Luc Desjardins – President and Chief Executive Officer Ed Bechberger – Vice President-Specialty Chemicals Wayne Bingham – Executive Vice-President and Chief Financial Officer John Engelen – Vice President, Merger and Acquisition

Joel Jackson – BMO Capital Markets Jacob Bout – CIBC Sarah Hughes – Cormark Securities Steve Hansen – Raymond James Nelson Ng – RBC Capital Markets Patrick Kenny – National Bank Financial Benoit Laprade – Scotia Bank

Well, good morning and thank you. Welcome to Superior Plus 2015 third quarter results conference call.

With me on this morning call is Wayne Bingham, Executive Vice President and CFO; Rob Dorran, Vice President, Investor Relations and Treasurer; John Engelen, Vice President, Merger & Acquisition and Ed Bechberger, Vice President of Specialty Chemicals, I will provide an overview of the third quarter result, the 2016 financial outlook and an update on the Canexus transaction. Overall we were pleased with the Superior performance for the third quarter, as a result were consistent with management expectation and however then the prior year quarter.

Fundamentals within both the energy and CPD business continued to be positive, Specialty Chemicals result were in line with our expectation and guidance provided in the second quarter. Overall our consolidated AOCF for the quarter was $0.20 per share compared to $0.18 in the prior year quarter and in line with our expectations.

AOCF per share for the quarter included Canexus related transaction cost which were approximately $0.01. Before I discuss the result by business, I would like to highlight the impact that foreign currencies having on the comparability of certain aspects of our businesses.

The continued significant weakness of the Canadian dollar, as it relates to the transaction of our U.S. operation into Canadian dollar has been masking some of the operational and financial improvement we have been realizing.

Although, the change in currency are not currently impacted superior, consolidated bottom line as a result of our hedging program, it does impact individual line item in the operating result of the division. Turning now to the individual business result energy service EBITDA from operation was $13.8 million, compared to $4.8 million in the prior quarter.

Supply portfolio management gross profit were $12.2 million, an increase $11 million due to improved procurement initiative, basic differential and market condition. Propane Canada and U.S.

refinery fuel average unit margin were higher due to the reduced wholesale costs of commodity and the benefit for pricing initiatives. Turning to Specialty Chemicals, Specialty Chemicals recorded a third quarter EBITDA of $16.1 million compared to $27.3 million in the prior year quarter and in line with the new management expectations.

Results were lower due to the impact of reduced sodium chlorate volume and continue weakness in hydrochloric acid market. Sodium chlorate volume were 9% lower than prior year quarter, due to a reduction in the North America pulp mills, customer demand and a decrease in the Tronox nominated volume which we have had anticipated.

Chlorate’s volume were 13% higher than the second quarter, as pulp mills customer return to normalized operating rate in the third quarter. Hydrochloric acid pricing continue to be negatively impacted by reduced demand from the oil and gas industry.

Turning to construction products, CPD generated $12.2 million compared to $10.7 million in the prior year quarter. Revenue increased 11% compared to the prior year quarter, due to continued improvement in the U.S.

residential construction sector and higher average selling prices. Fundamentals in the CPD business continue to be excellent, particularly in the U.S.

portion of our business, where we continue to see positive momentum. The management team is making great progress on pricing and margin and management initiatives, we have a good platform that should allow us to realize significant EBITDA improvement as the U.S.

residential, commercial and industrial market continues to grow. CPD continues to make great progress on the system integration project and $5.8 million, U.S.

has been incurred to-date and more in 2016. There were, close to $1 million of IT cost related to system integration project in the third quarter result.

And preparation of the acquisition to the address leverage concerned, we close yesterday on an equity insurance of 13.8 million shares, for net proceeds of $138 million after the over-allotment fees and commissions. The proceeds from the offering will be used to repay debt and for general corporate purposes.

We are very pleased with the success of the offering and it further solidifies our deleveraging profile prior to the acquisition. On the debt management side, I’m pleased to say we were at 3.3 times the total debt to EBITDA, as of September 30, 2015 purchased a new equity insurance.

We anticipate being in the range of 3 to 3.5 at the December 31, 2015 as the net proceeds from the offering will be used to reduce debt. Excluding the impact, the acquisition for Canexus we anticipate being in the range around 3 to 3.5 at the end of 2016.

We anticipate being that 4.1 at closing of the Canexus acquisition. For 2015 guidance, we’ve confirmed our range $165 million to $185 million, for 2016 guidance we release a range of $150 million to $180 million, which includes the impact of the additional share from the offering of CPD, the one-time IT system integration cost, the additional share from the offering result in approximately $0.20 in dilution to AOCF per share for 2016.

We anticipate energy service result to be higher than 2015, as operational improvement in sales and marketing initiative will more than offset the reduction of volume in Propane Canada, due to the oil filed weakness. Construction product result, anticipate to be consistent with 2015 as the one-time IT system integration cost will offset the increased volume and the higher average selling price.

Specialty Chemicals results are anticipate to be consistent with 2015 benefits from the improved foreign exchange rate are being offset by a weaker result related to weaker hydrochloric acid pricing due to the declining in the oil field activity. In regards to our announced acquisition of Canexus October 6, 2015 I would like to reiterate, we’re very pleased with this highly strategic combination which brings together Superior Plus and Canexus.

We believe this transaction is in the best interest of the shareholder of both companies and provide substantial value for both set of shareholder. To quickly summarize the benefits of this transaction we expect AOCF per share accretion from this transaction, to be in the double-digit base on adjusted operating cash flow per share, and assumed our run rate synergy up $35 million.

This acquisition is in line with our core strategy of investing in business with significant free cash flow generation, solid fundamentals and attractive expansion opportunity. With this combination, we’re further enhancing our high quality stable and predictable cash flow and earnings profile as it provides us with the more diversified customer base and business mix.

The combined company will have the lowest cost production in North America and the platform to grow in Brazil and in South America. From a balance sheet perspective, we should de-lever in the first 18 months to 24 months following the transaction closing date, bringing our leverage from 4.1 at closing to a target range of 3 to 3.5 between that 18 months to 24 months.

The transactions will enhance to combined companies ability to serve customers with technology and services including that better optimization of plants and improve logistic resulting in consistent reliable delivery of products for our customers. We will combine the technical strength of both Superior and Canexus including bleaching services and chlorine dioxide generator technical services.

It would also allow both companies to operate more efficiently and reduced the overall costs of both businesses. The detail of transaction, large acquisition will be done by a plan of arrangement where the companies will be combined in a 100% stock transaction.

Canexus’ shareholder will receive 0.153 of the Superior Plus share for each Canexus’ common share. At the time of announcement, the exchange ratio equaled to $1.70 per share of Canexus and they imply a transaction equality value of $316 million in a total enterprise value of $932 million of Canexus.

As part of the transaction to address Canexus’ balance sheet, Superior has entered into an agreement with National Bank Financial and JPMorgan to provide $650 million bridge facility with permanent financing for the combined company to be put in place following the transaction. We’re currently in the process of renegotiating our bank facility, which would be effective with closing of the transaction.

The combination of high yield and convertible debentures will also be utilized as part of the permanent financing. The transaction is subject to certain approvals including regulatory approval required under the Competition Act, court approval and Canexus’ shareholders approvals.

As such we expect the transaction to close in the first half of 2016, once the necessary approvals have been received. We’re confident in our ability to close the transaction during the first half of 2016.

To summarize, we see strong fundamentals in CPD energy services and we are confident we will be able to deliver an improvement of these businesses. In specialty chemicals, we are focused on the acquisition of Canexus to see 2016 as a transition year for Chloralkali.

We continue to see a down market for Chloralkali due to reduced oil field activity. With that said, I’d now like to open up to any question that you may have.

Hi, good morning.

Good morning.

A few questions, first the deal with Canexus. You had indicated in your call about a month ago, that you weren’t planning, I hoping, to sell any assets.

In your plan of arrangement, you talked about you would be willing to sell chlorate plant flow 90,000 tons in North America nonintegrated. Can you give us a sense of where – what you’ve submitted the DOJ competitive bureau in Canada, where we are in the process, what you are willing to sell?

And if they came back and said you have to sell brand in, would you stop this deal and would there be a break fee? Thanks.

Hi, many questions…

Many questions…

I hope I can remember all, Joel, and if I don’t at the end of my answer, you could just come back to the one I potentially could miss. So our objective and we feel very strong that it will not be necessary to do carve out.

Of course, we’re cautious and we always wanted everybody to understand that we’re going to the competitive bureau Canada, U.S. The whole project has to do with efficiency productivity, which is necessary in the industrial business.

And the competitive bureau situation is in process, so it’s a very early stage, probably very premature to think that revenue result that would come out from that with the exception that we feel very strong. In the B2B business that’s a huge volume, represent a very small cost of our customers overall.

And we decide, our Board, and the Canexus Board agreed to get together for the best of the platform that has a North American cost structure that’s in line with the future opportunity to be profitable, as well as having a platform in Brazil with the technology of ERCO and a good plant of Canexus as in Brazil to do more growth in the growth market. So from a competitive bureau, very, very early, we feel very good, because its B2B, it’s a small part of a big volume, $1.2 billion combined together.

And we feel strong that we can do it all. A question on Brandon, there is absolutely none of us could think that that would be a question would come under table.

So we never anticipate that Brandon would be part of any – any carve out. We don’t see that even if we look at it from hundred different angles.

And I guess, you submitted – did you submit the 30-day period for the different regulatory boards that it start last week that you submit – what you have to submit?

Yes, it did start last week, there is 30 days and then I hope that could that 30 days usually is additional question that could come and it could take another 30 days and it goes with chunk of 30 days right on that regard. And we’ll see how the first 30 days goes through and how – how it’s going to go.

We really don’t have any feedback at this stage talk about as it comes and we have communication with investor in the market. We will stay – keep everybody in tune with that.

So turning to chemical business, if I understand your guidance for 2016, what you’re saying is that the FX tailwinds you expect in your hedge expect book will be basically offsets by some weakness in Chloralkali. And then in chlorate, high electricity prices will be offset by better pricing.

Is that right?

Not exactly, I think, I’ll start the first part of the answer and Ed is here with us, so I’ll ask him to add on, and if there is any additional point, we will cover it all. So from a chlorate – from a Chloralkali point of view, no doubt that market is soft and we’re not predicting any upside in 2016.

We don’t know when and how that could happen. We understand the volume is somewhat more steady and we see that, but we don’t predict that we could have price improvement in 2016.

We hope it could come, but we have no forecast. We have not put anything in the forecast for 2016.

On the chlorate, overall, I think it’s important to understand that 80% of our chlorate is really soft issue and there is no decline in that regard. Where that’s the 20%, which is more related to paper, we’ve looked at the market and we see a certain decline in the last many years and it’s on the 20%, not on the 80% and that comes choppy some time.

And we expect for over many years it’s a small percentage, but it could be all in one year and less in this next year. So I think we got chlorates overall for that paper industry, having a little bit more decline this year and going into next year than we anticipated.

There was some two announcement of big plans, that are paper-related and which were our customer, so we’re now, at this stage we say okay, it’s happening a bit faster during that 12 months, 18 months period, not the right, only on the trend overall some decline in the 20%. So may be for more color Ed you could add to, more, a better explanation in that regard.

Yes I guess in terms of the chloralkali side Q1 was actually, fairly strong for us, so for next year we have forecasted full year as the sort of current level as Luc indicated. So that’s some of the downside of the chloralkali business.

On the chlorate side, the market is certainly competitive and we are working through our contracts for next year and we anticipate that pricing will be fairly stable as we go through that period of time.

So if I understand that – sorry, you expect chlorate pricing to be flattish next year with this year is that what it means.

Yes.

And that is even with the U.S. dollar, any better, any – even with the U.S.

dollar dynamic, correct?

Yes, because we’re – the answer is yes. If you asked us 12 months ago we would have said the market should be a better balance with those two mills shut down and chlorate certainly has changed the game somewhat.

2016, you know it’s pretty well done, we’re really close to finishing all the contracts, there’s only a very small quantity left. And you’re right saying that the price will not be improved over 2015.

Okay, thank you for that. My final question will just be in supply portfolio management, you talk about, I believe, a new, if that’s the exact wording, a new long-term agreement and some procurement initiatives.

Can you talk about exactly what the new long-term agreement is and what the initiatives are? Thanks.

Yes that has to do with propane, as you all know we’re a large player, we do 1.7 billion liter in North America. We have developed a strong platform with 20 marketing sales people and logistics, that are in Calgary, they’ve been there before, but their mandate in the last three, four years have changed to not only just secure volume of propane for our business that we do, but let’s leverage our Canadian, North American platform.

We’re not broker we have 22 people full time, we have scale across Canada and the Northeast, we’d say with some site where we can warehouse propane. And we’ve now developed over the last three, four years where we’re positioned that we are more important because we leverage our size and we go out to sell not only our volume, we’ve now started to sell to other people that buy propane for other use.

And the states in North America and we now have a potential new contract coming in Chile. So we’ve used that marketing sales platform and logistic platform to secure propane and get a better price for us, as our volume has grown.

Because we’re – with that size and we’ve reorganized our structure to – for the supplier base to get volume discount for our size. And we’re now getting more size, because we’re doing wholesale with no risk and passing volume through four different customers that are not propane – internal propane customers.

And that’s giving us more size to leverage more pricing from supplier. So we’re becoming, I’d venture to say, North America a super strong platform of logistic procurement of propane and we are now utilizing that to sell to other, opportunity in North America as well as, now starting to and we’ve hired people, start to look at the export market, as well.

It’s a good thing, it’s been slowly developing, we started those investment three years ago, we have sales people covering the east coast, north south, as well as the west and middle America. And now we have people that are also looking at, what can we do for sales in South America and potentially one day China.

That was helpful, thank you, Luc.

Yes, thank you.

Good morning.

Good morning, Jacob.

Question on your 2016 AOCF guidance of $1.50 to $1.80. So I understand that this includes the addition of $13.9 million common shares.

Yes.

But what does that include for – what have you included there as far as Canexus from a AOCF perspective?

When it comes to the chemical side, we’ve decided let’s go, our game plan is what we own, what we control today which is only ERCO and our chemical business. As everything unfold with Canexus, the timing of that, I would assume by – if we’re owning the company and months to come, let’s say by mid-year 2016 or before if possible, then we’ll reshuffle all the numbers and all the costs and we’ll represent to market where we are at going forward, once we are the owner of those assets of that company.

So this point, you expect this to close kind of mid-year next year?

Yes.

Okay.

Yes.

So we could see additional six months worth of Canexus’ ACOF added to this number here at some point?

Absolutely, and then your point is so good because we’re really up $0.20 going away because of the acquisition, because we want to position our self for that acquisition. But we’re not getting the Canexus sales margin EBITDA until mid-year, but that’s the way we have to do it, to really march on and be ready as soon as we can have access and own those assets.

We got the financial structure in place, we have the equity that we did in place. So we’re doing that ahead of time, we would say yes.

But it’s prudent and we feel very confident, so we’re preparing our self like if we’re going to own it in the near future.

Okay and then, do you have any updated thoughts on the Canexus synergies right now?

Yes the $35 million has been promoted, we feel good about it. We have more and more detail line by line.

We actually go from – everybody on the call it’s important to know we really stay away from Canexus business, we’ve done our due diligence, we’ve made our offer, we’ve calculated the high level, those $35 million of synergies. And then it’s really the Doug Wonnacott is the CEO and their management team are running their business as we did in the past we continue to do what they came for that company and we really don’t have a lot more going on because want to be – we don’t own it, we don’t have any rights overview of their business and we’re not doing any of that until the moment that with the owner.

And then Wayne, if you have anything to add to that on the call?

No I think that’s exactly right.

Okay.

Okay. Maybe my last question here is just on the energy services side.

So on that supply portfolio management that $12.5 million that you had in third quarter. Big uptick from where you were, the prior year quarter.

What was in that and is this now the normal or is this kind of normal runoff?

No I think that’s a good question because it just, it’s not that we will we’re painting to a better number than our year-to-year average of course. And to say that kind of an improvement quarter-by-quarter, it will happen, that business will happen in chunk quarter-by-quarter, overall for the year better and next year will be better again.

We are very confident about that because of everything Luc mentioned earlier. But at this stage, I would not take that quarter and extrapolate on that number.

What was the – what led to that they increased quarter-on-quarter basis?

I don’t know if Wayne you want to take that one?

Hi, Jacob, it’s Wayne. First my recollection, the prior quarter, we had some mark-to-market on the inventories.

So we had to reduce that or adjust the inventories. And you’ll recall last year we had some adjustments on their payable side.

And so there are some other things that got put through in the third quarter. So that is creating the rather large variance.

It was – as Luc mentioned, a very solid great quarter for us and we have the underpinnings of these new contracts with our suppliers going forward and so that – that division is going to perform well in the future.

Okay. Thank you very much.

Thank you.

Good morning.

Good morning.

So Just a few questions on chemicals for 2016. So Luc you talked about the pulp mill closures.

Has that started to impact you this year at all, in 2015 on the chemical side?

I’ll ask Ed to answer that and I’ll add on if necessary.

Yes, the two mills that did closed or announced closure were supplied by us. But we do not see that having any significant impact on our volumes for the rest of the – for the fourth quarter, we have some extra, some spot business and some of our customers are running a little harder than anticipated, so we do anticipate that it will, at the end of the day that will come out pretty close to our previously adjusted forecast.

But then, a bigger impact in 2016 or no?

Well, 2016 we’re going to and recontracting our volume, so our intent is to have pickup volume somewhere else.

Okay. So I just had a, I guess in terms of your guidance for 2016, because if I think of the 2015 HCL volume would have already been weak Q2 through Q4.

Yes.

And then on chlorate you had a really weak Q2, because of the downtime, but I’m just trying to figure out why you wouldn’t see, and then you have some FX improvement next year, I’m just trying to get a sense of why you are not going to see any improvement in chemicals in 2016 versus, what we saw in 2015?

Yes, we’ve looked at our numbers and we do have power price increases that are coming through and we have some challenges with working through on the export side, we have seen a little bit more challenge on volumes overseas, because of the weaker currencies with China and with the Europeans. So that market has been a little more competitive than we originally would have seen this year.

But, Sarah I think your point is right on, and if you ask us a year ago, we were anticipating better 2015 like I said at the beginning of the call, and one the first question is, 20% of our volume is do with paper, and unfortunately they don’t reduce the volume linear, we just, that much volume decrease and then bank two chunk of big customer of ours at the same time. That’s created a different in the balance of demand supply in the market and we except to be sold out on 2016, but certainly the price like I said earlier off the rate, because of those two big chunk happening in the same time, are going to be pretty even with 2015, unfortunately for us and we then planned that situation and we didn’t see it coming early and now we have to adapt accordingly.

Okay.

Because otherwise it would be having a better improvement on the chemical business in 2016.

Great, okay.

Yes.

And then on the construction products, the IT system implementation in 2016, is that kind of equally weighted to the year, is it front-end loaded and how should we think about that?

It’s a – when we, we have such good management there and that we are going to do it faster, quicker. So instead of taking two years plan that we started in 2015, we intend to finish it all in 2016.

So it costing us more in 2016, and then remember that kind of system gives you a real good benefit for adding on improvement and margin and in supply chain. How much color people in the call wants on that but as an example when you have the right system, we’re increasing margin, we’re increasing our supply chain improvement.

But we could do twice as much on the improvement and you need system to get there. So just an example when you have 116 location in North America and you have thousands of SKU new different products and size.

You need information to know why, what are we charge into what customer, what’s the cost to serve by product, by customer and why would 116 area would be lower than the other and then you start to create an environment where the water lifts and margin lift when you have that vision. That vision only comes with the right system, identical and supply chain you need it as well.

So we’re pushing to – and Mike and his team can do it faster, quicker. So there is more cost in 2016, but none in 2017.

And that would us in 2017, a lot more opportunity for growth and margin and supply chain or end margin and selling.

Okay. And then outside of the system cost, is there any other restructuring, is all the other restructuring cost behind us here on the construction site?

Yes.

Yes.

I don’t know Wayne if anything comes to your mind, I think that’s pretty here.

No. That’s all behind us.

All behind, yes.

Okay. And then just last from me on the Canexus acquisition.

Can you – in terms of the break fee, can you just clarify like how and when that would be applicable and that side of things?

Yes. And I’m going to ask Wayne to answer that.

Okay. Thanks Luc.

So this is Canexus paying us a break fee and I guess the first thing is obviously standard languages, the breach of representations warranties or covenants under the arrangement. And then of course the other one is – where certain instance where Canexus board accepts its defined interesting lean up [ph] is a Superior proposal.

But it’s somebody comes over the top and offer something likely in excess of our deal and the other one would be where Canexus still comply with this covenants relating to an acquisition proposal. So those are the two major one Sarah.

Okay. Thank you.

Yes. Good morning, guys.

Luc, you described – having introduced your risk business is coming along well and the outlook looks quite good. I’m just curious though given the leverage profile you’ll be taking on to fit the acquisition here.

What kind of opportunities does that leave you with for a small against on the energy services side if any?

Yes, it’s a good question because the add-on – the capacity for us with our platform today on supply chain, pricing intelligence, and logistics, and I would say many tens of millions on how we operate and deliver liquid. To add on acquisition and we only have 25% market share in Ontario, Quebec.

To add on acquisition to those two segments in particular is just a no-brainer and it’s just super. I want to do a lots of those, so what we’re doing and John Engelen is with us here, new VP of Merger Acquisition and we want to go out and start the work and get to find some and when the time comes to – for the money, from our leverage side, it’s a question we have.

We don’t have a straight answer to it because it’s such a good creation of value to do those add on. So we’re doing the work to find company to acquire.

We have not resolved that 4.2. We don’t want to go higher, that’s a problem when it delivered fast and with Canexus and the group has represented 18 months to 24 months, it gets there quite fast.

We will have a solution for that and it’s kind of unfortunate. But I’ll ask Wayne may be if he – if there is more color, you could put to that.

Sure. Thanks, Luc.

Steve, in the past, we have the opportunity in some small acquisitions where we have issued the owner stock, they’re happy to get into Superior stock. So that’s flexibility for us.

And the other thing is the drip. We’re reinstituting and obviously it’s fair to reduce leverage, but it’s equity at a 100% load factor so to speak.

So, those two items and these tend to be relatively small; $1 million, $2 million, $3 million, $4 million EBITDA. And as Luc points out, they come up, they can be general in terms of when they come up, so you want to be opportunistic, but I think we’ve got enough tools in the CapEx to be able to get a good look at some of these.

Okay, great. And just one follow-up, I may on the synergies – you’ve identified pretty clearly I think your confidence in the $35 million.

I’m just trying to get a better sense for the cadence, the confidence in the cadence of those synergies and how they unfold, just whether they could be soon or later, or where the sticking points might be to pulling some of those out?

Do you want to go, Wayne?

Yes. Sure, it’s – all dependent, we’re confident if you look at 12 months.

So we think we can get in the range of 20 to 25 of those. But obviously, if we close mid-year next year, these things take time.

So we’ve talked to the market about out in the first year. So we think we can get a large chunk of those.

And Ed, and his team, and Luc have – and John has been, on our side planning all of that. So I think in the range of 20 to 25 for the first 12 months, after we closed, would be quite realistic.

Okay, very good thank you guys.

Yes.

Thank you.

Great, thanks. Good morning everyone.

Good morning.

Good morning.

I just had a quick question just to follow-up on Joel and Sarah’s question regarding the break fee. The Superior Plus take all the risks in terms of the regulatory risk, and can you just clarify when Superior Plus, sorry, under what scenario of Superior Plus needs to pay that reverse break fee?

Okay, Wayne?

Yes, well, we don’t take the risk that encourage us to look at the agreement as we’ve filed it. It’s defined in terms of the plants that would or could be sold.

So – and that’s no plant – no integrated plant and no plant that’s greater than 90,000 tons. Now, the other question you had was just on the terms for the reverse break fee or sorry…

Yes, that’s right.

Okay, so the, excuse me, so the $25 million reverse termination fee will be retained by Superior. Yes for approvals under the following circumstances, approvals under the Competition Act and Hart-Scott-Rodino Act not obtained on or prior to June 30.

And then if Superior has a breached this representation, warranties or covenants under the arrangement agreement.

So, just to clarify, so if the regulators require that you divest [indiscernible] that’s larger than 90,000 metric tons for year. All right, for example, Brandon or Buckingham or whatever, then would the break fee be applicable or not?

No.

Okay.

Dorran, can I get you confirm that?

Yes…

Okay, yes we can walk.

Okay, all right. And then just moving on to the next question, in terms of the Energy Services businesses and I think you’ve – I think for your 2016 forecast, you are factoring and – you are estimating something that’s relatively flat compared to 2015.

Have you guys factored in any kind of potential impact of manual given that and a lot of people out there are expecting a warmer than usual winter?

Well a good question because I feel a lot of people are new on the call the way we do our forecast is we look at the normalized weather for the last ten years. And we skewed the lot five more and then we say some of that will cooler some are going to be warmer that is normal forecast.

So if there is – if it gets warmer there will be a cost associated with it an EBITDA more normal then normal I would over the last ten years. The effect in Canada we only we do 20% residential where there is much more variance in residential sales when it is warm or cold the rest is the different segment we sell to commercial industrial and other stuff, there really that much effect so the effect is there but it’s not major, major.

Our Northeast to us safe business was skew over 50% residential. So that will be affected more by a warmer climate for the full winter absolutely and the – yeah is overall two more call like it was let’s say in some years when we forecast we forecast normal, we don’t forecast over the fact that last year – it was cooler or [indiscernible] we just take the average and this is how we forecast.

I see okay. I know, I guess are you make putting any I guess – hedges or anything in place to I guess prepare for a I potentially lower than usual.

Once you, I guess you don’t really hold too much inventories anyway is that right?

No I tell about two week max that’s a and then we do think about our cost level overhead and the number of people and on the field and we’re ready when [indiscernible] very comes absolutely ready but this is what we’ve developed in the last three years is more of the flexible work force and we have the right now which we’ve done before to saying okay less volume less business and we can slowdown to the tune of about to 20% of our work force now that’s getting trained every year but there up and down they are going to follow them we follow more of the variants of the demand and supply so we do have – toolbox of capacity to buy less and not be stuck with too much inventory and we do also have the capacity to reduce our workforce to a degree, if it’s too warm. So that’s why I think in Canada, there is an EBITDA effect it was warmer than average and we rather – that it’s not the case, but yes, there will be – for both businesses what I talk about flexibility we have Canada and U.S.

and then we would play it one by one to make adjustments.

I see, okay. And then just one last question.

I think you mentioned there is about $13 million of investments required for the chlorine railcars in 2016.

Yes.

I guess roughly how many cars are we talking about retrofitting and will there be additional cost in 2017 or will all of the railcars be retrofitted in 2016.

Ed note this point I’ll ask Ed to confirm to talk about that.

Yes, so that $13 million Canadian is for 50 new cars. So what we’re buying is brand new interim design cars for the chlorine fleet and we will be then displacing some of our older non-normalize steel cars that we still have in our fleet.

So that’s what the – that’s what that $13 million is related to.

Okay. So it’s, you are not retrofitting anything, it’s mainly just buying new cars to replace old cars.

Correct, these are the – is a new safer, heavier designed railcars, yes.

Let me come back to the question you’ve asked at the beginning and I think you had some confusion on the question, so I want to clarify that. When do we paid the $25 million?

If we were – when the situation where we really feel strong, I want to reemphasize, not a lot of reason up there why, we wouldn’t own all the plants and we’d be one company. I would – we hope it never goes to the next level, but.

And then if we were to do some carve out plants, we would rather not and we hope not and it doesn’t make sense that it gets there, but who knows in this world what can happen. So yes, we would add some opportunity to do some of that.

After that if we said, no, if we don’t want to carve out anything, we’re not going to carve outsomething that nobody here can imagine. Then we would have to pay the fee to Canexus.

If we were to say no, if we were to walk away from the deal after the carve outthat we don’t want to do, that we don’t think we need to do, there’s more of that, we would have to pay the fee.

Okay.

So was the question answered I wasn’t sure we were right path?

Yes, so let me just kind of tell you what I think I’m hearing. So if you have I’d say so Saskatoon which also produces chloralkali or if you have to sell or if the regulator requires that you sell, Buckingham which exceeds the 90,000 metric tons, then you could either agree…

Yes.

But if you don’t want to sell it, you would have to pay – if you don’t want to sell it, and you don’t move forward with the transaction, then you have to – then pay at a break fee, right?

Yes, sir.

Okay, so there isn’t a clause where if the regulator requires that you sell something big, you can’t just…

Walk away.

Walk away and not pay a break fee.

Exactly.

Okay, that’s correct.

That’s more clear, I’m glad we’re back to that and your question was more, so we have your answer.

Okay, thank you. Those are my questions for now.

Thank you. Thank you very much.

Great, thank you.

Yes, good morning guys. So Luc, just to be clear on your comments with respect to business as usual over at Canexus, on the chlorite pricing front as contractors are being renewed this fall, obviously last year would have been head-on-head competition.

I’m just wondering if there’s some sort of agreement in place here, that helps to protect pricing for the next year and the overall economics of the transaction?

Well, not at all, the zero discussion with – in the data room in the Canexus we looked at zero customers, zero price, zero margin. Now the one question to them on anything that has to do related to market, I can’t tell you though that when an industry that’s mature with chlorate, when an industry that has lots of competitors and when an industry that on the demand and supply was getting tighter with what we hope.

And with those two mills shutdown, probably it creates not too much of an imbalance, but more and there’s probably a little bit more supply than demand. Not that much but a bit.

So at this stage, absolutely zero discussion, and we will not have any discussion in that regard until we own the company. It’s a something we’ve held very strong that, we’re good supplier customers, we’ll run the company by the book here and we’re very transparent in everything we do and don’t do and we told Canexus and they also were in agreement with that.

None of those discussions are taking place or will until we own the enterprise.

Okay, thanks for that.

It’s as competitive as it’s always been.

And will contribute because of the market situation.

Yes, got it. And then on hydrochloric acid, and the recent pricing pressures there.

Just wondering where margins are at relative to chlorine and how you’re thinking about the production mix going forward, especially as some of your term contracts on hydrochloric acid may be roll off, and you have the ability to switch back to chlorine?

Yes. Good question, I’ll ask Ed to answer that.

Yes. So we take a look at the margins from both of the products and a lot of its related to what is the cost delivered to the end customer.

And we have the ability to flip back and forth on either having a heavier mix for chlorine or heavier mix for acid depending upon the margins coming back to the plant. So we do look at that on an annual, in a quarterly basis.

So we are looking at next year probably having a little higher ratio of chlorine to acid than we had in 2015.

Okay. Can you give us any context as to relative margins, either percentage-wise?

One thing we talk to margins…

Yes, we look at the margin, but we don’t think about it in terms of one relative to the other.

Okay.

No, but also…

And I don’t really want to get into kind of where those…

I think when it comes to margin by customer, by segment we’re very careful or I think we disclose everything. And as the company, we’re top of the list in disclosure, but when it comes to product and margin we’ve not done that and would rather stay away from that.

Fair enough. And then finally guys just on the non-odorized propane volumes…

Yes.

That were delivered across the Paris [ph], any update on what happened there and what the financial exposure might be for Superior, if any?

Okay, absolutely, so for everybody on the call this is an area in Saskatoon where we have 3% of our volume that comes from one particular supplier. And we were advised by the supplier last Friday that some of the propane that they shipped to us that we shipped to our customers in that region of Saskatoon, which represents again less than 3% of our volume, that we had send some propane.

But one of the conditions of propane is it has to be a smell packs where you smell the propane. And that kind of liquid propane does the same job, but there’s no smell.

So when we heard that we took it extremely seriously. We’ve organized an action plan and a game plan internally which took us the whole weekend till Monday.

And we’re able and I was pleased with that, we’re able to know where we shipped what, even if have a second shipment, which regular propane that smells to that same place, we went to call every customer that received the propane was not that much for us, but it wasn’t the number of tank and we called them all. We said that – we told them the situation, we told them we’re coming.

We get people from around the queries and across our company to go and to organize to deliver new liquid immediately. I think we’re going to be finished within two weeks of having done all of that, and of course, that didn’t bring any negative event.

The cost of adding organize our sales and deliver like tons of people to work to just go do that immediately and within the two weeks’ timeframe having covered all the tanks. There is extra cost of that, and we’re adding that cost to accounting for it.

I know what is today, it’s probably not big I know we’re not talking, I don’t think it will be $1 million, but there is a cost and we’re expecting the supplier that and also propane that they had a contractually to send out that propane with the smell of propane. So they are responsible for that.

So we expect that they will pay that bill and we’re done with covering every tank as we need to. Yes.

Okay. Thanks guys, that’s all I had.

Yes, thank you.

Yes, good morning, and it’s been partly addressed, but just wanted to make sure I get it right. The reverse break fee, can we say in simple terms that if the deal does not close you do have to pay that reverse fee of $25 million?

Yes.

And whatever the reason?

If we – no, there are some transition. If we walked away, and the question I think it was well positive explained before.

So first we expect that everything goes – maybe I’ll ask Wayne because he did said that earlier, so I’ll ask Wayne to give more detail on that.

Yes, thanks, Luc. John, it might be helpful if John respond to that one.

Okay. John?

Hi, it’s John Engelen. So the reverse break fee is payable by Superior if we decide to walk away because the remedy requested by the competition bureaus is more than we’re willing to accept, or if we have a representation breach as a normal contract.

Their break fee for Canexus is payable as Wayne indicated earlier.

Okay. But if the competition bureau would ask you to divest of something less than 90,000 tonnes in non-integrated, then you would not have and you would decide to walk away.

No, no, then we would – we have put that as a condition in the agreement, that we would accept that and we would be willing to contract under that basis, we would not have the right to walk away under that alternative.

Okay, thank you.

Okay.

Okay, well thank you everyone. Understand that sum up to cover and there is lot of division in the Canexus acquisition with everything that’s doesn’t work.

It’s a good side puzzle, but I can hopefully we assure all of you that, we do have a clarification, we do have a hiccup in 2016 in chlorate, that’s more than we anticipated. And we are not very pleased about that.

But, I really, really strongly believe in change nothing from the game going forward. For 2017 and on, we have the other division as you all saw in the result and the momentum that are flicking extremely well.

So we will do our work in 2016 and hopefully with the Canexus and get the synergies and get the company to be on solid, more solid ground together. As an enterprise Canexus and us then separate, for all the good reason that we talked about over the last many weeks.

So we’re I think, looking forward to 2017 and on of course and the chemical to be much better years. We do have that foreign exchange that’s going to continue to come back to our company as the years unfold.

And it’s big a number, as most of you know. So understanding situation we’re in is good.

And there is probably, a bit of an acceptance from us and all of you that 2016 will more difficult because of the project and the acquisition, and the integration. When you look forward to these enterprise and division, we are a good enterprise, that’s going to do very well.

So just want to make sure, hopefully you are convinced, all of you about that because that’s the intent and that’s what we see and we’re going to make it happen. So on that, thank you everyone to participate in our call.

Yes.