National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- issuer not required to send an information circular as it is a wholly-owned subsidiary -- issuer required to include certain prescribed executive compensation disclosure in its annual information form -- issuer granted relief from requirement to include certain prescribed executive compensation disclosure in its annual information form as such relevant information will be included in the information circular of the sole shareholder of the issuer -- issuer granted relief from requirement to disclose certain prescribed executive compensation disclosure where such disclosure has not been included in an information circular or annual information form as such information will be included in the information circular of the sole shareholder of the issuer.
Applicable Legislative Provisions
National Instrument 51-102 Continuous Disclosure Obligations, ss. 11.6(1), 13.1.
Form 51-102F2 Annual Information Form, Item 18.1.
Citation: Re Agrium Inc., 2018 ABASC 33
February 22, 2018
IN THE MATTER OF THE SECURITIES LEGISLATION OF ALBERTA AND ONTARIO (the Jurisdictions) AND IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS AND IN THE MATTER OF AGRIUM INC. (the Filer)
The securities regulatory authority or regulator in each of the Jurisdictions (each a Decision Maker) has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the Legislation) exempting the Filer from the requirement: (i) under Item 18.1 of Form 51-102F2 Annual Information Form (Form 51-102F2) that the Filer's 2017 AIF (as defined below) disclose the information required under Item 8 of Form 51-102F5 Information Circular (Form 51-102F5) and Form 51-102F6 Statement of Executive Compensation (Form 51-102F6), where an issuer is not required to send a Form 51-102F5 to any of its securityholders; and (ii) to provide the disclosure required under subsection 11.6(1) of National Instrument 51-102 Continuous Disclosure Obligations (NI 51-102) in respect of the year ended December 31, 2017 where an issuer is not required to send a Form 51-102F5 to any of its securityholders and does not file an AIF (as defined below), that includes the compensation disclosure required by Item 18 of Form 51-102F2 (collectively, the Exemption Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):
(a) the Alberta Securities Commission is the principal regulator for this application;
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in in each of British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador; and
(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Terms defined in National Instrument 14-101 Definitions or MI 11-102 have the same meaning if used in this decision, unless otherwise defined.
This decision is based on the following facts represented by the Filer:
1. The Filer is a corporation governed by the Canada Business Corporations Act (the CBCA) and its head office is located in Calgary, Alberta.
2. The Filer is a reporting issuer in each province of Canada and is not in default of securities legislation in any jurisdiction of Canada.
3. On September 11, 2016, the Filer and PotashCorp Corporation of Saskatchewan Inc. (PotashCorp) entered into an Arrangement Agreement, pursuant to which the Filer and PotashCorp agreed to combine their businesses by way of a statutory arrangement (the Arrangement) under section 192 of the CBCA.
4. The Arrangement, which was completed effective January 1, 2018, resulted in the acquisition of all of the issued and outstanding common shares of the Filer (Agrium Shares) and all of the issued and outstanding common shares of PotashCorp (PotashCorp Shares) by Nutrien Ltd. (Nutrien). Under the Arrangement, the holders of Agrium Shares received 2.23 common shares of Nutrien (Nutrien Shares) for each Agrium Share and the holders of PotashCorp Shares received 0.40 Nutrien Shares for each PotashCorp Share.
5. As a result of the Arrangement, Agrium and PotashCorp became indirect, wholly-owned subsidiaries of Nutrien, which is continuing the operations of Agrium and PotashCorp on a combined basis.
6. All of the outstanding senior notes of Agrium (Agrium Notes) remain outstanding. The Agrium Notes are not listed for trading on any exchange.
7. The Filer will remain a reporting issuer in each province of Canada until an application is made by the Filer to cease reporting in Canada. In the United States, the Filer does not have any statutory reporting obligations with the exception of certain post-closing filings in respect of the financial year ended 2017. The Filer continues to report in the United States as a "foreign private issuer" pursuant to the applicable covenants in the indentures governing the Agrium Notes.
8. On January 2, 2018, the Agrium Shares were delisted from trading on the Toronto Stock Exchange (TSX) and were subsequently delisted from the New York Stock Exchange (NYSE). On January 2, 2018, the Nutrien Shares were listed and posted for trading on the TSX and the NYSE under the symbol "NTR".
9. Due to the effective date of the Arrangement being January 1, 2018, the Filer was a reporting issuer, but not a "venture issuer" (as defined in NI 51-102), in each province of Canada as of December 31, 2017. Accordingly, the Filer is required to file an annual information form prepared in accordance with NI 51-102 and Form 51-102F2 (an AIF) for the year ended December 31, 2017 (the 2017 AIF).
10. Item 18.1 of Form 51-102F2 requires reporting issuers that are not required to send an information circular in accordance with NI 51-102 and Form 51-102F5 (an Information Circular) to any of their securityholders to disclose in their AIF, in addition to other disclosure, the information required under Item 8 of Form 51-102F5, being the executive compensation disclosure required by Form 51-102F6 (the CD&A Disclosure).
11. As Nutrien owns, indirectly, all of the issued and outstanding Agrium Shares, the Filer will not be required to prepare and send an Information Circular. Accordingly, absent the Exemption Sought, pursuant to Item 18.1 of Form 51-102F2, the Filer is required to include the CD&A Disclosure in its 2017 AIF.
12. Subsection 11.6(1) of NI 51-102 requires reporting issuers that are not required to send to their security holders an Information Circular that includes the disclosure required under Item 8 of Form 51-102F5, being the executive compensation disclosure required by Form 51-102F6, and that do not file an AIF that includes the executive compensation disclosure required by Item 18 of Form 51-102F2 to disclose and file a document that contains the information in paragraphs (a) and (b) of subsection 11.6(1) of NI 51-102 for the periods set out in, and in accordance with, Form 51-102F6.
13. The Filer expects that Nutrien will hold the next meeting of shareholders of Nutrien (Nutrien Meeting) prior to September 30, 2018 and that Nutrien will, in connection therewith, prepare and send to the shareholders of Nutrien an Information Circular (the Nutrien Circular), which will include, in addition to other disclosure, the following disclosure in respect of the CD&A Disclosure for Nutrien (the Nutrien CD&A Disclosure):
(a) disclosure required under Items 2.1, 2.2, 2.3 and 2.4 of Form 51-102F6 regarding Nutrien's compensation discussion and analysis, its incentive plans and its compensation governance;
(b) disclosure required under Items 3, 4, 5 and 6 of Form 51-102F6 in respect of Nutrien's five NEOs (as defined in Form 51-102F6) who will be determined in accordance with Items 1.2 and 1.3(6) based on the compensation awarded to, earned by or paid or payable to such individuals for the year ended December 31, 2017 by the Filer and PotashCorp; and
(c) disclosure required under Item 7 of Form 51-102F6 for each of Nutrien's directors.
Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.
The decision of the Decision Makers under the Legislation is that the Exemption Sought is granted, provided that:
(a) Nutrien includes the Nutrien CD&A Disclosure in the Nutrien Circular in connection with the Nutrien Meeting and the Filer, so long as it is a reporting issuer, files the Nutrien CD&A Disclosure promptly following the filing of the Nutrien Circular;
(b) the Filer includes in its 2017 AIF a notice that the Nutrien Circular will include the Nutrien CD&A Disclosure; and
(c) the Nutrien Meeting is held prior to September 30, 2018.