UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark One)
| x | ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 24, 2015
OR
| ¨ | TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number: 001-14460
| A. | Full title of the plan and the address of the plan, if different from that of the issuer named below: |
Agrium Advanced Technologies 401(k) Savings Plan
3005 Rocky Mountain Avenue
Loveland, CO 80538
| B. | Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: |
Agrium Inc.
13131 Lake Fraser Drive Southeast
Calgary, Alberta
Canada T2J 7E8
AGRIUM ADVANCED TECHNOLOGIES
401(k) SAVINGS PLAN
FINANCIAL STATEMENTS
December 24, 2015 and December 31, 2014
(With Report of Independent Registered Public Accounting Firm Thereon)
AGRIUM ADVANCED TECHNOLOGIES
401(k) SAVINGS PLAN
December 24, 2015 and December 31, 2014
TABLE OF CONTENTS
Report of Independent Registered Public Accounting Firm
Agrium Pension Committee and Plan Administrator
Re: Agrium Advanced Technologies 401(k) Savings Plan
Calgary, Alberta
We have audited the accompanying statements of net assets available for benefits of the Agrium Advanced Technologies 401(k) Savings Plan (the Plan) as of December 24, 2015 and December 31, 2014 (liquidation basis) and the related statement of changes in net assets available for benefits for the period ended December 24, 2015 (liquidation basis). 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 the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Plan was not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, 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 Agrium Advanced Technologies 401(k) Savings Plan as of December 24, 2015 and December 31, 2014 (liquidation basis) and the changes in net assets available for benefits for the period ended December 24, 2015 (liquidation basis) in conformity with the liquidation basis of accounting and accounting principles generally accepted in the United States of America.
As discussed in Note 2 to the financial statements, as of December 24, 2015 and December 31, 2014 and for the period ended December 24, 2015, the Plan adopted the new accounting guidance in Accounting Standards Update 2015-12 “Plan Accounting (Topics 960, 962 and 965) – (Part II): Plan Investment Disclosures” to simplify the investment disclosure requirements.
/s/ Eide Bailly LLP
Greenwood Village, Colorado
June 20, 2016
1
AGRIUM ADVANCED TECHNOLOGIES
401(k) SAVINGS PLAN
Statements of Net Assets Available for Benefits
As of December 24, 2015 and December 31, 2014
(U.S. dollars)
| | | | | | | | |
| | | December 24, 2015 | | | December 31, 2014 | |
| | | Liquidation | | | Liquidation | |
| | | Basis | | | Basis | |
Assets | | | | | | | | |
Investments at fair value (note 5): | | | | | | | | |
Common trust funds | | | — | | | | 8,880,475 | |
Mutual funds | | | — | | | | 4,560,149 | |
Common stock | | | — | | | | 612,574 | |
| | | | | | | | |
Total investments | | | — | | | | 14,053,198 | |
| | | | | | | | |
Receivables: | | | | | | | | |
Notes receivable from participants | | | — | | | | 296,653 | |
| | | | | | | | |
Net assets available for benefits | | | — | | | | 14,349,851 | |
| | | | | | | | |
See accompanying notes to the financial statements.
2
AGRIUM ADVANCED TECHNOLOGIES
401(k) SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits
For the period January 1, 2015 to December 24, 2015
(U.S. dollars)
| | | | |
| | | January 1, 2015 to December 24, 2015 | |
| | | Liquidation | |
| | | Basis | |
Additions | | | | |
Investment income: | | | | |
Net realized and unrealized appreciation in fair value of investments | | | 315,521 | |
Interest and dividends | | | 19,144 | |
| | | | |
| | | 334,665 | |
| | | | |
Interest income on notes receivable from participants | | | 511 | |
| | | | |
Total additions | | | 335,176 | |
| | | | |
Deductions | | | | |
Distributions paid to participants | | | 8,369,918 | |
Affiliated plan transfers and other | | | 6,291,582 | |
Administrative expenses | | | 23,527 | |
| | | | |
Total deductions | | | 14,685,027 | |
| | | | |
Net decrease | | | 14,349,851 | |
| |
Net assets available for benefits: | | | | |
Beginning of year | | | 14,349,851 | |
| | | | |
End of year | | | — | |
| | | | |
See accompanying notes to the financial statements.
3
AGRIUM ADVANCED TECHNOLOGIES
401(k) SAVINGS PLAN
Notes to the Financial Statements
December 24, 2015 and December 31, 2014
(U.S. dollars)
The following description of the Agrium Advanced Technologies 401(k) Savings Plan (the Plan) is provided for general information purposes only. Participants should refer to the Plan document for a more complete description of the Plan’s provisions. The Plan sponsor, Agrium Advanced Technologies (U.S.) Inc. (the Company), is a subsidiary of Agrium Inc. (Agrium).
The Plan is a defined contribution plan established for the benefit of eligible employees of the Company. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
The trustee of the Plan at December 31, 2014 and through December 24, 2015 was T. Rowe Price Trust Company.
After conducting a strategic review of the Agrium Advanced Technologies (“AAT”) business unit, a decision was announced in January 2014 by management of Agrium to transition to two core Strategic Business Units, Wholesale and Retail, and to move the Agriculture business of AAT into the Wholesale business unit. A decision was made concurrently to terminate the Plan and all affected participants in the Plan were made 100 percent vested in all accounts. During 2014, Agrium completed the sale of a portion of the AAT business held for sale and the associated Plan members and respective assets were transferred out of the Plan upon finalization of the sale. Agrium moved the remaining active plan members of AAT into the Retail business unit. All remaining plan assets represented non-active Plan members and the related participant balances were transferred or distributed out of the Plan.
Prior to termination of the Plan, eligible participants under the Plan were automatically enrolled with a two percent contribution unless the participant chose not to join the Plan. Participants could have elected to contribute up to 100 percent of their annual compensation. The Company contributed a fixed two percent of eligible compensation to all eligible employees, regardless of participation. In addition, the Company contributed a matching contribution in the amount of 100 percent of the first four percent of the employee’s voluntary contributions. Individual participant contributions were subject to annual Internal Revenue Code (IRC) limitations. Participants may have also contributed amounts representing distributions from other qualified plans.
| | b) | Participant eligibility and plan entry |
Prior to termination of the Plan, employees of the Company were eligible to participate in the Plan if they were regular, full-time employees, and were not leased employees or employees represented by a collective bargaining unit of the Company’s participating subsidiaries or affiliated companies. Regular full-time employees were enrolled into the Plan as soon as practical after they began working with the Company. Employees who were not otherwise ineligible employees, and who were scheduled to work at least 1,000 hours each calendar year, were also eligible to participate. Such employees were enrolled into the Plan as of the first day of the calendar quarter that coincided with or follows a 12 consecutive month period in which they were credited with at least 1,000 hours of service. The first 12 month period began on the employee’s date of hire. The second and all succeeding 12 month periods were the calendar year.
4
AGRIUM ADVANCED TECHNOLOGIES
401(k) SAVINGS PLAN
Notes to the Financial Statements
December 24, 2015 and December 31, 2014
(U.S. dollars)
| | c) | Vesting and forfeitures |
Participants are immediately vested in their contributions, including earnings thereon. Employer contributions, including earnings thereon, become vested according to the following schedule:
| | |
Years of Service | | Vesting Percentage |
Less than one | | 0% |
One year | | 100% |
Terminated participants forfeit non-vested amounts. The balance in the forfeitures account at December 24, 2015 and December 31, 2014 was insignificant. Forfeitures are accumulated during the Plan year and may be used to pay administrative expenses or to reduce employer contributions.
Distributions from the Plan may be made to a participant upon death, total disability, retirement, financial hardship or termination of employment. In-service withdrawals are also permitted after a participant attains age 59 1⁄2. Upon termination of employment, a participant whose vested account balance is greater than $1,000 may elect to receive a distribution of his or her account balance, leave the vested account balance in the Plan until a date not to exceed April 1 of the year following the year in which the participant reaches age 70 1⁄2, or request a direct rollover. A participant with a vested account balance that is $1,000 or less will be required to receive his or her account balance in cash as a lump-sum payment. For all distributions, if a lump-sum payment is elected, any portion of a participant’s account that is invested in the Agrium Inc. Common Stock Fund may be distributed as cash or in common shares of Agrium Inc. at the election of the participant.
Participants may withdraw a minimum of $1,000, not to exceed their pretax contributions, to satisfy one of the immediate and heavy financial needs as described in the Plan document.
The designated beneficiary is entitled to a death benefit distribution equal to the participant’s vested account balance.
| | e) | Administrative expenses |
The Plan’s expenses are paid by either the Plan or the Company, as provided by the Plan document. Expenses that are paid directly by the Company are excluded from these financial statements. Certain expenses incurred in connection with the general administration of the Plan that are paid by the Plan are recorded as deductions in the accompanying statement of changes in net asset available for benefits. In addition, certain investment related expenses are included in net appreciation of fair value of investments presented in the accompanying statement of changes in net assets available for benefits.
5
AGRIUM ADVANCED TECHNOLOGIES
401(k) SAVINGS PLAN
Notes to the Financial Statements
December 24, 2015 and December 31, 2014
(U.S. dollars)
| | f) | Notes receivable from participants |
Prior to termination of the Plan, participants may have borrowed from their accounts a minimum of $1,000 up to a maximum equal to the lesser of 50 percent of their account balance or $50,000, reduced by (a) the participant’s highest outstanding loan balance from the Plan during the one-year period ending on the day before the loan is made and (b) the participant’s outstanding loan balance from the Plan on the day before the loan is made. Loans must have been repaid within five years unless they were for the purchase of a primary residence. The loans were secured by the balance in the participant’s account and bore interest at the prime rate plus one percent as published quarterly in the Wall Street Journal. Principal and interest was paid ratably through payroll deductions. There were no loans outstanding as of December 24, 2015. A participant may have no more than one outstanding loan at any one time.
Prior to termination of the Plan, each participant account was credited with the participant’s contributions and allocations of (a) the Company’s contributions, (b) Plan earnings and losses, and (c) an allocation of administrative expenses. Allocations were based on participant’s earnings or account balances, as defined in the Plan document. The benefit a participant was entitled to was the benefit that could be provided from the participant’s vested account.
Prior to termination of the Plan, upon enrollment into the Plan, a participant may have directed deferrals and employer contributions in any of the funds offered by the Plan. Participants may have changed their investment options daily.
| 2. | SIGNIFICANT ACCOUNTING POLICIES |
Basis of presentation
In January of 2014, a decision was made to terminate the Plan. As a result, the 2014 and 2015 financial statements are prepared using the liquidation basis of accounting.
| | a) | Recent accounting pronouncements |
The Plan adopted the provisions of Accounting Standards Update (ASU) 2015-12 (Part II), “Plan Accounting (Topics 960, 962 and 965): Plan Investment Disclosures.” This ASU eliminates the disclosure of individual investments that represent 5 percent or more of net assets available for benefits, eliminates the net appreciation or depreciation for investments by general type, and requires that investments be grouped only by general type, eliminating the need to disaggregate the investments by nature, characteristics, and risks. The Plan has adopted this standard as Plan management believes this presentation is more relevant to the users of the financial statements. Accordingly, the accounting change has been retrospectively applied to the prior period presented, as required.
6
AGRIUM ADVANCED TECHNOLOGIES
401(k) SAVINGS PLAN
Notes to the Financial Statements
December 24, 2015 and December 31, 2014
(U.S. dollars)
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 and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of changes in net assets during the reporting period. Actual results could differ from those estimates.
Distributions are recorded when paid. There were no termination distributions requested but not yet paid at December 24, 2015.
| | d) | Valuation of investments and income recognition |
As of December 31, 2014, the Plan’s investments were reported at fair value. Fair value is the price that would be received to sell an asset in an orderly transaction between market participants at the measurement date.
A three level hierarchy is used to disclose assets and liabilities measured at fair value. Assets and liabilities are classified in their entirety based on the lowest level of input significant to the fair value measurement.
The three levels are defined as follows:
Level 1 – Observable inputs based on quoted prices (unadjusted) in active markets for identical assets and liabilities.
Level 2 – Observable inputs based on quoted prices for similar assets and liabilities in active markets, quoted prices for identical assets and liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability, or inputs derived from or corroborated by observable market data by correlation or other means.
Level 3 – Unobservable inputs that reflect an entity’s own assumptions about what inputs a market participant would use in pricing the asset or liability based on the best information available in the circumstances.
The Plan’s investments are categorized as Level 1 and Level 2 as shown in note 5.
The following is a description of the valuation methodologies used for assets measured at fair value. There have been no changes in the methodologies used at December 31, 2014.
Mutual funds: Valued at fair value based on the quoted net asset value (NAV) of shares held by the Plan at year end.
Common trust funds: Valued at fair value based on the NAV of the observable market prices of the underlying assets held by the fund less liabilities.
7
AGRIUM ADVANCED TECHNOLOGIES
401(k) SAVINGS PLAN
Notes to the Financial Statements
December 24, 2015 and December 31, 2014
(U.S. dollars)
Common stock: Valued at the closing price reported on the active market on which the individual securities are traded.
The preceding methods described may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, although the Plan believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine fair value of certain financial instruments could result in a different fair value measurement at the reporting date.
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. Net appreciation includes the Plan’s gains and losses on investments bought and sold as well as held during the year.
| | e) | Notes receivable from participants |
Notes receivable from participants are measured at their unpaid principal balance plus any accrued but unpaid interest. Delinquent notes receivables are reclassified as distributions based upon the terms of the Plan document. No allowance for credit losses has been recorded as of December 24, 2015 and December 31, 2014.
The Plan uses a prototype plan document sponsored by AccuDraft.com, Inc. AccuDraft.com, Inc. received an opinion letter from the Internal Revenue Service (IRS), dated March 31, 2008, which states that the prototype document satisfies the applicable provisions of the IRC. The Plan itself has not received a determination letter from the IRS and the Plan has been amended since the opinion letter was issued. However, the Plan sponsor believes the Plan has maintained its tax-exempt status. Therefore, no provision for income taxes has been included in the Plan’s financial statements.
The Plan administrator has analyzed the tax positions taken by the Plan, and has concluded that as of December 24, 2015, there are no uncertain positions taken or expected to be taken that would require recognition of a liability (or asset) or disclosure in the financial statements. The Plan is subject to routine audits by taxing jurisdictions. However, there are currently no audits for any tax periods in progress.
In January of 2014, a decision was made to terminate the Plan. As of that date, all affected participant balances were made 100 percent vested in all accounts. Agrium subsequently discontinued contributions into the Plan and moved any remaining active plan members of AAT into the Retail business unit. All remaining plan assets represented non-active Plan members and the related participant balances were transferred or distributed out of the Plan.
8
AGRIUM ADVANCED TECHNOLOGIES
401(k) SAVINGS PLAN
Notes to the Financial Statements
December 24, 2015 and December 31, 2014
(U.S. dollars)
| | a) | Fair value of plan investments by hierarchy level |
| | | | | | | | | | | | |
| | | Assets at Fair Value as of December 31, 2014 | |
| | | Level 1 | | | Level 2 | | | Total | |
Mutual funds | | | 4,560,149 | | | | — | | | | 4,560,149 | |
Common trust funds (i) | | | — | | | | 8,880,475 | | | | 8,880,475 | |
Common stock | | | 612,574 | | | | — | | | | 612,574 | |
| | | | | | | | | | | | |
Total assets at fair value | | | 5,172,723 | | | | 8,880,475 | | | | 14,053,198 | |
| | | | | | | | | | | | |
| | (i) | Common trust funds share the common goal of growth and preservation of principal. The common trust funds indirectly invest in a mix of U.S. and international common stocks, and fixed income securities through holdings in various mutual funds. There are currently no redemption restrictions or unfunded commitments on these investments. |
| | b) | Changes in fair value levels |
The availability of observable market data is monitored to assess the appropriate classification of financial instruments within the fair value hierarchy. Changes in economic conditions or model-based valuation techniques may require transfer of financial instruments from one fair value level to another. In such instances, the transfer is reported at the beginning of the reporting period.
Plan management evaluated the significance of transfers between levels based upon the nature of the financial instrument and size of the transfer relative to total net assets available for plan benefits. For the period January 1, 2015 to December 24, 2015, there were no significant transfers in or out of levels 1, 2, or 3.
The classification of investment earnings reported in the statement of changes in net assets may differ from the classification of earnings on Form 5500 due to different reporting requirements on Form 5500.
| 6. | RELATED PARTY AND PARTY-IN-INTEREST TRANSACTIONS |
Certain Plan investments are shares of mutual funds and common trust funds managed by the Trustee, as well as common stock of Agrium Inc. Related transactions qualify as exempt party-in-interest transactions. These investments are disclosed in the supplemental schedule of assets held. Fees paid by the Plan for investment management services were included as a reduction of the return earned on each fund. Included in the statement of changes in net assets available for benefits are fees paid by the Plan for loan, recordkeeping and administrative expenses.
| 7. | RISKS AND UNCERTAINTIES |
The Plan invests in various investment securities. Investments in general are exposed to various risks such as significant world events, interest rate, credit and overall market volatility risk. Due to the level of risk associated with certain investments, it is reasonably possible that changes in
9
AGRIUM ADVANCED TECHNOLOGIES
401(k) SAVINGS PLAN
Notes to the Financial Statements
December 24, 2015 and December 31, 2014
(U.S. dollars)
the value of investments will occur in the near term and that such changes could materially affect the amounts reported in the statements of net assets available for benefits.
The Plan’s management has evaluated subsequent events through June 20, 2016, the date the financial statements were available to be issued, to ensure that the financial statements include appropriate disclosure or recognition of events that occurred subsequent to December 24, 2015.
10
SIGNATURE
THE PLAN. Pursuant to the requirements of the Securities Exchange Act of 1934, Agrium Advanced Technologies (U.S.) Inc. has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.
| | | | | | |
| Dated: June 24, 2016 | | | | AGRIUM ADVANCED TECHNOLOGIES 401(K) SAVINGS PLAN |
| | | |
| | | | By: | | AGRIUM ADVANCED TECHNOLOGIES (U.S.) INC. |
| | | |
| | | | | | /S/ Angela S. Lekatsas |
| | | | | | Angela S. Lekatsas |
| | | | | | President |
EXHIBIT INDEX
Exhibit 23.1 Consent of Eide Bailly LLP
