8 EXHIBIT 99.1 FORM 11-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) [ x ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1996 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from ________ to _______ Commission file numbers: 33-25419 and 33-64058 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: Airgas, Inc. 401(k) Plan B. Name of the issuer of the securities held pursuant to the plan and the address of its principal executive office: Airgas, Inc. 259 Radnor-Chester Road, Suite 100 Radnor, PA 19087 9 REQUIRED INFORMATION (1) Financial Statements: The following financial statements, including Independent Auditors' Report thereon of Airgas, Inc. 401(k) Plan are submitted herewith: Statements of Net Assets Available for Benefits as of December 31, 1996 and 1995 Statements of Changes in Net Assets Available for Benefits for the three years ended December 31, 1996 Notes to Financial Statements Item 27(a) - Schedule of Assets Held for Investment Purposes Item 27(d) - Schedule of Reportable Transactions The schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission are included in the aforementioned financial statements of the Airgas, Inc. 401(k) Plan. Signatures __________ Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan Administrator has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. AIRGAS, INC. 401(k) PLAN BY:/s/ 401(k) Plan Committee _________________________ BY:/s/ Todd R. Craun __________________________ Member of Plan Committee DATED: June 27, 1997 10 AIRGAS, INC. 401(k) PLAN Financial Statements and Supplementary Schedules December 31, 1996 and 1995 (With Independent Auditors' Report Thereon) 11 AIRGAS, INC. 401(k) PLAN Table of Contents December 31, 1996 and 1995 ______________________________________________________________________________ Page Independent Auditors' Report . . . . . . . . . . . . . . . . . . . 12 Financial Statements: Statement of Net Assets Available for Benefits as of December 31, 1996 . . . . . . . . . . . . . . . . . . . 13 Statement of Net Assets Available for Benefits as of December 31, 1995 . . . . . . . . . . . . . . . . . . . 14 Statement of Changes in Net Assets Available for Benefits, Year ended December 31, 1996 . . . . . . . . . . . 15 Statement of Changes in Net Assets Available for Benefits, Year ended December 31, 1995 . . . . . . . . . . . 16 Statement of Changes in Net Assets Available for Benefits, Year ended December 31, 1994 . . . . . . . . . . . 17 Notes to Financial Statements . . . . . . . . . . . . . . . . . . 18 Schedule 1 Item 27(a) - Schedule of Assets Held for Investment Purposes . . . . . . . . . . . . . . . . . . . . . . 25 2 Item 27(d) - Schedule of Reportable Transactions . . . 26 12 Independent Auditors' Report The Plan Administrator Airgas, Inc. 401(k) Plan: We have audited the accompanying statements of net assets available for benefits of the Airgas, Inc. 401(k) Plan as of December 31, 1996 and 1995, and the related statements of changes in net assets available for benefits for each of the years in the three-year period ended December 31, 1996. In connection with our audits of the accompanying statements, we also have audited the supplemental schedule of assets held for investment purposes (Schedule 1) and the supplemental schedule of reportable transactions (Schedule 2) as of and for the year ended December 31, 1996. These financial statements and supplemental schedules are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements and supplemental schedules based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Airgas, Inc. 401(k) Plan at December 31, 1996 and 1995 and the changes in net assets available for benefits for each of the years in the three-year period ended December 31, 1996, in conformity with generally accepted accounting principles. Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of assets held for investment purposes and reportable transactions as of and for the year ended December 31, 1996 are presented for additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedules have been subjected to the auditing procedures applied in the audits of the basic financial statements, and in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. Philadelphia, Pennsylvania KPMG Peat Marwick LLP June 12, 1997 13 AIRGAS, INC. 401(k) PLAN Statement of Net Assets Available for Benefits December 31, 1996 Vanguard Fidelity Fidelity Airgas,Inc. Guaranteed Money Magellan Puritan Common Investment Market Loan Fund Fund Stock Contracts Account Fund Total ______________________________________________________________________________________________________ Assets: Investments (note 3) $12,358,950 7,406,370 45,051,490 14,072,118 895,667 - 79,784,595 Receivables: Employee contributions - - - - 691,596 - 691,596 Employer contributions - - - - 187,379 - 187,379 _______________________________________________________________________________________________________ Total Receivables - - - - 878,975 - 878,975 Employee loans - - - - - 2,884,144 2,884,144 Cash and cash equivalent, interest-bearing (note 4) 418,096 437,926 373,279 3,195,694 - - 4,424,995 _______________________________________________________________________________________________________ Total assets 12,777,046 7,844,296 45,424,769 17,267,812 1,774,642 2,884,144 87,972,709 _______________________________________________________________________________________________________ Benefits payable (123,165) (100,620) (1,076,515) (541,707) - - (1,842,007) Interfund balances (478,497) (262,999) 1,044,232 (302,736) - - - _______________________________________________________________________________________________________ Net assets available for benefits $12,175,384 7,480,677 45,392,486 16,423,369 1,774,642 2,884,144 86,130,702 ======================================================================================================= <FN> See accompanying notes to financial statements. </FN> 14 AIRGAS, INC. 401(k) PLAN Statement of Net Assets Available for Benefits December 31, 1995 Fidelity Fidelity Airgas,Inc. Guaranteed Magellan Puritan Common Investment Loan Fund Fund Stock Contracts Fund Total ______________________________________________________________________________________________________ Assets: Investments (note 3) $ 9,707,996 5,218,360 30,614,505 16,354,550 - 61,895,411 Accrued investment income 561,377 - - - - 561,377 Receivables: Employee contributions 95,460 61,994 207,674 112,451 - 477,579 Employer contributions 28,105 18,160 64,248 36,649 - 147,162 ______________________________________________________________________________________________________ Total Receivables 123,565 80,154 271,922 149,100 - 624,741 Employee loans - - - - 1,907,396 1,907,396 Cash and cash equivalent, interest-bearing (note 4) 153,441 86,002 319,063 114,051 - 672,557 ______________________________________________________________________________________________________ Total assets 10,546,379 5,384,516 31,205,490 16,617,701 1,907,396 65,661,482 ______________________________________________________________________________________________________ Interfund balances (28,886) (8,785) (54,716) (57,113) 149,500 - ______________________________________________________________________________________________________ Net assets available for benefits $10,517,493 5,375,731 31,150,774 16,560,588 2,056,896 65,661,482 ====================================================================================================== <FN> See accompanying notes to financial statements. </FN> 15 AIRGAS, INC. 401(k) PLAN Statement of Changes in Net Assets Available for Benefits Year ended December 31, 1996 Vanguard Fidelity Fidelity Airgas,Inc. Guaranteed Money Magellan Puritan Common Investment Market Loan Fund Fund Stock Contracts Account Fund Total ______________________________________________________________________________________________________ Investment income: Unrealized gain (loss) on investments $ (623,379) 34,480 7,401,685 - - - 6,812,786 Realized gain on investments 1,939,025 882,214 2,489,040 - - - 5,310,279 Interest - - - 915,371 2,529 164,234 1,082,134 Earnings on liquidity fund 16,411 5,253 5,607 59,253 - - 86,524 ______________________________________________________________________________________________________ 1,332,057 921,947 9,896,332 974,624 2,529 164,234 13,291,723 Contributions: Employee 1,218,082 816,838 2,533,976 1,215,395 1,395,176 - 7,179,467 Employer matching 348,533 234,936 756,945 393,322 376,937 - 2,110,673 Employee rollovers 617,131 610,223 753,493 469,465 - - 2,450,312 Employer discretionary 497,588 316,830 1,280,847 963,376 - - 3,058,641 ______________________________________________________________________________________________________ 2,681,334 1,978,827 5,325,261 3,041,558 1,772,113 - 14,799,093 Benefits paid to participants (952,025) (507,591) (3,342,119)(2,658,855) - (161,006) (7,621,596) Interfund transfers, including loans granted, net of loan repayments(1,403,475) (288,237) 2,362,238 (1,494,546) - 824,020 - ______________________________________________________________________________________________________ Net change to plan 1,657,891 2,104,946 14,241,712 (137,219) 1,774,642 827,248 20,469,220 Net assets available for benefits: Beginning of year 10,517,493 5,375,731 31,150,774 16,560,588 - 2,056,896 65,661,482 ______________________________________________________________________________________________________ End of year $12,175,384 7,480,677 45,392,486 16,423,369 1,774,642 2,884,144 86,130,702 ====================================================================================================== <FN> See accompanying notes to financial statements. </FN> 16 AIRGAS, INC. 401(k) PLAN Statement of Changes in Net Assets Available for Benefits Year ended December 31, 1995 Fidelity Fidelity Airgas,Inc. Guaranteed Magellan Puritan Common Investment Loan Fund Fund Stock Contracts Fund Total ______________________________________________________________________________________________________ Investment income: Unrealized gain on investments $ 1,588,404 503,817 9,420,913 - - 11,513,134 Realized gain on investments 731,951 271,336 1,013,670 - - 2,016,957 Interest - - - 936,130 129,340 1,065,470 Earnings on liquidity fund 2,716 2,208 9,874 11,041 5,409 31,248 ______________________________________________________________________________________________________ 2,323,071 777,361 10,444,457 947,171 134,749 14,626,809 Contributions: Employee 997,987 665,728 2,477,682 1,327,851 - 5,469,248 Employer matching 295,491 194,826 735,918 430,670 - 1,656,905 Employee rollovers 647,978 290,306 689,079 1,372,380 - 2,999,743 Employer discretionary 462,835 286,027 1,318,720 1,026,967 - 3,094,549 ______________________________________________________________________________________________________ 2,404,291 1,436,887 5,221,399 4,157,868 - 13,220,445 Benefits paid to participants (501,335) (332,633) (1,445,290) (1,716,543) (90,361) (4,086,162) Interfund transfers, including loans granted, net of loan repayments 450,936 408,172 (707,900) (835,272) 684,064 - ______________________________________________________________________________________________________ Net change to plan 4,676,963 2,289,787 13,512,666 2,553,224 728,452 23,761,092 Net assets available for benefits: Beginning of year 5,840,530 3,085,944 17,638,108 14,007,364 1,328,444 41,900,390 ______________________________________________________________________________________________________ End of year $10,517,493 5,375,731 31,150,774 16,560,588 2,056,896 65,661,482 ====================================================================================================== <FN> See accompanying notes to financial statements. </FN> 17 AIRGAS, INC. 401(k) PLAN Statement of Changes in Net Assets Available for Benefits Year ended December 31, 1994 Fidelity Fidelity Airgas,Inc. Guaranteed Magellan Puritan Common Investment Loan Fund Fund Stock Contracts Fund Total ______________________________________________________________________________________________________ Investment income: Unrealized loss on investments $ (249,470) (197,963) (2,096,563) - - (2,543,996) Realized gain on investments 194,849 226,572 807,731 - - 1,229,152 Interest - - - 829,141 96,620 925,761 Earnings on liquidity fund 1,089 438 6,593 5,713 - 13,833 ______________________________________________________________________________________________________ (53,532) 29,047 (1,282,239) 834,854 96,620 (375,250) Contributions: Employee 760,133 464,951 2,090,522 1,284,816 - 4,600,422 Employer matching 231,279 141,781 624,697 424,422 - 1,422,179 Employee rollovers 1,082,489 585,644 1,404,722 1,140,953 - 4,213,808 Employer discretionary 315,787 157,226 871,181 915,786 - 2,259,980 ______________________________________________________________________________________________________ 2,389,688 1,349,602 4,991,122 3,765,977 - 12,496,389 Benefits paid to participants (260,337) (165,234) (1,031,362) (895,317) (47,953) (2,400,203) Interfund transfers, including loans granted, net of loan repayments 109,123 51,318 2,406,878 (2,872,135) 304,816 - ______________________________________________________________________________________________________ Net change to plan 2,184,942 1,264,733 5,084,399 833,379 353,483 9,720,936 Net assets available for benefits: Beginning of year 3,655,588 1,821,211 12,553,709 13,173,985 974,961 32,179,454 ______________________________________________________________________________________________________ End of year $ 5,840,530 3,085,944 17,638,108 14,007,364 1,328,444 41,900,390 ====================================================================================================== <FN> See accompanying notes to financial statements. </FN> 18 AIRGAS, INC. 401(k) PLAN Notes to Financial Statements (1) Description of the Plan The following description of the Airgas, Inc. 401(k) Plan (the Plan) provides general information only. Participants should refer to the Plan agreement for more complete information. General The Plan is a defined contribution plan covering substantially all employees of Airgas, Inc. and subsidiaries (the Company). Included in the assets of the Plan are contribution rollovers from pension plans of acquired companies, where applicable. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). Contributions Employee: The Plan permits a participant to defer up to 15% of eligible compensation. The amount of deferred compensation is treated as a salary reduction and is not subject to federal income tax until withdrawn from the Plan. In no event will the contribution exceed maximum allowable contributions as prescribed by the Internal Revenue Service. Employer: Contributions to the Plan by the Company are made on a matched basis and at a rate of 50% of participant deferred compensation. The employer match is applied on employee contributions of up to 4% of eligible compensation (i.e., maximum employer match is 2% of eligible compensation). Plan participants are eligible for Company contributions one year after their date of hire. The amount of discretionary contributions, in addition to the required Company match, elected to be made by the Company are determined by the Board of Directors. Participant Accounts Contributions are invested as directed by each participant in four separate investment funds. Each participant may designate, by written notice to the Plan administrator, how the contributions to their account are to be allocated among the four funds. Participants are required to allocate funds in increments of 25% of total contributions. November and December Plan contributions have been deposited in the Vanguard Money Market account in order to facilitate the transfer of the Plan assets to the new trustee and investment options (see note 7). In the event a participant fails to submit a written notice of allocation, contributions will be invested in the Guaranteed Investment Contracts. 19 (1) Continued In addition to the above initial election, each quarter participants may elect by written notice to transfer all or 25% increments of the total funds credited to their account to any one or more of the investment funds. Interest, dividends, and other income earned by the investment funds are reinvested in the same fund. Such amounts are allocated to participants based upon the proportion of a participant's balance to the total fund balance. Participant Loans The Plan administrator may, upon the application of a participant, direct the Trustee to make a loan to such participant. The loan will bear interest at a rate equal to prime plus 2% and shall provide for periodic repayment over a reasonable period of time generally not to exceed five years for general purpose loans and 30 years for principal residence loans. Prime rate at December 31, 1996 was 8.25%. Vesting Participants are immediately vested in all contributions. In addition, all earnings on such investments are fully vested. Payment of Benefits Upon retirement, death, disability, or termination of service, participants or beneficiaries are entitled to a distribution equal to the total value of their accounts. Such distributions are generally payable in cash. Participants experiencing serious financial hardships may be entitled to a distribution upon approval of the Plan administrator. Administrative Expenses All administrative expenses have been paid by the Company. (2) Summary of Significant Accounting Policies Basis of Accounting The accompanying financial statements of the Plan have been prepared on the accrual basis of accounting and present net assets available for benefits and changes in those assets. 20 (2) Continued Investments The Plan's investments are maintained by the plan trustee, CoreStates Bank. The fair values of the Fidelity Magellan Fund and the Fidelity Puritan Fund are based on net asset values per share at year-end. The Guaranteed Investment Contracts are valued at year-end contract values. Contract value represents contributions made under the contract, plus interest at the contract rate, less funds used to pay administration expense charged by the insurance company. Investments in Airgas, Inc. common stock are valued at market based upon closing prices at the Plan year-end. At December 31, 1996, the investment in Airgas, Inc. common stock had 3,433 Plan participants invested in the common stock. The value per share was $22.00 at December 31, 1996. The Fidelity Magellan Fund seeks long-term capital appreciation by making a profit on invested capital over the long-term. The fund invests in common stock, and securities convertible to common stock, issued by companies operating in the U.S. or as foreign companies. Investments are diversified among large and small corporations in a variety of industries and sectors within the market. At December 31, 1996, the Fidelity Magellan Fund had 2,108 Plan participants invested in the fund. The value per share was $80.65 at December 31, 1996. The Fidelity Puritan Fund is a managed stock and bond fund which seeks to obtain as much income as possible, consistent with the preservation and conservation of capital. The fund invests in a broad list of securities, including common stock, preferred stock and bonds, including high-yield, low-quality bonds. At December 31, 1996, the Fidelity Puritan Fund had 1,709 Plan participants invested in the fund. The value per share was $17.24 at December 31, 1996. Guaranteed Investment Contracts (GICs) are invested in the guaranteed interest rate contracts of major insurance companies. Each contract provides a fixed interest rate for a stated period of time. At December 31, 1996, the GICs had 2,489 Plan participants invested in the contracts (see note 7). The Vanguard Money Market Account invests in short-term, high quality money market investments issued by financial institutions, non-financial corporations, the U.S. government, and federal agencies. November and December Plan contributions have been deposited in this account in order to facilitate the transfer of the Plan assets to the new trustee and investment options (see note 7). All participants who contributed to the Plan in these months invested in this fund. Use of Estimates The preparation of the financial statements in accordance with generally accepted accounting principles require the plan administrators to make estimates that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts included in the statement of changes in net assets available for plan benefits. Actual results could differ from those estimates. 21 (3) Investments The following presents fair value of investments and the contract value of GICs held at December 31, 1996 and 1995: December 31, 1996 Fair/ Number Contract of Shares Investments Cost Value _________ ___________ ____ ________ Mutual Funds: 153,241 Fidelity Magellan Fund $11,434,465 12,358,950 429,604 Fidelity Puritan Fund 7,002,598 7,406,370 ____________________________________________________________________________ 18,437,063 19,765,320 ____________________________________________________________________________ Common Stock: 2,047,795 Airgas, Inc. Common Stock 23,272,216 45,051,490 ____________________________________________________________________________ Guaranteed Investment Contracts: American International Life Assurance Co. Investment Contract, 5.06% due 1/99 3,126,007 3,126,007 Hartford Insurance Group Guaranteed Investment Contract, 7.56%, due 12/97 549,801 549,801 Confederation Guaranteed Investment Contract, 8.21%, due 12/95 (note 7) 1,039,957 1,039,957 Great West Life Guaranteed Investment Contracts, 5.85% to 6.75%, due 1/97 to 7/97 3,537,905 3,537,905 John Hancock Guaranteed Investment Contracts, 5.31% to 7.02%, due 5/98 to 5/99 2,955,056 2,955,056 Continental Assurance Co. Guaranteed Investment Contract, 6.64%, due 5/98 2,863,392 2,863,392 ____________________________________________________________________________ 14,072,118 14,072,118 ____________________________________________________________________________ Short-term Investment: Vanguard Money Market Account 895,667 895,667 ____________________________________________________________________________ $56,677,064 79,784,595 ____________________________________________________________________________ 22 (3) Continued December 31, 1995 Fair/ Number Contract of Shares Investments Cost Value _________ ___________ ____ ________ Mutual Funds: 112,910 Fidelity Magellan Fund $ 8,160,132 9,707,996 306,782 Fidelity Puritan Fund 4,849,068 5,218,360 ____________________________________________________________________________ 13,009,200 14,926,356 ____________________________________________________________________________ Common Stock: 920,737 Airgas, Inc. Common Stock 16,236,916 30,614,505 ____________________________________________________________________________ Guaranteed Investment Contracts: Capital Holdings Guaranteed Investment Contract, 8.51% due 1/96 207,622 207,622 Hartford Insurance Group Guaranteed Investment Contracts, 7.50% to 7.90%, due 12/95 to 12/97 878,513 878,513 Confederation Guaranteed Investment Contract, 8.21%, due 12/95 1,039,957 1,039,957 Great West Life Guaranteed Investment Contracts, 5.6% to 8.07% due 12/95 to 7/97 6,170,938 6,170,938 John Hancock Guaranteed Investment Contracts, 5.31% to 8.57%, due 3/96 to 5/99 3,305,388 3,305,388 New York Life Guaranteed Investment Contract, 7.14%, due 10/96 1,967,497 1,967,497 Continental Assurance Co. Guaranteed Investment Contract, 6.64%, due 5/98 2,784,635 2,784,635 ____________________________________________________________________________ 16,354,550 16,354,550 ____________________________________________________________________________ $45,600,666 61,895,411 ____________________________________________________________________________ 23 (3) Continued Changes in unrealized appreciation are summarized as follows: 1996 1995 1994 ______________________________________________________________________________ Unrealized appreciation at January 1 $16,294,745 $4,781,611 7,325,607 Unrealized gains (losses) on investments: Fidelity Magellan Fund (623,379) 1,588,404 (249,470) Fidelity Puritan Fund 34,480 503,817 (197,963) Airgas, Inc. Common Stock 7,401,685 9,420,913 (2,096,563) ______________________________________________________________________________ Unrealized appreciation at December 31 $23,107,531 $16,294,745 4,781,611 ______________________________________________________________________________ During 1996, the Plan's investments (including investments bought, sold, and held during the year) appreciated by $12,123,065 as follows: Fidelity Magellan Fund $ 1,315,646 Fidelity Puritan Fund 916,694 Airgas, Inc. Common Stock 9,890,725 _____________________________________________________ $ 12,123,065 __________ Realized gain on the Fidelity Magellan Fund and the Fidelity Puritan Fund investments includes the realized gain on the sale of investments and the realized investment income within these funds. The average cost method is followed in determining the cost of investments sold. The average yield earned on the Guaranteed Investment Contracts (GICs) was approximately 5.6% and 6.1% for the years ended December 31, 1996 and 1995 respectively. The crediting interest rates ranged from 5.06% to 7.56% as of December 31, 1996 and from 5.31% to 8.57% as of December 31, 1995. The fair value of the GICs was $14,042,957 at December 31, 1996. The following investments represent 5% or more of participants' equity at December 31, 1996: Percentage of Participants' Fair Value Equity ______________________________________________________________________________ Fidelity Magellan Fund $12,358,950 14 % Fidelity Puritan Fund 7,406,370 9 Airgas, Inc. Common Stock 45,051,490 54 Corestates Liquidity Fund 4,424,995 5 ______________________________________________________________________________ 24 (4) Cash and Cash Equivalent Cash and cash equivalent consists principally of amounts invested in the CoreStates Liquidity Fund which invests in corporate bonds and U.S. Treasury Bills with maturities of three months or less. (5) Federal Income Taxes The Plan has received a letter of favorable determination for tax qualification from the Internal Revenue Service dated January 23, 1996. Accordingly, the Plan is a qualified trust under section 401(a) of the Internal Revenue Code and, thus, is exempt from federal income taxes under section 501(a) of the Internal Revenue Code as of December 31, 1996. Effective January 1, 1997, the Plan was amended. See note 7. (6) Plan Termination Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. (7) Subsequent Events In August 1994, the assets of Confederation Life Insurance Company were placed under the regulatory supervision of the Michigan Commissioner of Insurance. The Confederation Life Guaranteed Investment Contract (GIC) was subject to certain regulatory restrictions, and thus the Plan management ceased accruing interest on the funds. In March 1997 the rehabilitation plan of the assets was finalized. The rehabilitation plan provides for receipt of 100% of the August 1994 value into the Plan plus interest earned between the liquidation plan's asset valuation date and the actual distribution date. The rehabilitation plan also provides for the distribution of certain contingent assets, such as litigation proceeds, to GIC investors in the future as they may become available. The Company's Midwest Carbide Corporation subsidiary adopted the Keokuk Bargaining Unit 401(k) Plan (the Keokuk Plan) effective January 1, 1988 for the benefit of certain of its employees. Effective January 1, 1997, the Company amended and restated the Plan to provide for the merger of the Keokuk Plan with and into the Plan. This amendment is subject to the subsequent condition that the Internal Revenue Service issues a favorable determination for tax qualification. Effective January 31, 1997, the Plan changed its trustee to the Vanguard Group. The Plan also changed its investment options, keeping only the Airgas Common Stock Fund and the GIC Fund (renamed the Investment Contract Fund) and adding ten Vanguard funds. Plan assets were fully transferred to the new investments by April 1997 in accordance with participant elections. Additionally, effective January 1, 1997, administrative expenses are paid by the Plan. 25 Schedule 1 AIRGAS, INC. 401(k) PLAN Item 27(a) - Schedule of Assets Held For Investment Purposes December 31, 1996 ______________________________________________________________________________ Fair/ Number Contract of Shares Investments Cost Value _________ ___________ ____ ________ Mutual Funds: 153,241 Fidelity Magellan Fund $11,434,465 12,358,950 429,604 Fidelity Puritan Fund 7,002,598 7,406,370 ____________________________________________________________________________ 18,437,063 19,765,320 ____________________________________________________________________________ Common Stock: 2,047,795 Airgas, Inc. Common Stock 23,272,216 45,051,490 ____________________________________________________________________________ Guaranteed Investment Contracts: American International Life Assurance Co. Guaranteed Investment Contract, 5.06%, due 1/99 3,126,007 3,126,007 Hartford Insurance Group Guaranteed Investment Contract, 7.56% due 12/97 549,801 549,801 Confederation Guaranteed Investment Contract, 8.21%, due 12/95 1,039,957 1,039,957 Great West Life Guaranteed Investment Contracts, 5.6% to 8.07% due 12/95 to 7/97 3,537,905 3,537,905 John Hancock Guaranteed Investment Contracts, 5.31% to 8.57%, due 3/96 to 5/99 2,955,056 2,955,056 Continental Assurance Co. Guaranteed Investment Contract, 6.64%, due 3/98 2,863,392 2,863,392 ____________________________________________________________________________ 14,072,118 14,072,118 ____________________________________________________________________________ Employee Loans 2,884,144 2,884,144 ____________________________________________________________________________ Short-term Investment: Vanguard Money Market Account $ 895,667 895,667 ____________________________________________________________________________ $59,561,208 82,668,739 ____________________________________________________________________________ 26 Schedule 2 AIRGAS, INC. 401(k) PLAN Item 27(d) - Schedule of Reportable Transactions Year ended December 31, 1996 ____________________________________________________________________________________________________ During the year ended December 31, 1996, the Plan had the following reportable transactions by issue: Net Identity of Description Transaction Purchase Selling gain party involved of asset type Price Price (loss) ____________________________________________________________________________________________________ Fidelity Investment Magellan Mutual Fund Purchases $1,264,923 - - Sales 648,149 688,110 39,961 Fidelity Investment Puritan Mutual Fund Purchases 751,722 - - Sales - - - CoreStates Bank CoreStates Purchases 19,891,238 - - Liquidity Fund Sales 18,477,699 18,477,691 - Continental Assurance Guaranteed Investment Purchases - - - Company Contract Sales 4,159,913 4,159,913 - _____________________________________________________________________________________________________