<PAGE>   1

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                    U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                      ------------------------------------
                                   FORM 10-K

                 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000
                         COMMISSION FILE NUMBER 1-10351

                      ------------------------------------

                    POTASH CORPORATION OF SASKATCHEWAN INC.
           (Exact name of the registrant as specified in its charter)

<TABLE>
<S>                                            <C>
                 SASKATCHEWAN                                       N/A
       (State or other jurisdiction of                        (I.R.S. employer
        incorporation or organization)                      identification no.)
</TABLE>

                             122 - 1ST AVENUE SOUTH
                    SASKATOON, SASKATCHEWAN, CANADA S7K 7G3
                                  306-933-8500
 (Address and telephone number of the registrant's principal executive offices)

          SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

<TABLE>
<CAPTION>
             TITLE OF EACH CLASS                    NAME OF EXCHANGE ON WHICH REGISTERED
             -------------------                    ------------------------------------
<S>                                            <C>
         Common Shares, No Par Value                      New York Stock Exchange
(Including rights under the Shareholder Rights
                  Agreement)
</TABLE>

        SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: NONE

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes [X]  No

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.  [X]

     At March 15, 2001, the registrant had 51,862,749 Common Shares outstanding,
and the aggregate market value of the 51,792,742 Common Shares held by
non-affiliates of the registrant was approximately $3,262,942,801.

                      DOCUMENTS INCORPORATED BY REFERENCE

     Portions of the registrant's Annual Report to Shareholders for the fiscal
year ended December 31, 2000 (the "2000 Annual Report"), filed as Exhibit 13,
are incorporated by reference into Part II.

     Portions of the registrant's Proxy Circular for its Annual and Special
Meeting of Shareholders to be held on May 10, 2001 (the "2001 Proxy Circular"),
attached as Exhibit 99, are incorporated by reference into Part III.
--------------------------------------------------------------------------------
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<PAGE>   2

                                     PART I

ITEMS 1 AND 2.  BUSINESS AND PROPERTIES.

GENERAL

     Potash Corporation of Saskatchewan Inc. ("PCS") and its direct and indirect
subsidiaries (together with PCS' predecessors, the "Company") is one of the
world's largest integrated fertilizer and related industrial and feed products
companies. In 2000, the Company's potash production represented an estimated 17%
of global potash production. In addition, it had 23% of global potash capacity
and an estimated 52% of global excess potash capacity, giving it more available
potash capacity than any single company or country other than Canada. The
Company is the third largest producer of phosphates worldwide by capacity,
currently representing approximately 7% of world phosphoric acid production and
6% of world phosphoric acid capacity. The Company is the second largest nitrogen
producer in the Western Hemisphere.

     PCS is incorporated under the laws of the Province of Saskatchewan and is
the successor to a corporation without share capital established by the Province
of Saskatchewan in 1975. Between 1976 and 1990, the Company acquired substantial
interests in the Saskatchewan potash industry. It purchased the Cory mine in
1976, the Rocanville and Lanigan mines in 1977, and, by 1990, 100% of the Allan
mine when the Company acquired all of the outstanding shares of Saskterra
Fertilizers Ltd. In addition, in 1978 the Company acquired reserves at
Esterhazy, which are mined by a third party.

     In November 1989, the Company was privatized by the Province of
Saskatchewan. While the Province initially retained an ownership interest in the
Company, this interest had been reduced to zero by the end of 1993. In October
1993, the Company acquired from Rio Algom Limited ("Rio") its New Brunswick
potash mine and port facilities and its Patience Lake mine in Saskatchewan (the
"Rio Acquisition").

     In April 1995, the Company purchased all of the outstanding shares of
Texasgulf Inc. ("Texasgulf") from Elf Aquitaine, Inc. ("Elf (USA)") and Williams
Acquisition Holding Company, Inc. ("Williams"). At the time of the acquisition,
the name "Texasgulf Inc." was changed to PCS Phosphate Company, Inc. ("PCS
Phosphate"). PCS Phosphate manufactures and sells solid and liquid phosphate
fertilizers, animal feed supplements, and purified phosphoric acid which is used
in food products and industrial processes. Its facility in Aurora, North
Carolina is the largest vertically-integrated phosphate mine and processing
plant in the world. Other assets of PCS Phosphate include: animal feed plants in
three states; two industrial phosphoric acid plants owned through a partnership
carrying on business as PCS Purified Phosphates (formerly Albright & Wilson
Company); an undivided 50% interest in an ammonia storage terminal in Savannah,
Georgia; and PCS Phosphate's product distribution infrastructure.

     In October 1995, the Company purchased all of the outstanding shares of
White Springs Agricultural Chemicals, Inc. ("White Springs") from Occidental
Chemical Corporation ("OxyChem"). White Springs' primary assets are a phosphate
mine and two chemical plant complexes in northern Florida, Swift Creek and
Suwannee River. Other assets of White Springs include two feed plants at the
Suwannee River facility and the remaining undivided 50% interest in the ammonia
storage terminal in Savannah, Georgia owned with PCS Phosphate.

     In March 1997, the Company through its subsidiary PCS Nitrogen, Inc. ("PCS
Nitrogen") acquired all of the outstanding shares of Arcadian Corporation
("Arcadian"). PCS Nitrogen produces nitrogen fertilizers and nitrogen chemicals
at facilities in Georgia, Louisiana, Ohio and Tennessee in the United States,
and has large scale operations in Trinidad. Other assets of PCS Nitrogen include
a 50% interest in a joint venture that owns and operates an ammonia storage
terminal near Houston, Texas and a 50% joint venture interest in a carbon
dioxide processing operation at PCS Nitrogen's plant in Augusta, Georgia.

     In December 1998, the Company purchased, pursuant to a public offering by
the State of Israel, 108,359,925 Ordinary Shares of Israel Chemicals Ltd.
("ICL") for approximately $92 million. This purchase represented 9.03% of the
issued and outstanding Ordinary Shares of ICL. Through its subsidiaries, ICL is
a potash, phosphate and bromine producer and is also involved in other specialty
chemical products.

                                       I-1
<PAGE>   3

     In July 1999, the Company purchased all of the outstanding shares of Minera
Yolanda SCM, a Chilean sodium nitrate and potassium nitrate producer for
approximately $37 million. At the time of the acquisition, the name was changed
to PCS Yumbes SCM ("PCS Yumbes").

     In February 2000, the Company sold its shares in Moab Salt, Inc. to
Intrepid Oil & Gas, LLC. The primary asset of Moab Salt, Inc. is a solution
potash and salt mine in Moab, Utah.

     On March 1, 2000, the Company completed the purchase of an animal feed
plant in Brazil from Mitsui Company. The plant is capable of producing 70,000
tonnes per annum of animal-feed phosphate.

     On March 23, 2000, the Company completed a transaction with Rhodia Inc. to
acquire the remaining 50% ownership interest in the merchant grade phosphoric
acid joint venture company formerly called Albright & Wilson Company for
approximately $42 million. Upon closing of the transaction, the partnership was
renamed PCS Purified Phosphates. The Company and Albright & Wilson Americas Inc.
had been operating the business as a 50/50 partnership. With the completion of
the transaction, the Company now owns 100% of the purified acid plant and
blending plant in Aurora, North Carolina and 100% of the blending plant in
Cincinnati, Ohio. Rhodia Inc. retained a polyphosphoric acid production unit in
Charleston, South Carolina.

     PCS has its head office at Suite 500, 122 - 1st Avenue South, Saskatoon,
Saskatchewan, Canada S7K 7G3.

     The Company has three principal business segments: potash, phosphate and
nitrogen. For information with respect to the net sales revenue, operating
income and assets attributable to each segment and to the Company's domestic and
international sales, see Note 18 to the Company's audited consolidated financial
statements as at December 31, 2000 and 1999 and for each of the three years
ended December 31, 2000 (together with the Notes thereto, the "Consolidated
Financial Statements"), incorporated by reference under Item 8.

     The Company presents its financial statements in accordance with accounting
principles generally accepted in Canada ("Canadian GAAP"). See Note 31 to the
Consolidated Financial Statements for a discussion of certain significant
differences between Canadian GAAP and accounting principles generally accepted
in the United States as they relate to the Company.

     Unless otherwise specified, dollar amounts are stated in U.S. dollars.

     Except for the historical statements and discussions contained herein,
statements contained in this report on Form 10-K constitute "forward looking
statements" within the meaning of Section 27A of the U.S. Securities Act of 1933
and Section 21E of the U.S. Securities Exchange Act of 1934. Forward looking
statements may include words such as "expect", "estimate", "project",
"anticipate", "should", "intend" and similar expressions or variations on such
expressions. Any filing of the Company with the U.S. Securities and Exchange
Commission may include forward looking statements. In addition, other written or
oral statements which constitute forward looking statements have been made and
may in the future be made by or on behalf of the Company, including statements
concerning future operating and financial performance, the Company's share of
new and existing markets, general industry trends and the Company's performance
relative thereto and the Company's expectations as to requirements for capital
expenditures and environmental matters.

     These forward looking statements rely on a number of assumptions concerning
future events and are subject to a number of uncertainties and other factors,
many of which are outside the Company's control, that could cause actual results
to differ materially from such statements. These factors include, but are not
limited to, fluctuations in supply and demand in fertilizer, sulfur and
petrochemical markets, changes in competitive pressures, including pricing
pressures, potential higher actual costs incurred in connection with
restructuring charges as compared to costs estimated for the purposes of
calculating such charges, uncertainty and variations in future undiscounted net
cash flows from use together with residual values estimated for purposes of
calculating restructuring charges, risks associated with natural gas and other
hedging activities, changes in capital markets, changes in currency and exchange
rates, unexpected geological and environmental conditions, imprecision in
reserve estimates, the outcome of legal proceedings and changes in government
policy and regulation, including environmental regulation.

                                       I-2
<PAGE>   4

     The Company disclaims any obligation to update or revise any forward
looking statements, whether as a result of new information, future events or
otherwise.

POTASH OPERATIONS

     The Company's potash operations include the mining and production of
potash, which is predominantly used as fertilizer.

PROPERTIES

     The Company controls the right to mine 615,400 acres of land in
Saskatchewan. Included in these holdings are mineral rights to 507,000 acres
contained in blocks around the six mines in which the Company has an interest,
of which acres approximately 36% are owned by the Company, approximately 50% are
under lease from the Province of Saskatchewan and approximately 14% are leased
from other parties. The majority of the leases are for 21-year terms, renewable
at the Company's option. The Company's remaining 108,400 acres are located
elsewhere in Saskatchewan.

     Potash is mined by the Company from two main potash bearing formations in
Saskatchewan: the Patience Lake member of the prairie evaporites in the north
and the Esterhazy member of the prairie evaporites in the south. The Patience
Lake member is mined at the Lanigan, Allan, Patience Lake and Cory mines, and
the Esterhazy member is mined at the Rocanville and Esterhazy mines.

     Under a long-term mining and processing agreement (the "Mining and
Processing Agreement") effective through 2026, IMC Esterhazy Canada Limited
Partnership ("IMC") mines and processes PCS reserves at the Esterhazy mine. PCS
has the option to terminate this agreement every five years. In order to
terminate the agreement as of December 31, 2001, PCS would have to provide
notice by June 30, 2001. IMC has the option of abandoning the mine at any time
after 2011, thus terminating the Mining and Processing Agreement. In each year
the maximum finished product the Company is permitted to take under the Mining
and Processing Agreement is 952,500 tonnes and the minimum required amount is
453,600 tonnes. For the year ending December 31, 2001, the Company has notified
IMC that it requires 816,466 tonnes of finished product. Water inflow at the
Esterhazy mine has continued, to a greater or lesser degree, since December
1985. Substantial pumping capacity has been installed and remedial efforts have
been undertaken. The Company shares, on an annual basis, in such water inflow
remediation costs.

     Potash is also produced by the Company at its New Brunswick mine from the
flank of an elongated salt structure. Granular product is also produced by the
Company at its Cassidy Lake, New Brunswick facility ("Cassidy Lake Facility")
using standard grade product from certain of the Company's other mine sites. The
Company also holds an interest in certain oil and gas rights within the vicinity
of the New Brunswick mine. Natural gas has been discovered and the Company, in
conjunction with Corridor Resources Inc., is continuing investigations with a
view to determining the extent, nature and commercial viability of the gas
discovery.

     PCS Yumbes, acquired in 1999, holds mining concessions on certain sodium
nitrate reserves in the Atacama desert in northern Chile. The production
facility is in the development stage and has been designed to produce 0.285
million tonnes of potassium nitrate, 0.060 million tonnes of sodium nitrate and
360 tonnes of iodine per year at full production. Preliminary production began
in mid-2000. Development continues with a view to bringing the plant to its full
productive capacity. Sodium nitrate is combined with potassium chloride to
produce potassium nitrate, primarily used for intensely cultivated and
chloride-sensitive crops.

PRODUCTION

     The Company produces potash using both conventional and solution mining
methods. In conventional operations, shafts are sunk to the ore body and mining
machines cut out the ore, which is lifted to the surface for processing. In
solution mining, the potash is dissolved in a warm brine and pumped to the
surface for processing. Approximately 20 grades of potash are produced to suit
preferences of the various markets. Commencing in 2000, a prill product is being
produced at the Company's Cory mine.

                                       I-3
<PAGE>   5

     In 2000, the Company's conventional potash operations mined 19.3 million
tonnes of ore at an average grade of 23.1% K(2)O. In 2000, the Company's potash
produced consisted of 7.15 million tonnes of potash (KCl) with an average grade
of 60.94% K(2)O, representing approximately 44% of North American production.

     The Company's present annual potash production capacity is approximately
12.1 million tonnes KCl, which includes maximum annual production under the
Mining and Processing Agreement with IMC of approximately one million tonnes at
Esterhazy. In 2000, the Company's production capacity represented approximately
55% of the North American total while its excess capacity was an estimated 85%
of North American excess production capacity. The Company allocates production
among its mines on the basis of various factors, including the grades of product
which can be produced and cost efficiency. The Patience Lake mine, which was
originally a conventional underground mine, now employs a solution mining
method, while the other Saskatchewan mines which the Company owns or in which it
has an interest employ conventional underground mining methods.

     The New Brunswick mine is a conventional cut and fill mine. In addition to
potash production, this mine also produced .58 million tonnes of sodium chloride
(salt) in 2000. The Company continues to incur costs at the New Brunswick
division in relation to locating and managing a saturated brine inflow.

     As part of the Rio Acquisition, the Company granted a royalty interest to
Rio based upon production and revenue from the New Brunswick and Patience Lake
potash mines and mills (the "Royalty"). The terms of the Royalty provide that if
production meets specified base production levels or the sales of potash are at
prices which meet specified base sales prices, a royalty per tonne is to be
paid, calculated on a formula basis. Payments under the Royalty are limited to a
term expiring October 7, 2003 and to a maximum aggregate payment of Cdn$50
million. No payments have been made in respect of the Royalty to date.

RESERVES

     The Company estimates that its conventional mines in Saskatchewan contained
4.74 billion tonnes of recoverable ore at an average grade of 22.9% K(2)O as at
December 31, 2000, and that such ore will yield 1.5 billion tonnes of finished
product (KCl) at an average grade of 60% K(2)O.

     The Company's ore reserve estimates for its conventional mining operations
in Saskatchewan are based on exploration drill hole data, seismic data and
actual mining results during the past 25 years. The Company's estimated
recoverable ore and the estimated volumes of finished product from such ore are
as follows:

<TABLE>
<CAPTION>
                                                  RECOVERABLE    FINISHED
MINE                                                  ORE        PRODUCT
----                                              -----------    --------
                                                   (MILLIONS OF TONNES)
<S>                                               <C>            <C>
Allan...........................................    1,387.9        508.8
Cory............................................    1,047.7        323.5
Esterhazy.......................................       74.7         24.7
Lanigan.........................................    1,548.6        445.1
Rocanville......................................      676.8        223.7
                                                    -------      -------
  Total.........................................    4,735.7      1,525.8
                                                    =======      =======
</TABLE>

     The Company believes that, with production rates at full capacity and
utilizing current technology, each of the Allan, Cory and Lanigan mines has a
reserve life in excess of 100 years, the Rocanville mine has a reserve life in
excess of 90 years, and that the Esterhazy mine has a reserve life of at least
20 years.

     Given the characteristics of the solution mining method employed at the
Patience Lake mine, it is not possible to estimate definitively the productive
capacity of or the recoverable ore from this operation. However, based on
information obtained upon the acquisition of the mine, current technology and
the present mining area for this operation, the Company believes that the mine
has a reserve life of at least 40 years for the existing mine workings.
Different techniques will have to be utilized to mine reserves outside of the
existing mine workings.

                                       I-4
<PAGE>   6

     Based on geophysics, exploration drill hole data, definition drilling
underground and actual mining results, the Company estimates proven reserves of
45.6 million tonnes of recoverable ore and 15.8 million tonnes of estimated
finished product (KCl) at its New Brunswick mine. The Company believes that,
based upon its proven reserves, the New Brunswick mine has a reserve life of at
least 20 years with production at full capacity. The Company estimates that
probable reserves at the New Brunswick mine consist of 200 million tonnes of
recoverable ore and 69 million tonnes of estimated finished product (KCl). The
Company believes that, based upon its proven and probable reserves, the New
Brunswick mine has a reserve life in excess of 100 years at full production
capacity and utilizing current technology.

PHOSPHATE OPERATIONS

     The Company mines phosphate ore and manufactures solid and liquid
fertilizers, animal feed supplements and purified phosphoric acid which is used
in food products and industrial processes.

PROPERTIES

     The Company conducts its phosphate operations primarily at two facilities,
one a 35,000-acre facility near Aurora, North Carolina (the "Aurora Facility")
and the other a 96,000-acre facility near White Springs in northern Florida (the
"White Springs Facility"). The Company believes the Aurora Facility to be the
largest integrated phosphate mine and phosphate processing complex at one site
in the world. The Aurora Facility, having an annual P(2)O(5) capacity of 1.2
million tonnes, includes a six million tonne per-year mining operation, four
sulfuric acid plants, four phosphoric acid plants, a liquid fertilizer (11-37-0)
plant, a superphosphoric acid plant, two diammonium phosphate ("DAP") plants and
a solid fertilizer plant capable of producing DAP, granular triple
superphosphate ("GTSP") or monoammonium phosphate ("MAP"). The Company also
holds all outstanding interests in PCS Purified Phosphates (formerly Albright &
Wilson Company) which produces high purity phosphoric acid at Aurora. The White
Springs Facility is the third largest P(2)O(5) producer, by capacity, in the
United States, with an annual capacity of 1.1 million tonnes. The White Springs
Facility includes a mine and two production facilities, Suwannee River and Swift
Creek, with two sulfuric acid plants, three phosphoric acid plants, two DAP
plants, a superphosphoric acid plant, a dicalcium phosphate plant and a
defluorinated phosphate rock plant located at the Suwannee River complex and two
sulfuric acid plants and a phosphoric acid plant and superphosphoric plant
located at the Swift Creek complex. The Company's other properties include
animal feed plants in Kinston, North Carolina; Marseilles, Illinois; Weeping
Water, Nebraska and Sao Vincente, Brazil; a purified phosphate blending plant in
Cincinnati, Ohio and terminal facilities at Morehead City, North Carolina and
Savannah, Georgia.

     In the first quarter of 2001, the Company announced the permanent closure
of its Davenport, Iowa feed plant. Davenport has an annual capacity of 280,000
tonnes of Monocal and Dical feed supplements. The Company also announced in the
first quarter of 2001 that it suspended all DAP production at the White Springs
facility for an extended period. Combined with previous cutbacks, the total
idled DAP production at the White Springs facility is 710,000 tonnes on an
annualized basis. During the curtailment, the site will produce P(2)O(5) only to
serve its feed business, utilizing approximately 50% of its P(2)O(5) capacity.

     At its Geismar, Louisiana facility (the "Geismar Facility"), acquired as
part of the Arcadian acquisition, the Company manufactures a variety of
phosphate products that are used for agricultural and industrial purposes. The
Geismar Facility has a sulfuric acid plant, a phosphoric acid plant, a
superphosphoric acid plant, and a liquid fertilizer (11-37-0) plant. A
significant portion of the phosphoric acid produced at the Geismar Facility is
sold as feedstock to Rhodia, Inc. for use in its neighboring purified acid
plant.

PRODUCTION

     The Company extracts phosphate ore using surface mining techniques. At each
mine site, the ore is mixed with recycled water to form a slurry, which is
pumped from the mine site to the Company's processing facilities. The ore is
then screened to remove coarse materials, washed to remove clay and floated to
remove sand to produce phosphate "rock". The annual production capacity of the
Company's mines is currently 9.6 million tonnes of phosphate rock. During 2000,
the Aurora Facility's total production of phosphate rock

                                       I-5
<PAGE>   7

was 4.7 million tonnes and the White Springs Facility's total production of
phosphate rock was 2.9 million tonnes. The Company generally operates its
phosphate mine and phosphate processing plants 24 hours a day, seven days a
week, using rotating shifts. The sequence for mining portions of the Aurora
property has been identified in the permit issued by the U.S. Army Corps of
Engineers in 1997. The Company has been mining in an area of non-optimal mining
conditions. The quality and condition of the ore is relatively inferior to ore
previously mined at the Aurora Facility. This, combined with the general
configuration of the area, does not allow efficient use of the Company's mining
equipment and technology. In 2001, the Company expects part of the mining
operation to enter areas believed to hold ore superior in thickness and quality,
located closer to the Company's chemical plants, and configured so as to
generally allow efficient use of Company mining equipment and technology.

     Phosphate rock is the major input in the Company's phosphorus processing
operations. In addition to phosphate ore, the principal raw materials required
by the Company are sulfur, sulfuric acid and ammonia. The production of
phosphoric acid requires substantial quantities of sulfur, which the Company
purchases from third parties. In December 1997, the Company entered into a
ten-year supply contract with an offshore supplier to supply a portion of the
Company's sulfur requirements and also committed to build a multipurpose
ocean-going vessel to ship such sulfur as well as handle sulfuric acid,
phosphoric acid and other chemicals. The vessel was delivered in February 2000
and has been put into service. The Company produces sulfuric acid at the Aurora
Facility, White Springs Facility and Geismar Facility and purchases additional
sulfuric acid from unaffiliated sellers. The Company also transports surplus
production of sulfuric acid at the White Springs Facility to the Aurora Facility
as needed.

     The Company purchases all of its ammonia from or through PCS Nitrogen and
PCS Sales (USA), Inc., which are wholly owned subsidiaries of the Company. The
Company reacts phosphoric acid with ammonia to produce DAP as well as liquid
fertilizers. In addition, ammonia operations include the purchase, sale and
terminalling of anhydrous ammonia. Most of the ammonia that is currently
purchased by PCS Nitrogen is produced in Russia and imported through a Company
operated ammonia terminal located within the port of Savannah (Garden City,
Georgia).

     Substantially all of the phosphate rock produced by the Company is used
internally for the production of phosphoric acid, superphosphoric acid ("SPA"),
chemical fertilizers, purified phosphoric acid and animal feed products.

     A portion of the Company's phosphoric acid production, merchant grade
phosphoric acid ("MGA"), is sold in liquid form, mostly to foreign and domestic
producers of solid fertilizers. The solid fertilizer produced by the Company is
DAP. In 2000, over one-half of the Company's DAP was exported, with the balance
sold domestically, mostly to large regional dealers that custom blend solid
fertilizers.

     The Company produces a number of liquid fertilizer products, 74% of which
were sold domestically in 2000. The Company believes that it is the largest U.S.
producer of SPA.

     The Company also processes phosphoric acid to produce animal feed
supplements for the poultry and livestock markets. PCS Purified Phosphates
produces purified phosphoric acid for use in a wide variety of food and
industrial applications.

     In addition to nitrogen products, the Company also produces phosphate
products at the Geismar plant for which supplies of phosphate rock and sulfur
are necessary. PCS Nitrogen purchases phosphate rock from Morocco pursuant to an
agreement with a Moroccan government-owned company, the current term of which
expires on December 31, 2002, wherein prices are reset annually through
negotiation. If no agreement on price is reached, either party may terminate the
agreement. Changes in the agreement could affect the stability of the supply of
the raw material and the profitability of these phosphate products.

RESERVES

     At December 31, 2000, the Company's Aurora phosphate mine had estimated
proven and probable reserves of approximately 378 million tonnes of phosphate
rock, at an average grade of 30.7% P(2)O(5). These reserves would permit mining
to continue at current rates for about 75 years. The Aurora phosphate mine has

                                       I-6
<PAGE>   8

an estimated annual capacity of 6.0 million tonnes of phosphate rock and its
processing plants have the capacity to produce 1.202 million P(2)O(5) tonnes of
phosphoric acid. Prior to the acquisition of Texasgulf by the Company in April
1995, approximately 408 million tonnes of phosphate reserves were transferred by
Texasgulf to a newly established company, the common stock of which was
transferred to Elf (USA) and Williams. The Company was granted a 20-year right
of first refusal (from April 10, 1995) in the event that the newly established
company proposes to sell the reserves. In addition, the newly established
company and Elf (USA) and Williams agreed, for a period of ten years from April
10, 1995, not to compete, and for the first five years not to make certain
preparations to compete, with the Company with respect to those reserves.

     The White Springs phosphate mine had estimated proven and probable reserves
of approximately 53 million tonnes of phosphate rock, at an average grade of
30.7% P(2)O(5). The Company estimates that an additional 9 million tonnes of
phosphate rock could be purchased at market rates from nearby owners.
Accordingly, the total reserves of 60 million tonnes of phosphate rock at White
Springs would sustain the mine for 17 years at a mining rate of 3.6 million
tonnes per year. The White Springs mine has an estimated annual capacity of 3.6
million tonnes of phosphate rock and the processing plants have the capacity to
produce annually 1.093 million P(2)O(5) tonnes of phosphoric acid.

NITROGEN OPERATIONS

     The Company's nitrogen operations include production of nitrogen
fertilizers and nitrogen chemicals. These products are used for both
agricultural and industrial purposes.

PROPERTIES

     PCS Nitrogen manufactures nitrogen products at five facilities, of which
four are located in the United States and one is located in Trinidad. The
following table sets forth the facility locations and production capabilities:

<TABLE>
<CAPTION>
PLANT LOCATIONS                                              PRODUCTS PRODUCED
---------------                                 --------------------------------------------
<S>                                             <C>
Augusta, Georgia............................    Ammonia, urea, nitric acid, ammonium nitrate
                                                and nitrogen solutions
Geismar, Louisiana..........................    Ammonia, nitric acid, nitrogen solutions,
                                                phosphoric acid, super-phosphoric acid,
                                                phosphate solutions, sulfuric acid
Lima, Ohio..................................    Ammonia, urea, nitric acid and nitrogen
                                                solutions
Memphis, Tennessee..........................    Ammonia and urea
Point Lisas, Trinidad.......................    Ammonia and urea
</TABLE>

PRODUCTION

     Unlike potash and phosphate, nitrogen is not mined. It is taken from the
air and reacted with a hydrogen source, usually natural gas reformed with steam,
to produce ammonia. PCS Nitrogen produces ammonia at all domestic plants and in
Trinidad. The ammonia is used to produce a full line of upgraded nitrogen
products, including urea, ammonium nitrate, nitric acid and nitrogen solutions.

SERVICE AGREEMENTS

     The Geismar plant is integrated with a larger chemical manufacturing
complex owned by Honeywell International, Inc. ("Honeywell"). PCS Nitrogen and
Honeywell have an agreement to provide certain support services to each other,
including the provision of utilities, the discharge of wastewater, security,
dock and emergency services, and other essential services.

     BP Chemicals, Inc. ("BPC") operates the Lima plant on PCS Nitrogen's behalf
under an operating agreement that can be terminated by either party with nine
months' notice. PCS Nitrogen's payments to BPC under the operating agreement are
generally based on BPC's previous cost of operating the Lima plant and are made
through the reimbursement of expenses incurred by BPC in providing such
operating services. In

                                       I-7
<PAGE>   9

addition, due to the mutual interdependence of the Lima plant and BPC's
operations, PCS Nitrogen and BPC have agreed to provide each other with certain
manufacturing support services at cost pursuant to a contract extending for as
long as the plants continue to operate and either party is required to provide
support services thereunder.

     At Augusta, PCS Nitrogen uses contract labor personnel provided by Augusta
Services Company, Inc., which is owned 50% by PCS Nitrogen and 50% by DSM
Chemicals North America, Inc., to provide purchasing, stores and spare parts
management, maintenance, repair, shipping and certain other services for the
Augusta plant.

     Despite the Company's belief that most of the services described above are
available from other sources, the termination of or the need to replace certain
of those services (such as steam, well water supply and dock services) could, in
the aggregate, involve potentially significant capital expenditures, increased
operating costs and disruption to the operation of the affected plant.

RAW MATERIALS

     Natural gas is the primary raw material used for the production of ammonia
and, as a result, virtually all of PCS Nitrogen's other nitrogen products. For
2000, the purchase and transportation of natural gas accounted for approximately
55% of PCS Nitrogen's total domestic production cost. PCS Nitrogen's domestic
gas requirements comprise approximately 50% of its total gas requirements. PCS
Nitrogen's current natural gas strategy is to purchase approximately one-half of
its domestic natural gas in the spot market or on short-term contracts and
approximately one-half of its domestic natural gas pursuant to fixed-price
physical contracts or forward contracts which fix the price of future
deliveries. The remaining approximately 50% of its natural gas is purchased in
Trinidad using pricing formulas related to the market price of ammonia. With the
exception of the Trinidad facility, PCS Nitrogen purchases nearly all its
natural gas from producers or marketers at the point of delivery of the natural
gas into the pipeline system, then pays the pipeline company and, where
applicable, the local distribution company to transport the natural gas to PCS
Nitrogen's facilities. Approximately 85% of PCS Nitrogen's domestic consumption
of natural gas is delivered pursuant to firm transportation contracts which do
not permit the pipeline or local distribution company to interrupt service to,
or divert natural gas from, the plant.

PCS JOINT VENTURE

     The Company indirectly holds all outstanding interests in a limited
partnership (the "PCS Joint Venture") doing business in Florida as Florida
Favorite Fertilizer and in Georgia and Alabama as Farmer's Favorite Fertilizer.
Potash Corporation of Saskatchewan (Florida), Inc. is the general partner of PCS
Joint Venture. PCS Joint Venture manufactures, processes and distributes
fertilizer and other agricultural supplies from plants located in Florida,
Alabama and Georgia.

                                       I-8
<PAGE>   10

MARKETING

     The following table summarizes the Company's net sales revenue from potash,
phosphate and nitrogen products (by geographical distribution) in the past three
calendar years:

<TABLE>
<CAPTION>
                                                              2000        1999         1998
                                                            --------    --------    ----------
                                                                  (THOUSANDS OF DOLLARS)
<S>                                                         <C>         <C>         <C>
Potash
  Canada................................................    $ 28,036    $ 21,429    $   21,885
  United States.........................................     209,386     215,993       205,701
  Canpotex..............................................     268,913     254,711       252,464
  Other.................................................      72,324      71,163        65,441
                                                            --------    --------    ----------
  Total.................................................    $578,659    $563,296    $  545,491
                                                            ========    ========    ==========
Phosphates
  Canada................................................    $ 51,447    $ 24,010    $   25,386
  United States.........................................     536,480     594,183       688,198
  PhosChem..............................................     146,288     186,494       262,168
  Other.................................................      48,311      39,153        35,237
                                                            --------    --------    ----------
  Total.................................................    $782,526    $843,840    $1,010,989
                                                            ========    ========    ==========
Nitrogen
  Canada................................................    $  1,423    $  5,284    $    4,422
  United States.........................................     658,741     480,213       585,672
  Other.................................................     210,207     168,431       161,189
                                                            --------    --------    ----------
  Total.................................................    $870,371    $653,928    $  751,283
                                                            ========    ========    ==========
</TABLE>

     The following table summarizes the Company's net sales revenue from potash,
phosphate and nitrogen products, by category of product, in the past three
calendar years:

<TABLE>
<CAPTION>
                                                               2000        1999        1998
                                                             --------    --------    --------
                                                                  (THOUSANDS OF DOLLARS)
<S>                                                          <C>         <C>         <C>
Potash...................................................    $578,659    $563,296    $545,491
Phosphates
  Fertilizer -- Liquids..................................     192,301     215,519     274,139
  Fertilizer -- DAP......................................     222,869     278,370     374,525
  Feed...................................................     215,373     216,821     229,345
  Industrial.............................................     151,983     133,130     132,980
Nitrogen
  Ammonia................................................     353,330     244,719     258,387
  Urea...................................................     236,315     180,545     200,103
  Nitrogen Solutions.....................................     135,660     111,080     163,018
  Other..................................................     145,066     117,584     129,775
</TABLE>

     For further financial information about the Company's business segments and
domestic and international sales, see Note 18 to the Consolidated Financial
Statements.

     The Company has a diversified customer base, and apart from sales to
Canpotex Limited ("Canpotex"), no one customer accounted for more than 10% of
the Company's sales in 2000.

     Potash from the Company's Saskatchewan mines produced for use outside North
America is sold exclusively to Canpotex. PCS Sales (Canada) Inc. executes
offshore marketing and sales for the Company's New Brunswick potash and executes
marketing and sales for the Company's potash, phosphate and nitrogen products in
Canada. PCS Sales (USA), Inc. executes marketing and sales for the Company's
potash, phosphate and nitrogen products in the United States. PCS Sales (USA),
Inc. also generally executes

                                       I-9
<PAGE>   11

international marketing and sales of the Company's potassium and sodium nitrate
products. PhosChem, an association formed under the U.S. Webb-Pomerene Act, is
the principal vehicle through which the Company executes offshore marketing and
sales for its phosphate fertilizers. See "Offshore Marketing".

     Ammonia, urea, ammonium nitrate and nitrogen solutions are sold as
fertilizers to agricultural customers and to industrial customers for various
applications, while nitric acid is sold to industrial customers as an
intermediate chemical feedstock.

     In the past, fertilizer prices have been volatile. No assurance can
therefore be given that the average market prices for the Company's fertilizer
products will continue at current levels.

NORTH AMERICAN MARKETING

     In 2000, North American net sales revenue from potash products represented
11% of the Company's total net sales revenue, substantially all of which was
attributable to potash customers in the United States. Typically, North American
potash sales of the Company are greatest in the first half of the year. The vast
majority of sales are made on the spot market with the balance made under
short-term contracts. The Company has no material contractual obligations in
connection with North American sales to sell potash in the future at a fixed
price.

     In 2000, North American net sales revenue from phosphate products
represented 26% of the Company's total net sales revenue, substantially all of
which was attributable to phosphate customers in the United States. Typically,
North American phosphate product sales are greatest in the first and second
calendar quarters. In 2000, the majority of PCS Phosphate's phosphate product
sales were made on the spot market, with the balance made under short-term
contracts (generally on an annual basis) and a limited number of sales made
pursuant to multi-year contracts. The Company has no material contractual
obligations in connection with North American sales to sell phosphate in the
future at a fixed price.

     In 2000, North American net sales revenue from nitrogen products
represented 36% of the Company's total net sales revenue and PCS Nitrogen's
non-fertilizer products accounted for approximately 47% of PCS Nitrogen's
nitrogen revenue. Typically, North American nitrogen fertilizer sales are
greatest in the second calendar quarter. In 2000, the majority of PCS Nitrogen's
nitrogen product sales were made on the spot market, with the balance made under
short-term and multi-year contracts. The Company has no material contractual
obligations in connection with North American sales to sell nitrogen in the
future at a fixed price.

     Ammonia purchased by PCS Nitrogen is used in the Company's operations and
is sold to third party customers by PCS Sales (USA), Inc.

     The primary customers for fertilizer products are retailers, dealers,
cooperatives, distributors and other fertilizer producers. Such retailers,
dealers and cooperatives have both distribution and application capabilities.
The primary customers for industrial products are chemical product
manufacturers. The majority of the Company's purified phosphoric acid is sold
directly to consumers of the product, with the balance sold through an
authorized non-exclusive distribution network.

     At December 31, 2000, the Company's North American sales functions were
handled by 109 employees in Chicago, Illinois and various other locations in the
United States, and 16 employees in Saskatoon, Saskatchewan.

OFFSHORE MARKETING

     Potash produced by the Company in Saskatchewan for sale outside North
America is sold to Canpotex, which is owned in equal shares by the three potash
producers in the Province of Saskatchewan (including the Company). Canpotex,
which was incorporated in 1970 and commenced operations in 1972, acts as an
export company and as a unified marketing force for all Saskatchewan potash
production in the offshore marketplace. Each shareholder of Canpotex has an
equal voting interest as a shareholder and through its nominees on the board of
directors. The Company and the other shareholders of Canpotex have agreed that,
as long as they are members of Canpotex, and with respect to potash produced in
Canada, they will not make offshore sales

                                       I-10
<PAGE>   12

independently. The Company's production from its New Brunswick mine has been
exempted from this requirement by the members of Canpotex. Any member may
terminate its membership in Canpotex at specified times of the year on six
months' notice.

     In general, Canpotex sales are allocated among the producers based on
production capacity. If a shareholder cannot satisfy demand for potash by
Canpotex, the remaining shareholders are entitled to satisfy the demand pro rata
based on their allotted production capacity. The Company currently supplies
55.65% of Canpotex's requirements. Canpotex sells potash to government agencies
and private firms pursuant to six-month contracts at negotiated prices or by
spot sales.

     The following table sets forth the percentage of sales by Canpotex for the
past three calendar years in the various geographical regions:

<TABLE>
<CAPTION>
                                                              2000    1999    1998
                                                              ----    ----    ----
<S>                                                           <C>     <C>     <C>
Asia........................................................   74%     75%     69%
Latin America...............................................   16      13      17
Oceania.....................................................    6       8       9
Europe......................................................    4       4       5
                                                              ----    ----    ----
Total.......................................................  100%    100%    100%
                                                              ====    ====    ====
</TABLE>

     For 2000, sales to Canpotex represented 12% of the total net sales of the
Company and net sales revenue from offshore sales of potash from the New
Brunswick mine, through PCS Sales (Canada) Inc., represented 3% of the total net
sales of the Company. In January 2001, Canpotex announced the completion of its
marketing joint venture for certain offshore markets (outside North America and
Europe) with JSC Uralkali, a Russian potash producer.

     Since 1975, PhosChem has been the principal vehicle for United States
exports of phosphate fertilizers. Currently, the members of PhosChem are PCS
Phosphate, IMC Phosphates Company ("IMC-Phosphates"), a joint venture between
IMC Global Inc. and Phosphate Resource Partners LLP, Mississippi Phosphates
Corporation ("MissChem") and Mulberry Corporation. The PhosChem members have
agreed to export their fertilizer products exclusively through PhosChem, except
for exports to Canada, any member state of the European Union or the European
Economic Area, and sales through the U.S. Agency for International Development
Tenders and sales to certain buyers affiliated with members. Historically,
PhosChem negotiated prices and other terms for the export sale of fertilizer
products. According to the terms of a PhosChem agreement effective January 1,
1995, IMC-Phosphates is responsible for the marketing of solid fertilizers (DAP,
MAP and GTSP), and PCS Phosphate, or its sales affiliate (PCS Sales (USA),
Inc.), is responsible for the marketing of liquid fertilizer products (MGA) to
export countries. Total sales for 2000 were apportioned as follows: 58% to
IMC-Phosphates, 23% to PCS Phosphate, 11% to MissChem, and 7% to Mulberry
Corporation. As Mulberry Corporation's production was shut down for 2000, the
allocation based on actual P(2)O(5) shipments were IMC 67%, PCS Phosphate 24%
and MissChem 9%. The PhosChem agreement is currently in effect through December
31, 2001, and subject to renewal thereafter. If the PhosChem agreement is not
renewed, the Company does not believe the disbanding of PhosChem would
materially affect the Company's sales of fertilizer, but there can be no
assurance that, if PhosChem were to be disbanded, the Company would be able to
find alternative outlets for its products or sell its products at prices or on
terms similar to those expected to be obtained by PhosChem. The Company's
estimated 2001 PhosChem allocation is 21%.

     Revenue from sales to PhosChem accounted for 7% of the Company's total net
sales in 2000. Other offshore phosphate sales accounted for 2% of the Company's
total net sales in 2000. All of the Company's phosphate sales to China and India
were made through PhosChem. Most of the Company's sales of phosphate products to
China are made to the central purchasing authority of the Chinese government.
Sales in India were made through the Fertilizer Association of India to many
independent buyers.

                                       I-11
<PAGE>   13

     The following table sets forth the percentage of sales of PhosChem for the
past three calendar years in the various geographical regions:

<TABLE>
<CAPTION>
                                                              2000    1999    1998
                                                              ----    ----    ----
<S>                                                           <C>     <C>     <C>
Asia........................................................   74%     81%     77%
Latin America...............................................   13      11      13
Mid East....................................................    1      --       1
Oceania.....................................................   12       8       9
                                                              ----    ----    ----
Total.......................................................  100%    100%    100%
                                                              ====    ====    ====
</TABLE>

     With respect to offshore sales of nitrogen, ammonia and urea sales
predominate and originate primarily from Trinidad, with other sales coming from
purchased product locations. For 2000, net sales revenue from offshore sales of
nitrogen represented 9% of the net sales revenue of the Company.

     Offshore sales are subject to those risks customarily encountered in
foreign operations, including (i) fluctuations in foreign currency exchange
rates, (ii) changes in currency and exchange controls, (iii) the availability of
foreign exchange, (iv) laws, policies and actions affecting foreign trade and
(v) other economic, political and regulatory policies of foreign governments.

DISTRIBUTION AND TRANSPORTATION

     The Company has an extensive infrastructure and distribution system to
transport and store its products. Other than storage facilities located at
production plants, the Company used 169 locations to store and handle its
products in the field in 2000. The Company owns or leases approximately 5,000
railcars.

     Transportation costs add significantly to the total amounts paid by
purchasers of potash. Producers have a definite advantage in markets close to
their sources of supply (e.g., Saskatchewan producers in the Midwestern United
States, New Brunswick producers on the U.S. Eastern Seaboard and New Mexico
producers in the Southern and Western United States). International shipping
cost variances permit offshore producers (including those in the Former Soviet
Union ("FSU"), Germany, Israel and Jordan) to compete effectively in some of the
Company's traditional markets.

     Most of the Company's potash for North American customers is shipped by
rail. Shipments are also made by rail from each of the Company's Saskatchewan
mines to Thunder Bay, Ontario, for shipment by lake vessel to the Company's
warehouses and storage facilities in Canada and the United States.

     Potash from the New Brunswick mine is shipped primarily by ocean-going
vessel from the Port of Saint John, although truck and rail transport are also
used for North American customers.

     In the case of the Company's sales to Canpotex, potash is transported by
rail principally to Vancouver, British Columbia, where port facilities exist for
storage pending shipment overseas. The Company has an equity interest in
Canpotex Bulk Terminals Limited, which is a part owner of these port facilities.
The Company, through Canpotex, also has an interest in a port facility located
in Portland, Oregon.

     With respect to phosphates, the Company has long-term leases on shipping
terminals in Morehead City and Beaufort, North Carolina, through which it
receives and stores raw materials for, as well as the products manufactured by,
the Aurora Facility. The Company owns eight barges (four used for solid
products, two for phosphoric acid and sulfuric acid and two for sulfur) and two
tug boats, which are used to transport materials between the Aurora Facility and
Morehead City, North Carolina. Raw materials and products are also transported
to and from the Aurora Facility by rail. The Company transports sulfur it
purchases from Canada in large, dedicated unit trains. Both CSX Corporation and
Norfolk Southern Corporation serve the Aurora Facility. In December 1997, the
Company entered into a ten-year supply contract with an offshore supplier to
supply a portion of the Company's sulfur requirements and also committed to
build a multipurpose ocean-going vessel to ship such sulfur as well as handle
sulfuric acid, phosphoric acid and other chemicals. The vessel made its maiden
voyage in the first quarter of 2000. The Company receives ammonia for its
phosphate

                                       I-12
<PAGE>   14

operations at Aurora through its ammonia terminal in Savannah, Georgia; the
ammonia is shipped by rail from Savannah to the Aurora Facility.

     Sulfur is delivered to the White Springs Facility by unit trains from
Canada and by rail from multiple domestic sources. The Company receives ammonia
for its phosphate operations at White Springs through its ammonia terminal in
Savannah, Georgia; ammonia is shipped by rail from Savannah to the White Springs
Facility. Until 1999 the Norfolk Southern Corporation was the only railroad
providing service for the White Springs Facility. However, a nearby transload
facility at Lake City, Florida, which became operational in 1999, is serviced by
the CSX Corporation. Most of the phosphoric acid and chemical fertilizers
produced at the White Springs Facility are shipped to domestic destinations by
rail. The Company also ships some of its phosphoric acid, chemical fertilizers
and animal feed products, produced at the White Springs Facility, through the
bulk terminal located in Morehead City, North Carolina, for offshore sales.

     The Company makes domestic deliveries of animal feed products (bulk and
bagged) by rail or truck from its manufacturing facilities and from several
warehouses supplied from its manufacturing facilities.

     The Company distributes its nitrogen products by barge, railcar, truck,
direct pipeline to its customers and through its strategically located storage
terminals in high consumption areas. The Company leases or owns approximately 65
nitrogen terminal facilities with an aggregate storage capacity of approximately
700,000 tons of product. The terminals provide off-season storage and also serve
local dealers during the peak seasonal demand period.

     The Company distributes products from the Trinidad plant to markets in
Latin America and Europe in addition to the United States. The Company's
distribution operations in Trinidad employ two long-term chartered ocean-going
vessels and utilize spot charters as necessary for the transportation of
ammonia. All bulk urea production is shipped through third-party carriers.

COMPETITION

     The markets for potash, both domestic and foreign, are highly competitive.
Since potash is a commodity, producers must compete based on price and service
(e.g., delivery time and ability to supply all grades). Apart from competitive
pricing, the Company's principal method of competition is the quality of service
it provides to customers. Among other things, the Company provides quality
service by maintaining warehouses and leasing railcars to enhance its delivery
capability. The high cost of transporting potash limits competition in various
areas.

     The Company's potash competition includes three North American producers
and potash producers located outside North America in the FSU, Israel, Jordan,
Germany and France. Because of the high capital cost and lead time required to
construct a new mine, the Company's principal competition is expected to
continue to come from the owners of existing operations.

     Many phosphate products, particularly solid fertilizers, are commodities,
with little or no product differentiation, and thus trade on the basis of prices
determined in highly competitive markets. The vast majority of the U.S.
phosphate rock not mined by the Company is produced in central Florida,
southeast of Tampa, and most of the U.S. phosphate processing capacity, other
than at the Aurora Facility, is located in Florida and along the coast of the
Gulf of Mexico.

     The Company's principal advantage at Aurora in competing with other
producers is that it operates integrated phosphate mine and phosphate processing
complexes, while most of its competitors are required to ship phosphate rock by
rail or truck from their mines to their chemical processing plants, thus
incurring substantially higher transportation costs.

     As a result of its location in North Carolina and the relatively high cost
of transportation, the Company's U.S. phosphate sales from Aurora have a natural
advantage in the Northeast, mid-Atlantic and eastern Midwest regions, while
White Springs and other Florida producers have a natural advantage in the South,
and Gulf Coast producers have a natural advantage in areas of the Midwest
accessible to barge traffic up the Mississippi River.

                                       I-13
<PAGE>   15

     The Company also competes with governmental enterprises and independent
phosphate producers in important exporting countries, including Morocco,
Tunisia, Jordan, South Africa and Australia.

     The animal feed supplement business in the phosphate segment is commodity
like, however, opportunity to nutritionally differentiate exists. The Company
has a significant presence in the domestic feed supplement market and increased
world demand for meat proteins has resulted in growth in exports of phosphate
supplements.

     Although there has been extensive consolidation and privatization
worldwide, substantial competition exists in the nitrogen industry. The Company
competes domestically with a broad range of companies in the production and sale
of nitrogen products, including subsidiaries of larger chemical companies, farm
cooperatives, integrated energy companies and independent fertilizer companies.
Because fertilizer is a commodity, competition takes place largely on the basis
of price and delivery. The relative cost of, and availability of transportation
for, raw materials and finished products to manufacturing facilities and markets
are important competitive factors.

     The Company also competes with foreign companies whose nitrogen products
are imported into the U.S. Although diminishing in number, various foreign
competitors receive subsidies from their governments. Some countries also have
natural gas supplies that are surplus to domestic demand. This surplus natural
gas may have a low alternative value and, when used as feedstock for the
manufacture of ammonia and urea, can result in low-cost production. These
low-cost products are being imported into the U.S. and compete with domestically
manufactured nitrogen fertilizers, including the Company's. In addition, other
importers subsidized by their governments may import products into the U.S. for
reasons not related to U.S. fertilizer market conditions, such as a need to
obtain U.S. dollars.

     The Company's nitrogen production capability is currently the second
largest in the Western Hemisphere. The Company's domestic nitrogen plants serve
agricultural markets with a diversified crop base that spans a lengthy growing
season and chemical industrial manufacturers located throughout the U.S. Those
plants are strategically located in agricultural as well as industrial end-use
markets in the Southeast, Midwest and Gulf Coast regions. The Company believes
that it is more economical to transport natural gas, the primary raw material in
the production of nitrogen fertilizers and chemicals, to plants situated in the
product markets than to transport such products over long distances. The Company
concentrates its nitrogen marketing efforts on these nearby markets where lower
transportation costs offer the potential for better margins. The Company
believes that its product mix diversity and the number and geographic diversity
of its nitrogen plants provide competitive advantages in manufacturing,
distribution, marketing, customer service and other areas. In addition, the
industrial demand for nitrogen products is typically less volatile and follows
different demand cycles than agricultural demand for fertilizer. The Company
believes that its industrial sales add a measure of stability to its revenue and
are a desirable complement to agricultural demand.

EMPLOYEES

     At December 31, 2000, the Company actively employed 5,338 persons, of whom
1,882 were salaried and 3,456 were hourly paid. Of these employees, the
Company's potash operations employed 1,738 people, the phosphate operations
2,407, and the nitrogen operations 801. Excluding sales personnel, the Saskatoon
and Northbrook offices had a staff of 188. The Company's sales group employed
204 people.

     The Company has entered into nine collective bargaining agreements with
labor organizations representing employees. The collective bargaining agreements
at the Allan, and Patience Lake divisions expired on April 30, 2000 and
negotiations are continuing. The Lanigan agreement expired on January 31, 2001
and negotiations are continuing. The Company and the Rocanville Potash Employees
Association have a contract that expires on May 31, 2001. The agreement between
IMC and the union representing the employees at the Esterhazy mine expired on
January 31, 2001 and negotiations are continuing. The union agreement at PCS
Cassidy Lake expires December 31, 2001 and the agreement at Cory expires on
April 30, 2002. The collective bargaining agreement with the union representing
employees at the White Springs plant expires on December 1, 2003 and the
collective agreement at the PCS Purified Phosphates facility in Cincinnati
expires November 1, 2001. PCS Nitrogen has one location in Memphis with a
collective bargaining

                                       I-14
<PAGE>   16

agreement which expires September 17, 2004. In addition, the agreement between
BPC and the union representing employees at the Lima plant expires February 16,
2002. The Company believes its relations with its employees to be good.

ROYALTIES AND CERTAIN TAXES

     Saskatchewan potash production is taxed at the provincial level under The
Mineral Taxation Act, 1983 (Saskatchewan). This tax consists of a base payment
and a profit tax. In addition to the Potash Production Tax, rental fees, taxes
and royalties are payable to the Province of Saskatchewan and municipalities by
potash producers in respect of potash reserves or production of potash in the
Province of Saskatchewan. The Company's taxes, fees and royalty expenses were
$70.7 million in 2000.

     The Company is subject to capital tax on its paid-up capital (as defined in
The Corporation Capital Tax Act of Saskatchewan) and its taxable capital (as
defined in the New Brunswick Income Tax Act). In addition, a resource
corporation in the Province of Saskatchewan pays a corporate capital tax surtax
based on the value of Saskatchewan resource sales. This surtax is only payable
to the extent that it exceeds the regular capital tax. In 2000, the Company paid
capital tax of $3.2 million and surtax of $16.5 million.

     The Company pays royalties to the New Brunswick government on the basis of
production from its New Brunswick mine. In addition, the Company pays municipal
taxes. The Company's expenses for such royalties and municipal taxes were $5.3
million in 2000.

     The Company does not make royalty payments in connection with its phosphate
and nitrogen operations.

INCOME TAXES

     PCS and certain subsidiaries are subject to federal income taxes (which
includes the Large Corporations Tax) and provincial income taxes in Canada.

     The subsidiaries of the Company which operate in the United States are
subject to U.S. federal and state income taxes. These subsidiaries are not
currently subject to federal cash income taxes by virtue of net operating losses
incurred. The Company's nitrogen subsidiaries operating in Trinidad are subject
to Trinidad taxes.

     The effective consolidated rate for 2000 was 27% of pre-tax income
exclusive of the gain on disposal of shares of a subsidiary recorded in the
first quarter of 2000 (1999 -- 30% -- exclusive of the goodwill impairment
charges recorded in the third quarter of 1999).

RESEARCH AND DEVELOPMENT

     The Company maintains potash research and development facilities located in
Saskatoon, Saskatchewan, employing approximately 30 persons who concentrate on
improving efficiency in mine operations and product quality. Research continues
on the use of three-dimensional seismic methods and other geophysical tools to
detect geological disturbances in potash ore bodies. The Company is also
proceeding with automation of mining machines and improving process control in
mills. Other research includes new product development and measures to maintain
and enhance product quality in transit and at offsite storage facilities. The
Company funds research in agronomy through Potash & Phosphate Institute
programs.

     The Company is exploring ways of further debottlenecking its phosphate and
nitrogen production facilities, selectively adding capacity and otherwise
enhancing production and process efficiencies through technological
enhancements. Development work has also identified new markets for existing
products and methods to enhance product quality. The Geismar Facility is
exploring the possibility of manufacturing gypsum product from its phosphoric
acid operations.

ENVIRONMENTAL MATTERS

     The Company's operations are subject to numerous environmental requirements
under Canadian, U.S., Chilean, Brazilian and Trinidad and Tobago federal,
provincial, state and local laws and regulations. Such laws

                                       I-15
<PAGE>   17

and regulations govern, among other matters, air emissions, waste water
discharges, land use and reclamation and solid and hazardous waste management.
Many of these laws and regulations are becoming increasingly stringent, and the
cost of compliance with these requirements can be expected to increase over
time. An on-going U.S. federal grand jury investigation regarding environmental
matters at the Geismar Facility and certain other environmental matters that are
the subject of investigation or litigation are discussed under the heading
"Legal Proceedings".

     The Company believes that it is currently in material compliance with
applicable environmental laws and regulations. The Company believes that it is
well positioned to meet anticipated requirements under the applicable
environmental laws and regulations. Although significant capital expenditures
and operating costs have been incurred and will continue to be incurred on
account of environmental laws and regulations, the Company does not believe,
except as otherwise set out herein, that such environmental laws and regulations
have had, or will have, a material adverse effect on its business. However, the
Company cannot predict the impact of new or changed laws or regulations or
permit requirements, including the matters discussed below, or changes in the
ways that such laws and regulations are administered, interpreted, or enforced.
The Company anticipates that its routine expenditures related to environmental
regulatory matters in 2001 will not differ materially from the previous year.

     The Company and its facilities are also subject to various environmental
statutes and programs focused on site reclamation and restoration and on
investigation and, where necessary, remediation of contaminated properties. The
Company's obligations and potential liabilities under these programs have been
and can be expected to continue to be significant. The Company does not believe,
except as set out herein, that such obligations and potential liabilities have
had, or will have, a material adverse effect on its business. However, it is
often difficult to estimate and predict the potential costs and liabilities
associated with these programs and there is no guarantee that the Company will
not in the future be identified as potentially responsible for additional costs
under these programs, either as a result of changes in existing laws and
regulations or as a result of the identification of additional matters or
properties covered by these programs.

ENVIRONMENTAL EXPENDITURES

Reclamation and Restoration Costs

     Site restoration and reclamation costs have been accrued for various sites.
At December 31, 2000, the Company had accrued the following amounts for site
reclamation and restoration: $27.3 million for the Aurora Facility, $54.9
million for the White Springs Facility, $0.3 million for various idle sulfur
facilities, $18.6 million for certain Florida Favorite Fertilizer facilities,
and $4.2 million for the Cassidy Lake Facility. The idle sulfur facilities were
part of the acquisition of Texasgulf and are undergoing dismantlement and
environmental restoration efforts. The current portion of restoration and
reclamation costs accrued in 2000 totalled $22.3 million. These amounts
represent the Company's current estimate of potential site restoration and
reclamation costs as last assessed in December 2000. The expenditures are
generally incurred over an extended period of time.

     Annual environmental expenditures for reclamation and restoration during
the year ended December 31, 2000 were $59.9 million. Of this amount, $55.2
million was charged to operations, $2.7 million was capitalized and $2.0 million
was charged against accrued reclamation costs.

Capping of Byproduct Gypsum Stacks

     Production of phosphoric acid also produces gypsum, which is normally
placed in above-ground storage areas called gypsum stacks. Various jurisdictions
have established programs that require companies to reduce the potential
environmental impacts associated with gypsum stacks. In Florida, these
regulations require companies to "cap" the gypsum stacks in order to reduce
seepage into groundwater when such stacks reach their design capacity (for the
Company, in approximately 35 years), or after March 25, 2001 if groundwater
standards are not being met. The Company has submitted documentation to the
Florida Department of Environmental Protection ("FDEP") to demonstrate its
compliance with this rule. The Company expects to be allowed to continue using
the three gypsum stacks at the White Springs Facility for their remaining useful

                                       I-16
<PAGE>   18

lives of approximately 35 years. At December 31, 2000, a balance of $35.4
million was included in accrued reclamation costs for this gypsum stack capping
requirement. The obligations of White Springs regarding the gypsum stacks are
guaranteed by PCS. In the event continued use of the stacks at White Springs
were to be prohibited in the near term under these regulations, the prohibition
would result in a closure/new stack cost currently estimated in excess of $100
million.

     The Company also has gypsum stacks at the Aurora Facility in North Carolina
and the Geismar Facility in Louisiana. In North Carolina, on exhaustion of the
mine's phosphate reserves, disposition of the remaining gypsum must comply with
the laws in effect at that time. The inactive portions of the gypsum stacks at
the Geismar Facility must be capped and have stormwater runoff collected. Under
the current laws in North Carolina and Louisiana, the closure or decommissioning
of the gypsum stacks at these two facilities is not expected to have a material
adverse effect on the Company's business.

Other Environmental Costs

     The Company's operating expenses, other than reclamation and restoration
and gypsum stack capping, relating to compliance with environmental laws and
regulations governing ongoing operations were approximately $23.0 million for
the year ended December 31, 2000 as compared to $20.2 million for the year ended
December 31, 1999.

Capital Expenditures

     The Company routinely undertakes capital projects to improve pollution
control facilities. In 2000, a total of approximately $11.7 million in capital
expenditures (exclusive of capitalized reclamation expenditures) was spent to
meet the Company's environmental control objectives as compared to $5.1 million
in 1999. The Company expects that its capital requirements for environmental
projects may increase in the future due to increasingly stringent environmental
regulations arising from current and future requirements of law.

     With respect to air emissions, the Company anticipates that additional
expenditures may be required to meet increasingly stringent U.S. federal and
state regulatory and permit requirements, including existing and anticipated
regulations under the U.S. federal Clean Air Act as amended in 1990. Both
federal and state regulation of hazardous air pollutants are expected to require
additional air emission control equipment and increased operating expenditures
at some U.S. facilities. In particular, recent rules require specific new
controls for hydrogen fluoride emissions in phosphoric acid production. Some
states, including Louisiana, also regulate ammonia and nitric acid as hazardous
air pollutants. Further, the U.S. Environmental Protection Agency ("EPA") has
published new National Ambient Air Quality Standards for both ozone and
particulate matter which are more stringent than existing standards and has
issued a number of regulations establishing requirements to reduce nitrogen
oxide (NOx) emissions. The Company continues to monitor developments in these
various programs and to assess their potential impact on the Company's
operations.

     The federal Clean Air Act operating permit program requires the addition of
enhanced emissions monitoring equipment at some facilities, as well as the
imposition of permit fees based upon facility air pollutant emissions. If the
Company undertakes facility expansion at its U.S. plants, preconstruction air
permits (under either the federal Prevention of Significant Deterioration or New
Source Review programs) may need to be obtained for any such expansion of these
facilities. Such permits would impose certain restrictions on air pollutant
emissions from the expanded plants and compliance with those restrictions could
require installation and use of additional pollution control devices.

SITE ASSESSMENT AND REMEDIATION

     In addition to environmental regulation of its current operations, the
Company also may incur costs and liabilities in connection with its and its
predecessors' past and current waste disposal practices and ownership and
operation of real property and facilities, as well as its mining activities. The
U.S. federal Comprehensive Environmental Response, Compensation and Liability
Act of 1980 ("CERCLA") and other U.S. federal and state laws impose liability
on, among others, past and present owners and operators of properties or
facilities at which hazardous substances have been released into the environment
and persons who arrange for disposal of

                                       I-17
<PAGE>   19

hazardous substances that are released into the environment. Liability under
these laws may be imposed jointly and severally and without regard to fault or
the legality of the original actions, although such liability may be divided or
allocated according to various equitable and other factors. In the course of its
current and former operations, including those of divested and acquired
businesses, the Company has generated, and with respect to its current
operations, continues to generate wastes that could result in liability for the
Company under these laws.

     The EPA is conducting an investigation into soil and groundwater
contamination of a PCS Joint Venture blending facility located in Lakeland,
Florida and certain adjoining property. In 1998, EPA notified the Company of
potential liability under Section 107(a) of CERCLA. On October 21, 1999, PCS
Joint Venture signed an Administrative Order on Consent with the EPA in which
PCS Joint Venture agreed to conduct a Remedial Investigation and Feasibility
Study ("RI/FS") for the Lakeland Facility and other area properties (the "Landia
Site"). On October 13, 1999, PCS Joint Venture had submitted to the EPA Phase I
of a work plan to conduct the RI/FS. Starting in September 1999, the EPA
conducted additional investigations of environmental conditions at focused areas
of the Landia Site. In February 2000, the EPA notified PCS Joint Venture and two
other entities of the Agency's intent to undertake interim site response
activities at specific areas of the Landia Site in the event the responsible
parties were unable to make a timely commitment to conduct these site response
activities pursuant to a proposed Administrative Order on Consent. On June 5,
2000, PCS Joint Venture and another entity entered into an Administrative Order
on Consent pursuant to which they undertook certain of the interim response
activities at the Landia Site. The interim response activities have been
completed. No final determination has yet been made of the nature, timing, or
cost of further remedial action that may be needed.

     FDEP is also conducting an investigation into soil and ground water
contamination at the Landia Site. On April 8, 1997, FDEP filed a Complaint and
Petition for Enforcement against PCS Joint Venture and others. The Company filed
an Answer, Affirmative Defenses and Cross Claims on May 12, 1997. The matter has
remained relatively inactive since the involvement of EPA in the site.

     In 1994, EPA and the Georgia Department of Natural Resources, Environmental
Protection Division ("GEPD") separately wrote to PCS Joint Venture seeking
certain environmental information regarding its Moultrie, Georgia location.
Responses to both requests have been provided by PCS Joint Venture. Preliminary
investigations have confirmed the presence of lead-contaminated soil at the
site. The initial assessment is that this lead contamination is attributable to
former operations at the site, the facilities of which were dismantled some time
ago. However, a complete assessment of the site has not yet been completed, and
the full nature and extent of the contamination cannot be quantified at this
time. A proposed corrective action plan was filed in 1999 but no recommended
course of action has yet been approved by GEPD.

     PCS Joint Venture is co-operating with regulatory authorities in their
investigations of the Lakeland and Moultrie sites. It is also attempting to
determine the number and location of other parties who may be liable for
remediation of these sites. However, because site assessments are ongoing and
because other parties may be liable for some or all costs of remediation, the
ultimate liability of PCS Joint Venture has not yet been determined.

     The Company is also engaged in ongoing site assessment and/or remediation
activities at a number of other facilities currently or previously owned or
operated by the Company. In each instance, the Company is working with the
appropriate regulatory authorities to address these sites. In addition, the
Company has in the past received notices identifying it as a potentially
responsible party with respect to certain sites that were never owned or
operated by the Company. The Company has reviewed information pertinent to these
sites and has responded to each of these notices. Based on current information
about these various facilities and sites and other potentially responsible
parties, the Company believes that the Company's future obligation with respect
to these facilities and sites will not have a material adverse effect on the
Company's financial condition or results of operation.

                                       I-18
<PAGE>   20

PERMITS AND REGULATORY APPROVALS

     Many of the Company's operations and facilities are required by federal,
provincial, state and local environmental laws to obtain and operate in
compliance with a range of permits and regulatory approvals. Such permits and
approvals typically have to be renewed or reissued periodically. The Company may
also become subject to new laws or regulations that require it to obtain new or
additional permits or approvals. The Company believes that it is currently in
material compliance with its existing permits and regulatory approvals. However,
there can be no assurance that such permits or approvals will issue in the
ordinary course. Further, the terms and conditions of future permits and
approvals may be more stringent and may require increased expenditures on the
part of the Company.

     A significant portion of the Company's phosphate reserves in Aurora, North
Carolina is located in wetlands and, under the U.S. federal Clean Water Act, a
permit must be obtained from the U.S. Army Corps of Engineers (the "Corps")
before mining activity that will disturb the wetlands may occur. As part of the
permit process for PCS Phosphate, the Corps issued a draft Environmental Impact
Statement in January 1994 which was supplemented in May 1995. In 1997, PCS
Phosphate received its required authorizations from the State of North Carolina
and on August 14, 1997, the Corps issued a permit granting approval to mine
certain areas described in the Environmental Impact Statement through 2017. The
permit contains a section on wetlands mitigation approach and methods regarding
wetland impacts associated with mining covered by the permit. The Company has
acquired additional land adjacent to the Aurora Facility for mitigation
purposes. In order to demonstrate the feasibility of such activities, as of
December 31, 2000, the Company had created or restored 2,904 acres of wetlands.

     On May 6, 1999, the Southern Environmental Law Center ("SELC") and the
Pamlico-Tar River Foundation ("PTRF") gave notice to the EPA and the Department
of the Army of their intent to file a civil action under the citizens suit
provisions of the Clean Water Act. To date, no such action has been filed. The
notice letter asserts that the Corps failed to comply with certain provisions of
the Clean Water Act when it issued a permit to PCS Phosphate in August 1997. The
notice letter also requests revocation of the permit. PCS Phosphate believes
that the permit was properly issued. PCS Phosphate intends to monitor the status
of this matter and take any steps needed to protect its ability to continue the
operations authorized by the permit.

     In addition to the wetlands permit from the Corps, the Company also needs
additional authorizations from agencies of the State of North Carolina to
continue its mining activities in North Carolina. The Company is required to
have State mining permits that contain bonding and reclamation requirements. The
Company has a State mining permit for the areas presently being mined by the
Company that is effective through 2003, but this permit must be amended
periodically to add additional acreage during this period. The Company also
holds another mining permit from the State for the area of the property that
contains the wetlands covered by the permit issued by the Corps. This State
permit has been renewed until 2005.

     The gypsum stacks at the White Springs Facility will continue to be used
and when closed will be covered or capped to the extent required under
applicable regulations. The Florida Phosphogypsum Rule permits the use of
existing gypsum stacks until they reach capacity, if groundwater standards are
met as of and after March 25, 2001. Due to the curtailment of phosphoric acid
production at the White Springs Facility, the Company will submit a request for
the temporary deactivation of two of the three gypsum stacks. This request must
be renewed annually as long as the gypsum stacks are temporarily inactive. If
this request were not granted and the stacks remained inactive, then the closure
and capping requirements for gypsum stacks would become applicable to these two
stacks. See "Environmental Expenditures -- Capping of Byproduct Gypsum Stacks".

     Lands mined by White Springs after July 1, 1975 and unmined lands used in
certain mining operations after July 1, 1984 are subject to mandatory
reclamation requirements of the State of Florida. Wetlands must be reclaimed on
an acre-for-acre basis under the rules of the FDEP unless otherwise provided in,
or pursuant to, a Memorandum of Agreement ("MOA"), dated February 1, 1995,
between OxyChem and FDEP (which agreement was later assigned to the Company).
The MOA established alternate procedures for the Company to follow. The current
practice of White Springs is to return most upland areas to commercial pine
plantation, which is the predominant pre-operation land use. Reclaimed lands
include uplands, wetlands and lakes.

                                       I-19
<PAGE>   21

     Land reclamation at White Springs is currently performed pursuant to
federal, state, and local regulatory approvals granted in 1996 and 1997 to
implement the 1995 MOA between OxyChem and FDEP. The MOA provides for mitigation
of mining impacts in a portion of the mining area, particularly impacts to
wetlands, to be done through funding of public acquisition of environmentally
sensitive lands in the region. Land reclamation continues to be done on-site but
is undertaken using the alternate standards of the MOA which do not require the
on-site reclamation of wetlands and which allow for the construction of lands
that are expected to be of greater future utility. The Company's contributions
for the land acquisition program through 2000 totalled $5.2 million.

     White Springs has initiated a process for securing an additional federal
permit and ancillary modifications of state and local regulatory approvals
needed for continuation of mining operations beyond the expiration of its
current federal permit in 2002. The process involves environmental studies of
potential mining areas and evaluation of mine plan and reclamation alternatives.
All affected regulatory authorities, various commenting agencies, and interested
outside parties are participating in the process. Selection of mine plan and
reclamation alternatives and the results of the environmental studies could
result in changes to reclamation and mitigation practices with higher costs and
changes to mining areas with reserve impacts. The magnitude of such cost impacts
cannot be estimated until the studies and evaluations are completed. Failure to
secure the required approvals for continuation of the mining operations under
any reclamation or mitigation alternative would negatively affect reserves and
costs.

POTASH DECOMMISSIONING REGULATIONS

     The environmental regulations of the Province of Saskatchewan require each
potash mine to have decommissioning and reclamation (D&R) plans. Financial
assurances for these plans must be established within one year following
approval of these plans by the responsible provincial minister. Pursuant to the
regulations, the Company filed D&R plans with the Minister of the Environment
for Saskatchewan, in the spring of 1997. In February 1998, the Company was
advised that, although the D&R plans were technically acceptable, the regulatory
agency did not accept the schedule proposed to decommission the waste salt
piles. Following further discussions between the provincial potash industry and
the regulatory agency, the Company was advised in July 2000 that the D&R plans
submitted in 1997 were accepted, provided that the plans are revised by 2005. A
government-industry task force was established to produce mutually acceptable
revisions of the plans which would incorporate a cost benefit analysis of the
decommissioning options. The process of revising the D&R plans is continuing.
Concurrently, a committee of industry and government financial experts is
examining the financial instruments that could be used to provide financial
assurance for the D&R plans in the interim period before 2005. A recommendation
from this committee is expected in 2001. Because of the uncertainty regarding
the final nature of the D&R plans, the timing of implementation and the
structure of the financial assurance, the Company is unable, at this time, to
accurately estimate the financial implications of the plans.

GOVERNMENT REGULATIONS

     In September 1987, legislation was adopted in Saskatchewan that authorized
the government to control production at potash mines located in the Province of
Saskatchewan. The legislation, which has not taken effect but which can be
brought into effect by proclamation of the Cabinet of Saskatchewan, permits the
Cabinet, and the Potash Resources Board which would be created under such
legislation, to prescribe rates of potash production in Saskatchewan and to
allocate production among individual mines. The Company cannot predict at this
time if or when the legislation will be proclaimed or its impact on the
Company's financial condition or results of operations.

                                       I-20
<PAGE>   22

EXECUTIVE OFFICERS OF THE COMPANY

     The name, age, period of service and position held for each of the
executive officers of the Company as at March 15, 2001 are as follows:

<TABLE>
<CAPTION>
                                               SERVED
NAME                                     AGE   SINCE    POSITION HELD
----                                     ---   ------   -------------
<S>                                      <C>   <C>      <C>
WILLIAM J. DOYLE.......................  50     1987    President and Chief Executive Officer
JAMES F. DIETZ.........................  54     1997    Executive Vice President &
                                                        Chief Operating Officer
WAYNE R. BROWNLEE......................  48     1988    Senior Vice President, Treasurer and
                                                        Chief Financial Officer
JOHN L. M. HAMPTON.....................  47     1988    Senior Vice President, General Counsel and
                                                        Secretary
BETTY-ANN L. HEGGIE....................  47     1981    Senior Vice President, Corporate Relations
BARRY E. HUMPHREYS.....................  57     1976    Senior Vice President and
                                                        Chief Information Officer
BARBARA JANE IRWIN.....................  45     2000    Senior Vice President, Administration
G. DAVID DELANEY.......................  40     1997    President, PCS Sales
GARTH W. MOORE.........................  52     1982    President, PCS Potash
THOMAS J. REGAN, JR....................  56     1995    President, PCS Phosphate
KAREN G. CHASEZ........................  47     2000    Vice President, Procurement,
                                                        PCS Administration (USA)
ROBERT A. JASPAR.......................  42     1997    Vice President, Internal Audit
DONALD R. ROBERTS......................  61     1993    Vice President, Safety, Health and
                                                        Environment, PCS Administration (USA)
DENIS A. SIROIS........................  45     1978    Vice President and Corporate Controller
</TABLE>

     All of the officers have had the principal occupation indicated for the
previous five years except as follows: Mr. Doyle was President and Chief
Operating Officer of the Company from July 1, 1998 to July 1, 1999; was
President PCS Sales from March 1997 to July 1998 and Executive Vice President,
Potash and Sales, of the Company from 1995 until March 1997. Mr. Dietz was Vice
President, Manufacturing of Arcadian from 1993 to March 1997, Executive Vice
President of PCS Nitrogen from March 1997 to July 1998, and President of PCS
Nitrogen from July 1998 to November 2000. On July 12, 1999, Mr. Brownlee was
appointed Senior Vice President, Treasurer and Chief Financial Officer. Mr.
Brownlee was Senior Vice President Expansion and Development from May 1995 to
July 1999. On July 12, 1999, Mr. Humphreys was appointed Senior Vice President
and Chief Information Officer. Mr. Humphreys was Senior Vice President Finance
and Treasurer and Chief Financial Officer from December 1989 to July 1999. Prior
to October 2000, Ms. Irwin was a Consultant and Principal with Hewitt Associates
LLC, human resources consultants. Mr. Delaney was appointed President, PCS Sales
on March 24, 2000. Mr. Delaney was Vice President, Industrial Sales of PCS Sales
from March 1997 to March 24, 2000 and was Vice President Agricultural Sales East
for Arcadian Corporation prior to March 1997. Prior to March 1997, Mr. Moore was
Senior Vice President, Technical Services of the Company. Mr. Regan was
Executive Vice President of PCS Phosphate from March 1997 to July 1999, and Vice
President, Administration for PCS Phosphate from 1995 to 1997. Ms. Chasez was
Vice President, Administration & Business Affairs for British Sulphur North
America Inc. from June 1990 to May 2000. Mr. Jaspar was Director, Internal Audit
from January to November 2000, Senior Auditor of the Corporation from July 1997
to December 1999 and Senior Manager at Deloitte & Touche prior to 1997. Mr.
Roberts was Vice President, Technical Services, PCS Potash from April 1997 to
May 2000 and General Manager, New Brunswick Division prior to April 1997. Mr.
Sirois was Controller of the Company prior to 1997.

                                       I-21
<PAGE>   23

ITEM 3.  LEGAL PROCEEDINGS.

CIVIL ANTITRUST COMPLAINTS

     In June 1993, PCS and PCS Sales (Canada) Inc. ("PCS Sales (Canada)") were
served with a complaint relating to a suit filed in the United States District
Court for Minnesota against most North American potash producers, including the
Company. The complaint alleged a conspiracy among the defendants to fix the
price of potash purchased by the plaintiffs as well as potash purchased by the
members of a class of certain purchasers proposed by the plaintiffs. Similar
complaints were filed in the United States District Courts for the Northern
District of Illinois and the Western District of Virginia. On motion of the
defendants, all of the complaints were transferred and consolidated for
pre-trial purposes in the United States District Court for Minnesota. The
complaint sought treble damages and other relief. PCS and PCS Sales (Canada)
filed a motion for summary judgment on December 22, 1995. On January 2, 1997,
Judge Richard H. Kyle issued an order granting the defendants' motions for
summary judgment and dismissing the lawsuit. The plaintiffs appealed that order
to the United States Court of Appeals for the Eighth Circuit. On February 17,
2000, the Eighth Circuit, en banc, affirmed Judge Kyle's summary judgment
ruling. On October 2, 2000, the United States Supreme Court denied the
plaintiffs' petition for writ of certiori. Accordingly, the claims of the
federal court plaintiffs have now been fully and finally dismissed.

     Additional complaints were filed in the California and Illinois state
courts on behalf of purported classes of indirect purchasers of potash in those
states. PCS moved to dismiss the California State Court lawsuits for lack of
personal jurisdiction and the court ruled that it does not have personal
jurisdiction over PCS but that it does have personal jurisdiction over PCS Sales
(Canada). Following Judge Kyle's summary judgment decision, the California
litigation was stayed, and the plaintiffs agreed to dismiss their lawsuit if
Judge Kyle's summary judgment ruling withstood appeal. The claims have now been
fully and finally dismissed. The Illinois State Court complaint was dismissed
for failure to state a cause of action and that decision is final and not
subject to appeal.

FORMER ARCADIAN EXECUTIVE PROCEEDINGS

     On May 7, 1997, J. Douglas Campbell, Alfred L. Williams and Peter H.
Kesser, former officers of Arcadian, filed lawsuits against the Company in the
United States District Court for the Western District of Tennessee. The
complaints allege that the Company breached employment agreements between
Arcadian and the officers and breached the related assumption agreement among
the Company, PCS Nitrogen, and Arcadian. The complaints of Mr. Campbell, Mr.
Williams and Mr. Kesser seek damages in excess of $22.2 million, $6.2 million
and $3.7 million, respectively. On August 11, 1998, the Court ruled that the
Company had assumed the obligations of the employment agreements and that
equitable claims and defenses asserted against the executives for breaches of
fiduciary duties, corporate waste, and self-dealing should be asserted by PCS
Nitrogen in the state court action described below. On December 1, 1998 the
court entered judgments in the amounts of $12.7 million, $3.2 million, and $2.6
million in favor of Mr. Campbell, Mr. Williams and Mr. Kesser, plus additional
amounts sufficient to offset the impact of certain excise taxes, if applicable.
On February 2, 2001, the Appellate Court substantially affirmed the judgment and
remanded the case for further proceedings, which are expected to result in a
reduction of the judgments by approximately $1 million.

     Still pending is an action which the Company and PCS Nitrogen filed in the
Circuit Court of Tennessee for the Thirtieth Judicial District at Memphis
against Messrs. Campbell, Williams and Kesser for declaratory relief and
damages. The Company and PCS Nitrogen alleged that the defendants committed
breaches of their fiduciary duties in the negotiation of, obtaining approval
for, and execution of the employment agreements each of them had with Arcadian.
The Company and PCS Nitrogen also seek a declaratory judgment that the
employment agreements are unenforceable. The defendants counterclaims appear to
seek damages substantially equivalent to the damages sought in their
individually filed suits as plaintiffs.

     Management of the Company believes that the lawsuits will not have a
material adverse effect on the Company's financial condition or results of
operations.

                                       I-22
<PAGE>   24

GEISMAR FACILITY INVESTIGATION

     On May 11 and May 12, 1999, representatives of the EPA, Federal Bureau of
Investigation, and other state and local agencies ("governmental agencies")
executed a search warrant issued by the United States District Court for the
Middle District of Louisiana on the Geismar Facility in connection with a grand
jury investigation. In executing the search warrant, the governmental agencies
seized documents and electronic media, performed environmental sampling, and
interviewed Geismar Facility employees and contract employees. In addition, the
governmental agencies have contacted former Geismar Facility employees in
connection with the investigation. The Company has also been served with grand
jury subpoenas requesting documents and other information from the Geismar
Facility and PCS Nitrogen's headquarters. The grand jury investigation is
continuing. The Company is also conducting its own internal investigation. The
Company cannot predict at this time what may result from the governments'
investigation or whether any such result would have a material adverse effect on
the Company.

LAKELAND, FLORIDA PROCEEDING

     On September 23, 1999, an action was served on PCS Joint Venture and eight
other defendants on behalf of a class of persons living in the vicinity of the
site who claim to have suffered damages as a result of releases from the PCS
Joint Venture facility in Lakeland, Florida and other area properties. PCS Joint
Venture has reached an agreement in principle to settle the matter, which
settlement is not expected to have a material adverse effect on the Company.
Before the settlement can be finalized, class members will receive notice of the
proposed settlement and be provided an opportunity to opt out prior to a
fairness hearing before the trial court, which hearing is expected to take place
later in 2001.

ENVIRONMENTAL PROCEEDINGS

     For a description of certain environmental proceedings involving the
Company, see "Environmental Matters".

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

     Not applicable.

                                       I-23
<PAGE>   25

                                    PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

     The information under "Common Share Prices and Volumes", "Shareholder
Information -- Ownership" and "10-Year Report" in the registrant's 2000 Annual
Report is incorporated herein by reference.

     Dividends paid to U.S. holders of Common Shares, who do not use the shares
in carrying on a business in Canada, will be subject to a Canadian withholding
tax under the Income Tax Act. Under the Canada-U.S. Income Tax Convention (1980)
(the "Convention"), the rate of withholding is generally reduced to 15 percent.
Subject to certain limitations, the Canadian withholding tax will be treated as
a foreign income tax that can generally be claimed as a deduction from income or
as a credit against the U.S. income tax liability of the holder. Holders will
generally not be subject to tax under the Income Tax Act with respect to any
gain realized from a disposition of Common Shares.

ITEM 6.  SELECTED FINANCIAL DATA.

     The information under "10-Year Report" in the registrant's 2000 Annual
Report is incorporated herein by reference.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS.

     The information under "Management's Discussion and Analysis of Financial
Condition and Results of Operations" in the registrant's 2000 Annual Report,
filed as Exhibit 13, is incorporated herein by reference.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

     The Consolidated Financial Statements contained in the registrant's 2000
Annual Report, filed as Exhibit 13, are incorporated herein by reference.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE.

     Not applicable.

                                       II-1
<PAGE>   26

                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

     The information under "Election of Directors" in the 2001 Proxy Circular,
attached as Exhibit 99, is incorporated herein by reference. Information
concerning executive officers is set forth under "Executive Officers of the
Company" in Part I.

ITEM 11.  EXECUTIVE COMPENSATION.

     The information under "Executive Compensation" in the 2001 Proxy Circular,
attached as Exhibit 99, is incorporated herein by reference. Each incorporation
by reference shall be deemed not to include the information referred to in Item
402(a)(8) of Regulation S-K.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     The information under "Ownership of Shares" and "Election of Directors" in
the 2001 Proxy Circular, attached as Exhibit 99, is incorporated herein by
reference.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     The information under "Election of Directors" and "Executive Compensation"
in the 2001 Proxy Circular, attached as Exhibit 99, is incorporated herein by
reference.

                                      III-1
<PAGE>   27

                                    PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.

(a) List of Documents Filed as Part of this Report

1.   Consolidated Financial Statements in Annual Report

<TABLE>
<S>                                                           <C>
Auditors' Report............................................     46
Consolidated Statements of Financial Position...............     47
Consolidated Statements of Income and Retained Earnings.....     48
Consolidated Statements of Cash Flow........................     49
Notes to the Consolidated Financial Statements..............  50-66
</TABLE>

2.   Schedules

     All Schedules are omitted because the required information is inapplicable
or it is presented in the Consolidated Financial Statements.

3.   Exhibits

<TABLE>
<CAPTION>
EXHIBIT
NUMBER                     DESCRIPTION OF DOCUMENT
-------                    -----------------------
<C>      <S>
  2      Agreement and Plan of Merger dated September 2, 1996, as
         amended, by and among the registrant, Arcadian Corporation
         and PCS Nitrogen, Inc., incorporated by reference to Exhibit
         2(a) to Amendment Number 2 to the registrant's Form S-4
         (File No. 333-17841).

 3(a)    Restated Articles of Incorporation of the registrant dated
         October 31, 1989, as amended May 11, 1995, incorporated by
         reference to Exhibit 3(i) to the registrant's report on Form
         10-K for the year ended December 31, 1995 (the "1995 Form
         10-K").

 3(b)    Bylaws of the registrant dated March 2, 1995, incorporated
         by reference to Exhibit 3(ii) to the 1995 Form 10-K.

 4(a)    Term Credit Agreement between The Bank of Nova Scotia and
         other financial institutions and the registrant dated
         October 4, 1996, incorporated by reference to Exhibit 4(b)
         to the registrant's Form S-4 (File No. 333-17841).

 4(b)    First Amending Agreement to Term Credit Agreement between
         The Bank of Nova Scotia and other financial institutions and
         the registrant dated November 6, 1997, incorporated by
         reference to Exhibit 4(b) to the registrant's report on Form
         10-K for the year ended December 31, 1997 (the "1997 Form
         10-K").

 4(c)    Second Amending Agreement to Term Credit Agreement between
         The Bank of Nova Scotia and other financial institutions and
         the registrant dated December 15, 1997, incorporated by
         reference to Exhibit 4(c) to the 1997 Form 10-K.

 4(d)    Third Amending Agreement to Term Credit Agreement between
         The Bank of Nova Scotia and other financial institutions and
         the registrant dated October 2, 1998, incorporated by
         reference to Exhibit 4(d) to the registrant's report on Form
         10-Q for the quarterly period ended September 30, 1998 (the
         "Third Quarter 1998 Form 10-Q").

 4(e)    Fourth Amending Agreement to Term Credit Agreement between
         The Bank of Nova Scotia and other financial institutions and
         the registrant dated September 30, 1999, incorporated by
         reference to exhibit 4(e) to the registrant's report on Form
         10-Q for the quarterly period ended September 30, 1999 (the
         "Third Quarter 1999 Form 10-Q").

 4(f)    Fifth Amending Agreement to Term Credit Agreement between
         The Bank of Nova Scotia and other financial institutions and
         the registrant dated September 28, 2000, incorporated by
         reference to exhibit 4(f) to the registrant's report on Form
         10-Q for the quarterly period ended September 30, 2000 (the
         "Third Quarter 2000 Form 10-Q").
</TABLE>

                                       IV-1
<PAGE>   28

<TABLE>
<CAPTION>
EXHIBIT
NUMBER                     DESCRIPTION OF DOCUMENT
-------                    -----------------------
<C>      <S>
 4(g)    Indenture dated as of June 16, 1997, between the registrant
         and The Bank of Nova Scotia Trust Company of New York,
         incorporated by reference to Exhibit 4(a) to the
         registrant's report on Form 8-K dated June 18, 1997.
</TABLE>

     The registrant hereby undertakes to file with the Securities and Exchange
Commission, upon request, copies of any constituent instruments defining the
rights of holders of long-term debt of the registrant or its subsidiaries that
have not been filed herewith because the amounts represented thereby are less
than 10% of the total assets of the registrant and its subsidiaries on a
consolidated basis.

<TABLE>
<CAPTION>
EXHIBIT
NUMBER                     DESCRIPTION OF DOCUMENT
-------                    -----------------------
<S>      <C>
10(a)    Sixth Voting Agreement dated April 22, 1978, between Central
         Canada Potash, Division of Noranda, Inc., Cominco Ltd.,
         International Minerals and Chemical Corporation (Canada)
         Limited, PCS Sales and Texasgulf Inc., incorporated by
         reference to Exhibit 10(f) to the F-1 Registration
         Statement.

10(b)    Canpotex Limited Shareholders Seventh Memorandum of
         Agreement effective April 21, 1978, between Central Canada
         Potash, Division of Noranda Inc., Cominco Ltd.,
         International Minerals and Chemical Corporation (Canada)
         Limited, PCS Sales, Texasgulf Inc. and Canpotex Limited as
         amended by Canpotex S & P amending agreement dated November
         4, 1987, incorporated by reference to Exhibit 10(g) to the
         F-1 Registration Statement.

10(c)    Producer Agreement dated April 21, 1978, between Canpotex
         Limited and PCS Sales, incorporated by reference to Exhibit
         10(h) to the F-1 Registration Statement.

10(d)    Canpotex/PCS Amending Agreement, dated with effect October
         1, 1992, incorporated by reference to Exhibit 10(f) to the
         1995 Form 10-K.

10(e)    Canpotex PCA Collateral Withdrawing/PCS Amending Agreement,
         dated with effect October 7, 1993, incorporated by reference
         to Exhibit 10(g) to the 1995 Form 10-K.

10(f)    Canpotex Producer Agreement amending agreement dated
         effective January 1, 1999.

10(g)    Agreement of Limited Partnership of Arcadian Fertilizer,
         L.P. dated as of March 3, 1992 (form), and the related
         Certificate of Limited Partnership of Arcadian Fertilizer,
         L.P., filed with the Secretary of State of the State of
         Delaware on March 3, 1992 (incorporated by reference to
         Exhibits 3.1 and 3.2 to Arcadian Partners L.P.'s
         Registration Statement on Form S-1 (File No. 33-45828)).

10(h)    Amendment to Agreement of Limited Partnership of Arcadian
         Fertilizer, L.P. and related Certificates of Limited
         Partnership of Arcadian Fertilizer, L.P. filed with the
         Secretary of State of the State of Delaware on March 6, 1997
         and November 26, 1997, incorporated by reference to Exhibit
         10(f) to the registrant's report on Form 10-K for the year
         ended December 31, 1998 (the "1998 Form 10-K").

10(i)    Geismar Complex Services Agreement dated June 4, 1984,
         between Honeywell International, Inc. and Arcadian
         Corporation, incorporated by reference to Exhibit 10.4 to
         Arcadian Corporation's Registration Statement on Form S-1
         (File No. 33-34357).

10(j)    Esterhazy Restated Mining and Processing Agreement dated
         January 31, 1978, between International Minerals and
         Chemical Corporation (Canada) Limited and the registrant's
         predecessor, incorporated by reference to Exhibit 10(e) to
         the F-1 Registration Statement.

10(k)    Agreement dated December 21, 1990, between International
         Minerals & Chemical Corporation (Canada) Limited and the
         registrant, amending the Esterhazy Restated Mining and
         Processing Agreement dated January 31, 1978, incorporated by
         reference to Exhibit 10(p) to the registrant's report on
         Form 10-K for the year ended December 31, 1990.
</TABLE>

                                       IV-2
<PAGE>   29

<TABLE>
<CAPTION>
EXHIBIT
NUMBER                     DESCRIPTION OF DOCUMENT
-------                    -----------------------
<S>      <C>
10(l)    Agreement effective August 27, 1998, between International
         Minerals & Chemical (Canada) Global Limited and the
         registrant, amending the Esterhazy Restated Mining and
         Processing Agreement dated January 31, 1978 (as amended),
         incorporated by reference to Exhibit 10(l) to the 1998 Form
         10-K.

10(m)    Agreement effective August 31, 1998, among International
         Minerals & Chemical (Canada) Global Limited, International
         Minerals & Chemical (Canada) Limited Partnership and the
         registrant assigning the interest in the Esterhazy Restated
         Mining and Processing Agreement dated January 31, 1978 (as
         amended) held by International Minerals & Chemical (Canada)
         Global Limited to International Minerals & Chemical (Canada)
         Limited Partnership, incorporated by reference to Exhibit
         10(m) to the 1998 Form 10-K.

10(n)    Operating Agreement dated May 11, 1993, between BP Chemicals
         Inc. and Arcadian Ohio, L.P., as amended by the First
         Amendment to the Operating Agreement dated as of November
         20, 1995, between BP Chemicals Inc. and Arcadian Ohio, L.P.
         ("First Amendment"), incorporated by reference to Exhibit
         10.2 to Arcadian Partners L.P.'s current report on Form 8-K
         for the report event dated May 11, 1993, except for the
         First Amendment which is incorporated by reference to
         Arcadian Corporation's report on Form 10-K for the year
         ended December 31, 1995.

10(o)    Second Amendment to Operating Agreement between BP
         Chemicals, Inc. and Arcadian Ohio, L.P., dated as of
         November 25, 1996, incorporated by reference to Exhibit
         10(k) to the 1997 Form 10-K.

10(p)    Manufacturing Support Agreement dated May 11, 1993, between
         BP Chemicals Inc. and Arcadian Ohio, L.P., incorporated by
         reference to Exhibit 10.3 to Arcadian Partners L.P.'s
         current report on Form 8-K for the report event dated May
         11, 1993.

10(q)    First Amendment to Manufacturing Support Agreement between
         BP Chemicals, Inc. and Arcadian Ohio, L.P., dated as of
         November 25, 1996, incorporated by reference to Exhibit
         10(l) to the 1997 Form 10-K.

10(r)    Amended and Restated Agreement for Lease dated as of May 16,
         1997, between Trinidad Ammonia Company, Limited Partnership,
         and PCS Nitrogen Fertilizer, L.P., incorporated by reference
         to Exhibit 10(n) to the registrant's report on Form 10-Q for
         the quarterly period ended June 30, 1997 (the "Second
         Quarter 1997 Form 10-Q").

10(s)    Amended and Restated Lease Agreement dated as of May 16,
         1997, between Trinidad Ammonia Company, Limited Partnership,
         and PCS Nitrogen Fertilizer, L.P., incorporated by reference
         to Exhibit 10(o) to the Second Quarter 1997 Form 10-Q.

10(t)    Amended and Restated Agreement for Lease dated as of May 16,
         1997, between Nitrogen Leasing Company, Limited Partnership,
         and PCS Nitrogen Fertilizer, L.P., incorporated by reference
         to Exhibit 10(p) to the Second Quarter 1997 Form 10-Q.

10(u)    Amended and Restated Lease Agreement dated as of May 16,
         1997, between Nitrogen Leasing Company, Limited Partnership,
         and PCS Nitrogen Fertilizer, L.P., incorporated by reference
         to Exhibit 10(q) to the Second Quarter 1997 Form 10-Q.

10(v)    Amended and Restated Purchase Option Agreement dated as of
         May 16, 1997, between Nitrogen Leasing Company, Limited
         Partnership, and PCS Nitrogen Fertilizer Operations, Inc.,
         incorporated by reference to Exhibit 10(r) to the Second
         Quarter 1997 Form 10-Q.

10(w)    Amended and Restated Purchase Option Agreement dated as of
         May 16, 1997, between Trinidad Ammonia Company, Limited
         Partnership and PCS Nitrogen Fertilizer Operations, Inc.,
         incorporated by reference to Exhibit 10(s) to the Second
         Quarter 1997 Form 10-Q.

10(x)    Agreement dated January 1, 1997 between the registrant and
         Charles E. Childers, incorporated by reference to Exhibit
         10(s) to the 1997 Form 10-K.

10(y)    Termination Agreement between the registrant and C.E.
         Childers dated November 21, 2000.
</TABLE>

                                       IV-3
<PAGE>   30

<TABLE>
<CAPTION>
EXHIBIT
NUMBER                     DESCRIPTION OF DOCUMENT
-------                    -----------------------
<S>      <C>
10(z)    Potash Corporation of Saskatchewan Inc. Stock Option Plan --
         Directors, as amended November 3, 1999, incorporated by
         reference to Exhibit 10(y) to the Third Quarter 1999 Form
         10-Q.

10(aa)   Potash Corporation of Saskatchewan Inc. Stock Option Plan --
         Officers and Employees, as amended January 23, 2001.

10(bb)   Short-Term Incentive Plan of the registrant effective
         January 2000, incorporated by reference to Exhibit 10(z) to
         the registrant's report on Form 10Q for the quarterly period
         ended March 31, 2000 (the "First Quarter 2000 Form 10-Q").

10(cc)   Long-Term Incentive Plan of the registrant effective January
         2000, incorporated by reference to Exhibit 10(aa) to the
         Second Quarter 2000 Form 10-Q.

10(dd)   Resolution and Forms of Agreement for Supplemental
         Retirement Income Plan, for officers and key employees of
         the registrant, incorporated by reference to Exhibit 10(o)
         to the 1995 Form 10-K.

10(ee)   Amending Resolution and revised forms of agreement regarding
         Supplemental Retirement Income Plan of the registrant,
         incorporated by reference to Exhibit 10(x) to the
         registrant's report on Form 10-Q for the quarterly period
         ended June 30, 1996.

10(ff)   Amended and restated Supplemental Retirement Income Plan of
         the registrant and text of amendment to existing
         supplemental income plan agreements, incorporated by
         reference to Exhibit (mm) to the Third Quarter 2000 Form
         10-Q.

10(gg)   Forms of Agreement dated December 30, 1994, between the
         registrant and certain officers of the registrant,
         concerning a change in control of the registrant,
         incorporated by reference to Exhibit 10(p) to the 1995 Form
         10-K.

10(hh)   Form of Agreement of Indemnification dated August 8, 1995,
         between the registrant and certain officers and directors of
         the registrant, incorporated by reference to Exhibit 10(q)
         to the 1995 Form 10-K.

10(ii)   Resolution and Form of Agreement of Indemnification dated
         January 24, 2001.

10(jj)   Chief Executive Officer Medical and Dental Plan.

10(kk)   Second Amended and Restated Membership Agreement dated
         January 1, 1995, among Phosphate Chemicals Export
         Association, Inc. and members of such association, including
         Texasgulf Inc., incorporated by reference to Exhibit 10(t)
         to the 1995 Form 10-K.

10(ll)   International Agency Agreement dated January 1, 1995,
         between Phosphate Chemicals Export Association, Inc. and
         Texasgulf Inc. establishing Texasgulf Inc. as exclusive
         marketing agent for such association's wet phosphatic
         materials, incorporated by reference to Exhibit 10(u) to the
         1995 Form 10-K.

10(mm)   Royalty Agreement dated October 7, 1993, by and between the
         registrant and Rio Algom Limited, incorporated by reference
         to Exhibit 10(x) to the 1995 Form 10-K.

10(nn)   Shareholder Rights Agreement as amended and restated on
         March 2, 1998, incorporated by reference to Schedule B to
         the registrant's proxy circular for the annual and special
         meeting of shareholders held on May 7, 1998.

11       Statement re Computation of Per Share Earnings

13       2000 Annual Report

21       Subsidiaries of the Registrant

23       Consent of Deloitte & Touche LLP

99       2001 Notice of Meeting, Proxy Circular and Form of Proxy
</TABLE>

                                       IV-4
<PAGE>   31

(b) Reports on Form 8-K

     No reports on Form 8-K were filed by the registrant during the fourth
quarter of 2000.

Copies of Exhibits to the Form 10-K may be obtained upon request from the
Corporate Secretary, Potash Corporation of Saskatchewan Inc., Suite 500, 122
First Avenue South, Saskatoon, Saskatchewan S7K 7G3, Canada. The Company
reserves the right to recover its reasonable expenses in providing copies of the
Exhibits, such expenses not to exceed $.25 per page.

                                       IV-5
<PAGE>   32

                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                     POTASH CORPORATION OF SASKATCHEWAN INC.

                                     By: /s/ WILLIAM J. DOYLE
                                       -----------------------------------------
                                       William J. Doyle
                                       President & Chief Executive Officer
                                       March 27, 2001

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
                SIGNATURE                                     TITLE                          DATE
                ---------                                     -----                          ----
<C>                                         <S>                                         <C>
          /s/ DONALD E. PHILLIPS            Chairman of the Board                       March 27, 2001
------------------------------------------
            Donald E. Phillips

          /s/ WAYNE R. BROWNLEE             Senior Vice President, Treasurer and Chief  March 27, 2001
------------------------------------------  Financial Officer
            Wayne R. Brownlee

           /s/ WILLIAM J. DOYLE             President and Chief Executive Officer       March 27, 2001
------------------------------------------
             William J. Doyle

          /s/ ISABEL B. ANDERSON            Director                                    March 27, 2001
------------------------------------------
            Isabel B. Anderson

          /s/ DOUGLAS J. BOURNE             Director                                    March 27, 2001
------------------------------------------
            Douglas J. Bourne

     /s/ HON. WILLARD Z. ESTEY, Q.C.        Director                                    March 27, 2001
------------------------------------------
        Hon. Willard Z. Estey, Q.C

            /s/ DALLAS J. HOWE              Director                                    March 27, 2001
------------------------------------------
              Dallas J. Howe

          /s/ JEFFREY J. MCCAIG             Director                                    March 27, 2001
------------------------------------------
            Jeffrey J. McCaig

          /s/ PAUL J. SCHOENHALS            Director                                    March 27, 2001
------------------------------------------
            Paul J. Schoenhals
</TABLE>
<PAGE>   33

<TABLE>
<CAPTION>
                SIGNATURE                                     TITLE                          DATE
                ---------                                     -----                          ----

<C>                                         <S>                                         <C>
           /s/ DARYL K. SEAMAN              Director                                    March 27, 2001
------------------------------------------
             Daryl K. Seaman

      /s/ E. ROBERT STROMBERG, Q.C.         Director                                    March 27, 2001
------------------------------------------
         E. Robert Stromberg, Q.C

             /s/ JACK G. VICQ               Director                                    March 27, 2001
------------------------------------------
               Jack G. Vicq

          /s/ BARRIE A. WIGMORE             Director                                    March 27, 2001
------------------------------------------
            Barrie A. Wigmore

           /s/ THOMAS J. WRIGHT             Director                                    March 27, 2001
------------------------------------------
             Thomas J. Wright
</TABLE>
<PAGE>   34

<TABLE>
<CAPTION>
EXHIBIT
NUMBER                          EXHIBIT INDEX
-------                         -------------
<C>      <S>
  2      Agreement and Plan of Merger dated September 2, 1996, as
         amended, by and among the registrant, Arcadian Corporation
         and PCS Nitrogen, Inc., incorporated by reference to Exhibit
         2(a) to Amendment Number 2 to the registrant's Form S-4
         (File No. 333-17841).

 3(a)    Restated Articles of Incorporation of the registrant dated
         October 31, 1989, as amended May 11, 1995, incorporated by
         reference to Exhibit 3(i) to the registrant's report on Form
         10-K for the year ended December 31, 1995 (the "1995 Form
         10-K").

 3(b)    Bylaws of the registrant dated March 2, 1995, incorporated
         by reference to Exhibit 3(ii) to the 1995 Form 10-K.

 4(a)    Term Credit Agreement between The Bank of Nova Scotia and
         other financial institutions and the registrant dated
         October 4, 1996, incorporated by reference to Exhibit 4(b)
         to the registrant's Form S-4 (File No. 333-17841).

 4(b)    First Amending Agreement to Term Credit Agreement between
         The Bank of Nova Scotia and other financial institutions and
         the registrant dated November 6, 1997, incorporated by
         reference to Exhibit 4(b) to the registrant's report on Form
         10-K for the year ended December 31, 1997 (the "1997 Form
         10-K").

 4(c)    Second Amending Agreement to Term Credit Agreement between
         The Bank of Nova Scotia and other financial institutions and
         the registrant dated December 15, 1997, incorporated by
         reference to Exhibit 4(c) to the 1997 Form 10-K.

 4(d)    Third Amending Agreement to Term Credit Agreement between
         The Bank of Nova Scotia and other financial institutions and
         the registrant dated October 2, 1998, incorporated by
         reference to Exhibit 4(d) to the registrant's report on Form
         10-Q for the quarterly period ended September 30, 1998 (the
         "Third Quarter 1998 Form 10-Q").

 4(e)    Fourth Amending Agreement to Term Credit Agreement between
         The Bank of Nova Scotia and other financial institutions and
         the registrant dated September 30, 1999, incorporated by
         reference to exhibit 4(e) to the registrant's report on Form
         10-Q for the quarterly period ended September 30, 1999 (the
         "Third Quarter 1999 Form 10-Q").

 4(f)    Fifth Amending Agreement to Term Credit Agreement between
         The Bank of Nova Scotia and other financial institutions and
         the registrant dated September 28, 2000, incorporated by
         reference to exhibit 4(f) to the registrant's report on Form
         10-Q for the quarterly period ended September 30, 2000 (the
         "Third Quarter 2000 Form 10-Q").

 4(g)    Indenture dated as of June 16, 1997, between the registrant
         and The Bank of Nova Scotia Trust Company of New York,
         incorporated by reference to Exhibit 4(a) to the
         registrant's report on Form 8-K dated June 18, 1997.

10(a)    Sixth Voting Agreement dated April 22, 1978, between Central
         Canada Potash, Division of Noranda, Inc., Cominco Ltd.,
         International Minerals and Chemical Corporation (Canada)
         Limited, PCS Sales and Texasgulf Inc., incorporated by
         reference to Exhibit 10(f) to the F-1 Registration
         Statement.

10(b)    Canpotex Limited Shareholders Seventh Memorandum of
         Agreement effective April 21, 1978, between Central Canada
         Potash, Division of Noranda Inc., Cominco Ltd.,
         International Minerals and Chemical Corporation (Canada)
         Limited, PCS Sales, Texasgulf Inc. and Canpotex Limited as
         amended by Canpotex S & P amending agreement dated November
         4, 1987, incorporated by reference to Exhibit 10(g) to the
         F-1 Registration Statement.

10(c)    Producer Agreement dated April 21, 1978, between Canpotex
         Limited and PCS Sales, incorporated by reference to Exhibit
         10(h) to the F-1 Registration Statement.

10(d)    Canpotex/PCS Amending Agreement, dated with effect October
         1, 1992, incorporated by reference to Exhibit 10(f) to the
         1995 Form 10-K.

10(e)    Canpotex PCA Collateral Withdrawing/PCS Amending Agreement,
         dated with effect October 7, 1993, incorporated by reference
         to Exhibit 10(g) to the 1995 Form 10-K.

10(f)    Canpotex Producer Agreement amending agreement dated
         effective January 1, 1999.
</TABLE>
<PAGE>   35

<TABLE>
<CAPTION>
EXHIBIT
NUMBER                          EXHIBIT INDEX
-------                         -------------
<C>      <S>
10(g)    Agreement of Limited Partnership of Arcadian Fertilizer,
         L.P. dated as of March 3, 1992 (form), and the related
         Certificate of Limited Partnership of Arcadian Fertilizer,
         L.P., filed with the Secretary of State of the State of
         Delaware on March 3, 1992 (incorporated by reference to
         Exhibits 3.1 and 3.2 to Arcadian Partners L.P.'s
         Registration Statement on Form S-1 (File No. 33-45828)).

10(h)    Amendment to Agreement of Limited Partnership of Arcadian
         Fertilizer, L.P. and related Certificates of Limited
         Partnership of Arcadian Fertilizer, L.P. filed with the
         Secretary of State of the State of Delaware on March 6, 1997
         and November 26, 1997, incorporated by reference to Exhibit
         10(f) to the registrant's report on Form 10-K for the year
         ended December 31, 1998 (the "1998 Form 10-K").

10(i)    Geismar Complex Services Agreement dated June 4, 1984,
         between Honeywell International, Inc. and Arcadian
         Corporation, incorporated by reference to Exhibit 10.4 to
         Arcadian Corporation's Registration Statement on Form S-1
         (File No. 33-34357).

10(j)    Esterhazy Restated Mining and Processing Agreement dated
         January 31, 1978, between International Minerals and
         Chemical Corporation (Canada) Limited and the registrant's
         predecessor, incorporated by reference to Exhibit 10(e) to
         the F-1 Registration Statement.

10(k)    Agreement dated December 21, 1990, between International
         Minerals & Chemical Corporation (Canada) Limited and the
         registrant, amending the Esterhazy Restated Mining and
         Processing Agreement dated January 31, 1978, incorporated by
         reference to Exhibit 10(p) to the registrant's report on
         Form 10-K for the year ended December 31, 1990.

10(l)    Agreement effective August 27, 1998, between International
         Minerals & Chemical (Canada) Global Limited and the
         registrant, amending the Esterhazy Restated Mining and
         Processing Agreement dated January 31, 1978 (as amended),
         incorporated by reference to Exhibit 10(l) to the 1998 Form
         10-K.

10(m)    Agreement effective August 31, 1998, among International
         Minerals & Chemical (Canada) Global Limited, International
         Minerals & Chemical (Canada) Limited Partnership and the
         registrant assigning the interest in the Esterhazy Restated
         Mining and Processing Agreement dated January 31, 1978 (as
         amended) held by International Minerals & Chemical (Canada)
         Global Limited to International Minerals & Chemical (Canada)
         Limited Partnership, incorporated by reference to Exhibit
         10(m) to the 1998 Form 10-K.

10(n)    Operating Agreement dated May 11, 1993, between BP Chemicals
         Inc. and Arcadian Ohio, L.P., as amended by the First
         Amendment to the Operating Agreement dated as of November
         20, 1995, between BP Chemicals Inc. and Arcadian Ohio, L.P.
         ("First Amendment"), incorporated by reference to Exhibit
         10.2 to Arcadian Partners L.P.'s current report on Form 8-K
         for the report event dated May 11, 1993, except for the
         First Amendment which is incorporated by reference to
         Arcadian Corporation's report on Form 10-K for the year
         ended December 31, 1995.

10(o)    Second Amendment to Operating Agreement between BP
         Chemicals, Inc. and Arcadian Ohio, L.P., dated as of
         November 25, 1996, incorporated by reference to Exhibit
         10(k) to the 1997 Form 10-K.

10(p)    Manufacturing Support Agreement dated May 11, 1993, between
         BP Chemicals Inc. and Arcadian Ohio, L.P., incorporated by
         reference to Exhibit 10.3 to Arcadian Partners L.P.'s
         current report on Form 8-K for the report event dated May
         11, 1993.

10(q)    First Amendment to Manufacturing Support Agreement between
         BP Chemicals, Inc. and Arcadian Ohio, L.P., dated as of
         November 25, 1996, incorporated by reference to Exhibit
         10(l) to the 1997 Form 10-K.

10(r)    Amended and Restated Agreement for Lease dated as of May 16,
         1997, between Trinidad Ammonia Company, Limited Partnership,
         and PCS Nitrogen Fertilizer, L.P., incorporated by reference
         to Exhibit 10(n) to the registrant's report on Form 10-Q for
         the quarterly period ended June 30, 1997 (the "Second
         Quarter 1997 Form 10-Q").
</TABLE>
<PAGE>   36

<TABLE>
<CAPTION>
EXHIBIT
NUMBER                          EXHIBIT INDEX
-------                         -------------
<C>      <S>
10(s)    Amended and Restated Lease Agreement dated as of May 16,
         1997, between Trinidad Ammonia Company, Limited Partnership,
         and PCS Nitrogen Fertilizer, L.P., incorporated by reference
         to Exhibit 10(o) to the Second Quarter 1997 Form 10-Q.

10(t)    Amended and Restated Agreement for Lease dated as of May 16,
         1997, between Nitrogen Leasing Company, Limited Partnership,
         and PCS Nitrogen Fertilizer, L.P., incorporated by reference
         to Exhibit 10(p) to the Second Quarter 1997 Form 10-Q.

10(u)    Amended and Restated Lease Agreement dated as of May 16,
         1997, between Nitrogen Leasing Company, Limited Partnership,
         and PCS Nitrogen Fertilizer, L.P., incorporated by reference
         to Exhibit 10(q) to the Second Quarter 1997 Form 10-Q.

10(v)    Amended and Restated Purchase Option Agreement dated as of
         May 16, 1997, between Nitrogen Leasing Company, Limited
         Partnership, and PCS Nitrogen Fertilizer Operations, Inc.,
         incorporated by reference to Exhibit 10(r) to the Second
         Quarter 1997 Form 10-Q.

10(w)    Amended and Restated Purchase Option Agreement dated as of
         May 16, 1997, between Trinidad Ammonia Company, Limited
         Partnership and PCS Nitrogen Fertilizer Operations, Inc.,
         incorporated by reference to Exhibit 10(s) to the Second
         Quarter 1997 Form 10-Q.

10(x)    Agreement dated January 1, 1997 between the registrant and
         Charles E. Childers, incorporated by reference to Exhibit
         10(s) to the 1997 Form 10-K.

10(y)    Termination Agreement between the registrant and C.E.
         Childers dated November 21, 2000.

10(z)    Potash Corporation of Saskatchewan Inc. Stock Option Plan --
         Directors, as amended November 3, 1999, incorporated by
         reference to Exhibit 10(y) to the Third Quarter 1999 Form
         10-Q.

10(aa)   Potash Corporation of Saskatchewan Inc. Stock Option Plan --
         Officers and Employees, as amended January 23, 2001.

10(bb)   Short-Term Incentive Plan of the registrant effective
         January 2000, incorporated by reference to Exhibit 10(z) to
         the registrant's report on Form 10Q for the quarterly period
         ended March 31, 2000 (the "First Quarter 2000 Form 10-Q").

10(cc)   Long-Term Incentive Plan of the registrant effective January
         2000, incorporated by reference to Exhibit 10(aa) to the
         Second Quarter 2000 Form 10-Q.

10(dd)   Resolution and Forms of Agreement for Supplemental
         Retirement Income Plan, for officers and key employees of
         the registrant, incorporated by reference to Exhibit 10(o)
         to the 1995 Form 10-K.

10(ee)   Amending Resolution and revised forms of agreement regarding
         Supplemental Retirement Income Plan of the registrant,
         incorporated by reference to Exhibit 10(x) to the
         registrant's report on Form 10-Q for the quarterly period
         ended June 30, 1996.

10(ff)   Amended and restated Supplemental Retirement Income Plan of
         the registrant and text of amendment to existing
         supplemental income plan agreements, incorporated by
         reference to Exhibit (mm) to the Third Quarter 2000 Form
         10-Q.

10(gg)   Forms of Agreement dated December 30, 1994, between the
         registrant and certain officers of the registrant,
         concerning a change in control of the registrant,
         incorporated by reference to Exhibit 10(p) to the 1995 Form
         10-K.

10(hh)   Form of Agreement of Indemnification dated August 8, 1995,
         between the registrant and certain officers and directors of
         the registrant, incorporated by reference to Exhibit 10(q)
         to the 1995 Form 10-K.

10(ii)   Resolution and Form of Agreement of Indemnification dated
         January 24, 2001.

10(jj)   Chief Executive Officer Medical and Dental Plan.

10(kk)   Second Amended and Restated Membership Agreement dated
         January 1, 1995, among Phosphate Chemicals Export
         Association, Inc. and members of such association, including
         Texasgulf Inc., incorporated by reference to Exhibit 10(t)
         to the 1995 Form 10-K.
</TABLE>
<PAGE>   37

<TABLE>
<CAPTION>
EXHIBIT
NUMBER                          EXHIBIT INDEX
-------                         -------------
<C>      <S>
10(ll)   International Agency Agreement dated January 1, 1995,
         between Phosphate Chemicals Export Association, Inc. and
         Texasgulf Inc. establishing Texasgulf Inc. as exclusive
         marketing agent for such association's wet phosphatic
         materials, incorporated by reference to Exhibit 10(u) to the
         1995 Form 10-K.
10(mm)   Royalty Agreement dated October 7, 1993, by and between the
         registrant and Rio Algom Limited, incorporated by reference
         to Exhibit 10(x) to the 1995 Form 10-K.
10(nn)   Shareholder Rights Agreement as amended and restated on
         March 2, 1998, incorporated by reference to Schedule B to
         the registrant's proxy circular for the annual and special
         meeting of shareholders held on May 7, 1998.
  11     Statement re Computation of Per Share Earnings
  13     2000 Annual Report
  21     Subsidiaries of the Registrant
  23     Consent of Deloitte & Touche LLP
  99     2001 Notice of Meeting, Proxy Circular and Form of Proxy
</TABLE>