, revenue is recognized when product is delivered to the customer or when the customer picks up the product from the Company’s facility, and the Company has the right to invoice the customer in accordance with the contract terms.

Payment Terms and Other

Praxair generally receives payment after performance obligations are satisfied, and customer prepayments are not typical. Payment terms vary based on the country where sales originate and local customary payment practices. Praxair does not offer extended financing outside of customary payment terms. Contract asset and liability balances and the changes in these balances are not material. Amounts billed for sales and use taxes, value-added taxes, and certain excise and other specific transactional taxes imposed on revenue producing transactions are presented on a net basis and are not included in sales within the consolidated statement of income. Additionally, sales returns and allowances are not a normal practice in the industry and are not significant.

Disaggregated Revenues Information

As described above and in Note 18 of the 2017 10-K, the Company manages its industrial gases business on a geographic basis, while the surface technologies business is managed on a global basis. Further, the Company believes that reporting sales by distribution method by reportable geographic segment best illustrates the nature, timing, type of customer, and contract terms for its revenues, including terms and pricing.

23

The following table shows sales by distribution method for each reportable segment and at the consolidated level for the quarter ended March 31, 2018.

(Dollars in Millions)			Industrial Gases
Sales	North America			Europe		South America		Asia		Surface Technologies		Total		%
Merchant	$	573		$	148	$	143	$	147	$	—	$	1,011	34	%
On-Site	460			80		114		246		—		900		30	%
Packaged Gas	493			181		98		54		—		826		27	%
Other	37			19		10		29		167		262		9	%
	$	1,563		$	428	$	365	$	476	$	167	$	2,999	100	%

Remaining Performance Obligations

As described above, Praxair’s contracts with on-site customers are under long-term supply arrangements which generally require the customer to purchase their requirements from Praxair and also have minimum purchase requirements. The Company estimates the consideration related to minimum purchase requirements is approximately $17 billion. This amount excludes all sales above minimum purchase requirements, which can be significant depending on customer needs. In the future, actual amounts will be different due to impacts from several factors, many of which are beyond the Company’s control including, but not limited to, timing of newly signed, terminated and renewed contracts, inflationary price escalations, currency exchange rates, and pass-through costs related to natural gas and electricity. The actual duration of long-term supply contracts ranges up to twenty years. The Company estimates that approximately half of the revenue related to minimum purchase requirements are estimated to be earned in the next five years and the remaining thereafter.

Note 16. Income Taxes

U.S. Tax Cuts and Jobs Act (Tax Act)

On December 22, 2017 the U.S. government enacted the Tax Cuts and Jobs Act (Tax Act). This comprehensive tax legislation significantly revises the U.S. corporate income tax rules by, among other things, lowering the corporate income tax rate from 35% to 21%, implementing a territorial tax system and imposing a one-time tax on accumulated earnings of foreign subsidiaries. Given the substantial uncertainties surrounding the Tax Act and the short period of time between December 22, 2017 and December 31, 2017 to calculate the U.S. Federal, U.S. state, and non-U.S. tax impacts of the Tax Act, the Company is accounting for its income tax charge on a provisional (estimated) basis as allowed by SEC Staff Accounting Bulletin No. 118. In 2017, the Company recorded a net provisional income tax charge of $394 million with three main components: (i) an estimated $467 million U.S. federal and state tax charge for deemed repatriation of accumulated foreign earnings; (ii) an estimated $260 million charge for foreign withholding taxes related to anticipated future repatriation of foreign earnings; and (iii) an estimated $333 million deferred tax benefit for the revaluation of net deferred tax liabilities from 35% to the new 21% tax rate. Refer to Note 5 to the consolidated financial statements of Praxair's 2017 Annual Report on Form 10-K.

During 2018, the Company will continue to evaluate the Tax Act, additional guidance from the Internal Revenue Service, its historical foreign earnings and taxes and other items that could impact its net provisional tax charge. Additionally, the Company will continue to review its foreign capital structures, organizational cash needs and the foreign withholding tax cost of planned repatriation. As new information becomes available, the Company will update its provisional estimate and record any changes to its income tax expense at that time. As of March 31, 2018, there have been no adjustments to the net provisional income tax charge recognized in 2017.

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17. Proposed Business Combination with Linde AG

On June 1, 2017, Praxair, Inc. and Linde AG entered into a definitive Business Combination Agreement, as amended (the "Business Combination Agreement"), pursuant to which, among other things, Praxair, Inc. and Linde AG agreed to combine their respective businesses through an all-stock transaction, and become subsidiaries of a new holding company incorporated in Ireland, Linde plc. In connection with the proposed business combination, Linde plc filed a Registration Statement on Form S-4 which was declared effective by the U. S. Securities and Exchange Commission ("SEC") on August 14, 2017.

Linde plc has also filed an offer document with the German Federal Financial Supervisory Authority (Bundesanstalt fuer Finanzdienstleistungsaufsicht) (“BaFin”) which was approved for publication by BaFin on August 14, 2017 and published by Linde plc on August 15, 2017. Pursuant to the offer document, Linde plc made an offer to exchange each issued and outstanding no-par value bearer share of Linde AG for 1.540 ordinary shares of Linde plc (the “Exchange Offer”). In addition, Zamalight Subco, Inc., an indirect wholly-owned Delaware subsidiary of Linde plc, will merge with and into Praxair, Inc., with Praxair, Inc. surviving the merger (the “Merger”, and together with the Exchange Offer, the “Business Combination”). In the Merger, each share of Praxair, Inc. common stock will be converted into the right to receive one Linde plc ordinary share. Praxair Inc.’s stockholders approved the Merger at Praxair Inc.’s special meeting held on September 27, 2017, and on November 24, 2017, the tender period for the Exchange Offer expired with approximately 92% of all Linde AG shares entitled to voting rights being tendered. The parties currently expect the Business Combination to be completed in the second half of 2018. Upon completion of the business combination, Linde plc will apply to list its ordinary shares on the New York Stock Exchange and the Frankfurt Stock Exchange, and will seek inclusion in the S&P 500 and DAX 30 indices.

Completion of the Business Combination remains subject to approval by requisite governmental regulators and authorities, including approvals under applicable competition laws.

The Business Combination Agreement, or certain covenants contained therein, may be terminated for, or may terminate as a result of, certain reasons, including, among others, (a) the mutual consent of Praxair, Inc. and Linde AG to termination, (b) a permanent injunction or order by any governmental entity in Ireland, the United Kingdom, Germany or the United States that prohibits or makes illegal the completion of the Business Combination, (c) the occurrence of a change, event, occurrence or effect that has had or is reasonably expected to have a “material adverse change” (as defined in the Business Combination Agreement) on Linde AG or Praxair, Inc. or (d) the failure to obtain approval by requisite governmental regulators and authorities described in the preceding paragraph.

For additional information related to the Business Combination Agreement, please refer to the proxy statement/prospectus filed by Praxair, Inc. on Schedule 14A with the SEC on August 16, 2017.

25

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following table provides summary data for the quarter ended March 31, 2018 and 2017:

	Quarter Ended March 31,
(Dollar amounts in millions, except per share data)	2018			2017 (c)			Variance
Reported Amounts
Sales	$	2,999		$	2,728		10	%
Cost of sales, exclusive of depreciation and amortization	$	1,677		$	1,549		8	%
Gross margin (a)	$	1,322		$	1,179		12	%
As a percent of sales	44.1		%	43.2		%
Selling, general and administrative	$	310		$	290		7	%
As a percent of sales	10.3		%	10.6		%
Depreciation and amortization	$	311		$	287		8	%
Transaction costs and other charges (b)	$	19		$	6
Other income (expense) - net	$	(5	)	$	(6	)
Operating profit	$	653		$	567		15	%
Operating margin	21.8		%	20.8		%
Interest expense - net	$	46		$	41		12	%
Net pension and OPEB cost (benefit), excluding service cost	$	2		$	(15	)
Effective tax rate	24.5		%	27.5		%
Income from equity investments	$	15		$	12		25	%
Noncontrolling interests	$	(10	)	$	(15	)	(33	)%
Net income - Praxair, Inc.	$	462		$	389		19	%
Diluted earnings per share	$	1.59		$	1.35		18	%
Diluted shares outstanding	290,809			287,384			1	%
Number of employees	26,550			26,420
Adjusted Amounts (b)
Operating profit	$	672		$	573		17	%
Operating margin	22.4		%	21.0		%
Effective tax rate	24.0		%	27.2		%
Noncontrolling interests	$	(9	)	$	(15	)	(40	)%
Net income - Praxair, Inc.	$	480		$	395		22	%
Diluted earnings per share	$	1.65		$	1.37		20	%
Other Financial Data (b)
EBITDA	$	979		$	866
EBITDA Margin	32.6		%	31.7		%
Adjusted EBITDA	$	998		$	872
Adjusted EBITDA Margin	33.3		%	32.0		%

(a) Gross margin excludes depreciation and amortization expense.

(b) Adjusted amounts and other financial data are non-GAAP performance measures. A reconciliation of reported amounts to adjusted amounts and other financial data can be found in the "Non-GAAP Financial Measures" section of this MD&A. See Note 2 to the condensed consolidated financial statements.

(c) Prior period information has been reclassified to conform with current year presentation as a result of the adoption of new accounting guidance on the presentation of net periodic pension and postretirement benefit costs. See Note 1 to the condensed consolidation financial statements.

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Consolidated Results

In the first quarter of 2018, Praxair’s sales were $2,999 million, 10% above the prior–year quarter. Excluding favorable currency translation sales growth of 7% was driven by higher volumes across all segments, including new project start-ups, and price attainment. Reported operating profit for the first quarter of 2018 of $653 million, 21.8% of sales, was 15% above $567 million in the prior-year quarter. Operating profit included transaction and other costs of $19 million primarily related to the potential Linde merger. Excluding these costs, adjusted operating profit was $672 million, 22.4% of sales and 17% above the 2017 adjusted first quarter driven by higher volumes and price. The company's EBITDA margin was 32.6% and adjusted EBITDA margin was 33.3%. The reported effective tax rate ("ETR") was 24.5% versus 27.5% in the first quarter of 2017. The adjusted ETR was 24.0% versus 27.2% in the first quarter of 2017, reflecting the impact of U.S. tax reform. Diluted earnings per share ("EPS") was $1.59, 18% above reported EPS of $1.35 in the first quarter of 2017. On an adjusted basis, EPS was $1.65, 20% above the 2017 EPS of $1.37, driven by higher adjusted net income and a lower adjusted ETR.

Outlook

Diluted EPS for the second quarter of 2018 is expected to be in the range of $1.67 to $1.72 excluding transaction costs related to the potential Linde merger. The effective tax rate is estimated to be in the range of 23% to 25%.

The company’s core business is to build, own, and operate industrial gas plants in order to supply atmospheric and process gases to customers. As such, Praxair believes that its backlog is one indicator of future sales growth. At March 31, 2018, Praxair’s backlog of 16 large projects under construction was $1.5 billion. This represents the total estimated capital cost of large plants under construction. These plants will supply customers in the energy, chemical, manufacturing, and electronics end-markets.

Praxair provides quarterly updates on operating results, material trends that may affect financial performance, and financial earnings guidance via quarterly earnings releases and investor teleconferences. These updates are available on the company’s website, www.praxair.com, but are not incorporated herein.

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Results of Operations

The changes in consolidated sales and operating profit compared to the prior year are attributable to the following:

	Quarter Ended March 31, 2018 vs. 2017
	% Change
	Sales		Operating Profit
Factors Contributing to Changes
Volume	5	%	10	%
Price/Mix	2	%	8	%
Cost pass-through	—	%	—	%
Currency	3	%	3	%
Acquisitions/divestitures	—	%	—	%
Other	—	%	(6	)%
Reported	10	%	15	%
Add: Transaction costs and other charges	—	%	2	%
Adjusted	10	%	17	%

The following tables provide sales by end-market and distribution method:

	Quarter Ended March 31,
	% of Sales				% Change*
	2018		2017
Sales by End Markets
Manufacturing	23	%	23	%	6	%
Metals	17	%	17	%	9	%
Energy	11	%	12	%	1	%
Chemicals	11	%	10	%	14	%
Electronics	9	%	9	%	10	%
Healthcare	8	%	8	%	6	%
Food & Beverage	9	%	9	%	6	%
Aerospace	3	%	3	%	8	%
Other	9	%	9	%	—	%
	100	%	100	%

 * Excludes impact of currency, natural gas/precious metals cost pass-through and acquisitions/divestitures.

	Quarter Ended March 31,
	% of Sales
	2018		2017
Sales by Distribution Method
On-Site	30	%	30	%
Merchant	34	%	34	%
Packaged Gas	27	%	27	%
Other	9	%	9	%
	100	%	100	%

Sales increased $271 million, or 10%, for the first quarter versus the respective 2017 period. Favorable currency translation, primarily in Europe, increased sales by 3%. Volume growth contributed 5% to sales driven by higher volumes in North America and Asia, including new project start-ups. Higher overall pricing across all segments contributed 2% to sales.

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Gross margin increased $143 million, or 12%, for the first quarter of 2018 versus the respective 2017 period, primarily due to higher volumes and price. Gross margin as a percentage of sales increased to 44.1% from 43.2% for the first quarter of 2018 versus the respective 2017 period.

Selling, general and administrative expense ("SG&A") increased $20 million, or 7%, for the first quarter of 2018 versus the respective 2017 period. Currency impacts increased SG&A $9 million for the quarter. Excluding currency effects, SG&A was higher driven by cost inflation partially offset by cost reduction actions.

Depreciation and amortization expense increased $24 million, or 8%, for the first quarter of 2018 versus the respective 2017 period. Currency impacts increased depreciation and amortization by $10 million. Excluding currency effects, depreciation and amortization expense increased $14 million primarily driven by large project start-ups.

Praxair recorded transaction costs and other charges of $19 million and $6 million in the first quarters of 2018 and 2017, respectively, primarily related to the potential merger (refer to Note 2 to the condensed consolidated financial statements).

Other income (expense) – net was $5 million expense for the 2018 first quarter compared to $6 million expense for the 2017 first quarter. In Asia, the first quarter of 2018 included a $22 million asset impairment charge, offset by a litigation settlement gain.

Reported operating profit increased$86 million, or 15%, for the first quarter of 2018 versus the respective 2017 period. The first quarters of 2018 and 2017 include $19 million and $6 million, respectively, of transaction costs and other charges primarily related to the potential merger. Excluding these charges, adjusted operating profit increased $99 million, or 17%, for the first quarter of 2018 versus the respective 2017 period driven by higher volumes and price.

Interest expense-net increased$5 million, or 12%, for the first quarter of 2018 versus the respective 2017 periods. This increase was primarily attributable to lower capitalized interest.

The reported effective tax rate ("ETR") for the first quarter of 2018 and 2017 was 24.5% and 27.5%, respectively. The reported ETR for the first quarter of 2018 includes transaction costs and other charge of $19 million ($17 million after-tax) related to the potential merger. The reported ETR for the 2017 quarter includes $6 million of non-deductible transaction costs related to the potential merger. Excluding these impacts, on an adjusted basis the ETR for the first quarters of 2018 and 2017 was 24.0% and 27.2%, respectively. The decrease was driven primarily by the impact of the U.S. Tax Cuts and Jobs act enacted in the fourth quarter of 2017 (see Note 16 to the condensed consolidated financial statements).

Income from equity investments for the first quarter of 2018 and 2017 was $15 million and $12 million, respectively, largely in China and Italy.

At March 31, 2018, non-controlling interests consisted primarily of non-controlling shareholders' investments in Asia (primarily China), Europe (primarily Italy) and surface technologies. Reported non-controlling interests decreased $5 million for the first quarter of 2018 versus the respective 2017 period as higher earnings were more than offset by the impact of an asset impairment charge.

Reported Net income-Praxair, Inc. increased$73 million, or 19%, for the first quarter of 2018 versus the respective 2017 period. Included within the first quarter of 2018 were transaction costs and other charges of $18 million after-tax and noncontrolling interests. Included within the first quarter 2017 were transaction costs and other charges of $6 million after-tax (see Note 2 to the condensed consolidated financial statements). Excluding these charges, adjusted Net income-Praxair, Inc increased $85 million, or 22%, for the first quarter of 2018 due to higher adjusted operating profit and a lower effective tax rate.

Reported Earnings per share of $1.59increased$0.24, or 18%, for the first quarter of 2018 versus the respective 2017 period. Included within the 2018 and 2017 first quarters were charges of $0.06 and $0.02, respectively, for transaction costs and other charges related primarily to the potential merger (see Note 2 to the condensed consolidated financial statements). Excluding these charges, adjusted EPS increased $0.28, or 20% for the first quarter of 2018 versus prior year primarily due to higher adjusted net income.

The number of employees at March 31, 2018 was 26,550, an increase of 130 employees from March 31, 2017.

29

Other Financial Data

EBITDA increased $113 million to $979 million for the first quarter 2018 from $866 million for the first quarter 2017. Adjusted EBITDA increased $126 million to $998 million for the first quarter 2018 from $872 million for the first quarter 2017. The increase in EBITDA and adjusted EBITDA in the quarter is primarily due to higher net income plus depreciation and amortization on both a reported and adjusted basis versus the prior year periods.

See the "Non-GAAP Financial Measures" section below for definitions and reconciliations of these non-GAAP measures to reported GAAP amounts.

Other Comprehensive Income (Loss)

Other comprehensive income for the three months ended March 31, 2018 of $129 million resulted primarily from currency translation adjustments. The translation adjustments reflect the impact of translating local currency foreign subsidiary financial statements to U.S. dollars. Generally, positive translation adjustments result from the weakening of the U.S. dollar against most major currencies, while negative translation adjustments result from a strengthening of the U.S. dollar. See the "Currency" section of the MD&A for exchange rates used for translation purposes and Note 14 to the condensed consolidated financial statements for a summary of the currency translation adjustment component of accumulated other comprehensive income by segment.

Retirement Benefits

The net periodic benefit cost for pension and OPEB plans was a $14 million cost for the quarter ended March 31, 2018 versus a $3 million benefit in the respective 2017 period. The increase in expense versus the prior year for the three months ended March 31, 2018 is related to a curtailment gain recorded in the first quarter of 2017 on a South American OPEB plan for $18 million (see Note 11 to the condensed consolidated financial statements).

Segment Discussion

The following summary of sales and operating profit by segment provides a basis for the discussion that follows.

	Quarter Ended March 31,
(Dollar amounts in millions)	2018			2017*			Variance
SALES
North America	$	1,563		$	1,458		7	%
Europe	428			356			20	%
South America	365			369			(1	)%
Asia	476			395			21	%
Surface Technologies	167			150			11	%
	$	2,999		$	2,728		10	%
OPERATING PROFIT
North America	$	406		$	357		14	%
Europe	80			67			19	%
South America	54			48			13	%
Asia	104			75			39	%
Surface Technologies	28			26			8	%
Segment operating profit	672			573			17	%
Transaction costs and other charges	(19		)	(6		)
Total operating profit	$	653		$	567		15	%

* Prior period segment operating profit has been reclassified to conform with current year presentation as a result of the adoption of new accounting guidance on the presentation of net periodic pension and postretirement benefit costs. See Note 1 to the condensed consolidation financial statements.

30

North America

	Quarter Ended March 31,
	2018			2017			Variance
Sales	$	1,563		$	1,458		7	%
Cost of sales, exclusive of depreciation and amortization	806			775
Gross margin	757			683
Operating expenses	189			172
Depreciation and amortization	162			154
Operating profit	$	406		$	357		14	%
Margin %	26.0		%	24.5		%

	Quarter Ended March 31, 2018 vs. 2017
	% Change
	Sales		Operating Profit
Factors Contributing to Changes
Volume	4	%	11	%
Price/Mix	2	%	7	%
Cost pass-through	—	%	—	%
Currency	1	%	1	%
Acquisitions/divestitures	—	%	—	%
Other	—	%	(5	)%
	7	%	14	%

The following tables provide sales by end-market and distribution method:

	Quarter Ended March 31,
	% of Sales				% Change*
	2018		2017
Sales by End Markets
Manufacturing	30	%	29	%	6	%
Metals	12	%	12	%	8	%
Energy	17	%	18	%	(2	)%
Chemicals	10	%	9	%	22	%
Electronics	5	%	5	%	20	%
Healthcare	7	%	7	%	8	%
Food & Beverage	10	%	10	%	8	%
Aerospace	2	%	2	%	9	%
Other	7	%	8	%	(5	)%
	100	%	100	%

* Excludes impact of currency, natural gas/precious metals cost pass-through and acquisitions/divestitures.

	Quarter Ended March 31,
	% of Sales
	2018		2017
Sales by Distribution Method
On- Site	29	%	30	%
Merchant	37	%	37	%
Packaged Gas	32	%	30	%
Other	2	%	3	%
	100	%	100	%

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North America segment sales increased $105 million, or 7% in the first quarter of 2018 as compared to prior year. Favorable currency translation increased sales by 1% in the quarter. Excluding currency, sales were 6% above the prior-year quarter primarily due to higher volumes to most end-markets and higher pricing.

North America segment operating profit increased $49 million, or 14% in the first quarter of 2018 as compared to the prior-year quarter driven by higher volumes and pricing.

Europe

	Quarter Ended March 31,
	2018			2017			Variance %
Sales	$	428		$	356		20	%
Cost of sales, exclusive of depreciation and amortization	248			201
Gross margin	180			155
Operating expenses	54			48
Depreciation and amortization	46			40
Operating profit	$	80		$	67		19	%
Margin %	18.7		%	18.8		%

	Quarter Ended March 31, 2018 vs. 2017
	% Change		% Change
	Sales		Operating Profit
Factors Contributing to Changes
Volume	2	%	5	%
Price/Mix	1	%	7	%
Cost pass-through	2	%	—	%
Currency	15	%	16	%
Acquisitions/divestitures	—	%	—	%
Other	—	%	(9	)%
	20	%	19	%

The following tables provide sales by end-market and distribution method:

	Quarter Ended March 31,
	% of Sales				% Change*
	2018		2017
Sales by End Markets
Manufacturing	21	%	21	%	6	%
Metals	17	%	17	%	9	%
Energy	4	%	4	%	(6	)%
Chemicals	12	%	13	%	4	%
Electronics	8	%	7	%	9	%
Healthcare	12	%	12	%	6	%
Food & Beverage	13	%	13	%	8	%
Aerospace	1	%	1	%	—
Other	12	%	12	%	(1	)%
	100	%	100	%

* Excludes impact of currency, natural gas/precious metals cost pass-through and acquisitions/divestitures

32

	Quarter Ended March 31,
	% of Sales
	2018		2017
Sales by Distribution Method
On- Site	19	%	19	%
Merchant	35	%	35	%
Packaged Gas	42	%	41	%
Other	4	%	5	%
	100	%	100	%

Europe segment sales increased by $72 million, or 20% in the first quarter of 2018 as compared to the prior year. Favorable currency translation increased sales by 15%. Cost pass-through increased sales by 2% in the quarter with minimal impact on operating profit. Excluding currency and cost pass-through, sales increased 3% in the quarter driven by higher volumes and higher price.

Europe segment operating profit increased by $13 million, or 19% in the first quarter of 2018 as compared to the prior year. Favorable currency translation increased operating profit by 16%. Excluding currency translation, operating profit increased 3% driven by higher volumes and price partially offset by cost inflation.

South America

	Quarter Ended March 31,
	2018			2017			Variance
Sales	$	365		$	369		(1	)%
Cost of sales, exclusive of depreciation and amortization	219			228
Gross margin	146			141
Operating expenses	51			54
Depreciation and amortization	41			39
Operating profit	$	54		$	48		13	%
Margin %	14.8		%	13.0		%

	Quarter Ended March 31, 2018 vs. 2017
	% Change		% Change
	Sales		Operating Profit
Factors Contributing to Changes
Volume	1	%	(2	)%
Price/Mix	1	%	10	%
Cost pass-through	—	%	—	%
Currency	(3	)%	(5	)%
Acquisitions/divestitures	—	%	—	%
Other	—	%	10	%
	(1	)%	13	%

33

The following tables provide sales by end-market and distribution method:

	Quarter Ended March 31,
	% of Sales				% Change*
	2018		2017
Sales by End Markets
Manufacturing	17	%	18	%	(1	)%
Metals	31	%	29	%	4	%
Energy	2	%	2	%	(4	)%
Chemicals	9	%	10	%	—	%
Electronics	—	%	—	%	—	%
Healthcare	18	%	19	%	3	%
Food & Beverage	13	%	14	%	1	%
Aerospace	—	%	—	%	—	%
Other	10	%	8	%	11	%
	100	%	100	%

* - Excludes impact of currency, natural gas/precious metals cost pass-through and acquisitions/divestitures.

	Quarter Ended March 31,
	% of Sales
	2018		2017
Sales by Distribution Method
On- Site	31	%	31	%
Merchant	39	%	39	%
Packaged Gas	27	%	28	%
Other	3	%	2	%
	100	%	100	%

South America segment sales decreased$4 million, or 1% in the first quarter of 2018 as compared to the prior year. Unfavorable currency impacts decreased sales by 3% in the quarter driven by the weakening of the Brazilian real and Argentine peso against the U.S. dollar. Excluding currency in the quarter, sales increased 2% driven by higher price and higher volumes largely to the metals and healthcare end-markets.

South America segment operating profit increased $6 million, or 13% in the first quarter of 2018 versus the prior year as higher price and lower costs were only partially offset by unfavorable product sales mix.

Asia

	Quarter Ended March 31,
	2018			2017			Variance
Sales	$	476		$	395		21	%
Cost of sales, exclusive of depreciation and amortization	294			249
Gross margin	182			146
Operating expenses	26			27
Depreciation and amortization	52			44
Operating profit	$	104		$	75		39	%
Margin %	21.8		%	19.0		%

34

	Quarter Ended March 31, 2018 vs. 2017
	% Change		% Change
	Sales		Operating Profit
Factors Contributing to Changes
Volume	11	%	18	%
Price/Mix	3	%	14	%
Cost pass-through	—	%	—	%
Currency	7	%	7	%
Acquisitions/divestitures	—	%	—	%
Other	—	%	—	%
	21	%	39	%

The following tables provide sales by end-market and distribution method:

	Quarter Ended March 31,
	% of Sales				% Change*
	2018		2017
Sales by End Markets
Manufacturing	9	%	8	%	28	%
Metals	27	%	26	%	18	%
Energy	5	%	3	%	95	%
Chemicals	15	%	15	%	11	%
Electronics	33	%	35	%	6	%
Healthcare	1	%	1	%	(4	)%
Food & Beverage	2	%	2	%	(10	)%
Aerospace	—	%	—	%	—	%
Other	8	%	10	%	5	%
	100	%	100	%

* Excludes impact of currency, natural gas/precious metals cost pass-through and acquisitions/divestitures

	Quarter Ended March 31,
	% of Sales
	2018		2017
Sales by Distribution Method
On- Site	52	%	51	%
Merchant	31	%	29	%
Packaged Gas	11	%	14	%
Other	6	%	6	%
	100	%	100	%

Asia segment sales increased$81 million, or 21% in the first quarter of 2018 as compared to the prior year. Favorable currency translation increased sales by 7% in the quarter. Volume growth of 11% in the quarter was primarily attributable to base volume growth in China, Korea and India and new project start-ups in China and Korea. Higher price increased sales by 3% in the quarter primarily driven by China. Sales growth was strongest in the metals, energy and electronics end-markets.

Asia segment operating profit increased$29 million, or 39% in the first quarter of 2018 as compared to the prior year driven by higher volumes and price. Favorable currency translation increased operating profit by 7%. Operating profit for the first quarter included a included a $22 million asset impairment charge, offset by a litigation settlement gain.

35

Surface Technologies

	Quarter Ended March 31,
	2018			2017			Variance
Sales	$	167		$	150		11	%
Cost of sales, exclusive of depreciation and amortization	110			96
Gross margin	57			54
Operating expenses	19			18
Depreciation and amortization	10			10
Operating profit	$	28		$	26		8	%
Margin %	16.8		%	17.3		%

	Quarter Ended March 31, 2018 vs. 2017
	% Change		% Change
	Sales		Operating Profit
Factors Contributing to Changes
Volume/Price	6	%	12	%
Cost pass-through	—	%	—	%
Currency	5	%	4	%
Acquisitions/divestitures	—	%	—	%
Other	—	%	(8	)%
	11	%	8	%

The following table provides sales by end-market:

	Quarter Ended March 31,
	% of Sales				% Change*
	2018		2017
Sales by End Markets
Manufacturing	12	%	11	%	11	%
Metals	8	%	8	%	1	%
Energy	19	%	19	%	3	%
Chemicals	2	%	2	%	12	%
Electronics	1	%	1	%	—	%
Healthcare	—	%	—	%	—	%
Food & Beverage	3	%	4	%	(9	)%
Aerospace	44	%	44	%	8	%
Other	11	%	11	%	5	%
	100	%	100	%

* Excludes impact of currency, natural gas/precious metals cost pass-through and acquisitions/divestitures

Surface Technologies segment sales increased $17 million, or 11% in the first quarter of 2018 as compared to the prior year. Currency translation impacts increased sales by 5% for the quarter, primarily driven by the British pound and the Euro. Excluding currency impacts, sales increased 6% in the quarter due to higher volumes to the aerospace end-market and higher price.

Surface Technologies segment operating profit increased $2 million, or 8% in the first quarter of 2018 as compared to the prior year. Excluding currency impacts, operating profit increased 4% for the quarter due to increased volumes and price, partially offset by higher costs related to project ramp up costs.

36

Currency

The results of Praxair’s non-U.S. operations are translated to the company’s reporting currency, the U.S. dollar, from the functional currencies. For most foreign operations, Praxair uses the local currency as its functional currency. There is inherent variability and unpredictability in the relationship of these functional currencies to the U.S. dollar and such currency movements may materially impact Praxair’s results of operations in any given period.

To help understand the reported results, the following is a summary of the significant currencies underlying Praxair’s consolidated results and the exchange rates used to translate the financial statements (rates of exchange expressed in units of local currency per U.S. dollar):

	Percentage of YTD 2018 Consolidated Sales		Exchange Rate for Income Statement		Exchange Rate for Balance Sheet
			Year-To-Date Average		March 31,	December 31,
Currency			2018	2017	2018	2017
Euro	14	%	0.81	0.94	0.81	0.83
Brazilian real	10	%	3.25	3.14	3.32	3.31
Canadian dollar	7	%	1.26	1.32	1.29	1.26
Chinese yuan	7	%	6.36	6.89	6.28	6.51
Mexican peso	5	%	18.71	20.26	18.18	19.66
Korean won	4	%	1,072	1,153	1,064	1,067
India rupee	3	%	64.37	67.00	65.18	63.87
Argentine peso	1	%	19.68	15.66	20.15	18.65
British pound	1	%	0.72	0.81	0.71	0.74
Norwegian krone	1	%	7.84	8.43	7.84	8.20

37

Liquidity, Capital Resources and Other Financial Data

The following selected cash flow information provides a basis for the discussion that follows:

(Millions of dollars)	Three months ended March 31,
	2018			2017
NET CASH PROVIDED BY (USED FOR):
OPERATING ACTIVITIES
Net income (including noncontrolling interests)	$	472		$	404
Non-cash charges (credits):
Add: Depreciation and amortization	311			287
Add: Deferred income taxes	11			22
Add: Share-based compensation	4			12
Add: Transaction costs and other charges, net of payments (a)	14			6
Net income adjusted for non-cash charges	812			731
Less: Working capital	(170		)	(106		)
Less: Pension contributions	(4		)	(3		)
Other	50			88
Net cash provided by operating activities	$	688		$	710
INVESTING ACTIVITIES
Capital expenditures	(325		)	(327		)
Acquisitions, net of cash acquired	—			(1		)
Divestitures and asset sales	7			4
Net cash used for investing activities	$	(318	)	$	(324	)
FINANCING ACTIVITIES
Debt increase (decrease) - net	(215		)	(173		)
Issuances (purchases) of common stock - net	29			15
Cash dividends - Praxair, Inc. shareholders	(237		)	(225		)
Noncontrolling interest transactions and other	(6		)	(13		)
Net cash provided by (used for) financing activities	$	(429	)	$	(396	)
Effect of exchange rate changes on cash and cash equivalents	$	(13	)	$	5
Cash and cash equivalents, end-of-period	$	545		$	519

(a) See Note 2 to the consolidated financial statements.

Cash Flow from Operations

Cash provided by operations of $688 million for the three months ended March 31, 2018decreased$22 million, or 3%, versus 2017. The decrease was primarily attributable to timing of tax payments and timing of dividends from equity investments, primarily in China, which more than offset the increase from net income adjusted for non-cash charges.

Praxair estimates that total 2018 required contributions to its pension plans will be in the range of $15 million to $20 million, of which $4 million has been made through March 31, 2018. At a minimum, Praxair contributes to its pension plans to comply with local regulatory requirements (e.g., ERISA in the United States). Discretionary contributions in excess of the local minimum requirements are made based on many factors, including long-term projections of the plans' funded status, the economic environment, potential risk of overfunding, pension insurance costs and alternative uses of the cash. Changes to these factors can impact the amount and timing of discretionary contributions from year to year.

38

Investing

Net cash used for investing of $318 million for the three months ended March 31, 2018 decreased $6 million versus 2017.

Capital expenditures for the three months ended March 31, 2018 were $325 million, $2 million less than the prior year. Capital expenditures related primarily to investments in new plant and production equipment for growth and density. Approximately 65% of the capital expenditures were in North America.

Acquisition spend was immaterial for both the three months ended March 31, 2018 and 2017.

Divestitures and asset sales for the three months ended March 31, 2018 and 2017 were $7 million and $4 million, respectively.

Financing

Cash used by financing activities was $429 million for the three months ended March 31, 2018. Cash dividends of $237 million were higher than the prior year due to a 5% increase in quarterly dividends per share from 78.75 cents per share to 82.5 cents per share. Net issuances of common stock increased $14 million due primarily to fewer share repurchases. Noncontrolling interest transactions and other for the three months ended March 31, 2018 and 2017 were $6 million and $13 million, respectively.

In March 2018, Praxair repaid $500 million of 1.20% rate notes that became due.

Praxair's debt-to-capital ratio was 54.6% at March 31, 2018 versus 59.7% at March 31, 2017. This decrease was primarily attributable to a reduction in net debt of $552 million and an increase in equity due to earnings net of dividends declared. See the "Non-GAAP Financial Measures" section below for definitions and reconciliations of these non-GAAP measures to reported GAAP amounts.

Debt Covenants

Praxair’s $2.5 billion senior unsecured credit facility, $500 million 364-day revolving credit facility, and long-term debt agreements contain various covenants (refer to Note 5 to the condensed consolidated financial statements and Note 11 to the consolidated financial statements of Praxair’s 2017 Annual Report on Form 10-K). The only financial covenant requires Praxair not to exceed a maximum 70% leverage ratio, as defined in the agreements. For purposes of the leverage ratio calculation, consolidated shareholders' equity excludes changes in the cumulative foreign currency translation adjustments after June 30, 2011. At March 31, 2018 and December 31, 2017, the actual leverage ratio calculated in accordance with the agreements was 48% and 49%, respectively.

Legal Proceedings

See Note 12 to the condensed consolidated financial statements.

Non-GAAP Financial Measures

The following non-GAAP measures are intended to supplement investors’ understanding of the company’s financial information by providing measures which investors, financial analysts and management use to help evaluate the company’s financial leverage and operating performance. Special items which the company does not believe to be indicative of on-going business performance are excluded from these calculations so that investors can better evaluate and analyze historical and future business trends on a consistent basis. Definitions of these non-GAAP measures may not be comparable to similar definitions used by other companies and are not a substitute for similar GAAP measures.

The non-GAAP measures in the following reconciliations are presented in the MD&A.

39

Adjusted Amounts

	Quarter Ended March 31,
(Dollar amounts in millions, except per share data)	2018			2017
Adjusted Operating Profit
Reported operating profit	$	653		$	567
Add: Transaction costs and other charges	19			6
Total adjustments	19			6
Adjusted operating profit	$	672		$	573
Reported percent change	15		%
Adjusted percent change	17		%
Adjusted Income Taxes and Effective Tax Rate
Reported income taxes	$	148		$	149
Add: Transaction costs and other charges	2			—
Total adjustments	2			—
Adjusted income taxes	$	150		$	149

Adjusted Effective Tax Rate
Reported income before income taxes and equity investments	$	605		$	541
Add: Transaction costs and other charges	19			6
Total adjustments	19			6
Adjusted income before income taxes and equity investments	$	624		$	547
Reported effective tax rate	24.5		%	27.5		%
Adjusted effective tax rate	24.0		%	27.2		%
Adjusted Noncontrolling Interests
Reported noncontrolling interests	$	10		$	15
Add: Cost reduction program	(1		)	—
Total adjustments	(1		)	—
Adjusted Noncontrolling Interests	$	9		$	15
Adjusted Net Income - Praxair, Inc.
Reported net income - Praxair, Inc.	$	462		$	389
Add: Transaction costs and other charges	17			6
Add: Cost reduction program	1			—
Total adjustments	18			6
Adjusted net income - Praxair, Inc.	$	480		$	395
Reported percent change	19		%
Adjusted percent change	22		%

Adjusted Diluted Earnings Per Share
Reported diluted EPS	$	1.59		$	1.35
Add: Transaction costs and other charges	0.06			0.02
Total adjustments	$	0.06		$	0.02
Adjusted diluted EPS	$	1.65		$	1.37
Reported percent change	18		%
Adjusted percent change	20		%

40

EBITDA, Adjusted EBITDA, EBITDA Margin and Adjusted EBITDA Margin

These measures are used by investors, financial analysts and management to assess a company’s profitability.

	Quarter Ended March 31,
	2018			2017
(Dollar amounts in millions)
Reported net income - Praxair, Inc.	$	462		$	389
Add: noncontrolling interest	10			15
Add: interest expense - net	46			41
Add: net pension and OPEB cost (benefit), excluding service cost	2			(15		)
Add: income taxes	148			149
Add: depreciation and amortization	311			287
EBITDA	$	979		$	866
Adjustments:
Add: Transaction costs	$	19		$	6
ADJUSTED EBITDA	$	998		$	872
Reported Sales	$	2,999		$	2,728
EBITDA Margin	32.6		%	31.7		%
Adjusted EBITDA Margin	33.3		%	32.0		%

Net Debt, Capital and Debt-to-Capital Ratio

The debt-to-capital ratio is a measure used by investors, financial analysts and management to provide a measure of financial leverage and insights into how the company is financing its operations.

	Three Months Ended March 31,
	2018			2017
(Dollar amounts in millions)
Debt	$	8,842		$	9,368
Less: cash and cash equivalents	(545		)	(519		)
Net debt	8,297			8,849
Equity and redeemable noncontrolling interests
Redeemable noncontrolling interests	13			10
Praxair, Inc. shareholders’ equity	6,368			5,529
Noncontrolling interests	516			436
Total equity and redeemable noncontrolling interests	6,897			5,975
Capital	$	15,194		$	14,824
DEBT-TO-CAPITAL RATIO	54.6		%	59.7		%

41

Forward-looking Statements

This document contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s reasonable expectations and assumptions as of the date the statements are made but involve risks and uncertainties. These risks and uncertainties include, without limitation: the expected timing and likelihood of the completion of the contemplated business combination with Linde AG, including the timing, receipt and terms and conditions of any required governmental and regulatory approvals that could reduce anticipated benefits or cause the parties to abandon the transaction; the occurrence of any event, change or other circumstances that could give rise to the termination of the business combination agreement; the ability to successfully complete the proposed business combination, including satisfying closing conditions; the success of the business following the proposed business combination; the ability to successfully integrate the Praxair and Linde businesses; the risk that the combined company may be unable to achieve expected synergies or that it may take longer or be more costly than expected to achieve those synergies; the performance of stock markets generally; developments in worldwide and national economies and other international events and circumstances; changes in foreign currencies and in interest rates; the cost and availability of electric power, natural gas and other raw materials; the ability to achieve price increases to offset cost increases; catastrophic events including natural disasters, epidemics and acts of war and terrorism; the ability to attract, hire, and retain qualified personnel; the impact of changes in financial accounting standards; the impact of changes in pension plan liabilities; the impact of tax, environmental, healthcare and other legislation and government regulation in jurisdictions in which the company operates, including the impact of the U.S. Tax Cuts and Jobs Act of 2017; the cost and outcomes of investigations, litigation and regulatory proceedings; the impact of potential unusual or non-recurring items; continued timely development and market acceptance of new products and applications; the impact of competitive products and pricing; future financial and operating performance of major customers and industries served; the impact of information technology system failures, network disruptions and breaches in data security; and the effectiveness and speed of integrating new acquisitions into the business. These risks and uncertainties may cause actual future results or circumstances to differ materially from the GAAP or adjusted projections or estimates contained in the forward-looking statements. The company assumes no obligation to update or provide revisions to any forward-looking statement in response to changing circumstances. The above listed risks and uncertainties are further described in Item 1A (Risk Factors) in the company's latest Annual Report on Form 10-K filed with the SEC and in the proxy statement/prospectus and the offering prospectus included in the Registration Statement on Form S-4 (which Registration Statement was declared effective on August 14, 2017) filed by Linde plc with the SEC which should be reviewed carefully. Please consider the company’s forward-looking statements in light of those risks.

42

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Refer to Item 7A. to Part II of Praxair’s 2017 Annual Report on Form 10-K for discussion.

Item 4. Controls and Procedures

(a) Based on an evaluation of the effectiveness of Praxair’s disclosure controls and procedures, which was made under the supervision and with the participation of management, including Praxair’s principal executive officer and principal financial officer, the principal executive officer and principal financial officer have each concluded that, as of the end of the quarterly period covered by this report, such disclosure controls and procedures are effective in ensuring that information required to be disclosed by Praxair in reports that it files under the Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and accumulated and communicated to management including Praxair’s principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure.

(b) There were no changes in Praxair’s internal control over financial reporting that occurred during the quarterly period covered by this report that have materially affected, or are reasonably likely to materially affect, Praxair’s internal control over financial reporting.

43

PART II - OTHER INFORMATION

Praxair, Inc. and Subsidiaries

Item 1. Legal Proceedings

See Note 12 to the condensed consolidated financial statements for a description of current legal proceedings.

Item 1A. Risk Factors

There have been no material changes to the risk factors disclosed in Item 1a to Part I of Praxair’s 2017 Annual Report on Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of Equity Securities- Certain information regarding purchases made by or on behalf of the company or any affiliated purchaser (as defined in Rule 10b-18(a)(3) under the Securities Exchange Act of 1934, as amended) of its common stock during the quarter ended March 31, 2018 is provided below:

Period	Total Number of Shares Purchased (Thousands)	Average Price Paid Per Share		Total Numbers of Shares Purchased as Part of Publicly Announced Program (1) (Thousands)	Approximate Dollar Value of Shares that May Yet be Purchased Under the Program (2) (Millions)
January 2018	—	$	—	—	$	1,580
February 2018	—	$	—	—	$	1,580
March 2018	3	$	158.56	3	$	1,580
First Quarter 2018	3	$	158.56	3	$	1,580

(1) On January 28, 2014, the Company's board of directors approved the repurchase of $1.5 billion of its common stock ("2014 program") which could take place from time to time on the open market (which could include the use of 10b5-1 trading plans) or through negotiated transactions, subject to market and business conditions.

(2) As of March 31, 2018, the Company purchased $1,420 million of its common stock pursuant to the 2014 program, leaving an additional $80 million remaining authorized under the 2014 program. The 2014 program does not have any stated expiration date. In addition, on July 28, 2015, the Company’s board of directors approved the repurchase of $1.5 billion of its common stock (“2015 program”) which could take place from time to time on the open market (which could include the use of 10b5-1 trade plans) or through negotiated transactions, subject to market and business conditions. The 2015 program does not have any stated expiration date. The 2015 program is in addition to the 2014 program.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

44

Item 6. Exhibits

(a)	Exhibits
	*10.01	Separation Agreement and General Release dated April 6, 2018, by and between Praxair, Inc. and Scott Telesz, Executive Vice President of Praxair
	12.01	Computation of Ratio of Earnings to Fixed Charges.
	31.01	Rule 13a-14(a) Certification
	31.02	Rule 13a-14(a) Certification
	32.01	Section 1350 Certification (such certifications are furnished for the information of the Commission and shall not be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act).
	32.02	Section 1350 Certification (such certifications are furnished for the information of the Commission and shall not be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act).
	101.INS	XBRL Instance Document
	101.SCH	XBRL Taxonomy Extension Schema
	101.CAL	XBRL Taxonomy Extension Calculation Linkbase
	101.LAB	XBRL Taxonomy Extension Label Linkbase
	101.PRE	XBRL Taxonomy Extension Presentation Linkbase
	101.DEF	XBRL Taxonomy Extension Definition Linkbase

*    Indicates a management contract or compensatory plan or arrangement.

45

SIGNATURE

Praxair, Inc. and Subsidiaries

Pursuant to the requirements 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.

	PRAXAIR, INC.
	(Registrant)
Date: April 26, 2018	By: /s/ Kelcey E. Hoyt
	Kelcey E. Hoyt
	Vice President and Controller
	(On behalf of the Registrant
	and as Chief Accounting Officer)

46

EX-10.01

SEPARATION AGREEMENT AND GENERAL RELEASE

Praxair, Inc. and Subsidiaries

EXHIBIT 10.01

This is a SEPARATION AGREEMENT AND GENERAL RELEASE (hereinafter referred to as the “Agreement”), made and entered into by and between Praxair, Inc. (hereinafter referred to as “Praxair”) and Scott Telesz (hereinafter referred to as “Employee”).

WHEREAS, Praxair and Employee have mutually agreed to the terms and conditions of the termination of Employee’s employment relationship with Praxair; and

WHEREAS, Praxair wishes to assist Employee in his transition from Praxair employment and to provide the consideration described herein in lieu of any severance benefits under the Praxair, Inc. Severance Program (the “Severance Program”), the Severance Compensation Agreement between Praxair and Employee, dated as of April 27, 2010 and amended as of December 11, 2012 (the “Severance Agreement”), or any other plan, program, policy or agreement.

NOW, THEREFORE, in consideration of the promises and conditions set forth herein, the sufficiency of which is hereby acknowledged, and intending to be legally bound, Praxair and Employee agree as follows:

1. Definitions. As used in this Agreement, any reference to “Praxair” shall include its predecessors and successors and, in their capacities as such, all of its present, past, and future directors, officers, employees, representatives, attorneys, insurers, reinsurers, agents and assigns, as well as its parents, affiliates, divisions and subsidiaries, and any reference to Employee shall include, in their capacities as such, his heirs, administrators, representatives, attorneys, agents, and assigns.

2. Termination of Employment Relationship. Employee and Praxair will end their employment relationship on May 1, 2018 (the “Termination Date”). Upon the Termination Date, Employee’s employment with Praxair will terminate and Employee shall no longer be authorized to represent, act as an agent for, transact business or incur any expenses, obligations and liabilities on behalf of Praxair; provided, however, that Praxair may determine at any time prior to the Termination Date to terminate the Employee’s employment provided Praxair pay the Employee through the original Termination Date. Except as otherwise provided herein, Employee will return all Praxair computers, phones, credit cards, keys and other property by no later than the Termination Date. Employee acknowledges (i) Employee has received all compensation due him as a result of services performed for Praxair through the date he signed this Agreement; (ii) Employee has reported to Praxair any and all work-related injuries incurred during employment; (iii) Praxair properly provided any leave of absence because of Employee’s or a family member’s health condition and Employee has not been subjected to any improper treatment, conduct or actions due to a request for or taking such leave; and (iv) Employee has provided Praxair with written notice of

any and all concerns known to Employee regarding suspected ethical and compliance issues or violations on the part of Praxair or any released person or entity.

3. Consideration. Subject to (i) Employee signing and not revoking the General Release attached hereto as Exhibit A (the “General Release”), and (ii) Employee’s on-going compliance with all of the terms and conditions set forth herein, as consideration for entering into this Agreement and the General Release, and in lieu of any and all severance benefits under the Severance Program, the Severance Agreement and any other plan, program, policy or agreement:

a. Praxair shall pay Employee within the timeframe require under applicable law, his full base salary and vacation pay accrued through the Termination Date.

b. Praxair shall pay Employee, not later than 30 days following the Termination Date, a lump sum payment of $179,071.71, representing, and in lieu of, the target variable compensation award that he would have been eligible to receive for the portion of 2018 prior to the Termination Date.

c. To provide benefits to Employee which are equivalent to the benefits that he would have received under the “Account-Based” design component of the Praxair defined benefit pension program for one year following the Termination Date, Praxair shall pay Employee $47,027.00, representing four percent of his annual pension program eligible compensation as in effect immediately prior to the Termination Date. Such amount shall be paid to Employee no later than the 30^th day following the Termination Date.

d. To provide benefits to Employee which are equivalent to the Praxair matching contributions that he would have received under the Praxair Retirement Savings Plan and the notional company contributions that he would have received under the Praxair Compensation Deferral Program for one year following the Termination Date, Praxair shall pay Employee $31,775.00, representing five percent of his annual eligible base salary as in effect immediately prior to the Termination Date. Such amount shall be paid to Employee no later than the 30^th day following the Termination Date.

e. Following the Termination Date, Praxair shall pay Employee a severance allowance of $1,288,175.00, payable in a lump sum within thirty (30) days following the later of the Termination Date or the Effective Date (as defined in Section 8 below).

f. For purposes of all outstanding long-term incentive awards previously granted to Employee under Praxair, Inc.’s long term incentive plans, Employee’s separation from employment on the Termination Date shall be treated as a termination by action of Praxair other than for cause, with the resulting treatment determined in accordance with the applicable terms of each such plan and award. Notwithstanding the foregoing, Praxair hereby amends Section 2.c. of the Restricted Stock Unit Award agreement, dated as of July 24, 2012 and attached hereto as Exhibit B (the “2012 RSU Award Agreement”), to provide for the accelerated vesting of a total of 10,000 restricted stock units

upon the date of the Employee’s termination hereunder. Except as explicitly amended by this Agreement, the terms and provisions of the 2012 RSU Award Agreement shall remain unchanged.

g. Praxair shall make available to Employee at no cost, financial planning services through the Ayco Company (or such other provider as may be selected by Praxair to provide financial planning services to its executives) for a period of one year following the Termination Date.

h. Upon the Termination Date, Praxair shall transfer to Employee ownership of the cell phone, iPad and laptop computer provided to him in connection with his employment. As a condition to such transfer, Employee shall, prior to the Termination Date, provide Praxair physical access to such devices to permanently erase all Praxair confidential and other information and intellectual property.

i. Except as otherwise provided herein, following the Termination Date, Employee’s entitlements under Praxair’s benefit plans, programs, policies or arrangements shall be governed by the terms of each such plan, program, policy or arrangement.

j. Praxair shall provide Employee with its standard outplacement services for an employee of his salary level through Right Associates at no cost to Employee.

4. Taxes.

a. All benefits and payments hereunder will be subject to applicable federal, state and local tax withholdings as determined by Praxair in its sole discretion, and will be reflected on Forms W-2 issued to Employee in the normal course.

b. Employee acknowledges and agrees that Praxair has not made any representation to him or anyone representing him regarding the tax consequences of payments and benefits to be provided pursuant to this Agreement. Employee further agrees that the tax consequences of this Agreement shall have no effect whatsoever on the enforceability of this Agreement. In addition, Employee understands and agrees that Praxair would be obligated to respond truthfully to any inquiry or request for further information by the Internal Revenue Service (“IRS”) or any state taxing authority or to any lawfully issued subpoena concerning the payments to be provided under this Agreement. Employee further understands and agrees that the determination of the tax treatment, if any, of the payments and benefits provided pursuant to this Agreement will be exclusively within the province of the IRS, and any appropriate taxing or judicial authority, pursuant to law. Employee further agrees that he will have no action or claim whatsoever against Praxair relating to the tax treatment of the payments and benefits under this Agreement or information or documents provided to the IRS or any appropriate taxing authority.

5. Other Agreements.

a. Employee expressly acknowledges and reaffirms his continuing obligations (including but not limited to those regarding confidential or proprietary information, trade secrets, and other intellectual property of Praxair) under the Nondisclosure, Nonsolicitation and Noncompetition Agreement, dated as of April 27, 2010 and attached hereto as Exhibit C (the “Restrictive Covenant Agreement”), as amended by Section 5(b) of this Agreement, and under any other agreement he has signed, and under any applicable law.

b. Section 4.1 of the Restrictive Covenant Agreement is hereby amended by the addition of the following after the last sentence of such Section: “However, nothing in this provision shall prohibit Employee from communicating with, evaluating, hiring or assisting in the hiring of any Praxair employee who, without prior direct or indirect contact by or on behalf of Employee, has responded to a general public solicitation of employment including but not limited to any such general solicitation via the internet, newspaper advertisements and the like.”

c. Section 4.3 of the Restrictive Covenant Agreement is hereby amended to reduce the duration of the Restriction on Unfair Competition to a period of one year following the Termination Date. Except as explicitly amended by this Agreement, the terms and provisions of the Restrictive Covenant Agreement shall remain unchanged.

6. Nondisparagement. Employee will not make any statements that are professionally or personally disparaging about, or adverse to, Praxair, including, but not limited to, any statements that disparage Praxair or any product, service, finances, financial condition, capability of Praxair or any other aspect of the business of Praxair. In addition, Employee will not engage in any conduct that is intended to harm, professionally or personally, Praxair’s reputation. Likewise, Praxair will not make any statements that are professionally or personally disparaging about, or adverse to, Employee. In addition, Praxair will not engage in any conduct that is intended to harm, professionally or personally, Employee’s reputation.

7. Cooperation. Employee agrees to cooperate reasonably with Praxair following the Termination Date regarding any pending or subsequently filed litigation, claims or other disputes involving Praxair that relate to matters within the knowledge or responsibility of Employee. Without limiting the foregoing, Employee agrees (i) to meet with Praxair’s representatives, counsel or other designees at mutually convenient times and places with respect to any items within the scope of this provision; (ii) to provide truthful testimony regarding same to any court, agency, or other adjudicatory body; and (iii) to provide Praxair with notice of contact by any adverse party or such adverse party’s representative, except as may be required by law. Praxair will reimburse Employee for reasonable expenses, including attorney’s fees to the extent permitted under Praxair’s By-Laws, in connection with the cooperation described in this Section.

8. Advice of Counsel, Consideration and Revocation Periods, Other Information. Praxair advises Employee to consult with an attorney prior to signing this Agreement. Employee has twenty-one (21) days to consider whether to sign this Agreement, including the General Release, from the date Employee receives this Agreement and any attached information (the “Consideration Period”). Employee must return this signed Agreement, including the signed General Release, to

Praxair’s representative set forth below within the Consideration Period. If Employee signs and returns this Agreement before the end of the Consideration Period, it is because Employee freely chose to do so after carefully considering its terms. Additionally, Employee shall have seven (7) days from the date of the signing of this Agreement and the General Release to revoke this Agreement and the General Release by delivering a written notice of revocation to the person indicated in the General Release. This Agreement will become effective on the eighth day after Employee signs this Agreement and the General Release, subject to Employee not revoking this Agreement or the General Release (the “Effective Date”). Employee agrees with Praxair that changes to this Agreement, whether material or immaterial, do not restart the running of the Consideration Period.

9. Full Satisfaction. The parties understand, agree, and intend that, (i) upon execution of this Agreement and the General Release, Employee will have received full and complete satisfaction of any and all claims, whether known, suspected, or unknown, that he may have or has had against Praxair arising from events, acts or omissions that occurred at any time up to and including the date of the execution of this Agreement and the General Release.

10. Employee Breach. In addition to any other remedies available to Praxair for breach of any provision or obligation under this Agreement, should Employee or any person or entity acting in concert with Employee ever materially breach any provision or obligation under this Agreement, including Section 5, Employee explicitly agrees that: (a) in the event that the act or acts constituting such breach occur prior to the date(s) by which Praxair must pay the consideration described in Sections 3.b., c., d., and/or e., Praxair shall have no obligation to make the respective payment(s); (b) in the event that the act or acts constituting such breach occur on or prior to May 1, 2019, Employee will be required to immediately pay to Praxair liquidated damages in the amount of $500,000; and (c) in the event that the act or acts constituting such breach occur after May 1, 2019 but prior to May 1, 2020, Employee will be required to immediately pay to Praxair liquidated damages in the amount of $250,000. Although Employee is releasing claims under the Age Discrimination in Employment Act (ADEA), the cessation or forfeiture of benefits provisions in this Section do not apply to any challenge he may make to the knowing and voluntary nature of this Agreement under the ADEA and Older Workers’ Benefit Protection Act. Nothing in this Agreement shall affect the remedies available to Praxair under Section 7 of the Restrictive Covenant Agreement.

11. No Interference with Rights. Nothing in this Agreement (including but not limited to Section 5 (Other Agreements), Section 6 (Nondisparagement), and Exhibit A (General Release)) (i) limits or affects Employee’s right to enforce or challenge the validity of this Agreement or (ii) prevents Employee from filing a charge or complaint with or from participating in an investigation or proceeding conducted by the Equal Employment Opportunity Commission, National Labor Relations Board, the Securities and Exchange Commission, or any other any federal, state or local agency charged with the enforcement of any laws, or from exercising rights under Section 7 of the National Labor Relations Act to engage

in protected, concerted activity with other employees, although by signing this Agreement Employee is waiving rights to individual relief (including any money damages, reinstatement or other legal or equitable relief) in any charge, complaint, or lawsuit or other proceeding brought by Employee or on Employee’s behalf by any third party, except where such a waiver of individual relief is prohibited. Notwithstanding Employee’s confidentiality and non-disclosure obligations under this Agreement or otherwise, as provided in the Federal Defend Trade Secret Act, Employee shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made: (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.

12. Construction. This Agreement shall be construed according to its plain language, and not strictly for or against any party hereto. Captions herein are inserted for convenience, do not constitute a part of this Agreement, and shall not be admissible for the purpose of proving the intent of the parties.

13. Entire Agreement. This Agreement and the attached exhibits contain and constitute the entire understanding and agreement between the parties and supersede and cancel all previous negotiations, representations, agreements, commitments, and writings in connection herewith, except as expressly contemplated by this Agreement.

14. No Oral Representations. Employee represents and acknowledges that, in executing this Agreement, he does not rely on and has not relied on any representation or statement made by Praxair or any of Praxair’s agents, representatives or attorneys with regard to the subject matter, basis or effect of this Agreement or otherwise.

15. Severability. Should any provision of this Agreement be declared or determined by any court to be illegal or invalid, the remaining provisions shall nevertheless be binding upon the parties and remain in full force and effect.

16. No Oral Modifications. This Agreement may not be modified in any way except by a signed writing specifically referring to this Agreement and executed by a duly authorized representative of Praxair (excluding Employee).

17. No Admission of Liability. This Agreement shall not be construed as an admission by Praxair of any liability or acts of wrongdoing or unlawful discrimination, nor shall it be considered to be evidence of such liability, wrongdoing, or unlawful discrimination. The Employee will make no inconsistent statement with respect to liability or acts of wrongdoing or unlawful discrimination to anyone for any purpose.

18. Governing Law and Choice of Forum. This Agreement shall be governed by, construed and enforced in accordance with the laws of the state of Connecticut, and any action related to this Agreement must be brought in a court of competent jurisdiction in the state or federal courts of Connecticut. Employee hereby irrevocably consents to personal jurisdiction and venue in said courts.

19. Execution of Agreement. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute one in the same Agreement.

IN WITNESS WHEREOF, all parties have set their hands to this Agreement as of the dates written below.

Date:                        Signature:

4/6/18________________         /s/ Scott Telesz___________________

Scott Telesz

STATE OF Connecticut     )

) ss.                  April 6____________, 2018

COUNTY OF Fairfield        )

Before me personally appeared Scott Telesz, signer and sealer of the foregoing instrument, and he acknowledged the same to be his free act and deed, for the purposes contained therein.

_______________________________

Notary Public

Praxair, Inc.

Date:

4/6/18_________________        By:     /s/ David Strauss__________________

    David Strauss    

Vice President, Chief Human Resources Officer,

Praxair, Inc.

Exhibit A

GENERAL RELEASE

1. In consideration of the promises and benefits set forth in the attached Agreement, I, Scott Telesz, for myself and on behalf of my heirs, assigns, successors, executors and administrators, hereby fully and irrevocably release and discharge Praxair, its predecessors, successors, parents, affiliates, divisions and subsidiaries and, in their capacities as such, all of their present past, and future directors, officers, employees, representatives, attorneys, insurers, reinsurers, agents and assigns, from any and all manner of suits, actions, allegations, charges, claims, complaints, causes of action, grievances, liabilities, demands, entitlements, obligations, promises, damages, agreements, rights, debts and expenses (including attorneys’ fees and costs), of every kind (collectively, “Claims”), either at law or in equity, whether known, unknown or unforeseen, vested or contingent by reason of any matter, cause or thing occurring at any time before and including the date of this release, including all claims arising under or in connection with my employment or separation from employment with Praxair. This includes any Claims under any federal, state, local or municipal law, regulation or decision, including, but not limited to, claims arising under the Age Discrimination in Employment Act of 1967 (ADEA), the Older Worker Benefit Protection Act (OWBPA), Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Americans With Disabilities Act, the Employee Retirement Income Security Act of 1974 (ERISA), the Worker Adjustment and Retraining Notification Act or similar state or local law, or any other federal, state, or local law, statute, regulation, ordinance, or legal decision. It is expressly agreed and understood that this release is a GENERAL RELEASE and that I hereby waive any and all rights under the laws of any jurisdiction in the United States, or any other country, that limit a general release to those Claims that are known or suspected to exist in my favor as of the effective date of this release, except that I am not waiving any Claims related to the attached Agreement, any Claim for employee benefits under plans covered by ERISA to the extent any such Claim may not lawfully be waived or for any payments or benefits under any Praxair plans that have vested according to the terms of those plans, or any Claims that the controlling law clearly states may not be released by private agreement. This General Release shall not waive Claims that may arise for actions or omissions after the date of its execution, including claims arising from breach of the attached Agreement, nor shall it apply to: (a) any rights of indemnification, contribution, or to be held harmless, or to the coverage afforded by any policies of directors’ and officers’ liability insurance, which rights exist as of the date of the attached Agreement; or (b) any claim for unemployment benefits in connection with the termination of my employment with Praxair pursuant to the attached Agreement.

2. I acknowledge that:

(a) I have read this document, and I understand its legal and binding effect. I am acting voluntarily and of my own free will in executing this release.

(b) The consideration for this release is in addition to anything of value to which I already am entitled.

(c) I have been advised, and am being advised by this General Release, to consult with an attorney before executing this release, and I have had the opportunity to seek and have consulted with legal counsel prior to signing this release.

(d) I have been given at least 21 days to consider the terms of this release before signing it. In the event that I sign this release before the expiration of the 21-day period, I acknowledge that I have freely chosen to waive the 21-day period.

3. I understand that if I sign this release, I can change my mind and revoke it within seven days after signing it by sending a written revocation notice by both overnight and certified mail to:

Guillermo Bichara

Vice President, General Counsel & Corporate Secretary

Praxair, Inc.

10 Riverview Drive

Danbury, CT 06810

I have read and understand the General Release set forth above and agree to be bound by its terms.

Signature: /s/ Scott Telesz______________________

Scott Telesz

Date: 4/6/18_________________________________

STATE OF Connecticut        )

) ss.                      April 6____________, 2018

COUNTY OF Fairfield        )

Before me personally appeared Scott Telesz, signer and sealer of the foregoing instrument, and he acknowledged the same to be his free act and deed, for the purposes contained therein.

__________________________________

Notary Public

Exhibit B

RESTRICTED STOCK UNIT AWARD

UNDER THE

2009 PRAXAIR, INC.

LONG TERM INCENTIVE PLAN

Effective as of July 24, 2012(the “Grant Date”), Scott Telesz (the “Participant”) is hereby granted the following Restricted Stock Unit (“RSU”) Award under the 2009 Praxair, Inc. Long Term Incentive Plan (the “Plan”), subject to the terms and conditions of the Plan, which are incorporated herein by reference, and those set forth below. The Plan shall control in the event of any conflict between the terms and conditions of the Plan and those set forth in this Award.

This Award has been conveyed and will be managed online, and the Participant’s online acceptance and acknowledgement of this Award constitutes his or her acceptance of all of the terms and conditions of the Plan and this Award. A copy of the Plan has been made available to the Participant, and the Participant hereby acknowledges that he or she has read and understands the Plan and this Award.

Capitalized terms used herein and not defined shall have the meanings set forth in the Plan, as the same may be amended from time to time. For purposes of this Award, Praxair, Inc. (the “Company”) and its Subsidiaries are collectively referred to herein as “Praxair”.

1. Award of Restricted Stock Units. The Participant is hereby granted an award of 20,000notional RSUs (the “Award”). Each RSU represents a bookkeeping entry which is intended to be equal in value to a single Share.

2. Vesting of Award; Treatment upon Termination of Service or Change in Control.

a. Vesting Generally. Except as otherwise provided in either the Plan or this Section 2., this Award shall vest as to 10,000 RSUs on each of August 31, 2022 and August 31, 2027, if, and only if, the Participant has remained continuously employed by Praxair at all times from the Grant Date through the respective August 31 vesting date.

b. Death, Disability. Notwithstanding Section 2.a., in the event the Participant’s employment by Praxair terminates by reason of his death, or the Participant becomes Totally and Permanently Disabled (as defined below) while employed by Praxair, in either case, after the Grant Date and prior to August 31, 2027, 10,000 RSUs shall become immediately vested, and any unvested portion of the Award thereafter remaining shall be immediately forfeited. For purposes of this Award, the Participant shall be “Totally and Permanently Disabled” if he is determined by Praxair to be unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months.

c. Termination by Action of Praxair Other than for Cause. Notwithstanding Section 2.a., in the event the Participant’s employment is terminated by action of Praxair other than for cause after the Grant Date and prior to August 31, 2027, 5,000 RSUs shall become vested immediately following the effective date of such termination of employment, and any unvested portion of the Award thereafter remaining shall be immediately forfeited. For purposes of this Award the Participant’s termination by action of Praxair for cause, shall include, but not be limited to, the Participant’s termination by action of Praxair for violation of Praxair’s Standards of Business Integrity or poor performance.

d. Change in Control. Notwithstanding Section 2.a., the provisions of Article 16 of the Plan shall apply in the event of a Change in Control occurring prior to August 31, 2027.

e. Forfeiture of Award. Except as otherwise provided under Article 16 of the Plan in connection with a Change in Control, in the event the Participant’s employment with Praxair terminates for any reason other than those specifically set forth in Sections 2.b., or 2.c. prior to August 31, 2027, any unvested portion of this Award shall be immediately forfeited. In the event any portion of this Award is forfeited for any reason, no payment shall be made in settlement of such portion.

3. Payment of Vested Award. As soon as practicable following the date any portion of this Award becomes vested, such portion shall be settled by payment to the Participant of a number of Shares equal to the number of RSUs then first becoming vested or, in connection with a Change in Control, such other form of payment having an equivalent value as may be authorized by the Committee in its sole discretion. In no event shall any payment in

settlement of any portion of this Award be made later than December 31 of the year in which such portion first becomes vested.

4. Other Terms and Conditions. It is understood and agreed that the Award of RSUs evidenced hereby is subject to the following terms and conditions:

a. Rights of Participant. Except as provided in Section 4.d., the Participant shall have no right to transfer, pledge, hypothecate or otherwise encumber the Award. Prior to the payment of Shares in satisfaction of any portion of this Award, the Participant shall have none of the rights of a stockholder of the Company with respect to such portion of the Award, including, but not limited to, voting rights and the right to receive or accrue dividends or dividend equivalents.

b. No Right to Continued Employment. This Award shall not confer upon the Participant any right with respect to continuance of employment by Praxair nor shall this Award interfere with the right of Praxair to terminate the Participant’s employment.

c. No Right to Future Awards. The selection of recipients of RSUs and other Awards under the Plan is determined on the basis of several factors, including job responsibilities and anticipated future job performance. The Participant’s selection to receive this Award shall in no way entitle him to receive, or otherwise obligate Praxair to provide the Participant, any future RSUs or other awards under the Plan or otherwise.

d. Transferability. This Award is not transferable other than:

(i) in the event of the Participant’s death, in which case this Award shall be transferred pursuant to the beneficiary designation then on file with the Company, or, in the absence of such a beneficiary designation, to the Participant’s executor, administrator, or legal representative, or

(ii) pursuant to a domestic relations order.

Any transfer of this Award, in whole or in part, is subject to acceptance by the Company in its sole discretion and shall be affected according to such procedures as the Company’s Vice President, Human Resources may establish. The provisions of this Award, relating to the Participant, shall apply to this Award notwithstanding any transfer to a third party.

e. Cancellation of Award. Notwithstanding any other provision of this Award, the Committee may, in its sole discretion, cancel, rescind, suspend, withhold, or otherwise limit or restrict this Award, and/or recover any gains realized by the Participant in connection with this Award, in the event any actions by the Participant are determined by the Committee to (i) constitute a conflict of interest with Praxair, (ii) be prejudicial to Praxair’s interests, or (iii) violate any non-compete agreement or obligation of the Participant to Praxair, any confidentiality agreement or obligation of the Participant to Praxair, Praxair’s applicable policies, or the Participant’s terms and conditions of employment.

5. Tax Withholding. Upon the date of payment of the Award, Praxair will deduct from the number of Shares otherwise due the Participant, Shares having a Market Price sufficient to discharge all applicable federal, state, city, local or foreign taxes of any kind required to be withheld with respect to such payment. In the alternative, Praxair shall have the right to require the Participant to pay cash to satisfy any applicable withholding taxes as a condition to the payment of the Award.

6. References. References herein to rights and obligations of the Participant shall apply, where appropriate, to the Participant’s legal representative or estate without regard to whether specific reference to such legal representative or estate is contained in a particular provision of this Award.

7. Governing Law. This Award shall be governed by and construed in accordance with the laws of Connecticut, without giving effect to principles of conflict of laws.

IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its proper officer hereunto duly authorized, as of the day and year first hereinabove written.

Praxair, Inc.

By: /s/ Sally Savoia

Sally A. Savoia

Vice President, Human Resources

EXHIBIT C

NONDISCLOSURE, NONSOLICITATION AND NONCOMPETITION AGREEMENT

THIS NONDISCLOSURE, NONSOLICITATION AND NONCOMPETITION AGREEMENT (“Agreement”), dated as of April 27, 2010, is between Scott Telesz (“Employee”) and Praxair, Inc. (Praxair, Inc. and its Affiliates are collectively referred to herein as “Praxair”). Employee and Praxair are collectively referred to herein as the “Parties”.

SECTION 1. Reason for Agreement. The industrial gases and other businesses in which Praxair participates are intensely competitive. All of the major companies that compete in these businesses are continually searching for competitive advantage that will give them a benefit over their competitors in the marketplace. Praxair develops its employees by providing them with training, education, access to Praxair’s intellectual property, systems, strategies and other confidential information in order to make them as competitive and effective as possible in performing their jobs for the benefit of Praxair’s shareholders and other constituencies with an interest in Praxair’s success: its employees, customers, suppliers and the communities in which Praxair does business. The loss of an employee represents the loss of a significant investment and competitive asset to Praxair, and if the employee is lost to a competitor, that investment could be used against Praxair in the competitive marketplace. The purpose of this Agreement is to protect Praxair’s investment in its employees, its strategic Confidential Information (as defined herein) and customers, and to prevent that investment from being used against Praxair for a reasonable period of time.

SECTION 2. Consideration. Employee acknowledges that Praxair has offered Employee both the benefits and protection under a CIC Agreement (as defined herein), as well as continued eligibility to participate in the Variable Compensation Plan (as defined herein), as consideration for Employee’s agreement to all the terms of this Agreement. Employee understands and agrees that this consideration has material value and benefit, above and beyond any continuation of Praxair employment, and that Employee would not be entitled to such consideration unless he or she signs and agrees to be bound by this Agreement. Praxair agrees to provide Employee this consideration only in exchange for his or her compliance with all the terms of this Agreement.

SECTION 3. Confidentiality and Business Interests. Employee agrees to:

• keep secret and confidential and neither use nor disclose, by any means, either during or subsequent to his or her employment, any Confidential Information except as provided below or required in his or her employment with, or authorized in writing by, Praxair;

• assign to Praxair or its designee (and Employee hereby does assign), all right, title and interest in and to all Subject Developments;

• promptly disclose to Praxair all Subject Developments, in writing and in reasonable detail, and to assist in the preparation of and to execute all appropriate papers or documents and otherwise provide proper assistance to enable Praxair to secure, maintain, enforce and defend its patents, copyrights and any other legal protection available for such Subject Developments in any and all countries;

• not disclose to Praxair nor to utilize in Employee’s work for Praxair any confidential information or trade secrets of others known to Employee (including prior employers);

• keep confidential and not disclose or use, either during or subsequent to Employee’s employment, any confidential information or trade secrets of others which Employee receives during the course of his or her employment with Praxair for so long as and to the same extent as Praxair is obligated to retain such information or trade secrets in confidence; and

• deliver to Praxair promptly upon the end of Employee’s employment all written and other materials which constitute or contain Confidential Information or Subject Developments or which are the property of Praxair, and to not remove or take any such written and other materials.

These obligations will not apply to Confidential Information to the extent that it: (a) is or becomes publicly known by means other than Employee’s failure to live up to his or her obligations under this Agreement; (b) was known to Employee prior to disclosure to Employee by or on behalf of Praxair and Employee can prove it; or (c) is received by Employee in good faith from a third party (not an Affiliate) which has no obligation of confidentiality to Praxair with respect thereto. Notwithstanding anything contained herein to the contrary, Confidential Information will not lose its protected status under this Agreement if it becomes generally known to the public or to other persons through improper means. Praxair’s confidential exchange of Confidential Information with a third party for business purposes will not remove it from protection under this Agreement.

If disclosure of Confidential Information or Subject Developments is compelled by law, Employee shall give Praxair as much written notice as possible under the circumstances, will refrain from use or disclosure for as long as the law allows, and will cooperate with Praxair to protect such information, including taking every reasonable step necessary to protect against unnecessary disclosure.

Employee acknowledges that he or she has been notified by Praxair that the provisions of this Section 3 do not apply to any invention with respect to which no equipment, supplies, facility, or Confidential Information of Praxair was used and which was developed entirely on Employee’s own time, unless the invention: (a) relates to Praxair’s business or actual or demonstrably anticipated research or development; or (b) results from any work performed by Employee for Praxair. Employee also understands and acknowledges that the copyrights in all copyrightable works prepared by Employee, alone or with others, in the course of his or her employment are owned solely by Employee’s employer.

The provisions of this Section 3 shall continue in effect for the duration of Employee’s employment with Praxair at any and all locations, either in the United States or a foreign country and its obligations shall survive the termination of Employee’s employment for any reason.

SECTION 4. Protective Covenants. Employee agrees that the following covenants are (a) ancillary to the other enforceable agreements contained in this Agreement, and (b) reasonable and necessary to protect legitimate Praxair business interests.

4.1    Restriction on Interfering with Employee Relationships.Employee agrees that for a period of two (2) years following the end of his or her employment with Praxair, Employee will not interfere with Praxair’s business relationship with a Praxair employee, by soliciting or communicating with such an employee to induce or encourage him or her to leave Praxair’s employ (regardless of who first initiates the communication), by helping another person or entity evaluate a Praxair employee as an employment candidate, or by otherwise helping any person or entity hire an employee away from Praxair; unless a duly authorized Praxair officer gives Employee written authorization to do so.

4.2    Restriction on Interfering with Customer Relationships.Employee agree

s that for a period of two (2) years following the end of his or her employment with Praxair, Employee will not interfere with Praxair’s business relationships with a Covered Customer, by soliciting or communicating (regardless of who initiates the communication) with a Covered Customer to induce or encourage the Covered Customer to: (a) stop or reduce doing business with Praxair, or (b) to buy a Conflicting Product or Service; unless a duly authorized Praxair officer gives Employee written authorization to do so. The Parties agree this restriction is inherently reasonable.

4.3    Restriction on Unfair Competition. Employee agrees that for a period of two (2) years following the end of his or her employment with Praxair, Employee will not participate in, supervise, or manage (as an employee, consultant, contractor, officer, owner, director, or otherwise) Competing Activities in the Restricted Area.

4.4    Survival of Restrictions. (a) Before accepting new employment, Employee will advise every future employer of the restrictions in this Agreement. Employee agrees that Praxair may advise a future employer or prospective employer of this Agreement and its position on the potential application of this Agreement. (b) The Agreement’s post-employment obligations will survive the termination of Employee’s employment with Praxair, regardless of the cause of the termination. If Employee violates one of the post-employment restrictions in this Agreement on which there is a specific time limitation, the time period for that restriction will be extended by one day for each day Employee violates it, up to a maximum extension equal to the length of time prescribed for the restriction, so as to give Praxair the full benefit of the bargained-for length of forbearance. (c) It is the intention of the Parties that, if any court construes any provision or clause of this Agreement, or any portion thereof, to be illegal, void or unenforceable, because of duration of such provision, the geographic scope or the subject matter covered thereby, such court shall reduce the duration, area, or matter of such provision, and, in its reduced form, such provision shall then be enforceable and shall be enforced. (d) If Employee becomes employed with an Affiliate without signing a new agreement, the Affiliate will step into Praxair’s position under this Agreement, and will be entitled to the same protections and enforcement rights as Praxair.

4.5    State Specific Modifications. While employee is a resident of Connecticut, the restrictions on use or disclosure of Confidential Information in Section 3 will only apply for three (3) years after the end of Employee’s employment, where information that does not qualify as a trade secret is concerned; however, the restrictions will continue to apply to trade secret information for as long as the information at issue remains qualified as a trade secret.

SECTION 5. Definitions. For purposes of this Agreement, the following terms shall have the meanings assigned to them below:

5.1“Affiliate” means: (a) any corporation 10% or more of the voting stock of which is owned or controlled by Praxair, Inc., or (b) any corporation owning or controlling 50% or more of the voting stock of Praxair, Inc.; or (c) any corporation 25% or more of the voting stock of which is owned or controlled by a corporation owning or controlling 50% or more of the voting stock of Praxair, Inc.; or (d) any unincorporated entity, including a partnership, in which Praxair, Inc. has a 25% or more ownership interest, or which has a 50% or more ownership interest in Praxair, Inc., or in which an entity having a 50% or more ownership interest in Praxair, Inc. has a 25% or more ownership interest.

5.2“CIC Agreement” means the Severance Compensation Agreement, the form of which is attached hereto, that will provide Employee with severance and other valuable benefits in the event his or her Praxair employment terminates for certain reasons within two (2) years after a change in control of

Praxair (as defined in the CIC Agreement).

5.3“Competing Activities” are any activities or services undertaken on behalf of a competitor (which is understood to mean any person or entity engaged in the business of providing a Conflicting Product or Service in the Restricted Area) that are the same or similar in function or purpose to those Employee performed for Praxair in the two (2) year period preceding the end of Employee’s employment with Praxair, or that are otherwise likely to result in the use or disclosure of Confidential Information. Competing Activities are understood to exclude: activities on behalf of an independently operated subsidiary, division, or unit of a diversified corporation or similar business that has common ownership with a competitor so long as the independently operated business unit does not involve a Conflicting Product or Service; and, a passive and non-controlling ownership interest in a competitor through ownership of less than 2% of the stock in a publicly traded company.

5.4“Confidential Information” includes but is not limited to: (a) any technical or business information, know-how or trade secrets, patentable or not, in any form, including but not limited to data; diagrams; business, marketing or sales plans; notes; drawings; models; prototypes; specifications; manuals; memoranda; reports; customer or vendor information; pricing or cost information; and computer programs, which are furnished to Employee by Praxair or which Employees procures or prepares, alone or with others, in the course of his or her employment; and (b) Subject Developments.

5.5“Conflicting Product or Service” is a product and/or service that is the same or similar in function or purpose to a Praxair product and/or service, such that it would replace or compete with: (a) a product and/or service Praxair provides to its customers; or (b) a product or service that is under development or planning by Praxair but not yet provided to customers and regarding which Employee was provided Confidential Information in the course of employment. Conflicting Products or Services do not include a product or service of Praxair if Praxair is no longer in the business of providing such product or service to its customers at the relevant time of enforcement.

5.6    “Covered Customer” is a Praxair customer (person or entity) Employee had business-related contact or dealings with, or received Confidential Information about, in the two (2) year period preceding the end of Employee’s employment with Praxair. References to the end of Employee’s employment in this Agreement refer to the end, whether by resignation or termination, and without regard for the reason employment ended.

5.7    “Restricted Area” is the United States and the additional areas within Asia, Europe, North America, Central America and South America where Praxair marketed (either individually, through subsidiaries, and/or through strategic alliances or partner companies) its products and services at any time during the twelve months preceding the termination of Employee’s employment with Praxair. The Parties agree that, at the time of execution of this Agreement, the Restricted Area includes, but is not necessarily limited to: China, Austria, India, Japan, Korea, Malaysia, Singapore, Taiwan, Thailand, Canada, Belgium, Bosnia-Herzegovina, Bulgaria, Croatia, Czech Republic, Denmark, France, Germany, Hungary, Italy, Netherlands, Norway, Portugal, Romania, Russia, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland, Ukraine, United Kingdom, Argentina, Costa Rica, Mexico, Puerto Rico, United States, Bolivia, Brazil, Chile, Columbia, Paraguay, Peru, Uruguay, and Venezuela.

5.8    “Subject Developments” means all inventions, discoveries, improvements, developments, technical information, and know-how, (patentable or not), made, developed, invented, discovered or conceived by Employee, alone or with others, in the course or as a result of such employment or tasks assigned Employee by Praxair.

5.9    “Variable Compensation Plan” means the 2002 Praxair, Inc. Variable Compensation Plan, as may be amended from time to time, or any successor variable compensation plan adopted by Praxair.

SECTION 6. Notices. While employed by Praxair, and for two (2) years thereafter, Employee will: (a) give Praxair written notice at least thirty (30) days prior to going to work for a competitor; (b) provide Praxair with sufficient information about his or her new position to enable Praxair to determine if Employee’s services in the new position would likely lead to a violation of this Agreement; and (c) within thirty days of Praxair’s request, participate in a mediation or in-person conference to discuss and/or resolve any issues raised by Employee’s new position. Employee will be responsible for all consequential damages caused by failure to give Praxair notice as provided in this Section.

SECTION 7. Remedies. If Employee breaches or threatens to breach this Agreement, Praxair may recover: (a) an order of specific performance or declaratory relief; (b) injunctive relief by temporary restraining order, temporary injunction, and/or permanent injunction; (c) damages; (d) attorney's fees and costs incurred in obtaining relief; and (e) any other legal or equitable relief or remedy allowed by law. One Thousand Dollars ($1,000.00) is the agreed amount for the bond to be posted if an injunction is sought by Praxair to enforce the restrictions in this Agreement on Employee. Employee also agrees that if s/he challenges the enforceability of the Protective Covenants in Section 4 of this Agreement, and any such provisions are found to be unenforceable, then:  (x) Employee will owe Praxair an amount equal to the sum of any and all such payments, including the value of any benefits provided in kind, that Employee has received under the CIC Agreement and Employee will waive his/her right to any further benefits thereunder; and (y) Employee will owe Praxair an amount equal to the sum of any and all payments that Employee has received under the Variable Compensation Plan during the two (2) year period immediately preceding the end of Employee’s employment with Praxair.

SECTION 8. Severability, Waiver, Modification, Assignment, Governing Law. (a) It is the intention of the Parties that if any provision of the Agreement is determined by a court of competent jurisdiction to be void, illegal or unenforceable, in whole or in part, all other provisions will remain in full force and effect, as if the void, illegal, or unenforceable provision is not part of the Agreement. (b) If either Party waives his, her, or its right to pursue a claim for the other’s breach of any provision of the Agreement, the waiver will not extinguish that Party’s right to pursue a claim for a subsequent breach. (c) Except where otherwise expressly indicated, the Agreement contains the Parties’ entire agreement concerning the matters covered in it; provided that if a post-employment restrictive covenant in this Agreement is found unenforceable (despite, and after application of, any applicable right to reformation that could add or renew enforceability), then any prior agreement between the Parties that would provide for a restriction on the same or substantially similar post-employment conduct of Employee shall not be considered superseded and shall remain in effect. The Agreement may not be waived, modified, altered or amended except by written agreement of all Parties or by court order. (d) The Agreement will inure to the benefit of Praxair’s successors in interest, Affiliates, subsidiaries, parents, purchasers, or assignees, and may be enforced by any one or more of same, without need of any further authorization or agreement from Employee. (e) The laws of the State of Connecticut will govern the Agreement, the construction of its terms, and the interpretation of the rights and duties of the Parties, regardless of any conflicts of law principles of the state. The exclusive venue for any legal action arising from this Agreement will be the state or federal courts of Connecticut. Employee stipulates and consents to the state or federal courts of Connecticut’s personal jurisdiction over him or her, and waives his or her right to objection to a Connecticut court’s jurisdiction.

SECTION 9. Jury Trial Waiver. The Parties hereby waive their right to jury trial on any legal dispute arising from or relating to this Agreement, and consent to the submission of all issues of fact and law arising from this Agreement to the judge of a court of competent jurisdiction as otherwise provided for

above.

SECTION 10. Effect on Prior Agreements. Except as otherwise provided herein, this Agreement shall supersede the Non Compete and Non Solicitation Agreement between Praxair and the Employee dated as of February 24, 1999 that Employee previously entered into as a condition of employment with, or promotion by, Praxair. Employee acknowledges that the obligations undertaken in this Agreement are separate from his or her obligations to Praxair in other agreements Employee has with Praxair, including but not limited to any Confidentiality or Memorandum of Employment Agreement, and that the enforceability of this Agreement has no bearing on any other agreements.

Nothing in this Agreement will be construed to create a contract of employment for a definite period of time or to prohibit either Party from having the freedom to end the employment relationship at-will, with or without cause.

AGREED to and effective as of April 27, 2010.

EMPLOYEE: /s/ Scott Telesz______________________ (signature)	PRAXAIR, INC. By: /s/Stephen F. Angel__________________         Stephen F. Angel
Printed Name: Scott Telesz.	Its: Chairman and Chief Executive Officer

EX-12.01

RATIO OF EARNINGS TO FIXED CHARGES
				Praxair, Inc. and Subsidiaries
										Exhibit 12.01
	Three Months Ended March 31,			Year Ended December 31,
(Dollar amounts in millions, except ratios)	2018			2017			2016			2015			2014
Pre-tax income from continuing operations before adjustment for
noncontrolling interests in consolidated subsidiaries or income or
loss from equity investees	$	605		$	2,287		$	2,048		$	2,160		$	2,395
Capitalized interest	(4		)	(28		)	(34		)	(33		)	(38		)
Depreciation of capitalized interest	6			17			19			22			27
Dividends from less than 50%-owned companies carried at equity	19			111			8			11			6
Adjusted pre-tax income from continuing operations before adjustment
for noncontrolling interests in consolidated subsidiaries or income
or loss from equity investees	$	626		$	2,387		$	2,041		$	2,160		$	2,390
Fixed charges
Interest on long-term and short-term debt	$	46		$	161		$	190		$	161		$	213
Capitalized interest	4			28			34			33			38
Rental expenses representative of an interest factor	12			49			47			47			52
Total fixed charges	$	62		$	238		$	271		$	241		$	303
Adjusted pre-tax income from continuing operations before adjustment
for noncontrolling interests in consolidated subsidiaries or income or
loss from equity investees plus total fixed charges	$	688		$	2,625		$	2,312		$	2,401		$	2,693
RATIO OF EARNINGS TO FIXED CHARGES	11.1			11.0			8.5			10.0			8.9

EX-31.01

RULE 13a-14(a) CERTIFICATIONS

Praxair, Inc. and Subsidiaries

EXHIBIT 31.01

I, Stephen F. Angel, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Praxair, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing equivalent function):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

April 26, 2018	By: /s/ Stephen F. Angel
	Stephen F. Angel
	Chairman, President
	Chief Executive Officer
	(principal executive officer)

EX-31.02

RULE 13a-14(a) CERTIFICATIONS

Praxair, Inc. and Subsidiaries

EXHIBIT 31.02

I, Matthew J. White, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Praxair, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing equivalent function):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

April 26, 2018	By: /s/ Matthew J. White
	Matthew J. White
	Senior Vice President and
	Chief Financial Officer
	(principal financial officer)

EX-32.01

SECTION 1350 CERTIFICATION

Praxair, Inc. and Subsidiaries

EXHIBIT 32.01

Pursuant to 18 U.S.C. § 1350, the undersigned officer of Praxair, Inc. (the “Company”), hereby certifies that the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2018 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

April 26, 2018	By: /s/ Stephen F. Angel
	Stephen F. Angel
	Chairman, President
	Chief Executive Officer
	(principal executive officer)

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350 and is not being filed as part of the Report or as a separate disclosure document.

A signed original of this written statement required by 18 U.S.C. § 1350 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.02

SECTION 1350 CERTIFICATION

Praxair, Inc. and Subsidiaries

EXHIBIT 32.02

Pursuant to 18 U.S.C. § 1350, the undersigned officer of Praxair, Inc. (the “Company”), hereby certifies that the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2018 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

April 26, 2018	By: /s/ Matthew J. White
	Matthew J. White
	Senior Vice President and
	Chief Financial Officer
	(principal financial officer)

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350 and is not being filed as part of the Report or as a separate disclosure document.

A signed original of this written statement required by 18 U.S.C. § 1350 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document and Entity Information	3 Months Ended
	Mar. 31, 2018 shares
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q1
Trading Symbol	PX
Entity Registrant Name	PRAXAIR INC
Entity Central Index Key	0000884905
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding	287,369,483

XML

Consolidated Statements of Income - USD ($) shares in Thousands, $ in Millions		3 Months Ended
		Mar. 31, 2018	Mar. 31, 2017
SALES	[1]	$ 2,999	$ 2,728
Cost of sales, exclusive of depreciation and amortization		1,677	1,549
Selling, general and administrative		310	290
Depreciation and amortization		311	287
Research and development		24	23
Transaction costs and other charges		19	6
Other income (expense) - net		(5)	(6)
OPERATING PROFIT		653	567
Interest expense - net		46	41
Net pension and OPEB cost (benefit), excluding service cost		2	(15)
INCOME BEFORE INCOME TAXES AND EQUITY INVESTMENTS		605	541
Income taxes		148	149
INCOME BEFORE EQUITY INVESTMENTS		457	392
Income from equity investments		15	12
NET INCOME (INCLUDING NONCONTROLLING INTERESTS)		472	404
Less: noncontrolling interests		(10)	(15)
NET INCOME - PRAXAIR, INC.		$ 462	$ 389
PER SHARE DATA - PRAXAIR, INC. SHAREHOLDERS
Basic earnings per share (usd per share)		$ 1.61	$ 1.36
Diluted earnings per share (usd per share)		1.59	1.35
Cash dividends per share (usd per share)		$ 0.8250	$ 0.7875
WEIGHTED AVERAGE SHARES OUTSTANDING (000’s):
Basic shares outstanding (in shares)		287,504	285,509
Diluted shares outstanding (in shares)		290,809	287,384
Parent [Member]
Net Income (Loss), Including Portion Attributable to Nonredeemable Noncontrolling Interest	[2]	$ 462	$ 389
NET INCOME - PRAXAIR, INC.			$ 389

[1] Sales reflect external sales only. Intersegment sales, primarily from North America to other segments, were not material

[2] Net income for noncontrolling interests excludes Net income related to redeemable noncontrolling interests of $1 million for three months ended March 31,2018 (net income was insignificant for the same time period in 2017) which is not part of total equity (see redeemable noncontrolling interests section below).

XML

Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Statement of Comprehensive Income [Abstract]
NET INCOME (INCLUDING NONCONTROLLING INTERESTS)	$ 472	$ 404
Translation adjustments:
Foreign currency translation adjustments	106	317
Income taxes	9	3
Translation adjustments	115	320
Funded status - retirement obligations (Note 11):
Retirement program remeasurements	1	(3)
Reclassifications to net income	17	4
Income taxes	(4)	(1)
Funded status - retirement obligations	14	0
Derivative instruments (Note 6):
Current quarter unrealized gain (loss)	0	1
Reclassifications to net income	0	0
Income taxes	0	1
Derivative instruments	0	0
TOTAL OTHER COMPREHENSIVE INCOME (LOSS)	129	320
COMPREHENSIVE INCOME (LOSS) (INCLUDING NONCONTROLLING INTERESTS)	601	724
Less: noncontrolling interests	(21)	(20)
COMPREHENSIVE INCOME (LOSS) - PRAXAIR, INC.	$ 580	$ 704

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
ASSETS
Cash and cash equivalents	$ 545	$ 617
Accounts receivable - net	1,900	1,804
Inventories	619	614
Prepaid and other current assets	265	250
TOTAL CURRENT ASSETS	3,329	3,285
Property, plant and equipment (less accumulated depreciation of $14,103 in 2018 and $13,819 in 2017)	12,113	12,057
Goodwill	3,274	3,233
Other intangible assets - net	547	553
Other long-term assets	1,329	1,308
TOTAL ASSETS	20,592	20,436
LIABILITIES AND EQUITY
Accounts payable	988	972
Short-term debt	527	238
Current portion of long-term debt	979	979
Other current liabilities	1,040	1,118
TOTAL CURRENT LIABILITIES	3,534	3,307
Long-term debt	7,336	7,783
Other long-term liabilities	2,825	2,824
TOTAL LIABILITIES	13,695	13,914
Commitments and contingencies (Note 12)
Redeemable noncontrolling interests (Note 14)	13	11
Praxair, Inc. Shareholders’ Equity:
Common stock $0.01 par value, authorized - 800,000,000 shares, issued 2018 and 2017 - 383,230,625 shares	4	4
Additional paid-in capital	4,049	4,084
Retained earnings	13,447	13,224
Accumulated other comprehensive income (loss) (Note 14)	(3,980)	(4,098)
Less: Treasury stock, at cost (2018 - 95,861,142 shares and 2017 - 96,453,634 shares)	(7,152)	(7,196)
Total Praxair, Inc. Shareholders’ Equity	6,368	6,018
Noncontrolling interests	516	493
TOTAL EQUITY	6,884	6,511
TOTAL LIABILITIES AND EQUITY	$ 20,592	$ 20,436

XML

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Property, plant and equipment, accumulated depreciation	$ 14,103	$ 13,819
Common stock, par value (usd per share)	$ 0.01	$ 0.01
Common stock, authorized (in shares)	800,000,000	800,000,000
Common stock, issued (in shares)	383,230,625	383,230,625
Treasury stock, shares (in shares)	95,861,142	96,453,634

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
OPERATIONS
Net income - Praxair, Inc.	$ 462	$ 389
Income (Loss) Attributable to Noncontrolling Interest, before Tax	(10)	(15)
Net income (including noncontrolling interests)	472	404
Adjustments to reconcile net income to net cash provided by operating activities:
Transaction costs and other charges, net of payments	14	6
Depreciation and amortization	311	287
Deferred income taxes	11	22
Share-based compensation	4	12
Accounts receivable	(82)	(49)
Inventory	(2)	(2)
Prepaid and other current assets	(19)	(13)
Payables and accruals	(67)	(42)
Pension contributions	(4)	(3)
Long-term assets, liabilities and other	50	88
Net Cash Provided by (Used in) Operating Activities, Continuing Operations	688	710
INVESTING
Capital expenditures	(325)	(327)
Acquisitions, net of cash acquired	0	(1)
Divestitures and Asset Sales	7	4
Net Cash Provided by (Used in) Investing Activities, Continuing Operations	(318)	(324)
FINANCING
Short-term debt borrowings (repayments) - net	288	(24)
Long-term debt borrowings		7
Long-term debt repayments	(503)	(156)
Issuances of common stock	29	26
Purchases of common stock		(11)
Cash dividends - Praxair, Inc. shareholders	(237)	(225)
Noncontrolling interest transactions and other	(6)	(13)
Net Cash Provided by (Used in) Financing Activities, Continuing Operations	(429)	(396)
Effect of exchange rate changes on cash and cash equivalents	(13)	5
Change in cash and cash equivalents	(72)	(5)
Cash and cash equivalents, beginning-of-period	617	524
Cash and cash equivalents, end-of-period	$ 545	$ 519

XML

Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2018

Accounting Policies [Abstract]

Summary Of Significant Accounting Policies

Summary of Significant Accounting Policies

Presentation of Condensed Consolidated Financial Statements- In the opinion of Praxair, Inc. (Praxair) management, the accompanying condensed consolidated financial statements include all adjustments necessary for a fair presentation of the results for the interim periods presented and such adjustments are of a normal recurring nature. The accompanying condensed consolidated financial statements should be read in conjunction with the notes to the consolidated financial statements of Praxair, Inc. and subsidiaries in Praxair’s 2017 Annual Report on Form 10-K. There have been no material changes to the company’s significant accounting policies during 2018.

Accounting Standards Implemented in 2018

• Revenue Recognition – In May 2014, the FASB issued updated guidance on the reporting and disclosure of revenue. Effective January 1, 2018, Praxair has adopted this guidance using the modified retrospective transition method. No material differences in revenue recognition accounting were identified under the new guidance compared with the Company's historic revenue recognition accounting (see Note 15).

• Classification of Certain Cash Receipts and Cash Payments – In August 2016, the FASB issued updated guidance on the classification of certain cash receipts and cash payments within the statement of cash flows. The update provides accounting guidance for specific cash flow issues with the objective of reducing diversity in practice. The adoption of this guidance did not have a material impact on the financial statements.

• Intra-Entity Asset Transfers – In October 2016, the FASB issued updated guidance for income tax accounting of intra-entity transfers of assets other than inventory. The update requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory in the period when the transfer occurs. The adoption of this guidance did not have a material impact on the financial statements.

• Pension Costs - In March 2017, the FASB issued updated guidance on the presentation of net periodic pension cost and net periodic postretirement benefit cost. The new guidance requires the service cost component be reported in the same line item or items as other compensation costs arising from services rendered by employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and not included within operating profit. This guidance was adopted in the first quarter 2018. Accordingly, non-service related components of net periodic pension and postretirement benefit costs were reclassified out of "Operating Profit" to "Net pension and OPEB cost (benefit), excluding service cost" using the practical expedient to use the amounts disclosed in the retirement benefits note for the prior comparative periods as the estimation basis for applying the retrospective presentation requirements (see Note 11).

Accounting Standards to be Implemented

• Leases – In February 2016, the FASB issued updated guidance on the accounting and financial statement presentation of leases. The new guidance requires lessees to recognize a right-of-use asset and lease liability for all leases, except those that meet certain scope exceptions, and would require expanded quantitative and qualitative disclosures. This guidance will be effective for Praxair beginning in the first quarter 2019 and requires companies to transition using a modified retrospective approach. Praxair is in the process of implementing the new guidance and will provide updates on the expected impact to Praxair in future filings, as appropriate.

• Credit Losses on Financial Instruments –In June 2016, the FASB issued an update on the measurement of credit losses. The guidance introduces a new accounting model for expected credit losses on financial instruments, including trade receivables, based on estimates of current expected credit losses. This guidance will be effective for Praxair beginning in the first quarter 2020, with early adoption permitted beginning in the first quarter 2019 and requires companies to apply the change in accounting on a prospective basis. We are currently evaluating the impact this update will have on our consolidated financial statements.

• Simplifying the Test for Goodwill Impairment – In January 2017, the FASB issued updated guidance on the measurement of goodwill. The new guidance eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge. The guidance will be effective for Praxair beginning in the first quarter 2020. Praxair does not expect this guidance to have a material impact.

• Derivatives and Hedging - In August 2017, the FASB issued updated guidance on accounting for hedging activities. The new guidance changes both the designation and measurement for qualifying hedging relationships and the presentation of hedge results. This guidance will be effective for Praxair beginning in the first quarter 2019, with early adoption optional. Praxair is currently evaluating the impact this update will have on our consolidated financial statements.

• Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income – In February 2018, the FASB issued updated guidance which allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. This new guidance will be effective for Praxair beginning in the first quarter 2019 on a retrospective basis, with early adoption optional. Praxair is currently assessing the impact and timing of adoption.

Reclassifications – Certain prior years’ amounts have been reclassified to conform to the current year’s presentation including reclassifications on the consolidated statements of income and segment operating profit relating to the adoption of accounting guidance on the presentation of net periodic pension and postretirement benefit costs.

XML

Transaction Costs and Other Charges

3 Months Ended

Mar. 31, 2018

Unusual or Infrequent Items, or Both [Abstract]

Transaction Costs and Other Charges

Transaction Costs and Other Charges

On June 1, 2017 Praxair and Linde AG ("Linde") entered into a business combination agreement, pursuant to which they agreed to combine their respective businesses subject to shareholder and regulatory approvals (see Note 17). In the first quarters of 2018 and 2017, Praxair incurred transaction costs and other charges primarily in connection with the intended business combination totaling $19 million ($18 million after-tax and noncontrolling interests or $0.06 per diluted share) and $6 million after-tax ($0.02 per diluted share), respectively.

Classification in the condensed consolidated financial statements

The costs are shown within operating profit in a separate line item on the consolidated statements of income. On the condensed consolidated statement of cash flows, the impact of these costs, net of cash payments, is shown as an adjustment to reconcile net income to net cash provided by operating activities. In Note 13 - Segments, Praxair excluded these costs from its management definition of segment operating profit; a reconciliation of segments operating profit to consolidated operating profit is shown within the segment operating profit table.

XML

Acquisitions

3 Months Ended

Mar. 31, 2018

Business Combinations [Abstract]

Acquisitions

Acquisitions

Acquisition activity was immaterial in both the first quarter of 2018 and 2017.

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Supplemental Information

3 Months Ended

Mar. 31, 2018

Supplemental Information [Abstract]

Supplemental Information

Supplemental Information

Inventories

The following is a summary of Praxair’s consolidated inventories:

(Millions of dollars)	March 31, 2018		December 31, 2017
Inventories
Raw materials and supplies	$	223	$	224
Work in process	54		57
Finished goods	342		333
Total inventories	$	619	$	614

Long-term receivables

Long-term receivables are not material and are largely reserved. Such long-term receivables are included within other long-term assets in the condensed consolidated balance sheets and totaled $44 million and $54 million at March 31, 2018 and December 31, 2017, respectively. These amounts are net of reserves of $54 million and $51 million, respectively. The amounts in both periods relate primarily to government receivables in Brazil and other long-term notes receivable from customers. Collectability is reviewed regularly and uncollectible amounts are written off as appropriate.

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Debt

3 Months Ended

Mar. 31, 2018

Debt Disclosure [Abstract]

Debt

Debt

The following is a summary of Praxair’s outstanding debt at March 31, 2018 and December 31, 2017:

(Millions of dollars)	March 31, 2018			December 31, 2017
SHORT-TERM
Commercial paper and U.S. bank borrowings	$	492		$	202
Other bank borrowings (primarily international)	35			36
Total short-term debt	527			238
LONG-TERM (a)
U.S. borrowings (U.S. dollar denominated unless otherwise noted)
1.20% Notes due 2018 (b)	—			498
1.25% Notes due 2018 (c)	474			475
4.50% Notes due 2019	599			599
1.90% Notes due 2019	500			500
1.50% Euro-denominated notes due 2020	737			717
2.25% Notes due 2020	299			299
4.05% Notes due 2021	498			498
3.00% Notes due 2021	497			497
2.45% Notes due 2022	598			598
2.20% Notes due 2022	498			498
2.70% Notes due 2023	498			498
1.20% Euro-denominated notes due 2024	675			658
2.65% Notes due 2025	397			397
1.625% Euro-denominated notes due 2025	610			594
3.20% Notes due 2026	725			725
3.55% Notes due 2042	662			662
Other	9			12
International bank borrowings	35			33
Obligations under capital leases	4			4
	8,315			8,762
Less: current portion of long-term debt	(979		)	(979		)
Total long-term debt	7,336			7,783
Total debt	$	8,842		$	9,000

(a) Amounts are net of unamortized discounts, premiums and/or debt issuance costs as applicable.

(b) In March 2018, Praxair repaid $500 million of 1.20% notes that became due.

(c) March 31, 2018 and December 31, 2017 include a $1 million fair value decrease and a less than $1 million increase, respectively, related to hedge accounting. See Note 6 for additional information.

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Financial Instruments

3 Months Ended

Mar. 31, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Financial Instruments

Financial Instruments

In its normal operations, Praxair is exposed to market risks relating to fluctuations in interest rates, foreign currency exchange rates, energy costs and to a lesser extent precious metal prices. The objective of financial risk management at Praxair is to minimize the negative impact of such fluctuations on the company’s earnings and cash flows. To manage these risks, among other strategies, Praxair routinely enters into various derivative financial instruments (“derivatives”) including interest-rate swap and treasury rate lock agreements, currency-swap agreements, forward contracts, currency options, and commodity-swap agreements. These instruments are not entered into for trading purposes and Praxair only uses commonly traded and non-leveraged instruments.

There are three types of derivatives that the company enters into: (i) those relating to fair-value exposures, (ii) those relating to cash-flow exposures, and (iii) those relating to foreign currency net investment exposures. Fair-value exposures relate to recognized assets or liabilities, and firm commitments; cash-flow exposures relate to the variability of future cash flows associated with recognized assets or liabilities, or forecasted transactions; and net investment exposures relate to the impact of foreign currency exchange rate changes on the carrying value of net assets denominated in foreign currencies.

When a derivative is executed and hedge accounting is appropriate, it is designated as either a fair-value hedge, cash-flow hedge, or a net investment hedge. Currently, Praxair designates all interest-rate and treasury-rate locks as hedges for accounting purposes; however, currency contracts are generally not designated as hedges for accounting purposes unless they are related to forecasted transactions. Whether designated as hedges for accounting purposes or not, all derivatives are linked to an appropriate underlying exposure. On an ongoing basis, the company assesses the hedge effectiveness of all derivatives designated as hedges for accounting purposes to determine if they continue to be highly effective in offsetting changes in fair values or cash flows of the underlying hedged items. If it is determined that the hedge is not highly effective, then hedge accounting will be discontinued prospectively.

Counterparties to Praxair’s derivatives are major banking institutions with credit ratings of investment grade or better and no collateral is required, and there are no significant risk concentrations. Management believes the risk of incurring losses on derivative contracts related to credit risk is remote and any losses would be immaterial.

The following table is a summary of the notional amount and fair value of derivatives outstanding at March 31, 2018 and December 31, 2017 for consolidated subsidiaries:

					Fair Value
	Notional Amounts				Assets				Liabilities
(Millions of dollars)	March 31, 2018		December 31, 2017		March 31, 2018		December 31, 2017		March 31, 2018		December 31, 2017
Derivatives Not Designated as Hedging Instruments:
Currency contracts:
Balance sheet items (a)	$	2,288	$	2,693	$	12	$	16	$	5	$	16
Derivatives Designated as Hedging Instruments:
Currency contracts:
Balance sheet items (a)	$	—	$	38	$	—	$	—	$	—	$	2
Forecasted purchases (a)	5		4		—		1		—		—
Interest rate contracts:
Interest rate swaps (a)	475		475		—		—		1		—
Total Hedges	$	480	$	517	$	—	$	1	$	1	$	2
Total Derivatives	$	2,768	$	3,210	$	12	$	17	$	6	$	18

(a) Assets are recorded in prepaid and other current assets, and liabilities are recorded in other current liabilities.

Currency Contracts

Balance Sheet Items

Foreign currency contracts related to balance sheet items consist of forward contracts entered into to manage the exposure to fluctuations in foreign-currency exchange rates on recorded balance sheet assets and liabilities denominated in currencies other than the functional currency of the related operating unit. Certain forward currency contracts are entered into to protect underlying monetary assets and liabilities denominated in foreign currencies from foreign exchange risk and are not designated as hedging instruments. The fair value adjustments on these contracts are offset by the fair value adjustments recorded on the underlying monetary assets and liabilities. Praxair also enters into forward currency contracts, which are designated as hedging instruments, to limit the cash flow exposure on certain foreign-currency denominated intercompany loans. The fair value adjustments on these contracts are recorded to AOCI, with the effective portion immediately reclassified to earnings to offset the fair value adjustments on the underlying debt instrument.

Forecasted Purchases

Foreign currency contracts related to forecasted purchases consist of forward contracts entered into to manage the exposure to fluctuations in foreign-currency exchange rates on forecasted purchases of capital-related equipment and services denominated in currencies other than the functional currency of the related operating units. These forward contracts were designated and accounted for as cash flow hedges.

Net Investment Hedge

In 2014 Praxair designated the €600 million ($737 million as of March 31, 2018) 1.50% Euro-denominated notes due 2020 and the €500 million ($610 million as of March 31, 2018) 1.625% Euro-denominated notes due 2025, as a hedge of the net investment position in its European operations. In 2016 Praxair designated an incremental €550 million ($675 million as of March 31, 2018) 1.20% Euro-denominated notes due 2024 as an additional hedge of the net investment position in its European operations. On December 22, 2017, the U.S. government enacted the Tax Cuts and Jobs Act. In response to the decrease in the tax rate from 35% to 21%, as of March 31, 2018 the Company has de-designated €130 million of its Euro-denominated notes, which were previously designated as a hedge of the net investment position in its European operations. These Euro-denominated debt instruments reduce the company's exposure to changes in the currency exchange rate on investments in foreign subsidiaries with Euro functional currencies. Since hedge inception, exchange rate movements have reduced long-term debt by $51 million (long-term debt increased by $46 million during the first quarter of 2018), with the offsetting gain shown within the cumulative translation component of AOCI in the condensed consolidated balance sheets and the consolidated statements of comprehensive income.

Interest Rate Contracts

Outstanding Interest Rate Swaps

At March 31, 2018, Praxair had one outstanding interest rate swap agreement with a $475 million notional amount related to the $475 million1.25% notes that mature in 2018. The interest rate swap effectively converts fixed-rate interest to variable-rate interest and is designated as a fair value hedge. Fair value adjustments are recognized in earnings along with an equally offsetting charge / benefit to earnings for the changes in the fair value of the underlying debt instrument. At March 31, 2018, $1 million was recognized as a decrease in the fair value of these notes (increase in the fair value of less than $1 million at December 31, 2017).

Terminated Treasury Rate Locks

The following table summarizes the unrecognized gains (losses) related to terminated treasury rate lock contracts:

	Year Terminated	Original Gain / (Loss)			Unrecognized Gain / (Loss) (a)
(Millions of dollars)					March 31, 2018			December 31, 2017
Treasury Rate Locks
Underlying debt instrument:
$500 million 2.20% fixed-rate notes that mature in 2022 (b)	2012	$	(2	)	$	(1	)	$	(1	)
$500 million 3.00% fixed-rate notes that mature in 2021 (b)	2011	(11		)	(4		)	(4		)
$600 million 4.50% fixed-rate notes that mature in 2019 (b)	2009	16			3			3
Total - pre-tax					$	(2	)	$	(2	)
Less: income taxes					1			1
After- tax amounts					$	(1	)	$	(1	)

(a) The unrecognized gains / (losses) for the treasury rate locks are shown in accumulated other comprehensive income (“AOCI”) and are being recognized on a straight line basis to interest expense – net over the term of the underlying debt agreements. Refer to the table below summarizing the impact on the company’s consolidated statements of income and AOCI for current period gain (loss) recognition.

(b) The notional amount of the treasury rate lock contracts are equal to the underlying debt instrument with the exception of the treasury rate lock contract entered into to hedge the $600 million4.50% fixed-rate notes that mature in 2019. The notional amount of this contract was $500 million.

The following table summarizes the impact of the company’s derivatives on the consolidated statements of income:

	Amount of Pre-Tax Gain (Loss) Recognized in Earnings *
	Quarter Ended March 31,
(Millions of dollars)	2018		2017
Derivatives Not Designated as Hedging Instruments
Currency contracts:
Balance sheet items
Debt-related	$	36	$	79
Other balance sheet items	2		1
Total	$	38	$	80

* The gains (losses) on balance sheet items are offset by gains (losses) recorded on the underlying hedged assets and liabilities. Accordingly, the gains (losses) for the derivatives and the underlying hedged assets and liabilities related to debt items are recorded in the consolidated statements of income as interest expense-net. Other balance sheet items and anticipated net income gains (losses) are recorded in the consolidated statements of income as other income (expenses)-net.

The following table summarizes the impacts of the company's derivatives designated as hedging instruments that impact AOCI:

Derivatives Designated as Hedging Instruments **

	Quarter Ended
	Amount of Gain  (Loss) Recognized in AOCI					Amount of Gain  (Loss) Reclassified from AOCI to the Consolidated Statement of Income
(Millions of dollars)	March 31, 2018		March 31, 2017			March 31, 2018		March 31, 2017
Currency contracts:
Balance sheet items	$	—	$	(1	)	$	—	$	—
Net investment hedge	—		—			—		—
Forecasted purchases	—		—			—		—
Interest rate contracts:
Treasury rate lock contracts	—		—			—		—
Total - pre tax	$	—	$	(1	)	$	—	$	—
Less: income taxes	—		1			—		—
Total - Net of Taxes	$	—	$	—		$	—	$	—

**The gains (losses) on net investment hedges are recorded as a component of AOCI within foreign currency translation adjustments in the condensed consolidated balance sheets and the condensed consolidated statements of comprehensive income. The gains (losses) on treasury rate locks are recorded as a component of AOCI within derivative instruments in the condensed consolidated balance sheets and the condensed consolidated statements of comprehensive income. There was no ineffectiveness for these instruments during 2018 or 2017. The gains (losses) on net investment hedges are reclassified to earnings only when the related currency translation adjustments are required to be reclassified, usually upon sale or liquidation of the investment. The gains (losses) for interest rate contracts are reclassified to earnings as interest expense –net on a straight-line basis over the remaining maturity of the underlying debt. Net losses of less than $1 million are expected to be reclassified to earnings during the next twelve months.

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Fair Value Disclosures

3 Months Ended

Mar. 31, 2018

Fair Value Disclosures [Abstract]

Fair Value Disclosures

Fair Value Disclosures

The fair value hierarchy prioritizes the input to valuation techniques used to measure fair value into three broad levels as follows:

Level 1 – quoted prices in active markets for identical assets or liabilities

Level 2 – quoted prices for similar assets and liabilities in active markets or inputs that are observable

Level 3 – inputs that are unobservable (for example cash flow modeling inputs based on assumptions)

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table summarizes assets and liabilities measured at fair value on a recurring basis:

	Fair Value Measurements Using
	Level 1		Level 2				Level 3
(Millions of dollars)	March 31, 2018	December 31, 2017	March 31, 2018		December 31, 2017		March 31, 2018	December 31, 2017
Assets
Derivatives	—	—	$	12	$	17	—	—
Liabilities
Derivatives	—	—	$	6	$	18	—	—

The fair values of the derivative assets and liabilities are based on market prices obtained from independent brokers or determined using quantitative models that use as their basis readily observable market parameters that are actively quoted and can be validated through external sources, including third-party pricing services, brokers and market transactions. Investments are marketable securities traded on an exchange.

The fair values of cash and cash equivalents, short-term debt, accounts receivable-net, and accounts payable approximate carrying amounts because of the short maturities of these instruments. The fair value of long-term debt is estimated based on the quoted market prices for similar issues, which is deemed a level 2 measurement. At March 31, 2018, the estimated fair value of Praxair’s long-term debt portfolio was $8,380 million versus a carrying value of $8,315 million. At December 31, 2017, the estimated fair value of Praxair’s long-term debt portfolio was $8,969 million versus a carrying value of $8,762 million. Differences from carrying amounts are attributable to interest-rate changes subsequent to when the debt was issued.

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Earnings Per Share - Praxair, Inc. Shareholders

3 Months Ended

Mar. 31, 2018

Earnings Per Share [Abstract]

Earnings Per Share - Praxair, Inc. Shareholders

Earnings Per Share – Praxair, Inc. Shareholders

Basic earnings per share is computed by dividing Net income – Praxair, Inc. for the period by the weighted average number of Praxair common shares outstanding. Diluted earnings per share is computed by dividing Net income – Praxair, Inc. for the period by the weighted average number of Praxair common shares outstanding and dilutive common stock equivalents, as follows:

	Quarter Ended March 31,
	2018		2017
Numerator (Millions of dollars)
Net income - Praxair, Inc.	$	462	$	389
Denominator (Thousands of shares)
Weighted average shares outstanding	287,175		285,140
Shares earned and issuable under compensation plans	329		369
Weighted average shares used in basic earnings per share	287,504		285,509
Effect of dilutive securities
Stock options and awards	3,305		1,875
Weighted average shares used in diluted earnings per share	290,809		287,384
Basic Earnings Per Share	$	1.61	$	1.36
Diluted Earnings Per Share	$	1.59	$	1.35

There were no antidilutive shares for the quarter ended March 31, 2018. Stock options of 4,673,805 were antidilutive and therefore excluded in the computation of diluted earnings per share for the quarter ended March 31, 2017.

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Goodwill and Other Intangible Assets (Notes)

3 Months Ended

Mar. 31, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

Changes in the carrying amount of goodwill for the three months ended March 31, 2018 were as follows:

(Millions of dollars)	North America		South America			Europe		Asia		Surface Technologies		Total
Balance, December 31, 2017	$	2,202	$	129		$	698	$	61	$	143	$	3,233
Acquisitions	—		—			—		—		—		—
Purchase adjustments & other	12		—			—		—		—		12
Foreign currency translation	3		(1		)	23		2		2		29
Balance, March 31, 2018	$	2,217	$	128		$	721	$	63	$	145	$	3,274

Praxair has performed its goodwill impairment tests annually during the second quarter of each year, and historically has determined that the fair value of each of its reporting units was substantially in excess of its carrying value (refer to Note 1 to the consolidated financial statements of Praxair's 2017 Annual Report on Form 10-K). As a result, no impairment was recorded. There were no indicators of impairment through March 31, 2018.

Changes in the carrying amounts of other intangibles for the three months ended March 31, 2018 were as follows:

(Millions of dollars)	Customer & License/Use Agreements			Non-compete Agreements			Patents & Other			Total
Cost:
Balance, December 31, 2017	$	772		$	28		$	52		$	852
Additions	—			—			—			—
Foreign currency translation	8			—			—			8
Other*	(19		)	(5		)	—			(24		)
Balance, March 31, 2018	$	761		$	23		$	52		$	836
Less: Accumulated amortization
Balance, December 31, 2017	$	(260	)	$	(18	)	$	(21	)	$	(299	)
Amortization expense	(9		)	(1		)	(1		)	(11		)
Foreign currency translation	(3		)	—			—			(3		)
Other*	19			5			—			24
Balance, March 31, 2018	$	(253	)	$	(14	)	$	(22	)	$	(289	)
Net balance at March 31, 2018	$	508		$	9		$	30		$	547

* Other primarily relates to the write-off of fully amortized assets.

There are no expected residual values related to these intangible assets. The remaining weighted-average amortization period for intangible assets is approximately 16 years.

Total estimated annual amortization expense is as follows:

(Millions of dollars)
Remaining 2018	$	33
2019	44
2020	42
2021	40
2022	39
Thereafter	349
	$	547

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Share-Based Compensation

3 Months Ended

Mar. 31, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-Based Compensation

Share-Based Compensation

Share-based compensation expense of $4 million (benefit of $10 million after-tax) and $12 million ($4 million after-tax) was recognized during the quarters ended March 31, 2018 and 2017, respectively. The 2018 and 2017 quarters include $13 million and $4 million of excess tax benefits, respectively. The expense was recorded primarily in selling, general and administrative expenses. There was no share-based compensation cost that was capitalized. For further details regarding Praxair’s share-based compensation arrangements and prior-year grants, refer to Note 15 to the consolidated financial statements of Praxair’s 2017 Annual Report on Form 10-K.

Stock Options

The weighted-average fair value of options granted during the three months ended March 31, 2018 was $19.29 ($12.40 in 2017) based on the Black-Scholes Options-Pricing model. The increase in grant date fair value year-over-year was primarily attributable to an increase in the company's stock price.

The following weighted-average assumptions were used to value the grants in 2018 and 2017:

	Three months ended March 31,
	2018		2017
Dividend yield	2.1	%	2.7	%
Volatility	14.4	%	14.0	%
Risk-free interest rate	2.67	%	2.13	%
Expected term years	5		6

The following table summarizes option activity under the plans as of March 31, 2018 and changes during the three-month period then ended (averages are calculated on a weighted basis; life in years; intrinsic value expressed in millions):

	Number of Options  (000’s)		Average Exercise Price		Average Remaining Life	Aggregate Intrinsic Value
Outstanding at January 1, 2018	10,787		$	108.70
Granted	1,625		154.00
Exercised	(901	)	90.70
Cancelled or Expired	(16	)	115.09
Outstanding at March 31, 2018	11,495		116.50		6.7	$	335
Exercisable at March 31, 2018	7,755		$	109.67	5.5	$	269

The aggregate intrinsic value represents the difference between the company’s closing stock price of $144.30 as of March 31, 2018 and the exercise price multiplied by the number of in the money options outstanding as of that date. The total intrinsic value of stock options exercised during the quarter ended March 31, 2018 was $63 million ($18 million during the same period in 2017).

Cash received from option exercises under all share-based payment arrangements for the quarter ended March 31, 2018 was $78 million ($19 million for the same period in 2017). The cash tax benefit realized from share-based compensation totaled $14 million for the quarter ended March 31, 2018 ($8 million for the same period in 2017).

As of March 31, 2018, $40 million of unrecognized compensation cost related to non-vested stock options is expected to be recognized over a weighted-average period of approximately 1 year.

Performance-Based and Restricted Stock Awards

During the three months endedMarch 31, 2018, the company granted restricted stock units to employees of 269,433 shares. There were no performance-based stock awards granted to employees during the three months endedMarch 31, 2018 as restricted stock units were granted in place of performance-based stock awards. Compensation expense related to the restricted stock units is recognized over the vesting period, which is up to three years, based on the grant date fair value.

As of March 31, 2018 the company had performance-based stock awards outstanding, tied to either return on capital ("ROC") performance or relative total shareholder return ("TSR") performance versus that of the S&P 500. The actual number of shares issued in settlement of a vested award can range from zero to 200 percent of the target number of shares granted based upon the company’s attainment of specified performance targets at the end of a three-year period. Compensation expense related to these awards is recognized over the three-year performance period based on the fair value of the closing market price of the company’s common stock on the date of the grant and the estimated performance that will be achieved. Compensation expense for ROC awards will be adjusted during the three-year performance period based upon the estimated performance levels that will be achieved. TSR awards are measured at their grant date fair value and not subsequently re-measured.

The weighted-average fair value of restricted stock units granted during the three months endedMarch 31, 2018 was $144.79 ($109.64 for the same period in 2017). These fair values are based on the closing market price of Praxair’s common stock on the grant date adjusted for dividends that will not be paid during the vesting period. The weighted-average fair value of ROC performance-based stock awards granted during the three months ended March 31, 2017 was 109.68.

The weighted-average fair value of performance-based stock tied to relative TSR performance granted during three months ended March 31, 2017 was $124.12 and was estimated using a Monte Carlo simulation performed as of the grant date.

The following table summarizes non-vested performance-based and restricted stock award activity as of March 31, 2018 and changes during the three months then ended (shares based on target amounts, averages are calculated on a weighted basis):

	Performance-Based				Restricted Stock
	Number  of Shares (000’s)		Average Grant  Date Fair Value		Number  of Shares (000’s)		Average Grant  Date Fair Value
Non-vested at January 1, 2018	665		$	113.40	264		$	107.56
Granted	—		—		269		144.79
Vested	(78	)	120.04		(65	)	119.87
Cancelled and Forfeited	(147	)	111.63		(1	)	116.19
Non-vested at March 31, 2018	440		$	110.02	467		$	127.32

There are approximately 6 thousand performance-based shares and 3 thousand restricted stock shares that are non-vested at March 31, 2018 which will be settled in cash due to foreign regulatory limitations. The liability related to these grants reflects the current estimate of performance that will be achieved and the current common stock price.

As of March 31, 2018, based on current estimates of future performance, $13 million of unrecognized compensation cost related to performance-based awards is expected to be recognized through the first quarter of 2020 and $43 million of unrecognized compensation cost related to the restricted stock awards is expected to be recognized primarily through the first quarter of 2021.

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Retirement Programs

3 Months Ended

Mar. 31, 2018

Retirement Benefits, Description [Abstract]

Retirement Programs

Retirement Programs

The components of net pension and postretirement benefits other than pensions (“OPEB”) costs for the quarters ended March 31, 2018 and 2017 are shown below:

	Quarter Ended March 31,
	Pensions						OPEB
(Millions of dollars)	2018			2017			2018			2017
Amount recognized in Operating Profit
Service cost	$	12		$	11		$	—		$	1
Amount recognized in Net pension and OPEB cost (benefit), excluding service cost
Interest cost	26			26			1			1
Expected return on plan assets	(42		)	(40		)	—			—
Net amortization and deferral	18			17			(1		)	(1		)
Curtailment gain (a)	—			—			—			(18		)
	$	2		$	3		$	—		$	(18	)
Net periodic benefit cost (benefit)	$	14		$	14		$	—		$	(17	)

(a) The curtailment gain recorded in the first quarter of 2017 resulted from the termination of an OPEB plan in South America.

Praxair estimates that 2018 required contributions to its pension plans will be in the range of $15 million to $20 million, of which $4 million have been made through March 31, 2018.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments And Contingencies

Commitments and Contingencies

Contingent Liabilities

Praxair is subject to various lawsuits and government investigations that arise from time to time in the ordinary course of business. These actions are based upon alleged environmental, tax, antitrust and personal injury claims, among others. Praxair has strong defenses in these cases and intends to defend itself vigorously. It is possible that the company may incur losses in connection with some of these actions in excess of accrued liabilities. Management does not anticipate that in the aggregate such losses would have a material adverse effect on the company’s consolidated financial position or liquidity; however, it is possible that the final outcomes could have a significant impact on the company’s reported results of operations in any given period (see Note 17 to the consolidated financial statements of Praxair’s 2017 Annual Report on Form 10-K).

Significant matters are:

• During May 2009, the Brazilian government published Law 11941/2009 instituting a new voluntary amnesty program (“Refis Program”) which allowed Brazilian companies to settle certain federal tax disputes at reduced amounts. During the 2009 third quarter, Praxair decided that it was economically beneficial to settle many of its outstanding federal tax disputes and such disputes were enrolled in the Refis Program, subject to final calculation and review by the Brazilian federal government. The Company recorded estimated liabilities based on the terms of the Refis Program. Since 2009, Praxair has been unable to reach final agreement on the calculations and initiated litigation against the government in an attempt to resolve certain items. Open issues relate to the following matters: (i) application of cash deposits and net operating loss carryforwards to satisfy obligations, and (ii) the amount of tax reductions available under the Refis Program. It is difficult to estimate the timing of resolution of legal matters in Brazil.

• At March 31, 2018 the most significant non-income and income tax claims in Brazil, after enrollment in the Refis Program, relate to state VAT tax matters and a federal income tax matter where the taxing authorities are challenging the tax rate that should be applied to income generated by a subsidiary company. The total estimated exposure relating to such claims, including interest and penalties, as appropriate, is approximately $240 million. Praxair has not recorded any liabilities related to such claims based on management judgments, after considering judgments and opinions of outside counsel. Because litigation in Brazil historically takes many years to resolve, it is very difficult to estimate the timing of resolution of these matters; however, it is possible that certain of these matters may be resolved within the near term. The company is vigorously defending against the proceedings.

• On September 1, 2010, CADE (Brazilian Administrative Council for Economic Defense) announced alleged anticompetitive activity on the part of five industrial gas companies in Brazil and imposed fines on all five companies. Originally, CADE imposed a civil fine of R$2.2 billion Brazilian reais (US$662 million) against White Martins, the Brazil-based subsidiary of Praxair, Inc. In response to a motion for clarification, the fine was reduced to R$1.7 billion Brazilian reais (US$511 million) due to a calculation error made by CADE. The amount of the fine is subject to indexation using SELIC. On September 2, 2010, Praxair issued a press release and filed a report on Form 8-K rejecting all claims and stating that the fine represents a gross and arbitrary disregard of Brazilian law.

On October 19, 2010, White Martins filed an annulment petition (“appeal”) with the Federal Court in Brasilia seeking to have the fine against White Martins entirely overturned. In order to suspend payment of the fine pending the completion of the appeal process, Brazilian law required that the company tender a form of guarantee in the amount of the fine as security. Initially, 50% of the guarantee was satisfied by letters of credit with a financial institution and 50% by equity of a Brazilian subsidiary. On April 15, 2016, the Ninth Federal Court in Brasilia allowed White Martins to withdraw and cancel the letters of credit. Accordingly, the guarantee is currently satisfied solely by equity of a Brazilian subsidiary.

On September 14, 2015, the Ninth Federal Court of Brasilia overturned the fine against White Martins and declared the original CADE administrative proceeding to be null and void. On June 30, 2016, CADE filed an appeal against this decision with the Federal Circuit Court in Brasilia.

Praxair strongly believes that the allegations are without merit and that the fine will be entirely overturned during the appeal process. The company further believes that it has strong defenses and will vigorously defend against the allegations and related fine up to such levels of the Federal Courts in Brazil as may be necessary. Because appeals in Brazil historically take many years to resolve, it is very difficult to estimate when the appeal will be finally decided. Based on management judgments, after considering judgments and opinions of outside counsel, no reserve has been recorded for this proceeding as management does not believe that a loss is probable.

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Segments

3 Months Ended

Mar. 31, 2018

Segment Reporting [Abstract]

Segments

Segments

For a description of Praxair’s operating segments, refer to Note 18 to the consolidated financial statements of Praxair’s 2017 Annual Report on Form 10-K.

Sales and operating profit by segment for the quarters ended March 31, 2018 and 2017 are shown below. 2017 segment operating profit has been reclassified to conform with current year presentation as a result of the adoption of new accounting guidance on the presentation of net periodic pension and postretirement benefit costs (see Note 1).

	Quarter Ended March 31,
(Millions of dollars)	2018		2017
SALES(a)
North America	$	1,563	$	1,458
Europe	428		356
South America	365		369
Asia	476		395
Surface Technologies	167		150
Total sales	$	2,999	$	2,728

	Quarter Ended March 31,
(Millions of dollars)	2018			2017
OPERATING PROFIT
North America	$	406		$	357
Europe	80			67
South America	54			48
Asia	104			75
Surface Technologies	28			26
Segment operating profit	672			573
Transaction costs and other charges (Note 2)	(19		)	(6		)
Total operating profit	$	653		$	567

(a) Sales reflect external sales only. Intersegment sales, primarily from North America to other segments, were not material.

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Equity and Redeemable Noncontrolling Interests

3 Months Ended

Mar. 31, 2018

Equity And Noncontrolling Interests Disclosure [Abstract]

Equity and Redeemable Noncontrolling Interests

Equity and Redeemable Noncontrolling Interests

Equity

A summary of the changes in total equity for the quarters ended March 31, 2018 and 2017 is provided below:

	Quarter Ended March 31,
(Millions of dollars)	2018									2017
Activity	Praxair, Inc. Shareholders’ Equity			Noncontrolling Interests			Total Equity			Praxair, Inc. Shareholders’ Equity			Noncontrolling Interests			Total Equity
Balance, beginning of period	$	6,018		$	493		$	6,511		$	5,021		$	420		$	5,441
Net income (a)	462			9			471			389			15			404
Other comprehensive income (loss)	118			11			129			315			5			320
Noncontrolling interests:
Additions (reductions)	—			6			6			—			—			—
Dividends and other capital changes	—			(3		)	(3		)	—			(4		)	(4		)
Redemption value adjustments	(2		)	—			(2		)	—			—			—
Dividends to Praxair, Inc. common stock holders ($0.825 per share in 2018 and $0.7875 per share in 2017)	(237		)	—			(237		)	(225		)	—			(225		)
Issuances of common stock:
For the dividend reinvestment and stock purchase plan	2			—			2			2			—			2
For employee savings and incentive plans	3			—			3			15			—			15
Purchases of common stock	—			—			—			—			—			—
Share-based compensation	4			—			4			12			—			12
Balance, end of period	$	6,368		$	516		$	6,884		$	5,529		$	436		$	5,965

(a) Net income for noncontrolling interests excludes Net income related to redeemable noncontrolling interests of $1 million for three months ended March 31,2018 (net income was insignificant for the same time period in 2017) which is not part of total equity (see redeemable noncontrolling interests section below).

The components of AOCI are as follows:

	March 31,			December 31,
(Millions of dollars)	2018			2017
Cumulative translation adjustment - net of taxes:
North America	$	(853	)	$	(885	)
South America	(2,011		)	(2,004		)
Europe	(384		)	(398		)
Asia	(95		)	(151		)
Surface Technologies	(8		)	(17		)
	(3,351		)	(3,455		)
Derivatives - net of taxes	(1		)	(1		)
Pension / OPEB funded status obligation (net of $343 million and $347 million tax benefit in March 31, 2018 and December 31, 2017, respectively)	(628		)	(642		)
	$	(3,980	)	$	(4,098	)

Redeemable Noncontrolling Interests

Noncontrolling interests with redemption features, such as put/sell options, that are not solely within the Company’s control (“redeemable noncontrolling interests”) are reported separately in the consolidated balance sheets at the greater of carrying value or redemption value. For redeemable noncontrolling interests that are not yet exercisable, Praxair calculates the redemption value by accreting the carrying value to the redemption value over the period until exercisable. If the redemption value is greater than the carrying value, any increase is adjusted directly to equity and does not impact net income.

At March 31, 2018 and 2017, redeemable noncontrolling interests includes one packaged gas distributor in the United States where the noncontrolling shareholder has a put option.

Following is a summary of the changes in redeemable noncontrolling interests for the three months ended March 31, 2018 and 2017:

(Millions of dollars)	2018			2017
Balance, January 1	$	11		$	11
Net income	1			—
Distributions to noncontrolling interest and other	(1		)	(1		)
Redemption value adjustments/accretion	2			—
Balance, March 31	$	13		$	10

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Revenue Recognition (Notes)

3 Months Ended

Mar. 31, 2018

Revenue Recognition [Abstract]

Revenue Recognition

15. Revenue Recognition

Effective January 1, 2018, Praxair adopted the FASB's Accounting Standards Update No. 2014-09 ("ASC 606") relating to Revenue Recognition using the modified retrospective transition method. The new accounting standard requires revenue to be recognized as control of goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled to receive in exchange for the goods or services. No material differences in revenue recognition were identified as compared to the Company's historical revenue recognition accounting; accordingly, there is no adjustment to opening retained earnings at January 1, 2018 and therefore no need to present comparable revenue in accordance with the prior accounting policy. The following sections include updated accounting policies and disclosures required by ASC 606. Praxair's significant accounting policies for periods through December 31, 2017 are summarized in Note 1 to its 2017 Annual Report on Form 10-K.

Contracts with Customers

Approximately 94% of Praxair’s consolidated sales are generated from industrial gases and related products in four geographic segments (North America, Europe, South America and Asia) and the remaining 6% is related to the global surface technologies segment. Praxair serves a diverse group of industries including healthcare, petroleum refining, manufacturing, food, beverage carbonation, fiber-optics, steel making, aerospace, chemicals and water treatment.

Industrial Gases

Within each of the Company’s geographic segments for industrial gases, there are three basic distribution methods: (i) on-site or tonnage; (ii) merchant or bulk liquid; and (iii) packaged or cylinder gases. The distribution method used by Praxair to supply a customer is determined by many factors, including the customer’s volume requirements and location. The distribution method generally determines the contract terms with the customer and, accordingly, the revenue recognition accounting practices. Praxair’s primary products in its industrial gases business are atmospheric gases (oxygen, nitrogen, argon, rare gases) and process gases (carbon dioxide, helium, hydrogen, electronic gases, specialty gases, acetylene). These products are generally sold through one of the three distribution methods.

Following is a description of each of the three industrial gases distribution methods and the respective revenue recognition policies:

On-site. Customers that require the largest volumes of product and that have a relatively constant demand pattern are supplied by cryogenic and process gas on-site plants. Praxair constructs plants on or adjacent to these customers’ sites and supplies the product directly to customers by pipeline. Where there are large concentrations of customers, a single pipeline may be connected to several plants and customers. On-site product supply contracts generally are total requirement contracts with terms typically ranging from 10-20 years and contain minimum purchase requirements and price escalation provisions. Many of the cryogenic on-site plants also produce liquid products for the merchant market. Therefore, plants are typically not dedicated to a single customer. Additionally, Praxair is responsible for the design, construction, operations and maintenance of the plants and our customers typically have no involvement in these activities. Advanced air separation processes also allow on-site delivery to customers with smaller volume requirements.

The Company’s performance obligations related to on-site customers are satisfied over time as customers receive and obtain control of the product. Praxair has elected to apply the practical expedient for measuring progress towards the completion of a performance obligation and recognizes revenue as the company has the right to invoice each customer, which generally corresponds with product delivery. Accordingly, revenue is recognized when product is delivered to the customer and the Company has the right to invoice the customer in accordance with the contract terms. Consideration in these contracts is generally based on pricing which fluctuates with various price indices. Variable components of consideration exist within on-site contracts but are considered constrained.

Merchant. Merchant deliveries generally are made from Praxair’s plants by tanker trucks to storage containers at the customer's site. Due to the relatively high distribution cost, merchant oxygen and nitrogen generally have a relatively small distribution radius from the plants at which they are produced. Merchant argon, hydrogen and helium can be shipped much longer distances. The customer agreements used in the merchant business are usually three-to seven-year supply agreements based on the requirements of the customer. These contracts generally do not contain minimum purchase requirements or volume commitments.

The Company’s performance obligations related to merchant customers are generally satisfied at a point in time as the customers receive and obtain control of the product. Revenue is recognized when product is delivered to the customer and the Company has the right to invoice the customer in accordance with the contract terms. Any variable components of consideration within merchant contracts are constrained however this consideration is not significant.

Packaged Gases. Customers requiring small volumes are supplied products in containers called cylinders, under medium to high pressure. Praxair distributes merchant gases from its production plants to Company-owned cylinder filling plants where cylinders are then filled for distribution to customers. Cylinders may be delivered to the customer’s site or picked up by the customer at a packaging facility or retail store. Praxair invoices the customer for the industrial gases and the use of the cylinder container(s). The Company also sells hardgoods and welding equipment purchased from independent manufacturers. Packaged gases are generally sold under one to three-year supply contracts and purchase orders and do not contain minimum purchase requirements or volume commitments.

The Company’s performance obligations related to packaged gases are satisfied at a point in time. Accordingly, revenue is recognized when product is delivered to the customer or when the customer picks up product from a packaged gas facility or retail store, and the Company has the right to payment from the customer in accordance with the contract terms. Any variable consideration is constrained and will be recognized when the uncertainty related to the consideration is resolved.

Surface Technologies

The company’s surface technologies segment, operated through Praxair Surface Technologies, Inc., supplies wear-resistant and high-temperature corrosion-resistant metallic and ceramic coatings and powders. Praxair Surface Technologies is a leading global supplier of coatings services and thermal spray consumables to customers in the aircraft, energy, printing, primary metals, petrochemical, textile, and other industries. Its coatings are used to provide wear resistance, corrosion protection, thermal insulation, and many other surface-enhancing functions which serve to extend component life, enable optimal performance, and reduce operating costs. It also manufactures a complete line of electric arc, plasma and wire spray, and high-velocity oxy-fuel ("HVOF") equipment.

The Company’s performance obligation related to surface technologies customers are generally satisfied at a point in time when the customer receives and takes control of product. Accordingly, revenue is recognized when product is delivered to the customer or when the customer picks up the product from the Company’s facility, and the Company has the right to invoice the customer in accordance with the contract terms.

Payment Terms and Other

Praxair generally receives payment after performance obligations are satisfied, and customer prepayments are not typical. Payment terms vary based on the country where sales originate and local customary payment practices. Praxair does not offer extended financing outside of customary payment terms. Contract asset and liability balances and the changes in these balances are not material. Amounts billed for sales and use taxes, value-added taxes, and certain excise and other specific transactional taxes imposed on revenue producing transactions are presented on a net basis and are not included in sales within the consolidated statement of income. Additionally, sales returns and allowances are not a normal practice in the industry and are not significant.

Disaggregated Revenues Information

As described above and in Note 18 of the 2017 10-K, the Company manages its industrial gases business on a geographic basis, while the surface technologies business is managed on a global basis. Further, the Company believes that reporting sales by distribution method by reportable geographic segment best illustrates the nature, timing, type of customer, and contract terms for its revenues, including terms and pricing.

The following table shows sales by distribution method for each reportable segment and at the consolidated level for the quarter ended March 31, 2018.

(Dollars in Millions)			Industrial Gases
Sales	North America			Europe		South America		Asia		Surface Technologies		Total		%
Merchant	$	573		$	148	$	143	$	147	$	—	$	1,011	34	%
On-Site	460			80		114		246		—		900		30	%
Packaged Gas	493			181		98		54		—		826		27	%
Other	37			19		10		29		167		262		9	%
	$	1,563		$	428	$	365	$	476	$	167	$	2,999	100	%

Remaining Performance Obligations

As described above, Praxair’s contracts with on-site customers are under long-term supply arrangements which generally require the customer to purchase their requirements from Praxair and also have minimum purchase requirements. The Company estimates the consideration related to minimum purchase requirements is approximately $17 billion. This amount excludes all sales above minimum purchase requirements, which can be significant depending on customer needs. In the future, actual amounts will be different due to impacts from several factors, many of which are beyond the Company’s control including, but not limited to, timing of newly signed, terminated and renewed contracts, inflationary price escalations, currency exchange rates, and pass-through costs related to natural gas and electricity. The actual duration of long-term supply contracts ranges up to twenty years. The Company estimates that approximately half of the revenue related to minimum purchase requirements are estimated to be earned in the next five years and the remaining thereafter.

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Income Tax Disclosure (Notes)

3 Months Ended

Mar. 31, 2018

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

Note 16. Income Taxes

U.S. Tax Cuts and Jobs Act (Tax Act)

On December 22, 2017 the U.S. government enacted the Tax Cuts and Jobs Act (Tax Act). This comprehensive tax legislation significantly revises the U.S. corporate income tax rules by, among other things, lowering the corporate income tax rate from 35% to 21%, implementing a territorial tax system and imposing a one-time tax on accumulated earnings of foreign subsidiaries. Given the substantial uncertainties surrounding the Tax Act and the short period of time between December 22, 2017 and December 31, 2017 to calculate the U.S. Federal, U.S. state, and non-U.S. tax impacts of the Tax Act, the Company is accounting for its income tax charge on a provisional (estimated) basis as allowed by SEC Staff Accounting Bulletin No. 118. In 2017, the Company recorded a net provisional income tax charge of $394 million with three main components: (i) an estimated $467 million U.S. federal and state tax charge for deemed repatriation of accumulated foreign earnings; (ii) an estimated $260 million charge for foreign withholding taxes related to anticipated future repatriation of foreign earnings; and (iii) an estimated $333 million deferred tax benefit for the revaluation of net deferred tax liabilities from 35% to the new 21% tax rate. Refer to Note 5 to the consolidated financial statements of Praxair's 2017 Annual Report on Form 10-K.

During 2018, the Company will continue to evaluate the Tax Act, additional guidance from the Internal Revenue Service, its historical foreign earnings and taxes and other items that could impact its net provisional tax charge. Additionally, the Company will continue to review its foreign capital structures, organizational cash needs and the foreign withholding tax cost of planned repatriation. As new information becomes available, the Company will update its provisional estimate and record any changes to its income tax expense at that time. As of March 31, 2018, there have been no adjustments to the net provisional income tax charge recognized in 2017.

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Proposed Business Combination with Linde AG (Notes)

3 Months Ended

Mar. 31, 2018

Proposed Business Combination with Linde AG [Abstract]

Business Combination Disclosure [Text Block]

Proposed Business Combination with Linde AG

On June 1, 2017, Praxair, Inc. and Linde AG entered into a definitive Business Combination Agreement, as amended (the "Business Combination Agreement"), pursuant to which, among other things, Praxair, Inc. and Linde AG agreed to combine their respective businesses through an all-stock transaction, and become subsidiaries of a new holding company incorporated in Ireland, Linde plc. In connection with the proposed business combination, Linde plc filed a Registration Statement on Form S-4 which was declared effective by the U. S. Securities and Exchange Commission ("SEC") on August 14, 2017.

Linde plc has also filed an offer document with the German Federal Financial Supervisory Authority (Bundesanstalt fuer Finanzdienstleistungsaufsicht) (“BaFin”) which was approved for publication by BaFin on August 14, 2017 and published by Linde plc on August 15, 2017. Pursuant to the offer document, Linde plc made an offer to exchange each issued and outstanding no-par value bearer share of Linde AG for 1.540 ordinary shares of Linde plc (the “Exchange Offer”). In addition, Zamalight Subco, Inc., an indirect wholly-owned Delaware subsidiary of Linde plc, will merge with and into Praxair, Inc., with Praxair, Inc. surviving the merger (the “Merger”, and together with the Exchange Offer, the “Business Combination”). In the Merger, each share of Praxair, Inc. common stock will be converted into the right to receive one Linde plc ordinary share. Praxair Inc.’s stockholders approved the Merger at Praxair Inc.’s special meeting held on September 27, 2017, and on November 24, 2017, the tender period for the Exchange Offer expired with approximately 92% of all Linde AG shares entitled to voting rights being tendered. The parties currently expect the Business Combination to be completed in the second half of 2018. Upon completion of the business combination, Linde plc will apply to list its ordinary shares on the New York Stock Exchange and the Frankfurt Stock Exchange, and will seek inclusion in the S&P 500 and DAX 30 indices.

Completion of the Business Combination remains subject to approval by requisite governmental regulators and authorities, including approvals under applicable competition laws.

The Business Combination Agreement, or certain covenants contained therein, may be terminated for, or may terminate as a result of, certain reasons, including, among others, (a) the mutual consent of Praxair, Inc. and Linde AG to termination, (b) a permanent injunction or order by any governmental entity in Ireland, the United Kingdom, Germany or the United States that prohibits or makes illegal the completion of the Business Combination, (c) the occurrence of a change, event, occurrence or effect that has had or is reasonably expected to have a “material adverse change” (as defined in the Business Combination Agreement) on Linde AG or Praxair, Inc. or (d) the failure to obtain approval by requisite governmental regulators and authorities described in the preceding paragraph.

For additional information related to the Business Combination Agreement, please refer to the proxy statement/prospectus filed by Praxair, Inc. on Schedule 14A with the SEC on August 16, 2017.

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2018

Accounting Policies [Abstract]

Accounting Standards Implemented in 2017

Accounting Standards Implemented in 2018

• Revenue Recognition – In May 2014, the FASB issued updated guidance on the reporting and disclosure of revenue. Effective January 1, 2018, Praxair has adopted this guidance using the modified retrospective transition method. No material differences in revenue recognition accounting were identified under the new guidance compared with the Company's historic revenue recognition accounting (see Note 15).

• Classification of Certain Cash Receipts and Cash Payments – In August 2016, the FASB issued updated guidance on the classification of certain cash receipts and cash payments within the statement of cash flows. The update provides accounting guidance for specific cash flow issues with the objective of reducing diversity in practice. The adoption of this guidance did not have a material impact on the financial statements.

• Intra-Entity Asset Transfers – In October 2016, the FASB issued updated guidance for income tax accounting of intra-entity transfers of assets other than inventory. The update requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory in the period when the transfer occurs. The adoption of this guidance did not have a material impact on the financial statements.

• Pension Costs - In March 2017, the FASB issued updated guidance on the presentation of net periodic pension cost and net periodic postretirement benefit cost. The new guidance requires the service cost component be reported in the same line item or items as other compensation costs arising from services rendered by employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and not included within operating profit. This guidance was adopted in the first quarter 2018. Accordingly, non-service related components of net periodic pension and postretirement benefit costs were reclassified out of "Operating Profit" to "Net pension and OPEB cost (benefit), excluding service cost" using the practical expedient to use the amounts disclosed in the retirement benefits note for the prior comparative periods as the estimation basis for applying the retrospective presentation requirements (see Note 11).

Accounting Standards to be Implemented

Accounting Standards to be Implemented

• Leases – In February 2016, the FASB issued updated guidance on the accounting and financial statement presentation of leases. The new guidance requires lessees to recognize a right-of-use asset and lease liability for all leases, except those that meet certain scope exceptions, and would require expanded quantitative and qualitative disclosures. This guidance will be effective for Praxair beginning in the first quarter 2019 and requires companies to transition using a modified retrospective approach. Praxair is in the process of implementing the new guidance and will provide updates on the expected impact to Praxair in future filings, as appropriate.

• Credit Losses on Financial Instruments –In June 2016, the FASB issued an update on the measurement of credit losses. The guidance introduces a new accounting model for expected credit losses on financial instruments, including trade receivables, based on estimates of current expected credit losses. This guidance will be effective for Praxair beginning in the first quarter 2020, with early adoption permitted beginning in the first quarter 2019 and requires companies to apply the change in accounting on a prospective basis. We are currently evaluating the impact this update will have on our consolidated financial statements.

• Simplifying the Test for Goodwill Impairment – In January 2017, the FASB issued updated guidance on the measurement of goodwill. The new guidance eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge. The guidance will be effective for Praxair beginning in the first quarter 2020. Praxair does not expect this guidance to have a material impact.

• Derivatives and Hedging - In August 2017, the FASB issued updated guidance on accounting for hedging activities. The new guidance changes both the designation and measurement for qualifying hedging relationships and the presentation of hedge results. This guidance will be effective for Praxair beginning in the first quarter 2019, with early adoption optional. Praxair is currently evaluating the impact this update will have on our consolidated financial statements.

• Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income – In February 2018, the FASB issued updated guidance which allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. This new guidance will be effective for Praxair beginning in the first quarter 2019 on a retrospective basis, with early adoption optional. Praxair is currently assessing the impact and timing of adoption.

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Supplemental Information (Tables)

3 Months Ended

Mar. 31, 2018

Supplemental Information [Abstract]

Schedule Of Inventories Table

The following is a summary of Praxair’s consolidated inventories:

(Millions of dollars)	March 31, 2018		December 31, 2017
Inventories
Raw materials and supplies	$	223	$	224
Work in process	54		57
Finished goods	342		333
Total inventories	$	619	$	614

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Debt (Tables)

3 Months Ended

Mar. 31, 2018

Debt Disclosure [Abstract]

Long-term And Short-term Debt Table

The following is a summary of Praxair’s outstanding debt at March 31, 2018 and December 31, 2017:

(Millions of dollars)	March 31, 2018			December 31, 2017
SHORT-TERM
Commercial paper and U.S. bank borrowings	$	492		$	202
Other bank borrowings (primarily international)	35			36
Total short-term debt	527			238
LONG-TERM (a)
U.S. borrowings (U.S. dollar denominated unless otherwise noted)
1.20% Notes due 2018 (b)	—			498
1.25% Notes due 2018 (c)	474			475
4.50% Notes due 2019	599			599
1.90% Notes due 2019	500			500
1.50% Euro-denominated notes due 2020	737			717
2.25% Notes due 2020	299			299
4.05% Notes due 2021	498			498
3.00% Notes due 2021	497			497
2.45% Notes due 2022	598			598
2.20% Notes due 2022	498			498
2.70% Notes due 2023	498			498
1.20% Euro-denominated notes due 2024	675			658
2.65% Notes due 2025	397			397
1.625% Euro-denominated notes due 2025	610			594
3.20% Notes due 2026	725			725
3.55% Notes due 2042	662			662
Other	9			12
International bank borrowings	35			33
Obligations under capital leases	4			4
	8,315			8,762
Less: current portion of long-term debt	(979		)	(979		)
Total long-term debt	7,336			7,783
Total debt	$	8,842		$	9,000

(a) Amounts are net of unamortized discounts, premiums and/or debt issuance costs as applicable.

(b) In March 2018, Praxair repaid $500 million of 1.20% notes that became due.

(c) March 31, 2018 and December 31, 2017 include a $1 million fair value decrease and a less than $1 million increase, respectively, related to hedge accounting. See Note 6 for additional information.

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Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments Fair Value and Notional Amounts Table

The following table is a summary of the notional amount and fair value of derivatives outstanding at March 31, 2018 and December 31, 2017 for consolidated subsidiaries:

					Fair Value
	Notional Amounts				Assets				Liabilities
(Millions of dollars)	March 31, 2018		December 31, 2017		March 31, 2018		December 31, 2017		March 31, 2018		December 31, 2017
Derivatives Not Designated as Hedging Instruments:
Currency contracts:
Balance sheet items (a)	$	2,288	$	2,693	$	12	$	16	$	5	$	16
Derivatives Designated as Hedging Instruments:
Currency contracts:
Balance sheet items (a)	$	—	$	38	$	—	$	—	$	—	$	2
Forecasted purchases (a)	5		4		—		1		—		—
Interest rate contracts:
Interest rate swaps (a)	475		475		—		—		1		—
Total Hedges	$	480	$	517	$	—	$	1	$	1	$	2
Total Derivatives	$	2,768	$	3,210	$	12	$	17	$	6	$	18

(a) Assets are recorded in prepaid and other current assets, and liabilities are recorded in other current liabilities.

Schedule Of Treasury Rate Lock Contracts Table Text Block

The following table summarizes the unrecognized gains (losses) related to terminated treasury rate lock contracts:

	Year Terminated	Original Gain / (Loss)			Unrecognized Gain / (Loss) (a)
(Millions of dollars)					March 31, 2018			December 31, 2017
Treasury Rate Locks
Underlying debt instrument:
$500 million 2.20% fixed-rate notes that mature in 2022 (b)	2012	$	(2	)	$	(1	)	$	(1	)
$500 million 3.00% fixed-rate notes that mature in 2021 (b)	2011	(11		)	(4		)	(4		)
$600 million 4.50% fixed-rate notes that mature in 2019 (b)	2009	16			3			3
Total - pre-tax					$	(2	)	$	(2	)
Less: income taxes					1			1
After- tax amounts					$	(1	)	$	(1	)

(a) The unrecognized gains / (losses) for the treasury rate locks are shown in accumulated other comprehensive income (“AOCI”) and are being recognized on a straight line basis to interest expense – net over the term of the underlying debt agreements. Refer to the table below summarizing the impact on the company’s consolidated statements of income and AOCI for current period gain (loss) recognition.

(b) The notional amount of the treasury rate lock contracts are equal to the underlying debt instrument with the exception of the treasury rate lock contract entered into to hedge the $600 million4.50% fixed-rate notes that mature in 2019. The notional amount of this contract was $500 million.

Schedule of Derivative Instruments Not Designated as Hedging Instruments Table

The following table summarizes the impact of the company’s derivatives on the consolidated statements of income:

	Amount of Pre-Tax Gain (Loss) Recognized in Earnings *
	Quarter Ended March 31,
(Millions of dollars)	2018		2017
Derivatives Not Designated as Hedging Instruments
Currency contracts:
Balance sheet items
Debt-related	$	36	$	79
Other balance sheet items	2		1
Total	$	38	$	80

* The gains (losses) on balance sheet items are offset by gains (losses) recorded on the underlying hedged assets and liabilities. Accordingly, the gains (losses) for the derivatives and the underlying hedged assets and liabilities related to debt items are recorded in the consolidated statements of income as interest expense-net. Other balance sheet items and anticipated net income gains (losses) are recorded in the consolidated statements of income as other income (expenses)-net.

Schedule of Derivative Instruments Designated As Hedging Instruments Table

The following table summarizes the impacts of the company's derivatives designated as hedging instruments that impact AOCI:

Derivatives Designated as Hedging Instruments **

	Quarter Ended
	Amount of Gain  (Loss) Recognized in AOCI					Amount of Gain  (Loss) Reclassified from AOCI to the Consolidated Statement of Income
(Millions of dollars)	March 31, 2018		March 31, 2017			March 31, 2018		March 31, 2017
Currency contracts:
Balance sheet items	$	—	$	(1	)	$	—	$	—
Net investment hedge	—		—			—		—
Forecasted purchases	—		—			—		—
Interest rate contracts:
Treasury rate lock contracts	—		—			—		—
Total - pre tax	$	—	$	(1	)	$	—	$	—
Less: income taxes	—		1			—		—
Total - Net of Taxes	$	—	$	—		$	—	$	—

**The gains (losses) on net investment hedges are recorded as a component of AOCI within foreign currency translation adjustments in the condensed consolidated balance sheets and the condensed consolidated statements of comprehensive income. The gains (losses) on treasury rate locks are recorded as a component of AOCI within derivative instruments in the condensed consolidated balance sheets and the condensed consolidated statements of comprehensive income. There was no ineffectiveness for these instruments during 2018 or 2017. The gains (losses) on net investment hedges are reclassified to earnings only when the related currency translation adjustments are required to be reclassified, usually upon sale or liquidation of the investment. The gains (losses) for interest rate contracts are reclassified to earnings as interest expense –net on a straight-line basis over the remaining maturity of the underlying debt. Net losses of less than $1 million are expected to be reclassified to earnings during the next twelve months.

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Fair Value Disclosures (Tables)

3 Months Ended

Mar. 31, 2018

Fair Value Disclosures [Abstract]

Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis Table

The following table summarizes assets and liabilities measured at fair value on a recurring basis:

	Fair Value Measurements Using
	Level 1		Level 2				Level 3
(Millions of dollars)	March 31, 2018	December 31, 2017	March 31, 2018		December 31, 2017		March 31, 2018	December 31, 2017
Assets
Derivatives	—	—	$	12	$	17	—	—
Liabilities
Derivatives	—	—	$	6	$	18	—	—

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Earnings Per Share - Praxair, Inc. Shareholders (Tables)

3 Months Ended

Mar. 31, 2018

Earnings Per Share [Abstract]

Earnings Per Share Table - Praxair, Inc. Shareholders - Table

Basic earnings per share is computed by dividing Net income – Praxair, Inc. for the period by the weighted average number of Praxair common shares outstanding. Diluted earnings per share is computed by dividing Net income – Praxair, Inc. for the period by the weighted average number of Praxair common shares outstanding and dilutive common stock equivalents, as follows:

	Quarter Ended March 31,
	2018		2017
Numerator (Millions of dollars)
Net income - Praxair, Inc.	$	462	$	389
Denominator (Thousands of shares)
Weighted average shares outstanding	287,175		285,140
Shares earned and issuable under compensation plans	329		369
Weighted average shares used in basic earnings per share	287,504		285,509
Effect of dilutive securities
Stock options and awards	3,305		1,875
Weighted average shares used in diluted earnings per share	290,809		287,384
Basic Earnings Per Share	$	1.61	$	1.36
Diluted Earnings Per Share	$	1.59	$	1.35

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Goodwill and Other Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill Table

Changes in the carrying amount of goodwill for the three months ended March 31, 2018 were as follows:

(Millions of dollars)	North America		South America			Europe		Asia		Surface Technologies		Total
Balance, December 31, 2017	$	2,202	$	129		$	698	$	61	$	143	$	3,233
Acquisitions	—		—			—		—		—		—
Purchase adjustments & other	12		—			—		—		—		12
Foreign currency translation	3		(1		)	23		2		2		29
Balance, March 31, 2018	$	2,217	$	128		$	721	$	63	$	145	$	3,274

Schedule of Other Intangible Assets Table

Changes in the carrying amounts of other intangibles for the three months ended March 31, 2018 were as follows:

(Millions of dollars)	Customer & License/Use Agreements			Non-compete Agreements			Patents & Other			Total
Cost:
Balance, December 31, 2017	$	772		$	28		$	52		$	852
Additions	—			—			—			—
Foreign currency translation	8			—			—			8
Other*	(19		)	(5		)	—			(24		)
Balance, March 31, 2018	$	761		$	23		$	52		$	836
Less: Accumulated amortization
Balance, December 31, 2017	$	(260	)	$	(18	)	$	(21	)	$	(299	)
Amortization expense	(9		)	(1		)	(1		)	(11		)
Foreign currency translation	(3		)	—			—			(3		)
Other*	19			5			—			24
Balance, March 31, 2018	$	(253	)	$	(14	)	$	(22	)	$	(289	)
Net balance at March 31, 2018	$	508		$	9		$	30		$	547

* Other primarily relates to the write-off of fully amortized assets.

Schedule of Estimated Future Amortization Expense Table

Total estimated annual amortization expense is as follows:

(Millions of dollars)
Remaining 2018	$	33
2019	44
2020	42
2021	40
2022	39
Thereafter	349
	$	547

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Share-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions

The following weighted-average assumptions were used to value the grants in 2018 and 2017:

	Three months ended March 31,
	2018		2017
Dividend yield	2.1	%	2.7	%
Volatility	14.4	%	14.0	%
Risk-free interest rate	2.67	%	2.13	%
Expected term years	5		6

Schedule of Share-based Compensation, Stock Options, Activity

The following table summarizes option activity under the plans as of March 31, 2018 and changes during the three-month period then ended (averages are calculated on a weighted basis; life in years; intrinsic value expressed in millions):

	Number of Options  (000’s)		Average Exercise Price		Average Remaining Life	Aggregate Intrinsic Value
Outstanding at January 1, 2018	10,787		$	108.70
Granted	1,625		154.00
Exercised	(901	)	90.70
Cancelled or Expired	(16	)	115.09
Outstanding at March 31, 2018	11,495		116.50		6.7	$	335
Exercisable at March 31, 2018	7,755		$	109.67	5.5	$	269

Performance Based and Restricted Stock Activity

The following table summarizes non-vested performance-based and restricted stock award activity as of March 31, 2018 and changes during the three months then ended (shares based on target amounts, averages are calculated on a weighted basis):

	Performance-Based				Restricted Stock
	Number  of Shares (000’s)		Average Grant  Date Fair Value		Number  of Shares (000’s)		Average Grant  Date Fair Value
Non-vested at January 1, 2018	665		$	113.40	264		$	107.56
Granted	—		—		269		144.79
Vested	(78	)	120.04		(65	)	119.87
Cancelled and Forfeited	(147	)	111.63		(1	)	116.19
Non-vested at March 31, 2018	440		$	110.02	467		$	127.32

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Retirement Programs (Tables)

3 Months Ended

Mar. 31, 2018

Retirement Benefits, Description [Abstract]

Schedule of Pension and OPEB Net Periodic Benefit Costs Table

The components of net pension and postretirement benefits other than pensions (“OPEB”) costs for the quarters ended March 31, 2018 and 2017 are shown below:

	Quarter Ended March 31,
	Pensions						OPEB
(Millions of dollars)	2018			2017			2018			2017
Amount recognized in Operating Profit
Service cost	$	12		$	11		$	—		$	1
Amount recognized in Net pension and OPEB cost (benefit), excluding service cost
Interest cost	26			26			1			1
Expected return on plan assets	(42		)	(40		)	—			—
Net amortization and deferral	18			17			(1		)	(1		)
Curtailment gain (a)	—			—			—			(18		)
	$	2		$	3		$	—		$	(18	)
Net periodic benefit cost (benefit)	$	14		$	14		$	—		$	(17	)

(a) The curtailment gain recorded in the first quarter of 2017 resulted from the termination of an OPEB plan in South America.

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Segments (Tables)

3 Months Ended

Mar. 31, 2018

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, Sales Table

Sales and operating profit by segment for the quarters ended March 31, 2018 and 2017 are shown below. 2017 segment operating profit has been reclassified to conform with current year presentation as a result of the adoption of new accounting guidance on the presentation of net periodic pension and postretirement benefit costs (see Note 1).

	Quarter Ended March 31,
(Millions of dollars)	2018		2017
SALES(a)
North America	$	1,563	$	1,458
Europe	428		356
South America	365		369
Asia	476		395
Surface Technologies	167		150
Total sales	$	2,999	$	2,728

(a) Sales reflect external sales only. Intersegment sales, primarily from North America to other segments, were not material

Schedule Of Segment Reporting Information, Operating Profit

	Quarter Ended March 31,
(Millions of dollars)	2018			2017
OPERATING PROFIT
North America	$	406		$	357
Europe	80			67
South America	54			48
Asia	104			75
Surface Technologies	28			26
Segment operating profit	672			573
Transaction costs and other charges (Note 2)	(19		)	(6		)
Total operating profit	$	653		$	567

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Equity and Redeemable Noncontrolling Interests (Tables)

3 Months Ended

Mar. 31, 2018

Equity And Noncontrolling Interests Disclosure [Abstract]

Schedule of Stockholders Equity

A summary of the changes in total equity for the quarters ended March 31, 2018 and 2017 is provided below:

	Quarter Ended March 31,
(Millions of dollars)	2018									2017
Activity	Praxair, Inc. Shareholders’ Equity			Noncontrolling Interests			Total Equity			Praxair, Inc. Shareholders’ Equity			Noncontrolling Interests			Total Equity
Balance, beginning of period	$	6,018		$	493		$	6,511		$	5,021		$	420		$	5,441
Net income (a)	462			9			471			389			15			404
Other comprehensive income (loss)	118			11			129			315			5			320
Noncontrolling interests:
Additions (reductions)	—			6			6			—			—			—
Dividends and other capital changes	—			(3		)	(3		)	—			(4		)	(4		)
Redemption value adjustments	(2		)	—			(2		)	—			—			—
Dividends to Praxair, Inc. common stock holders ($0.825 per share in 2018 and $0.7875 per share in 2017)	(237		)	—			(237		)	(225		)	—			(225		)
Issuances of common stock:
For the dividend reinvestment and stock purchase plan	2			—			2			2			—			2
For employee savings and incentive plans	3			—			3			15			—			15
Purchases of common stock	—			—			—			—			—			—
Share-based compensation	4			—			4			12			—			12
Balance, end of period	$	6,368		$	516		$	6,884		$	5,529		$	436		$	5,965

(a) Net income for noncontrolling interests excludes Net income related to redeemable noncontrolling interests of $1 million for three months ended March 31,2018 (net income was insignificant for the same time period in 2017) which is not part of total equity (see redeemable noncontrolling interests section below).

Schedule of Accumulated Other Comprehensive Income (Loss)

The components of AOCI are as follows:

	March 31,			December 31,
(Millions of dollars)	2018			2017
Cumulative translation adjustment - net of taxes:
North America	$	(853	)	$	(885	)
South America	(2,011		)	(2,004		)
Europe	(384		)	(398		)
Asia	(95		)	(151		)
Surface Technologies	(8		)	(17		)
	(3,351		)	(3,455		)
Derivatives - net of taxes	(1		)	(1		)
Pension / OPEB funded status obligation (net of $343 million and $347 million tax benefit in March 31, 2018 and December 31, 2017, respectively)	(628		)	(642		)
	$	(3,980	)	$	(4,098	)

Redeemable Noncontrolling Interest

Following is a summary of the changes in redeemable noncontrolling interests for the three months ended March 31, 2018 and 2017:

(Millions of dollars)	2018			2017
Balance, January 1	$	11		$	11
Net income	1			—
Distributions to noncontrolling interest and other	(1		)	(1		)
Redemption value adjustments/accretion	2			—
Balance, March 31	$	13		$	10

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Revenue Recognition (Tables)

3 Months Ended

Mar. 31, 2018

Revenue Recognition [Abstract]

Schedule of Revenue by Distribution Method, by Reportable Segments [Table Text Block]

The following table shows sales by distribution method for each reportable segment and at the consolidated level for the quarter ended March 31, 2018.

(Dollars in Millions)			Industrial Gases
Sales	North America			Europe		South America		Asia		Surface Technologies		Total		%
Merchant	$	573		$	148	$	143	$	147	$	—	$	1,011	34	%
On-Site	460			80		114		246		—		900		30	%
Packaged Gas	493			181		98		54		—		826		27	%
Other	37			19		10		29		167		262		9	%
	$	1,563		$	428	$	365	$	476	$	167	$	2,999	100	%

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Transaction Costs and Other Charges (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Total Cost Reduction Program [Member]
Unusual or Infrequent Item, or Both [Line Items]
Income (Loss) from Continuing Operations, Per Diluted Share	$ (0.06)	$ (0.02)
Transaction Costs [Member]
Unusual or Infrequent Item, or Both [Line Items]
Transaction Costs	$ 19	$ 6
Income (Loss) from Continuing Operations, Net of Tax, Attributable to Parent	$ (18)

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Supplemental Information (Details) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Prepaid Expense and Other Assets, Noncurrent [Abstract]
Long-term receivables, net	$ 44	$ 54
Long-term receivables reserve	54	51
Inventory, Finished Goods and Work in Process, Gross [Abstract]
Raw materials and supplies	223	224
Work in process	54	57
Finished goods	342	333
Total inventories	$ 619	$ 614

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Debt (ST and LT Debt) (Details) - USD ($) $ in Millions		3 Months Ended
		Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Debt Instrument Line Items
Repayments of Long-term Debt		$ 503	$ 156
Fair Value Of Debt Instrument Increase Or Decrease		1		$ (1)
Long-term Debt, Current and Noncurrent [Abstract]
Commercial Paper and U.S. bank borrowings		492		202
Other bank borrowings (primarily international)		35		36
Total short-term debt		527		238
Obligations under capital lease		4		4
Carrying value of long-term debt including current portion		8,315		8,762
Less: current portion of long-term debt		979		979
Total long-term debt		7,336		7,783
Total debt		8,842		$ 9,000
UsLongTermFloatingRateNoteDue2017 [Member]
Debt Instrument Line Items
Repayments of Long-term Debt	[1],[2]	$ 500
US Long-term 1.20% Notes Due 2018
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		1.20%		1.20%
Senior Notes	[1]			$ 498
US Long-term 1.25% Notes due 2018
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		1.25%		1.25%
Senior Notes	[1],[3]	$ 474		$ 475
US Long-term 4.50% Notes due 2019
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		4.50%		4.50%
Senior Notes	[1]	$ 599		$ 599
US Long-term 1.90% Notes Due 2019
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		1.90%		1.90%
Senior Notes	[1]	$ 500		$ 500
Euro Denominated Long-term 1.50% Notes Due 2020
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		1.50%		1.50%
Senior Notes	[1]	$ 737		$ 717
US Long-term 2.25% notes due 2020 [Member]
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		2.25%		2.25%
Senior Notes	[1]	$ 299		$ 299
US Long-term 4.05% Notes due 2021
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		4.05%		4.05%
Senior Notes	[1]	$ 498		$ 498
US Long-term 3.00% Notes due 2021
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		3.00%		3.00%
Senior Notes	[1]	$ 497		$ 497
US Long-term 2.45% Notes due 2022
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		2.45%		2.45%
Senior Notes	[1]	$ 598		$ 598
US Long-term 2.20% Notes due 2022
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		2.20%		2.20%
Senior Notes	[1]	$ 498		$ 498
US Long-term 2.70% Notes due 2023
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		2.70%		2.70%
Senior Notes	[1]	$ 498		$ 498
Euro Denominated 1.20% Due 2024 [Member]
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		1.20%		1.20%
Senior Notes	[1]	$ 675		$ 658
US Long-term 2.65% Notes due 2025 [Member]
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		2.65%		2.65%
Senior Notes	[1]	$ 397		$ 397
Euro Denominated Long-term 1.625% Notes Due 2025 [Member] [Member]
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		1.625%		1.625%
Senior Notes	[1]	$ 610		$ 594
US Long-term 3.20% notes due 2026 [Member]
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		3.20%		3.20%
Senior Notes	[1]	$ 725		$ 725
US Long-term 3.55% Notes due 2042
Debt Instrument Line Items
Debt Instrument, Interest Rate, Stated Percentage		3.55%		3.55%
Senior Notes	[1]	$ 662		$ 662
US Long-term other
Debt Instrument Line Items
Other debt - carrying amount		9		12
Other International Bank Borrowings
Debt Instrument Line Items
Other debt - carrying amount		$ 35		$ 33

[1] Amounts are net of unamortized discounts, premiums and/or debt issuance costs as applicable.

[2] In March 2018, Praxair repaid $500 million of 1.20% notes that became due.

[3] March 31, 2018 and December 31, 2017 include a $1 million fair value decrease and a less than $1 million increase, respectively, related to hedge accounting. See Note 6 for additional information.

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Financial Instruments (Details) € in Millions, $ in Millions			3 Months Ended		12 Months Ended
		Dec. 31, 2017 USD ($) Rate	Mar. 31, 2018 USD ($)	Mar. 31, 2017 USD ($)	Dec. 31, 2017 USD ($) Rate	Dec. 31, 2012 USD ($)	Dec. 31, 2011 USD ($)	Dec. 31, 2009 USD ($)	Mar. 31, 2018 EUR (€)	Mar. 31, 2018 USD ($)	Jul. 31, 2012 USD ($)	Aug. 31, 2011 USD ($)	Dec. 31, 2008 USD ($)
Derivative [Line Items]
Notional Amount of Derivatives		$ 3,210			$ 3,210					$ 2,768
Derivatives Assets		17			17					12
Derivative Liabilities		$ 18			$ 18					6
Amount of Gain (Loss) Recognized in AOCI, Before Tax			$ 0	$ 1
Amount of Gain (Loss) Reclassified from AOCI to the Consolidated Statement of Income, Before Tax			0	0
Derivative Instruments, Tax Impact of Net Change in AOCI			0	(1)
Net gains (losses) to be recognized over next 12 months (approximately $1 million)										(1)
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent					35.00%
Federal Statutory Tax Rate following enactment of Tax Act, Percent		21.00%
Euro-denominated Notes not designated as hedging instrument | €									€ 130
Jul 2012 Treasury Lock [Member]
Derivative [Line Items]
Debt instrument, face value	[1]										$ 500
Debt Instrument, Interest Rate, Stated Percentage											2.20%
Aug 2011Treasury Lock [Member]
Derivative [Line Items]
Debt instrument, face value	[1]											$ 500
Debt Instrument, Interest Rate, Stated Percentage												3.00%
December 2008 Treasury Lock [Member]
Derivative [Line Items]
Debt instrument, face value	[1]												$ 600
Notional Amount of Derivatives													$ 500
Debt Instrument, Interest Rate, Stated Percentage													4.50%
Not Designated as Hedging Instrument [Member]
Derivative [Line Items]
Amount of Pre-Tax Gain (Loss) Recognized in Earnings	[2]		38	80
Not Designated as Hedging Instrument [Member] | Foreign Exchange Contract [Member]
Derivative [Line Items]
Notional Amount of Derivatives	[3]	$ 2,693			$ 2,693					2,288
Derivatives Assets	[3]	16			16					12
Derivative Liabilities	[3]	16			16					5
Not Designated as Hedging Instrument [Member] | Debt-Related [Member]
Derivative [Line Items]
Amount of Pre-Tax Gain (Loss) Recognized in Earnings	[2]		36	79
Not Designated as Hedging Instrument [Member] | Other Balance Sheet Items [Member]
Derivative [Line Items]
Amount of Pre-Tax Gain (Loss) Recognized in Earnings	[2]		2	1
Cash Flow Hedging [Member] | Interest Rate Lock Commitments [Member]
Derivative [Line Items]
Original deferred loss on settlement of derivative instruments - gross						$ (2)	$ (11)
Original deferred gain on settlement of derivative instruments - gross								$ 16
Cash Flow Hedging [Member] | Treasury Lock [Member]
Derivative [Line Items]
Deferred Gain (Loss) on Hedge, Gross	[4]	(2)			(2)					(2)
Derivative Instruments, Tax Impact of Net Change in AOCI	[4]		1		1
Derivative Instrument Gain Loss Recognized In Other Comprehensive Income Effective Portion Net Of Tax	[4]	(1)			(1)					(1)
Cash Flow Hedging [Member] | Jul 2012 Treasury Lock [Member]
Derivative [Line Items]
Deferred Gain (Loss) on Hedge, Gross	[4]	(1)			(1)					(1)
Cash Flow Hedging [Member] | Aug 2011Treasury Lock [Member]
Derivative [Line Items]
Deferred Gain (Loss) on Hedge, Gross	[4]	(4)			(4)					(4)
Cash Flow Hedging [Member] | December 2008 Treasury Lock [Member]
Derivative [Line Items]
Deferred Gain (Loss) on Hedge, Gross	[4]	3			3					3
Net Investment Hedging [Member]
Derivative [Line Items]
Derivatives used in Net Investment Hedge, Increase (Decrease), Gross of Tax			(46)
Derivatives used in Net Investment Hedge Increase (Decrease) since inception, Gross of Tax			51
Derivatives Designated as Hedging Instruments - Fair Value | Interest Rate Swap
Derivative [Line Items]
Debt instrument, face value										475
Notional Amount of Derivatives		475			475					475
Derivative Liabilities										$ 1
Debt Instrument, Interest Rate, Stated Percentage									1.25%	1.25%
Designated as Hedging Instrument
Derivative [Line Items]
Notional Amount of Derivatives		517			517					$ 480
Derivatives Assets		1			1					0
Derivative Liabilities		2			2					1
Amount of Gain (Loss) Recognized in AOCI, Before Tax	[5]			(1)
Amount of Gain (Loss) Recognized in AOCI, Net of Taxes	[5]		0	0
Amount of Gain (Loss) Reclassified from AOCI to the Consolidated Statement of Income, Before Tax	[5]		0	0
Derivative Instruments, Tax Impact of Net Change in AOCI	[5]			1
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Tax	[5]		0	0
Other Comprehensive Income (Loss), Reclassification Adjustment on Derivatives Included in Net Income, Net of Tax	[5]		$ 0	0
Designated as Hedging Instrument | Foreign Exchange Contract [Member]
Derivative [Line Items]
Notional Amount of Derivatives	[3]	38			38					0
Derivative Liabilities	[3]	2			2
Designated as Hedging Instrument | Balance Sheet Items [Member]
Derivative [Line Items]
Amount of Gain (Loss) Recognized in AOCI, Before Tax	[5]			$ (1)
Designated as Hedging Instrument | Forecasted Purchases
Derivative [Line Items]
Notional Amount of Derivatives	[3]	4			4					5
Derivatives Assets	[3]	1			1
Euro Denominated Long-term 1.50% Notes Due 2020
Derivative [Line Items]
Senior Notes	[6]	$ 717			$ 717					$ 737
Debt Instrument, Interest Rate, Stated Percentage		1.50%			1.50%				1.50%	1.50%
Euro Denominated Long-term 1.50% Notes Due 2020 | Net Investment Hedging [Member]
Derivative [Line Items]
Debt instrument, face value | €									€ 600
Senior Notes										$ 737
Debt Instrument, Interest Rate, Stated Percentage									1.50%	1.50%
Euro Denominated Long-term 1.625% Notes Due 2025 [Member] [Member]
Derivative [Line Items]
Senior Notes	[6]	$ 594			$ 594					$ 610
Debt Instrument, Interest Rate, Stated Percentage		1.625%			1.625%				1.625%	1.625%
Euro Denominated Long-term 1.625% Notes Due 2025 [Member] [Member] | Net Investment Hedging [Member]
Derivative [Line Items]
Debt instrument, face value | €									€ 500
Senior Notes										$ 610
Debt Instrument, Interest Rate, Stated Percentage									1.625%	1.625%
Euro Denominated 1.20% Due 2024 [Member]
Derivative [Line Items]
Senior Notes	[6]	$ 658			$ 658					$ 675
Debt Instrument, Interest Rate, Stated Percentage		1.20%			1.20%				1.20%	1.20%
Euro Denominated 1.20% Due 2024 [Member] | Net Investment Hedging [Member]
Derivative [Line Items]
Debt instrument, face value | €									€ 550
Senior Notes										$ 675
Debt Instrument, Interest Rate, Stated Percentage									1.20%	1.20%

[1] The notional amount of the treasury rate lock contracts are equal to the underlying debt instrument with the exception of the treasury rate lock contract entered into to hedge the $600 million 4.50% fixed-rate notes that mature in 2019. The notional amount of this contract was $500 million.

[2] The gains (losses) on balance sheet items are offset by gains (losses) recorded on the underlying hedged assets and liabilities. Accordingly, the gains (losses) for the derivatives and the underlying hedged assets and liabilities related to debt items are recorded in the consolidated statements of income as interest expense-net. Other balance sheet items and anticipated net income gains (losses) are recorded in the consolidated statements of income as other income (expenses)-net.

[3] Assets are recorded in prepaid and other current assets, and liabilities are recorded in other current liabilities.

[4] The unrecognized gains / (losses) for the treasury rate locks are shown in accumulated other comprehensive income (“AOCI”) and are being recognized on a straight line basis to interest expense – net over the term of the underlying debt agreements. Refer to the table below summarizing the impact on the company’s consolidated statements of income and AOCI for current period gain (loss) recognition.

[5] The gains (losses) on net investment hedges are recorded as a component of AOCI within foreign currency translation adjustments in the condensed consolidated balance sheets and the condensed consolidated statements of comprehensive income. The gains (losses) on treasury rate locks are recorded as a component of AOCI within derivative instruments in the condensed consolidated balance sheets and the condensed consolidated statements of comprehensive income. There was no ineffectiveness for these instruments during 2018 or 2017. The gains (losses) on net investment hedges are reclassified to earnings only when the related currency translation adjustments are required to be reclassified, usually upon sale or liquidation of the investment. The gains (losses) for interest rate contracts are reclassified to earnings as interest expense –net on a straight-line basis over the remaining maturity of the underlying debt. Net losses of less than $1 million are expected to be reclassified to earnings during the next twelve months.

[6] Amounts are net of unamortized discounts, premiums and/or debt issuance costs as applicable.

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Fair Value Disclosures (Details) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Assets and Liabilities Measured on a Recurring Basis
Derivative assets	$ 12	$ 17
Derivative liabilities	6	18
Fair Value Additional Information [Abstract]
Carrying value of long-term debt including current portion	8,315	8,762
Level 2 Member
Fair Value Additional Information [Abstract]
Fair value of long-term debt	8,380	8,969
Level 2 Member | Fair Value, Measurements, Recurring
Assets and Liabilities Measured on a Recurring Basis
Derivative assets	12	17
Derivative liabilities	$ 6	$ 18

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Earnings Per Share - Praxair, Inc. Shareholders (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Net Income (Loss) Attributable to Parent [Abstract]
Net income – Praxair, Inc.	$ 462	$ 389
Denominator (Details) [Abstract]
Weighted average shares outstanding	287,175,000	285,140,000
Shares earned and issuable under compensation plans	329,000	369,000
Weighted average shares used in basic earnings per share	287,504,000	285,509,000
Stock options and awards	3,305,000	1,875,000
Weighted average shares used in diluted earnings per share	290,809,000	287,384,000
Basic Earnings Per Common Share	$ 1.61	$ 1.36
Diluted earnings per share (usd per share)	$ 1.59	$ 1.35
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive excluded from the computation of Earnings Per Share		4,673,805

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Goodwill and Other Intangible Assets - Goodwill (Details) $ in Millions	3 Months Ended
	Mar. 31, 2018 USD ($)
Goodwill [Roll Forward]
Goodwill, Beginning Balance	$ 3,233
Goodwill, Acquired During Period	0
Purchase adjustments & other	12
Foreign currency translation	29
Goodwill, Ending Balance	3,274
North America Segment
Goodwill [Roll Forward]
Goodwill, Beginning Balance	2,202
Goodwill, Acquired During Period	0
Purchase adjustments & other	12
Foreign currency translation	3
Goodwill, Ending Balance	2,217
South America Segment
Goodwill [Roll Forward]
Goodwill, Beginning Balance	129
Goodwill, Acquired During Period	0
Foreign currency translation	(1)
Goodwill, Ending Balance	128
Europe Segment
Goodwill [Roll Forward]
Goodwill, Beginning Balance	698
Goodwill, Acquired During Period	0
Foreign currency translation	23
Goodwill, Ending Balance	721
Asia Segment
Goodwill [Roll Forward]
Goodwill, Beginning Balance	61
Goodwill, Acquired During Period	0
Foreign currency translation	2
Goodwill, Ending Balance	63
Surface Technologies Segment
Goodwill [Roll Forward]
Goodwill, Beginning Balance	143
Goodwill, Acquired During Period	0
Foreign currency translation	2
Goodwill, Ending Balance	$ 145

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Goodwill and Other Intangible Assets - Other Intangible Assets (Details) $ in Millions	3 Months Ended
	Mar. 31, 2018 USD ($)
Finite-lived Intangible Assets [Roll Forward]
Beginning Period Cost	$ 852
Additions (primarily acquisitions)	0
Foreign currency translation	8
Other	(24)	[1]
Ending Period Cost	836
Beginning Accumulated Amortization	(299)
Amortization expense	(11)
Foreign currency translation	(3)
Other	24	[1]
Ending Accumulated Amortization	(289)
Net balance finite lived intangibles	$ 547
Additional Finite Lived Intangible Asset Information (Details) [Abstract]
Finite-lived intangible asset, useful life	16 years
Remaining 2018	$ 33
2019	44
2020	42
2021	40
2022	39
Thereafter	349
Customer & License/Use Agreements
Finite-lived Intangible Assets [Roll Forward]
Beginning Period Cost	772
Additions (primarily acquisitions)	0
Foreign currency translation	8
Other	(19)	[1]
Ending Period Cost	761
Beginning Accumulated Amortization	(260)
Amortization expense	(9)
Foreign currency translation	(3)
Other	19	[1]
Ending Accumulated Amortization	(253)
Net balance finite lived intangibles	508
Non-compete Agreements
Finite-lived Intangible Assets [Roll Forward]
Beginning Period Cost	28
Additions (primarily acquisitions)	0
Other	(5)	[1]
Ending Period Cost	23
Beginning Accumulated Amortization	(18)
Amortization expense	(1)
Other	5	[1]
Ending Accumulated Amortization	(14)
Net balance finite lived intangibles	9
Patents & Other
Finite-lived Intangible Assets [Roll Forward]
Beginning Period Cost	52
Additions (primarily acquisitions)	0
Ending Period Cost	52
Beginning Accumulated Amortization	(21)
Amortization expense	(1)
Ending Accumulated Amortization	(22)
Net balance finite lived intangibles	$ 30

[1] Other primarily relates to the write-off of fully amortized assets.

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Share-Based Compensation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Closing Share Price	$ 144.30
Additional Company Information [Abstract]
Share-based Compensation Expense	$ 4	$ 12
Share-based Compensation Expense, Net of Tax	(10)	4
Excess Tax Benefits	$ 13	$ 4
Stock Options
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term	6 years 8 months
Unrecognized compensation expense	$ 40
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract]
Dividend yield	2.10%	2.70%
Volatility	14.40%	14.00%
Risk-free interest rate	2.67%	2.13%
Expected term years	5 years	6 years
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Stock Options Outstanding at January 1, 2018	10,787
Stock Options Granted	1,625
Stock Options Exercised	(901)
Stock Options Cancelled or Expired	(16)
Stock Options Outstanding at March 31, 2018	11,495
Stock Options Exercisable at March 31, 2018	7,755
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Outstanding at January 1, 2018 - average exercise price	$ 108.70
Granted - average exercise price	154.00
Exercised - average exercise price	90.70
Cancelled or Expired - average exercise price	115.09
Outstanding at March 31, 2018 - average exercise price	116.50
Exercisable at March 31, 2018 - average exercise price	$ 109.67
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term	5 years 6 months
Share-based Compensation Arrangement by Share-based Payment Award, Additional General Disclosures [Abstract]
Weighted-average fair values of options granted	$ 19.29	$ 12.40
Total intrinsic value of stock options exercised	$ 63	$ 18
Cash received from option exercises	78	19
Total cash tax benefit	$ 14	$ 8
Total compensation cost not yet recognized, period for recognition	1 year
Aggregate Intrinsic Value [Abstract]
Outstanding at March 31, 2018 - intrinsic value	$ 335
Exercisable at March 31, 2018 - intrinsic value	$ 269

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Share-Based Compensation (PSU and RSU) (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
PX Performance Based Awards
Additional Company Information [Abstract]
Performance based awards vesting, as a percentage of the target, low end of range	0.00%
Performance based awards vesting, as a percentage of the target, high end of range	200.00%
Total compensation cost not yet recognized, period for recognition	3 years
Cash-based Liability awards	6,000
Unrecognized compensation expense	$ 13
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Non-vested at January 1, 2018	665,000
Granted	0
Vested	(78,000)
Cancelled	(147,000)
Non-vested at March 31, 2018	440,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Non-vested at January 1, 2018, grant date fair value	$ 113.40
Granted - average grant date fair value	0.00
Vested - average grant date fair value	120.04
Cancelled - average grant date fair value	111.63
Non-vested at March 31, 2018, grant date fair value	$ 110.02
Restricted Stock
Additional Company Information [Abstract]
Cash-based Liability awards	3,000
Unrecognized compensation expense	$ 43
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Non-vested at January 1, 2018	264,000
Granted	269,433
Vested	(65,000)
Cancelled	(1,000)
Non-vested at March 31, 2018	467,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Non-vested at January 1, 2018, grant date fair value	$ 107.56
Granted - average grant date fair value	144.79	$ 109.64
Vested - average grant date fair value	119.87
Cancelled - average grant date fair value	116.19
Non-vested at March 31, 2018, grant date fair value	$ 127.32
Performance Shares ROC
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Granted - average grant date fair value		109.68
Performance Shares TSR
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Granted - average grant date fair value		$ 124.12
Maximum [Member] | PX Performance Based Awards
Additional Company Information [Abstract]
Award vesting period	2 years
Maximum [Member] | Restricted Stock
Additional Company Information [Abstract]
Award vesting period	3 years

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Retirement Programs (Net Pension and OPEB costs) (Details) - USD ($) $ in Millions		3 Months Ended
		Mar. 31, 2018	Mar. 31, 2017
Defined Benefit Plan Disclosure [Line Items]
Net pension and OPEB cost (benefit), excluding service cost		$ 2	$ (15)
Pension Plans Defined Benefit Member
Defined Benefit Plan Disclosure [Line Items]
Service cost		12	11
Interest cost		26	26
Expected return on plan assets		(42)	(40)
Net amortization and deferral		18	17
Net pension and OPEB cost (benefit), excluding service cost		2	3
Net periodic benefit cost		14	14
Other Postretirement Benefit Plans Defined Benefit
Defined Benefit Plan Disclosure [Line Items]
Service cost			1
Interest cost		1	1
Net amortization and deferral		(1)	(1)
Curtailment gain (a)	[1]		(18)
Net pension and OPEB cost (benefit), excluding service cost		0	(18)
Net periodic benefit cost		$ 0	$ (17)

[1] (a) The curtailment gain recorded in the first quarter of 2017 resulted from the termination of an OPEB plan in South America.

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Retirement Programs (Contributions and Future Estimated Payments) (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Defined Benefit Plan Disclosure [Line Items]
Pension contributions	$ 4	$ 3
Minimum [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Estimated Future Employer Contributions in Current Fiscal Year	15
Maximum [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Estimated Future Employer Contributions in Current Fiscal Year	$ 20

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Commitments and Contingencies (Lawsuits and Goverment Investigations) (Details) - 3 months ended Mar. 31, 2018 $ in Millions, R$ in Billions	USD ($)	BRL (R$)
Gain And Loss Contingencies [Abstract]
Brazil tax matters estimated exposure	$ 240
Initial CADE civil fine imposed	662	R$ 2.2
Revised CADE civil fine	$ 511	R$ 1.7
Percentage of guarantees to Brazilian Court initially satisfied by letters of credit	50.00%
Percentage of guarantees to Brazilian Court initially satisfied by equity	50.00%

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Segments (Details) - USD ($) $ in Millions		3 Months Ended
		Mar. 31, 2018	Mar. 31, 2017
Segment Reporting Information [Line Items]
Sales	[1]	$ 2,999	$ 2,728
Operating profit (loss)		653	567
Transaction costs and other charges (Note 2)		(19)	(6)
North America Segment
Segment Reporting Information [Line Items]
Sales	[1]	1,563	1,458
Operating profit (loss)		406	357
Europe Segment
Segment Reporting Information [Line Items]
Sales	[1]	428	356
Operating profit (loss)		80	67
South America Segment
Segment Reporting Information [Line Items]
Sales	[1]	365	369
Operating profit (loss)		54	48
Asia Segment
Segment Reporting Information [Line Items]
Sales	[1]	476	395
Operating profit (loss)		104	75
Surface Technologies Segment
Segment Reporting Information [Line Items]
Sales	[1]	167	150
Operating profit (loss)		28	26
Total Segments
Segment Reporting Information [Line Items]
Operating profit (loss)		672	573
Transaction costs and other charges (Note 2)		$ (19)	$ (6)

[1] Sales reflect external sales only. Intersegment sales, primarily from North America to other segments, were not material

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Equity and Redeemable Noncontrolling Interests Equity (Details) - USD ($) $ in Millions		3 Months Ended		12 Months Ended
		Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017	Dec. 31, 2016
Funded Status Obligations, Taxes		$ (343)		$ (347)
Net Income (Loss) Attributable to Redeemable Noncontrolling Interest		1
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax		(3,351)		(3,455)
Derivatives - net of taxes		(1)		(1)
Accumulated Other Comprehensive (Income) Loss, Defined Benefit Plan, after Tax		628		642
Accumulated other comprehensive income (loss)		(3,980)		(4,098)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Total Praxair, Inc. Shareholders’ Equity		6,368		6,018
Noncontrolling interests		516		493
Total Equity		6,884		6,511
Other comprehensive income (loss)		129	$ 320
Redemption value adjustments		(2)
Praxair, Inc. Shareholders' Equity
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Total Praxair, Inc. Shareholders’ Equity		6,368	5,529	6,018	$ 5,021
Net income	[1]	462	389
Other comprehensive income (loss)		118	315
Dividends to Praxair, Inc. common stock holders		(237)	(225)
For the dividend reinvestment and stock purchase plan		2	2
Redemption value adjustments		(2)
For employee savings and incentive plans		3	15
Share-based compensation		4	12
Noncontrolling Interests
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Noncontrolling interests		516	436	493	420
Net income	[1]	9	15
Other comprehensive income (loss)		11	5
Dividends and Other Capital Changes to Noncontrolling Interests		(3)	(4)
Additions (reductions) to noncontrolling interests		6
Total Equity
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Total Equity		6,884	5,965	6,511	$ 5,441
Net income	[1]	471	404
Other comprehensive income (loss)		129	320
Dividends and Other Capital Changes to Noncontrolling Interests		(3)	(4)
Dividends to Praxair, Inc. common stock holders		(237)	(225)
Additions (reductions) to noncontrolling interests		6
For the dividend reinvestment and stock purchase plan		2	2
Redemption value adjustments		(2)
For employee savings and incentive plans		3	15
Purchases of common stock			0
Share-based compensation		4	$ 12
North America Segment
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax		(853)		(885)
South America Segment
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax		(2,011)		(2,004)
Europe Segment
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax		(384)		(398)
Asia Segment
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax		(95)		(151)
Surface Technologies Segment
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax		$ (8)		$ (17)

[1] Net income for noncontrolling interests excludes Net income related to redeemable noncontrolling interests of $1 million for three months ended March 31,2018 (net income was insignificant for the same time period in 2017) which is not part of total equity (see redeemable noncontrolling interests section below).

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Equity and Redeemable Noncontrolling Interests (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Increase (Decrease) in Temporary Equity [Roll Forward]
Balance, January 1	$ 11	$ 11
Net income	1
Distributions to noncontrolling interest and other	(1)	(1)
Redemption value adjustments/accretion	2
Balance, March 31	$ 13	$ 10

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Revenue Recognition (Details) - USD ($) $ in Millions		3 Months Ended
		Mar. 31, 2018	Mar. 31, 2017
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Percentage of Total Sales, All Segments excluding Surface Technologies		94.00%
Percentage of Total Sales, Surface Technologies Segment		6.00%
Estimated Consideration related to Unsatisfied Performance Obligations		$ 17,000
Sales	[1]	$ 2,999	$ 2,728
Percentage of Total Sales, Distribution Method		100.00%
Merchant [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		$ 1,011
Percentage of Total Sales, Distribution Method		34.00%
On-Site [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		$ 900
Percentage of Total Sales, Distribution Method		30.00%
Packaged Gas [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		$ 826
Percentage of Total Sales, Distribution Method		27.00%
Other Distribution Methods [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		$ 262
Percentage of Total Sales, Distribution Method		9.00%
North America Segment
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales	[1]	$ 1,563	1,458
North America Segment | Merchant [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		573
North America Segment | On-Site [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		460
North America Segment | Packaged Gas [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		493
North America Segment | Other Distribution Methods [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		37
Europe Segment
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales	[1]	428	356
Europe Segment | Merchant [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		148
Europe Segment | On-Site [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		80
Europe Segment | Packaged Gas [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		181
Europe Segment | Other Distribution Methods [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		19
South America Segment
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales	[1]	365	369
South America Segment | Merchant [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		143
South America Segment | On-Site [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		114
South America Segment | Packaged Gas [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		98
South America Segment | Other Distribution Methods [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		10
Asia Segment
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales	[1]	476	395
Asia Segment | Merchant [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		147
Asia Segment | On-Site [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		246
Asia Segment | Packaged Gas [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		54
Asia Segment | Other Distribution Methods [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		29
Surface Technologies Segment
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales	[1]	167	$ 150
Surface Technologies Segment | Other Distribution Methods [Member]
Schedule of Revenue by Distribution Method, by Reportable Segment [Line Items]
Sales		$ 167

[1] Sales reflect external sales only. Intersegment sales, primarily from North America to other segments, were not material

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Income Tax Disclosure (Details) - USD ($) $ in Millions		12 Months Ended
	Dec. 31, 2017	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent		35.00%
Federal Statutory Tax Rate following enactment of Tax Act, Percent	21.00%
Net Provisional Income Tax Charge, enactment of Tax Act		$ 394
Estimated Charge on Deemed Repatriation of Accumulated Foreign Earnings, enactment of Tax Act		467
Estimated Foreign Withholding Taxes on Anticipated Repatriation, enactment of Tax Act		260
Estimated Federal Tax Benefit, Deferred Tax Revaluation, enactment of Tax Act		$ (333)

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Proposed Business Combination with Linde AG (Details) - shares	9 Months Ended	12 Months Ended
	Sep. 30, 2017	Dec. 31, 2017
Proposed Business Combination with Linde AG [Abstract]
Number of ordinary shares issued, per share	1.540
Percentage of voting rights tendered		92.00%