SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
/x/ ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934. For the fiscal year ended December 31, 2000.
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
Commission file number 001-10351
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
PCS U.S. Employees' Savings Plan
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
Potash Corporation of Saskatchewan Inc.
122 - 1st Avenue South
Saskatoon, Saskatchewan, Canada S7K 7G3
PCS U.S.
Employees' Savings Plan
Financial Statements as of
December 31, 2000 and 1999
and for the Year Ended
December 31, 2000,
Supplemental Schedule as of
December 31, 2000, and
Independent Auditors' Report
PCS U.S. EMPLOYEES' SAVINGS PLAN
TABLE OF CONTENTS
--------------------------------------------------------------------------------
Page
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS AS OF
DECEMBER 31, 2000 AND 1999 AND
FOR THE YEAR ENDED DECEMBER 31, 2000
Statements of Net Assets Available for Benefits 2
Statement of Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4-7
SUPPLEMENTAL SCHEDULE AS OF DECEMBER 31, 2000
Schedule H - Part IV-Line 4i - Schedule of Assets Held for
Investment Purposes At End of Year 8
(Supplemental schedules not listed are omitted due to the absence of conditions
under which they are required.)
INDEPENDENT AUDITORS' REPORT
To the Plan Administrator and Participants of the
PCS U.S. Employees' Savings Plan:
We have audited the accompanying statements of net assets available for benefits
of the PCS U.S. Employees' Savings Plan (the "Plan") as of December 31, 2000 and
1999, and the related statement of changes in net assets available for benefits
for the year ended December 31, 2000. These financial statements are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. 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, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
2000 and 1999, and the changes in net assets available for benefits for the year
ended December 31, 2000 in conformity with accounting principles generally
accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
for investment purposes at end of year, as of December 31, 2000 is presented for
the purpose of additional analysis and is not a required part of the basic
financial statements but is 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. This schedule is the responsibility of
the Plan's management. Such schedule has been subjected to the auditing
procedures applied in the audit of the basic 2000 financial statements and, in
our opinion, is fairly stated in all material respects when considered in
relation to the basic financial statements taken as a whole.
/s/ Deloitte & Touche LLP
May 29, 2001
1
PCS U.S. EMPLOYEES' SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 2000 AND 1999
--------------------------------------------------------------------------------
2000 1999
----------------- -----------------
INVESTMENTS, AT FAIR VALUE (Note 3) $212,750,599 $171,249,663
----------------- -----------------
NET ASSETS AVAILABLE FOR BENEFITS $212,750,599 $171,249,663
================= =================
See notes to financial statements.
2
PCS U.S. EMPLOYEES' SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 2000
-------------------------------------------------------------------------------------
ADDITIONS
Contributions
Participants $10,248,613
Employer, net 4,792,813
--------------
Total Contributions 15,041,426
Investment Income
Net depreciation in fair value
of investments (Note 3) (22,066,942)
Interest and dividends 15,677,848
Interest - participant notes receivable 490,758
Dividends - PCS Common Stock 143,326
--------------
Total Investment Income (5,755,010)
--------------
TOTAL ADDITIONS 9,286,416
DEDUCTIONS
Benefits paid 35,682,579
Administrative expenses 69,454
--------------
TOTAL DEDUCTIONS 35,752,033
---------------
TRANSFERS (TO) FROM OTHER PLANS
White Springs Agricultural Chemicals Inc.
Savings & Investment Plan for
Collective Bargaining Employees 13
MOAB Salt, L.L.C. Employees' Savings Plan (Note 6) (1,302,349)
PCS Nitrogen 401(K) Savings Plan (Note 5) 69,268,889
--------------
67,966,553
NET ASSETS AVAILABLE FOR BENEFITS:
BEGINNING OF THE YEAR 171,249,663
----------------
END OF THE YEAR $212,750,599
================
See notes to financial statements.
3
PCS U.S. EMPLOYEES' SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2000 AND 1999 AND
FOR THE YEAR ENDED DECEMBER 31, 2000
--------------------------------------------------------------------------------
1. DESCRIPTION OF PLAN
The following description of the PCS U.S. Employees' Savings Plan (the
"Plan") provides only general information. Participants should refer to
the Plan agreement for a more complete description of the Plan's
provisions.
General - The Plan is a defined contribution plan sponsored by PCS
Administration (USA), Inc. (the "Company") covering all employees of
the Company, PCS Phosphate Company, Inc., PCS Sales (USA), Inc.,
certain employees of White Springs Agricultural Chemicals, Inc. and
certain employees of PCS Nitrogen. It is subject to the provisions of
the Employee Retirement Income Security Act of 1974 ("ERISA").
Contributions - Participants may contribute up to 20 percent of base
compensation each year, as defined in the Plan. Participants may also
contribute amounts representing distributions from other qualified
defined benefit or contribution plans. The Company matches 100 percent
of the first five percent of base compensation that participants
contribute to the Plan. Contributions are subject to certain
limitations as described in the Plan agreement and the Internal Revenue
Code.
Participant Accounts - Individual accounts are maintained for each Plan
participant. Each participant's account is credited with the
participant's contribution, the Company's contribution, and allocations
of plan earnings, and is charged with an allocation of plan losses and
administrative expenses. Allocations are based on participant earnings
or account balances, as defined in the Plan. The benefit to which a
participant is entitled is the benefit that can be provided from the
participant's vested account.
Vesting - Participants are immediately vested in their account
balances.
Investments - Participants direct the investment of their account
balances and contributions into various investment options offered by
the Plan. The Plan currently offers Potash Corporation of Saskatchewan
Inc. Common Stock, eight mutual funds, and one fixed interest fund as
investment options for participants. The fixed interest fund is
comprised of two insurance investment contracts and a pooled investment
stable value fund which invests in fixed interest insurance investment
contracts, money market funds, corporate and government bonds,
mortgage-backed securities, bond funds, and other fixed income
securities.
4
Loans to Participants - Participants may borrow from their fund
accounts up to a maximum amount equal to the lesser of $50,000 or 50
percent of their vested account balance. Loan terms range from one to
five years or up to 20 years for the purchase of a primary residence.
The loans are secured by the balance in the participant's account and
bear interest at two percentage points above the rate for five-year
U.S. Treasury Notes. Loans for the purchase of a primary residence bear
interest at the standard lending rate for 20-year fixed rate home
mortgage loans. Principal and interest are paid ratably through monthly
payroll deductions.
Payment of Benefits - On termination of service, a participant may
elect to receive either a lump-sum amount equal to the value of the
participant's vested interest in his or her account, or annual
installments over the participant's estimated life span. A participant
may elect to receive payment of benefits prior to termination of
service, as defined in the Plan. Amounts allocated to accounts of
participants who have elected to withdraw from the plan but have not
yet been paid were approximately $-0- and $833,000 at December 31, 2000
and 1999, respectively.
2. SUMMARY OF ACCOUNTING POLICIES
Basis of Accounting - The financial statements of the Plan are prepared
under the accrual method of accounting.
Use of Estimates - The preparation of financial statements in
conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and assumptions
that affect the reported amounts of assets, liabilities, and changes
therein, and disclosure of contingent assets and liabilities. Actual
results could differ from those estimates. The Plan utilizes various
investment instruments. Investment securities, in general, are exposed
to various risks, such as interest rate, credit, and overall market
volatility. Due to the level of risk associated with certain investment
securities, it is reasonably possible that changes in the values of
investment securities will occur in the near term and that such changes
could materially affect the amounts reported in the statements of net
assets available for plan benefits.
Investment Valuation and Income Recognition - The Plan's investment are
stated at fair value. Shares of registered investment companies are
valued at quoted market prices which represent the net asset value of
shares held by the Plan at year-end. The Fixed Interest Fund is valued
at the amount of participant and Company contributions plus actual
earnings thereon due to its ability to meet participant investment
election and participant benefits out of fully benefit responsive
investments. Such amount approximates fair value. Participants notes
receivable are valued at cost which approximates fair value. Purchases
and sales of securities are recorded on a trade-date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on the
ex-dividend date.
Payment of Benefits - Benefits are recorded when paid.
Expenses - The Plan's administrative expenses are paid by the plan and
allocated to participants' accounts.
5
3. INVESTMENTS
The Plan's investments which represent five percent or more of the
Plan's net assets available for benefits as of December 31, 2000 and
1999 are as follows:
2000 1999
Fixed Income:
Fidelity Fixed Interest Fund $65,823,561 $65,138,242
Equity:
Fidelity Growth and Income Fund 39,029,772 34,972,517
Fidelity Magellan Fund 25,437,006 27,976,273
Fidelity Spartan U.S. Equity Index Fund 13,634,141 8,095,574
Fidelity Aggressive Growth Fund 27,533,889 18,612,811
Fidelity Puritan Fund 11,437,222 1,970,943
During 2000, the Plan's investments (including investments bought, sold
and held during the year) depreciated in value by $22,066,942:
Fidelity Growth and Income Fund (4,246,533)
Fidelity Magellan Fund (3,676,670)
Fidelity Spartan U.S. Equity Index Fund (1,151,624)
Fidelity Aggressive Growth Fund (15,152,256)
Fidelity Puritan Fund 92,989
Potash Corporation of Saskatchewan Stock 3,541,161
Fidelity Overseas Fund (1,581,036)
Fidelity Inst Sh-Int Govt Fund 107,027
---------------
(22,066,942)
4. INVESTMENT CONTRACT WITH INSURANCE COMPANY
The Fixed Interest Fund is comprised of two investment contracts and a
pooled investment stable value fund which invests in fixed interest
insurance investment contracts, money market funds, corporate and
government bonds, mortgage-backed securities, bond funds, and other
fixed income securities. Participants may ordinarily direct the
withdrawal or transfer of all or a portion of their investment at
contract value.
There are no reserves against contract value for credit risk of the
contract issuer or otherwise. The average yield rates for the years
ended December 31, 2000 and 1999 were approximately 6.2% and 6.0%,
respectively. The crediting interest rates as of December 31, 2000 and
1999 were approximately 5.8% and 5.6%, respectively.
5. TRANSFERS FROM OTHER PLANS
Effective January 1, 2000, certain participants in the PCS Nitrogen 401
(k) Savings Plan (the "PCS Plan"), sponsored by an affiliated company,
became participants in the Plan. During 2000, participant account
balances transferred from the PCS Nitrogen Plan were $69,268,889.
6
6. TRANSFERS TO OTHER PLANS
Effective February 22, 2000, participants who were active employees of
MOAB Salt, Inc. became participants in the MOAB Salt, L.L.C.
Employees' Savings Plan. During 2000, participant account balances
transferred to the MOAB Salt, L.L.C. Employees' Savings Plan were
$1,302,349.
7. RELATED PARTY TRANSACTIONS
Certain Plan investments are shares of mutual funds managed by Fidelity
Management Trust Company ("Fidelity"). Fidelity is the trustee as
defined by the Plan and, therefore, these transactions qualify as
party-in-interest. Fees paid by the Plan for the investment management
services were $66,803 for the year ended December 31, 2000.
8. 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.
9. TAX STATUS
The Plan obtained its latest determination letter dated March 26, 1997,
in which the Internal Revenue Service stated that the Plan, as then
designed, was in compliance with the applicable requirements of the
Internal Revenue Code ("IRC"). The Plan has been amended and restated
since receiving the determination letter. However, the plan
administrator and the plan's tax counsel believe that the Plan is
currently designed and being operated in compliance with the applicable
requirements of the IRC. Therefore, they believe that the Plan was
qualified and the related trust was tax-exempt as of the financial
date. No provision for income taxes has been provided.
7
SCHEDULE H - LINE 4i
PCS U.S. EMPLOYEES' SAVINGS PLAN
SCHEDULE H - PART IV, LINE 4i - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AT END OF YEAR DECEMBER 31, 2000
--------------------------------------------------------------------------------
Description of Investment,
Maturity Date,Interest Rate,
Identity of Issue, Borrower, Collateral, and Par or Maturity
Lessor or Similar Party Value Cost Current Value
----------------------------------------------- ------------------------------------------------- -----------------
Shares of registered investment companies:
* Fidelity Management Trust Company Magellan Fund $25,437,006
* Fidelity Management Trust Company Growth and Income Fund 39,029,772
* Fidelity Management Trust Company Overseas Fund 4,628,839
* Fidelity Management Trust Company Retirement Money Market 5,087,724
* Fidelity Management Trust Company U.S. Government Income Fund 4,121,180
* Fidelity Management Trust Company Aggressive Growth Fund 27,533,889
* Fidelity Management Trust Company Puritan Fund 11,437,222
* Fidelity Management Trust Company Spartan U.S. Equity Index Fund 13,634,140
Potash Corporation of Saskatchewan Common Stock 10,133,393
Fixed Interest Portfolio Monumental Life Insurance Company, 6.4% 169,234
Fixed Interest Portfolio Transamerica Occidental, 5.75% 1,965,325
Fixed Interest Portfolio FMTC US Government Reserve 63,689,002
* Loans to participants Due 2000 through 2020; interest rates ranging
from 5.00% to 9.75% 5,883,873
-----------------
Total assets held for investment $212,750,599
=================
* A party-in-interest as defined by ERISA
8
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
PCS U.S. Employees Savings Plan
-----------------------------------------
(Name of plan)
Date: June 25, 2001 /s/ Barbara Jane Irwin
-------------------------- -----------------------------------------
Barbara Jane Irwin
President, PCS Administration (USA), Inc.
(Plan Administrator)
EXHIBIT INDEX
Exhibit Number Description of Exhibit
------------------------ ----------------------------------------------------
23.1 Consent of Deloitte & Touche, L.L.P.