1

Vote FOR the Agrium Nominees

to Reject JANA’s Trojan Horse Tactics to Break Up Your Company

Continue Agrium’s Highly Successful

Integrated Strategy

March 4, 2013

Exhibit 1

1

Forward-Looking Statements

2

Currency of Presentation

All dollar amounts in this presentation refer to U.S. dollars except where otherwise stated.

Forward-looking Statements Advisory

Certain statements and other information included in this presentation constitute “forward-looking information” or “financial outlook” within the meaning of applicable Canadian securities legislation or constitute “forward-looking statements” within

the meaning of applicable U.S. securities legislation (collectively, “forward-looking statements”). Forward-looking statements are typically identified by the words “believe”, “expect”, “estimate”, “would” and other similar expressions. All statements

in this presentation other than those relating to historical information or current conditions are forward-looking statements, including, but not limited to, statements as to management’s expectations, estimates and analysis with respect to: our

positive outlook and ability to continue achieving record results and significant and sustainable value; the composition of our Board of Directors and its ability to oversee Agrium’s integrated strategy and safeguard the interests of all Agrium

shareholders; JANA’s dissident nominees; the feasibility, value and impact of JANA’s ideas and strategies for Agrium, including, without limitation, with respect to the break-up of Agrium, and our belief that these ideas and strategies are not in

the best interests of Agrium and its shareholders, will destroy shareholder value and will imperil Agrium’s ability to manage its global operations; the impact of various multiples and assumptions on the value of our existing business and the

businesses of certain of our peers; the benefits, efficiencies and opportunities resulting from the integrated nature of our business; our estimate that separating Retail and Wholesale would reduce the company’s borrowing capacity, at our

existing credit ratings, by approximately $750 million; our estimate that if we were to run Retail on the same basis as UAP in 2007, it would destroy over $2.5 billion of shareholder value; the pending purchase of the former Viterra assets from

Glencore and the value to be derived there from including our expectation that the transaction will contribute approximately $100 million of EBITDA annually; our capital allocation priorities; our belief that we will continue to grow our dividend and

return excess capital to shareholders; our confidence in our ability to continue creating significant shareholder value through the diligent execution of ongoing continuous improvement initiatives; and our 2015 financial and operational targets,

including, without limitation, our targets for Retail EBITDA and return on capital employed. The purpose of the financial outlook included in this presentation is to assist readers in understanding our expected and targeted financial results and this

information may not be appropriate for other purposes. Readers are cautioned not to place undue reliance on forward-looking statements which involve known and unknown material risks and uncertainties that may cause our actual results,

performance or achievements to be materially different from any future results, performance or achievements expressed or implied in such forward-looking statements.

The forward-looking statements included in this presentation are based on certain assumptions and analysis made by us in light of our experience and perception of historical trends, current conditions and expected future developments as well

as other factors we believe are appropriate in the circumstances. All of the forward-looking statements are qualified by the assumptions that are stated or inherent in such forward-looking statements. The key assumptions that have been made in

connection with such forward-looking statements include, among other things: assumptions with respect to Agrium’s acquisitions; that future business, regulatory and industry conditions will be within normal parameters, including with respect to

prices, margins, product availability and supplier agreements; the completion of projects on schedule, as planned and on budget; assumptions with respect to U.S. and global economic conditions; our ability to access our credit facilities or capital

markets for additional sources of financing; and the assumptions set forth under the heading “Key Assumptions and Risks in Respect of Forward-Looking Statements” on pages 82 to 83 of Agrium’s Management’s Discussion & Analysis for the

year ended December 31, 2012 (the “2012 MD&A”).

By their nature, forward-looking statements are subject to various risks and uncertainties which could cause Agrium’s anticipated results and experience to differ materially from the anticipated results or expectations expressed. The key risks and

uncertainties that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: general economic, market and business conditions; weather conditions including impacts from regional

flooding and/or drought conditions; crop prices; the supply and demand and price levels for our major products; governmental and regulatory requirements and actions by governmental authorities, including changes in government policy,

government ownership requirements, changes in environmental, tax, anti-trust and other laws or regulations and the interpretation thereof, and political risks, including civil unrest, actions by armed groups or conflict, as well as counterparty and

sovereign risk; actions by competitors and others that include changes to industry capacity, utilization rates and product pricing; performance by customers, suppliers and counterparties to financial instruments; changes in the development plans

for our major capital expansion and improvement projects including the potential for higher costs, delays, issues with counterparties, risks associated with technology or inflationary pressure; fluctuations in foreign exchange and tax rates; a

deterioration in the state of the capital markets or a negative bias towards Agrium or its industry by market participants; gas prices and gas availability; operating risks associated with investment in foreign jurisdictions; reliability of performance of

existing capital assets; changes in margins and/or levels of supplier rebates; political risks associated with our interests in the Egyptian Misr Fertilizers Production Company S.A.E. nitrogen facility in Egypt, the Argentine Profertil nitrogen facilities

and other facilities; environmental, health, safety and security risks typical of those found throughout the agriculture, mining and chemical manufacturing sectors and fertilizer supply chain; risks related to our proposed business acquisitions

including risks related to our ability to close such acquisitions as anticipated and to integrate and achieve synergies from any assets we may acquire within the time or at the performance level expected; and the risks set forth in the 2012 MD&A

on pages 74 to 77 under the heading “Enterprise Risk Management — Key Business Risks” and pages 82 to 83 under the heading “Key Assumptions and Risks in Respect of Forward-Looking Statements”. Additional information and other risk

factors respecting the business and operations of Agrium as are detailed from time to time in Agrium reports filed with the Canadian securities regulators and the Securities and Exchange Commission in the United States.

Agrium disclaims any intention or obligation to update or revise any forward-looking statements in this presentation as a result of new information or future events, except as may be required under applicable U.S. federal securities laws or

applicable Canadian securities legislation.

IFRS Advisory

Historical financial information relating to Agrium for periods beginning on or after January 1, 2010 presented and discussed in this presentation is prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by

the International Accounting Standards Board. All financial information relating to Agrium for periods prior to 2010 is prepared in accordance with previous Canadian generally accepted accounting principles in place prior to the adoption of IFRS.

For more information about Agrium’s conversion to IFRS, please see note 30 of the Notes to the Consolidated Financial Statements as at and for the year ended December 31, 2011 available under Agrium’s profile on SEDAR at www.sedar.com

and on EDGAR at www.sec.gov.

Non-IFRS Financial Measures Advisory

We consider EBITDA to be a useful measure of performance because income tax jurisdictions and business units are not synonymous and we believe that allocation of income tax charges distorts the comparability of historical performance for

the different business units. Similarly, financing and related interest charges cannot be allocated to all business units on a basis that is meaningful for comparison with other companies.

EBITDA is not a recognized measure under IFRS and our method of calculation may not be comparable to that of other companies. Similarly, EBITDA should not be used as an alternative to net earnings from continuing operations as

determined in accordance with IFRS. Please refer to pages 50 to 51 of Agrium’s 2012 MD&A under the heading “Additional and Non-IFRS Financial Measures” for a reconciliation of EBITDA to consolidated net earnings from continuing

operations for 2012 and 2011 and to pages 68of Agrium’s 2012 MD&A under the heading “Additional and Non-IFRS Financial Measures” for a reconciliation of EBITDA to consolidated net earnings from continuing operations for the three

months ended December 31, 2012. For years prior to this, please refer to the applicable annual report for the reconciliation of EBIT/EBITDA to net earnings. 

2

3

JANA’s Goal is to Break Up Agrium

“Agrium

should

promptly

separate

Retail

as

a

standalone

company”

–

JANA Presentation for Agrium Board, July 11, 2012

“We

also

continue

to

believe

that

a

separation

of

the

Retail

business

would

unlock

significant

long-term

value”

–

JANA Press Release, August 14, 2012

“There’s

tremendous

upside

to

be

created

by

splitting

them

up”

–

Barry Rosenstein –

Interview on CNBC, October 1, 2012

“Agrium

has

a

myriad

of

steps

it

can

take

today…purs[ue] a

separation

of

Retail

and

Wholesale”

–

JANA Presentation, October 1, 2012

“Well,

let…

let

me

make

it

first

of

all

clear.

I

mean,

we…

we’re

not

solely

talking

about

breaking

up

the

business”

–

Barry Rosenstein –

Interview on BNN, January 30, 2013

3

•

Victor J. Zaleschuk, Board Chair

(1)

:

•

This year’s election for the Board of Directors has become a choice between two competing visions

for Agrium’s future. One vision is endorsed by Agrium’s Board and management, and has the support

of an overwhelming majority of Agrium’s large institutional shareholders and the equity research

community

•

You are invested in a company that has delivered a 467% shareholder return since embarking on its

current

integrated

strategy

–

a

strategy

that

continues

to

create

record

results

and

significant and

sustainable value

•

The other vision is being promoted by a New York-based activist hedge fund called JANA Partners.

JANA wants Agrium to abandon its current strategy, break itself into three small pieces, and take other

actions that will destroy shareholder value. To further its flawed agenda, JANA has put forward its own

dissident slate of 5 director nominees

•

While our Board has evaluated Agrium’s corporate strategy and structure many times in the past, the

Board

has

taken

JANA’s

concerns

seriously.

JANA

first

contacted

Agrium

in

May

2012.

We

immediately engaged an independent financial advisor and independent legal counsel to advise the

independent directors of the Board.  After an in-depth, two-month review, the independent directors

concluded that JANA’s break-up plan and its other demands would destroy shareholder value and

were contrary to the best interests of the company and its shareholders. The Board has reviewed

each successive argument JANA has made and continues to be of the view that JANA’s demands

would destroy value and are not in the best interests of Agrium and its shareholders

Notes

1. From Message from the Chair, 2013 Agrium Proxy Circular

4

Protect the Value of Your Investment

•

Stop the break up of Agrium –

Vote FOR the Agrium nominees on the

WHITE

form of proxy today

•

Proxy

Cut-off

–

Proxies

must

be

returned

by

and

no

later

than

April 5,

2013 at 11 a.m. (Calgary time)

4

5

Agrium Shares Have Outperformed

Total Shareholder Return As of February 13, 2013

1.

Retail consolidation strategy initiated with announcement of acquisition of Royster-Clark on 11/8/2005

2.

Since 1/1/2009

3.

Basic Material Distribution Companies that were public as of 11/8/2005 and as of 1/1/2009 include Airgas, Beacon Roofing, and Reliance Steel and Aluminum

4.

Basic Material Distribution Companies that were public as of 1/26/2012 include Airgas, Beacon Roofing, Brenntag and Reliance Steel and Aluminum

5.

General

Industrial

Distribution

Companies

that

were

public

as

of

all

three

periods

in

the

above

charts

include

Applied

Industrial,

Genuine

Parts,

Grainger,

MSC

Industrial,

Tractor

Supply, Watsco, and WESCO

168

1,572

467

375

369

275

177

0

100

200

300

400

1,700

Since

Initiating

Retail

Strategy

(1)

Last Twelve Months

Rebound

From

Financial

Crisis

(2)

Source: Capital IQ

Basic Material Distribution Companies

General Industrial Distribution Companies

Fertilizer Peers

(%)

CF

Agrium

Potash

Corp

Mosaic

Yara

BM

Dist.

(3)

GI

Dist.

(5)

78

17

83

170

205

223

235

354

0

50

100

150

200

400

CF

Agrium

GI

Dist.

(5)

BM

Dist.

(3)

Yara

Potash

Corp

Mosaic

(%)

(%)

39

39

23

22

15

13

0

(4)

(10)

0

10

20

30

40

50

Agrium

BM

Dist.

(4)

CF

Yara

GI

Dist.

(5)

Mosaic

Potash

Corp

Intrepid

Potash

Intrepid

Potash

•

Agrium

initiated

its

integrated

strategy

with

the

acquisition

of

Royster-Clark

in

late

2005

and its

shares (including dividends) have appreciated 467% since this time

•

Shares of Agrium have outperformed the peers, as well as the public distribution company

composites, over the near and long term

(1)

•

Since the financial crisis caused global equities to bottom in January of 2009, Agrium shares returned

235%, outperforming all peers since this time

(1)

•

During the last 12 months, Agrium shares have outperformed all peers, including CF, as well as the

public distribution company composites. This performance was driven by Agrium’s record financial

results,

increased

profits

at

Agrium

Retail,

dividend

increases,

a

C$900

million

share

repurchase,

and

a positive outlook for 2013 and beyond

•

Our returns are also significantly better than a composite of publicly-traded distribution companies

that

JANA

has

suggested

should

be

considered

as

peers

for

Agrium

Retail

•

We have illustrated their performance solely because JANA has said they should be considered

peers even though none of these companies distribute agricultural input products (i.e. fertilizers,

seeds, and crop protection chemicals)

•

There are no direct peers in the public markets for Agrium Retail because all of its competitors are

privately-held companies

Notes

1.

With the exception of CF.  As a pure play on North American nitrogen, CF has benefited from a number of factors, in

particular, the significant decline in U.S. natural gas prices beginning in 2010.

5

6

2003

Now

Position

Primarily a North American

Nitrogen Producer

Leading Global, Integrated

Agricultural Inputs Company

Wholesale

$1.5Bn in fertilizer sales

$5.5Bn in fertilizer sales (2012)

Retail

Revenue: $1Bn

224 locations

Revenue: $11.5Bn (2012)

1,292 locations (2012)

EBITDA

$400MM

$2,666MM (2012)

Market Cap

$2.1Bn

(1)

$16.7Bn

(2)

Stock Price

$16.46

(1)

$112.16

(2)

Dividend per Share

$0.11

$2.00

1.

Based on Agrium stock price at December 31, 2003

2.

Based on Agrium stock price at February 13, 2013

Integrated Strategy is Working Extremely Well

•

10 years ago, Agrium was essentially a small, North American nitrogen fertilizer

producer with a small Retail business

•

We had to decide whether we were going to stay in Retail or exit.  We saw a

real opportunity to build scale in the North American ag retail space.  Retail was a

profitable business that had synergies with our Wholesale business and

provided cash flow stability and growth opportunities

•

We decided to stay in Retail and we commenced our consolidation of North American

retail with the acquisition of Royster-Clark in late 2005.  It has been a tremendously

successful strategy and Agrium had the vision and foresight to pursue the opportunity

•

Today, Agrium is a highly-focused, integrated agricultural inputs company with 2012

nutrient sales of $5.5Bn, retail sales of $11.5Bn, EBITDA of $2.7 billion and a current

market capitalization of approximately $17Bn

•

Our success has been led and driven by our current Board and management team

6

7

Benefits to Retail

•

Global commodity market intelligence

•

Access to product from Wholesale during

periods of short supply

•

Ability to share and optimize storage and

distribution assets

•

Ability to target acquisition opportunities

with production and/or bulk distribution

components

Benefits to Wholesale

•

Access to North American downstream

sales channel for increased potash

production

•

Ability to maximize operating rates of

production assets through offtake

arrangements with Retail

•

Optimization of storage and distribution

assets

•

Local/regional grower market intelligence to

assess local supply/demand fundamentals

Additional Benefits to Agrium

•

Agrium is better able to compete in a highly competitive marketplace

•

Centralized

corporate

functions

and

centralized

IT

functions

are

leveraged

Agrium-wide

•

Stronger credit profile provides market access assurance and lower borrowing costs through

the cycle 

Integrated Strategy Benefits All of Agrium

•

Wholesale and Retail together give Agrium greater scale, efficiency, a lower cost of capital, greater

access to capital, more stable earnings and expanded growth opportunities

•

Wholesale benefits from increased potash production and sales, access to Retail’s North American

sales channel, the ability to maximize operating rates and optimize storage and distribution assets,

as well as the market intelligence that comes from having direct

access to customers

•

Retail benefits from global commodity market intelligence, access to product during periods of short

supply, and the ability to share and optimize storage and distribution assets

•

Both Wholesale and Retail benefit from the ability to target acquisition opportunities with production

and retail components

•

The pending acquisition from Glencore of the Agri Products business formerly operated by Viterra (a

combination of production and retail) is a good example of an opportunity that Agrium was uniquely

positioned to capture, specifically because Agrium operates across the agricultural inputs value chain

•

We will acquire these assets at a highly attractive value (< 6x pre-synergies) and expect this

transaction to contribute ~$100MM of EBITDA annually

•

The debt rating agencies have told us they like our integrated structure. Our integrated structure is

credit enhancing because our cash flows are countercyclical and more stable relative to our fertilizer

peers. Separating Retail and Wholesale would reduce the company’s borrowing capacity, at our

existing credit ratings, by ~$750MM

7

8

8

Revenue per Facility

(1)

($ million)

5.3

9.0

10.3

10.3

12.1

13.8

0

2

4

6

8

10

12

14

16

2007

2008

2009

2010

2011

2012

EBITDA per Facility

(1)

($ thousand)

1.

North America only

Agrium Retail is an Excellent and Well-Managed Business

+160%

+195%

450

915

685

465

794

1,089

1,329

0

200

400

600

800

1,000

1,200

1,400

2007

2008

Avg

'08/'09

2009

2010

2011

2012

8

•

Agrium Retail is built on a platform of operational excellence and continuous

improvement

•

We have a best-in-class management team drawn from Agrium’s legacy Retail

business and acquisitions like UAP, Royster-Clark and Landmark, as well as others

•

Retail has increased EBITDA from $85MM in 2003 to $951MM in 2012

•

As we integrate acquired companies into our core business, we optimize our Retail

network by closing less efficient facilities. This leads to improved profitability, margins

and returns

•

Retail’s state-of-the-art systems provide visibility down to the single-store level,

allowing Agrium to make the right operating and closure decisions. Agrium has

consolidated more than 255 facilities in recent years

•

We are also rapidly increasing performance at the facilities we continue to operate.

Since 2007, Agrium Retail has increased revenue per facility by 160% and profit

(EBITDA) per facility by 195%

9

Announced

Year

Target

Acquisition

Value

(1)

($ billion)

Acquisition

Multiple

(2)

(inc. announced

synergies)

Acquisition

Multiple

(3)

(inc. addn’l

synergies and

market growth)

2005

Royster-Clark

$0.4

5.1x

4.0x

2007

UAP

2.7

8.3x

6.1x

2010

Landmark

0.9

9.1x

TBD

2007-2011

Cumulative

Cumulative Tuck-in

Acquisitions

0.5

4.1x

4.1x

Retail M&A Strategy Has Created Significant Value

1.

Net of proceeds from sale of non-core businesses at target

2.

Based on pre-acquisition EBITDA plus targeted synergies

3.

Additional synergies and market growth, as shown on previous slide, have been allocated between the legacy Agrium Retail that existed in 2005 (34%), Royster-

Clark (10%) and UAP (56%), based on an estimate of their relative contribution to 2012 EBITDA

•

Agrium has acquired $4.5Bn of Retail assets at an average

multiple of less than 6x EBITDA including synergies achieved, well

below the multiple of over 9x that Agrium is receiving for Retail in

its stock today

•

The pending acquisition from Glencore of the Agri Products

business formerly operated by Viterra (a combination of production

and retail) is a good example of an opportunity that Agrium was

uniquely positioned to capture, specifically because Agrium

operates across the agricultural inputs value chain

•

We will acquire the Agri Product’s business formerly operated by

Viterra at a highly attractive value (< 6x pre-synergies) and expect

this transaction to contribute ~$100MM of EBITDA annually

9

10

Agrium

is

Driving

Value

at

Retail

Through

Continuous

Improvement

Retail Metric

2012 Result

2015 Target

EBITDA ($MM)

951

1,300

EBITDA Margin

8%

10%

ROCE

9%

13%

ROCE (ex. Goodwill and Intangibles)

18%

22%

Working Capital to Revenue

20%

18%

Operating Costs to Gross Profit

69%

67%

10

•

We are proud of our track record. But we understand that the real

measure of value and accountability isn’t what we’ve done so far,

but what we plan to next deliver for shareholders

•

We have published 2015 targets for Agrium Retail EBITDA of $1.3

billion and Return on Capital Employed (ROCE) of 13%, in addition

to other continuous improvement targets

•

Through 2013 and 2014, as we work towards our Retail targets,

Richard Gearheard and the Retail management team will have

clear line of sight to these targets in their compensation structure

•

We are confident in our ability to continue creating significant

shareholder value through the diligent execution of ongoing

continuous improvement initiatives

11

•

Agrium delivered record results for 4Q and matched the record

annual earnings achieved in 2011

•

Generated $2.1Bn in operating cash flow, the highest in company

history

Integrated Strategy Driving Record Results

2012 Results Summary

$16.7Bn Sales, up 8% YoY

$2.7Bn EBITDA, up 2% YoY

$1.5Bn Net Earnings

4th Quarter Results Summary

$3.3Bn Sales, up 3% YoY

$650MM EBITDA, up 14% YoY

$354MM Net Earnings, up 8% YoY

•

Our integrated strategy has produced two consecutive years of

record earnings, and increased earnings from Agrium Retail by

more than 50% since 2010

•

Agrium’s integrated strategy is driving increases in earnings

and cash flow, and enabling the company to return excess capital

to shareholders

•

Retail’s stable cash flows underpin Agrium’s ability to pay an

increasingly attractive dividend

•

We have long said we would increase dividends as earnings and

cash flow from Retail grow

•

Agrium began increasing its dividend in 2011 as earnings and cash

flow increased, well before JANA’s campaign

11

12

Agrium is Committed to Returning Capital

Dividend Yield (%)

(1)

Source: Capital IQ

1.

As of February 13, 2013

•

Our dividend yield is higher than all but 1 of our peers, and also

higher than the average public distribution company, as well as MSC

and Brenntag, companies led by 2 of JANA’s nominees

Our capital allocation priorities:

1.

Preserve shareholder value

–

Preserve balance sheet strength and investment grade credit ratings

–

Sustain capital to maintain base business performance

–

Maintain current dividend

2.

Grow shareholder value

–

Organic and external opportunities at returns in excess of our cost of

capital

3.

Return excess capital that cannot be reinvested above our cost of

capital

–

Remain disciplined about returning excess capital to shareholders

–

Continue to increase our dividend as we grow our earnings

–

Repurchase stock primarily on an opportunistic basis

12

13

Member

Profile

Victor J.

Zaleschuk

Age: 69

Mr. Zaleschuk, is a Director and Board Chair of Cameco

Corporation. He joined Agrium's Board in 2002, and was

appointed Board Chair in May 2012.

Ralph S.

Cunningham

(1)

Age: 73

Dr. Cunningham, is Board Chair of Enterprise Products

Holdings, LLC. He serves as Board Chair of TETRA

Technologies, Inc. and Director of Cenovus Energy Inc.

He joined Agrium's Board in 1996.

David Everitt

Age: 61

David Everitt recently retired as President, Agricultural

Division for North America, Australia, Asian and Global

Tractor Sourcing, Turf Products and Technology for Deere

& Company. He is a director of Brunswick Corporation and

Harsco Corporation and is also a board member of the

National Business Aviation Association.  He joined

Agrium’s board in 2013.

Russell K.

Girling

Age: 50

Mr. Girling, is a Director and the President and Chief

Executive Officer of TransCanada Corporation. He is the

former Chair and Chief Executive Officer of TC Pipelines,

GP Inc. (general partner of TC Pipelines, L.P.), former

Chair of TransCanada Power, L.P., and former director,

Bruce Power Inc. He joined Agrium’s Board in 2006.

Dr. Susan A.

Henry

Age: 66

Dr. Henry, is a Professor of Molecular Biology and

Genetics and Dean Emerita of the College of Agriculture

and Life Sciences at Cornell University in Ithaca, NY. She

is on the Boards of Seneca Foods Corporation and

Tompkins Financial Corporation. She joined Agrium's

Board in 2001.

Russell J. Horner

Age: 63

Mr. Horner, is the former President and Chief Executive

Officer of Catalyst Paper Corporation. He joined Agrium’s

Board in 2004.

David J. Lesar

Age: 59

Mr. Lesar, is Chair, President and Chief Executive Officer

of Halliburton Company. He serves on the Board of

American Petroleum Institute and is a former director of

Lyondell Chemical Company and Mirant Corporation Mr.

Lesar joined Agrium's Board in 2010.

Agrium Has an Outstanding Board

New Independent Directors

Member

Profile

John E. Lowe

Age: 54

Mr. Lowe, is the former Assistant to the Chief Executive

Officer of ConocoPhillips. He is a former Director of DCP

Midstream GP, LLC and a former director of Chevron

Phillips Chemical Co. LLC. Mr. Lowe joined Agrium's

Board in 2010.

Anne McLellan

Age: 62

Ms. McLellan, serves on the Board of Cameco

Corporation. She is a Director of Canadian Business for

Social Responsibility (CBSR), a member of TD

Securities Energy Advisory Board and Counsel at the

law firm of Bennett Jones LLP. She joined Agrium's

Board in 2006.

Derek G. Pannell

Age: 66

Mr. Pannell, is Board Chair of Brookfield Infrastructure

Partners Limited and Lead Director of African Barrick

Gold plc. He was President and Chief Executive Officer

of Noranda Inc. and Falconbridge Limited. He joined

Agrium's Board in 2008.

Frank W. Proto

Age: 70

Mr. Proto, is a former director of Nelson Group Inc. He

joined Agrium's Board in 1993 and has served as Board

Chair

from

September

1998

-

May

2012.

Mayo Schmidt

Age: 55

Mr. Schmidt was the President and Chief Executive

Officer of Viterra Inc. from 2000 until 2012. He is a

member of the Canadian Council of Chief Executive

Officers, a member of Washburn University’s Board of

Trustees and the Lincoln Society, and a contributor to

Harvard University’s Private and Public, Scientific,

Academic and Consumer Food Policy Group. He also

serves on the Board of Directors of the Global

Transportation Hub Authority.  He joined Agrium’s board

in 2013.

Michael M.

Wilson

Age: 61

Mike joined the company in 2000 and became President

and Chief Executive Officer three years later. Under his

leadership Agrium has grown significantly increasing its

size and profile in world markets. Prior to joining Agrium,

Mike gathered experience as an executive leader in the

chemical industry. He was the President of Methanol

and President and Chief Operating Officer of Methanex

Corporation. He joined Agrium's Board in 2003.

Insider

Independent Directors

1.

Will retire at upcoming annual meeting

•

Agrium’s Board is routinely recognized for its strong corporate governance

•

Agrium’s

Board

was

awarded

a

9.5

out

of

10

Overall

Rating,

and

a

10

out

of

10

rating

for Board Accountability, by Governance Metrics International, while placing 25th out

of 244 companies evaluated in The Globe and Mail’s 2012 Corporate Governance

Rankings

•

Agrium’s

recent

Board

appointees

–

David

Everitt

and

Mayo

Schmidt

–

were

selected

following an extensive search that began in March 2012. The search was conducted

by the Governance Committee of the Board with the assistance of an international

executive search firm

•

Mr.

Everitt

and

Mr.

Schmidt

each

bring

deep

agricultural,

retail

and

distribution

expertise and industry knowledge, combined with impeccable reputations for integrity,

independence and a commitment to serving shareholders’

best interests

•

Mr. Everitt brings in-depth knowledge of marketing, distribution and procurement in the

agricultural sector, obtained during his 37-year career at John Deere

•

Mr. Schmidt is widely recognized for leading Viterra's transformation from a small,

regionally based cooperative into Canada's largest agricultural inputs retailer and a

leading

global

agricultural

and

food

ingredients

company.

With

a

network

of

263

agricultural retail locations, Viterra was the only publicly-traded agricultural retailer of

fertilizer,

crop

chemicals

and

seed

in

North

America,

other

than

Agrium

13

14

Analysts Support Board and New Appointments

•

While on the topic of corporate governance, we note that [Agrium] was ranked 25th out of

several hundred in the 2012 Canadian Corporate Governance rankings. Out of four

variables considered, [Agrium’s] board was either at or within one mark of the top ranking. 

The exception to this was board composition, which [Agrium] has now correctly

addressed…It's

interesting

to

note

that

none

of

the

companies

ranked

ahead

of

[Agrium]

on

corporate governance have provided shareholders with a better five-year return, according

to

the

Globe

&

Mail.”

–

Scotiabank,

2/21/13

•

“The

two

new

directors

appointed

to

[Agrium’s]

board

have

extensive

agricultural,

retail

and

distribution experience, in our view. We believe that they will be well-received by

investors...”

–

TD

Securities,

2/12/13

•

“The company should benefit from both the agricultural knowledge both offer in addition to

Everitt’s

distribution

experience

on

the

dealer

and

equipment

side;

as

well,

Schmidt’s

extensive knowledge of agriculture and retail operations –

in addition to leading the

transformation

of

Viterra

into

a

leading

global

agricultural

and

food

ingredients

company”

–

AltaCorp, 2/12/13

•

Agrium announced the appointment of two experienced retail/distribution executives (David

Everitt

and

Mayo

Schmidt)

to

its

Board...”

–

BMO,

2/11/13

•

“We

are

confident

that

[Agrium’s]

board

has

indeed

delivered

exceptional

value

to

shareholders

since

[Agrium]

initiated

its

integrated

strategy

in

2005.

Is

[Agrium’s]

board

perfect?

Not

at

all,

but

we

think

they’re

pretty

darn

good.”

–

Scotiabank,

1/29/13

•

JANA has said it thinks David Everitt and Mayo Schmidt lack suitable

experience and independence. On any objective basis, that argument lacks

all credibility

•

Analysts support the Board and the recent appointments

14

15

Reject JANA’s Dissident Slate

15

16

JANA gets an “F”

for its “5 Cs”

1.

Clearly

Wrong

on

Conglomerate

Structure

2.

Contrary to the Facts on Capital Allocation

3.

Confused on Costs

4.

Careless with Facts on Controls

5.

Cavalier on Corporate Governance

JANA’s Analysis is Highly Flawed and Contrived

•

JANA’s

break-up

analysis

is

flawed

and

contrived

–

and

its

other

ideas

would also destroy shareholder value

•

After failing for months to gain support for its break-up plan, JANA recently

changed

course

and

started

arguing

that

Agrium

is

poorly

managed and

has a weak Board

•

JANA

re-branded

its

argument

as

the

“5

Cs”

and

attacked

Agrium

on:

“Conglomerate Structure, Capital Allocation, Costs, Controls, and

Corporate Governance”

•

Agrium

has

considered

each

of

JANA’s

“5

Cs”

and

gives

each

of them an “F”

•

Agrium provided shareholders and analysts an in depth review of the

flawed Cs during its 4.5 hour January 28 Analyst Day event.  The

presentation is available on the Agrium website:

http://www.agrium.com/includes/Jan._2013_Analyst_Event_Presentation.pdf

16

17

•

Agrium is a highly-focused, integrated agricultural

inputs company, not a conglomerate

•

Since we initiated our integrated strategy, Agrium

shares have generated a return of 467%

•

JANA’s agenda has been to break up Agrium into 2 or

3 pieces in an effort to see the pieces sold

•

A break up would destroy rather than create value for

shareholders

•

Retail is worth more as a part of Agrium and receives

a multiple of over 9x within Agrium

JANA is Clearly Wrong on Conglomerate Structure

17

18

JANA Proposed a 3-Way Break Up of Agrium

JANA Slide

Presented to

Agrium on

July 11, 2012

1.

Assumes elimination of conglomerate structure results in valuation consistent with Agrium’s sum of the parts value based on Susquehanna Research as of July 10, 2012.

2.

Assumes Agrium releases $725 million of excess net working capital, per commentary on page 27.

3.

Assumes rationalization of Retail segment costs and corporate overhead costs. For Retail, assumes Agrium right-sizes overhead to pro forma UAP / Agrium levels at the

time of the transaction at 70.9% Operating Expense / Gross Profit (as detailed on page 28). For corporate, assumes that Agrium can rationalize 50% of unallocated

overhead costs following the separation of Retail, offset by $10 million of assumed new standalone public company costs in Retail. Assumes incremental after-tax earnings

resulting form cost rationalization efforts are capitalized at Agrium’s valuation following elimination of corporate discount, per footnote #1.

4.

Assumes Agrium initiates a $1.5 billion share repurchase program ahead of implementing steps 1-3, repurchasing stock at $89 per share funded by $725 million of

released working capital and by $775 million of debt at a 4.5% after-tax cost of capital. Value creation represents immediate accretion (growing further over time) of share

repurchases assuming value creation from steps 1-3.

5.

Assumes Agrium’s Potash assets receive partial credit from investors for their strategic value. Value creation assumes Potash valued at 11.25x EBITDA, representing 50%

of bridge between Susquehanna’s 9x sum of the parts value for Agrium’s Potash assets and the 13.5x value BHP offered to acquire Potash Corp.

•

On July

11,

2012,

JANA

proposed

a

3-way

break

up

based

exclusively

on

1

analyst’s

target

multiple

(the

highest)

and

completely

ignored

where

the

public

peers

were

trading

•

The slide above was presented by JANA to Agrium on July 11 in New York

•

JANA said a break up would create monumental value for shareholders

–

A 2-way break up (Retail and Wholesale) would create over $28 per share

–

A 3-way break up (Retail, Potash and Nitrogen + Phosphate) would create over $34 per share

•

JANA’s

views

were

based

exclusively

on

the

one

sell-side

analyst

with

the

highest

“target”

multiple

for

Retail

and

highest

share

price

target

for

Agrium.

The

analysis

also

assumed

a

“trading”

multiple

of

11.25x

for

our

potash segment, well above where peers were trading

•

Since they first contacted us in May, JANA has never provided a detailed and credible value creation analysis

supporting a break up to Agrium

•

From

the

very

start,

JANA’s

agenda

has

been

to

break

up

Agrium

into

2

or

3

pieces

in

an

effort

to see the

pieces sold.  We believe this is why JANA has had countless meetings with executives from our public

competitors, private equity firms, merger arbitrageurs, equity research analysts, shareholders and

others since early June

18

19

$ billion, unless otherwise noted

Agrium Share Price as of February 13, 2013

$112.16

Market Capitalization

(2)

16.7

Enterprise Value

(3)

18.5

Less: Value of Segments Based on Peer Trading Multiples

2013E EBITDA

(4)

2013E Peer

Multiple

(5)

Segment

Value

Nitrogen / Other

(6)

$1.1

4.3x

$4.8

Potash

(7)

0.4

8.9x

3.4

Phosphate

0.3

6.0x

1.6

Wholesale

1.8

5.6x

9.8

Implied Current Value of Retail Within Agrium

$8.7

Implied 2013E EBITDA Multiple for Retail

0.9

9.2x

Break Up Would Destroy Value

Retail is worth more as a part of Agrium and receives over a 9x multiple within Agrium

(1)

1.

Multiple implied by sum-of-the-parts analysis based on Agrium share prices, Wholesale peer multiples and consensus analyst EBITDA estimates as of February 13, 2013

2.

Assumes fully diluted share count of 149.3 million

3.

Agrium net debt balance adjusted for impact of C$900 million share repurchase

4.

Segment EBITDA breakout based on consensus 2013E total Agrium EBITDA (net of corporate costs) and applying a percent allocation based on brokers that forecast 2013E

EBITDA by segment / nutrient; percent allocation is as follows: 40% Nitrogen / Other; 10% Phosphate; 15% Potash; 35% Retail

5.

Nitrogen

/

Other

multiple

based

on

CF;

Potash

multiple

based

on

average

of

Potash

Corp

and

Intrepid;

Phosphate

multiple

based

on

PhosAgro

and

Mosaic

less

0.5x

6.

Other includes AAT and Distribution / Resale

7.

On a gross basis, Potash Corp trades at 9.4x 2013E EBITDA and net of its unconsolidated equity investment portfolio (SQM, ICL, APC, Sinofert) it trades at 7.4x;

In

our

sum-of-the-parts

analysis

we

have

conservatively

used

the

gross

multiple

of

9.4x;

Use

of

the

adjusted

multiple

of

7.4x

would

reduce

the

implied value of Wholesale and further raise the implied multiple we are receiving for Retail within Agrium

•

A break up would destroy value, rather than create it, even before consideration of

dis-synergies and other risks related to splitting the Company

•

Retail is worth more as a part of Agrium and receives over a 9x EBITDA multiple within

Agrium, based on median analyst estimates and actual trading multiples of our Wholesale

peers

•

If Wholesale were to be valued at 5x within Agrium (e.g., a half-turn closer to a nitrogen

multiple of 4.3x), Retail would be currently receiving close to a 10x multiple within Agrium

•

To

create

$20

per

share

of

value,

the

EBITDA

multiple

for

Retail

would

need

to

expand

by

more than 3x

•

JANA

has

provided

no

analysis

to

suggest

how

this

value

could

be

achieved

•

In

its

October

1,

2012

presentation,

JANA

lowered

the

value

of

a

break

up

from

$34

per

share by half to $15 to $20 per share

19

20

9.7x

10.3x

10.6x

10.7x

11.3x

11.9x

9.3x

8.9x

8.9x

8.5x

8.3x

7.2x

0

5

10

15

Reliance

Steel &

Aluminum

MRC

Applied

Industrial

WESCO

Genuine

Parts

Brenntag

Airgas

Grainger

MSC

Industrial

Beacon

Roofing

Watsco

Tractor

Supply

Retail Valued Above Analyst Targets and In-line With

Public Distribution Companies

Analyst

Sum-of-the-Parts

Retail

Multiples

(1)

Source: Capital IQ

1.

Date reflects most recent date of published report including Retail multiple. Excludes analysts that have discontinued coverage

2.

Trading multiples based on February 13, 2013 market data

3.

Estimated

using

methodology

from

11/12/12

report

and

most

recent

price

target

and

2013E

EBITDA

by

segment

4.

Midpoint of SOTP retail multiple range

5.

2014E EBITDA multiple; Unable to imply 2013E due to limited information

6.

Implied by 2014E Retail EBITDA (8.8x for BGC, 8.5x for Dundee and 8.5x for Scotiia)

7.

Heating, ventilation, air conditioning / refrigeration

8.

Maintenance, repair, and operations

9.

Multiple implied by 3 month average share price: 8.6x

Electrical

MRO

(8)

Industrial

Gases

Industrial

MRO

(8)

Oilfield

Services

Metals

Roofing

Materials

Chemicals

Auto

Parts

HVAC/R

(7)

Livestock,

Pet and

Hardware

Industrial

MRO

(8)

Industrial

MRO

(8)

9.5x

10.0x

9.0x

8.9x

8.7x

8.5x

8.5x

8.3x

8.5x

8.0x

8.0x

7.5x

7.5x

7.4x

6.0x

9.0x

10.6x

0

5

10

15

Alta

(10/2/12)

National

Bank

(8/14)

Barclays

(1/30/13)

CLSA

1/31/13

Gabelli

(11/8/12)

UBS

(1/28/13)

RBC

(8/15/12)

BAML

(1/29/13)

BMO

(1/29/13)

GS

(1/28/13)

Scotia

(1/29/13)

Dundee

(1/29/13)

Citi

(1/29/13)

Piper

(12/2/12)

Miller

Tabak

(8/3/12)

SIG

(1/28/12)

BGC

Alta

10/2/12

CLSA

3/1/13

Barclays

(3)

1/30/13   

National

Bank

8/14/12

UBS

2/22/13

RBC

(4)

8/15/12

BAML

2/28/13

GS

1/28/13

Scotia

(6)

2/25/13

Piper

12/2/12

Miller

Tabak

8/3/12

Susq.

2/25/13

BGC

(6)

1/29/13

Dundee

(6)

2/25/13

Citi

(5)

2/25/13

Median: 8.5x

Median: 9.5x

Enterprise

Value

/

2013E

EBITDA

(2)

BMO

(4)

2/24/13

Gabelli

11/8/12

Agrium

Retail

9.2x

(9)

Agrium

Retail

9.2x

(9)

20

•

After spending 7 months listening to JANA, most analysts continue to value Agrium

Retail in the 8x to 9x range, with a median in the mid-8s

•

We are currently receiving a multiple of 9.2x for Retail within Agrium, above the analyst

median and in-line with the public distribution company average

•

On August 2, the Agrium Board's independent advisor, Morgan Stanley, advised there

are no direct peers for Retail in the capital markets today and that the closest public

comp would have been UAP

(1)

, which has not been public for 5 years.  When it was

public, UAP traded at an average EBITDA multiple in the high 8s

•

Because there are no direct comps, Morgan Stanley believes investors would evaluate

a broad universe of distribution companies when considering the trading value of

Retail, including basic materials such as chemicals, materials, and other commodities,

along with industrials such as air conditioning, maintenance, hardware and auto parts

stores

•

JANA initially disputed inclusion of comparables such as Brenntag and MSC

that

Morgan

Stanley

included

in

its

opinion

to

the

Agrium

Board,

yet

JANA

has

since put forward 2 nominees for the Agrium Board from Brenntag and MSC

Notes

1.

UAP went public on 11/22/2004 with a market capitalization of ~$800MM, and remained majority controlled by Apollo at

IPO.  Apollo had previously acquired UAP in an LBO

21

JANA Has Been Wrong Before and Destroyed Value

0

20

40

60

80

100

120

140

7/30/10

10/29/10

1/28/11

5/3/11

8/2/11

11/1/11

2/1/12

5/7/12

8/6/12

11/5/12

2/13/13

Peers

(2)

+28%

1.

Combined share price of TNT Express + PostNL post-separation

2.

Average of selected peers (UPS, FedEx and Deutsche Post)

Source: Capital IQ; Company Filings

TNT +

PNL

(1)

(68%)

AEX

+5%

TNT Express

Separation

5/26/2011

UPS Transaction

Leak 

2/16/2012

UPS Transaction

Announcement

3/19/2012

UPS Transaction

Termination

1/14/2013

Separation

Announcement

8/2/2010

TNT NV

(Pre-Separation)

TNT Express + PostNL

(Post-Separation)

(1)

Relative Trading Performance

Since Day Prior to Announcement of Separation

Indexed to 100

•

JANA’s breakup ideas have destroyed value for shareholders when

adopted in a similar situation

•

For example, JANA successfully pressured TNT, an international express

and domestic mail delivery services company based in the Netherlands, to

break itself into two standalone businesses

•

JANA’s strategy was a clear failure for TNT shareholders, as

evidenced by the 68% decline in shareholder value since the

announcement of the separation, compared to:

–

An increase in value of 28% for a composite of TNT’s peers (UPS,

FedEx and Deutsche Post)

–

An increase of 5% for the AEX Index, a stock market index composite of

Dutch companies that trade on Euronext Amsterdam

21

22

•

JANA had nothing to do with Agrium’s return of capital in 2012

•

Agrium, not JANA, skillfully structured its pending acquisition from

Glencore of the Agri Products business formerly operated by Viterra,

allowing Agrium to return C$900 million of excess proceeds directly to

shareholders through a share repurchase

•

This acquisition is an opportunity that Agrium is uniquely positioned to

capitalize on because of its integrated strategy

•

Agrium began increasing its dividend in 2011 in step with its record

growth in earnings and cash flow and its previously stated strategy. JANA

had nothing to do with our record earnings and cash flow

•

Agrium will continue to grow its dividend and return excess capital to

shareholders

JANA is Contrary to the Facts on Capital Allocation

22

23

JANA is Confused on Costs 

•

Agrium Retail margins have always significantly exceeded margins

of our direct peers in agricultural retail

(1)

•

Retail’s expense ratio of 71%

(2)

is in line with the median of public

distribution companies

•

Retail’s expense ratio has continued to decline as we reduce the

cost structure of acquired companies, focus on continuous

improvement, and leverage our operating network to capture

synergies

•

In 1H 2012, before JANA’s campaign, an independent global

consultancy concluded that Agrium’s G&A costs were in or near

best quartile in all areas

•

JANA’s unspecified proposed SG&A cuts would require elimination

of more than half of our Corporate SG&A, which makes no sense

and would imperil Agrium’s ability to manage its global operations

1.

Royster-Clark and UAP, two companies previously acquired by Agrium, are our closest direct agricultural retail peers

2.

Includes estimated allocation of Corporate G&A. Excluding Corporate G&A would result in an operating expense ratio for Retail of 69%

•

In October, JANA suggested Agrium could cut well over half of its

Corporate SG&A, creating significant value for Agrium

shareholders

•

However the analyst

(1)

working with JANA now suggests JANA got

this wrong and that value would be zero:

–

"Whatever opportunity might exist to cut overhead would be

offset if two separate corporate structures were implemented for

Wholesale and Retail" --

Mark Connelly, CLSA, March 1

Notes

1.

Please see slides 41 to 44 for an in-depth review of Mark Connelly's perspectives

23

24

5.5

8.5

8.9

5.4

5.6

5.4

5.9

8.9

9.2

6.1

8.4

10.2

4.5

7.7

9.0

9.7

5.6

5.3

5.5

0

2

4

6

8

10

12

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

Royster-Clark

(1)

UAP

(2)

AGU North America Retail

(3)

EBITDA Margin (%)

Agrium doubled

Royster’s legacy

EBITDA in 18 mo.

Retail’s Margins Significantly Exceed Ag Retail Peers

2006 margins

impacted by Royster

acquisition

Financial

Crisis

1.

2005 margin based on LTM 1Q2005 data

2.

UAP fiscal period end was February; data shifted to closest calendar year

3.

North America Retail EBITDA margin excludes allocation of Corporate G&A.  Allocating reported corporate G&A would result in EBITDA margins of

8.6% (2005), 5.6% (2006), 7.9% (2007), 8.7% (2011) and 9.3% (2012)

Commodity

Peak

•

There are no direct peers for Agrium Retail in the public markets

because all of its competitors are privately-held companies

•

Agrium has rolled up Royster-Clark, UAP, and many tuck-in

acquisitions (all with EBITDA margins averaging well below 6%) since

2006 and has successfully increased its total North America margins to

over 9%

•

Agrium

Retail

margins

have

always

significantly

exceeded

margins

of

our closest direct agricultural retail peers (Royster-Clark and UAP)

•

JANA has failed to consider, or chosen to simply ignore these facts,

which have always been public

•

JANA continues to refer to a EBIT / GP ratio as a measure of margins. 

It is not, it is another measure of cost efficiency: you can have low

costs and poor margins, something both UAP and Royster Clark had

until we acquired them

24

25

66

60

61

72

72

72

72

73

74

78

71

70

70

71

0

20

40

60

80

100

Airgas

Applied

Industrial

Genuine

Parts

Watsco

WESCO

Beacon

Roofing

Tractor

Supply

Grainger

Agrium

Retail

Brenntag

Reliance

Steel &

Aluminum

MSC

Industrial

MRC

Industrial

Gases

Industrial

MRO

Auto

Parts

Livestock,

Pet and

Hardware

Crop

Protection

and Fertilizer

Electrical

MRO

(2)

HVAC/R

Industrial

MRO

Roofing

Materials

Chemicals

Oilfield

Services

Industrial

MRO

Metals

Operating Expenses In Line With Public Distributors

Median: 72%

Retail Operating Expense / Gross Profit (%)

(2012)

(1)

75

76

71

71

66

76

60

65

70

75

80

2012

2011

2010

Agrium Retail Operating Expense / Gross Profit (%)

(3)

Total

North American Retail

(4)

Source: Capital IQ

1.

Data shown is 2012 except MSC Industrial which is LTM as of 12/1/2012 and Brenntag which is LTM as of 9/30/2012

2.

Includes estimated allocation of Corporate G&A. Excluding Corporate G&A would result in an operating expense ratio for Retail of 69%

3.

Includes estimated allocation of Corporate G&A

4.

North American Retail

•

Agrium Retail’s operating costs to gross profit ratio of 71% is in line with the

median of public distribution companies and has continued to improve as

we reduce the cost structure of acquired companies, focus on continuous

improvement, and leverage our operating network to capture synergies

•

Retail’s overall operating expense ratio has improved by 500 bps

since 2010, including a 900 bps improvement in the North American Retail

business

•

We acquired less efficient companies knowing there was significant

opportunity to improve efficiency

•

As we integrate and realize operating synergies from our acquisitions, our

combined efficiency ratios continue to improve, a fact JANA understands

very well but has chosen to distort in its communications with our

shareholders

25

26

JANA is Careless With Facts on Controls 

•

JANA has based its allegation that Agrium Retail is poorly managed on a flawed

comparison it draws between Agrium Retail and UAP, a company Agrium

acquired in 2008

•

Agrium’s

working

capital

levels

are

lower

than

UAP’s

were

and

our

margins

are

~300bps

higher

even

though

UAP’s

product

mix

(less

fertilizer)

required

less

working capital investment

•

If we ran Retail on the same basis as UAP in 2007, it would destroy over $2.5Bn

of shareholder value

•

Our

entire

management

team

has

a

portion

of

compensation

tied

to

management

of working capital

•

In its misguided "outside-in" assessment of Retail’s facilities, JANA proposed

massive store closures based on naive "back-of-the-envelope calculations" which

fail to consider important factors such as such as geography, the density and

profitability of markets, the needs of growers, and the number and location of

facilities owned by our competitors

•

Agrium has proactively closed 255 carefully selected stores, including 20% of its

U.S. facilities

•

Retail's state-of-the-art systems provide visibility down to single store level,

allowing Agrium to make the right operating and closure decisions

26

27

18

18

17

21

0

5

10

15

20

25

UAP – 2007

AGU NAR – 2007

AGU NAR - 2012

Working Capital to Revenue (%)

UAP’s % on

comparable

accounting basis

(1)

UAP’s Working Capital Ratio Was Higher than Agrium

Retail’s and its Margins Were ~300 bps Lower

Source: Capital IQ

1.

Working

capital

/

sale

figures

calculated

on

a

fiscal

year

basis

and

the

reduction

in

working

capital

to

sales

for

UAP

using

4-4-5

approach

for

2006

and

2007

were 458 bps and 368 bps

•

Contrary to what JANA told Agrium shareholders, Agrium Retail’s

working capital levels for North America are actually lower than

UAP’s were and our margins are approximately 300bps higher (i.e.,

9% margins vs. 6% margins)

•

This is in spite of the fact that UAP had a different product mix than

Agrium (e.g., less fertilizer intensive) that requires less working

capital investment

•

If Agrium ran Retail on the same basis as UAP in 2007, it would

destroy over $2.5 billion of shareholder value

27

28

JANA’s Facility Analysis is Severely Misguided

Air Miles versus Driving Miles

Competitor Analysis: Clarksdale Mississippi

Agrium Retail

1703 Desoto Hwy 49 S

Clarksdale, MS 38614

Helena

829 Desoto Avenue

Clarksdale, MS 38614

Jimmy Sanders

1461 Desoto Avenue

Clarksdale, MS 38614

Green Point AG

1634 Desoto Avenue

Clarksdale, MS 38614

Cumulative Facility Closures

74

88

152

166

233

14

64

14

67

22

255

233

166

152

88

88

74

0

50

100

150

200

250

300

2006

2007

2008

2009

2010

2011

2012

Facility closures in current year

(Count)

•

In

its

misguided

“outside-in”

assessment

of

Retail’s

facilities,

JANA

proposed

massive

facility

closures

based

on

naive

“back-of-the-envelope

calculations”

which

they

claim

show that Agrium’s facilities are “too close together”

•

Agrium

has

proactively

closed

255

carefully

selected

facilities,

including

20%

of

its

U.S. facilities while increasing market share

•

Retail’s state-of-the-art systems provide visibility down to the single-store level,

allowing Agrium to make the right operating and closure decisions

•

Agricultural Retail is a very different business than the industrial “breaking bulk”

companies run by 2 of JANA’s nominees, which feature mail-order catalogues instead

of

client

relationships

and

1,000s

of

SKUs

shipped

by

plane,

train,

and

truck

–

you

cannot distribute fertilizer this way

•

We

are

not

just

a

product

supplier

–

we

have

a

significant

service

component,

including fertilizer blending, application services, agronomic services, consultation, soil

sampling and seed treatment. We also formulate and provide enhanced proprietary

products through Loveland Products that are only available to Agrium Retail customers

•

JANA also fails to consider important factors in rationalizing facilities, such as

geography, the density and profitability of markets, the needs of growers, and the

number and location of facilities owned by our competitors

28

29

Equity Research Analysts Support Agrium

“Jana has raised broad discussion points, albeit with little specific or intimate

knowledge

of AGU Retail in our view, and the burden is on Jana to justify why a

change in course could be needed…”

–

BMO

“we believe management convincingly refuted many of Jana's claims

after

digging into working capital concerns and addressing the need for geographic

density, which is a function of high and low service models…Agrium has the

best in industry ag-retail management team”

–

CIBC

“Overall, we think that Agrium has done a good job of refuting the issues Jana

has presented…

we continue to believe Agrium can maximize its share value as

one company

and that the synergies that would be lost are quite valuable

and

worth preserving.”

–

RBC

“Strong rebuttal by Agrium to JANA: This is the most in depth response Agrium

has made publicly to JANA…We continue to view Agrium as an integrated

company, which was supported by AGU's presentation.”

–

Dundee

•

Following our 4.5 hour Analyst Day on January 28, 2013 in New York,

analysts strongly supported Agrium’s Board and told shareholders that

Agrium crisply refuted JANA’s flawed “5C”

arguments

•

Analysts also continue to say that JANA has not made the case for a break

up

29

30

JANA’s Campaign Has Zero Credibility

30

31

JANA’s Campaign Has Zero Credibility

•

When JANA first contacted Agrium last May, it said it was committed to

private engagement review of its ideas with Agrium

•

However, JANA spent the summer promoting its ideas to our competitors,

PE firms, arbitrageurs, analysts and shareholders in an effort to have the

company

broken

up

and

the

pieces

sold

–

all

before

even

publicly

announcing its campaign

•

In October, JANA then announced that its ideas would create $50 / share,

however, by November, it removed any reference to specific value

creation because its analysis was rejected

•

JANA initially disputed inclusion of comparables such as Brenntag and

MSC proposed by Morgan Stanley, yet it has since put forward 2

nominees for the Agrium Board from Brenntag and MSC

•

JANA tried to convince shareholders that Retail is valued close to 6x

EBITDA within Agrium instead of the 9x based on the sum-of-the-parts

analysis

•

On February 7, JANA proposed never-before-seen “valuation deductions”

previously made by zero of the 29 analysts covering our stock

31

•

By taking a leadership role with the formulation of JANA’s misguided and

flawed analysis, participating with JANA on countless investor roadshows

and

agreeing

to

receive

special

compensation

directly

from

JANA,

all

of

JANA’s dissident nominees:

–

Are tied to JANA’s flawed arguments

–

Have zero credibility

–

Lack the ability to think and act independently of JANA’s ideas, which

would destroy shareholder value

32

JANA’s Campaign Has Zero Credibility (cont’d)

•

Days after reneging at the last minute on a settlement for 1 director, JANA immediately

mischaracterized the nature and substance of the talks

•

Two

weeks

later,

JANA

said

Agrium

shares

declined

12%

because

of

an

"entrenchment

discount", despite the fact that Agrium declined in line with peers over the same time

period on fundamentals

•

JANA also declared one of Agrium's new directors is not independent because he

received

C$30MM

from

Agrium

which,

as

a

matter

of

public

record,

is

completely

false

•

JANA has since resumed parading around its 5-member, so-called “dream-team”

dissident slate yet it is asking shareholders to appoint 1 or 2 of its nominees, because it

says Agrium lacks independent directors with distribution experience and shareholder

focus

•

Agrium appointed 2 highly qualified directors with the very experience JANA says

Agrium needs

•

Meanwhile, the boards of JANA's own distribution nominees (MSC, Brenntag) have less

distribution experience than Agrium’s and the MSC Board is fraught with conflicts (e.g.,

JANA’s nominee controls 66% of the votes with only 26% of the economics)

•

Finally, JANA is on the road meeting with shareholders chaperoned by CLSA, the same

conflicted analyst that JANA quotes more than a dozen times in its materials about

Agrium

32

33

Proposed Value Creation from a Break Up of the Company

JANA’s Theory #1

July 11, 2012

JANA’s Theory #2

October 1, 2012

Change

JANA’s Theory #3

January 23, 2013

JANA’s Theory #4

February 7, 2013

Spin-off Retail

~$28

$15 –

$20

< $8 –

$13>

Spin-off Potash

~$6

–

<$6>

Sub-total

~$34

$15 –

$20

<$14 –

$19>

Proposed Value Creation from Operating / Capital Cuts

Rationalize Costs

$8

$20

+$12

Capital Allocation

and Working Capital

$9

$10

+$1

Sub-total

$17

$30

+$13

Total Theoretical Value

Creation

$51

$45 –

$50

<$1

–

$6>

Despite its “Switcheroo”, JANA’s Ultimate Objective Remains a Break Up

JANA’s Value Creation “Switcheroo”

33

•

JANA’s value creation thesis has been an on going “switcheroo”

•

In July, JANA asked our Board to break up Agrium into 3 pieces based on the highly

contrived

view

that

this

would

create

monumental

value

for

shareholders

–

~$34

per

share

•

After realizing our shareholders disagreed with JANA’s valuation, JANA began to

significantly change its arguments

•

On

October

1,

JANA

reduced

the

value

of

a

break

up

by

about

half

(down

$14

to

$19

per

share)

and

effectively

back

filled

this

reduction

by

further

inflating

the

upside

from

cutting

costs

by

150%

or

an

additional

$12

per

share

–

“The

JANA

Switcheroo”

•

After realizing our shareholders still disagreed with JANA, it simply removed all

the value creation figures from its materials

•

On November 19, when JANA announced its Board nominees, it was careful to

remove

any

reference

to

the

$50

of

total

upside

it

touted

only

7

weeks

earlier

from

its

filings

•

In its January 23 and February 7 filings, JANA continued to exclude value from a break

up and did not present a specific view of the value that might be created from pursuing

any of its ideas

34

•

In its February 7, 2013 presentation (slides 21-22), JANA prepared perhaps

its most flawed and troubling analysis to date by manufacturing never-before-

seen adjustments to suggest we receive a low value for Agrium Retail

•

However, as explained below, JANA double counted in its analysis

•

Even under JANA’s flawed analysis, we are still receiving over 9x for Retail

JANA's Deeply Flawed Sum-of-the-Parts Analysis

$ billion, unless otherwise noted

Potash Corp

Mosaic

CF

Total Expansion Investment

7.4

6.3

3.8

Illustrative Return on Investment

11%

11%

11%

Implied

Run-rate

(2017E)

EBITDA

From

Expansion

(1)

1.5

1.3

0.8

Expansion Valuation Multiple

8.0x

8.0x

4.5x

Present

Value

of

Expansion

Project

(2)

7.7

6.6

2.5

Adjusted

2013E

EBITDA

Multiple

(3)

7.6x

5.5x

3.6x

Current

2013E

EBITDA

Multiple

(4)

9.4x

7.5x

4.4x

Difference (Adjusted Multiple –

Current Multiple)

(1.8x)

(2.1x)

(0.8x)

Assumes 20 year depreciation and 26%, 27% and 35% tax rate for Potash Corp, Mosaic and CF, respectively

Future value of expansion projects discounted back 4 years (from 2017 to 2013) at 11%

(Current enterprise value less present value of expansion project) / 2013E EBITDA; market data as of February 13, 2013

On a gross basis, Potash Corp trades at 9.4x 2013E EBITDA and net of its unconsolidated equity investment portfolio (SQM, ICL, APC, Sinofert) it trades at 7.4x; 

In our sum-of-the-parts analysis we have conservatively used the gross multiple of 9.4x; Use of the adjusted multiple of 7.4x would reduce the implied value of

Wholesale and further raise the implied multiple we are receiving for Retail within Agrium

1.

2.

3.

4.

34

•

In JANA's February 7, 2013 presentation (slides 21-22), it prepared what is

perhaps its most flawed and troubling analysis to date

•

Rather than prepare its own sum-of-the-parts analysis based on actual peer

trading multiples and consensus analyst estimates, it manufactured several

flawed

and

contrived

adjustments

to

Wholesale's

trading

value

in

an

effort

to suggest Retail is receiving a very low value within Agrium

•

The largest error in JANA's analysis is that it has ADDED what it believes is

the

value

of

our

Vanscoy

potash

expansion

project

to

the

current

trading

value of Wholesale

•

However, all of our key peers have large capacity expansion projects

underway as well

•

JANA, of course, did not make this adjustment to our peers (shown in the

table above), so it effectively double counted the value of the project

•

Valuing our existing business at "project adjusted" multiples for the peers

and adding the theoretical value of Vanscoy suggests we are still receiving

over 9x in our stock for Retail

35

Zero Out of 29 Analysts Follow JANA's Flawed Methodology

1.

SOTP analysis is employed but is not a primary valuation methodology

2.

On February 25, CLSA analyst Mark Connelly reported for the first time that he also makes a number of the adjustments that JANA suggests

Broker

Analyst

Performs Sum-of-the-Parts

Valuation Analysis

Made JANA’s Vanscoy

Adjustments

Makes the Other Adjustments

Proposed by JANA

AltaCorp

John Chu

Yes

(1)

Atlantic Equities

Colin Isaac

BAML

Kevin McCarthy

Yes

Barclays

Matthew Korn

Yes

BGC

Mark Gulley

Yes

BMO

Joel Jackson

Yes

Canaccord

Keith Carpenter

CIBC

Jacob Bout

Citi

P.J. Juvekar

Yes

CLSA (Credit Agricole)

Mark Connelly

Yes

Introduced on Feb. 25

(2)

Credit Suisse

Chris Parkinson

Dahlman Rose

Charles Neivert

Desjardins

John Hughes

Dundee

Carolyn Dennis

Yes

Gabelli

Amon Wilkes

Yes

Goldman Sachs

Adam Samuelson

Yes

JP Morgan

Jeffrey Zekauskas

Macquarie

David Pupo

Miller Tabak

Tim Tiberio

Yes

(1)

Morningstar

Jeffrey Stafford

National Bank

Robert Winslow

Yes

(1)

Piper Jaffray

Michael Cox

Yes

(1)

RBC

Adam Schatzker

Yes

(1)

Salman Partners

Raymond Goldie

Scotiabank

Ben Isaacson

Yes

Stifel Nicolaus

Paul Massoud

Susquehanna

Don Carson

Yes

TD Securities

Paul D’Amico

UBS

Brian MacArthur

Yes

Performs Analysis

Does NOT Perform Analysis

35

•

After having corrected JANA’s never-before-seen analysis, it is also worth noting

that zero out of 29 analysts covering our stock today separately

value or adjust

their trading valuations for the value of our Vanscoy expansion project

–

With one exception: on February 25, two weeks after JANA published this

new analysis and on the same day he was hosting JANA at a breakfast to

promote JANA’s so-called “dream team,”

Mark Connelly of CLSA announced

for the first time that he also makes the Vanscoy adjustment suggested by

JANA

–

No other analysts adopted JANA’s flawed approach

•

JANA either does not understand how to value assets in our sector or it is

intentionally trying to deceive shareholders because it has been

unable to

convince anyone that its plan to break up Agrium would create value for

shareholders

•

On February 19, 2013, Agrium filed investor materials titled “Supplemental

Valuation Materials Regarding JANA”, which is available on Agrium’s

website.  Please see these materials for a more in-depth review of JANA’s

most recent flawed analysis

36

•

On February 11, 2013, Barry Rosenstein reneged on an

agreement he made with Michael Wilson the morning before

•

That agreement was based on three principles:

1.

JANA would get 1 board seat, a mutually identified

candidate

first

approved

by

JANA,

or

1

of

its

nominees

2.

JANA would end its entire campaign and agree to a

standstill until the close of the 2014 Annual General

Meeting

3.

JANA and Agrium would issue a joint press release

JANA Mischaracterized Settlement Agreement With Agrium

36

•

On February 25, 2013, Agrium filed “Setting the Record Straight”, which

is available on Agrium’s website and in Appendix A.  The filing provided

details on the recent discussions with JANA, along with the settlement

agreement and draft joint press release.  Agrium made these available

because JANA has continued to mischaracterize its settlement discussions

with Agrium

37

•

“Agrium’s new

management-approved

directors and

entrenchment efforts were

followed by a 12% decline

in its stock price…”

•

“…the market’s

overwhelmingly negative

reaction to [Agrium’s] new

directors”

–

JANA, February 25, 2013

JANA is Misleading Shareholders About Stock Movements

(13)

(17)

(12)

(8)

(8)

(20)

(15)

(10)

(5)

0

IPI

CF

AGU

POT

MOS

Relative Share Price Performance

North American Fertilizer Peers

February 11 to February 25, 2013

(%)

Average Peer Decline: 12%

37

•

JANA has misrepresented the facts relating to Agrium's recent share price

performance

•

In public statements by JANA and Mr. Rosenstein on February 25, 2013, JANA

attributes the recent move in Agrium's share price to dissatisfaction with the 2

new directors appointed to the Agrium board

•

Of course, JANA fails to mention that Agrium shares simply moved

in line with

the average North American fertilizer peer for the two weeks ended February 25

•

In particular, sector valuations were influenced by the USDA's February 21,

2013 report predicting a large corn crop along with a sector downgrade by

Dahlman Rose on February 22, 2013

•

"The USDA projected a significant rebound in corn production and

ending

stocks in 2013/14 at its 2013 Agricultural Outlook last week. Since reaching

$6/bu in late January, [corn] prices have continued to sell off,

most

recently approaching $5.50/bu.  Shares of all fertilizer producers appear to

be responding negatively to the USDA’s 2013 forecast for 96.5mln U.S.

corn acres"

–

Susquehanna 2/26/13

38

•

“Agrium’s new directors lack sufficient

independence”

•

“One of these directors, former Viterra CEO Mayo

Schmidt, received C$30 million when Agrium

acquired Viterra’s distribution business”

JANA is Making False and Misleading Statements to

Deceive Shareholders

–

JANA, February 25

38

•

In an attempt to promote its dissident slate, JANA has misrepresented the

facts relating to Glencore’s acquisition of Viterra, implying that Mr. Schmidt

received payments from Agrium

•

This is simply false

•

Mr.

Schmidt

received

payments

directly

from

Glencore

and

Viterra

in

relation to Glencore’s acquisition of Viterra, which closed in 2012. Agrium

had no direct dealings with Viterra

•

Glencore agreed to sell Viterra’s agri-products assets to Agrium after

closing its deal with Viterra. This transaction is expected to close later this

year

•

Mr. Schmidt did not receive and will not receive any monetary benefit from

Agrium in relation to these transactions

•

JANA is misrepresenting the facts in an attempt to deceive Agrium

shareholders

39

JANA’s So-Called “Dream Team”

Boards Lack

Distribution Experience

1.

Current / former executive of BC Partners, recent 100% private equity owner of Brenntag

MSC Industrial

Director

Affiliation

Mitchell

Jacobson

Insider

Erik Gershwind

Insider

David Sandler

Insider

Jonathan Byrnes

Independent

Director

Roger Fradin

Independent

Director

Louise Goeser

Independent

Director

Denis Kelly

Independent

Director

Phillip Peller

Independent

Director

Brenntag

Director

Affiliation

Stefan Zuschke

Insider

(1)

Doreen Nowotne

Insider

(1)

Stephen Clark

Insider

Dr. Thomas

Ludwig

Independent

Director

Dr. Andreas

Rittsteig

Independent

Director

Dr. Edgar Fluri

Independent

Director

UAP

Director

Affiliation

L. Kenneth Cordell

Insider

David Birk

Independent

Director

Michael Ducey

Independent

Director

Steven Gold

Independent

Director

Thomas Miklich

Independent

Director

Carl Rickertsen

Independent

Director

William

Schumann, III

Independent

Director

Scott Thompson

Independent

Director

Denotes Independent Director with retail / distribution experience

Mitchell Jacobson

Stephen Clark

David Bullock

Agrium

Director

Affiliation

Michael M. Wilson

Insider

Ralph S.

Cunningham

Independent

Director

David Everitt

Independent

Director

Russell K. Girling

Independent

Director

Dr. Susan A. Henry

Independent

Director

Russell J. Horner

Independent

Director

David J. Lesar

Independent

Director

John E. Lowe

Independent

Director

The Honourable

Anne McLellan, P.C.

Independent

Director

Derek G. Pannell

Independent

Director

Frank W. Proto

Independent

Director

Mayo Schmidt

Independent

Director

Victor J. Zaleschuk

Independent

Director

Insiders

JANA’s So-Called “Distribution Dream-Teamers”

39

•

JANA suggested the independent directors of Agrium lack the experience to oversee

management of Retail, so it nominated 3 directors with distribution experience

•

MSC,

Mitchell

Jacobson's

company,

a

distribution

pure

play,

has

directors on its board with executive experience running distribution companies

•

Brenntag,

Stephen

Clark's

company,

a

distribution

pure

play,

has

only 1 independent

director on its board with executive experience running distribution companies

•

At the time when Agrium acquired UAP, a distribution pure play (and David Bullock's

former company), UAP only had 1 independent director on its board with executive

experience running distribution companies, who was a lawyer (general counsel), not

an operator

•

With David Everitt and Mayo Schmidt, the Agrium Board has a 2 independent directors

with extensive agricultural distribution experience and has a higher proportion of independent

directors

with

retail

experience

than

the

so-called

“dream

team”

boards

•

Mr. Everitt brings in-depth knowledge of marketing, distribution and procurement in the

agricultural sector, obtained during his 37 year career at John Deere

•

Mr. Schmidt is widely recognized for leading Viterra's transformation from a small, regionally

based cooperative into Canada's largest agricultural inputs retailer and a leading global

agricultural

and

food

ingredients

company.

With

a

network

of

263

agricultural

retail

locations,

Viterra was the only publicly-traded agricultural retailer of fertilizer, crop chemicals and seed

in North America, other than Agrium

Fact:

0 independent

Fact:

Fact:

Fact:

40

MSC Board: Not So Independent and Shareholder Focused

•

While JANA touts that its nominee Mitch Jacobson is a beacon of good

governance, consider these facts:

–

Mitch

Jacobson

inherited

a

business

from

his

father

which

became

MSC

Industrial Direct Co., Inc. (MSC)

–

MSC, a NYSE-listed company, has a board of directors comprised of 8

members

•

3 of the 8 directors of MSC are insiders

•

Of

the

5

remaining

“independent”

directors,

3

are

senior

executives

of

companies which are either customers and/or suppliers of MSC

•

The

current

CEO

of

MSC

is

also

Jacobson's

nephew

–

so

much

for

an

independent board and management

–

And it doesn’t stop there –

Jacobson, his nephew and his sister together

control 66% of the voting power of MSC while only holding 25.6% of the

common shares of the company

40

41

JANA’s So-Called “Dream Team”

Chaperoned by

Conflicted Analyst

41

•

Despite conducting settlement talks for 1 director, JANA has resumed

its

push

to

have

its

5

nominees

–

the

so-called

“dream

team”

–

elected

to the Agrium board in an effort to break up Agrium

•

The analyst from CLSA (1 of 29 analysts covering Agrium stock) has

aligned himself with JANA and its so-called “dream team”

•

Since JANA started its campaign against Agrium, JANA has quoted the

analyst from CLSA more than a dozen times in its press releases,

presentations and filings

•

But it does not stop with CLSA crafting sentences to be quoted the next

day in JANA’s propaganda, the analyst from CLSA is actually

hosting JANA on investor roadshows.  Most recently he

chaperoned

the

so-called

“dream

team”

through

Toronto

on

March 1, 2013

42

Alone On An Iceberg

•

By total happenstance, Mark Connelly published a new JANA manifesto on March 1,

the

same

day

he

was

chaperoning

JANA's

so-called

“dream

team”

around

Toronto

•

Connelly suggests that the difference between JANA winning and losing the election is

$60 per share or $9.5 Billion of shareholders value, driven primarily by a completely

new

set

of

ideas

--

so

yet

another

“JANA

Switcheroo”

•

Over the coming days we expect JANA to once again liberally quote potential examples

from Connelly’s March 1 report:

•

“We see upside comfortably beyond $150 if the JANA slate wins, and initial downside to

about $90 if the Agrium board is re-elected”

•

“If the JANA nominees are elected, we think a separation of Retail would be likely...And

how likely would an actual separation be? We'd guess over 80%”

•

“…the pace of change, and the potential upside will likely be far great if we get a new

Board”

•

“How many senior management changes? Much too soon to say...People changes

come after you figure out who is on board with a new plan”

•

“…using its size to call for a special shareowner meeting, JANA may well have the size

and

inclination...should

it

lose

[the

annual

meeting]

by

a

small

margin”

•

“…if

JANA

loses

by

a

wide

margin,

then

the

selling

pressure

on

the

stock

is

likely

to

take a while to abate”

42

43

Before the CLSA Analyst’s “Switcheroo”

A Long History of Advising Shareholders that JANA is Wrong on Every One of its Flawed “C’s”

Mark Connelly’s 2009-2012 Comments on Conglomerate Structure

•

Agrium

is

already

showing

its

defensive

strengths.

Retail

keeps

growing,

and

appears

to

have

little

competition

(3/20/12)

•

Agrium's

retail

delivered

the

very

strong

results

that

investors

should

expect…

we

expect

that

performance

to

continue

(11/4/11)

•

[Retail]

is

adding

value

on

multiple

fronts…

the

acquisition-machine

keeps

growth

going

at

relatively

low

cost

(8/4/11)

•

Agrium’s

appeal

is

that

it

doesn’t

have

the

earnings

volatility,

while

Retail

brings

relatively

steady

growth.

We

think

that

mix

remains

attractive

(5/4/11)

•

Agrium’s

balanced

mix

of

nutrients

and

retail

appeals

to

a

range

of

investors

(2/9/11)

•

We

like

the

strong

cash

generation

and

stability

of

the

retail

business,

which

provides

some

hedge

to

commodity

price

volatility

(2/10/10)

•

Retail

significantly

strengthens

Agrium’s

portfolio,

and

adds

upside,

rather

than

simply

diversification

(8/6/09)

Mark Connelly’s 2009-2012 Comments On Capital Allocation

•

Agrium’s

purchase

of

Viterra’s

Agri-products

business

fits

neatly.

[W]e

estimate

the

deal

to

be

accretive

(3/20/12)

•

Agrium

has

put

together

a

compelling

M&A

record

in

retail

(2/8/12)

•

Retail

acquisitions

are

highly

accretive,

and

we

expect

to

see

more,

keeping

the

top

line

growing

(11/4/11)

•

The

reputation

for

capital

discipline

is

well

deserved

(2/9/11)

•

By bringing those smaller retailers into the Agrium (or UAP) model, Agrium can meaningfully boost the range of products offered,

reduce

cogs,

and

raise

margins

at

a

relatively

fast

pace,

as

it

has

done

with

Royster-Clark

and

other

deals

(5/18/10)

•

“Careful

capital

allocation”

and

“basic

materials”

are

rarely

put

together

in

the

same

sentence...Agrium

is

a

clear

and

compelling exception

(5/18/10)

•

Royster-Clark acquisition showed that Agrium could execute M&A in retail, and the UAP deal has delivered clear and compelling

value

(6/11/09)

43

•

In promoting JANA’s case, Mark Connelly has not only accepted

their flawed analysis, he has contradicted everything he said

about Agrium from 2009 through mid-2012

•

Mark Connelly consistently heaped praise on the Agrium Board and

management team for excelling in the very same areas where CLSA

and

JANA

now

say

Agrium

has

performed

poorly

–

JANA’s

flawed

"5Cs"

•

We encourage shareholders to review the published remarks shown

above from Mark Connelly during 2009 through mid-2012, shown

above and on the next slide, so that shareholders, the media, proxy

governance firms and others can draw their own conclusions

44

Before the CLSA Analyst’s “Switcheroo”

(cont’d)

A Long History of Advising Shareholders that JANA is Wrong on Every One of its Flawed “C’s”

Mark Connelly’s 2009-2012 Comments On Costs

•

Agrium’s

knowledge

of

the

Canadian

landscape

will

likely

make

realizing

synergies

there

easier

(3/20/12)

•

Synergies

Agrium

promised

came

relatively

quickly,

and

we

are

well

past

those

targets

now

(8/4/11)

•

Agrium

value-added

retail

model

will

be

increasingly

valuable

over

the

next

decade,

as

farming

decisions

become

even

more

complex

(6/11/09)

Mark Connelly’s 2009-2012 Comments On Controls

•

Wholesale is

performing well on all fronts...a big retail presence helps on all fronts. We doubt Agrium will stray far from its growth

strategy

(2/8/12)

•

Today’s

results

serve

to

remind

us

that

Agrium

is

not

only

good

at

growing

retail,

but

at

improving

and

running

what

it

buys

(2/9/11)

Mark Connelly’s 2009-2012 Comments On Corporate Governance

•

Agrium

tends

toward

the

conservative,

which

is

probably

the

best

investors

can

hope

for

(5/9/12)

•

We

see

no

real

issues

at

all

on

the

Agrium

side

-

Agrium

is

a

well-respected

Alberta-based

nutrient

producer

with

exceptionally

deep roots in Canada

(3/20/12)

•

We

aren’t

sure

why

anybody

is

surprised

to

see

Agrium

guiding

cautiously

in

2Q

–

that

is

the

only

prudent

thing

to

do

(5/4/11)

•

Agrium’s

investor

appeal

is

its

penchant

for

managing

conservatively

(5/4/11)

•

Letting

CF

go

while

completing

two

attractive

retail

deals

has

burnished

the

company’s

reputation

for

discipline.

Agrium

didn’t

spend

much

in

the

attempt,

and

consequently

burnished

its

reputation

for

financial

discipline

and

shareowner

focus

(5/18/10)

•

[W]illingness

to

walk

away

is

a

rare

and

laudable

quality

among

basic

materials

companies

that

is

likely

to

make

investors

even

more

comfortable

with

management

and

the

strategy

(6/11/09)

44

45

Cavalier on Corporate Governance

•

After failing to obtain support for a break up and its other flawed ideas, JANA is now

attacking

the

competency

of

our

Board

and

management

and

asking:

"Why

not

add

1

or

2

of

our guys to the Board?"

•

“Why not?”

–

Because this Board has done an extraordinary job.  Since initiating its

integrated strategy in 2005, Agrium has delivered a return to shareholders of 467%

•

“Why not?”

–

Because Retail is operating extremely well, has created tremendous value

and remains committed to continuous improvement

•

“Why not?”

–

Because JANA’s real agenda has been to break up Agrium into 2 or 3 pieces

in

an

effort

to

see

the

pieces

sold

–

this

and

its

other

ideas

have

always

been

flawed

and

wrong

•

“Why not?”

–

Because JANA’s entire campaign has been filled with ever-changing

arguments, analysis rejected by analysts and most recently deceit

JANA Gets an F For Its “5 Cs”

“Why not?”

–

Because first class, strong performing companies

do not put people on the Board who are committed to impose a

flawed strategy and are part of a campaign that has zero

credibility

45

46

•

Stop the break up of Agrium –

Vote FOR the Agrium

nominees on the WHITE

form of proxy today

•

For more information, Canadian shareholders should

contact CST Phoenix Advisors at 1-866-822-1242 or

email inquiries@phoenixadvisorscst.com

•

U.S. shareholders should contact Innisfree at

1-877-456-3442 or email info@innisfreema.com

•

Proxy Cut-off –

Proxies must be returned

by and no

later than April 5, 2013 at 11a.m. (Calgary time)

Important Proxy Information

46

Appendix A

Setting the Record Straight

47

Setting the Record

Straight

February 25, 2013

48

Setting the Record Straight

•

Agrium has prepared the following materials because JANA is

mischaracterizing its settlement discussions with Agrium

•

On February 11, 2013, Barry Rosenstein reneged on an agreement he

made with Michael Wilson the morning before. That agreement was based

on three principles:

1.

JANA would get one board seat

2.

JANA would agree to a standstill until the close of the 2014 Annual

General Meeting

3.

JANA and Agrium would issue a joint press release

2

49

February 7 Meeting with JANA

•

On February 7, Agrium executives led by Michael Wilson, President and CEO, met with

Barry Rosenstein, Managing Partner of JANA, and several of Mr. Rosenstein’s colleagues

•

The

meeting

was

part

of

an

extensive

investor

roadshow

following

Agrium’s

January

28,

2013 Analyst Day

•

Though

the

meeting

had

been

requested

by

Agrium

and

agreed

to

by

JANA

7

days

in

advance, JANA did not involve any of its director nominees at the meeting (nor had JANA

ever called Agrium to propose a meeting with any of its nominees)

•

Moments before the meeting, JANA issued a press release and new slide presentation

reaffirming its commitment to pursue a break up of Agrium and reiterated several of its

other flawed ideas about Agrium

•

JANA elected to not review or provide a copy of any of the just filed materials with Agrium

during the meeting, and was generally disinterested to hear Agrium’s perspectives

•

The purpose of the meeting was to review Agrium’s business.  Agrium also explained to

JANA why a break up would destroy shareholder value and why Agrium continues to

disagree with JANA’s other ideas about Agrium 

•

During the meeting, Mr. Wilson advised Mr. Rosenstein that Agrium intended to add new

independent directors with retail experience to its Board

3

50

JANA Agrees to Settlement Discussions

•

On

February

8,

Agrium

advised

JANA

that

it

would

be

appointing

2

strong,

uniquely

qualified, independent directors with extensive agricultural, retail, and distribution

experience to its Board

•

In order to determine whether there was a basis for resolution of the proxy battle,

Agrium proposed to appoint an additional, mutually and separately identified

candidate in exchange for a standstill

•

Agrium and JANA both agreed that the mutually identified candidate was highly qualified

•

The candidate was previously approached by JANA but declined to serve as a dissident

nominee

•

The candidate agreed to accept the new appointment but only if the proxy contest was

terminated and if JANA agreed to withdraw its activist campaign

•

On

February

9,

JANA

advised

Agrium

that

it

would

demand

that

the

Company

revisit

the

issues that had been the subject of its activist campaign

•

During the morning of February 10, Michael Wilson explained to Barry Rosenstein again

that the independent directors of the Agrium Board, with the assistance of independent

financial

and

legal

advisors,

had

already

thoroughly

evaluated

a

break

up

of

Agrium,

along with all of JANA's other ideas and the independent directors had unanimously

rejected these ideas

4

51

JANA Agrees to 1 Director

•

In addition during the morning of February 10, Mr. Rosenstein agreed to pursue a settlement agreement

based on the following principles:

1.

JANA

to

appoint

either

the

mutually

identified

candidate

OR

one

of

its

nominees,

along

with

the

appointment of the two new independent directors by Agrium

2.

JANA

agrees

to

a

standstill,

whereby

it

would

cease

pursuit

of

a

break

up

of

Agrium,

along

with

all

of

its

other

activist

initiatives,

until

the

close

of

Agrium's

2014

annual

general

meeting

of

shareholders

3.

JANA and Agrium would prepare and issue a joint press release before markets opened on February

12

–

These principles also were provided to JANA in writing where Agrium indicated agreement by JANA

was a prerequisite for further discussions

•

During the afternoon of February 10, JANA accepted these principles and agreed to pursue negotiation of

a settlement agreement and joint press release, subject to the identification of the Agrium appointees and

agreeing to the language in the joint press release.  Immediately following JANA’s agreement, Agrium

provided the names of its 2 directors

•

JANA did not require further review of a break up of Agrium or any of its other activist initiatives in order

to agree to a settlement

•

During the evening of February 10 through the afternoon of February 11, counsel representing JANA and

Agrium worked together to finalize the settlement agreement and joint press release (attached in the

pages

that

follow).

A

list

was

prepared

of

informational

matters

(1)(2)

to

be

confirmed

during

a

telephone

conversation with Michael Wilson and Barry Rosenstein scheduled for 3:00pm EDT on February 11

Notes

1.

Treatment of compensation arrangement for JANA's nominee, confirmation of the number of directors retiring from the Agrium Board, JANA understands that it would not be in

the

agreement

but

would

like

an

understanding

of

what

committees

the

new

directors

would

join,

negotiation

of

a

non-disparagement

carve

out

for

JANA,

name

of

the

director

that JANA wished to nominate

2.

Agreement on final language for press release, which is observable in the draft press release on the pages that follow

5

52

JANA Reneges

•

During the scheduled call with Michael Wilson, Barry Rosenstein changed

the deal by demanding 2 seats on the Agrium Board

•

Michael Wilson advised Barry Rosenstein that the offer of 1 director was

solely made to put an end to this distraction for shareholders

•

Agrium said it would proceed with the appointment of its 2 new,

independent directors and terminated discussions

•

In order for shareholders to have full clarity on the talks, Agrium is making

the following documents available to shareholders on the pages that follow:

1)

The settlement agreement (as of 3:00pm on February 11)

2)

The joint press release (as of 3:00pm on February 11)

6

53

AGREEMENT

THIS AGREEMENT (“Agreement”), dated as of February [    ], 2013 is entered into between Agrium Inc., a corporation governed by the laws of Canada (the “Company”) and JANA Partners LLC (together with its controlled affiliates, including funds it manages, “JANA”).

1.1 Appointment of Nominees

By no later than 11:00pm on February 11, 2013, the board of directors of the Company (the “Board”) shall have appointed Messrs. Mayo Schmidt, David Everitt and [                    ] (each, a “Nominee”) to serve on the Board from and after the date hereof, and each Nominee shall be nominated by the Company as a director at the annual meeting of shareholders of the Company to be held in 2013 (the “2013 Annual Meeting”).

[JANA represents and warrants that the Nominee Agreement (as defined in the Schedule 13D (the “13D”) filed November 19, 2012 by JANA Partners in respect of its ownership of Common Shares) has been terminated as of the date hereof without any further force or effect, and that neither any First Profit Participation Amount, Second Profit Participation Amount (each as defined in the 13D) nor any other compensation, incentive or otherwise, shall be payable to [                    ] by JANA.]

1.2 Covenants

(a) JANA agrees to immediately cease all solicitation activities relating to the 2013 Annual Meeting, including removing its website relating to the campaign against Agrium and all related activities.

(b) JANA agrees with the Company that during the Restricted Period (as defined below), at the 2013 Annual Meeting, it shall, and shall cause each of the directors, officers, partners, members, employees and agents (acting in such capacity) of JANA (collectively, “Representatives”), to vote, or provide its consent with respect to, all of the Common Shares beneficially owned or over which control or direction is exercised by it for each of the Company’s nominees for election to the Board, provided that such nominees are either Nominees or current members of the Board as of the date hereof.

(c) JANA agrees with the Company that during the Restricted Period it shall not, and shall cause each of its Representatives not to, in any manner, directly or indirectly, alone or by participating in a “group” (within the meaning of Section 13(d)(3) of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”)) or by acting jointly or in concert (within the meaning of applicable Canadian securities laws) with one or more individuals, corporations, partnerships, limited liability companies, joint ventures, estates, trusts, associations, organizations or any other entity of any kind or nature (each a “Person”):

(i) make, or in any way “solicit”, or participate in, any “solicitation” (as such terms are defined in the CBCA and applicable Canadian securities laws, excluding the exceptions provided in Section 147(1)(b) of the CBCA, Section 67 of the Regulations under the CBCA, paragraphs (a), (b) and (c) of subsection 68(1) of the Regulations under the CBCA and paragraphs (a), (i), (j) and (k) of the definition of “solicit” in Section 1.1 of National Instrument 51-102 – Continuous Disclosure Obligations of the Canadian Securities Administrators) of proxies or consents with respect to the voting of any Common Shares; provided, however, that nothing in this Section 2.1(b)(i) shall prohibit a Nominee from soliciting proxies or consents on behalf of management of the Company in his capacity as a director of the Company for proposals or actions made at the direction of the Board;

(ii) make or be the proponent of any shareholder proposal, whether pursuant to Section 137 of the CBCA or otherwise (provided that nothing herein shall be deemed to prohibit or otherwise prevent the Nominees from making any proposal within the context of private meetings or discussions of members of the Board);

(iii) (1) requisition, call or seek to call a meeting of shareholders of the Company including by way of application to any court, (2) seek representation on the Board, except as set forth herein, or (3) seek the removal of any member of the Board;

(iv) request the Company or any of its directors or officers, directly or indirectly, to release JANA from, amend or waive, or otherwise take any action that is inconsistent with any provision of this Agreement, including without limitation any action which would reasonably be expected to require the Company to make a public announcement regarding any such actions.

(d) Nothing in this Section 1.2 shall limit any action that may be taken by a Nominee acting as a director of the Company that is required in order for such Nominee to fulfill his fiduciary duties to the Company.

(e) No Nominee shall be removed during the Restricted Period. No other directors will be appointed during the Restricted Period other than to fill vacancies (unless by doing so the size of the Board would be larger than 13, other than in connection with a business combination or similar transaction) and the Board will not increase in size, other than in connection with a business combination or similar transaction. The Nominees will be recommended for election by the Board at the 2013 and 2014 annual meetings and the Company will use reasonable best efforts to support their election at each such meeting. [If at any time during the Restricted Period [the third nominee’s name] is or becomes unable to serve as a nominee or, following such person’s appointment or election, as a director of the Company, due to death, physical or mental incapacity, JANA

- 2 -

shall be entitled to appoint a replacement nominee or director, as the case may be; provided, that such replacement nominee or director, as the case may be, shall be subject to the approval of the Governance and Nominating Committee of the Company’s Board (such approval not to be unreasonably withheld), it being agreed and understood that any such replacement nominee or director, as the case may be, shall be deemed to be a Nominee for the purposes of this Agreement.]

1.3 Termination

The provisions of this Agreement shall remain in full force and effect through the Restricted Period. For purposes of this Agreement, “Restricted Period” means the period commencing on the date hereof through the earlier of (i) the close of the annual meeting of shareholders of the Company in 2014 and (ii) June 30, 2014.

1.4 Effect of Termination

Notwithstanding Section 1.3, the provisions of this Section 1.4 shall survive the termination of any of the provisions this Agreement. No termination pursuant to Section 1.3 shall relieve any party hereto from liability for any breach of this Agreement prior to such termination.

1.5 Press Release and Other Public Disclosures

(a) Immediately following the execution and delivery of this Agreement, the Company shall issue the press release attached hereto as Schedule A (the “Press Release”). None of the parties hereto shall (a) make any public statements (including in any filing with the Canadian securities regulators, the U.S. Securities and Exchange Commission (the “SEC”) or any other regulatory or governmental agency, including any stock exchange) covering the subject matter of the Press Release that are inconsistent with, or otherwise contrary to, the statements in the Press Release issued pursuant to this Section 1.5 or (b) except as required by law, issue or cause the publication of any press release or other public announcement with respect to the matters that are the subject of this Agreement, without the prior written consent of the parties hereto. The parties acknowledge that the Company will file a copy of this Agreement on SEDAR and with the SEC on EDGAR, and that JANA will file a copy of this Agreement with the SEC on EDGAR together with an amendment to the 13D.

(b) During the Restricted Period, neither JANA nor the Company shall, with respect to one another, say, publish, or communicate (including, without limitation, any “not-for-attribution” statement made or caused to be made, directly or indirectly, to any member of the media, press, analysts or proxy advisory firm), in any media, filing with any governmental agency or other forum, any matter or thing that would reasonably be expected to undermine, disparage or reflect adversely on the reputation, qualifications, character, conduct, performance or behaviour of such other party or its subsidiaries or any of their respective directors, officers,

- 3 -

employees, agents or representatives in connection with any matter arising out of or relating to such other party or its subsidiaries or any of their respective directors, officers, employees, agents or representatives[, provided that, for the avoidance of doubt, objective statements reflecting the Company’s or JANA’s views, as a business matter, with respect to factual matters concerning the Company or JANA arising after the date of this Agreement and outside of the subject matter of the Press Release in response to unsolicited requests from members of the press or analysts shall not be prohibited (it being understood that this proviso does not permit the request or receipt of a form of written proxy or written consent).]

1.6 Governing Law

This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York. Each party hereto agrees, on behalf of itself and its affiliates, that any actions, suits or proceedings arising out of or relating to this Agreement or the transactions contemplated hereby will be brought solely and exclusively in any state or federal court in New York County in the State of New York (and the parties agree not to commence any action, suit or proceeding relating thereto except in such courts), and further agrees that service of any process, summons, notice or document by U.S. registered mail to a party’s business address will be effective service of process for any such action, suit or proceeding brought against any party in any such court. Each party, on behalf of itself and its affiliates, irrevocably and unconditionally waives any objection to the laying of venue of any action, suit or proceeding arising out of this Agreement or the transactions contemplated hereby, in the state or federal courts in New York County in the State of New York, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an improper or inconvenient forum. Each party irrevocably waives any right to trial by jury.

Each of the parties hereby agrees (and JANA shall cause its Representatives to accept) that service of all writs, process and summonses in any Suit may be made upon such party or Representative by mail to the address as provided in this Agreement. Nothing herein shall in anyway limit the ability of any party to serve any such writs, process or summonses in any other matter permitted by applicable law.

1.7 Entire Agreement

This Agreement constitutes the entire agreement of all the parties and supersedes any and all prior and contemporaneous agreements, memoranda, arrangements and understandings, both written and oral, between the parties, or any of them, with respect to the subject matter hereof.

1.8 Counterparts

To facilitate execution, this Agreement may be executed in any number of counterparts (including by facsimile transmission), each of which shall be deemed to be an

- 4 -

original, but all of which together shall constitute one binding agreement on the parties, notwithstanding that not all parties are signatories to the same counterpart.

1.9 Specific Performance

The parties agree that irreparable damage would occur in the event any of the provisions of this Agreement were not performed in accordance with the terms hereof and that the parties are entitled to an injunction or specific performance of the terms hereof in addition to any other remedies at law or in equity.

[Signature Page Follows]

- 5 -

IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first above written.

AGRIUM INC.
By:
	Name:
	Title:
JANA PARTNERS LLC
By:
	Name:
	Title:

- 6 -

Schedule A

Form of Press Release

Agrium Appoints Three New Independent Directors; Reaches Accord with JANA Partners

DRAFT – PRIVILEGED AND CONFIDENTIAL; PRELIMINARY – SUBJECT TO SUBSTANTIAL REVISION

February [DATE], 2013

CALGARY, Alberta – Agrium Inc. is pleased to announce that it has reached an agreement with JANA Partners on the appointment of three new highly qualified independent directors, Mayo Schmidt, David Everitt and [—] to the Agrium Board.

“We are pleased to have reached an accord with JANA Partners and to welcome three strong, uniquely qualified and independent directors to Agrium’s Board,” said Victor Zaleschuk, Board Chair. “[—] brings extensive experience in industrial distribution. Mayo Schmidt and David Everitt bring extensive agricultural, retail and distribution experience. The addition of these directors will enhance our Board’s long standing commitment to continuous improvement in all aspects of Agrium’s business, including the achievement of its performance goals.”

“We welcome the new members to our Board and look forward to the continuation of our highly successful [integrated] strategy,” said Mike Wilson, President and CEO of Agrium.

As part of the agreement, JANA Partners has agreed to withdraw its proposed slate of director nominees and has entered into a standstill agreement with respect to Agrium until following the company’s 2014 Annual General Meeting. The full text of the agreement will be available at www.sedar.com and http://www.sec.gov/edgar.shtml.

“We are pleased with this result [and believe the Agrium Board will continue to create value for shareholders] or [and have confidence in the Agrium Board],” said Barry Rosenstein, Managing Partner of JANA.

• Mayo Schmidt was President and Chief Executive Officer, and a Director of Viterra Inc., a global agri-business with a network of 263 agricultural retail locations. Prior to its acquisition by Glencore International plc on December 18, 2012, Viterra was the only publicly-traded agricultural retailer of fertilizer, crop chemicals and seed in North America, other than Agrium. During his tenure, Mr. Schmidt developed the vision and strategy to transform the Saskatchewan Wheat Pool from a regional co-operative to Viterra, a $6.1b global business corporation. Canadian Business Magazine recognized his efforts when it named him Chief Executive of the Year in 2009. The hallmarks of Mr. Schmidt’s leadership at Viterra were strong shareholder value creation and growth into new markets, supported by a global intelligence network, a strong financial foundation and a steady focus on operational excellence. Prior to joining Viterra, he was Executive Vice President, Domestic and International Operations, Conagra Foods Inc. Mr. Schmidt is a member of the Canadian Council of Chief Executive Officers (open to the top 150 Canadian corporations), a member of Washburn University’s Board of Trustees and the Lincoln Society, and a contributor to Harvard University’s Private and Public, Scientific, Academic and Consumer Food Policy Group. He also serves on the Board of Directors of the Global Transportation Hub Authority.

• David Everitt recently retired as President, Agricultural Division for North America, Australia, Asian and Global Tractor Sourcing, Turf Products and Technology for Deere & Company of Moline, Illinois. He is intimately familiar with procurement, marketing and distribution in the global agricultural market space. In this role, Mr. Everitt had responsibility for global tractor and crop care products. With Deere & Company since 1975, Mr. Everitt was previously President, Agricultural Division, Europe, Africa, South America and Global Harvesting Equipment Sourcing, Senior Vice President and Managing Director, Region II, Europe, Africa and CIS and Vice President, Region I, Worldwide Agricultural Equipment Division. He is a director of Brunswick Corporation and Harsco Corporation, both of which trade on the New York Stock Exchange, and is also a board member of the National Business Aviation Association, a Washington DC based non-profit industry group.

• [—]

About Agrium

Agrium Inc. is a major Retail supplier of agricultural products and services in North America, South America and Australia and a leading global Wholesale producer and marketer of all three major agricultural nutrients and the premier supplier of specialty fertilizers in North America through our Advanced Technologies business unit. Agrium’s strategy is to grow across the value chain through acquisition, incremental expansion of its existing operations and through the development, commercialization and marketing of new products and international opportunities. Our strategy places particular emphasis on growth opportunities that both increase and stabilize our earnings profile in the continuing transformation of Agrium.

FOR FURTHER INFORMATION:

Investor/Media Relations:

Richard Downey, Vice President, Investor/Corporate Relations

(403) 225-7357

Todd Coakwell, Manager, Investor Relations

(403) 225-7437

Mark Thompson, Analyst, Investor Relations

(403) 225-7761

Contact us at: www.agrium.com