UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant ☒
Filed by a party other than the Registrant ☐
CHECK THE APPROPRIATE BOX:
| ☐ | Preliminary Proxy Statement |
| ☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
| ☐ | Definitive Proxy Statement |
| ☒ | Definitive Additional Materials |
| ☐ | Soliciting Material under §240.14a-12 |
Air Products and Chemicals, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
PAYMENT OF FILING FEE (CHECK ALL BOXES THAT APPLY):
| ☒ | No fee required |
| ☐ | Fee paid previously with preliminary materials |
| ☐ | Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11 |
On December 18, 2024, Air Products and Chemicals, Inc. (the “Company”) issued the following press release:
| News Release |
|
Air Products and Chemicals, Inc.
1940 Air Products Boulevard, Allentown, PA 18106-5500
www.airproducts.com
Air Products Files Investor Presentation Highlighting Successful Two-Pillar Strategy
to Deliver Superior Shareholder Value
The Company’s Board and Management, Under Chairman and CEO Seifi Ghasemi’s Leadership, Have Delivered
Over $44 Billion in Shareholder Value Creation1
Continues to Successfully Execute Two-Pillar Growth Strategy to Grow Core Industrial Gas Business While
Capitalizing on First-Mover Advantage in Clean Hydrogen Market
Air Products’ Board is Refreshed, Independent and Fit-For-Purpose –
Mantle Ridge’s Proposed Nominees Would Remove Significant and Relevant Experience and Expertise
Mantle Ridge’s Proposed Executive Chairman Candidate Appears Alarmingly Unfit to Lead Air Products or any
Public Company; Preferred CEO Candidate is Insufficiently Qualified
Board Mails Letter Urging Shareholders to Vote “FOR” ONLY Air Products’ Nominees
on the WHITE Proxy Card
LEHIGH VALLEY, PA – December 18, 2024 – Air Products (NYSE:APD) Board of Directors today announced that it has posted an investor presentation and mailed a letter to shareholders in connection with its upcoming 2025 Annual Meeting of Shareholders (the “Annual Meeting”), which will be held at 8:30 a.m. U.S. Eastern Time on January 23, 2025. All Air Products shareholders of record as of the close of business on November 27, 2024 will be entitled to vote at the Annual Meeting. The presentation and letter are both available at voteairproducts.com.
The full text of the letter summarizing the presentation follows:
Dear Fellow Shareholder,
The Air Products Annual Meeting is fast approaching, and you have an important opportunity to protect the value of your investment and the meaningful results the Company has delivered and anticipates continuing to deliver – as we have for the past 10 years. Under the supervision of our Board, management is executing a long-term strategy to grow our core industrial gas business, while leveraging decades of relevant expertise to capitalize on our important first-mover position in the clean hydrogen market to deliver maximized value for our shareholders.
| 1 | Based on $25.2B market capitalization on June 30, 2014 (one day prior to first day as CEO) and December 13, 2024 |
We ask that you please visit our Annual Meeting website at voteairproducts.com or the Company Investor Relations page to find a new investor presentation that we filed today, entitled “Creating Superior Shareholder Value Through Disciplined Investment in Clean Hydrogen,” where we go through, in greater detail, why our long-term growth strategy is the right one, why Air Products’ Nominees are the necessary leaders to move Air Products forward, and why shareholders should not support Mantle Ridge’s nominees.
We recommend you vote your shares “FOR” ONLY Air Products’ Nominees – Tonit M. Calaway, Charles Cogut, Lisa A. Davis, Seifollah Ghasemi, Jessica Trocchi Graziano, Edward L. Monser, Bhavesh V. (“Bob”) Patel, Wayne T. Smith and Alfred Stern – on the Company’s WHITE proxy card.
OVER THE PAST DECADE UNDER THE LEADERSHIP OF OUR CHIEF EXECUTIVE OFFICER, SEIFI GHASEMI, AIR PRODUCTS HAS CREATED OVER $44 BILLION IN SHAREHOLDER VALUE2
Since Mr. Ghasemi became CEO in 2014, he has spearheaded the transformation of Air Products into the most profitable industrial gas business in the world based on adjusted EBITDA margin, growing the business at GDP-plus rates. This strong cash generation has allowed Air Products to invest in our core industrial gas business, while expanding into clean hydrogen – a tremendous growth opportunity now and well into the future.
Our strong performance has directly benefitted shareholders through $11.5 billion in cash returned since 2014. In addition, our dividend per share has increased for 42 consecutive years and grown at a ~9% CAGR for the past 10 years, demonstrating our commitment to sharing with our investors the value we create. Including dividends, Air Products has delivered over $44 billion in total shareholder value3 over the last decade under Mr. Ghasemi’s leadership.
During Mr. Ghasemi’s tenure, the Company has delivered the following key financial outcomes:
| ✓ | Expanded adjusted EBITDA margin4 by +1,400 bps |
| ✓ | Achieved ~11% adjusted EPS CAGR5 |
| ✓ | Significant pricing and volume gains |
| ✓ | Sales have grown at a ~4% CAGR – higher than each public peer6 |
| 2 | Based on $25.2B market capitalization on June 30, 2014 (one day prior to Seifi Ghasemi’s first day as CEO) and December 13, 2024 |
| 3 | Based on $25.2B market capitalization on June 30, 2014 (one day prior to Seifi Ghasemi’s first day as CEO) and December 13, 2024 |
| 4 | Non-GAAP financial measure. Visit investors.airproducts.com for reconciliation. |
| 5 | Non-GAAP financial measure. Visit investors.airproducts.com for reconciliation. |
| 6 | Peers include Air Liquide, Linde and Nippon Sanso. Air Products based on GAAP sales CAGR from 9/30/14 to 9/30/24 as reclassified to give effect to divestitures of the PMD and EMD businesses. Air Liquide based on CAGR from 12/31/14 to 12/31/24(E) and is adjusted for its acquisition of Airgas. Linde based on CAGR from 12/31/16 to 12/31/24(E) and is adjusted for its combination with Praxair. Nippon Sanso based on CAGR from 3/31/18 to 3/31/25(E) and is adjusted for its acquisition of Praxair European Assets. Starting revenue data-point is converted to USD at historical FX rate |
Under Mr. Ghasemi’s direction, the Company has continuously pushed for profitability improvements and has been increasing its price-cost spread. This has been accomplished through favorable contract modifications over time, resulting in an increased contribution of stable on-site revenues. Further improvement and growth of the core industrial gas business are ongoing, and the Board and management team remain focused on maximizing value over the long-term.
AIR PRODUCTS IS SUCCESSFULLY EXECUTING A TWO-PILLAR GROWTH STRATEGY
TO CONTINUE DRIVING VALUE CREATION INTO THE FUTURE
We remain focused on investing in, and growing, our core industrial gas business, which delivers industry-leading profitability based on adjusted EBITDA margin,7 while advancing our first-mover advantage in the clean hydrogen market. We have allocated more than 50% of our total capital expenditures for FY 2023-2025 to our core business, underscoring our commitment to its continued growth. We have already launched multiple projects in recent years aimed at improving capacity, increasing efficiencies and reaching new industrial gas markets.
In tandem with these investments, Air Products is positioning the core business to capture opportunities for growth in expanding market segments. For instance, we have accumulated a critical mass of infrastructure strategically placed next to global electronics providers’ fabrication facilities, orienting our core industrial gas business to benefit from data center, AI and CHIPS Act tailwinds.
As a result of this approach, we have achieved significant tangible benefits to the business. Our on-site core capabilities model is driving resilience through a balanced mix of on-site and merchant sales. We are more heavily weighted toward the stable, infrastructure-like on-site business model than our peers, strengthening the durability of our business.
At the same time, we are expanding into clean hydrogen, a market with immense long-term potential:
| • | Today, 80% of the global energy market is fossil fuel-based,8 with clean hydrogen poised to play a major role in diversifying the mix of energy sources. |
| • | Clean hydrogen can be a source of energy like oil or gas but releases no climate-warming carbon dioxide, making it an ideal fuel for the future amid a global push to decarbonize emissions. |
| • | To grow long-term volumes, satisfy global decarbonization regulation, effectively serve evolving customer needs, and remain competitive, the industrial gases sector must invest in clean hydrogen capabilities. |
According to independent experts, the clean hydrogen market is expected to be worth more than $600 billion by 2030 and exceed $1 trillion by 2050.9 Clean hydrogen may contribute up to 20% of total global abatement needed by 2050.10 Clean hydrogen is anticipated to have applications across a diverse array of end markets including road transport, shipping, iron, aluminum and steel, chemicals and petrochemicals, and power generation.
| 7 | Non-GAAP financial measure. Visit investors.airproducts.com for reconciliation. |
| 8 | Source: International Energy Agency World Energy Outlook 2022 |
| 9 | Source: Deloitte 2023 Global Green Hydrogen Outlook |
| 10 | Science Direct – Direct 2021; Emerging carbon abatement technologies to mitigate energy-carbon footprint- a review |
No company is better positioned than Air Products – with more than 65 years of hydrogen experience – to meet the growing demand in this space, by serving global customers across industries working to improve efficiency and reliability while reducing emissions. Initially capturing even a small portion of the clean hydrogen market would provide incredible value for shareholders.
FIRST-MOVER ADVANTAGE IS ABSOLUTELY CRITICAL TO SUCCESS
IN THE CLEAN HYDROGEN MARKET – AND WE ARE SEEING EARLY RESULTS
There are four key elements that make being the first mover in clean hydrogen incredibly crucial, and where Air Products has an edge:
| • | Land scarcity: Access to ample resources such as sun and wind are critical to produce green hydrogen; and the right geology, large land plots, low-cost natural gas for carbon sequestration, and skilled labor are essential for blue hydrogen production. |
| • | Limited supply chain partners: Supply chain logistics are complex, and the necessary intellectual property and partners are limited. |
| • | Securing best-in-class customer agreements: We have the best seat at the table to negotiate offtake agreements with customers. |
| • | Obtaining highest-quality financing partners: Meaningful capital investment is needed to secure the backing of financing partners with the proper scale and industry expertise. |
Underpinning our advantage in these four important areas are the critical developments of proprietary knowledge and intellectual property, which enable a first-mover advantage to transition into a world-leading position.
Capturing a small portion of market share now will compound as the market continues to expand.
Because of our foresight and strategic investment, Air Products has achieved several early successes in clean hydrogen to date:
| ✓ | We announced a pioneering supply agreement in June 2024, a 15-year take-or-pay agreement to supply 70,000 tons of green hydrogen annually to decarbonize TotalEnergies’ Northern European refineries starting in 2030. We are also in discussions for green hydrogen supply to its other EU refineries. |
| ✓ | 60% of capacity for our Canada Net-Zero Hydrogen Energy Project is already committed, and negotiations for the remainder of the capacity are underway. |
| ✓ | We are the primary EPC contractor and system integrator of the NEOM Green Hydrogen Complex, the largest green-hydrogen-based ammonia production facility that will serve as a key solution for transportation and industrial sectors globally. Air Products is the exclusive off-taker of the green hydrogen produced in the form of green ammonia at the facility. |
| ✓ | We support Daimler’s European Hydrogen Refueling Network project to develop permanent and commercial scale hydrogen refueling stations and have announced networks are being built in California in addition to Canada and Europe. |
These important achievements are underpinned by the Board’s relentless focus on disciplined capital allocation and risk management controls. We remain focused on delivering on the onstream dates we have outlined and are securing more contracted offtake. The Company expects to generate positive net cash starting in FY2027.
AIR PRODUCTS’ BOARD IS REFRESHED, INDEPENDENT AND FIT-FOR-PURPOSE –
MANTLE RIDGE’S PROPOSED NOMINEES WOULD REMOVE SIGNIFICANT AND RELEVANT EXPERIENCE AND EXPERTISE FROM THE BOARD
Our Board is committed to strong governance practices, including regular Board refreshment. This is demonstrated through our diverse and continuously enhanced Board composition. With Air Products shareholders supporting our nominations of Mr. Patel and Mr. Stern at the 2025 Annual Meeting, six out of nine Directors will have been first elected in the last five years. Our Board is world-class with expertise across a full range of disciplines, from operations and supply chain optimization to corporate governance and regulations. It consists of individuals with high-caliber executive and leadership experience in chemicals, industrial manufacturing and renewables as well as public company board experience.
Mantle Ridge is seeking to replace four directors who are integral to our Board: Seifollah (Seifi) Ghasemi, Edward L. Monser, Charles Cogut and Lisa A. Davis. If successful, Mantle Ridge’s nominees would eliminate significant and relevant expertise brought by these current directors and disrupt the significant progress the Company has made.
| Seifollah “Seifi” Ghasemi Chairman, President and CEO of Air Products |
Dennis Reilley Mantle Ridge Chairman Nominee | |
| ✓ Highly respected executive in industrial gases and specialty chemicals
✓ Shareholder in APD with personal stake totaling around $239 million11
✓ Incentives highly aligned with shareholders
✓ Appointed CEO in 2014 after Pershing Square / Paul Hilal supported his appointment to the Board
✓ Significant industry CEO and executive experience |
X Multiple news outlets reported, based on testimony in a federal court plea hearing, that he leaked to a friend non-public information he was privy to during the period he served as a director of Covidien, DowDuPont and Marathon Oil, including, in the case of Covidien, about an upcoming M&A transaction resulting in federal and SEC enforcement charges and fines against the friend and a business associate | |
| 11 | Ownership value based on APD share price as of 12/13/2024 |
| ✓ Transformed Air Products by creating over $44 billion of shareholder value during his tenure12
✓ Built Air Products into the industry leader through organic revenue growth, margin expansion, EPS expansion, and the development and implementation of a Five-Point Plan to guide future success |
X Shortly before public disclosure of reportedly having leaked confidential information and the related enforcement actions, he resigned from three boards and has not served on the board of a public company since such resignations nearly six years ago
X Has not held an executive or operating position in over 17 years
X Owns no shares in APD
X Longstanding relationship with Mr. Hilal from tenure on CSX Board in connection with Mantle Ridge’s settlement with CSX and serving as a nominee of Mantle Ridge in its activist fight at Dollar Tree
X Has a two-year consulting agreement with Mantle Ridge, misaligning his interests from those of Air Products’ shareholders |
| Edward L. Monser Lead Independent Director of Air Products |
Paul Hilal Mantle Ridge CEO and Nominee | |
| ✓ Significant experience in industrial operations and supply chain optimization
✓ Appointed in 2014 with support from Pershing Square / Paul Hilal who stated as recently as October 2024 that: Ed Monser is “the kind of truly independent, high-integrity and shareholder-oriented director nominee [ ] that we think can best serve shareholders13”
✓ Over 30 years of experience leading global engineering organizations through strategic change |
X No experience with the board or operations of an industrial gas or chemicals company
X Track record of value destruction and mismanaged succession processes at all of Mantle Ridge’s public activist campaigns – Aramark, CSX and Dollar Tree – TSR relative to the S&P 500 during his Board tenures decreased at all companies: Dollar Tree -104%, CSX -69% and Aramark -63%14 | |
| 12 | Based on $25.2B market capitalization on June 30, 2014 (one day prior to first day as CEO) and December 13, 2024 |
| 13 | Permission to use quote neither sought nor obtained |
| 14 | TSR Reflects dividend-adjusted total return percentage over tenure or as of 12/13/2024 for current positions |
| ✓ Strong understanding of industrial operations, supply chain optimization and continuous improvement
✓ Extensive experience in international business operations in emerging markets |
X Dissident director slate appears assembled largely based on previous relationships and activism involvement as opposed to fit-for-purpose recruitment
X Under his board oversight, CSX said in October 2024 it had received a subpoena from the Securities and Exchange Commission over an accounting restatement, as well as information requests about some of the company’s performance metrics |
| Charles Cogut Independent Director of Air Products |
Tracy McKibben Mantle Ridge Nominee | |
| ✓ Leading corporate lawyer with multi-jurisdictional M&A expertise
✓ Regarded as one of the most prominent corporate lawyers in the United States
✓ 39-year tenure at Simpson Thacher & Bartlett LLP where he specialized in: domestic, international and cross-border M&A, the representation of special committees of boards of directors, buyouts and other transactions involving private equity firms
✓ Previously served as a director of The Williams Companies, Inc. |
X Less relevant experience than targeted directors
X Appears to have significantly less legal experience than Mr. Cogut
X Energy experience via advisory work is redundant, but on a much less comparable level given Lisa Davis and Alfred Stern’s much more significant energy expertise
X Former board experience includes governance issues involving related party transactions and involvement in controversial and unsuccessful activism campaigns | |
| Lisa A. Davis Independent Director of Air Products |
Andrew Evans Mantle Ridge Nominee | |
| ✓ Extensive experience leading world-scale energy projects, including renewables
✓ 35-year tenure leading large, multi-faceted international businesses within energy and manufacturing industries, overseeing and implementing world-scale energy projects |
X Less relevant experience than targeted directors
X Public executive and board experience limited to the U.S. and affiliation with an activist shareholder campaign
X Industry credentials and renewable energy project experience pale in caliber to those of Lisa Davis | |
| ✓ Served on public boards in the U.S. and Europe, knowledge which is crucial to the Company as it implements complex international projects which are an increasing portion of the business |
X Oversaw the finances of the Vogtle nuclear power plant expansion project at Southern Co as CEO, which was plagued by construction delays and cost overruns – the project was seven years late and $17 billion over budget |
MANTLE RIDGE’S PROPOSED EXECUTIVE CHAIRMAN CANDIDATE APPEARS ALARMINGLY UNFIT TO LEAD AIR PRODUCTS OR ANY PUBLIC COMPANY
The core pillar of Mantle Ridge’s efforts is the replacement of the Board’s lead independent director, Ed Monser, as well as our Chairman and CEO, Seifi Ghasemi, with its hand-picked successors, Dennis Reilley and Eduardo Menezes. As you consider changes which would upend the leadership at Air Products and derail our momentum, we believe it is important that you are aware of the following facts relating to Mr. Reilley that the Board became aware of during its thorough evaluation of Mantle Ridge’s nominees:
| • | In February 2019, a purported friend of Mr. Reilley, John Davidson, signed a plea agreement with the United States, admitting to making a false statement to the FBI that he had never received from “D.R.” any non-public information, which “D.R.” had acquired as a result of his position on the boards of Marathon Oil, DowDuPont, or Covidien.15 The plea agreement used the initials “D.R.” only when referring to the director in question. We note that Mr. Reilley was not named directly in the complaint by the United States. |
| • | Shortly thereafter, the media reported on the charges brought against Mr. Davidson, and noted clearly that the charges stemmed from the FBI’s investigation into Dennis Reilley and whether insider information was provided about the impending merger of Covidien PLC, with its rival, Medtronic Inc. The media noted that Mr. Reilley was a director at Covidien.16 |
| • | In December 2019, an associate of Mr. Davidson, John Special, was found liable and ordered to pay nearly $3 million in an SEC enforcement action,17 for allegedly trading on the basis of the information leaked by Mr. Davidson, who had received material, non-public information from a “Director” who served on the boards of Covidien, Marathon Oil and DowDuPont, including, in the case of Covidien, about a proposed transaction between Covidien and Medtronic. We note that Mr. Reilley was not named directly in the SEC’s complaint. |
| 15 | United States of America v. John Kenneth Davidson, Case No. 19-cr-56, filed on February 25, 2019. Transcript Dated March 5, 2019. |
| 16 | Nolan Clay, The Oklahoman, February 27, 2019, “FBI insider trading probe results in criminal charge in Oklahoma City federal court“ |
| 17 | Securities and Exchange Commission v. Special et al, Case No. 19-cv-1152, filed on December 12, 2019. |
| • | Notably, before news of the plea agreement and SEC enforcement action became publicly known, in December 2018 and January 2019, Mr. Reilley resigned as director of CSX (to which he had been appointed by Mantle Ridge) and DowDupont (both in December 2018), and as director and chairman of Marathon Oil (in February 2019), respectively. Mr. Reilley has not served on a public company board since these resignations. |
A portion of the transcript from the hearing in which Mr. Davidson pled guilty to lying to the FBI regarding who he received information in connection with the Covidien/Medtronic’s merger is pasted below. If true, the statements are deeply concerning, as they show the director in question leaked board confidences regularly with his friend:
MS. ANDERSON [Assistant U.S. Attorney]: And he D.R. provided you with nonpublic information he had received from all three of those boards, correct?
THE DEFENDANT: Yes, ma’am.
MS. ANDERSON: And he D.R. forwarded emails he received as a board member?
THE DEFENDANT: Yes, ma’am.
[…]
MS. ANDERSON: You had, in fact, received nonpublic information from D.R. that he had acquired from his board work at Covidien, Marathon and Dow, correct?
THE DEFENDANT: Yes, ma’am.
MS. ANDERSON: And sometime between March 2014 and May 15th, 2014, you specifically learned from D.R. about developing negotiations about Covidien’s merger with or acquisition by Medtronic, correct?
THE DEFENDANT: That is correct.
MS. ANDERSON: And you understood that information to be nonpublic, correct?
THE DEFENDANT: Yes, ma’am.
In a statement Mantle Ridge issued on December 13 in response to another media report on the matter, it stated, “To be clear, Mr. Reilley in no way acted inappropriately, and has never been accused of or charged with any impropriety or wrongdoing in connection with the matter.” Mantle Ridge also claimed in its response that Mr. Davidson’s testimony was “false”.
While Mr. Reilley was never formally charged by the FBI or the SEC for any wrongdoing, the information revealed in Mr. Davidson’s plea agreement and the SEC’s complaint against Mr. Special, if true, raises grave concerns about Mr. Reilley’s trustworthiness and ability to comply with his basic duty of confidentiality as a director. Mantle Ridge has offered no reasonable explanation to shareholders regarding this matter, other than to claim the testimony obtained under oath is false.
These circumstances not only call into question Mantle Ridge’s judgment in putting Mr. Reilley forward, but also the credibility of the entire Mantle Ridge slate and campaign. In the Board’s view, this matter should disqualify Mr. Reilley from ever again serving on a public company board.
MANTLE RIDGE’S PREFERRED CEO CANDIDATE IS INSUFFICIENTLY QUALIFIED
In addition, Mantle Ridge’s proposed CEO candidate, Eduardo Menezes, lacks public company CEO or board experience – two key criteria for Air Products’ next CEO that the Board established months ago. By proposing a CEO candidate like Mr. Menezes who would require substantial on-the-job training and chaperoning at a pivotal moment for the Company, Mantle Ridge has clearly demonstrated that it is not interested in a thoughtful succession process that would benefit all shareholders and is instead only concerned about its own interests. Mr. Menezes is insufficiently experienced and lacks the basic qualifications our Board is looking for in CEO candidates.
| Key CEO Search Qualities Established Before Engagement with Mantle Ridge by the Air Products Board |
Eduardo Menezes Mantle Ridge CEO Candidate | |
| ✓ Expert track record of value creation and superior industry experience as CEO or Board Director
✓ Strong investor relationships and well known to the investor community
✓ Current or former public company CEO
✓ Significant international experience
✓ Global relationships with policymakers and regulators |
X No significant employment experience outside of his tenure at Linde and the company’s subsidiaries
X Was passed over for the CEO role at Linde after 35 years with the company, never being promoted beyond EVP and Head of EMEA
X No public company C-suite or board experience
X Retired since leaving Linde in 2021 | |
In contrast to Mantle Ridge’s inadequate CEO candidate who fails to meet the Board’s previously communicated search criteria, Air Products is advancing with a CEO succession process to find an excellent candidate suited to lead the Company in this next stage of growth. This process was announced in August 2024, prior to D.E. Shaw’s, or Mantle Ridge’s involvement. The Board has committed to providing an announcement of a new President and related timeline for CEO succession no later than March 31, 2025.
Mr. Hilal and Mantle Ridge have run the same failed playbook in each of its three activist campaigns since its founding. Each case forced major changes, including replacing the CEOs, and have failed to create long-term value for shareholders relative to the S&P 500. Since its founding, Mantle Ridge has never run an activist campaign or made a CEO change that has driven outperformance.
Mantle Ridge’s stale, recycled playbook has failed before, and, if implemented at Air Products, would fail again. Mantle Ridge’s substandard Chairman and CEO candidates and lack of any credible plan leave us highly concerned that, if successful with its campaign, its actions would derail our clean hydrogen strategy and destroy shareholder value.
SAFEGUARD THE VALUE OF YOUR INVESTMENT IN AIR PRODUCTS BY VOTING “FOR” THE ELECTION OF ALL OF AIR PRODUCTS’ NINE NOMINEES ON THE WHITE PROXY CARD
The Board understands its responsibility to deliver value to ALL shareholders. The Board also, with the support of its leadership advisory firm, considered Mantle Ridge’s revised slate and unanimously determined these nominees still do not offer qualifications superior to Air Products’ well-balanced slate of nominees with the proper skills and experience to lead the Company through its next phase of growth.
| • | Tonit M. Calaway, Independent – Executive Vice President, Chief Administrative Officer, General Counsel and Secretary of BorgWarner Inc. |
| • | Charles “Casey” Cogut, Independent – Retired Partner, Simpson Thacher & Bartlett LLP |
| • | Lisa A. Davis, Independent – Former Member of the Managing Board and CEO of Gas and Power for Siemens AG |
| • | Seifollah “Seifi” Ghasemi, Chairman, President, and CEO |
| • | Jessica Trocchi Graziano, Independent – Senior Vice President and Chief Financial Officer of United States Steel Corporation |
| • | Edward L. Monser, Independent, Lead Director – Retired President and Chief Operating Officer of Emerson Electric Co. |
| • | Bhavesh V. (“Bob”) Patel, Independent, New Nominee – Former President of Standard Industries |
| • | Wayne T. Smith, Independent – Retired Chairman and Chief Executive Officer of BASF Corporation |
| • | Alfred Stern, Independent, New Nominee – Chief Executive Officer and Chairman of the Executive Board of OMV Aktiengesellschaft |
We strongly urge that you vote your shares “FOR” ONLY Air Products’ Nominees. Please discard any blue proxy card you may receive from Mantle Ridge.
Thank you for your ongoing support.
Sincerely,
The Air Products Board of Directors
For more information regarding our Board nominees and strategy, please visit: www.voteairproducts.com.
YOUR VOTE IS IMPORTANT. Whether or not you plan to virtually attend the 2025 Annual Meeting, please take a few minutes now to vote by Internet or by telephone by following the instructions on the WHITE proxy card, or to sign, date and return the enclosed WHITE proxy card in the enclosed postage-paid envelope provided. Regardless of the number of Company shares you own, your presence by proxy is helpful to establish a quorum and your vote is important.
OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” ONLY AIR PRODUCTS’ NINE NOMINEES AND PROPOSALS ON THE ENCLOSED WHITE PROXY CARD.
If you have any questions or require any assistance with voting your shares,
please call the Company’s proxy solicitor:
Innisfree M&A Incorporated
501 Madison Avenue, 20th Floor
New York, New York 10022
Shareholders: 1 (877) 750-0537 (toll-free from the U.S. and Canada)
or +1 (412) 232-3651 (from other countries)
About Air Products
Air Products (NYSE:APD) is a world-leading industrial gases company in operation for over 80 years focused on serving energy, environmental, and emerging markets and generating a cleaner future. The Company supplies essential industrial gases, related equipment and applications expertise to customers in dozens of industries, including refining, chemicals, metals, electronics, manufacturing, medical and food. As the leading global supplier of hydrogen, Air Products also develops, engineers, builds, owns and operates some of the world’s largest clean hydrogen projects, supporting the transition to low- and zero-carbon energy in the industrial and heavy-duty transportation sectors. Through its sale of equipment businesses, the Company also provides turbomachinery, membrane systems and cryogenic containers globally.
Air Products had fiscal 2024 sales of $12.1 billion from operations in approximately 50 countries and has a current market capitalization of over $65 billion. Approximately 23,000 passionate, talented and committed employees from diverse backgrounds are driven by Air Products’ higher purpose to create innovative solutions that benefit the environment, enhance sustainability and reimagine what’s possible to address the challenges facing customers, communities, and the world. For more information, visit airproducts.com or follow us on LinkedIn, X, Facebook or Instagram.
Non-GAAP Financial Measures
This communication contains certain financial measures that are not prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), including adjusted EPS, adjusted EBITDA, and adjusted EBITDA margin. On our website, at investors.airproducts.com, we have included definitions and reconciliations of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with GAAP. Management believes these non-GAAP financial measures provide investors, potential investors, securities analysts, and others with useful information to evaluate our business because such measures, when viewed together with our GAAP disclosures, provide a more complete understanding of the factors and trends affecting our business. The non-GAAP financial measures supplement our GAAP disclosures and are not meant to be considered in isolation or as a substitute for the most directly comparable measures prepared in accordance with GAAP. These measures may not be comparable to similarly titled measures used by other companies.
Forward-Looking Statements
This communication contains “forward-looking statements” within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s expectations and assumptions as of the date of this communication and are not guarantees of future performance. While forward-looking statements are made in good faith and based on assumptions, expectations and projections that management believes are reasonable based on currently available information, actual performance and financial results may differ materially from projections and estimates expressed in the forward-looking statements because of many factors, including the risk factors described in our Annual Report on Form 10-K for the fiscal year ended September 30, 2024 and other factors disclosed in our filings with the Securities and Exchange Commission. Except as required by law, we disclaim any obligation or undertaking to update or revise any forward-looking statements contained herein to reflect any change in the assumptions, beliefs or expectations or any change in events, conditions or circumstances upon which any such forward-looking statements are based.
# # #
Media Inquiries:
Katie McDonald, tel: (610) 481-3673; email: mcdonace@airproducts.com
Investor Inquiries:
Eric Guter, tel: (610) 481-1872; email: guterej@airproducts.com
Mun Shieh, tel: (610) 481-2951; shiehmh@airproducts.com
Also on December 18, 2024, the Company uploaded the following note to its employees to its intranet site:
CorpNEWS – 18 December 2024
Air Products Files Investor Presentation Highlighting Strategy to Deliver Superior Shareholder Value (12/18/24)
Dear Colleagues-
We wanted to take a moment to provide you with another quick update on Air Products’ proxy contest with activist investor Mantle Ridge, which owns a 1.8% stake in our Company and is seeking to gain four seats on our Board of Directors. On 18 December 2024, the Board issued another press release and letter to shareholders in connection with this: https://www.airproducts.com/company/news-center/2024/12/1218-air-products-files-investor-preso-highlighting-strategy-to-deliver-superior-shareholder-value
In addition, we filed an investor presentation entitled, “Creating Superior Shareholder Value Through Disciplined Investment in Clean Hydrogen.” The presentation goes into greater detail on why we believe our long-term two-pillar growth strategy is the right one, why Air Products’ nominees are the right leaders to move Air Products forward, and why shareholders should not support Mantle Ridge’s nominees. If you would like to review the presentation, please visit our Annual Meeting website at voteairproducts.com or the Filings/Reports section of our Investor Relations site.
As a reminder, if you are a shareholder in Air Products and need assistance voting your shares, you can visit voteairproducts.com for instructions, or you can contact our proxy solicitor, Innisfree M&A at 1(877) 750-0537 (toll-free from the U.S. and Canada) or +1 (412) 232-3651 (from other countries). Our leadership team strongly encourages those of you who own shares to vote ONLY “FOR” each of the nine highly qualified Air Products’ Nominees.
Please continue to stay focused on our mission and on our daily roles. As always, if you are contacted by any media, please direct them to the Corporate Communications team. If you are contacted by an analyst or investor, please direct them to our Investor Relations team.
Just as we have been, we will continue to keep you updated on any significant developments.
Thank you for your continued hard work and support.
All the best,
Seifi
Also on December 18, 2024, the Company posted the following material on its website, https://www.voteairproducts.com/:
Creating Superior Shareholder Value Through Disciplined Investment in Clean Hydrogen December 18, 2024
Forward-Looking Statements This presentation contains “forward-looking statements” within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements regarding the Company’s expectations; beliefs; plans; strategies; priorities and opportunities; future performance; business or financial prospects or outlook; future shareholder value; expected growth and value creation; profitability; investments; capital allocation, including dividends; financial performance; earnings expectations; expected drivers and guidance, including future unlevered free cash flow, adjusted EBITDA margin, and funding sources; expected benefits of new initiatives, including the Company’s expansion into the clean hydrogen market; cost reductions and efficiencies; products or business offerings (including timing and nature); priorities or performance; businesses and assets; future investments and output; collaborations; expected benefits; and other statements that are not historical in nature. These forward-looking statements are based on management’s expectations and assumptions as of the date of this presentation and are not guarantees of future performance. While forward-looking statements are made in good faith and based on assumptions, expectations and projections that management believes are reasonable based on currently available information, actual performance and financial results may differ materially from projections and estimates expressed in the forward-looking statements because of many factors, including those disclosed in our Annual Report on Form 10-K for our fiscal year ended September 30, 2024 as well as in our other filings with the Securities and Exchange Commission. Except as required by law, the Company disclaims any obligation or undertaking to update or revise any forward-looking statements contained herein to reflect any change in the assumptions, beliefs, or expectations or any change in events, conditions, or circumstances upon which any such forward-looking statements are based. Non-GAAP Financial Measures This presentation contains certain financial measures that are not prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), including adjusted EPS, adjusted EBITDA and adjusted EBITDA margin. In Appendix A, we have included definitions and reconciliations of these non- GAAP financial measures to the most directly comparable financial measures prepared in accordance with GAAP. Management believes these non- GAAP financial measures provide investors, potential investors, securities analysts, and others with useful information to evaluate our business because such measures, when viewed together with our GAAP disclosures, provide a more complete understanding of the factors and trends affecting our business. The non-GAAP financial measures supplement our GAAP disclosures and are not meant to be considered in isolation or as a substitute for the most directly comparable measures prepared in accordance with GAAP. These measures may not be comparable to similarly titled measures used by other companies. 2
Executive Summary Air Products Board and Management Have Consistently Delivered Results 01 (A) • We are the most profitable industrial gas business in the world based on Adjusted EBITDA margin , growing at GDP or industrial production levels – We operate core industrial gases infrastructure globally, including 1,800 miles of industrial gas pipeline and 750+ production facilities – ~50% of FY2024 sales were driven by our on-site customers; our on-site business model yields stable and consistent returns given that costs are passed through to the customers, the contracts are long-term (e.g., 10-20 years), and customers pay fixed monthly charges and / or have minimum purchase requirements (A) (A) • Significant gains in pricing, volume, and a stable, infrastructure-like on-site business model have delivered a 1,400bps increase in Adjusted EBITDA margin and a compound annual Adjusted EPS growth rate of ~11% since FY2014 (B) – Our sales have grown at a ~4% compound annual growth rate since FY2014 – higher than our public peers • Strong cash generation fuels continued increases in our dividend and strategic capital expenditures – Returned $11.5 billion of cash to shareholders since FY2014 – We have executed 42 consecutive years of dividend increases and have delivered a ~9% compound annual dividend growth rate since FY2014 (C) • Under the Board’s and Seifi Ghasemi’s leadership, Air Products has created more than $44B of shareholder value • Air Products has a track record of effectively executing on major projects, having successfully executed three major projects under the Board’s and Mr. Ghasemi’s stewardship over the last seven years alone – deploying $5B in capital and achieving overall returns across these projects exceeding our target – This includes the Lu’an Gasification Project, Jazan Industrial Complex and Uzbekistan Gas-to-Liquid Facility The Board and Management Have Developed and Are Executing on a Focused Strategy to Extend the Core into Clean Hydrogen 02 • Today, fossil fuels account for more than 80% of global energy production, with a meaningful CO footprint 2 – Clean hydrogen is a clean fuel of the future because it can be a source of energy like oil or gas but releases no climate-warming carbon dioxide • To grow long-term volumes, satisfy global decarbonization regulation, effectively serve evolving customer needs, and remain competitive, the industrial gases sector must invest in clean hydrogen capabilities – Clean hydrogen is a critical input for companies to reach their net-zero carbon emissions goals, including Air Products • Today, we are considered the leading supplier of hydrogen globally, and we are working to extend our leadership into clean hydrogen – We were the first industrial gases company to sell gray hydrogen over-the-fence and have been doing so for 50+ years – We capitalized on global desulfurization regulations in the 1990s to further supply hydrogen to refineries – We are using this strategy again to build upon our core business and capture growth in clean hydrogen • Because we are the first-mover, we have secured optimal locations globally and have begun forging critical supply chain and financing partnerships to excel in clean hydrogen – We are well-positioned to grow with the next phase of hydrogen development, which is clean hydrogen supported by the need to decarbonize hard-to-abate end markets – Our clean hydrogen growth will start with many of the same customers and end markets we know well and serve today • We are replicating the core industrial gases model: anchor customers, long-term committed offtake ahead of construction, take-or-pay contracts with cost pass-through – We expect positive net cash starting in FY2027 – Air Products’ clean hydrogen projects are expected to deliver returns at or above our core industrial gas return levels, producing significant additional value to our shareholders Sources: Company Filings and Presentations, Publicly Available Information, United Nations, Capital IQ (A) Non-GAAP financial measure. See Appendix for reconciliation 3 (B) Peers include Air Liquide, Linde and Nippon Sanso. Air Products based on GAAP sales CAGR from 9/30/14 to 9/30/24 as reclassified to give effect to divestitures of the PMD and EMD businesses. Air Liquide based on CAGR from 12/31/14 to 12/31/24(E) and is adjusted for its acquisition of Airgas. Linde based on CAGR from 12/31/16 to 12/31/24(E) and is adjusted for its combination with Praxair. Nippon Sanso based on CAGR from 3/31/18 to 3/31/25(E) and is adjusted for its acquisition of Praxair European Assets. Starting revenue data-point is converted to USD at historical FX rate (C) Based on $25.2B market capitalization on June 30, 2014 (one day prior to Seifi Ghasemi’s first day as CEO) and December 13, 2024
Executive Summary Refreshed, Independent and Fit-For-Purpose Board to Oversee Our Strategy 03 • The Air Products Board has the skills, experience, and expertise to oversee the successful execution of our two-pillar growth strategy to grow our core industrial gas business while capitalizing on our first-mover advantage in the clean hydrogen market and driving value creation • The Board and Management team have been responsive to shareholders regarding capital investment discipline, making several strategic announcements of late that had been under review, such as (a) not committing to new clean hydrogen projects until existing capacity is majority-committed and (b) no longer pursuing the Texas green hydrogen JV after concluding its return profile would be insufficient to meet our standards • The Board is committed to regular refreshment. To that end, six of nine directors on our slate were nominated in the last five years, including two new director nominees • Our two new nominees, Bob Patel and Alfred Stern, were selected after an extensive search process and bring significant experience leading and overseeing public companies as CEOs – Each has a stellar record growing major industrial companies internationally and capitalizing on clean energy and sustainability opportunities • The Board is conducting a thorough search, aided by an independent search firm, for a President to serve as a qualified CEO successor to Mr. Ghasemi – This search began in January 2023 and was formally announced in August 2024, prior to D.E. Shaw’s or Mantle Ridge's involvement. We anticipate the announcement of the new President and related timeline for CEO succession no later than March 31, 2025 • The Board is confident that we will recruit a candidate of superior caliber and experience: someone well known to investors and a current or former public company CEO with significant international experience and relationships to address the scale of our business • The Board is currently prioritizing five candidates from a pool of over 1,000 candidates Without Any Serious Plan for Value Creation, Mantle Ridge Seeks to Replace Air Products’ Board Leadership with Inferior Nominees 04 with Questionable Independent Thought • Our interactions with Paul Hilal and Mantle Ridge demonstrate a lack of judgment and a pattern of behavior that is beyond the basis for reasonable, constructive engagement. Mantle Ridge is seeking to seize control of Board leadership and management by replacing our Lead Independent Director, replacing two of three independent committee Chairs, firing our CEO, replacing the executive team, and halting our strategy that is on track to create substantial long-term shareholder value, without any viable alternative for growth • Mantle Ridge has proposed a new CEO candidate, despite not nominating him to their slate, who lacks public company CEO experience, has never served as a public company director and has not served in an operational role in four years • Mantle Ridge has proposed an Executive Board Chairman candidate who, according to media reports and court filings and transcripts, may have leaked confidential information from three companies on whose boards he was serving to a friend, leading to criminal charges being brought against the friend for lying to the FBI, and SEC enforcement action against the friend and another individual who appears to have traded on the basis of such information • Shortly before public disclosure of this candidate’s reportedly having leaked confidential information and the related enforcement actions, the candidate resigned from three boards and the candidate has not served on the board of a public company since such resignations nearly six years ago, and has not served in an operating role in 17 years • The election of Mantle Ridge's slate of nominees would remove critical expertise from our Board, including our CEO and Lead Independent Director, along with two other highly-qualified independent directors with extensive experience leading world-scale energy projects and multi-jurisdictional M&A expertise • We believe Mantle Ridge’s nominees have been selected, not because their experience is superior to or more relevant than our existing nominees, but rather because of pre-existing relationships with Mr. Hilal or their history as previous activist nominees • Shareholders should be concerned that the relationships between certain of Mantle Ridge’s nominees and Mr. Hilal could preclude them from acting independently 4
Business and Strategy Overview 5
Air Products Today • Air Products (NYSE:APD) is a world-leading industrial gases company, providing essential $12.1B ~23,000 ~50 industrial gases, related equipment, and applications expertise to customers around the world in FY2024 Sales Employees Countries dozens of industries ~42% • Air Products also develops, engineers, builds, owns, and operates some of the world’s largest ~$69B 250,000+ FY2024 Adj. clean hydrogen projects – capitalizing on the transition to low- and zero- carbon energy (A) Market Cap Customers (B) EBITDA Margin in the industrial and heavy-duty transportation end markets • Industrial gases produced include Argon, Carbon Dioxide, Carbon Monoxide, Syngas, Helium, 1,800 750+ 30+ Miles of Industrial Production Hydrogen, Nitrogen, Oxygen, and specialty gases Industries Served Gas Pipeline Facilities FY2024 Sales Breakdown By End Market By Segment By Supply Mode Other Other Food Sale of Equipment Medical 5% 8% 5% 7% 5% Chemicals 22% Manufacturing Americas Europe 10% 42% 23% On-site 49% Metals Energy Merchant 15% 21% 44% Asia Electronics 27% 17% 6 Sources: Company Filings and Presentations (A) As of December 13, 2024 (B) Non-GAAP financial measure. See Appendix for reconciliation
An Introduction to Industrial Gases What Are Industrial Gases? • Industrial gases businesses deliver mission-critical inputs to large-scale manufactures to enable them to drive efficiency and reduce emissions • Most common industrial gases are oxygen, nitrogen, hydrogen, carbon dioxide, and argon • The Atmosphere consists of 78% nitrogen, 21% oxygen, 1% argon, and traces of other gases such as neon, krypton, and xenon; hydrogen is manufactured How Are They Produced? • Atmospheric Gases: Atmospheric air is separated into different gases, commonly through distillation • Process Gases: Extracted from natural gas sources or produced as byproducts of chemical production and then separated and purified Where Are They Used? Consumer Related Industry Related Chemicals & Electronics Medical Food Manufacturing Metals Energy Who Are The Global Players? (A) 7 Source: National Oceanic and Atmospheric Administration (A) Private company; all other global players are publicly-traded
Air Products Maintains a Near-Majority Infrastructure-like Business Model Enables Stability Through Cycles Supply Through-Cycles Duration of Cost Pass- Key Take-or-Pay (A) Mode Mode of Supply Contract Through Attributes 49% • Stable, infrastructure-like • Facilities on or • Includes attractive electronics end near customer market On-Site sites 10-20 Years• Growth primarily driven by volume ✓✓ • Pipeline • Large-volume customers with long- Systems term contracts 34% • Follows trends in end markets • Bulk Form served Liquid Bulk 3-5 Years • Tanker or Tube Trailer • Includes attractive healthcare end market • Subject to end-customer demand 10% volatility given contract structure • Small Quantities • Price fluctuates Packaged Gas• Cylinder or Short-Term Dewar• Growth driven by both volume and price % of Air Products FY2024 Sales 8 Sources: Company Filings and Presentations and Publicly Available Information (A) Remaining 7% of FY2024 sales attributable to Sale of Equipment 44% of Sales (Merchant)
Air Products’ Two-Pillar Growth Strategy Core Industrial Gases Clean Hydrogen Size of Prize: ~$100B+ Size of Prize: ~$600B+ • World-leading industrial gases business with a reputation for • Extension of core business and 65+ years of experience as a market innovative culture, operational excellence, and commitment to safety leader in end-to-end supply of hydrogen • Leading supplier of atmospheric gases, process gases and • First-mover advantage: optimum locations for renewable resources; specialty gases in the Americas, Asia, Europe, Middle East and India access to low-cost natural gas and geology; and ability to negotiate clean hydrogen offtake agreements, establish industry pricing and develop intellectual property • Serves customers globally, providing atmospheric, process, and specialty gases, related equipment, and applications expertise • Strategy to initially capture a small portion of the vast, high-growth global hydrogen market • Develops, engineers, builds, owns, operates, and maintains some of the world’s largest industrial gas projects • Green hydrogen demand driven by Europe’s targets to decarbonize energy, industrial, and shipping industries • Serves customers in dozens of industries who rely on our products, related equipment, and applications expertise to improve efficiency and reduce emissions • Blue hydrogen demand driven by Asia’s targets to decarbonize the power sector (A) GDP+ Growth at 40%+ Adjusted EBITDA Margin GDP+ Growth, Target Returns At or Above with Strong and Contracted Cash Flows Our Core Industrial Gas Return Levels 9 Sources: Gasworld Intelligence, Deloitte’s 2023 global green hydrogen outlook; 2030 market size (A) Non-GAAP financial measure. See appendix for reconciliation
The Board and Seifi Ghasemi Delivered on All Aspects of The 2014 Five- Point Plan… Five-Point Plan 1 2 3 4 5 Focus on Restructure Change Align Control Capital / Costs the Core Organization Culture Rewards ✓ Restructured into a ✓ Safety-first culture; ✓ Established minimum ✓ Senior management to ✓ Grew from 170K fully decentralized, key safety metrics target hurdle rate of have meaningful stock customers to 250K+ regionally-run >50% improved since 10% IRR for new ownership, aligning today organization FY2014 projects interests with ✓ Sold Performance shareholder ✓ Established additional ✓ Simplified working ✓ Every capital Materials (Jan-2017) business unit P&L processes, including expenditure >$5 ✓ New annual incentive and spun off Electronics responsibility to drive decision-making million requires CEO plan included Materials (Oct-2016) to (A) results approval aggressive targets for focus on the core ✓ Speed as a core pillar Adjusted EPS and ✓ Reduced excess layers of Air Products’ culture✓ Cost discipline and ✓ Sold LNG process business unit-level of management productivity actions as technology & results top organizational equipment business priorities (Sep-2024) Under The Board’s and Seifi Ghasemi’s Leadership, (B) Air Products Has Created More Than $44B of Shareholder Value Sources: Air Products 2015 Annual Report, SEC Filings 10 (A) Air Products completed the sale of its Performance Materials Division in January 2017. Air Products completed the spin-off of the Electronics Materials division as Versum Materials in October 2016 (B) Based on $25.2B market capitalization on June 30, 2014 (one day prior to first day as CEO) and December 13, 2024
…And Have Made Significant Progress on Margin Expansion, Above- Market Growth, and Portfolio Clarity FY2014 FY2024 41.7% (B) 27.7% Significant Adjusted EBITDA (A) Margin Expansion $12.43 (B) (A) $4.42 11% Adjusted EPS CAGR Key Financial Statistics 4% 7% (C) Delivering on Portfolio Clarity 23% On-site 41% 49% Merchant 44% Electronics & Performance Materials Equipment & Energy 32% Under The Board’s and Seifi Ghasemi’s Leadership, (D) Air Products Has Created More Than $44B of Shareholder Value Sources: Company Filings and Presentations and Publicly Available Information (A) Non-GAAP financial measure. See appendix for reconciliation 11 (B) Reflected on a restated basis, accounting for separations of Performance Materials Division and Electronic Materials Division (C) Based on sales by supply mode. Air Products has re-segmented since FY2014. Tonnage Gases supply mode is now categorized as On-Site (D) Based on $25.2B market capitalization on June 30, 2014 (one day prior to first day as CEO) and December 13, 2024
Our Clean Hydrogen Business Model Is In-Line with the Traditional Industrial Gas Business Model Core Industrial Gases Clean Hydrogen Market Size and $100B+| Highly Global with ~40% US, ~$600B+ | Focused on Europe and Asia, (A) ~50% Asia & Europe Based on FY2024 Sales Driven by Stringent Emissions Regulation Geographic Focus Long-term contracted revenue commitment Long-term contracted revenue commitment Long-Term Commitments ✓✓ Given on-site model, typically one major anchor Our new projects going forward will have anchor Anchor Customers customer plant is committed customers committed ✓✓ Take-or-pay, energy cost change pass-through, inflation Take-or-pay, energy cost change pass-through, inflation Contractual Protections pass-through pass-through ✓✓ (B) (B) Target <20% Capex / Sales At run-rate, in-line with Core Industrial Gases business Cash Flow Profile ✓✓ Target >10% unlevered IRR for new projects Target >10% unlevered IRR for new projects Target IRR ✓✓ Sources: Gasworld Intelligence, Deloitte’s 2023 global green hydrogen outlook; 2030 market size 12 (A) Based on Air Products FY2024 sales breakdown (B) Non-GAAP financial measure. It is not possible, without unreasonable efforts, to reconcile forecasted capital expenditures to future cash used for investing activities because management is not able to identify the timing or occurrence of future investment activity, which is driven by management's assessment of competing opportunities at the time the Company enters into transactions
Executing on Our Strategic Priorities to Drive Value Creation 13
The Board Has Established a Successful Strategy Leadership Action Description Status 1 (A) • Continued investment in our core industrial gas business which has industry-leading margins Deliver for • Long-term take-or-pay contracts and cost pass-through underpin business stability ✓ Customers via (B) • Proportionally higher on-site sales mix relative to peers the Core Achieved / • Strong cash generation fuels strategic capital expenditures and continued increases in dividend Business Underway • Focus remains on delivering significant efficiency and productivity benefits for our global customers 2 • Achieve above-market growth via exposure to secular growth end markets such as electronics (17% of FY2024 sales), manufacturing (10%), medical (5%), and food (5%) Grow our Core ✓ • Positioned to benefit from data center, AI, and CHIPS Act tailwinds, with a critical mass of infrastructure already in place in Industrial Gases strategic locations where global electronics companies operate semiconductor production facilities Achieved / Business • Focused Asia Pacific growth strategy to develop gasification and electronics projects in region Underway • Global industrialization and heightened focus on energy security to drive demand for core industrial gases • Clean hydrogen identified as the next growth frontier in industrial gases 3 • Comparable business model (take-or-pay, cost pass-through) and target returns at or above our core industrial gas return levels for new projects Extend Our Core ~ • Need for decarbonization driven by multiple factors: Population growth, climate change, and global emissions policy Into Clean Early Innings • Success will be captured by being a first-mover – developing proprietary intellectual property and know-how and securing the Hydrogen of Growth best locations, supply chain partners, financing partners, and high-quality contracts with blue-chip customers • Leverage expertise developed during successful completion of three major recent projects (Lu’an Gasification Project, Jazan Industrial Complex, and Uzbekistan Gas-to-Liquid Facility), with overall returns across these projects exceeding our target Sources: Company Filings and Presentations, Publicly Available Information 14 (A) Based on Adjusted EBITDA Margin (B) Peers include Air Liquide and Linde. Nippon Sanso does not disclose on-site mix. Air Liquide sales mix based on Wall Street Research (permission to use data neither sought nor obtained). Linde sales mix based on Company Filings
1 Air Products Has Achieved Sector-Leading Sales Growth Long-Term Organic Sales Compound Annual Growth Rate (A) 4.0% 3.7% 3.5% 3.0% (B) 2.5% 2.3% (C) 2.0% 1.7% (D) 1.5% 1.3% 1.0% 0.5% 0.0% Air Products Nippon Sanso Linde Air Liquide Consistent Investment Has Led to Stronger Organic Sales Growth as Compared to Peers Sources: Company Filings, Company Press Releases, Capital IQ (A) Based on GAAP sales CAGR from 9/30/14-9/30/24 as reclassified to give effect to divestitures of the PMD and EMD businesses 15 (B) Based on CAGR from 3/31/18 to 3/31/25(E). Adjusted for acquisition of Praxair European Assets. Starting revenue data-point converted to USD at historical FX rate. Latest revenue data-point converted to USD at current FX rate (C) Based on CAGR from 12/31/16 to 12/31/24(E). Adjusted for combination with Praxair (D) Based on CAGR from 12/31/14 to 12/31/24(E). Adjusted for acquisition of Airgas. Starting revenue data-point converted to USD at historical FX rate. Latest revenue data-point converted to USD at current FX rate
1 Under the Board’s and Seifi Ghasemi’s Leadership, Margins Have Become Best-in-Class (A)(C) (A)(B) LTM Adjusted EBITDA Margin (%) Air Products Adjusted EBITDA Margin 45% 45.0% 41.7% 41.7% 40.9% 40.0% 38.2% 40% 38.9% 37.6% 37.3% 35.0% 34.9% 30.0% 34.9% 33.4% 27.7% 34.2% 35% 25.0% 22.8% 31.0% 20.0% 30% 27.7% 15.0% Rising energy costs inflated sales (denominator), 10.0% simultaneous lag in full 25% pass-through / recovery 5.0% 0.0% 20% 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Air Products Linde Air Liquide Nippon Sanso (A) Air Products is the Most Profitable Industrial Gas Business in the World Based on Adjusted EBITDA Margin Sources: Company Filings, Public Financial Statements (A) Non-GAAP financial measure. See appendix for reconciliation (B) Certain historical periods presented in the chart above were updated subsequent to filing the respective Annual Report on Form 10-K with the Securities and Exchange Commission. Fiscal years 2014 through 2016 reflect 16 classification of the PMD and EMD businesses as discontinued operations due to their separation in FY2017. Fiscal years 2014 through 2017 reflect retrospective application of the presentation requirements set forth in Accounting Standards Update ( ASU ) No. 2017-07, Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (C) Reflects latest LTM period available. For Air Products and Linde, reflects 9/30/24 LTM. For Nippon Sanso, reflects 10/31/24 LTM. For Air Liquide, reflects 12/31/23 LTM
(A) 1 Air Products Has Consistently Grown its Adjusted EPS and Dividend (A) Adjusted EPS ($) Dividends Per Share ($) $14.00 $8.00 $13.00 $12.00 $7.00 $11.00 $6.00 $10.00 $5.00 $9.00 $4.00 $8.00 $7.00 $3.00 $6.00 $2.00 $5.00 $1.00 $4.00 $3.00 $0.00 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 (A) Non-GAAP financial measure. See appendix for reconciliation 17
2 Air Products’ On-Site Model Drives Resilience Our Core Capabilities Are in the Traditional On-Site Business Model • Balanced mix of on-site and (A) Latest Sales Breakdown: Supply Mode merchant sales ꟷ Peers more heavily weighted (B) toward more volatile merchant & packaged businesses • On-site business governed by: 24% ꟷ Take-or-pay contracts, including minimum volume commitments 37% ꟷ 10-20 year contracts 44% ꟷ Price escalation provisions 12% 55% ꟷ Energy / cost inflation pass- 49% through mechanisms 64% 8% 7% (C) On-site Merchant Other Core On-Site Business Model Logical Extension is to Hydrogen Markets Sources: Company Filings and Wall Street Research (permission to use data neither sought nor obtained) 18 (A) Nippon Sanso is excluded as it does not report sales by supply mode (B) Based on Cowen equity research report on Air Products dated March 18, 2021. Permission to use data neither sought nor obtained (C) For Air Products, includes liquid bulk and packaged gas
2 Core Industrial Gases Business Serves Key Growth End Markets (A) SECULAR GROWTH END MARKETS More Resilient, GDP+ Growth • Example Customers: • Example Customers: • Example Customers: Food Semiconductor Fabricators, Hospitals, Medical Offices & Frozen, Food Producers, Solar Panel Manufacturers, and Clinics, Homecare Agricultural Produce, Fish Display / LED Manufacturers Customers Diagnostic Farmers 5% 5% 17% Facilities (MRI) • Example Use: Provides gas • Example Use: Ultra-fast purity and related supply • Example Use: Respiratory freezing, optimized grinding Electronics Medical Food equipment for oxygen and Whole-Body processes, and extended semiconductor fabrication Cryotherapy (WBC) shelf life (A) INDUSTRIAL-RELATED END MARKETS Subject to Some Cyclicality • Example Customers: Oil • Example Customers: • Example Customers: Companies, Chemical Steelmakers, Metal Recovery Automative & Aerospace Companies, Syngas Users & Recycling Companies, OEMs, Pulp & Paper 43% Mining Companies Producers, Consumers • Example Use: Hydrogen, 15% 10% Battery Manufacturers oxygen, nitrogen, carbon • Example Use: Argon used Chemicals & monoxide, and syngas as for unique inerting, thermal • Example Use: Carbon fiber Metals Manufacturing Energy feedstocks conductivity, and other manufacturing using properties nitrogen or argon to create an inert atmosphere Source: Publicly Available Information 19 (A) Reflects FY2024 end market mix. Remaining 5% of FY2024 sales attributable to “Other” end markets
2 Air Products Continues to Grow the Core Industrial Gases Business >50% of FY2023-FY2025 Total Capex is for Core Industrial Gases Announced Long-Term Build, Own, and Operate Awarded Long-Term Two New Air Separation Industrial Gases Supply Hydrogen and Nitrogen Agreement with World- Units at Air Products’ Supply Agreement for leading Semiconductor Facilities in Georgia and Indian Oil Corporation North Carolina Manufacturer in Asia Announcement Date: June 2022 Announcement Date: July 2024 Announcement Date: April 2022 • Build, own and operate state-of-the-art on-site • Air Products will construct two new air separation • Build, own and operate a new industrial gases plants to supply ultra-high purity nitrogen, oxygen, units (ASU) at its existing Conyers, Georgia and complex supplying hydrogen, nitrogen and steam argon and hydrogen Reidsville, North Carolina locations to IOCL’s Barauni Refinery in Bihar, India • Won a contract from one of the world’s largest • Both new ASUs will replace older units and • The new industrial gas complex will aid IOCL’s semiconductor manufacturers to supply provide additional capacity at the locations capacity expansion from six to nine million industrial gases to a new plant in Taiwan tonnes per annum producing Euro-VI or BS-VI • Projected to be onstream in 2026 compliant gasoline and diesel at its Barauni complex 20
3 Clean Hydrogen is an Extension of Our Core Business… Leveraging Our Hydrogen Expertise to Create New Growth • Air Products was the first industrial gas company to sell gray hydrogen over-the-fence • In the 1990s, Air Products significantly expanded its presence in supplying hydrogen to First-Mover in Flue-Gas refineries as increasingly strict emissions regulations were put in place Desulfurization, Forging • Built high-efficiency hydrogen plants for refineries, set up distribution infrastructure, and Early Partnerships in established institutional knowledge and intellectual property to excel in the hydrogen business in Hydrogen the decades to come through first-mover advantage • Formed partnerships early on with both the public sector and private sector, establishing a reputation as the hydrogen provider of choice • Today, Air Products is considered the leading supplier of hydrogen globally • Operates >110 hydrogen production facilities with >700 miles of hydrogen pipeline networks globally Air Products Now Has the Leading Gray Hydrogen • Executed more than 250 hydrogen fueling stations projects in 20 countries globally – relative to each (A) of Air Liquide’s and Linde’s 200 hydrogen fueling stations Platform • >50 customers with long-term hydrogen contracts • Once again capitalizing on global decarbonization regulations Green and Blue Hydrogen • Well-positioned to grow with the next phase of hydrogen development, which is clean hydrogen supported by the need to decarbonize hard-to-abate end markets Are Logical Extensions of Core Industrial Gases • Replicating our core industrial gases model: on-site with long-term take-or-pay contracts • We expect positive net cash starting in FY2027 (A) Sources: Linde Company Website, Air Liquide Company Website 21
3 … And a Growth Opportunity Well-Aligned With Our Core Capabilities Leveraging Our Hydrogen Expertise to Create New Growth Core Industrial Gases Gray Hydrogen Blue Hydrogen Green Hydrogen • Atmospheric gases: oxygen, nitrogen, argon Expertise in Hydrogen • Process gases: hydrogen• Process gases: hydrogen • Process gases: hydrogen • Process gases: hydrogen, helium, Through Core Industrial carbon dioxide, carbon monoxide, • Natural gas • Carbon capture• Renewable energy Gases Business syngas • Specialty gases • Unique, highly valuable molecule • Unique, highly valuable molecule • Serving customers through various • Heavily focused on on-site model modes, including on-site commanding premium pricing commanding premium pricing • Customers require large volumes • Offered globally in a variety of Consistent Strategy • Target customers in Asia, where • Target customers in Europe, where with relatively constant demand purities decarbonization regulations promote demand is driven by RED III, ReFuelEU • Target all regions globally • Extensive infrastructure in place emissions reduction Aviation, FuelEU Maritime Regulation • Contracted offtake Supplying Customers • Contracted offtake • Contracted offtake • Pioneered the on-site business model On a Long-Term, over 80 years ago • Large-scale on-site hydrogen plants • Long-term, take-or-pay customer contracts Contracted Basis (A) • ~50% on-site sales mix Energy Steel Chemicals Energy Chemicals Electronics Metals Energy Chemicals Electronics Metals Expanding Into New, Attractive End Markets Manufacturing Medical Food Manufacturing Medical Food Aggregates Power Plants Shipping Air Products’ Board and Leadership Team Have Led the Company’s Expansion into Clean Hydrogen (A) Based on Air Products FY2024 sales 22 22
3 Where We Will Replicate Our Gray Hydrogen Growth Strategy Leveraging Our Hydrogen Expertise to Create New Growth • Hydrogen is critical to petroleum Growth of U.S. Gulf Coast Franchise refiners who depend on it to (million standard cubic feet per day) produce low sulfur fuels to meet clean air regulations and increase per-barrel production • Petrochemical producers rely on 2,0 00 hydrogen to back up their 1,837 operations and as an outlet for 1,8 00 1,662 their hydrogen off-gas 1,6 00 • Air Products has expanded its 1,4 00 U.S. Gulf Coast network to meet 1,123 1,2 00 customer demand 1,0 00 ꟷ 25 hydrogen facilities 800 ꟷ >1,800 mmscfd 600 ꟷ ~700-mile hydrogen pipeline 400 ꟷ >50 customers with long- 200 term contracts 0 2014 2020 2024 Clean Fuel Regulations and Heavier Crude Slates Have Driven Significant Demand for (Gray) Hydrogen, Which Air Products Has Capitalized On 23
3 Decarbonization is Supported by Global Regulation EUROPE JAPAN KOREA Deep Sea • Fuel EU Maritime • IMO 2023 GHG Strategy• IMO 2023 GHG Strategy NH • IMO 2023 GHG Strategy 3 Shipping • EU Emission Trading System • A global energy transition and coordinated drive toward more • Korea ETS • Japan carbon tax Power sustainable industry inputs • EU Emission Trading System• Clean Hydrogen Portfolio Standard NH • Ammonia co-combustion targets 3 • Renewable Energy Directive III• Ammonia and hydrogen use in power Generation remains a durable theme across • Japan’s Basic Hydrogen Strategy • Hydrogen Economy Roadmap our markets Chemical • EU Emission Trading System • Japan carbon tax• Korea ETS NH 3• Renewable Energy Directive III • Transitory policy shifts will Production• Japan’s Basic Hydrogen Strategy• Hydrogen Economy Roadmap • CBAM impact rate of adoption locally • Japan carbon tax (e.g., recent US election), but • EU Emission Trading System• Korea ETS Industry GH• Japan’s Basic Hydrogen Strategy 2 • Renewable Energy Directive III• Hydrogen Economy Roadmap decarbonization likely to • Contract for Difference (CfD) continue to see momentum • Fuel EU Maritime Inland GH• EU Emission Trading System• NA• NA 2 Shipping ꟷ The theme falling “out of • Restrictions in navigation areas favor” with investors solely • EU Emission Trading System H• NA• NA Merchant reflects short-term outlook 2 • Renewable Energy Directive III ꟷ The long-term financial • Renewable Energy Directive III Heavy Duty, • CO emission standards for new HDV attractiveness of the clean 2 • Japan carbon tax• Korea ETS Road, and• EU Emission Trading System 2 LH 2 • Japan’s Basic Hydrogen Strategy• Hydrogen Economy Roadmap hydrogen strategy remains • AFIR Mobility • National Road taxes (toll tax) intact • Refuel EU Aviation LH • NA• Korea ETS Aviation 2 • EU Emission Trading System • Fuel EU Maritime Passenger LH• IMO 2023 GHG Strategy• NA• NA 2 Shipping • Restrictions in navigation areas Meaningful Tailwinds Globally, Particularly in Europe and Asia – Which Are the Target Markets For Our Clean Hydrogen Projects 24
3 Clean Hydrogen has Applications Across a Diverse Array of Growing End Markets Hydrogen May Contribute Up to 20% of Global Emissions Clean Fuels Can be Widely Applied to Decarbonize a Broad (A) Reduction by 2050 Range of End Markets (B) Annual CO Emission (Gt/year) / Abatement by Technology (%) 2 Energy-related CO Emissions (Gt/yr) 2 End Markets Key Decarbonization Solutions 35 Clean Up to 20% Hydrogen Shipping Clean Ammonia, Biofuels, Electrification Buildings 30 Iron, Aluminum, Clean Hydrogen, Carbon Capture Storage (CCS), Biomass, and Steel Circular Economy, Electrification 25 Transport District Heat Chemicals and 20 Biomass, Clean Hydrogen, CCS, Circular Economy Petrochemicals Other 80% Renewables 15 & Energy Power Generation Clean Ammonia, Cleaned Biogas, Renewables Power Efficiency 10 Road Transport Direct Electrification, Clean Hydrogen, Biofuels 5 Industry Aviation Biofuels, Synfuels from Clean Hydrogen, Electrification 0 2010 2020 2030 2040 2050 (A) Science Direct – Direct 2021; Emerging carbon abatement technologies to mitigate energy-carbon footprint- a review 25 (B) Hydrogen Council and McKinsey & Company – November 2021; Hydrogen for Net-Zero| A critical cost-competitive energy vector
3 Clean Hydrogen Represents a Trillion Dollar Market Opportunity Air Products’ Approved Clean H Projects Represent <1% of the Future Market 2 • Decarbonization of hard-to-abate end markets (heavy industry and Evolution of Clean Hydrogen Demand by End Market heavy-duty transportation) • Already >1,000ktpa of public 2030 2050 tenders for clean hydrogen Iron & Steel • Adoption driven by both first- movers and compliance requirements (A) Diversified Industrial 172 598 (B) Transportation MtH 2eq MtH 2eq Power Buildings ~2x Market Revenue $642B $1.4T Opportunity Source: Deloitte’s 2023 global green hydrogen outlook 26 (A) Includes chemicals, textile fibers manufacturing, electronics, recycling, and oil refining (B) Includes aviation, shipping, and heavy road transport
3 First-Mover Advantage is Absolutely Critical to Success in the Clean Hydrogen Market Limited Supply Land • Transition to clean hydrogen requires significant upfront Chain Partners Scarcity capital, but there is no concept of a ‘fast-follower’• Access to renewable resources is critical to • Supply chains to enable new clean hydrogen produce green hydrogen (e.g., sun and wind) facilities are complex • New facilities require land, • Geology and low-cost natural gas for carbon • Putting in place the right supplier and access to labor, permits, vendor sequestration to make blue hydrogen transportation & logistics arrangements is a relationships, and potentially • Requires massive plots of land in areas with significant undertaking outside capital – each of which available skilled labor• Suppliers look to partner with well-capitalized, have limited participants in the • After acquiring land, projects require extensive credible leaders with intellectual property value chains permitting • Critical to show customers real progress on the ground to Best-in-Class Customer High-Quality secure contracts Offtake Agreements Financing Partners • Projects can take up to 10 years • First-movers get the best seat at the table with • Meaningful capital investment needed, with a to come onstream customers to negotiate the offtake agreements narrow set of financing partners focused on • Ability to establish market pricing as a first- investing at scale in clean energy • Partnerships across the value mover• Access capital markets while still unsaturated – chain are being forged now to set the business up for success • Virtuous cycle – proven results and progress both on the private and public / government side attracts customers 10+ years from now Underpinned by Critical Development of Proprietary Know-How and Intellectual Property 27
3 Significant Market Demand for Clean Hydrogen Exists Today, and Air Products Only Needs to Capture a Small Share of This Market Green Hydrogen Europe Refinery Total Asia Clean Hydrogen Customers Demanding • Various leading companies have Hydrogen Demand (NH ) Market Clean Hydrogen Today 3 issued capacity requests that far exceed the capacity of our green ~12,700Tpd hydrogen project and the construction in NEOM • TotalEnergies’ RFQ accounts for • ~$100B Japanese government only 10% of gray hydrogen now subsidy scheme used by European refineries • Infrastructure grants with 1.2M • The output of our NEOM project MTA NH subsidy awarded in 2024 3 Remainder is less than 5% of the gray of Market ~90% • Co-firing another demand driver hydrogen used by European refineries A Blue Hydrogen • Asia Pacific is home to five of the • Louisiana capacity ~3MTPY, market top 10 biggest emitters globally, demand 15MTPY by 2040 cementing its crucial role in the TotalEnergies global energy transition ~10%• Targeting 20% NH co-firing, up to 3 RFQ 750 MW capacity through 1st bids in 2024 auctions • Blue hydrogen is a cornerstone of Japan’s and South Korea’s net- • Marine bunker fuel another demand NEOM <5% of Europe zero roadmaps driver Refining Market Sources: European Hydrogen Observatory, Energy Tracker Asia 28
3 Early Successes in Clean Hydrogen Projects, Underpinned by the Board’s Focus on Disciplined Capital Allocation and Risk Management Framework for Clean Hydrogen Strategy Several Early Successes ✓ Secure anchor customers for future clean hydrogen Stringent projects NEOM Green European Hydrogen Approach to ✓ Will not make any final investment decision on new projects until current facilities have 75%+ customer commitments Hydrogen Complex Capital Refueling Network ✓ In active discussions with equity partners and assessing Investment project financing for Louisiana project • World’s largest green-hydrogen-based • Support Daimler’s pioneering hydrogen truck ammonia production facility pilot project • Will produce up to 600 tons per day of • Develop a network of permanent, Onstream carbon-free hydrogen in the form of green commercial-scale hydrogen refueling stations ✓ NEOM construction is 60% complete; onstream by end of Dates on the ammonia as a cost-effective solution for to connect key locations across Europe 2026 transportation and industrial end markets Horizon ✓ Louisiana Blue Hydrogen onstream in 2028 • Strategically located along major globally transportation corridors near the Trans- • Air Products is the primary EPC contractor European Transport Network and system integrator ✓ ~35% of NEOM contracted on a take-or-pay basis, with negotiations underway for additional offtake which would Intense Focus exceed capacity on Contracted ✓ 60% of Canada committed, with negotiations underway for Offtake remainder of capacity Pioneering Green Hydrogen Agreement ✓ Active discussions for offtake from Louisiana • June 7, 2024, announced 15-year take-or-pay agreement to supply 70,000 tpy of green hydrogen ✓ World Energy SAF facility on hold until permits are received starting in 2030 to mitigate development risk Constant ✓ Not pursuing Northern Texas green hydrogen as it no • All 70,000 tpy will be used to decarbonize TotalEnergies’ European refineries Assessment of longer met target returns thresholds; sold development Project Risk• Air Products continuing discussions with TotalEnergies for green hydrogen supply to its other EU rights refineries Following Extensive Deliberation and Review, Air Products Announced Several Additional Steps to Ensure Disciplined Capital Investment Starting in August 2024 29
The Need to Invest in Our Future Growth and Value Creation Is Currently Masking Our Strong Underlying Performance Under Seifi Ghasemi’s Leadership and Prior to …Today We Are Investing Pre-Revenue for Future Value Creation, …Several Recent Key • The Board and Management have Investing Significant Capital Against Clean Hydrogen Which is Being Discounted by The Street and Therefore Presents a Actions Changed Our been responsive to shareholders Strategy, Total Shareholder Return Was Strong… Misleading Picture of the Strength of Our Business… Trajectory about clarity on our capital (A) (C) investment discipline, and the TSR Through January 1, 2022 TSR Through Unaffected Date TSR Through December 13, 2024 stock has responded positively Since Appointment Since Appointment 100 = L5Y L3Y L5Y L3Y L1Y YTD (B) (B) of Seifi Ghasemi of Seifi Ghasemi 6/30/2014 • We are already seeing momentum Air Products 207% 52% 20% Air Products 205% 138% 103% Air Products 19% 16% in our stock price as a result of 450 Peer Average 284% 121% 54% Peer Average 5% 4% Peer Average 156% 147% 80% several notable strategic S&P 500 30% 29% S&P 500 251% 112% 37% S&P 500 181% 133% 100% 400 announcements made since November 7 350 ꟷ Expect positive net cash starting in FY2027 300 ꟷ De-leveraging starting in 250 FY2027 200 ꟷ No new projects until existing projects are 75% committed 150 ꟷ Texas green hydrogen JV not 100 moving forward ꟷ World Energy SAF facility on 50 hold awaiting permits 0 ꟷ Announced two new Dec-19 Jun-20 Jan-21 Aug-21 Feb-22 Sep-22 Apr-23 Oct-23 May-24 Dec-24 independent director candidates (D) Peer Average S&P 500 Source: FactSet as of December 13, 2024 Note: Reflects TSR in USD based on daily currency conversion rate (A) Air Products’ significant investment into clean hydrogen began in 2022 30 (B) Since June 30, 2014 (one day prior to Mr. Ghasemi’s first day as CEO) Air Products Outperformed the S&P 500 on TSR (C) Unaffected date is October 3, 2024 (D) Includes Air Liquide, Linde and Nippon Sanso
Independent Research Analysts Have Been Positive on Air Products’ Strategic Direction “APD… is focused on signing offtakes for the existing “APD's 4Q exceeded expectations with a strong beat “We’ve seen a meaningful change in Air Products’ risk backlog. Combined with the commitment to not announce and set a guide in line with expectations (ex-LNG) and a tolerance on its clean hydrogen projects and new projects until 1) current projects are filled and 2) new low bar for F1Q. Management also took further commitment to succession planning, which we heard projects have offtakes, this goes a long way to actions to alleviate investor concerns — canceling as two significant areas of concern by investors (see our derisking APD's backlog. And as this backlog starts up TX green project, keeping SAF on hold until note) early in 2024. APD’s Board is also expecting to post FY25, this sets up for a multi-year period of, higher permitting is in place, emphasizing no new select a CEO successor within the next couple quarters. than peers, mid-teens EPS growth. Investors building projects without anchor contracts and providing We have long viewed APD’s base business as solid; confidence in execution and returns should drive a updates on its large projects. As APD delivers on these actions reinforce our constructive view.” further re-rating in APD.” its core business and executes on long-term - November 8, 2024 - November 18, 2024 projects, the stock should push higher.” - November 13, 2024 “[APD]’s expectation is to begin to be free cash flow “APD making thoughts known on its first mover “We expect these projects to deliver a +10% IRR (in positive by 2027, which answered a D.E. Shaw advantage in hydrogen…1) NEOM is 50% complete some cases materially higher), which doesn't account concern over ongoing negative cash flow generation expected on stream with first delivery early 2027; for the 45Q and 45V tax credits. We respect that project at an industrial gas company. It stated that going forward negotiations underway for NEOM volumes that would delays have been weighing heavily on investor no large project would be approved by the Air Products exceed the capacity of the facility, 2) 60% of Canada perceptions, but it's our sense that co messaging re: Board that did not have a 75% customer commitment. Net-Zero Hydrogen Project capacity is already timelines, off-takers, and Green/Blue H2 pricing is Air Products suggested that a new President would be committed, 3) Louisiana construction underway and air helping re-establish credibility. We believe APD's named…in the 2025 April/May time frame. The company permits expected in 2025, 4) President Succession valuation should steadily rise to the higher-end of its suggested that it was in active discussions with equity process is led by the Lead Director with support of the range due to improvements within the US and EMEA partners and assessing project financing for the Louisiana Board and search firm EgonZehnder – high qualified base businesses, better perceptions re: blue/green H2 project, which is also a set of steps in the direction of de- candidates identified and announcement expected demand/pricing, and recent CAPEX focus on North risking.” 1HF25.” America.” - November 7, 2024 - November 7, 2024 - November 7, 2024 Source: Wall Street Research. Permission to use quotes was neither sought nor obtained 31
Refreshed, Independent and Fit-for-Purpose Board to Oversee Our Strategy 32
Our Proposed Board Is World-Class and Has the Right Skillsets Our recently refreshed, fit-for-purpose Board slate includes 6 of 9 directors nominated in the past 5 years, including 2 new nominees; in addition, while at Pershing Square, Paul Hilal supported the hiring of our CEO and Lead Independent Director on our Board Jessica Trocchi Tonit M. Calaway CN CN MC AF Graziano E L xiec sa A uti.ve Da Vv ic is e AF Wayne T. Smith Lisa A. Davis Senior Vice F Pr oesi rmd er en Me t, C m hb ief er Retired Chairman Former Member EX EX EX MC CN President and o A f d th m e in Man istra atg ive ing and Chief of the Managing MC Chief Financial B Off oar ic der a,n G den CE er O ao l f Executive Officer Board and CEO of MC CN EX Officer of United G C ao s ua n n sel d Po , an wer d of BASF Gas and Power States Steel for Sec Sir em eta en ry s oA f G Corporation for Siemens AG Corporation BorgWarner Inc. Appointed 2023 Appointed 2022 Appointed 2021 Appointed 2020 Significant Legal / Regulatory, Extensive Financial Leadership Accomplished Executive in the Experience Leading World- Experience Leading World- Human Resources, and Corporate Experience and Operational Chemicals and Industrial Scale Energy Projects Scale Energy Projects Governance Expertise Expertise Manufacturing Sectors Pershing Square / Paul Hilal Originally Pershing Square / Paul Hilal Originally New Nominee for the 2025 AGM New Nominee for the 2025 AGM Supported Appointment Supported Appointment CN MC MC AF Alfred Stern EX Seifollah ( Seifi ) Edward L. Monser Charles Cogut Ghasemi Lead Independent Bhavesh V. Chief Executive EX CN AF CN Chairman, President, Director (“Bob”) Patel Officer and Retired Partner, and Chief Executive MC Former President of Chairman of the Simpson Thacher & Retired President Standard Industries Executive Board of Bartlett LLP Officer of the and Chief Operating OMV Company Officer of Emerson Electric Co. Appointed 2015 Appointed 2013 Appointed 2013 Leading Corporate Lawyer with Seasoned Executive in Industrial Significant Experience in Significant Global Chemical Extensive International Business Multi-Jurisdictional M&A Gases & Specialty Chemicals Industrial Operations and Supply Industry Experience and Management Experience and Chain Optimization Expertise Industries Corporate Governance Expertise Innovation Expertise AF = Audit and Finance Committee MC = Management Development & Compensation Committee = New Nominee CN = Corporate Governance & Nominating Committee = Committee Chair = Appointed in past 5 years EX = Executive Committee Notes: Current directors David Ho and Matthew Paull have determined not to stand for re-election. Committee designations reflect composition effective following the upcoming Annual Meeting subject to election 33
Recent Highly Qualified Nominees Are Well Equipped to Guide Air Products Through Its Next Stage of Growth As the Company advances its clean hydrogen strategy and moves from business development to execution, Bob and Alfred bring extensive large-scale project execution experience that the Board prioritized when evaluating potential new director candidates The Board’s refreshment strategy reflects its Bhavesh V. (Bob) Patel Alfred Stern robust selection criteria geared toward Independent Director // Nominated for 2025 AGM Independent Director // Nominated for 2025 AGM driving value for shareholders Age: 57 Age: 59 • In November 2024, the Board nominated Bob Patel and Alfred Stern, seasoned Former CEO of W.R. Grace and LyondellBasell and Former Chief Executive Officer and Chairman of the Executive Board President of Standard Industries of OMV Aktiengesellschaft executives with experience leading major publicly listed industrial • Has 35 years of industry experience in manufacturing, • Brings more than 30 years of international experience leading companies commercial and management roles, as well as in the global energy, refinery, and chemical industry initiatives in Europe, the commodity markets. His experience in global commodity U.S., the Middle East and Asia, spanning research and • They bring executive and public company markets adds insight into the Board’s discussions of international development, sales and marketing, and operations/quality and board expertise, deep knowledge of the operations, strategy, and risk business management industrials sector, experience running • Brings executive leadership skills, public company board • Has successfully initiated and led significant international, complex cross-border organizations and experience, capital markets, and financial expertise, extensive multi-billion-dollar growth projects including organic a long track record of managing large- Middle East joint venture experience, and safety expertise investments, M&A, and joint ventures scale growth projects and seizing on opportunities related to the energy • Has led complex global organizations such as W.R. Grace, • Under Mr. Stern’s vision and leadership, OMV is transitioning to transition Chevron Phillips Chemical Co. and LyondellBasell through large become an integrated sustainable chemicals, fuels and energy scale restructuring and organic growth with a focus on long- company, with a focus on innovative circular economy solutions • Both director nominees have stellar term shareholder value creation • Was instrumental in growing the joint venture Borouge in the records growing major industrial • Developed a strong track record of disciplined capital Middle East ninefold during 14-year tenure at Borealis companies internationally and capitalizing allocation while serving as CEO of LyondellBasell on clean energy and sustainability opportunities 34
Robust, Ongoing Nomination Process Led to Addition of New 2025 Independent Director Nominees • In November 2022, Air Products began a Board search for candidates who brought global CEO experience with a strong technical understanding of the technologies and science that underscore Air Products' business. Additional criteria screened for in this process focused on capital intensive process industries (oil & gas, chemicals, energy, or mining end markets), experience with financing and executing large Most Recent Process capital projects and interest and experience in the energy transition and sustainable technologies Launched in 2022 • Throughout the refreshment process, search criteria was driven by the Board’s robust self-evaluation process, which is established annually by our Corporate Governance and Nominating Committee; the evaluation process identified the particular skillsets and qualifications that would be most additive to the composition of the Board as Air Products continues its expansion into clean hydrogen • A third-party search firm screened ~600 candidates across the globe, ultimately profiling approximately 45 candidates for consideration. Seven Over 600 Candidates Screened candidates were engaged and interviewed throughout this process, with five progressing to final stage interviews with the full Board This thorough process resulted in the nomination of Alfred Stern and Bob Patel, two highly qualified individuals with unique • Two New World skillsets that the Board determined best align with Air Products’ go-forward strategy Class Nominees – If Mr. Patel and Mr. Stern are elected, six of nine directors will have been added in the last five years • The Corporate Governance and Nominating Committee has been deeply focused on a regular, ongoing Board refreshment – In March 2020, the Corporate Governance and Nominating Committee appointed Lisa Davis and engaged a third-party search firm to find Appointments candidates who brought CEO experience, resulting in the placement of Wayne Smith in August 2021. The second search focused on C- Followed a Level executives with prior experience who expanded the Board’s diversity, resulting in Tonit Calaway’s appointment in 2022. The third Refreshment Process search focused on CFO experience and ultimately resulted in the appointment of Jessica Graziano in 2023 Launched in March 2020 – Prior to each of these appointments, the Company’s search firm screened approximately of 500+ candidates, with a range of 25-50 candidate profiles reviewed for fit with Air Products. A range of three to five prioritized candidates were interviewed in each process, with finalist candidates being met by the entire Board prior to joining 35
Experienced and Effective Lead Independent Director Highly Independent Board with Robust Oversight Experienced and Effective Lead Independent Director Whose Appointment Was Previously Supported by Paul Hilal • Has more than 30 years of experience leading global engineering Ed Monser is “the kind of truly Edward L. Monser organizations through strategic change, guiding Emerson’s footprint expansion and push to strengthen its global position Independent Director // independent, high-integrity, and Lead Director since 2021 shareholder-oriented director • Drawing on his extensive career, Mr. Monser brings strong Committees: Chair of the understanding of industrial operations, supply chain optimization, Corporate Governance and nominee that we think can best serve and continuous improvement Nominating Committee, member (A) shareholders” of the Executive, and Management Development & • Has extensive experience in international business operations, Compensation Committees particularly in emerging markets, as well as a demonstrated - Paul Hilal in an October 2024 letter capability in strategic planning and organizational development Retired President and COO of Emerson Electric Co. to the Board of Air Products Independent Board Oversight with Chairman and Lead Independent Director Previously Supported by Paul Hilal / Pershing Square • Lead Independent Director role has robust responsibilities • All directors other than our CEO are independent – Presiding at executive sessions of the Board and any other time the Chairman is not present and • All members of standing committees are independent; independent directors make final communicating feedback to the CEO compensation decisions pertaining to executive officers – Determining the agenda for executive sessions of independent directors• The independent directors regularly meet without the CEO and other members of management in executive sessions that are scheduled to occur at most Board meetings – Possessing the principal authority to convene a meeting of independent directors – The CEO’s performance review is conducted in executive session and the Board committees – Serving as a liaison between the independent directors and CEO regularly meet in executive session – Is regularly apprised of inquiries from shareholders and involved in correspondence responding to • The Board and each standing Board committee have an established and robust self-assessment these inquiries, when appropriate process that is conducted on an annual basis – If requested by shareholders or other stakeholders, ensures that he is available, when appropriate, – Self-assessments are conducted and discussed annually, including both a retrospective for consultation and direct communication with such shareholders assessment of Board and committee performance and a prospective discussion focused on improving Board process and efficiency (A) Permission to use quotes was neither sought nor obtained 36
Commitment to High Standards of Corporate Governance and Shareholder Rights Governance Highlights 10% holding requirement for Annually elected Board ✓✓ shareholders to call a special meeting Majority vote standard to Majority vote standard to elect directors ✓✓ amend charter and bylaws One-share, one-vote standard Extensive shareholder engagement program ✓✓ All directors in compliance with stringent Proxy access ✓ ✓ stock ownership guidelines (A) Board Best Practices Management Board Committee Chairs 89% 4.6 years 56% Announced in July 2024 All Refreshed Since 2020 Independent Average Tenure Diverse Brings together talented senior leadership across the globe to Refreshed Chairs of all three execute the Company’s two-pillar standing committees of the Board 2 New Director Nominees growth strategy, streamlining our 8 Independent 5 Diverse since 2020 organization, and enhancing our 4 Director Nominees with 1-5 Years 1 Not Independent 4 Other ability to execute our full portfolio of 3 Director Nominees with 5+ Years projects (A) Reflects post-Annual Meeting Board composition of Company nominees including Bob Patel and Alfred Stern and excluding retiring directors 37
Proactive and Thorough CEO Succession Process Succession Update Robust Search Process • President search announced in August 2024, prior to D.E. Shaw’s or • The process is led by our Lead Independent Director with the support of Mantle Ridge’s involvement, although search process had begun two and the full Board and an independent search firm a half years ago • Director feedback informed search criteria, which includes public company ─ This was a dual-track process to explore internal and external CEO and international experience candidates ─ The Board views public company CEO experience as a critical factor in looking for a successor given the scale of Air Products; the Company • The President will also sit on the Company’s Board must be led by a leader fully equipped with the necessary experience to run a multibillion-dollar global public company • Anticipate announcement of new President and related timeline for CEO succession no later than March 31, 2025 • Search process has included 1,000+ candidates screened across the globe, with over 300 evaluated for potential fit • The search process is ongoing, with five prioritized candidates who • 25, 29, and 30 candidates were discussed with the Board at three have been assessed fully and are in the course of being presented to the meetings, respectively, every six months between July 2023 and July 2024 full Board 38
Further Aligning Executive Compensation with Value Creation and Maintaining Accountability Following Extensive Shareholder Engagement Prior to the 2024 Annual Meeting, both management and the Chair of the Management Development and Compensation Committee participated in a number of meetings with shareholders to discuss the executive compensation program. Following the 2024 Annual Meeting where say-on-pay support was ~73%, management engaged with shareholders representing ~48% of our outstanding shares. Based on the feedback we received and our continuing review of sound compensation governance practices, we have taken meaningful actions. (A) Actions Taken in Response to Shareholder Feedback Majority of Compensation Tied to Shareholder Value CEO Target Other NEO Target • Beginning in FY2025, raised the target performance goal for 100% payout of Compensation performance shares to require above-market performance to earn a target payout Base Annual Incentive Long-Term Incentives Changes— 91% Increased Rigor in • Beginning in FY2025, capped performance share payouts at 100% if absolute TSR is 81% Long-Term negative over the applicable performance period to eliminate possibility of above- At-Risk Pay At-Risk Pay Incentives target payouts when absolute TSR is negative (Performance Shares) • Performance shares awarded as long-term incentives beginning in FY2026 will include a return measure, in addition to TSR, relative to the S&P 500 9% 19% 13% • Added proxy disclosure on alignment of compensation outcomes with financial performance Increased Transparency 19% • Expanded disclosure on progress toward our ESG goals and the design and application of ESG modifier in the Annual Incentive Plan 78% 62% • For executive officers, the Committee can apply discretion for the achievement of Reinforce ESG objectives Accountability on Project Execution • For the larger organization covered by the Annual Incentive Plan (not including Within the Annual executive officers), the Committee and CEO have discretion under the Adjusted Incentive Plan EBITDA metric to reflect performance on project execution goals Long-term Incentives Comprised of 60% Performance Shares & 40% Restricted Stock Units Recent changes ensure that the compensation program furthers the strategic plan, maintains accountability over management, and incentivizes value creation and prudent clean hydrogen investment (A) Reflects components of total direct compensation for FY2024 39
Mr. Ghasemi’s Employment Agreement • In May 2023, the Board amended Seifi Ghasemi’s employment agreement, further extending his term ─ The agreement initially extends Mr. Ghasemi’s employment term to September 30, 2028. On September 30, 2024 and each year thereafter, the contract term automatically renews to be a five-year term unless either party terminates the agreement at the latest, four years ahead of its then expiration date • While the agreement has a five-year stated term, which provides management continuity that has been important for long-term development projects and customers, Mr. Ghasemi can be terminated by the Board at any time, and would only be entitled to cash severance if he is terminated during the initial five- year term. If he is terminated during this initial five-year period, absent a change in control, the severance multiplier is 2x annual cash compensation and not tied to the remaining years of the term. If he is terminated after the initial five-year term there is no cash severance • The agreement should be considered in context. Mr. Ghasemi has led the Company’s transformation into the world’s most profitable industrial gases company (A) based on Adjusted EBITDA margin , and the Board is highly committed to a thoughtful CEO succession process (B) • Mr. Ghasemi’s leadership has transformed Air Products by creating more than $44B of shareholder value , as he has grown the core industrial gases business and set the stage to extend into clean hydrogen • Under Mr. Ghasemi’s leadership, Air Products has successfully executed several mega projects – with overall returns across these projects exceeding our target ─ Gasification joint venture with Lu'An Clean Energy Company ─ Gasification and power joint venture in Jazan Economic City ─ Agreement with the Republic of Uzbekistan and Uzbekneftegaz JSC to acquire a $1B natural gas-to-syngas processing facility (A) Non-GAAP financial measure. See appendix for reconciliation 40 (B) Based on $25.2B market capitalization on June 30, 2014 (one day prior to first day as CEO) and December 13, 2024
Without Any Serious Plan for Value Creation, Mantle Ridge Seeks to Replace Air Products’ Board Leadership with Inferior Nominees with Questionable Independent Thought 41
Mantle Ridge Seems Determined to Seize Control of the Company’s Leadership and Appoint its Handpicked Management Mantle Ridge Is Attempting to Enact its Value-Destructive Playbook • Mantle Ridge is attempting to seize control of Air Products by seeking to replace our Lead Independent Director, fire our CEO, replace the executive team, and halt our strategy that is on track to create substantial long-term shareholder value, without any viable alternative for growth. This is despite Mantle Ridge privately praising Mr. Ghasemi and Mr. Monser in interactions with the Board • This is their standard playbook, known well by three of our current Board members, not a solution selected to address the Company’s specific situation. In fact, since its founding, Mantle Ridge has never run an activist campaign or made a CEO change that has driven outperformance. Without any credible plan, we believe Mantle Ridge’s actions will derail our clean hydrogen strategy and destroy shareholder value Mantle Ridge’s Behavior Provided No Basis for Reasonable Engagement • An ad-hoc committee of independent directors held a 4 hour in-person meeting with Mantle Ridge less than a week after learning of their investment to better understand Paul Hilal’s plan for the Company. Mantle Ridge came ill-prepared with no formal presentation and focused the discussion on taking control of the Board and replacing a majority of the management team, including removing Mr. Ghasemi as CEO as soon as possible. Specifically, Mantle Ridge proposed replacing Mr. Ghasemi with Dennis Reilley for just a few months during a search for a permanent CEO, despite Mr. Reilley not having served in an operating role in over 17 years or on a public board in nearly 6 years • When directors questioned the choice of Mr. Reilley given his lack of recent experience and the potential instability of appointing an interim CEO for just a few months instead of the Board completing its ongoing succession process, Mantle Ridge changed course, and sent a letter to the Board, several days later, proposing that the Board consider a CEO candidate, supported by a more seasoned executive chairman. Several days after that, it was leaked to the media that Mantle Ridge’s CEO candidate would be Eduardo Menezes, who has never served as a public company CEO, with Mr. Reilley as Executive Chairman • The Board concluded that Mantle Ridge’s choice of successors to Mr. Ghasemi were deeply troubling and called into question Mr. Hilal’s judgment and preparation in seeking control of Air Products. It led the Board to conclude that further engagement with Mantle Ridge would be fruitless and the best course of action was to let shareholders decide the Company’s direction Mantle Ridge’s Nominees are Inferior to Air Products’ • We believe Mantle Ridge’s nominees have been selected solely because of their willingness to support Mr. Hilal and his short-term agenda and not because their experience is superior to or more relevant than our existing nominees. This seems apparent because of the nominees’ pre-existing relationships with Mr. Hilal or reliability as previous activist nominees • Mr. Reilley has a longstanding relationship with Mr. Hilal, including history serving as a two-time Mantle Ridge candidate in proxy contests and via a consulting agreement with Mantle Ridge; Mr. Evans and Ms. McKibben have both served as prior activist nominees • We believe shareholders should be concerned that the relationships between Mr. Reilley and Mr. Hilal would preclude them from exercising their independent judgment and generating long-term value for shareholders 42
Since Paul Hilal Started Mantle Ridge, He Has Deployed a Similar Value- Destructive Playbook in 3 Successive Campaigns Since its Founding, Mantle Ridge Has Never Run an Activist Campaign or Made a CEO Change That Has Driven Outperformance (A) (A) (A) TSR vs. S&P 500 Since Mantle Ridge Settlement: (104)% TSR vs. S&P 500 Since Mantle Ridge Settlement: (69)% TSR vs. S&P 500 Since Mantle Ridge Settlement: (89)% Mantle Ridge placed a CEO candidate at CSX who was known to be unwell, and passed away within months of his appointment – CSX shareholders After Mantle Ridge announced its stake, the Company announced its Mantle Ridge gained control of the Board and inserted its handpicked funded the CEO’s obligation to reimburse Mantle Ridge for compensation CEO would resign; Mantle Ridge then settled with the Company to executive as the new CEO. In less than two years, that CEO resigned, benefits, totaling $84 million; Mantle Ridge has sold almost its entire appoint directors including Paul Hilal as Vice Chair and a new CEO and the share price fell by 55% position in CSX, but Paul Hilal remains on the Board (B) (C) (D) TSR Indexed to 100 TSR Indexed to 100 TSR Indexed to 100 130 300 170 Aramark S&P 500 CSX S&P 500 Aramark announced it entered into an agreement with Mantle Ridge, Dollar Tree S&P 500 pursuant to which the Board size increased from 10 to 11 and 5 Mantle Ridge CSX announced it entered into an agreement with Mantle 150 designees were added immediately to the Board; the Company replaced its 250 Ridge, pursuant to which 5 Mantle Ridge designees were CEO with a Mantle Ridge designee (John Zillmer), added a Vice Chairman (Paul 42.8% 120 added to the Board of 13 directors, including the CEO Hilal), as well as added an additional director at the 2020 AGM (Hunter Harrison) and Vice Chairman (Paul Hilal) CEO of Dollar Tree was 130 Aramark and Mantle Ridge agreed to expand the replaced 14.4% size of the Board from 11 to 12 to nominate an 200 unanimously supported director at the 2021 AGM 110 110 61.9% Dollar Tree 7.5% announces 150 CEO 90 resignation 100 100 (1.2%) 70 Dollar Tree entered into an agreement with Mantle 90 50 50 Ridge, pursuant to which the Board size increased CSX announced that its CEO, Mantle Paul Hilal resigned from his Vice Chairman from 11 to 12 and 7 Mantle Ridge designees were Ridge designee Hunter Harrison, was role and the Board added to the Board on medical leave; later that weekend, (54.5%) Mr. Harrison passed away 30 0 80 Mar-17 Jun-17 Sep-17 Dec-17 (A) TSR reflects dividend-adjusted total return percentage as of December 13, 2024 43 (B) TSR reflects dividend-adjusted total return percentage as of December 15, 2017 (C) TSR reflects dividend-adjusted total return percentage as of August 9, 2023 (D) TSR reflects dividend-adjusted total return percentage as of November 4, 2024
Mantle Ridge’s Slate Is Highly Conflicted We believe Mantle Ridge nominees have been selected not because their experience is superior to or more relevant than our existing nominees, but rather because of pre-existing relationships with Mr. Hilal or reliability as a previous activist nominee Nominee Contextual Commentary Paul Hilal• Assembled a dissident slate with whom he has deep and clear ties and connectivity to the broader activist community Previous Andrew Evans• Former activist nominee for Carl Icahn at Southwest Gas Activist Tracy Nominee Tracy • Tenure as a director at Ecolab overlaps with former Mantle Ridge nominee McKibben Dennis Reilley McKibben Jonathan Zillmer; Mr. Zillmer was appointed via Mantle Ridge campaigns both as a director at CSX along with Mr. Reilley and as CEO at Aramark • Former activist nominee for Clinton Group at Gleacher Mantle Ridge • Launched proxy contest at Arlington Asset Investment with Clinton Group while Board overlap Association / a director at Imation with Jonathan Consulting Zillmer Agreement Dennis Reilley• Former Mantle Ridge nominee at CSX and Dollar Tree (Chair • Party to a two-year consulting agreement with Mantle Ridge expiring in Candidate) 2026 to “advise on industry matters” at an hourly cash fee of $1,000 an hour CSX • Joined CSX Board in connection with Mantle Ridge’s settlement with the Corporation Linde plc / Company in 2017 along with Paul Hilal Praxair • Tenure at Praxair overlapped with Mantle Ridge preferred CEO Candidate, Mr. Menezes • Has not held an executive position in over 17 years since retiring in 2007 • Has not sat on a public Board in nearly 6 years since resigning from directorships Andrew Evans Eduardo • Tenure at Praxair overlapped with Mantle Ridge Chair candidate, Mr. Reilley Menezes (CEO • Not even nominated as a director candidate despite being proposed as CEO Paul Hilal Candidate) Eduardo All but 2 candidates on Mantle Ridge’s original 9-person slate had prior personal Menezes connections with Hilal / other nominees or a history of being an activist nominee; neither of Mantle Ridge CEO Candidate these 2 unconflicted candidates remain on the slate 44
Mantle Ridge’s Proposed Executive Chairman Candidate Appears Alarmingly Unfit to Lead Air Products or Any Public Company There are deeply concerning questions about whether Mr. Dennis Reilley, as a director of three companies, reportedly leaked confidential information about those companies, in one case about merger negotiations, with a third party. This calls into question his fitness to serve on any public company’s board of directors and raises questions about Paul Hilal’s judgment in nominating him to our Board Paul Hilal Wants to Turn Over the Board and the Company to Mr. Reilley’s TRANSCRIPT FROM A 2019 COURT HEARING APPROVING A GUILTY PLEA BY JOHN DAVIDSON IN CONNECTION WITH PROVIDING A FALSE Leadership, Despite Mr. Reilley’s Apparent Inability to Comply With His STATEMENT TO THE FBI Basic Duty of Confidentiality as a Director MS. ANDERSON [Assistant U.S. Attorney]: And he provided you with • Multiple media reports have reported that Mr. Reilley leaked confidential board information to a friend, nonpublic information he had received from all three of those boards, John Davidson, about the 2014 sale of Covidien, where he was a director, according to testimony of Mr. correct? Davidson who pled guilty to lying to the FBI about who he received information from THE DEFENDANT [John Davidson]: Yes, ma'am. • In reviewing a Federal plea agreement signed by Mr. Davidson, in 2019, Mr. Davidson admitted to making a false MS. ANDERSON: And he forwarded emails he received as a board member? statement to the FBI that he had never received from “D.R.” any non-public information, which D.R. had acquired THE DEFENDANT: Yes, ma’am. (A) as a result of his position on the boards of directors of Marathon Oil, DowDupont, or Covidien. The plea […] agreement used the initials “D.R.” only when referring to the director in question and Mr. Reilley was not named directly in the complaint MS. ANDERSON: You had, in fact, received nonpublic information from D.R. that he had acquired from his board work at Covidien, Marathon, and Dow, • In an SEC enforcement action against an associate of Mr. Davidson, John Special, who was found liable and correct? (B) ordered to pay nearly $3 million for allegedly trading on the basis of the information leaked by Mr. THE DEFENDANT: Yes, ma'am. Davidson, Mr. Special claimed to have received material, non-public information from a “Director” who served on the Boards of Covidien, Marathon Oil and DowDuPoint, including, in the case of Covidien, Transcript dated March 5, 2019 – Mr. Reilley resigned from the board of regarding a proposed transaction between Covidien and Medtronic. We note that Mr. Reilley was not named Marathon Oil in February 2019 and from the boards of DowDuPont and directly in the SEC’s complaint CSX in December 2018 • Notably, before news of the plea agreement and SEC enforcement action became publicly known, Mr. Reilley resigned as director of CSX (to which he had been appointed by Mantle Ridge) and DowDupont (both in “But this will be disqualifying in many investors’ eyes, and it’s hard December 2018), and as chairman of Marathon Oil (in February 2019), the latter two of which were to see how Mantle Ridge — which says it knew about the allegations companies from which Mr. Reilley reportedly leaked confidential information as a director before it nominated Reilley — got comfortable.” – A respected financial publication, “Board nominee in Air Products activist fight was accused of • Mr. Reilley has not served on a public company board in the nearly six years since these resignations and (C) tipping off friend to merger a decade ago” the public disclosure of his reportedly having leaked confidential information to Mr. Davidson who had traded on that information 45 (A) United States of America v. John Kenneth Davidson, Case No. 19-cr-56, filed on February 25, 2019. Transcript Dated March 5, 2019 (B) Securities and Exchange v. Special et al, Case No. 19-cv-1152, filed on December 12, 2019 (C) Liz Hoffman, Semafor, December 13, 2024
Mantle Ridge’s Preferred CEO Candidate Is Insufficiently Qualified Eduardo Menezes Lacks The Basic Qualifications We Look For in CEO Candidates We believe Mantle Ridge is determined to seize control of Air Products’ leadership and use this control to either severely curtail or eliminate our growth strategy, which Mr. Menezes does not have any public is working, in order to generate a short-term return Company C-suite or public Company Board experience By proposing an insufficiently experienced CEO candidate like Mr. Menezes, Mantle Ridge has clearly demonstrated that it has no interest in conducting a • Eduardo Menezes lacks the experience necessary to serve as CEO of thoughtful succession process, but rather, appears more Air Products, having never held a C-Suite role or served on the Board at a interested in terminating a successful and well- respected CEO (whose appointment Paul Hilal / public company, a key criterion Air Products looks for as part of the Pershing Square supported 10 years ago) in favor of a rigorous selection process to determine the next President and future hand-picked, underqualified candidate that will do Mr. Hilal’s bidding CEO of Air Products In contrast to Mantle Ridge’s inadequate CEO candidate • Mr. Menezes possesses no significant employment experience outside who fails to meet basic search criteria, Air Products has of his tenure at Linde and the Company’s predecessors and subsidiaries already identified several candidates who are of superior caliber and experience, well-known to • Mr. Menezes left his role at Linde in 2021 after being passed over for investors, and are current or former public company the CEO role; he has not held any other operational role since leaving CEOs with significant international experience and relationships Linde almost 4 years ago 46
Mantle Ridge Would Remove a Successful Executive Leader Amid a Thorough Succession Process Currently Underway Seifollah (“Seifi”) Ghasemi Dennis Reilley Chairman, President and Chief Executive Officer Mantle Ridge Chairman Nominee ✓ Appointed as CEO in 2014 after Pershing Square / Paul û Has not held an executive position in over 17 years Hilal supported his appointment to the Board as a since retiring in 2007 global leader of inorganic specialty chemicals and û Has not sat on a public Board in nearly 6 years since advanced materials businesses resigning from three directorships shortly before news ✓ Significant industry executive experience, including as reports surfaced that he was being investigated by the former CEO of Rockwood Holdings, a global leader in (C) FBI for insider trading lithium and advanced materials, and leadership roles at û Longstanding relationship with Paul Hilal including his GKN, a global industrials company ✓ Significant shareholder in tenure on the CSX Board and serving as a nominee of û Owns no shares ✓ Leadership has transformed Air Products by creating Air Products, with stake Mantle Ridge in its activist fight at Dollar Tree in Air Products (A) (B) totaling ~$239 million more than $44B of shareholder value , leading the û Has a two-year consulting agreement with Mantle industry with organic sales growth, margin expansion, ✓ Incentives highly aligned Ridge, misaligning his interests from those of Air with shareholders EPS growth, and the development and implementation Products’ shareholders of a Five-Point Plan to guide future success Highly Respected Executive in Industrial Gases & Media Reports Raise Serious Questions Regarding Whether VS Specialty Chemicals Mr. Reilley Repeatedly Leaked Confidential Board Materials Selected Experience Mantle Ridge’s Founding Member of Trian Advisory Candidate at: Partners; Publicly Supported Activist Trian’s Activist Campaigns at: Chairman and CEO Leadership Including Director of the Leadership Including Director Director Main Board of GKN and Chairman and of the Main Board of BOC CEO of GKN Sinter Metals Group, President of BOC for Hire Gases Americas, and Chairman and CEO of BOC Process Plants Board Director Board Director (A) Ownership value based on APD share price as of December 13, 2024 (C) Nolan Clay, The Oklahoman, February 27, 2019, “FBI insider trading probe results in criminal charge in 47 (B) Based on $25.2B market capitalization on June 30, 2014 (one day prior to first day as CEO) and Oklahoma City federal court“ December 13, 2024
Mantle Ridge Would Remove Our Lead Independent Director’s Significant Operating and Supply Chain Expertise Edward L. Monser Paul Hilal Lead Independent Director of Air Products Mantle Ridge CEO and Nominee û No industry experience with the board or operations of an ✓ Appointed as director in 2014 with support from Pershing Square / Paul Hilal industrial gas or chemicals company ✓ Over three decades of experience leading global û Track record of value destruction and mismanaged engineering organizations through strategic change, succession processes at all of Mantle Ridge’s major activism including as President and Chief Operating Officer at Emerson Electric, guiding the Company’s footprint expansion and push campaigns – Aramark, CSX, and Dollar Tree, overseen from Vice to strengthen its global position Chairman role at all three companies ✓ Strong understanding of industrial operations, supply û Either was not aware of or did not care about alleged insider chain optimization, and continuous improvement trading probes involving Dennis Reilley, which demonstrates ✓ Extensive experience in international business lack of judgment and care for corporate governance and ethics operations, particularly in emerging markets Significant Experience in Industrial Operations No Relevant Industry Experience Coupled With a VS and Supply Chain Optimization Track Record of Value Destruction at Mantle Ridge û Dissident director slate appears assembled largely based on previous relationships Ed Monser is “the kind of truly independent, and activism involvement as opposed to fit-for-purpose recruitment high-integrity, and shareholder-oriented director nominee that we think can best serve û Every Mantle Ridge candidate has served on an activist’s dissident nominee slate in (A) shareholders” one or more contested proxy situations and Mr. Reilley has a longstanding relationship with Mr. Hilal - Paul Hilal in an October 2024 letter to the Board of Air Products û Under his board oversight, CSX said in October 2024 it had received a subpoena from the Securities and Exchange Commission over an accounting restatement, as well as (B) Track Record of Value Creation information requests about some of the company's performance metrics (B) Track Record of (104)% (69)% (63)% Value Destruction +776% +112% +34% TSR relative to the S&P 500 during his Board tenures TSR relative to the S&P 500 during his tenures (A) Permission to use quote neither sought nor obtained 48 (B) Reflects dividend-adjusted total return percentage over tenure or as of December 13, 2024 for current positions
Mantle Ridge Would Remove Significant Legal and M&A Expertise Charles Cogut Tracy McKibben Independent Director of Air Products Mantle Ridge Nominee û Appears to have significantly less legal experience than ✓ Recognized as one of the most prominent leading Mr. Cogut corporate lawyers in the United States ✓ Spent 39 years at Simpson Thacher & Bartlett LLP where û Energy experience via advisory work at MAC Energy Group he specialized in domestic, international, and cross- is duplicative given Lisa Davis and Alfred Stern’s significant border mergers and acquisitions, other contests for energy expertise corporate control and corporate governance matters û Public Board experience includes involvement in ✓ Previously served as a director of The Williams controversial activism campaigns Companies, Inc. Leading Corporate Lawyer with Multi-Jurisdictional VS Less Relevant Experience Than Targeted Directors M&A Expertise Former Activist Nominee Governance / Ethics Issues Named among ten “Most Highly Regarded “The Best of the Best” Individuals” by the Clinton Group’s M&A Lawyers, 2011 Named a “Senior International Who’s Who of Tenure as a director at Ecolab Deal Maker of the Year Candidate At: While a director at Imation, Statesman” in the Merger & Acquisition 2008 and 2010 includes numerous class action “The Best of the Best” practice areas of Lawyers, 2010, and the McKibben appears to have allowed Private Equity and Corporate-Mergers & International Who’s Who of lawsuits pertaining to wage and the company to be used as a shell Corporate Governance Acquisitions and Private Corporate Governance hour violations resulting in $50 Lawyers, 2012 Equity/Buyouts, 2012 Lawyers, 2011 by hedge fund Clinton Group for million in settlement payments; an unsuccessful activist campaign, Ms. McKibben currently sits on the drawing criticism from ISS and While a Director at Compensation & Human Capital Imation, Launched Proxy Glass Lewis, who criticized Imation Selected Transaction Advisory Experience Management Committee Contest with Clinton heavily for engaging in related-party Tenure also overlaps with Group At: transactions with Clinton that they former Mantle Ridge nominee said served to enrich the latter. While / / / Jonathan Zillmer; Mr. Zillmer was McKibben was a director, Imation appointed via Mantle Ridge ultimately delisted and its share campaigns both as a director at price fell to a low of $0.75 CSX and as CEO at Armark 49
Mantle Ridge Would Remove Critical Energy and Renewables Expertise Lisa A. Davis Andrew Evans Independent Director of Air Products Mantle Ridge Nominee ✓ Ms. Davis brings 35 years of experience leading û Public C-Suite and Board experience limited to U.S. companies large, multi-faceted international businesses, û Oil and gas industry credentials and renewable energy project particularly within energy and manufacturing experience pale in caliber to those of Lisa Davis industries and with a focus on overseeing and implementing world-scale energy projects û As CFO of Southern Co between 2018 and 2021, Evans oversaw the finances of the Vogtle nuclear power plant expansion ✓ She has served on public boards in the U.S. and project, which was plagued by construction delays and cost Europe, providing the Board with a solid understanding overruns. The project, which was supposed to herald a of these jurisdictions and considerations when nuclear power revival in the United States, was 7 years late implementing complex projects, which represent an and $17B over budget important and growing portion of our business Extensive Experience Leading World-Scale Energy Projects, Less Relevant Experience Than Targeted Directors VS Including Renewables Selected Experience Former Activist Governance / Ethics Issues Nominee Member of the Managing Board for Siemens AG; CEO of Siemens Gas and Power; CEO and Chair of Siemens Executive Vice President, Strategy, Corporation USA; Member of the Portfolio & Alternative Energy of Board of Directors of Siemens Board Director Royal Dutch Shell, UK Gamesa Renewable Energy SA Previous Board appointment Tenure as CFO at AGL involved a regulatory action and class action lawsuit filed against via activism by Icahn at an AGL subsidiary over allegations the Southwest Gas has resulted company overcharged customers for both in ~(75)% TSR vs. the S&P 500 natural gas and for customer service charges (A) over his tenure Board Director Board Director Board Director (A) Reflects dividend-adjusted total return percentage over tenure or as of December 13, 2024 for current positions 50
Mantle Ridge’s Proposed Changes Will Destroy Our Trajectory Toward Long-Term Value Creation 51
Air Products is Already Taking the Steps Necessary to Generate Significant and Sustainable Shareholder Value Demands or Claims Air Products’ Board & Management Actions From Mantle Ridge Accelerate efforts to de-risk existing large project ✓ Recently executed long-term agreement for downstream distribution with TotalEnergies commitments by signing offtake agreements at ✓ Project returns are consistently re-evaluated against Air Products’ targets reasonable return hurdles ✓ Target >10% IRR threshold for new projects, in-line with public peers Tie future capital investment to offtake agreements, consistent with well-established ✓ Air Products will not announce a future project without an anchor customer committed on a long-term basis practice in the industrial gas sector ✓ Assuming project finance goals are met, capex after project finance funding sources is expected to reduce Capex-to-sales to return to to normalized levels by FY2026 normalized levels beyond FY2026✓ Continuing to seek alternative funding sources to reduce annual capex ✓ We expect positive net cash starting in FY2027 ✓ President search announced in August 2024 although executive search firm was engaged since January 2023 Communicate a clear, credible, and transparent ✓ Anticipate announcement of new President and related timeline for CEO succession by March 31, 2025 CEO succession plan ✓ Air Products will ensure a smooth transition during FY2025 for the new CEO ✓ On November 18, announced planned changes to its Board as part of its commitment to ongoing Refresh the Board with highly qualified, independent refreshment directors with relevant experience leading capital-intensive ✓ Following these changes, the Board will continue to be comprised of nine Directors, six of whom will have businesses and managing succession processes been appointed in the last five years as of the annual meeting ✓ Several recent changes to executive compensation program Restructure executive compensation to improve ✓ Performance shares awarded as long-term incentives beginning in FY2026 will include a return on invested alignment with strategy and performance capital measure, in addition to TSR relative to the S&P 500 Air Products’ Board Continuously Reviews Company Strategy, Capital Allocation, and Governance and Had Extensively Assessed the Above Items Prior to Mantle Ridge’s Involvement 52
The Board Maintains a Robust Capital Allocation Framework Focused on Maximizing Sustainable Long-Term Shareholder Value Our Approach • Invest in new projects that meet or exceed internal return targets Core industrial gas capex represents aligned with our two-pillar growth strategy >50% of FY2023-FY2025 total capex − Traditional industrial gas business and sustainable growth projects in favorable markets Clean Hydrogen Core Business • Invest to maintain our reliable and profitable asset base Growth, Growth 44% Capex, 42% Looking Forward • Evaluating alternative funding opportunities to reduce capital outlay • Expect meaningful declines in net debt to Adjusted EBITDA ratio starting FY2027 Core Business Maintenance Capex, 14% • Expect positive net cash starting in FY2027 53
Actively Managing Investment Risk Across Significant Projects Projects Under Execution Plant Customer / Location Current Status • Construction 60% complete; ~35% of production contracted on take-or-pay basis with negotiations underway for remaining production Green H AP/NEOM, Saudi Arabia • Recently executed long-term agreement for downstream distribution with TotalEnergies 2 • Investing $800 million – significantly less than $1.7B originally projected • Onstream by end of 2026 • Submitted for permits and expects them to be issued in 2025 and 2026 Blue H Production/LA, USA 2 • In active discussion for offtake and assessing equity partners and project financing • On hold awaiting permits H / SAF World Energy/CA, USA 2 • Mitigating development risk in interim period Net-zero blue H IOL/Canada• 60% of production committed with negotiations underway for remaining production 2 • Project moving forward on time Green H NY, USA 2 • Targeting onstream in 2027-2028 • Long-term offtake agreements with ExxonMobil and the Dutch State Blue H ExxonMobil / Rotterdam NL 2 • Targeting onstream in 2026 Air Products’ Board and Management Maintain a Disciplined, Rigorous Focus on De-Risking Clean Hydrogen Projects 54
Our Jazan and NEOM Projects Demonstrate Our Ability to Raise Alternative Funding NEOM Carbon-free hydrogen Jazan Joint Venture Produced and delivered with proven, world-class technology Supply Saudi Aramco with critical supply of power, steam, utilities, and hydrogen To Saudi Refined products Hydrogen Production at NEOM Hydrogen Refuelling Station power grid to market Electrolyzer Hydrogen Power Hydrogen Crude oil H2 400,000 BBL/day Dissociation Utilities Compression refinery Power Ammonia H 2 Nitrogen Vacuum 3,800 MW Global resid Syngas of power Gasifier Power Distribution Wind/Solar Carbon- (Air Products/Shell) Ammonia Block Ship/Truck free H 2 Production Oxygen 75,000 TPD Nitrogen ASU • Capital: multi-billion• Capital: ~$2 billion • Ownership: 1/3 equal Air Products/NEOM/ACWA Power• Ownership: 100% Air Products ~$12B of assets ASU acquired by JV Built by Air Products • Joint venture structure – with 40% member contributions and 60% • 73% non-recourse project finance, funded by 23 global financial institutions non-recourse project financing • 27% cash from three equity partners • Joint venture owns and operates the facility under a 25-year contract rd • Air Products only represents 1/3 share of the equity at $800 million, for a fixed monthly fee significantly less than initially planned • Significantly de-risked through Aramco offtake 55
The Air Products Board is a Prudent Steward of Capital, and Our Commitments Prove This Clean Energy • Assessing alternate funding Air Products Overall Key Pillars of Our Investing Strategy opportunities across nearly all ongoing clean hydrogen projects 75% firm commitment on offtake on existing projects before announcing 1 new projects • Actively looking across projects for equity partners who will Secure an anchor customer for future projects 2 commit to offtake Projects to have significant offtake committed on a long-term basis ahead • Put World Energy project on hold 3 of construction to avoid potential permit risk • Focused on investing into new Evaluate new projects against >10% target IRR threshold 4 projects that will achieve target IRR 5 Actively seeking equity investment and project financing for Louisiana Blue Energy ꟷ No longer pursuing Texas Green Hydrogen JV; sold development rights to our Evaluate the portfolio for opportunities to sell non-core businesses 6 partner Continue to invest in attractive core industrial gases growth projects that achieve • We expect positive net cash 7 target IRR starting in FY2027 Grow dividend each year, continuing to build on heritage of a 9% dividend CAGR 8 since FY2014 Many of These Commitments Existed Prior to Mantle Ridge’s Involvement 56
Conclusion 57
Conclusion Air Products Board and Management Have Consistently Delivered Results 01 (A) • We are the most profitable industrial gas business in the world based on Adjusted EBITDA margin , growing at GDP or industrial production levels – We operate core industrial gases infrastructure globally, including 1,800 miles of industrial gas pipeline and 750+ production facilities – ~50% of FY2024 sales were driven by our on-site customers; our on-site business model yields stable and consistent returns given that costs are passed through to the customers, the contracts are long-term (e.g., 10-20 years), and customers pay fixed monthly charges and / or have minimum purchase requirements (A) (A) • Significant gains in pricing, volume, and a stable, infrastructure-like on-site business model have delivered a 1,400bps increase in Adjusted EBITDA margin and a compound annual Adjusted EPS growth rate of ~11% since FY2014 (B) – Our sales have grown at a ~4% compound annual growth rate since FY2014 – higher than our public peers • Strong cash generation fuels continued increases in our dividend and strategic capital expenditures – Returned $11.5 billion of cash to shareholders since FY2014 – We have executed 42 consecutive years of dividend increases and have delivered a ~9% compound annual dividend growth rate since FY2014 (C) • Under the Board’s and Seifi Ghasemi’s leadership, Air Products has created more than $44B of shareholder value • Air Products has a track record of effectively executing on major projects, having successfully executed three major projects under the Board’s and Mr. Ghasemi’s stewardship over the last seven years alone – deploying $5B in capital and achieving overall returns across these projects exceeding our target – This includes the Lu’an Gasification Project, Jazan Industrial Complex and Uzbekistan Gas-to-Liquid Facility The Board and Management Have Developed and Are Executing on a Focused Strategy to Extend the Core into Clean Hydrogen 02 • Today, fossil fuels account for more than 80% of global energy production, with a meaningful CO footprint 2 – Clean hydrogen is a clean fuel of the future because it can be a source of energy like oil or gas but releases no climate-warming carbon dioxide • To grow long-term volumes, satisfy global decarbonization regulation, effectively serve evolving customer needs, and remain competitive, the industrial gases sector must invest in clean hydrogen capabilities – Clean hydrogen is a critical input for companies to reach their net-zero carbon emissions goals, including Air Products • Today, we are considered the leading supplier of hydrogen globally, and we are working to extend our leadership into clean hydrogen – We were the first industrial gases company to sell gray hydrogen over-the-fence and have been doing so for 50+ years – We capitalized on global desulfurization regulations in the 1990s to further supply hydrogen to refineries – We are using this strategy again to build upon our core business and capture growth in clean hydrogen • Because we are the first-mover, we have secured optimal locations globally and have begun forging critical supply chain and financing partnerships to excel in clean hydrogen – We are well-positioned to grow with the next phase of hydrogen development, which is clean hydrogen supported by the need to decarbonize hard-to-abate end markets – Our clean hydrogen growth will start with many of the same customers and end markets we know well and serve today • We are replicating the core industrial gases model: anchor customers, long-term committed offtake ahead of construction, take-or-pay contracts with cost pass-through – We expect positive net cash starting in FY2027 – Air Products’ clean hydrogen projects are expected to deliver returns at or above our core industrial gas return levels, producing significant additional value to our shareholders Sources: Company Filings and Presentations, Publicly Available Information, United Nations, Capital IQ (A) Non-GAAP financial measure. See Appendix for reconciliation 58 (B) Peers include Air Liquide, Linde and Nippon Sanso. Air Products based on GAAP sales CAGR from 9/30/14 to 9/30/24 as reclassified to give effect to divestitures of the PMD and EMD businesses. Air Liquide based on CAGR from 12/31/14 to 12/31/24(E) and is adjusted for its acquisition of Airgas. Linde based on CAGR from 12/31/16 to 12/31/24(E) and is adjusted for its combination with Praxair. Nippon Sanso based on CAGR from 3/31/18 to 3/31/25(E) and is adjusted for its acquisition of Praxair European Assets. Starting revenue data-point is converted to USD at historical FX rate (C) Based on $25.2B market capitalization on June 30, 2014 (one day prior to Seifi Ghasemi’s first day as CEO) and December 13, 2024
Conclusion Refreshed, Independent and Fit-For-Purpose Board to Oversee Our Strategy 03 • The Air Products Board has the skills, experience, and expertise to oversee the successful execution of our two-pillar growth strategy to grow our core industrial gas business while capitalizing on our first-mover advantage in the clean hydrogen market and driving value creation • The Board and Management team have been responsive to shareholders regarding capital investment discipline, making several strategic announcements of late that had been under review, such as (a) not committing to new clean hydrogen projects until existing capacity is majority-committed and (b) no longer pursuing the Texas green hydrogen JV after concluding its return profile would be insufficient to meet our standards • The Board is committed to regular refreshment. To that end, six of nine directors on our slate were nominated in the last five years, including two new director nominees • Our two new nominees, Bob Patel and Alfred Stern, were selected after an extensive search process and bring significant experience leading and overseeing public companies as CEOs – Each has a stellar record growing major industrial companies internationally and capitalizing on clean energy and sustainability opportunities • The Board is conducting a thorough search, aided by an independent search firm, for a President to serve as a qualified CEO successor to Mr. Ghasemi – This search began in January 2023 and was formally announced in August 2024, prior to D.E. Shaw’s or Mantle Ridge's involvement. We anticipate the announcement of the new President and related timeline for CEO succession no later than March 31, 2025 • The Board is confident that we will recruit a candidate of superior caliber and experience: someone well known to investors and a current or former public company CEO with significant international experience and relationships to address the scale of our business • The Board is currently prioritizing five candidates from a pool of over 1,000 candidates Without Any Serious Plan for Value Creation, Mantle Ridge Seeks to Replace Air Products’ Board Leadership with Inferior Nominees 04 with Questionable Independent Thought • Our interactions with Paul Hilal and Mantle Ridge demonstrate a lack of judgment and a pattern of behavior that is beyond the basis for reasonable, constructive engagement. Mantle Ridge is seeking to seize control of Board leadership and management by replacing our Lead Independent Director, replacing two of three independent committee Chairs, firing our CEO, replacing the executive team, and halting our strategy that is on track to create substantial long-term shareholder value, without any viable alternative for growth • Mantle Ridge has proposed a new CEO candidate, despite not nominating him to their slate, who lacks public company CEO experience, has never served as a public company director and has not served in an operational role in four years • Mantle Ridge has proposed an Executive Board Chairman candidate who, according to media reports and court filings and transcripts, may have leaked confidential information from three companies on whose boards he was serving to a friend, leading to criminal charges being brought against the friend for lying to the FBI, and SEC enforcement action against the friend and another individual who appears to have traded on the basis of such information • Shortly before public disclosure of this candidate’s reportedly having leaked confidential information and the related enforcement actions, the candidate resigned from three boards and the candidate has not served on the board of a public company since such resignations nearly six years ago, and has not served in an operating role in 17 years • The election of Mantle Ridge's slate of nominees would remove critical expertise from our Board, including our CEO and Lead Independent Director, along with two other highly-qualified independent directors with extensive experience leading world-scale energy projects and multi-jurisdictional M&A expertise • We believe Mantle Ridge’s nominees have been selected, not because their experience is superior to or more relevant than our existing nominees, but rather because of pre-existing relationships with Mr. Hilal or their history as previous activist nominees • Shareholders should be concerned that the relationships between certain of Mantle Ridge’s nominees and Mr. Hilal could preclude them from acting independently 59
Appendix 60
Adjusted EBITDA and Adjusted EBITDA Margin Reconciliation Adjusted EBITDA and Margi Ad njus ted EBITDA Margin Air Products defines adjusted EBITDA as net income less income or loss from discontinued operations, net of tax, and excluding non-GAAP adjustments, which the Company does not believe to be indicative of underlying business trends, before interest expense, other non-operating income (expense), net, income tax provision, and depreciation and amortization expense. Adjusted EBITDA and adjusted EBITDA margin provide useful metrics for management to assess operating performance. Margins are calculated independently for each period by dividing each line item by consolidated sales for the respective period and may not sum to total margin due to rounding. The tables below present consolidated sales and a reconciliation of net income on a GAAP basis to adjusted EBITDA and net income margin on a GAAP basis to adjusted EBITDA margin: Millions of U.S. Dollars unless otherwise indicated FY2024 FY2023 FY2022 FY2021 FY2020 FY2019 FY2018 FY2017 FY2016 FY2015 FY2014 Sales $12,100.6 $12,600.0 $12,698.6 $10,323.0 $8,856.3 $8,918.9 $8,930.2 $8,187.6 $7,503.7 $7,824.3 $8,384.0 Net income 3,862.4 2,338.6 2,266.5 2,114.9 1,931.1 1,809.4 1,532.9 3,021.2 661.5 1,317.6 993.1 Net income margin 31.9% 18.6% 17.8% 20.5% 21.8% 20.3% 17.2% 36.9% 8.8% 16.8% 11.8% Reconciliation of GAAP to Non-GAAP: Net income $3,862.4 $2,338.6 $2,266.5 $2,114.9 $1,931.1 $1,809.4 $1,532.9 $3,021.2 $661.5 $1,317.6 $993.1 Less: (Loss) Income from discontinued operations, net of tax (13.9) 7.4 12.6 70.3 (14.3) — 42.2 1,866.0 (460.5) 351.7 302.1 Add: Interest expense 218.8 177.5 128.0 141.8 109.3 137.0 130.5 120.6 115.2 102.8 124.0 Less: Other non-operating (expense) income, net (73.8) (39.0) 62.4 73.7 30.7 66.7 5.1 16.6 (5.4) (42.3) (51.7) Add: Income tax provision 944.9 551.2 500.8 462.8 478.4 480.1 524.3 260.9 432.6 300.2 258.1 Add: Depreciation and amortization 1,451.1 1,358.3 1,338.2 1,321.3 1,185.0 1,082.8 970.7 865.8 854.6 858.5 875.6 Add: Facility closure — — — 23.2 — 29.0 — — — — — Less: Change in inventory valuation method — — — — — — 24.1 — — — — Less: Gain on sale of business 1,575.6 — — — — — — — — — — Add: Business restructuring, cost reduction, and asset actions 57.0 244.6 73.7 — — 25.5 — 151.4 34.5 180.1 11.1 Add: Business separation costs — — — — — — — 32.5 50.6 7.5 — Less: Gain on exchange with joint venture partner — — — 36.8 — 29.1 — — — — — Less: Gain on previously held equity interest — — — — — — — — — 17.9 — Add: Goodwill and intangible asset impairment charge — — — — — — — 162.1 — — 310.1 Less: Company headquarters relocation income — — — — 33.8 — — — — — — Less: Gain on land sales — — — — — — — 12.2 — 33.6 — Add: Equity method investment impairment charge — — 14.8 — — — — 79.5 — — — Less: India Finance Act 2020 - equity affiliate income impact — — — — 33.8 — — — — — — Add: Tax reform repatriation - equity method investment — — — — — — 28.5 — — — — Add: Loss on extinguishment of debt — — — — — — — — 6.9 16.6 — Adjusted EBITDA $5,046.3 $4,701.8 $4,247.0 $3,883.2 $3,619.8 $3,468.0 $3,115.5 $2,799.2 $2,621.8 $2,422.4 $2,321.6 Adjusted EBITDA margin 41.7% 37.3% 33.4% 37.6% 40.9% 38.9% 34.9% 34.2% 34.9% 31.0% 27.7% Net income margin improvement FY2014-FY2024 2,010 bps Adjusted EBITDA margin improvement FY2014-FY2024 1,400 bps 61
Adjusted Diluted Earnings Per Share (“EPS”) Reconciliation Adjusted Diluted Earnings per Share ( EPS ) Adjusted diluted EPS is presented on a continuing operations basis. Air Products calculates this non-GAAP measure as net income from continuing operations attributable to Air Products, excluding the impact of certain disclosed items that the Company believes are not representative of underlying business performance, divided by the weighted average common shares reflecting the potential dilution that could occur if stock options or other share-based awards were exercised or converted into common stock. The Company believes it is important for the reader to understand the per share impact of our non-GAAP adjustments because management does not consider these impacts when evaluating underlying business performance. Per share impacts are calculated independently and may not sum to total adjusted diluted EPS due to rounding. FY2021-FY2024 Effective beginning in fiscal year 2023, Air Products' adjusted diluted EPS excludes the impact of non-service related components of net periodic benefit/cost for the Company's defined benefit pension plans. Adjusted diluted EPS for fiscal years 2022 and 2021 and relevant comparisons presented below have been recast accordingly to conform to this presentation. FY2024 FY2023 FY2022 FY2021 Diluted EPS $17.24 $10.30 $10.08 $9.12 Facility closure — — — 0.08 Gain on sale of business (5.38) — — — Business and asset actions 0.20 0.92 0.27 — Gain on exchange with joint venture partner — — — (0.12) Equity method investment impairment charge — — 0.05 — Loss on de-designation of cash flow hedges 0.02 — — — Non-service pension cost (benefit), net 0.34 0.29 (0.15) (0.29) Tax election benefit and other — — — (0.05) Adjusted Diluted EPS $12.43 $11.51 $10.25 $8.73 FY2024 vs. FY2023 vs. FY2022 vs. FY2023 FY2022 FY2021 Change GAAP Diluted EPS $ change $6.94 $0.22 $0.96 Diluted EPS % change 67% 2% 11% Change Non-GAAP Adjusted diluted EPS $ change $0.92 $1.26 $1.52 Adjusted diluted EPS % change 8% 12% 17% 62
Adju sted Diluted Earnings Per Share (“EPS”) Reconciliation (Cont’d) FY2014-FY2021 Amounts presented in the table below are as previously reported. The per share impact for each non-GAAP adjustment was calculated independently and may not sum to total adjusted diluted EPS due to rounding. FY2021 FY2020 FY2019 FY2018 FY2017 FY2016 FY2015 FY2014 Diluted EPS $9.12 $8.55 $7.94 $6.59 $5.16 $5.04 $4.29 $3.24 Change in inventory valuation method — — — (0.08) — — — — Facility closure 0.08 — 0.10 — — — — — Business separation costs — — — — 0.12 0.21 0.03 — Tax (benefit) costs associated with business separation — — — — (0.02) 0.24 — — Business restructuring, cost reduction, and asset actions — — 0.08 — 0.49 0.11 0.61 0.03 Goodwill and intangible asset impairment charge — — — — 0.70 — — 1.27 Gain on exchange with joint venture partner (0.12) — (0.13) — — — — — Gain on previously held equity interest — — — — — — (0.05) — Company headquarters relocation (income) expense — (0.12) — — — — — — Gain on land sales — — — — (0.03) — (0.13) — India Finance Act 2020 — (0.06) — — — — — — Equity method investment impairment charge — — — — 0.36 — — — Pension settlement loss — — 0.02 0.15 0.03 0.02 0.06 0.02 Loss on extinguishment of debt — — — — — 0.02 0.07 — Tax reform repatriation — — (0.06) 2.16 — — — — Tax reform adjustment related to deemed foreign dividends — — 0.26 (0.25) — — — — Tax reform rate change and other — — — (0.96) — — — — Tax restructuring — — — (0.16) — — — — Tax election benefit and other (0.05) — — — (0.50) — — (0.14) Adjusted Diluted EPS $9.02 $8.38 $8.21 $7.45 $6.31 $5.64 $4.88 $4.42 FY2021 vs. FY2020 vs. FY2019 vs. FY2018 vs. FY2017 vs. FY2016 vs. FY2015 vs. FY2020 FY2019 FY2018 FY2017 FY2016 FY2015 FY2014 Change GAAP Diluted EPS $ change $0.57 $0.61 $1.35 $1.43 $0.12 $0.75 $1.05 Diluted EPS % change 7 % 8 % 20 % 28 % 2 % 17 % 32 % Change Non-GAAP Adjusted diluted EPS $ change $0.64 $0.17 $0.76 $1.14 $0.67 $0.76 $0.46 Adjusted diluted EPS % change 8 % 2 % 10 % 18 % 12 % 16 % 10 % 63
Thank You
Also on December 18, 2024, the Company mailed the following letter to its shareholders and posted the same to its website, https://www.voteairproducts.com/:
Vote “FOR” Only Air Products’ Highly Qualied fi Director Nominees on the WHITE Proxy Card
December 18, 2024 Dear Fellow Shareholder, The Air Products Annual Meeting is fast approaching, and you have an important opportunity to protect the value of your investment and the meaningful results the Company has delivered and anticipates continuing to deliver — as we have for the past 10 years. Under the supervision of our Board, management is executing a long-term strategy to grow our core industrial gas business, while leveraging decades of relevant expertise to capitalize on our important first-mover position in the clean hydrogen market to deliver maximized value for our shareholders. We ask that you please visit our Annual Meeting website at voteairproducts.com or the Company Investor Relations page to find a new investor presentation that we filed today, entitled “Creating Superior Shareholder Value Through Disciplined Investment in Clean Hydrogen,” where we go through, in greater detail, why our long-term growth strategy is the right one, why Air Products’ Nominees are the necessary leaders to move Air Products forward, and why shareholders should not support Mantle Ridge’s nominees. We recommend you vote your shares “FOR” ONLY Air Products’ Nominees — Tonit M. Calaway, Charles Cogut, Lisa A. Davis, Seifollah Ghasemi, Jessica Trocchi Graziano, Edward L. Monser, Bhavesh V. (“Bob”) Patel, Wayne T. Smith and Alfred Stern — on the Company’s WHITE proxy card. Over the Past Decade Under the Leadership of Our Chief Executive Oc ffi er, Seifi Ghasemi, Air Products Has Created 1 Over $44 Billion in Shareholder Value Since Mr. Ghasemi became CEO in 2014, he has spearheaded the transformation of Air Products into the most profitable industrial gas business in the world based on adjusted EBITDA margin, growing the business at GDP-plus rates. This strong cash generation has allowed Air Products to invest in our core industrial gas business, while expanding into clean hydrogen — a tremendous growth opportunity now and well into the future. Our strong performance has directly benefitted shareholders through $11.5 billion in cash returned since 2014. In addition, our dividend per share has increased for 42 consecutive years and grown at a ~9% CAGR for the past 10 years, demonstrating our commitment to sharing with our investors the value we create. Including 2 dividends, Air Products has delivered over $44 billion in total shareholder value over the last decade under Mr. Ghasemi’s leadership. 1
During Mr. Ghasemi’s tenure, the Company has delivered the following key financial outcomes: Air Products Has Achieved Sector-Leading Sales Growth Long-Term Organic Sales Compound Annual Growth Rate (Chart 1) (A) 3.7% (B) 2.3% (C) 1.7% (D) 1.3% Under The Board’s and Seifi Ghasemi’s Leadership, Margins Have Become Best-in-Class (A)(B) (A)(C) Air Products Adjusted EBITDA Margin (Chart 2) LTM Adjusted EBITDA Margin (%) (Chart 3) 41.7% 41.7% 38.9% 38.2% 37.6% 40.9% 34.9% 37.3% 27.7% 22.8% 34.9% 34.2% 33.4% Rising energy costs inflated 31.0% sales (denominator), simultaneous lag in full 27.7% pass-through / recovery 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 (A) Air Products Has Consistently Grown its Adjusted EPS and Dividend (A) Adjusted EPS ($) (Chart 4) Dividends Per Share ($) (Chart 5) $14.00 $8.00 $13.00 $7.00 ~11% ~9% $12.00 CAGR CAGR $6.00 $11.00 $10.00 $5.00 $9.00 $4.00 $8.00 $7.00 $3.00 $6.00 $2.00 $5.00 $1.00 $4.00 $3.00 $0.00 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Under Mr. Ghasemi’s direction, the Company has continuously pushed for profitability improvements and has been increasing its price-cost spread. This has been accomplished through favorable contract modifications over time, resulting in an increased contribution of stable on-site revenues. Further improvement and growth of the core industrial gas business are ongoing, and the Board and management team remain focused on 2 maximizing value over the long-term.
Power Industry District Heat Transport Buildings Air Products Is Successfully Executing a Two-Pillar Growth Strategy to Continue Driving Value Creation into the Future We remain focused on investing in, and growing, our core industrial gas business, which delivers industry-leading 3 profitability based on adjusted EBITDA margin, while advancing our first-mover advantage in the clean hydrogen market. We have allocated more than 50% of our total capital expenditures for FY 2023-2025 to our core business, underscoring our commitment to its continued growth. We have already launched multiple projects in recent years aimed at improving capacity, increasing efficiencies and reaching new industrial gas markets. In tandem with these investments, Air Products is positioning the core business to capture opportunities for growth in expanding market segments. For instance, we have accumulated a critical mass of infrastructure strategically placed next to global electronics providers’ fabrication facilities, orienting our core industrial gas business to benefit from data center, AI and CHIPS Act tailwinds. As a result of this approach, we have achieved significant tangible benefits to the business. Our on-site core capabilities model is driving resilience through a balanced mix of on-site and merchant sales. We are more heavily weighted toward the stable, infrastructure-like on-site business model than our peers, strengthening the durability of our business. At the same time, we are expanding into clean hydrogen, a market with immense long-term potential: 4 • Today, 80% of the global energy market is fossil fuel-based, with clean hydrogen poised to play a major role in diversifying the mix of energy sources. • Clean hydrogen can be burned a source of energy like oil or gas but releases no climate-warming carbon dioxide, making it an ideal fuel for the future amid a global push to decarbonize emissions. • To grow long-term volumes, satisfy global decarbonization regulation, effectively serve evolving customer needs, and remain competitive, the industrial gases sector must invest in clean hydrogen capabilities. According to independent experts, the clean hydrogen market is expected to be worth more than 5 $600 billion by 2030 and exceed $1 trillion by 2050. Clean hydrogen may contribute up to 20% of total global 6 abatement needed by 2050. Clean hydrogen is anticipated to have applications across a diverse array of end markets including road transport, shipping, iron, aluminum and steel, chemicals and petrochemicals, and power generation. (A) Hydrogen May Contribute Up to 20% of Global Emissions Reduction by 2050 (B) Annual CO2 Emission (Gt/year) / Abatement by Technology (%) (Chart7) Energy-related CO2 Emissions (Gt/yr) (Chart 6) Up to 20% Clean Hydrogen 35 30 25 20 Other Renewables & 80% 15 Energy Efficiency 10 5 0 2010 2020 2030 2040 2050 3 Buildings Transport District Heat Power Industry
No company is better positioned than Air Products — with more than 65 years of hydrogen experience — to meet the growing demand in this space, by serving global customers across industries working to improve efficiency and reliability while reducing emissions. Initially capturing even a small portion of the clean hydrogen market would provide incredible value for shareholders. First-Mover Advantage Is Absolutely Critical to Success in the Clean Hydrogen Market — and We Are Seeing Early Results There are four key elements that make being the first mover in clean hydrogen incredibly crucial, and where Air Products has an edge: Land scarcity: Access to ample resources such as Securing best-in-class customer agreements: We sun and wind are critical to produce green hydrogen; have the best seat at the table to negotiate offtake and the right geology, large land plots, low-cost agreements with customers. natural gas for carbon sequestration, and skilled Obtaining highest-quality financing partners : labor are essential for blue hydrogen production. Meaningful capital investment is needed to secure Limited supply chain partners: Supply chain the backing of financing partners with the proper logistics are complex, and the necessary intellectual scale and industry expertise. property and partners are limited. Underpinning our advantage in these four important areas are the critical developments of proprietary knowledge and intellectual property, which enable a first-mover advantage to transition into a world-leading position. Capturing a small portion of market share now will compound as the market continues to expand. Because of our foresight and strategic investment, Air Products has achieved several early successes in clean hydrogen to date: We announced a pioneering supply agreement in June 2024, a 15-year take-or-pay agreement to supply 70,000 tons of green hydrogen annually to decarbonize TotalEnergies’ Northern European refineries starting in 2030. We are also in discussions for green hydrogen supply to its other EU refineries. 60% of capacity for our Canada Net-Zero Hydrogen Energy Project is already committed, and negotiations for the remainder of the capacity are underway. We are the primary EPC contractor and system integrator of the NEOM Green Hydrogen Complex, the largest green-hydrogen-based ammonia production facility that will serve as a key solution for transportation and industrial sectors globally. Air Products is the exclusive off-taker of the green hydrogen produced in the form of green ammonia at the facility. We support Daimler’s European Hydrogen Refueling Network project to develop permanent and commercial scale hydrogen refueling stations and have announced networks are being built in California in addition to Canada and Europe. These important achievements are underpinned by the Board’s relentless focus on disciplined capital allocation and risk management controls. We remain focused on delivering on the onstream dates we have outlined and are securing more contracted offtake. The Company expects to generate positive net cash starting in FY2027. 4
Air Products’ Board Is Refreshed, Independent and Fit-For-Purpose — Mantle Ridge’s Proposed Nominees Would Remove Signic fi ant and Relevant Experience and Expertise from the Board Our Board is committed to strong governance practices, including regular Board refreshment. This is demonstrated through our diverse and continuously enhanced Board composition. With Air Products shareholders supporting our nominations of Mr. Patel and Mr. Stern at the 2025 Annual Meeting, six out of nine Directors will have been first elected in the last five years. Our Board is world-class with expertise across a full range of disciplines, from operations and supply chain optimization to corporate governance and regulations. It consists of individuals with high-caliber executive and leadership experience in chemicals, industrial manufacturing and renewables as well as public company board experience. Mantle Ridge is seeking to replace four directors who are integral to our Board: Seifollah (Seifi) Ghasemi, Edward L. Monser, Charles Cogut and Lisa A. Davis. If successful, Mantle Ridge’s nominees would eliminate significant and relevant expertise brought by these current directors and disrupt the significant progress the Company has made. Seifollah “Seifi” Ghasemi Dennis Reilley Chairman, President and CEO of Air Products Mantle Ridge Chairman Nominee Highly respected executive in industrial gases Multiple news outlets reported, based on and specialty chemicals testimony in a federal court plea hearing, that he leaked to a friend non-public information he was Shareholder in APD with personal stake totaling privy to during the period he served as a director 7 around $239 million of Covidien, DowDuPont and Marathon Oil, including, in the case of Covidien, about an Incentives highly aligned with shareholders upcoming M&A transaction, resulting in federal and SEC enforcement charges and fines against Appointed CEO in 2014 after Pershing Square / Paul the friend and a business associate Hilal supported his appointment to the Board Shortly before public disclosure of reportedly Signic fi ant industry CEO and executive experience having leaked confidential information and the related enforcement actions, he resigned from Transformed Air Products by creating over $44 three boards and has not served on the board of 8 billion of shareholder value during his tenure a public company since such resignations nearly six years ago Built Air Products into the industry leader Has not held an executive or operating position through organic revenue growth, margin in over 17 years expansion, EPS expansion, and the development and implementation of a Five-Point Plan to guide Owns no shares in APD future success Longstanding relationship with Mr. Hilal from tenure on CSX Board in connection with Mantle Ridge’s settlement with CSX and serving as a nominee of Mantle Ridge in its activist fight at Dollar Tree Has a two-year consulting agreement with Mantle Ridge, misaligning his interests from those of Air Products’ shareholders 5
Edward L. Monser Paul Hilal Lead Independent Director of Air Products Mantle Ridge CEO and Nominee Significant experience in industrial operations No experience with the board or operations of an and supply chain optimization industrial gas or chemicals company Appointed in 2014 with support from Pershing Track record of value destruction and mismanaged Square / Paul Hilal who stated as recently as succession processes at all of Mantle Ridge’s public October 2024 that: Ed Monser is “the kind of truly activist campaigns – Aramark, CSX and Dollar Tree independent, high-integrity and shareholder- – TSR relative to the S&P 500 during his Board oriented director nominee[ ] that we think can best tenures decreased at all companies: Dollar Tree 9 10 serve shareholders ” -104%, CSX -69% and Aramark -63% Over 30 years of experience leading global Dissident director slate appears assembled largely engineering organizations through strategic change based on previous relationships and activism involvement as opposed to fit-for-purpose recruitment Strong understanding of industrial operations, supply chain optimization and Under his board oversight, CSX said in October 2024 continuous improvement it had received a subpoena from the Securities and Extensive experience in international business Exchange Commission over an accounting operations in emerging markets restatement, as well as information requests about some of the company’s performance metrics Charles Cogut Tracy McKibben Independent Director of Air Products Mantle Ridge Nominee Leading corporate lawyer with multi-jurisdictional Less relevant experience than targeted directors M&A expertise Appears to have significantly less legal Regarded as one of the most prominent experience than Mr. Cogut corporate lawyers in the United States Energy experience via advisory work is redundant, but on a much less comparable level 39-year tenure at Simpson Thacher & Bartlett LLP given Lisa Davis and Alfred Stern’s much more where he specialized in: domestic, international and significant energy expertise cross-border M&A, the representation of special committees of boards of directors, buyouts and Former board experience includes other transactions involving private equity firms governance issues involving related party transactions and involvement in controversial Previously served as a director of The Williams and unsuccessful activism campaigns Companies, Inc. Lisa A. Davis Andrew Evans Independent Director of Air Products Mantle Ridge Nominee Extensive experience leading world-scale energy Less relevant experience than targeted directors projects, including renewables Public executive and board experience limited to 35-year tenure leading large, multi-faceted the U.S. and affiliation with an activist international businesses within energy and shareholder campaign manufacturing industries, overseeing and Industry credentials and renewable energy project implementing world-scale energy projects experience pale in caliber to those of Lisa Davis Served on public boards in the U.S. and Europe, Oversaw the finances of the Vogtle nuclear power knowledge which is crucial to the Company as it plant expansion project at Southern Co as CEO, implements complex international projects which which was plagued by construction delays and are an increasing portion of the business cost overruns — the project was seven years late 6 and $17 billion over budget
Our Board is world-class with expertise across a full range of disciplines from operations and supply chain optimization to corporate governance and regulatory expertise. Mantle Ridge’s Proposed Executive Chairman Candidate Appears Alarmingly Unt t fi o Lead Air Products Or Any Public Company The core pillar of Mantle Ridge’s efforts is the replacement of the Board’s lead independent director, Ed Monser, as well as our Chairman and CEO, Seifi Ghasemi, with its hand-picked successors, Dennis Reilley and Eduardo Menezes. As you consider changes which would upend the leadership at Air Products and derail our momentum, we believe it is important that you are aware of the following facts relating to Mr. Reilley that the Board became aware of during its thorough evaluation of Mantle Ridge’s nominees: • In February 2019, a purported friend of Mr. Reilley, John Davidson, signed a plea agreement with the United States, admitting to making a false statement to the FBI that he had never received from “D.R.” any non-public information, which “D.R.” had acquired as a result of his position on the boards of 11 Marathon Oil, DowDuPont, or Covidien. The plea agreement used the initials “D.R.” only when referring to the director in question. We note that Mr. Reilley was not named directly in the complaint by the United States. • Shortly thereafter, the media reported on the charges brought against Mr. Davidson, and noted clearly that the charges stemmed from the FBI’s investigation into Dennis Reilley and whether insider information was provided about the impending merger of Covidien PLC, with its rival, Medtronic Inc. The 12 media noted that Mr. Reilley was a director at Covidien. • In December 2019, an associate of Mr. Davidson, John Special, was found liable and ordered to pay 13 nearly $3 million in an SEC enforcement action, for allegedly trading on the basis of the information leaked by Mr. Davidson, who had received material, non-public information from a “Director” who served on the boards of Covidien, Marathon Oil and DowDuPont, including in the case of Covidien, about a proposed transaction between Covidien and Medtronic. We note that Mr. Reilley was not named directly in the SEC’s complaint. • Notably, before news of the plea agreement and SEC enforcement action became publicly known, in December 2018 and January 2019, Mr. Reilley resigned as director of CSX (to which he had been appointed by Mantle Ridge) and DowDuPont, (both in December 2018), and as director and chairman of Marathon Oil (in February 2019), respectively. Mr. Reilley has not served on a public company board since these resignations. 7
A portion of the transcript from the hearing in which Mr. Davidson pled guilty to lying to the FBI regarding who he received information in connection with the Covidien/Medtronic’s merger is pasted below. If true, the statements are deeply concerning, as they show the director in question leaked board confidences regularly with his friend: MS. ANDERSON [Assistant U.S. Attorney]: And he D.R. provided you with nonpublic information he had received from all three of those boards, correct? THE DEFENDANT: Yes, ma’am. MS. ANDERSON: And he D.R. forwarded emails he received as a board member? THE DEFENDANT: Yes, ma’am. […] MS. ANDERSON: You had, in fact, received nonpublic information from D.R. that he had acquired from his board work at Covidien, Marathon and Dow, correct? THE DEFENDANT: Yes, ma’am. MS. ANDERSON: And sometime between March 2014 and May 15th, 2014, you specifically learned from D.R. about developing negotiations about Covidien’s merger with or acquisition by Medtronic, correct? THE DEFENDANT: That is correct. MS. ANDERSON: And you understood that information to be nonpublic, correct? THE DEFENDANT: Yes, ma’am. In a statement Mantle Ridge issued on December 13 in response to another media report on the matter, it stated, “To be clear, Mr. Reilley in no way acted inappropriately, and has never been accused of or charged with any impropriety or wrongdoing in connection with the matter.” Mantle Ridge also claimed in its response that Mr. Davidson’s testimony was “false”. While Mr. Reilley was never formally charged by the FBI or the SEC for any wrongdoing, the information revealed in Mr. Davidson’s plea agreement and the SEC’s complaint against Mr. Special, if true, raises grave concerns about Mr. Reilley’s trustworthiness and ability to comply with his basic duty of confidentiality as a director. Mantle Ridge has offered no reasonable explanation to shareholders regarding this matter, other than to claim the testimony obtained under oath is false. These circumstances not only call into question Mantle Ridge’s judgment in putting Mr. Reilley forward, but also the credibility of the entire Mantle Ridge slate and campaign. In the Board’s view, this matter should disqualify Mr. Reilley from ever again serving on a public company board. 8
Mantle Ridge’s Preferred CEO Candidate Is Insuc ffi iently Qualie fi d In addition, Mantle Ridge’s proposed CEO candidate, Eduardo Menezes, lacks public company CEO or board experience — two key criteria for Air Products’ next CEO that the Board established months ago. By proposing a CEO candidate like Mr. Menezes who would require substantial on-the-job training and chaperoning at a pivotal moment for the Company, Mantle Ridge has clearly demonstrated that it is not interested in a thoughtful succession process that would benefit all shareholders and is instead only concerned about its own interests. Mr. Menezes is insufficiently experienced and lacks the basic qualifications our Board is looking for in CEO candidates. Key CEO Search Qualities Established Before Engagement with Mantle Ridge Eduardo Menezes by the Air Products Board Mantle Ridge CEO Candidate Expert track record of value creation and No significant employment experience superior industry experience as CEO or outside of his tenure at Linde and the Board Director company’s subsidiaries Strong investor relationships and well known Was passed over for the CEO role at Linde after to the investor community 35 years with the company, never being promoted beyond EVP and Head of EMEA Current or former public company CEO No public company C-suite or Significant international experience board experience Global relationships with policymakers Retired since leaving Linde in 2021 and regulators In contrast to Mantle Ridge’s inadequate CEO candidate who fails to meet the Board’s previously communicated search criteria, Air Products is advancing with a CEO succession process to find an excellent candidate suited to lead the Company in this next stage of growth. This process was announced in August 2024, prior to D.E. Shaw’s, or Mantle Ridge’s involvement. The Board has committed to providing an announcement of a new President and related timeline for CEO succession no later than March 31, 2025. Mr. Hilal and Mantle Ridge have run the same failed playbook in each of its three activist campaigns since its founding. Each case forced major changes, including replacing the CEOs, and have failed to create long-term value for shareholders relative to the S&P 500. Since its founding, Mantle Ridge has never run an activist campaign or made a CEO change that has driven outperformance. Mantle Ridge’s stale, recycled playbook has failed before and, if implemented at Air Products, would fail again. Mantle Ridge’s substandard Chairman and CEO candidates and lack of any credible plan leave us highly concerned that, if successful with its campaign, its actions would derail our clean hydrogen strategy and destroy shareholder value. 9
Safeguard the Value of Your Investment in Air Products by Voting for the Election of All of Air Products’ Nine Nominees on the White Proxy Card The Board understands its responsibility to deliver value to ALL shareholders. The Board also, with the support of its leadership advisory firm, considered Mantle Ridge’s revised slate and unanimously determined these nominees still do not offer qualifications superior to Air Products’ well-balanced slate of nominees with the proper skills and experience to lead the Company through its next phase of growth. Tonit M. Calaway, Charles ”Casey” Cogut, Lisa A. Davis, Independent Independent Independent Executive Vice President, Chief Retired Partner, Former Member of the Managing Administrative Officer, General Simpson Thacher & Bartlett LLP Board and CEO of Gas and Power Counsel and Secretary of for Siemens AG BorgWarner Inc. Seifollah “Seifi” Ghasemi, Jessica Trocchi Graziano, Edward L. Monser, Chairman Independent Independent, Lead Director President, and CEO Senior Vice President and Chief Retired President and Chief Financial Officer of United States Operating Officer of Emerson Steel Corporation Electric Co. Bhavesh V. (“Bob”) Patel, Wayne T. Smith, Alfred Stern, Independent, New Nominee Independent Independent, New Nominee Former President of Retired Chairman and Chief Executive Officer and Standard Industries Chief Executive Officer of Chairman of the Executive Board of BASF Corporation OMV Aktiengesellschaft We strongly urge that you vote your shares “FOR” ONLY Air Products’ Nominees. Please discard any blue proxy card you may receive from Mantle Ridge. Thank you for your ongoing support. Sincerely, The Air Products Board of Directors 10
YOUR VOTE IS IMPORTANT. Whether or not you plan to virtually attend the Annual Meeting, please take a few minutes now to vote by Internet or by telephone by following the instructions on the WHITE proxy card, or to sign, date and return the enclosed WHITE proxy card in the enclosed postage-paid envelope provided. Regardless of the number of Company shares you own, your presence by proxy is helpful to establish a quorum and your vote is important. Our Board of Directors Unanimously Recommends a Vote “FOR” Air Products’ Nine Nominees and Proposals on the Enclosed WHITE Proxy Card. For more information regarding our Board nominees and strategy, please visit: www.voteairproducts.com. If you have any questions or require any assistance with voting your shares, please call the Company’s proxy solicitor: Innisfree M&A Incorporated 501 Madison Avenue, 20th Floor Shareholders may call toll free: (877) 750-0937 New York, New York 10022 Banks and Brokers may call collect: (212) 750-5853 This letter contains “forward-looking statements” within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s expectations and assumptions as of the date of this letter and are not guarantees of future performance. While forward-looking statements are made in good faith and based on assumptions, expectations and projections that management believes are reasonable based on currently available information, actual performance and financial results may differ materially from projections and estimates expressed in the forward-looking statements because of many factors, including the risk factors described in our Annual Report on Form 10-K for the fiscal year ended September 30, 2024 and other factors disclosed in our filings with the Securities and Exchange Commission. Except as required by law, we disclaim any obligation or undertaking to update or revise any forward-looking statements contained herein to reflect any change in the assumptions, beliefs or expectations or any change in events, conditions or circumstances upon which any such forward-looking statements are based. This communication contains certain financial measures that are not prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), including adjusted EPS, adjusted EBITDA, and adjusted EBITDA margin. On our website, at investors.airproducts.com, we have included definitions and reconciliations of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with GAAP. Management believes these non-GAAP financial measures provide investors, potential investors, securities analysts, and others with useful information to evaluate our business because such measures, when viewed together with our GAAP disclosures, provide a more complete understanding of the factors and trends affecting our business. The non-GAAP financial measures supplement our GAAP disclosures and are not meant to be considered in isolation or as a substitute for the most directly comparable measures prepared in accordance with GAAP. These measures may not be comparable to similarly titled measures used by other companies. 1 Based on $25.2B market capitalization on June 30, 2014 (one day prior to (C) Linde based on CAGR from 12/31/16 to 12/31/24(E) and adjusted for its Seifi Ghasemi’s first day as CEO) and December 13, 2024 combination with Praxair. 2 Based on $25.2B market capitalization on June 30, 2014 (one day prior to (D) Air Liquide based on CAGR from 12/31/14 to 12/31/24(E) and adjusted for its Seifi Ghasemi’s first day as CEO) and December 13, 2024 acquisition of Airgas. Starting revenue data-point is converted to USD at historical FX rate. Latest revenue data-point converted to USD at current FX 3 Non-GAAP financial measure. Visit investors.airproducts.com for rate. reconciliation. Sources for Charts 2, 3 and 4: SEC Filings, Public Financial Statements 4 Source: International Energy Agency World Energy Outlook 2022 (A) Non-GAAP financial measure. Visit investors.airproducts.com for 5 Source: Deloitte 2023 Global Green Hydrogen Outlook reconciliation. 6 Science Direct – Direct 2021; Emerging carbon abatement technologies to (B) Certain historical periods presented in the chart above were updated mitigate energy-carbon footprint- a review subsequent to filing the respective Annual Report on Form 10-K with the 7 Ownership value based on APD share price as of 12/13/2024 Securities and Exchange Commission. Fiscal years 2014 through 2016 reflect classification of the PMD and EMD businesses as discontinued operations due 8 Based on $25.2B market capitalization on June 30, 2014 (one day prior to to their separation in FY2017. Fiscal years 2014 through 2017 reflect first day as CEO) and December 13, 2024 retrospective application of the presentation requirements set forth in 9 Permission to use quote neither sought nor obtained Accounting Standards Update (“ASU”) No. 2017-07, “Compensation— Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic 10 TSR Reflects dividend-adjusted total return percentage over tenure or as of Pension Cost and Net Periodic Postretirement Benefit Cost. 12/13/2024 for current positions (C) Reflects latest LTM period available. For Air Products and Linde, reflects 11 United States of America v. John Kenneth Davidson, Case No. 19-cr-56, filed 9/30/24 LTM. For Nippon Sanso, reflects 10/31/24 LTM. For Air Liquide, reflects on February 25, 2019. Transcript Dated March 5, 2019. 12/31/23 LTM 12 Nolan Clay, The Oklahoman, February 27, 2019, “FBI insider trading probe For Charts 6 and 7 results in criminal charge in Oklahoma City federal court“ (A) Science Direct – Direct 2021; Emerging carbon abatement technologies to 13 Securities and Exchange Commission v. Special et al, Case No. 19-cv-1152, mitigate energy-carbon footprint- a review filed on December 12, 2019. (B) Hydrogen Council and McKinsey & Company – November 2021; Hydrogen Sources for Chart 1: Company Filings, Company Press Releases, Capital IQ for Net-Zero| A critical cost-competitive energy vector (A) Based on GAAP sales CAGR from 9/30/14 to 9/30/24 as reclassified to give effect to divestitures of the PMD and EMD businesses. (B) Nippon Sanso based on CAGR from 3/31/18 to 3/31/25(E) and is adjusted for its acquisition of Praxair European assets. Starting revenue data-point is converted to USD at historical FX rate. Latest revenue data-point converted to USD at current FX rate.