exv10wx



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	 	Exhibit 10(x)
	 
	 	 
	

	 	Adopted March 15, 2000
	

	 	Amended March 10, 2005
	 
	 	 
	

	 	Short-Term

Incentive Plan

	 
	 	 
	

	 	Effective
January 1, 2000

	 
	 	 
	

	 	Potash
Corporation of Saskatchewan Inc.







 









Table of Contents














Contents










	 	 	 	 	 
	Section 1—Establishment of the Plan
	 	 	1	 
	1.01     Purpose
	 	 	1	 
	1.02     Effective Date
	 	 	1	 
	Section 2—Definitions
	 	 	1	 
	2.01     Adjusted Cash Flow Return (ACFR)
	 	 	1	 
	2.02     Average Accumulated Amortization
	 	 	1	 
	2.03     Average Accumulated Depreciation
	 	 	2	 
	2.04     Average Assets
	 	 	2	 
	2.05     Average Non-Interest Bearing Current Liabilities
	 	 	2	 
	2.06     Award Payment
	 	 	2	 
	2.07     Award Percentage
	 	 	3	 
	2.08     Board
	 	 	3	 
	2.09     Cash Flow Return (CFR)
	 	 	3	 
	2.10     Cash Taxes
	 	 	3	 
	2.11     CEO
	 	 	3	 
	2.12     Committee
	 	 	3	 
	2.13     Corporation
	 	 	3	 
	2.14     Depreciation and Amortization
	 	 	4	 
	2.15     Eligible Employee
	 	 	4	 
	2.16     Entitled Employee
	 	 	4	 
	2.17     Operating Income
	 	 	4	 
	2.18     PCS Inc.
	 	 	4	 
	2.19     Plan
	 	 	4	 
	2.20     Salary
	 	 	4	 
	2.21     Target CFR
	 	 	4	 
	2.22     Target Percentage
	 	 	4	 
	2.23     Year
	 	 	4	 
	Section 3—Participation
	 	 	5	 
	3.01     Participation Requirements
	 	 	5	 
	Section 4—Award Payments
	 	 	5	 
	4.01     Eligibility
	 	 	5	 
	4.02     Calculation of Award Payment
	 	 	5	 
	4.03     Entitled Operations Employees
	 	 	5	 
	4.04     Limitation of Award Payments and General Discretion
	 	 	6	 
	4.05     Timing of Award Payments
	 	 	6	 
	Section 5—Administration of the Plan
	 	 	6	 
	5.01     Administration
	 	 	6	 
	Section 6—Transfer of Employment
	 	 	7	 
	6.01     Transfer of Employment
	 	 	7	 









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	Section 7—General Provisions
	 	 	7	 
	7.01     Assignment or Alienation
	 	 	7	 
	7.02     Amendment or Termination
	 	 	7	 
	7.03     Effect of Amendment or Termination
	 	 	7	 
	7.04     No Enlargement of Contractual Rights
	 	 	8	 
	7.05     Interpretation
	 	 	8	 
	7.06     Withholding of Taxes
	 	 	8	 
	7.07     Binding on Successors
	 	 	8	 
	7.08     Currency
	 	 	8	 
	Appendix “A”—Award Percentage
	 	 	9	 














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Section 1—Establishment of the Plan















	1.01  	Purpose





	   	This Annual Incentive Plan is established for the purpose of rewarding key employees
on an annual basis for their efforts and contributions in the attainment of certain
performance measures that contribute materially to the success of the business interests of
Potash Corporation of Saskatchewan Inc.









	1.02  	Effective Date





	   	Subject to Section 7.02 (Amendment or Termination), this Plan shall be effective on
and after January 1, 2000.




 







Section 2—Definitions








The following terms, when capitalized, shall be defined as follows:









	2.01  	Adjusted Cash Flow Return (ACFR)




	   	“Adjusted Cash Flow Return” or “ACFR” means an amount derived from the following
formula:






	   	ACFR = (CFR divided by Target CFR) multiplied by 100,






	   	and used in the table at Appendix “A” to calculate an Entitled Employee’s Award Percentage
for a given Year.










	2.02  	Average Accumulated Amortization





	   	“Average Accumulated Amortization” means the average consolidated accumulated
amortization of PCS Inc. during a given Year, calculated by dividing (a) by (b) where:






	 	(a)  	equals the sum of the consolidated accumulated amortization of
PCS Inc. at the beginning of the Year, the consolidated accumulated
amortization of PCS Inc. at the beginning of the second quarter of the Year,
the consolidated accumulated amortization of PCS Inc. at the beginning of the
third quarter of the Year, the consolidated accumulated amortization of PCS
Inc. at the beginning of the fourth quarter of the Year and the consolidated
accumulated amortization of PCS Inc. at the end of the Year; and,






	 	(b)  	equals five (5).











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	2.03  	Average Accumulated Depreciation





	   	“Average Accumulated Depreciation” means the average consolidated accumulated
depreciation of PCS Inc. during a given Year, calculated by dividing (a) by (b) where:






	 	(a)  	equals the sum of consolidated accumulated depreciation of PCS
Inc. at the beginning of the Year, consolidated accumulated depreciation of PCS
Inc. at the beginning of the second quarter of the Year, the consolidated
accumulated depreciation of PCS Inc. at the beginning of the third quarter of
the Year, the consolidated accumulated depreciation of PCS Inc. at the
beginning of the fourth quarter of the Year and the consolidated accumulated
depreciation of PCS Inc. at the end of the Year; and,






	 	(b)  	equals five (5).










	2.04  	Average Assets





	   	“Average Assets” means the average book value of PCS Inc.’s consolidated assets
during a given Year, calculated by dividing (a) by (b) where:






	 	(a)  	equals the sum of the book value of the consolidated assets of
PCS Inc. at the beginning of the Year, the book value of the consolidated
assets of PCS Inc. at the beginning of the second quarter of the Year, the book
value of the consolidated assets of PCS Inc. at the beginning of the third
quarter of the Year, the book value of the consolidated assets of PCS Inc. at
the beginning of the fourth quarter of the Year and the book value of the
consolidated assets of PCS Inc. at the end of the Year; and,






	 	(b)  	equals five (5).










	2.05  	Average Non-Interest Bearing Current Liabilities





	   	“Average Non-Interest Bearing Current Liabilities” means the average consolidated
non-interest bearing current liabilities of PCS Inc. during a given Year, calculated by
dividing (a) by (b) where:






	 	(a)  	equals the sum of the consolidated non-interest bearing current
liabilities of PCS Inc. at the beginning of the Year, the consolidated
non-interest bearing current liabilities of PCS Inc. at the beginning of the
second quarter of the Year, the consolidated non-interest bearing current
liabilities of PCS Inc. at the beginning of the third quarter of the Year, the
consolidated non-interest bearing current liabilities of PCS Inc. at the
beginning of the fourth quarter of the Year and the consolidated non-interest
bearing current liabilities of PCS Inc. at the end of the Year; and,






	 	(b)  	equals five (5).










	2.06  	Award Payment





	   	“Award Payment” means a cash payment to an Entitled Employee calculated pursuant to
Section 4 (Award Payments).











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	2.07  	Award Percentage





	   	“Award Percentage” means the percentage of an Entitled Employee’s Salary derived from
the table contained in Appendix “A”. The Award Percentages applicable to an Entitled
Employee, as set out in the table in Appendix “A”, shall be recommended by the CEO and
approved by the Committee.










	2.08  	Board





	   	“Board” means the Board of Directors of PCS Inc.










	2.09  	Cash Flow Return (CFR)





	   	“Cash Flow Return” or “CFR” means the amount derived from the following formula:






	 	(a)  	Operating Income, plus






	 	   	Depreciation and Amortization, minus






	 	   	Cash Taxes





DIVIDED BY





	 	(b)  	Average Assets, plus






	 	   	Average Accumulated Depreciation, plus






	 	   	Average Accumulated Amortization, minus






	 	   	Average Non-Interest Bearing Current Liabilities,






	   	and used in the table at Appendix “A” to calculate an Entitled Employee’s Award Percentage
for a given Year.










	2.10  	Cash Taxes





	   	“Cash Taxes” means the cash income tax expense for a given Year, as set out in the
audited consolidated financial statements of PCS Inc. for that Year.










	2.11  	CEO





	   	“CEO” means the Chief Executive Officer of PCS Inc.










	2.12  	Committee





	   	“Committee” means the Compensation Committee of the Board.










	2.13  	Corporation





	   	“Corporation” means Potash Corporation of Saskatchewan Inc. and its direct and
indirect subsidiaries.











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	2.14  	Depreciation and Amortization





	   	“Depreciation and Amortization” means the depreciation and amortization expense for a
given Year, as set out in the audited consolidated financial statements of PCS Inc. for that
Year.










	2.15  	Eligible Employee





	   	“Eligible Employee” means an employee who has satisfied the eligibility requirements
set out in Section 4.01 (Eligibility).










	2.16  	Entitled Employee





	   	“Entitled Employee” means an Eligible Employee who is recommended by the CEO and
approved by the Committee to participate in this Plan.






	 	(a)  	Entitled Operations Employee





	 	   	“Entitled Operations Employee” means an Entitled Employee who is attached to one of
the operating facilities of PCS Inc. or its direct or indirect subsidiaries.










	2.17  	Operating Income





	   	“Operating Income” means the operating income for a given Year, as set out in the
audited consolidated financial statements of PCS Inc. for that Year.










	2.18  	PCS Inc.





	   	“PCS Inc.” means Potash Corporation of Saskatchewan Inc.










	2.19  	Plan





	   	“Plan” means this Annual Incentive Plan, as amended from time to time.










	2.20  	Salary





	   	“Salary” means the annual base salary in effect for an Entitled Employee at the end
of a given Year.










	2.21  	Target CFR





	   	“Target CFR” means the CFR projected in the annual budget approved by the Board and
used in the table at Appendix “A” to calculate an Entitled Employee’s Award Percentage for a
given Year.










	2.22  	Target Percentage





	   	“Target Percentage” means the Award Percentage of an Entitled Employee when CFR
equals Target CFR, as shown in the table contained in Appendix “A”.










	2.23  	Year





	   	“Year” means the fiscal year of PCS Inc.











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Section 3—Participation















	3.01  	Participation Requirements





	   	Participation in the Plan is limited to Eligible Employees.



 







Section 4—Award Payments














	4.01  	Eligibility





	   	An employee of the Corporation who is employed for at least three months during a
Year, and who is in the employ of the Corporation at the end of a Year shall become an
Eligible Employee.









	4.02  	Calculation of Award Payment





	   	Subject to Section 4.04 (Limitation of Award Payments and General Discretion), an
Entitled Employee, other than Entitled Operations Employees, shall receive an Award Payment
equal to the Entitled Employee’s Award Percentage multiplied by his or her Salary.






	   	The Award Payment calculated in accordance with this Section 4.02 is subject to an
adjustment of plus or minus 20% depending upon the Entitled Employee’s job performance, as
determined by his or her supervisor, and approved in accordance with the provisions of this
Plan.










	4.03  	Entitled Operations Employees





	   	Subject to Section 4.04 (Limitation of Award Payments and General Discretion), an
Entitled Operations Employee shall be entitled to an Award Payment equal to the sum of
paragraphs (a) and (b) below:






	 	(a)  	the award calculated pursuant to Section 4.02 (Calculation of Award Payment),
divided by two (2); and,






	 	(b)  	an amount equal to the Target Percentage of the Salary of the Entitled
Operations Employee, adjusted by applying a formula to be developed from time to time
by the CEO in consultation with the Senior Vice-President, Administration and the
appropriate subsidiary President which formula shall reasonably reflect the actual
results of the operating facility to which the employee is attached compared to the
approved target for that operating facility, and thereafter dividing such amount by two
(2).











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	4.04  	Limitation of Award Payments and General Discretion





	 	(a)  	Generally, no Award Payment shall be granted under this Plan with respect to any
Year in which the CFR is less than 50% of the Target CFR. However, the Committee may
elect, in its discretion, to grant Award Payments in any Year, regardless of the CFR.






	 	(b)  	The Award Payment for any Entitled Employee may exceed or be below the amount
calculated in accordance with this Section 4. Award Payments falling outside the
established range shall be recommended by the CEO and shall be approved by the
Committee in the normal course of administering this Plan.






	 	(c)  	An Entitled Employee who has been employed by the Corporation for less than one
year shall have his or her Award Payment prorated in accordance with his or her period
of employment.






	 	(d)  	An Entitled Employee who was, during a Year, promoted to a position included in
a Group set forth in Appendix “A”, shall have his or her Award Payment prorated in
accordance with the period of time he or she held such position.






	 	(e)  	An Entitled Employee who was, during a Year, promoted from one Group to another
Group set forth in Appendix “A”, shall have his or her Award Payment calculated on the
basis of his or her Group as at the end of the Year.






	 	(f)  	Notwithstanding the Groups established in Appendix “A”, the Committee may on
the recommendation of the CEO, designate an Eligible Employee for inclusion in one of
such Groups when, but for such designation, the Eligible Employee would not otherwise
be included in such Group.










	4.05  	Timing of Award Payments





	   	The Committee shall, on the recommendation of the CEO and within 30 days of the end
of a Year, approve the amount of Award Payments for each Entitled Employee for any given
Year. The Award Payments shall be paid to Entitled Employees within 30 days of the approval
thereof by the Committee.




 







Section 5—Administration of the Plan















	5.01  	Administration





	   	The Committee shall conclusively interpret the provisions of this Plan and decide all
questions of fact arising in the application of the Plan. Determinations and interpretations
in individual cases may be made by the CEO with due regard to consistency with any prior
action by the Committee and such determination shall be binding and conclusive upon the
individual employees concerned and persons claiming under them. The Committee shall be
advised of any such determination or interpretation made by the CEO.










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Section 6—Transfer of Employment













	6.01  	Transfer of Employment





	   	If an Entitled Employee’s employment is transferred, during a Year, within the
Corporation the Senior Vice-President, Administration and the CEO shall determine whether
the Entitled Employee’s Award Payment is calculated in accordance with Section 4.02
(Calculation of Award Payment), Section 4.03 (Entitled Operations Employees), or a
combination of those sections.



 







Section 7—General Provisions















	7.01  	Assignment or Alienation





	   	Except as required by applicable laws, the right of an Entitled Employee to receive
an Award Payment under this Plan shall not be:





	 	(a)  	given as security;






	 	(b)  	subject to transfer, anticipation, commutation, alienation, sale, assignment,
encumbrance, charge, pledge, or hypothecation; or






	 	(c)  	subject to execution, attachment, levy or similar process or assignment by
operation of law,






	   	and any attempt to effect any such action shall be null and void and of no effect.










	7.02  	Amendment or Termination





	   	Subject to Section 7.03 (Effect of Amendment or Termination), this Plan may be
amended in whole or in part from time to time or terminated by the Corporation. Any
amendment or termination shall be binding on the Corporation, Entitled Employees, Eligible
Employees and their respective beneficiaries.










	7.03  	Effect of Amendment or Termination





	   	Notwithstanding Section 7.02 (Amendment or Termination), no amendment or termination
of any provision of this Plan shall directly or indirectly deprive any Entitled Employee or
beneficiary of all or any portion of an Award Payment earned with respect to any Year ending
prior to the date of the amendment or termination.











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	7.04  	No Enlargement of Contractual Rights





	   	This Plan shall not give any Entitled Employee or Eligible Employee the right to be
retained in the service of the Corporation nor shall it interfere with the right of the
Corporation to terminate the employment of the Entitled Employee or Eligible Employee.
Participation in this Plan shall not give any Entitled Employee or Eligible Employee any
right or claim to any benefit, except to the extent provided in this Plan.










	7.05  	Interpretation





	   	This Plan shall be interpreted pursuant to the laws of the Province of Saskatchewan.
Section headings are for convenience only and shall not be considered provisions of the
Plan. Words in the singular shall include the plural, and vice versa, unless qualified by
the context.










	7.06  	Withholding of Taxes





	   	The Corporation shall withhold all applicable taxes from any amounts paid pursuant to
this Plan.










	7.07  	Binding on Successors





	   	This Plan shall be binding on any successor or successors of PCS Inc. whether by
merger, consolidation or otherwise.










	7.08  	Currency





	   	The benefits payable pursuant to this Plan shall be paid in the same currency as the
Entitled Employee receives his or her Salary.











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Appendix “A”—Award Percentage




 


	 	 	 	 	 	 	 	 	 	 	 
	Tier	 	Group	 	Award	 	Award	 	Award
	 	 	 	 	Percentage	 	Percentage	 	Percentage at
	 	 	 	 	When CFR is	 	When CFR	 	Maximum CFR
	 	 	 	 	Less Than	 	Equals or is	 	(150% of Target
	 	 	 	 	Target CFR	 	Greater Than	 	CFR)
	 	 	 	 	 	 	Target CFR	 	 
	 
	 
	 
	I
	 	Corporate President,
and CEO

	 	100% multiplied

by ACFR
	 	(200% multiplied

by ACFR) minus 100%
	 	 	200	%
	 
	 	 
	 	 	 	 	 	 	 	 
	IA
	 	Executive VP and COO, SVP and CFO

	 	70% multiplied by

ACFR
	 	(140% multiplied by

ACFR) minus 70%
	 	 	140	%
	 
	 	 
	 	 	 	 	 	 	 	 
	II
	 	Sr. VP Admin, Sr. VP Corporate
Relations, and Subsidiary
Presidents

	 	55% multiplied

by ACFR
	 	(110% multiplied

by ACFR) minus 55%
	 	 	110	%
	 
	 	 
	 	 	 	 	 	 	 	 
	IIA
	 	Sr. VP IT; Selected Corporate
and Sales VP’s (Audit,
Controller, Procurement, General
Counsel, Int’l Sales, T&D) and
GM Arab Potash

	 	40% multiplied by

ACFR
	 	(80% multiplied by

ACFR) minus 40%
	 	 	80	%
	 
	 	 
	 	 	 	 	 	 	 	 
	III
	 	Selected Corporate VP’s (SHE;
Technical Support) and Sales
VP’s (Industrial Sales/Trinidad
Ammonia)

	 	35% multiplied

by ACFR
	 	(70% multiplied

by ACFR) minus 35%
	 	 	70	%
	 
	 	 
	 	 	 	 	 	 	 	 
	IV
	 	Selected GM’s (Aurora, WS and
Trinidad); Technical Deputy GM,
APC; Finance Deputy GM, APC;
Selected Corporate and Sales
VP’s; Associate General Counsel

	 	30% multiplied

by ACFR
	 	(60% multiplied

by ACFR) minus 30%
	 	 	60	%
	 
	 	 
	 	 	 	 	 	 	 	 
	V
	 	General Managers Potash,
Selected VPs; Technical
Managers; Senior Counsel; Plant
Managers (Augusta, FFF, Geismar,
Lima); Sr. Directors

	 	25% multiplied

by ACFR
	 	(50% multiplied

by ACFR) minus 25%
	 	 	50	%
	 
	 	 
	 	 	 	 	 	 	 	 
	VI
	 	Corporate Directors, Plant
Managers (Marseilles, Joplin,
Weeping Water); Selected
Managers

	 	20% multiplied

by ACFR
	 	(40% multiplied

by ACFR) minus 20%
	 	 	40	%
	 
	 	 
	 	 	 	 	 	 	 	 
	VII
	 	Selected Key Managers (775 + Hay

Points)

	 	15% multiplied

by ACFR
	 	(30% multiplied

by ACFR) minus 15%
	 	 	30	%













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Notes:





	1.  	Where the ACFR is greater than 150 (i.e. the maximum CFR), the ACFR is deemed to be 150.






	2.  	Subject to Section 4.04 (Limitation of Award Payments and General Discretion) where the CFR
is less than 50, the ACFR is deemed to be zero (0).









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