Securities Law & Instruments

IN THE MATTER OF

THE SECURITIES LEGISLATIONOF

BRITISH COLUMBIA, ALBERTA,SASKATCHEWAN,

ONTARIO, QUEBEC, NOVA SCOTIAAND

NEWFOUNDLAND AND LABRADOR

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEWSYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

DUPONT CANADA INC.

 

DECISION DOCUMENT

WHEREAS the local securities regulatoryauthority or regulator (the "Decision Maker") in eachof British Columbia, Alberta, Saskatchewan, Ontario, Québec,Nova Scotia and Newfoundland and Labrador (the "Jurisdictions")has received an application from DuPont Canada Inc. ("DuPontCanada"), for a decision pursuant to the securities legislationof the Jurisdictions (the "Legislation") that DuPontCanada be deemed to have ceased to be a reporting issuer orthe equivalent thereof under the Legislation;

AND WHEREAS pursuant to the Mutual RelianceReview System for Exemptive Relief Applications (the "System"),the Ontario Securities Commission is the principal regulatorfor this Application;

AND WHEREAS, unless otherwise defined,the terms herein have the meaning set out in National Instrument14-101 Definitions or in Quebec Commission Notice 14-101.

AND WHEREAS DuPont Canada has representedto the Decision Makers that:

1. DuPont Canada is a corporation amalgamatedunder the Canada Business Corporations Act (the "CBCA").DuPont Canada's head office is located at 7070 MississaugaRoad, Mississauga, Ontario, L5M 2H3. DuPont Canada is a corporationresulting from (i) the amalgamation (the "Amalgamation")of DuPont Canada Inc. ("Old DuPont") and DCI AcquisitionInc. ("DCI Acquisition") on July 28, 2003 to createa corporation called "DuPont Canada Inc." ("InitialAmalco") and (ii) a subsequent amalgamation (the "SecondAmalgamation") of DCI Holding Company Inc. ("DCIHolding") and Initial Amalco on August 1, 2003.

2. The authorized capital of DuPont Canadaconsists of an unlimited number of common shares ("AmalcoCommon Shares"). As of the date hereof, all of the issuedand outstanding Amalco Common Shares are owned by an affiliateof E.I. du Pont de Nemours and Company ("EID").On the Initial Amalgamation, certain Class A redeemable preferredshares ("Initial Amalco Redeemable Preferred Shares")were issued, all of which were subsequently redeemed. On theSecond Amalgamation, each unissued Initial Amalco RedeemablePreferred Share was converted into one non-interest bearingdemand promissory note of DuPont Canada in the principal amountof $21.75 (an "Amalco Note"). No Amalco Notes areissued and outstanding.

3. DuPont Canada also has outstanding a totalof 18,800 options, each of which may be exercised to acquireone Amalco Note ("Amalco Options"), which are heldby a total of 94 individuals (the "Optionholders").Of the 94 Optionholders, 84 are resident in the Province ofOntario, six are resident outside of Canada, two are residentin the Province of Québec and there is one Optionholderresident in each of the Provinces of Alberta and Manitoba.Each Optionholder holds 200 Amalco Options, which were grantedto the Optionholders by Old DuPont in connection with the200th anniversary of EID. Each of the Amalco Options is "outof the money" in that each is exercisable at a pricegreater than the $21.75 principal amount of one Amalco Noteand it is therefore anticipated that none of the Amalco Optionswill ever be exercised. If any such Amalco Options are exercised,it is the intention of DuPont Canada to immediately repaythe Amalco Notes issued upon the exercise of any such AmalcoOptions.

4. In connection with a previously announcedreorganization of EID's world-wide business (the "Reorganization"),on April 17, 2003, DCI Acquisition, an affiliate of EID (thethen indirect holder of approximately 76% of the outstandingclass A common shares, series 1 of Old DuPont ("Old DuPontShares")), made an offer to acquire all of the Old DuPontShares not owned by it or its affiliates at a price of $21.00per share (the "Offer"), which was subsequentlyvaried and extended and the price payable under the Offerwas increased to $21.75 cash per Old DuPont Share.

5. On June 16, 2003, DCI Acquisition tookup, and on June 19, 2003 paid for, the 47,141,872 Old DuPontShares deposited to the Offer such that, following completionof the Offer, EID owned, directly or indirectly, 259,733,032Old DuPont Shares, representing approximately 93% of the outstandingOld DuPont Shares.

6. In the circular accompanying the Offer,DCI Acquisition disclosed its intention, if the Offer wassuccessful, to acquire all of the Old DuPont Shares not depositedunder the Offer by means of a subsequent acquisition transaction.As a statutory right of acquisition under the CBCA was notavailable following completion of the Offer, DCI Acquisitionproceeded with the Initial Amalgamation.

7. Old DuPont called an annual and specialmeeting of its shareholders for July 28, 2003 (the "Meeting")to consider, among other things, a special resolution (the"Special Resolution") approving the Initial Amalgamationpursuant to Sections 181 and 182 of the CBCA. On July 2, 2003,Old DuPont mailed a Management Information Circular (the "MeetingCircular") to shareholders in connection with the Meeting.The Meeting Circular described the proposed Initial Amalgamationand summarized the dissent and appraisal rights availableto shareholders who wished to dissent in respect of the SpecialResolution.

8. The Initial Amalgamation was a second stepgoing private transaction within the meaning of Ontario SecuritiesCommission Rule 61-501 and Policy Q-27 of the Commission desvaleurs mobilières du Québec.

9. At the Meeting, the Special Resolutionwas passed by 99.9% of the votes cast at the Meeting in accordancewith the provisions of the CBCA. Following the Meeting, thearticles of amalgamation were filed and the Initial Amalgamationbecame effective on July 28, 2003.

10. On the Initial Amalgamation becoming effective:

(a) each issued and outstanding Old DuPontShare (other than those held by DCI Acquisition and itsaffiliates) was converted into one Initial Amalco RedeemablePreferred Share;

(b) each issued and outstanding Old DuPontShare held by DCI Acquisition was cancelled;

(c) each issued and outstanding Old DuPontShare held by affiliates of DCI Acquisition was convertedinto one Initial Amalco Common Share;

(d) each issued and outstanding share inthe capital of DCI Acquisition was converted into one InitialAmalco Common Share; and

(e) each issued and outstanding option toacquire one Old DuPont Share became an option exercisablefor one Initial Amalco Redeemable Preferred Share.

11. On July 29, 2003, the day following theInitial Amalgamation:

(a) each of the Initial Amalco RedeemablePreferred Shares were redeemed for $21.75 in cash, in accordancewith their terms, with the result that DuPont Canada isnow an indirect wholly-owned subsidiary of EID; and

(b) the Old DuPont Shares were delistedfrom the Toronto Stock Exchange at the close of trading.

12. On August 1, 2003, the Second Amalgamationoccurred such that:

(a) each issued and outstanding InitialAmalco Common Share (other than those held by DCI Holding)was converted into one Amalco Common Share;

(b) each common share in the capital ofDCI Holding was converted into one Amalco Common Share;

(c) each issued and outstanding InitialAmalco Common Share held by DCI Holding was cancelled; and

(d) each issued and outstanding option toacquire one Initial Amalco Redeemable Preferred Share becamean Amalco Option exercisable for one Amalco Note.

13. In connection with implementing the Reorganization,DuPont Canada may be party to certain additional amalgamationswith affiliates of EID in the future; however, EID will remainthe direct or indirect owner of all of the common shares ofany successor corporation to DuPont Canada created as a resultof any such amalgamation.

14. DuPont Canada is a reporting issuer ineach of the Jurisdictions and to the best of its knowledge,is not in default of any of the reporting requirements underthe Legislation.

15. DuPont Canada has no outstanding securities,including debt securities, other than the Amalco Common Sharesand the Amalco Options.

16. No securities of DuPont Canada are listedon any exchange in Canada or elsewhere, nor does DuPont Canadaintend to make a distribution of its securities to the publicin the future.

AND WHEREAS pursuant to the System thisDecision Document evidences the decision of each Decision Maker(collectively, the "Decision");

AND WHEREAS each Decision Maker is satisfiedthat the test contained in the Legislation that provides theDecision Maker with the jurisdiction to make the Decision hasbeen met;

THE DECISION of the Decision Makers underthe Legislation is that DuPont Canada is deemed to have ceasedto be a reporting issuer under the Legislation.

September 26, 2003.

"R. W. Davis"
"H. Lorne Morphy"