Note 12 Leases

For operating leases, primarily involving manufacturing and distribution equipment and office space, noncancelable commitments extending for more than one year will require the following future minimum payments at December 31, 2000:

*Excludes $16 million related to the 2000 repositioning and special charges (see Note 2).

Included in these totals are $45 million of lease commitments to Praxair's former parent company, principally for office space. Total lease and rental expenses under operating leases were $95 million in 2000, $94 million in 1999 and $80 million in 1998, excluding $16 million related to the 2000 repositioning and special charges (see Note 2). The present value of the future lease payments under operating leases is approximately $328 million at December 31, 2000.

During 1999 and 1998, Praxair sold and leased back certain U.S. distribution and liquid storage equipment for $80 million and $150 million, respectively. These operating leases have an initial two-year term with purchase and lease renewal options at projected future fair market values beginning in 2001 and 2000, respectively. In September 2000, Praxair renewed the $150 million operating lease for an additional year. In December 2000, Praxair notified the lessor of its intent to renew the $80 million operating lease commencing March 2001.