UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 10)*
Sociedad Química y Minera de Chile S.A.
(Name of Issuer)
Series A Common Stock, no par value (“Series A Shares”)
Series B Common Stock, no par value (“Series B Shares”)
(Title of Class of Securities)
Series A Shares: 833636103
Series B Shares: 833635105
(CUSIP Number)
Wayne R. Brownlee
Executive Vice President, Treasurer and Chief Financial Officer
Potash Corporation of Saskatchewan Inc.
Suite 500, 122 – 1st Avenue South
Saskatoon, Saskatchewan
Canada S7K 7G3
(306) 933-8500
with a copy to
Robert A. Profusek
Jones Day
250 Vesey Street
New York, New York 10281-1047
(212) 326-3939
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)
April 17, 2017
(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. ☐
Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.
| * | The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. |
The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
| CUSIP No. 833635105 / 833636103 | (Page 2 of 9) |
| 1 | NAMES OF REPORTING PERSONS:
Potash Corporation of Saskatchewan Inc.
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):
| |||||
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS): (a) ☐ (b) ☐
| |||||
| 3 | SEC USE ONLY:
| |||||
| 4 | SOURCE OF FUNDS (SEE INSTRUCTIONS):
Series A Shares: Not Applicable Series B Shares: AF, WC | |||||
| 5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): ☐
| |||||
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION:
Saskatchewan, Canada | |||||
| NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7 | SOLE VOTING POWER:
- 0 - Series A Shares (See Item 5) - 0 - Series B Shares (See Item 5) | ||||
| 8 | SHARED VOTING POWER:
64,056,568 Series A Shares (See Item 5) 20,166,319 Series B Shares (See Item 5) | |||||
| 9 | SOLE DISPOSITIVE POWER:
- 0 - Series A Shares (See Item 5) - 0 - Series B Shares (See Item 5) | |||||
| 10 | SHARED DISPOSITIVE POWER:
64,056,568 Series A Shares (See Item 5) 20,166,319 Series B Shares (See Item 5) | |||||
| 11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
64,056,568 Series A Shares (See Item 5) 20,166,319 Series B Shares (See Item 5) | |||||
| 12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS): ☐
| |||||
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
44.85% of Series A Shares (See Item 5(a)) 16.75% of Series B Shares (see Item 5(a)) | |||||
| 14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):
CO | |||||
| CUSIP No. 833635105 / 833636103 | (Page 3 of 9) |
| 1 | NAMES OF REPORTING PERSONS:
Inversiones PCS Chile Limitada
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):
| |||||
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS): (a) ☐ (b) ☐
| |||||
| 3 | SEC USE ONLY:
| |||||
| 4 | SOURCE OF FUNDS (SEE INSTRUCTIONS):
Series A Shares: Not Applicable Series B Shares: AF | |||||
| 5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): ☐
| |||||
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION:
Delaware | |||||
| NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7 | SOLE VOTING POWER:
- 0 - Series A Shares (See Item 5) - 0 - Series B Shares (See Item 5) | ||||
| 8 | SHARED VOTING POWER:
15,526,000 Series A Shares (See Item 5) - 0 - Series B Shares (See Item 5) | |||||
| 9 | SOLE DISPOSITIVE POWER:
- 0 - Series A Shares (See Item 5) - 0 - Series B Shares (See Item 5) | |||||
| 10 | SHARED DISPOSITIVE POWER:
15,526,000 Series A Shares (See Item 5) - 0 - Series B Shares (See Item 5) | |||||
| 11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
15,526,000 Series A Shares (See Item 5) - 0 - Series B Shares (See Item 5) | |||||
| 12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS): ☐
| |||||
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
10.87% of Series A Shares (See Item 5(a)) 0% of Series B Shares (See Item 5(a)) | |||||
| 14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):
OO | |||||
| CUSIP No. 833635105 / 833636103 | (Page 4 of 9) |
| 1 | NAMES OF REPORTING PERSONS:
Inversiones El Boldo Limitada
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):
| |||||
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS): (a) ☐ (b) ☐
| |||||
| 3 | SEC USE ONLY:
| |||||
| 4 | SOURCE OF FUNDS (SEE INSTRUCTIONS):
Series A Shares: Not Applicable Series B Shares: AF | |||||
| 5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): ☐
| |||||
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION:
Republic of Chile | |||||
| NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7 | SOLE VOTING POWER:
- 0 - Series A Shares (See Item 5) - 0 - Series B Shares (See Item 5) | ||||
| 8 | SHARED VOTING POWER:
29,330,326 Series A Shares (See Item 5) 17,963,546 Series B Shares (See Item 5) | |||||
| 9 | SOLE DISPOSITIVE POWER:
- 0 - Series A Shares (See Item 5) - 0 – Series B Shares (See Item 5) | |||||
| 10 | SHARED DISPOSITIVE POWER:
29,330,326 Series A Shares (See Item 5) 17,963,546 Series B Shares (See Item 5) | |||||
| 11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
29,330,326 Series A Shares (See Item 5) 17,963,546 Series B Shares (See Item 5) | |||||
| 12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS): ☐
| |||||
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
20.54% of Series A Shares (See Item 5(a)) 14.92% of Series B Shares (See Item 5(a)) | |||||
| 14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):
OO | |||||
| CUSIP No. 833635105 / 833636103 | (Page 5 of 9) |
| 1 | NAMES OF REPORTING PERSONS:
Inversiones RAC Chile Limitada
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):
| |||||
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS): (a) ☐ (b) ☐
| |||||
| 3 | SEC USE ONLY:
| |||||
| 4 | SOURCE OF FUNDS (SEE INSTRUCTIONS):
Series A Shares: Not Applicable Series B Shares: Not Applicable | |||||
| 5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): ☐
| |||||
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION:
Republic of Chile | |||||
| NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7 | SOLE VOTING POWER:
- 0 - Series A Shares (See Item 5) - 0 - Series B Shares (See Item 5) | ||||
| 8 | SHARED VOTING POWER:
19,200,242 Series A Shares (See Item 5) 2,202,773 Series B Shares (See Item 5) | |||||
| 9 | SOLE DISPOSITIVE POWER:
- 0 - Series A Shares (See Item 5) - 0 - Series B Shares (See Item 5) | |||||
| 10 | SHARED DISPOSITIVE POWER:
19,200,242 Series A Shares (See Item 5) 2,202,773 Series B Shares (See Item 5) | |||||
| 11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
19,200,242 Series A Shares (See Item 5) 2,202,773 Series B Shares (See Item 5) | |||||
| 12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS): ☐
| |||||
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
13.44% of Series A Shares (See Item 5(a)) 1.83% of Series B Shares (See Item 5(a)) | |||||
| 14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):
OO | |||||
| CUSIP No. 833635105 / 833636103 | Schedule 13D |
Item 1. Security and Issuer.
This Amendment No. 10 amends the Schedule 13D, dated November 2, 2001, as amended (the “Schedule 13D”), of Potash Corporation of Saskatchewan Inc. (“PCS”) and the PCS affiliates listed in Item 2 with respect to Series A Shares and Series B Shares, of Sociedad Química y Minera de Chile S.A. (the “Issuer”), a company organized under the laws of the Republic of Chile. The principal executive offices of the Issuer are located at Moneda 970, Floor 15, Santiago, Chile. Capitalized terms used but not otherwise defined in this Amendment have the meanings ascribed to such terms in the Schedule 13D.
Item 2. Identity and Background.
This statement is filed pursuant to Rule 13d-2(a) under the Securities Exchange Act of 1934, as amended, by the persons listed below (the “Reporting Persons”).
(1) PCS, a corporation organized under the laws of Canada, is (together with its subsidiaries) an integrated fertilizer and related industrial and feed products company engaged in the production of potash, phosphate and nitrogen products. The principal business address of PCS is Suite 500, 122 — 1st Avenue South, Saskatoon, Saskatchewan, Canada S7K 7G3.
(2) Inversiones PCS Chile Limitada (“PCS Chile”) is a limited liability company organized under the laws of Chile principally for the purpose of acquiring and holding shares of the Issuer. Its principal business address is: Avenida Apoquindo 3721, Piso 12, comuna de Las Condes, Santiago, Chile. PCS beneficially owns the entire equity interest in PCS Chile.
(3) Inversiones El Boldo Limitada (“Chile Holdco”) is a limited liability company formed under the laws of Chile principally for the purpose of acquiring and holding shares of the Issuer. Its principal business address is Avenida Apoquindo 3721, Piso 12, comuna de Las Condes, Santiago, Chile. PCS beneficially owns the entire equity interest in Chile Holdco.
(4) Inversiones RAC Chile Limitada (“RAC”) is a limited liability company formed under the laws of Chile and was acquired by PCS principally for the purpose of acquiring and holding shares of the Issuer. Its principal address is: Avenida Apoquindo 3721, Piso 12, comuna de Las Condes, Santiago, Chile. PCS beneficially owns the entire equity interest in RAC.
None of the Reporting Persons, during the last five years, has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
No change.
Item 4. Purpose of Transaction.
No change, except that on April 17, 2017, the Reporting Persons, on the one hand, and Sociedad de Inversiones Pampa Calichera S.A., Kowa Company Ltd. and certain of their respective affiliates, on the other hand (the “Pampa Shareholders”), signed a letter agreement (the “Letter Agreement”) providing that the Pampa Shareholders would take actions available to them so long as they are shareholders such that, in the event that the member of the Board of Directors of the Issuer (the “Board”) elected by the Class B shareholders ceases to serve as such for any reason, (a) none of the Pampa Shareholders will vote any Issuer shares or take any other action that affects the election of his successor or any future successor (the “Class B Successor”) and (b) each of the Pampa Shareholders will take all actions available to it to ensure that the Board does not approve any Class B Successor whose election was not approved by majority vote of the Class B shares (excluding any shares beneficially owned by any Pampa Shareholders or as to which any Pampa Shareholder has a proxy or exercises any voting control) or by the PCS Shareholders, as the case may be. In addition, for the term of the Board elected at the 2017 annual shareholders meeting, the parties agreed that they will take all action available to them so that (1) no matter is approved by the Board unless it is affirmatively approved by at least five of the eight members of the Board and (2) the Chairman of the Board does not exercise a casting vote under the by-laws if there is a tie, but rather uses all efforts to break any tie by pursuing business with a majority of the members of the Board. The parties also agreed to support a dividend policy as set forth in Exhibit A to the Letter Agreement, which is attached as Exhibit 2 hereto and incorporated herein by reference.
(Page 6 of 9)
| CUSIP No. 833635105 / 833636103 | Schedule 13D |
Item 5. Interest in Securities of the Issuer.
(a) The Series A Shares and Series B Shares beneficially owned by each of PCS, PCS Chile, Chile Holdco and RAC are as follows:
| Number of Series A Shares |
% of Class(1) | Number of Series B Shares |
% of Class(2) | % of All Equity Securities of Issuer(3) |
||||||||||||||||
| PCS(4) |
64,056,568 | 44.85 | % | 20,166,319 | 16.75 | % | 32.00 | % | ||||||||||||
| PCS Chile |
15,526,000 | 10.87 | % | 0 | 0 | % | 5.90 | % | ||||||||||||
| Chile Holdco |
29,330,326 | 20.54 | % | 17,963,546 | 14.92 | % | 17.97 | % | ||||||||||||
| RAC |
19,200,242 | 13.44 | % | 2,202,773 | 1.83 | % | 8.13 | % | ||||||||||||
| (1) | Based upon 142,819,552 Series A Shares outstanding as of December 31, 2015 (as reported in the Issuer’s Form 20-F filed with the Commission on April 21, 2016). |
| (2) | Based upon 120,376,972 Series B Shares outstanding as of December 31, 2015 (as reported on the Issuer’s Form 20-F filed with the Commission on April 21, 2016). |
| (3) | Based upon 142,819,552 Series A Shares and 120,376,972 Series B Shares of the Issuer outstanding as of December 31, 2015. |
| (4) | PCS beneficially owns all shares owned by it, PCS Chile, Chile Holdco and RAC. |
(b) Because PCS beneficially owns the entire outstanding equity interest in PCS Chile, Chile Holdco and RAC, PCS has the power to vote or to direct the voting or to dispose or direct the disposition of all of the Series A Shares and all of the Series B Shares owned by PCS Chile, Chile Holdco and RAC. Except as otherwise disclosed herein, no person other than the Reporting Persons shares the power to vote or to direct the vote or to dispose or direct the disposition of any of the Series A Shares or the Series B Shares owned by the Reporting Persons.
(c) Not applicable.
(d) No change.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.
See description of the Letter Agreement in Item 4 above, a copy of which is attached as Exhibit 2 hereto and incorporated herein by reference.
Item 7. Material to be Filed as Exhibits.
| Exhibit 1 | Joint Filing Agreement, dated as of April 18, 2017, among Potash Corporation of Saskatchewan Inc., Inversiones PCS Chile Limitada, Inversiones RAC Chile Limitada, and Inversiones El Boldo Limitada | |
| Exhibit 2 | Letter Agreement, dated as of April 17, 2017, among the Reporting Persons and the Pampa Shareholders | |
(Page 7 of 9)
| CUSIP No. 833635105 / 833636103 | Schedule 13D |
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, the undersigned certify that the information set forth in this statement is true, complete and correct.
Dated: April 18, 2017
(Page 8 of 9)
| CUSIP No. 833635105 / 833636103 | Schedule 13D |
EXHIBIT INDEX
| Exhibit 1: | Joint Filing Agreement, dated as of April 18, 2017, among Potash Corporation of Saskatchewan Inc., Inversiones PCS Chile Limitada, Inversiones RAC Chile Limitada, and Inversiones El Boldo Limitada | |
| Exhibit 2: | Letter Agreement, dated as of April 17, 2017, among the Reporting Persons and the Pampa Shareholders | |
(Page 9 of 9)
Exhibit 1
JOINT FILING AGREEMENT
The undersigned hereby agree that the Schedule 13D with respect to the shares of Series A Common Stock, no par value, and Series B Common Stock, no par value, of Sociedad Química y Minera de Chile S.A. is, and any amendment thereto signed by each of the undersigned shall be, filed on behalf of each of the undersigned pursuant to and in accordance with the provisions of Rule 13d-1(k) promulgated under the Securities Exchange Act of 1934. The undersigned hereby further agree that this Joint Filing Agreement be included as an exhibit to such statement and any such amendment. This Joint Filing Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument.
Dated: April 18, 2017
Exhibit 2
EXECUTION COPY
April 17, 2017
Ladies and Gentlemen:
This letter agreement (“Agreement”) is entered into by the subsidiaries of Potash Corporation of Saskatchewan Inc. (“PCS”) set forth on the signature pages hereto (the “PCS Shareholders”), the entities designated on the signature pages hereto as the “Cascadas Shareholders” (the “Cascadas Shareholders”) and the entities designated on the signature pages hereto as the “Kowa Shareholders” (the “Kowa Shareholders”), each in their capacities as shareholders of Sociedad Química y Minera de Chile S.A. (“SQM”). The Cascadas Shareholders, the Kowa Shareholders and the PCS Shareholders are referred to herein as the “Parties”.
Each of the Parties agrees as follows:
| 1. | Overall Governance. The business and affairs of SQM will be managed by its management under the direction of the SQM Board, and not by the Parties. Nothing herein will limit the powers or authority of the SQM Board or management, including as to matters that are the subject matter of this Agreement, or give any of the Parties the right or power to direct the SQM Board or management to take or not to take any action. |
| 2. | Dividend Policy. Each of the Parties (a) acknowledges and agrees that the dividend policy set forth on Exhibit A (the “Dividend Policy”) is in the best interests of all shareholders of SQM and (b) will take all actions available to it to cause the SQM Board, including any applicable committee thereof, to adopt and comply with the Dividend Policy from and after the date of this Agreement for the entire term of this Agreement. |
| 3. | Casting Vote. Notwithstanding anything to the contrary in the Organizational Documents or applicable law, each of the Parties will take all actions available to it to cause SQM to ensure that (a) no matter is approved by the Board of Directors of SQM (the “SQM Board”) unless it is affirmatively approved by at least five of the members of the SQM Board and (b) the Chairman of the SQM Board does not exercise a casting vote. Any of the Cascadas Shareholders, the Kowa Shareholders or the PCS Shareholders may terminate the foregoing provisions upon 30 days’ prior written notice after the expiration of the SQM Board Term. For purposes of this Agreement, (1) the “SQM Board Term” means the period in which the SQM Board, as elected at SQM’s 2017 annual meeting of shareholders, with the replacements, if any, that the SQM Board may appoint from time to time, serves as such until election by SQM shareholders of the entire SQM Board at a subsequent annual meeting of SQM shareholders, but not less than 12 months from the date of such meeting, and (2) “Organizational Documents” means the certificate of incorporation (escritura de constitución), certificate of existence and legal representation (certificado de existencia y representación legal), Bylaws (estatutos) or any other similar organizational documents of SQM. |
| 4. | SQM Board Successors. In the event that any member of the SQM Board elected by the Class A shareholders ceases to serve as such for any reason (whether by his resignation, removal, disability, death or otherwise) each of the Parties will take all actions available to it to cause the SQM Board to elect his or her successor (or any future successor that is nominated by another SQM Board member) in accordance with the recommendation of the same Party that elected the SQM Board member that ceased to be a member. In the event that the member of the SQM Board elected by the Class B shareholders ceases to serve as such for any reason (whether by his resignation, failure to be re-elected, removal, disability, death or otherwise) (a) none of the Cascadas Shareholders nor the Kowa Shareholders will vote any SQM shares or take any other action that affects the election of his successor or any future successor (the “Class B Successor”) and (b) each of the Cascadas Shareholders and the Kowa Shareholders will take all actions available to it to ensure that the SQM Board does not approve any Class B Successor whose election was not approved by majority vote of the Class B shares (excluding any shares beneficially owned by any Cascadas Shareholder or Kowa Shareholder or as to which any Cascadas Shareholder or Kowa Shareholder has a proxy or exercises any voting control) or by the PCS Shareholders, as the case may be. |
| 5. | Further Assurances. In addition to other remedies, including specific performance (without the requirement of posting a bond or other form of assurance) or other equitable relief, as well as damages, in the event that the SQM Board takes action that is inconsistent with the expectations expressed in this Agreement, each of the Parties will take all actions available to it to remedy the situation, including, without limitation, reconstituting the Board, causing the removal of any member of the SQM Board who does not act in accordance with this Agreement and replacing such member of the SQM Board with one who will so comply, the Parties acknowledging that each of the Parties that first elected such removed member of the SQM Board will select his or her replacement. In addition, each of the Cascadas Shareholders, the Kowa Shareholders and the PCS Shareholders will cooperate with each other, at the request of any other Party, to execute and deliver any other instruments or documents and take all such further action as any other Party may reasonably request in order to evidence or effectuate the consummation of the events contemplated hereby and to otherwise carry out the intent of the Parties under this Agreement. To the extent permitted by applicable law, in the event there is any conflict between the Organizational Documents and this Agreement, as among the Parties, this Agreement will prevail. |
| 6. | Disclaimer. Except as otherwise expressly set forth herein, this Agreement embodies the complete agreement and understanding between the Parties with respect to the subject matter hereof and supersedes and preempts any prior understandings, agreements or representations by or among the Parties, written or oral, that may have related to the subject matter hereof in any way. Without limitation, the Parties have no agreement, arrangement or understanding except as |
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| expressly set forth herein and agree that (a) this Agreement does not constitute a voting agreement nor an acuerdo de actuación conjunta under the Ley de Mercado de Valores of the Republic of Chile and (b) the Parties are not acting as a “group” within the meaning of Rule 13d-5 under the United States Securities Exchange Act of 1934, as amended, nor as a grupo controlador under the Ley de Mercado de Valores of the Republic of Chile. |
| 7. | Delays or Omissions. No delay or omission to exercise any right, power or remedy accruing to any Party, upon any breach, default or noncompliance by another Party, will impair any such right, power or remedy, nor will it be construed to be a waiver of any such breach, default or noncompliance, or any acquiescence therein, or of or in any similar breach, default or noncompliance thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any Party of any breach, default or noncompliance under this Agreement or any waiver on such Party’s part of any provisions or conditions of this Agreement, must be in writing and signed by the Parties, or by email by an authorized agent, granting the waiver and will be effective only to the extent specifically set forth in such communication. All remedies will be cumulative and not alternative. |
| 8. | Term. The Agreement will become effective as of the date hereof upon execution and continue in full force and effect during the SQM Board Term and such time thereafter until terminated by any of the PCS Shareholders, the Kowa Shareholders or the Cascadas Shareholders, as the case may be, upon 30 days prior written notice given to the other Parties after the expiration of the SQM Board Term. |
| 9. | Language; Titles. This agreement is in the English language and will not be translated unless required by any competent governmental authority. In such event, the English version of this agreement will prevail. The titles of the sections of this Agreement are for convenience of reference only and are not to be considered in construing this Agreement. |
| 10. | Successors and Assigns. This Agreement will bind and inure to the benefit of and be enforceable by the Parties and their respective successors and assigns, including any transferee of SQM stock. |
| 11. | Governing Law; Jurisdiction. |
| A. | THIS AGREEMENT AND THE RIGHTS AND DUTIES OF THE PARTIES WILL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF NEW YORK WITHOUT REGARD TO ITS CONFLICT OF LAWS PRINCIPLES (EXCEPT THAT SUCH CORPORATE ACTIONS, DECISIONS AND ACTIVITIES TO BE CONDUCTED AND ADOPTED BY THE CORPORATE BODIES OF SQM WILL BE GOVERNED BY THE MANDATORY RULES STATED FOR SUCH ACTIONS, DECISIONS AND ACTIVITIES UNDER CHILEAN LAW). |
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| B. | Each of the Parties irrevocably agrees that all disputes, controversies or claims arising out of or in connection with this Agreement will be finally settled by international arbitration under the Rules of Arbitration of the International Chamber of Commerce (the “ICC Rules”) by three arbitrators. Within 30 days of receiving notice of any dispute, controversy or claim arising out of or in connection with this Agreement, each of the PCS Shareholders, the Kowa Shareholders and the Cascadas Shareholders irrevocably agrees that they will in good faith attempt to agree on arbitrators who are qualified in New York Law. In the event the Parties cannot agree on arbitrators within such 30-day period, then the arbitrators will be appointed in accordance with the ICC Rules. The place of arbitration will be New York, New York. The language of the arbitration will be English. The arbitral award will be final and binding on the Parties, not subject to appeal, and enforceable in accordance with its terms. The Parties agree that by submitting the dispute, controversy or claim to arbitration under the ICC Rules, the Parties undertake to implement any final award rendered by the arbitral tribunal without delay and that the prevailing Parties will be entitled to have the final award enforced in any applicable court. The arbitration costs will be borne by the losing party (or parties) or such other party (or parties) as designated by the arbitrator or arbitral panel (as applicable). In case it is necessary for one or more parties to the dispute to enforce the arbitral award through any type of court proceedings, the other party (or parties) to the dispute will bear all reasonable costs, expenses and attorney fees including any extra court fees or arbitration fees. |
| C. | EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY ACTION OR LIABILITY TO THE EXTENT ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT. EACH OF THE PARTIES HERETO HEREBY (1) CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY SUCH ACTION OR LIABILITY, SEEK TO ENFORCE THE FOREGOING WAIVER AND (2) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10(c). |
| D. | The foregoing, and any other provisions of this Agreement, do not affect the respective rights and obligations of the Parties or their respective affiliates in respect of any other matter, whether arising prior to or after the date of this Agreement. |
| 12. | Counterparts. This Agreement may be executed in any number of counterparts, each of which will be an original, but all of which together will constitute one instrument. This Agreement may be executed by facsimile or electronic mail signature(s). |
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| 13. | Notices. All notices and other communications hereunder will be in writing and will be deemed duly given to the Party to whom the same is delivered by email or facsimile transmission at the address and with contact information set forth on the signature pages hereto (or at such other address and contact information for a Party as will be specified by notice by such Party to the other Parties). |
Please confirm that the foregoing is in accordance with your understanding by signing and returning to us a countersigned copy of this letter, which will thereupon constitute a binding agreement as of the date first written above.
| PCS SHAREHOLDERS: | ||
| INVERSIONES EL BOLDO LIMITADA | ||
| By: | /s/ Jose Maria Eyzaguirre B. | |
| Name: | Jose Maria Eyzaguirre B. | |
| Title: | Attorney-in-Fact | |
| Av. Apoquindo 3721, piso 12 comuna de Las Condes | ||||
| Santiago, Republic of Chile | ||||
| Email wayne.brownlee@potashcorp.com jmeyzaguirre@claro.cl | ||||
| Attention: | Wayne Brownlee Jose Maria Eyzaguirre B. | |||
| INVERSIONES RAC CHILE LIMITADA | ||
| By: | /s/ Jose Maria Eyzaguirre B. | |
| Name: | Jose Maria Eyzaguirre B. | |
| Title: | Attorney-in-Fact | |
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| Av. Apoquindo 3721, piso 12 comuna de Las Condes | ||||
| Santiago, Republic of Chile | ||||
| Email wayne.brownlee@potashcorp.com jmeyzaguirre@claro.cl | ||||
| Attention: | Wayne Brownlee Jose Maria Eyzaguirre B. | |||
| INVERSIONES PCS CHILE LIMITADA | ||
| By: | /s/ Jose Maria Eyzaguirre B. | |
| Name: | Jose Maria Eyzaguirre B. | |
| Title: | Attorney-in-Fact | |
| Av. Apoquindo 3721, piso 12 comuna de Las Condes | ||
| Santiago, Republic of Chile | ||
| Email wayne.brownlee@potashcorp.com jmeyzaguirre@claro.cl | ||
| Attention: | Wayne Brownlee Jose Maria Eyzaguirre B. |
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Acknowledged and Agreed as of the date first written above:
| CASCADAS SHAREHOLDERS: | ||
| SOCIEDAD DE INVERSIONES PAMPA CALICHERA S.A. | ||
| By: | /s/ Patricio Contesse Fica | |
| Name: | Patricio Contesse Fica | |
| Title: | Executive Director | |
| El Trovador 4285, piso 11 comuna de Las Condes | ||
| Santiago, Republic of Chile | ||
| Email: pcontesse@calichera.cl | ||
| Attention: soddo@oddoycia.cl | ||
| POTASIOS DE CHILE S.A. | ||
| By: | /s/ Patricio Contesse Fica | |
| Name: | Patricio Contesse Fica | |
| Title: | Executive Director | |
| El Trovador 4285, piso 11 comuna de Las Condes | ||
| Santiago, Republic of Chile | ||
| Email: pcontesse@calichera.cl | ||
| Attention: soddo@oddoycia.cl | ||
| INVERSIONES GLOBAL MINING CHILE LIMITADA | ||
| By: | /s/ Ricardo Moreno Moreno | |
| Name: | Ricardo Moreno Moreno | |
| Title: | General Manager | |
| El Trovador 4285, piso 11 comuna de Las Condes | ||
| Santiago, Republic of Chile | ||
| Email: ricardo.moreno@calichera.cl | ||
| Attention: soddo@oddoycia.cl | ||
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Acknowledged and Agreed as of the date first written above:
| KOWA SHAREHOLDERS: | ||
| KOWA COMPANY LTD. | ||
| By: | /s/ Yoshihito Hata | |
| Name: | Yoshihito Hata | |
| Title: | Legal Representative | |
| Avenida Apoquindo 3472, oficina 1201 comuna de Las Condes | ||
| Santiago, República de Chile | ||
| Email: y-hata@kochi.cl | ||
| Attention: o-iwasa@kowa.co.jp | ||
| INVERSIONES LA ESPERANZA (CHILE) LIMITADA | ||
| By: | /s/ Yoshihito Hata | |
| Name: | Yoshihito Hata | |
| Title: | General Manager | |
| Avenida Apoquindo 3472, oficina 1201 comuna de Las Condes | ||
| Santiago, República de Chile | ||
| Email: y-hata@kochi.cl | ||
| Attention: o-iwasa@kowa.co.jp | ||
| KOCHI S.A. | ||
| By: | /s/ Yoshihito Hata | |
| Name: | Yoshihito Hata | |
| Title: | General Manager | |
| Avenida Apoquindo 3472, oficina 1201 comuna de Las Condes | ||
| Santiago, República de Chile | ||
| Email: y-hata@kochi.cl | ||
| Attention: o-iwasa@kowa.co.jp | ||
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| LA ESPERANZA DELAWARE CORPORATION | ||
| By: | /s/ Yoshihito Hata | |
| Name: | Yoshihito Hata | |
| Title: | Legal Representative | |
| Avenida Apoquindo 3472, oficina 1201 comuna de Las Condes | ||
| Santiago, República de Chile | ||
| Email: y-hata@kochi.cl | ||
| Attention: o-iwasa@kowa.co.jp | ||
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EXHIBIT A
DIVIDEND POLICY FOR BUSINESS YEAR 2017
SOCIEDAD QUÍMICA Y MINERA DE CHILE S.A.
Pursuant to Bulletin No 687 of the Chilean Superintendence of Securities and Insurance (Superintendencia de Valores y Seguros) of February 13, 1987, the Board of Directors of Sociedad Química y Minera de Chile S.A. (“SQM” or the “Company”) agrees to inform at the ordinary shareholders’ meeting, which is to be held on April 28, 2017, the following 2017 dividend policy:
The dividend policy sets out to distribute the net income obtained from the operations of SQM to its shareholders, while fulfilling its financial commitments, its obligations to the investment and finance policy approved at the ordinary shareholders’ meeting, and its investment plans approved by the Board of Directors.
Notwithstanding the obligation to inform a dividend policy in each ordinary shareholders’ meeting, in the best interest of SQM and all its shareholders, the Board of Directors has agreed to inform a dividend policy that it expects will be maintained during at least the next three years.
The 2017 dividend policy that the Board expects to be repeated during at least the next three business years, is as follows:
| a) | Distribute and pay, as a final dividend (dividendo definitivo) and in favor of the respective shareholders, a percentage of the net income that shall be determined per the following financial parameters: |
| (i) | 100% of the 2017 net income, when the following financial parameters are met: (a) that the total sum of cash and cash equivalent, other current financial assets (“Cash”) divided by the total sum of the current financial liabilities (“Current Financial Liabilities”) is equal to or exceeds 2.5 times, and (b) the total sum of the current liabilities and the non-current liabilities (“Total Liabilities”) divided by the total sum of the equity (“Equity”) is equal to or lower than 1.1 times. |
| (ii) | 80% of the 2017 net income when the following financial parameters are met: (a) that Cash divided by Current Financial Liabilities is equal to or exceeds 2.0 times, and (b) Total Liabilities divided by Equity is equal to or lower than 1.2 times. |
| (iii) | 60% of the 2017 net income when the following financial parameters are met: (a) that Cash divided by Current Financial Liabilities is equal to or exceeds 1.5 times, and (b) Total Liabilities divided by Equity is equal to or lower than 1.3 times. |
If none of the foregoing financial parameters are met, the Company shall distribute and pay, as a final dividend, and in favor of the respective shareholders, 50% of the 2017 net income.
| b) | Distribute and pay, if possible and during 2017, three interim dividends (dividendos provisorios) that will be charged against the aforementioned final dividend. These interim dividends shall likely be paid during the month following the approval of the March, June, and September 2017 interim financial statements, respectively. Its amounts shall be calculated as follows: |
| (i) | For the interim dividends that will be charged to the accumulated net income reflected in the March 2017 interim financial statements, the percentage distributed shall be determined per the financial parameters expressed in letter a) above. |
| (ii) | For the interim dividends that will be charged to the accumulated net income reflected in the June 2017 interim financial statements, the percentage distributed shall be determined per the financial parameters expressed in letter a) above, discounting the total amount of interim dividends previously distributed during 2017. |
| (iii) | For the interim dividends that will be charged to the accumulated net income reflected in the September 2017 interim financial statements, the percentage distributed shall be determined per the financial parameters expressed in letter a) above, discounting the total amount of interim dividends previously distributed during 2017. |
| c) | The amount of the interim dividends mentioned above may vary, pursuant to the information available to the Board of Directors on the date on which it agrees to the distribution of said dividends given that the dividend will not materially or negatively affect SQM’s capacity to impact its investments, fulfill its liabilities, or in general, comply with the investment and finance policy approved at the ordinary shareholders’ meeting. |
| d) | At the ordinary shareholders meeting that will be held in 2018, the Board of Directors shall propose a final dividend pursuant to the financial parameters expressed in letter a) above, discounting the total amount of the interim dividends previously distributed during 2017. |
| e) | If there is an excess of net income in 2017, this may be retained and assigned or allocated for financing its own operations, to one or more investment projects of the Company, notwithstanding a future distribution of potential dividends (dividendos eventuales) charged to the accumulated net income previously approved at the shareholders’ meeting, or the possible and future capitalization of all or part of the latter. |
| f) | The Board of Directors does not consider the payment of additional dividends (dividendos adicionales). |
It is expressly stated that the dividend policy described above corresponds to the intention of the Board of Directors, and the compliance of it shall depend on the net income that the Company ultimately obtains, as well as the results of periodic projections that could impact the Company, or to the existence of determined conditions that may affect it, as applicable. If the dividend policy exposed by the Board of Directors suffers a substantial change, the Company must communicate it as an essential fact (hecho esencial) to the SVS.