Securities Law & Instruments

Headnote

MutualReliance Review System for Exemptive Relief Applications - issuerhas only one security holder - issuer deemed to have ceased tobe a reporting issuer.

ApplicableOntario Statutory Provisions

SecuritiesAct, R.S.O. 1990, c.S.5, as am. s. 83.

INTHE MATTER OF
THE SECURITIES LEGISLATION
OF ONTARIO, ALBERTA, SASKATCHEWAN,

QUÉBEC,NOVA SCOTIA,
NEWFOUNDLAND AND LABRADOR
AND YUKON

AND

INTHE MATTER OF

THEMUTUAL RELIANCE REVIEW SYSTEM

FOREXEMPTIVE RELIEF APPLICATIONS

AND

INTHE MATTER OF

SPARAEROSPACE LIMITED

MRRSDECISION DOCUMENT

WHEREASthe local securities regulatory authority or regulator(the "Decision Maker") in each of Ontario, Alberta,Saskatchewan, Québec, Nova Scotia, Newfoundland and Labradorand Yukon (the "Jurisdictions") has receivedan application from Spar Aerospace Limited (the "Filer")for a decision under the securities legislation of the Jurisdictions(the "Legislation") that the Filer be deemedto have ceased to be a reporting issuer or the equivalent underthe Legislation;

ANDWHEREAS pursuant to the Mutual Reliance Review Systemfor Exemptive Relief Applications (the "System"),the Ontario Securities Commission is the principal regulator forthis application;

ANDWHEREAS the Filer has represented to the Decision Makersthat:

(a)The Filer is continued under the Canada Business CorporationsAct (the "CBCA"), is a reporting issuer in eachof the Jurisdictions, and is not in default of any requirementsunder the Legislation.

(b)The Filer's head offices are in Toronto, Ontario.

(c)Prior to the Consolidation (as defined below) the Filer was authorizedto issue an unlimited number of common shares (the "CommonShares"), of which 15,108,273 Common Shares were issuedand outstanding as of the date of the Consolidation. The Filerwas also authorized to issue 10,000,000 preferred shares and 20,000,000junior preferred shares. There were no preferred shares or juniorpreferred shares issued and outstanding as of the date of theConsolidation.

(d)The Filer does not intend to seek public financing by way of anoffering of securities.

(e)On October 17, 2001, a formal offer (the "Offer")was made by 3931170 Canada Inc. (the "Offeror"),a wholly-owned subsidiary of L-3 Communications Corporation, topurchase all of the issued and outstanding Common Shares for $15.50cash for each Common Share deposited under the Offer.

(f)The Offer was extended on each of November 22, 2001, December3, 2001, and December 14, 2001.

(g)On December 6, 2001, Spar announced that it was proceeding witha going private transaction, which was effected by way of a shareconsolidation (the "Consolidation").

(h)The Offer expired on January 3, 2002. As of January 10, 2002 theOfferor had taken up and paid for approximately 10,872,488 CommonShares, representing approximately 71.9% of the outstanding CommonShares.

(i)The Consolidation, which was carried out pursuant to section 173of the CBCA, was effected in accordance with the terms of a specialresolution passed by a special majority of shareholders of theFiler at a shareholder meeting held on January 23, 2002. The Consolidationbecame effective on January 23, 2002, upon filing of the articlesof amendment and the issuance of a certificate of amendment givingeffect thereto.

(j)On January 23, 2002, the Filer held a special meeting of shareholderswhere the shareholders voted to approve the Consolidation.

(k)Upon the Consolidation:

(i)all of the Common Shares were changed into new common shares (the"New Common Shares") on the basis of one (1)New Common Share for each 5,289,500 Common Shares;

(ii)holders of Common Shares were not entitled to receive certificatesfor fractional New Common Shares, and were not entitled to exerciseany of the rights of shareholders in respect of any fractionalNew Common Share other than the right to receive payment, withoutinterest, of the sum of $15.50 in cash for each Common Share heldimmediately prior to Consolidation;

(iii)the Offeror became the sole shareholder of the Filer; and

(iv)New Common Shares were only issued to the Offeror (as the soleshareholder of the Filer).

(l)The Filer is currently authorized to issue:

(i)an unlimited number of New Common Shares, of which two (2) NewCommon Shares are issued and outstanding;

(ii)10,000,000 preferred shares, none of which are issued or outstanding;and

(iii)20,000,000 junior preferred shares, none of which are issued oroutstanding.

(m)The Common Shares were delisted from The Toronto Stock Exchangeon January 25, 2002, and no securities, including debt securities,of the Filer are listed or traded on an exchange or market inCanada or elsewhere.

(n)Other than the New Common Shares, the Filer has no securities,including debt securities, outstanding.

ANDWHEREAS under the System, this MRRS Decision Documentevidences the decision of each Decision Maker (collectively, the"Decision");

ANDWHEREAS each of the Decision Makers is satisfied thatthe test contained in the Legislation that provides the DecisionMaker with the Jurisdiction to make the Decision has been met;

THEDECISION of the Decision Makers pursuant to the Legislationis that the Filer is deemed to have ceased to be a reporting issueror the equivalent under the Legislation.

March14, 2002.

"JohnHughes"