Securities Law & Instruments

Headnote

Subsections74(1) and 104(2)(c) - relief from registration requirementsgranted in connection with certain trades by employees and non-employeesin connection with employee compensation plan - relief fromissuer bid requirements granted in connection with acquisitionsof securities from employees and non-employees at a price determinedunder the plan.

StatutesCited

SecuritiesAct, R.S.O. 1990, c.S.5, as am., ss. 25, 35, 74(1), 95, 96,97, 98, 100 and 104(2)(c).

RegulationsCited

Regulationmade under the Securities Act, R.R.O. 1990, Reg. 1015, as am.,ss. 183, 203, 204 and 206.

INTHE MATTER OF

THESECURITIES ACT

R.S.O.1990, CHAPTER 5, AS AMENDED (THE "ACT")

AND

INTHE MATTER OF

ELECTRONICDATA SYSTEMS CORPORATION

Rulingand Order

(Subsections74(1) and 104(2)(c))

WHEREASthe Ontario Securities Commission (the "Commission") has receivedan application from Electronic Data Systems Corporation ("EDS"orthe "Company") for a decision pursuant to subsection 74(1) ofthe Act that:

(a)the exercise of Awards (defined below) issued under the ElectronicData Systems Corporation Amended and Restated Incentive Plan(the "Plan") through the agent(s) appointed by EDS under thePlan (each an "Agent"), shall not be subject to the registrationrequirements of section 25 of the Act;

(b)the reacquisition of Shares of common stock of EDS ("Shares")and awards issued under the Plan ("Awards) by EDS pursuant toStock-Swap Exercises (defined below), certain Award surrendersand Withholding Acquisitions (defined below) from employeesor directors of EDS or its affiliates ("EDS Companies") or Non-EmployeeParticipants (defined below), through the Agent shall not besubject to section 25 of the Act; and

(c)first trades ("First Trades") in Shares acquired under the Planby Non-Employee Participants (defined below) shall not be subjectto section 25 of the Act;

ANDWHEREAS the Commission has received an applicationfrom the Company for an order pursuant to subsection 104(2)(c)exempting the Company from sections 95, 96, 97, 98 and 100 ofthe Act and the Regulation made thereunder and from the requirementsof subsection 203.1(b)(ii) of the Regulation (the "Issuer BidRequirements") with respect to certain acquisition by the Companyof Shares and Awards of its own issue pursuant to the Plan;

ANDWHEREAS EDS has represented to the Commission as follows:

1.EDS is a corporation incorporated under the laws of the Stateof Delaware, is not a reporting issuer under the Act and hasno present intention of becoming a reporting issuer under theAct.

2.The authorized share capital of EDS consists of 2 billion Sharesof which, as of November 30, 2001, there were 477,700,000 Sharesissued and outstanding.

3.EDS is subject to the requirements of the Securities ExchangeAct of 1934, as amended, of the United States, including thereporting requirements thereof.

4.The purpose of the Plan is to aid the Company and its subsidiariesin attracting and retaining employees and directors of the Companyand its affiliates ("Service Providers").

5.The Shares offered under the Plan are registered with the U.S.Securities and Exchange Commission (the "SEC") under the SecuritiesAct of 1933 and are listed for trading on the New York StockExchange ("NYSE").

6.Under the Plan, options exercisable for Shares ("Options"),stock appreciation rights ("SARs"), and performance awards ("PerformanceAwards") valued in reference to or based upon Shares or factorsthat influence the value of Shares (all of the foregoing collectively,"Awards") may be granted to Service Providers.

7.The EDS Companies will identify Service Providers to be grantedAwards under the Plan.

8.EDS intends to engage the services of one or more Agents inconnection with the Plan. The current Agents under the Planare Mellon Investor Services, LLC. ("Mellon") and FutureShareFinancial. FutureShare Financial is, and, if replaced or anadditional Agent, is appointed to take on broker functions,such Agent will be, a corporation registered under applicableU.S. securities or banking law. Each of Mellon and FutureShareFinancial has been and any additional Agents will be, authorizedby EDS to provide services under the Plan. Neither Mellon norFutureShare Financial is a registrant in Ontario and, any additionalAgent is not expected to be a registrant in Ontario.

9. TheAgent's role in the Plan will involve various administrative andbrokerage functions and may include: (i) facilitating the exerciseof Awards (including cashless exercises, stock-swap exercisesand Award swap exercises) under the Plan; (ii) maintaining brokerageand record keeping accounts and holding Shares on behalf of participantsunder the Plan; and (iii) facilitating the resale of Shares acquiredunder the Plan through the NYSE.

10.As of January 1, 2002, there were approximately 4,500 ServiceProviders resident in Ontario eligible to participate in the Plan("Ontario Service Providers").

11.Participation in the Plan by Ontario Service Providers is voluntaryand such Service Providers are not induced to participate in thePlan or to exercise their exercisable Awards by expectation ofemployment or continued employment with EDS Companies.

12.Awards are not transferable otherwise than by will or the lawsof intestacy.

13.The committee appointed by the Board of Directors of EDS (the"Committee") shall establish procedures governing the exerciseof Options (and other Awards that are capable of being exercised).Generally, in order to exercise an Option or other exercisableAward, the Award holder, must submit to EDS or to the Agent awritten notice of exercise identifying the Award and the numberof Shares being exercised, together with full payment of the optionprice, withholding taxes and other transaction costs, if any (collectively,"Exercise Costs"). The Exercise Costs of an Award may be paidin cash or by way of a cashless exercise, stock-swap exercise,Award-swap exercise, or such other method permitted by the Committee.

14.Shares withheld in payment of Exercise Costs may either (i) besold by the Agent on behalf of the Awardholder and the proceedsof the sale delivered to the Company, or (ii) be reacquired byEDS through a netting out process or otherwise ("Withholding Acquisitions").

15.Following the termination of an Ontario Service Provider's relationshipwith the EDS Companies, a former Ontario Service Provider, orin some cases the legal representative of an Ontario Service Provideror former Ontario Service Provider, or the beneficiary of an Awardor Shares under a will or the laws of intestacy (collectively,"Non-Employee Participants") may continue to have rights in respectof such Awards and Shares ("Post-Termination Rights"). Post-TerminationRights may include, among other things, the right of a Non-EmployeeParticipant to exercise an Award for a specified period and theright to sell Shares issued under the Plan through an Agent.

16.A copy of the U.S. Prospectus relating to the Plan will be deliveredor made available to each Ontario Service Provider who is grantedan Award under the Plan. The annual reports, proxy materials andother materials EDS is required to file with the SEC, will beprovided or made available to persons who acquire Shares underthe Plan and become shareholders at substantially the same timeand in substantially the same manner as the documents are providedto U.S. shareholders.

17.Ontario Service Providers and Non-Employee Participants who wishto sell Shares acquired under the Plan, may do so through theAgent.

18.As at January 28, 2002, Canadian shareholders did not own, directlyor indirectly, more than 10% of the issued and outstanding Sharesand did not represent more than 10% of the shareholders of EDS.

19.Because there is no market for the Shares in Ontario and noneis expected to develop, any resale of the Shares acquired underthe Plan will be effected through the facilities of a stock exchangeor organized market outside of Ontario on which the Shares maybe listed or quoted for trading.

20.The registration exemption contained in subsection 35(1)(12)(iii)of the Act is not available in connection with Option and Awardexercises by Non-Employee Participants effected through the Agentas the Agent is a market intermediary in Ontario but is not registeredunder the Act.

21.The acquisition of Shares by EDS through the Agent upon an OntarioService Provider or Non-Employee Participant tendering Sharesin payment of the Award exercise price pursuant to a stock-swapexercise or pursuant to Withholding Acquisitions, is not exemptfrom the registration requirements under either subsection 35(1)(17)of the Act or under subpart 2.2(b) of OSC Rule 45-501 becausethe Agent is a market intermediary in Ontario and is not registeredunder the Act.

22.No exemption from the registration requirements is available inOntario for First Trades by Non-Employee Participants throughthe Agent.

23.No exemption is available from the Issuer Bid Requirements forcertain acquisitions by EDS of Shares in accordance with the termsof the Plan since such acquisitions may occur at a price thatis not equal to the "market price" as that term is defined insubsection 183(1) of the Regulations to the Act.

ANDWHEREAS the Commission is satisfied that to do so wouldnot be prejudicial to the public interest;

ITIS RULED, pursuant to subsection 74(1) of the Act that:

(1)the exercise of Options or Awards that are capable of being exercisedand related trades in Shares made in connection with the Planeffected through the Agent shall not be subject to the registrationrequirements of the Act;

(2)acquisitions of Shares or Awards by EDS from Ontario Service Providersor Non-Employee Participants through the Agent as a means of satisfyingExercise Costs (including withholding taxes) for Options and Awardsgranted pursuant to the Plan or otherwise in accordance with thePlan, shall not be subject to the registration requirements ofthe Act;

(3)the registration requirement shall not apply to First Trades byNon-Employee Participants in Shares acquired under the Plan madethrough the Agent provided the conditions in subsection 2.4 ofOntario Commission Rule 45-503 are satisfied; and

ITIS ORDERED pursuant to subsection 104(2)(c) of the Actthat acquisitions of Shares and Awards by EDS from Ontario ServiceProviders or Non-Employee Participants are exempt from the IssuerBid Requirements, provided that such acquisitions are made inaccordance with the provisions of the Plan.

March8, 2002.

"PaulM. Moore"       "Theresa McLeod"