DuPont
Annual Report 2012

Plain-text annual report

2012 UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549FORM 10-K(Mark One) ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31, 2012ORo TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934____________________________________________________________________________Commission file number 1-815E. I. DU PONT DE NEMOURS AND COMPANY(Exact name of registrant as specified in its charter)DELAWARE(State or Other Jurisdiction of Incorporation or Organization) 51-0014090(I.R.S. Employer Identification No.)1007 Market StreetWilmington, Delaware 19898(Address of principal executive offices)Registrant's telephone number, including area code: 302-774-1000Securities registered pursuant to Section 12(b) of the Act(Each class is registered on the New York Stock Exchange, Inc.):Title of Each Class__________________________________________________Common Stock ($.30 par value)Preferred Stock(without par value-cumulative)$4.50 Series$3.50 SeriesNo securities are registered pursuant to Section 12(g) of the Act._____________________________________________________ Indicate by check mark whether the registrant is a well-known seasoned issuer (as defined in Rule 405 of the Securities Act). Yes  No o Indicate by check mark whether the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No  Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during thepreceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past90 days. Yes  No o Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to besubmitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrantwas required to submit and post such files). Yes  No o Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best ofregistrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and largeaccelerated filer" in Rule 12b-2 of the Exchange Act.Large accelerated filer Accelerated filer oNon-accelerated filer oSmaller reporting company o Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No  The aggregate market value of voting stock held by nonaffiliates of the registrant (excludes outstanding shares beneficially owned by directors and officers and treasuryshares) as of June 30, 2012, was approximately $47.0 billion. As of January 31, 2013, 934,288,000 shares (excludes 87,041,000 shares of treasury stock) of the company's common stock, $0.30 par value, were outstanding.Documents Incorporated by Reference(Specific pages incorporated are indicated under the applicable Item herein): IncorporatedBy ReferenceIn Part No.The company's Proxy Statement in connection with the Annual Meeting of Stockholders to be held on April 24, 2013. III  E. I. du Pont de Nemours and CompanyForm 10-KTable of ContentsThe terms "DuPont" or the "company" as used herein refer to E. I. du Pont de Nemours and Company and its consolidated subsidiaries, or to E. I. du Pont deNemours and Company, as the context may indicate. PagePART I Item 1.Business2 Item 1A.Risk Factors8 Item 1B.Unresolved Staff Comments11 Item 2.Properties11 Item 3.Legal Proceedings12 Item 4.Mine Safety Disclosures13PART II Item 5.Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities14 Item 6.Selected Financial Data16 Item 7.Management's Discussion and Analysis of Financial Condition and Results of Operations17 Item 7A.Quantitative and Qualitative Disclosures About Market Risk38 Item 8.Financial Statements and Supplementary Data39 Item 9.Changes In and Disagreements With Accountants on Accounting and Financial Disclosure39 Item 9A.Controls and Procedures39 Item 9B.Other Information39PART III Item 10.Directors, Executive Officers and Corporate Governance40 Item 11.Executive Compensation41 Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters42 Item 13.Certain Relationships and Related Transactions, and Director Independence42 Item 14.Principal Accountant Fees and Services42PART IV Item 15.Exhibits and Financial Statement Schedules43SIGNATURES 46Note on Incorporation by ReferenceInformation pertaining to certain Items in Part III of this report is incorporated by reference to portions of the company's definitive 2013 Annual Meeting ProxyStatement to be filed within 120 days after the end of the year covered by this Annual Report on Form 10-K, pursuant to Regulation 14A (the Proxy).1Part IITEM 1. BUSINESSDuPont was founded in 1802 and was incorporated in Delaware in 1915. DuPont brings world-class science and engineering to the global marketplace in theform of innovative products, materials and services. The company believes that by collaborating with customers, governments, non-governmentalorganizations and thought leaders it can help find solutions to such global challenges as providing enough healthy food for people everywhere, decreasingdependence on fossil fuels, and protecting life and the environment. Total worldwide employment at December 31, 2012, was about 70,000 people. Thecompany has operations in more than 90 countries worldwide and about 60 percent of consolidated net sales are made to customers outside the United Statesof America (U.S.). See Note 21 to the Consolidated Financial Statements for additional details on the location of the company's sales and property.Subsidiaries and affiliates of DuPont conduct manufacturing, seed production or selling activities and some are distributors of products manufactured by thecompany. As a science and technology based company, DuPont competes on a variety of factors such as product quality and performance or specifications,continuity of supply, price, customer service and breadth of product line, depending on the characteristics of the particular market involved and the productor service provided. Most products are marketed primarily through the company's sales force, although in some regions, more emphasis is placed on salesthrough distributors. The company utilizes numerous suppliers as well as internal sources to supply a wide range of raw materials, energy, supplies, servicesand equipment. To ensure availability, the company maintains multiple sources for fuels and many raw materials, including hydrocarbon feedstocks. Largevolume purchases are generally procured under competitively priced supply contracts.In third quarter 2012, the company entered into a definitive agreement to sell its Performance Coatings business (which represented a reportable segment) forapproximately $4.9 billion in cash and the assumption of certain liabilities. In accordance with generally accepted accounting principles in the U.S. (GAAP),the results of Performance Coatings are presented as discontinued operations and, as such, have been excluded from continuing operations and segment resultsfor all periods presented. On February 1, 2013, the sale of Performance Coatings was completed.Business SegmentsThe company consists of 13 businesses which are aggregated into eight reportable segments based on similar economic characteristics, the nature of theproducts and production processes, end-use markets, channels of distribution and regulatory environment. The company's reportable segments areAgriculture, Electronics & Communications, Industrial Biosciences, Nutrition & Health, Performance Chemicals, Performance Materials, Safety &Protection and Pharmaceuticals. The company includes certain embryonic businesses not included in the reportable segments, such as pre-commercialprograms, and nonaligned businesses in Other. Additional information with respect to business segment results is included in Item 7, Management'sDiscussion and Analysis of Financial Condition and Results of Operations, on page 22 of this report and Note 22 to the Consolidated Financial Statements.AgricultureAgriculture businesses, DuPont Pioneer and DuPont Crop Protection, leverage the company's technology, customer relationships and industry knowledge toimprove the quantity, quality and safety of the global food supply and the global production agriculture industry. Land available for worldwide agriculturalproduction is increasingly limited so production growth will need to be achieved principally through improving crop yields and productivity rather thanthrough increases in planted area. The segment's businesses deliver a broad portfolio of products and services that are specifically targeted to achieve gains incrop yields and productivity, including Pioneer® brand seed products and well-established brands of insecticides, fungicides and herbicides. Research anddevelopment focuses on leveraging technology to increase grower productivity and enhance the value of grains and soy through improved seed traits, superiorseed germplasm and effective use of insecticides, herbicides and fungicides. Agriculture accounted for approximately 50 percent of the company's totalresearch and development expense in 2012.Sales of the company's products in the segment are affected by the seasonality of global agriculture markets and weather patterns. Sales and earningsperformance in the Agriculture segment are strongest in the first half of the year reflecting the northern hemisphere planting season. The segment generallyoperates at a loss during the third and fourth quarters of the year. As a result of the seasonal nature of its business, Agriculture's inventory is at its highest levelat the end of the calendar year and is sold down in the first and second quarters. Trade receivables in the Agriculture segment are at a low point at year-end andincrease through the selling season to peak at the end of the second quarter.Pioneer is a world leader in developing, producing and marketing corn hybrid and soybean varieties which improve the productivity and profitability of itscustomers. Additionally, Pioneer develops, produces and markets canola, sunflower, sorghum, inoculants, wheat and rice. As the world's population growsand the middle class expands, the need for crops for animal feed, food, biofuels and industrial uses continues to increase. The business competes with otherseed and plant biotechnology companies. Pioneer2Part IITEM 1. BUSINESS, continuedseed sales amounted to 21 percent, 19 percent and 19 percent of the company's total consolidated net sales for the years ended December 31, 2012, 2011 and2010, respectively.Pioneer's research and development focuses on integrating high yielding germplasm with value added proprietary and/or licensed native and biotechnologytraits with local environment and service expertise. Pioneer uniquely develops integrated products for specific regional application based on local productadvancement and testing of the product concepts. Research and development in this arena requires long-term commitment of resources, extensive regulatoryefforts and collaborations, partnerships and business arrangements to successfully bring products to market. Pioneer licenses biotechnology traits from thirdparties as a normal course of business. To protect its investment, the business employs the use of patents covering germplasm and native and biotechnologytraits in accordance with country laws.Pioneer is actively pursuing the development of innovations for corn hybrid, soybean varieties, canola, sunflower, wheat and rice based on marketassessments of the most valuable opportunities. In corn hybrids, programs include innovations for drought and nitrogen efficiency, insect protection andherbicide tolerance. In soybean varieties, programs include products with high oleic content, multiple herbicide tolerance and insect protection.Pioneer has seed production facilities located throughout the world. Seed production is performed directly by the business or contracted with independentgrowers and conditioners. Pioneer's ability to produce seeds primarily depends upon weather conditions and availability of reliable contract growers.Pioneer markets and sells seed product primarily under the Pioneer® brand but also sells and distributes products utilizing additional brand names. Pioneerpromotes its products through multiple marketing channels around the world. In the corn and soybean markets of the U.S. Corn Belt, Pioneer® brandproducts are sold primarily through a specialized force of independent sales representatives. Outside of North America, Pioneer's products are marketedthrough a network of subsidiaries, joint ventures and independent producer-distributors.DuPont Crop Protection serves the global production agriculture industry with crop protection products for field crops such as wheat, corn, soybean and rice;specialty crops such as fruit, nut, vine and vegetables; and non-crop segments, including forestry and land management. Principle crop protection productsare weed control, disease control and insect control offerings. Crop Protection products are marketed and sold to growers and other end users through anetwork of wholesale distributors and crop input retailers. The sales growth of the business' insect control portfolio is led by DuPontTM Rynaxypyr®insecticide, a product registered for sale in 80 countries and sold under four key brands for use across a broad range of core agricultural crops.The major commodities, raw materials and supplies for the Agriculture segment include: benzene and carbamic acid related intermediates, copper, corn andsoybean seeds, insect control products, natural gas, seed treatments and sulfonamides.Agriculture segment sales outside the U.S. accounted for 53 percent of the segment's total sales in 2012.Electronics & CommunicationsElectronics & Communications (E&C) is a leading supplier of differentiated materials and systems for photovoltaics (PV), consumer electronics, displaysand advanced printing that enable superior performance and lower total cost of ownership for customers. The segment leverages the company's strongmaterials and technology base to target attractive growth opportunities in PV materials, circuit and semiconductor fabrication and packaging materials,display materials, packaging graphics, and ink-jet printing. In the growing PV market, E&C continues to be an industry-leading innovator and supplier ofmetalization pastes and backsheet materials that improve the efficiency and lifetime of solar cells and modules. In 2012, the segment commercialized newDuPontTM Solamet® PV metallization paste to drive step-change gains in efficiency of solar cells. DuPont is a leading global supplier of materials to the PVindustry.In the displays market, E&C has developed solution-process technology, which it licenses, and a growing range of materials for active matrix organic lightemitting diode (AMOLED) television displays. The segment has a broad portfolio of materials for semiconductor fabrication and packaging, as well asinnovative materials for circuit applications, to address critical needs of electronic component and device manufacturers. In consumer electronics, E&Cmaterials add value in the high growth hand-held markets of tablets and smart phones. In packaging graphics, E&C is a leading supplier of flexographicprinting systems, including Cyrel® photopolymer plates and platemaking systems. The segment is investing in new products to strengthen its marketleadership position in advanced printing markets. The segment is also expanding its leadership position in black-pigmented inks and developing new color-pigmented inks for network printing applications.3Part IITEM 1. BUSINESS, continuedThe major commodities, raw materials and supplies for E&C include: block co-polymers, copper, difluoroethane, hydroxylamine, oxydianiline, polyesterfilm, precious metals and pyromellitic dianhydride.E&C segment sales outside the U.S. accounted for 84 percent of the segment's total sales in 2012.Industrial BiosciencesIndustrial Biosciences is a leader in developing and manufacturing a broad portfolio of enzymes. The segment's enzymes add value and functionality to abroad range of products and processes such as animal nutrition, detergents, food manufacturing, ethanol production and industrial applications resulting incost and process benefits, better product performance and improved environmental outcomes. Industrial Biosciences also makes DuPontTM Sorona® PTTrenewably sourced polymer for use in carpet and apparel fibers. The segment includes a joint venture with Tate & Lyle PLC, DuPont Tate and Lyle Bio Products LLC, to produce BioPDOTM 1,3 propanediol using aproprietary fermentation and purification process. BioPDOTM is the key building block for DuPontTM Sorona® PTT polymer.The major commodities, raw materials and supplies for the Industrial Biosciences segment include: glucoamylase, glycols, grain products, such as dextroseand glucose, and purified terephthalic acid.Industrial Biosciences segment sales outside the U.S. accounted for 54 percent of the segment's total sales in 2012.Nutrition & HealthNutrition & Health is a premier provider of innovative solutions for specialty food ingredients, health and safety. The segment's products, which includecultures, emulsifiers, gums, natural sweeteners and soy-based food ingredients, hold leading market positions based on industry leading innovation, relevantproduct portfolio and close-partnering with the world's food manufacturers. Nutrition & Health serves various end markets within the food industry includingmeat, dairy, beverages and bakery segments. Nutrition & Health has research, production and distribution operations around the world. Nutrition & Health products are marketed and sold under a variety of brand names and are distributed primarily through its direct route to market. The directroute to market focuses on strong customer collaborations and insights with multinational customers and regional customers alike. The major commodities, raw materials and supplies for the Nutrition & Health segment include: acetyls, citrus peels, glycerin, grain products, locust beangum, oils and fats, seaweed, soybean, soy flake, sugar and yeast.Nutrition & Health segment sales outside the U.S. accounted for 69 percent of the segment's total sales in 2012.Performance ChemicalsPerformance Chemicals businesses, DuPont Titanium Technologies and DuPont Chemicals and Fluoroproducts, deliver customized solutions with a widerange of industrial and specialty chemical products for markets including plastics and coatings, textiles, mining, pulp and paper, water treatment andhealthcare.DuPont Titanium Technologies is the world's largest manufacturer of titanium dioxide, and is dedicated to creating greater value for the coatings, paper,plastics, specialties and minerals markets through service, brand and product. The business' main products include its broad line of DuPontTM Ti-Pure®titanium dioxide products. In 2011, the business announced a global expansion to support increased customer demand for titanium dioxide, including a $500million investment in new production facilities at the company's Altamira, Mexico site scheduled for completion in 2015. In addition, the business continuesto invest in facility upgrades to improve productivity at its other global manufacturing sites.DuPont Chemicals and Fluoroproducts is a leading global manufacturer of industrial and specialty fluorochemicals, fluoropolymers and performancechemicals. The business' broad line of products that include refrigerants, lubricants, propellants, solvents, fire extinguishants and electronic gases, cover awide range of industries and markets. Key brands include DuPontTM Teflon®, Capstone®, Dymel®, OpteonTM yf, Isceon®, Suva®, Vertrel®, Zyron®, Vazo®and Virkon®.The major commodities, raw materials and supplies for the Performance Chemicals segment include: ammonia, benzene, chlorine, chloroform, fluorspar,hydrofluoric acid, industrial gases, methanol, natural gas, perchloroethylene, petroleum coke, sulfur and titanium ore.4Part IITEM 1. BUSINESS, continuedPerformance Chemicals segment sales outside the U.S. accounted for 56 percent of the segment's total sales in 2012.Performance MaterialsPerformance Materials businesses, Performance Polymers and Packaging & Industrial Polymers, provide productive, higher performance polymers,elastomers, films, parts, and systems and solutions which improve the uniqueness, functionality and profitability of its customers' offerings. The keymarkets served by the segment include the automotive original equipment manufacturers (OEMs) and associated after-market industries, as well as electrical,packaging, construction, oil, electronics, photovoltaics, aerospace, chemical processing and consumer durable goods. The segment has several largecustomers, primarily in the motor vehicle OEM industry supply chain. The company has long-standing relationships with these customers and they areconsidered to be important to the segment's operating results.Performance Polymers delivers a broad range of polymer-based high performance materials in its product portfolio, including elastomers and thermoplasticand thermoset engineering polymers which are used by customers to fabricate components for mechanical, chemical and electrical systems. The mainproducts include: DuPontTM Zytel® nylon resins, Delrin® acetal resins, Hytrel® polyester thermoplastic elastomer resins, Tynex® filaments, Vespel® parts andshapes, Vamac® ethylene acrylic elastomer, Kalrez® perfluoroelastomer and Viton® fluoroelastomers. Performance Polymers also includes the DuPont TeijinFilms joint venture, whose primary products are Mylar® and Melinex® polyester films.Packaging & Industrial Polymers specializes in resins and films used in packaging and industrial polymer applications, sealants and adhesives, sportinggoods, and interlayers for laminated safety glass. Key brands include: DuPontTM Surlyn® ionomer resins, Bynel® coextrudable adhesive resins, Elvax® EVAresins, SentryGlas®, Butacite® laminate interlayers and Elvaloy® copolymer resins.The major commodities, raw materials and supplies for the Performance Materials segment include: acrylic monomers, adipic acid, butadiene, butanediol,dimethyl terephthalate, ethane, fiberglass, hexamethylenediamine, methanol, natural gas and purified terephthalic acid.Performance Materials segment sales outside the U.S. accounted for 69 percent of the segment's total sales in 2012.Safety & ProtectionSafety & Protection businesses, Protection Technologies, Sustainable Solutions and Building Innovations, satisfy the growing global needs of businesses,governments and consumers for solutions that make life safer, healthier and more secure. By uniting market-driven science with the strength of highlyregarded brands, the segment delivers products and services to a large number of markets, including construction, transportation, communications, industrialchemicals, oil and gas, electric utilities, automotive, manufacturing, defense, homeland security and safety consulting.Protection Technologies is focused on finding solutions to protect people and the environment. With products like DuPont™ Kevlar® high strength material,Nomex® thermal resistant material and Tyvek® protective material, the business continues to hold strong positions in life protection markets and meet thecontinued demand for body armor and personal protective gear for the military, law enforcement personnel, firefighters and other first responders, as well asfor workers in the oil and gas industry around the world. In 2011, the business announced the start up of its $500 million Cooper River Kevlar® facility nearCharleston, South Carolina. The Cooper River Kevlar® plant uses state-of-the-art technology that will allow the business to meet increased customer demandfor advanced protective materials in emerging industries around the world by expanding its portfolio of science-based innovations and boosting productivity.Commercial supply began at the end of 2011.Sustainable Solutions continues to help organizations worldwide reduce workplace injuries and fatalities while improving operating costs, productivity andquality. Sustainable Solutions is a leader in the safety consulting field, selling training products, as well as consulting services. Additionally, SustainableSolutions is dedicated to clean air, clean fuel and clean water with offerings that help reduce sulfur and other emissions, formulate cleaner fuels, or dispose ofliquid waste. Its goal is to help maintain business continuity and environmental compliance for companies in the refining and petrochemical industries, as wellas for government entities. The business includes MECS, Inc. (MECS), which is a leading global provider of process technology, proprietary specialtyequipment and technical services to the sulfuric acid industry.5Part IITEM 1. BUSINESS, continuedBuilding Innovations is committed to the building science behind increasing the performance of building systems, helping reduce operating costs and creatingmore sustainable structures. The business is a market leader of solid surfaces through its DuPontTM Corian® and Montelli® lines of products which offerdurable and versatile materials for residential and commercial purposes. Other products such as DuPont™ Tyvek® and Typar® offer leading solutions for theprotection and energy efficiency of buildings.The major commodities, raw materials and supplies for the Safety & Protection segment include: alumina hydroxide, benzene, high density polyethylene,isophthaloyl chloride, metaphenylenediamine, methyl methacrylate, paraphenylenediamine, polyester fiber, terephthaloyl chloride and wood pulp.Safety & Protection segment sales outside the U.S. accounted for 62 percent of the segment's total sales in 2012.PharmaceuticalsOn October 1, 2001, DuPont Pharmaceuticals was sold to the Bristol-Myers Squibb Company. DuPont retained its interest in Cozaar® (losartan potassium)and Hyzaar® (losartan potassium with hydrochlorothiazide), which are used in the treatment of hypertension. DuPont has exclusively licensed worldwidemarketing and manufacturing rights for Cozaar® and Hyzaar® to Merck & Co., Inc. (Merck).Pharmaceuticals' Cozaar®/Hyzaar® income is the sum of two parts: income related to a share of the profits from North American sales and certain markets inEurope, and royalty income derived from worldwide contract net sales linked to the exclusivity term in a particular country. Patents and exclusivity started toexpire in prior years and the U.S. exclusivity for Cozaar® ended in April 2010. The worldwide agreement with Merck expired December 31, 2012. Thecompany expects 2013 earnings to be insignificant.BacklogIn general, the company does not manufacture its products against a backlog of orders and does not consider backlog to be a significant indicator of the levelof future sales activity. Production and inventory levels are based on the level of incoming orders as well as projections of future demand. Therefore, thecompany believes that backlog information is not material to understanding its overall business and should not be considered a reliable indicator of thecompany's ability to achieve any particular level of revenue or financial performance.Intellectual PropertyDuPont believes that its intellectual property estate provides it with an important competitive advantage. It has an established global network of attorneys, aswell as branding, advertising and licensing professionals, to procure, maintain, protect, enhance and gain value from this estate.The company has access to a large patent portfolio, both owned and licensed. These definite-lived patents cover many products, processes and product uses.These patents protect many aspects of the company's significant research programs and the goods and services it sells. The actual protection afforded by thesepatents varies from country to country and depends upon the scope of coverage of each individual patent as well as the availability of legal remedies in eachcountry. DuPont owns about 25,635 worldwide patents and is awaiting action on about 20,925 worldwide patent applications. In 2012, the company wasgranted about 935 U.S. patents and about 2,910 international patents. DuPont's rights under its patents and licenses, as well as the products made and soldunder them, are important to the company as a whole, and to varying degrees, important to each reportable segment.Trade secrets are an important element of the company's intellectual property. Many of the processes used to make DuPont products are kept as trade secretswhich, from time to time, may be licensed to third parties. DuPont vigilantly protects all of its intellectual property including its trade secrets. When thecompany discovers that its trade secrets have been unlawfully taken, it reports the matter to governmental authorities for investigation and potential criminalaction, as appropriate. In addition, the company takes measures to mitigate any potential impact, which may include civil actions seeking redress, restitutionand/or damages based on loss to the company and/or unjust enrichment.Ownership of and access to intellectual property rights, particularly those relating to biotechnology and germplasm, will continue to be important to Pioneerand its competitors. The environment in which Pioneer competes is characterized by the use among competitors of intellectual property rights, including patentlawsuits, to gain advantage in commercial markets. In support of its business, Pioneer continues to build a large collection of intellectual property rights relatedto biotechnology and germplasm and to license technology from others, including competitors. Pioneer endeavors to obtain such licenses on commerciallyreasonable terms.6Part IITEM 1. BUSINESS, continuedThe company has about 2,065 unique trademarks for its products and services and approximately 19,395 registrations for these trademarks worldwide.Ownership rights in trademarks do not expire if the trademarks are continued in use and properly protected. The company has many trademarks that havesignificant recognition at the consumer retail level and/or business to business level.Research and DevelopmentThe company conducts research at either dedicated research facilities or manufacturing plants. There are eleven major research locations in the U.S. &Canada, with the highest concentration of facilities being located in the Wilmington, Delaware area. Reflecting the company's global interests, five majorresearch locations are located in the Asia Pacific region, four major research locations are located in Europe, Middle East and Africa (EMEA) region and onemajor location is located in Latin America.The objectives of the company's research and development programs are to create new technologies, processes and business opportunities in relevant fields, aswell as to improve existing products and processes. Each segment of the company funds research and development activities that support its businessmission. The company is expanding its offerings addressing safety, environment, energy and climate challenges in the global marketplace by developing andcommercializing renewable, bio-based materials; advanced biofuels; energy-efficient technologies; enhanced safety and protection products; and alternativeenergy products and technologies. The goals are tied directly to business growth, including increasing food production, increasing renewable sources forenergy and raw materials, and providing greater safety and protection for people and the environment. All research and development activities are administeredby senior research and development management to ensure consistency with the business and corporate strategy. The future of the company is not dependentupon the outcome of any single research program.Additional information with respect to research and development, including the amount incurred during each of the last three fiscal years, is included inItem 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, on page 20 of this report.Environmental MattersInformation related to environmental matters is included in several areas of this report: (1) Environmental Proceedings beginning on page 12, (2) Management'sDiscussion and Analysis of Financial Condition and Results of Operations beginning on pages 31, 35-37 and (3) Notes 1 and 16 to the ConsolidatedFinancial Statements.Available InformationThe company is subject to the reporting requirements under the Securities Exchange Act of 1934. Consequently, the company is required to file reports andinformation with the Securities and Exchange Commission (SEC), including reports on the following forms: annual report on Form 10-K, quarterly reports onForm 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities ExchangeAct of 1934.The public may read and copy any materials the company files with the SEC at the SEC's Public Reference Room at 100 F Street, NE, Washington, DC20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains anInternet site at http://www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically withthe SEC.The company's annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports are alsoaccessible on the company's website at http://www.dupont.com by clicking on the section labeled "Investors", then on "Key Financials & Filings" and then on"SEC Filings." These reports are made available, without charge, as soon as is reasonably practicable after the company files or furnishes them electronicallywith the SEC.Executive Officers of the RegistrantInformation related to the company's Executive Officers is included in Item 10, Directors, Executive Officers and Corporate Governance, beginning on page 40of this report.7Part IITEM 1A. RISK FACTORSThe company's operations could be affected by various risks, many of which are beyond its control. Based on current information, the company believes thatthe following identifies the most significant risk factors that could affect its businesses. Past financial performance may not be a reliable indicator of futureperformance and historical trends should not be used to anticipate results or trends in future periods.Price increases for energy and raw materials could have a significant impact on the company's ability to sustain and grow earnings.The company's manufacturing processes consume significant amounts of energy and raw materials, the costs of which are subject to worldwide supply anddemand as well as other factors beyond the control of the company. Significant variations in the cost of energy, which primarily reflect market prices for oil,natural gas and raw materials, affect the company's operating results from period to period. Price increases for energy and raw materials were not significant toearnings in 2012 as compared to 2011. In 2011, price increases for energy and raw materials were about $2.0 billion as compared to 2010. Legislation toaddress climate change by reducing greenhouse gas emissions and establishing a price on carbon could create increases in energy costs and price volatility.When possible, the company purchases raw materials through negotiated long-term contracts to minimize the impact of price fluctuations. Additionally, thecompany enters into over-the-counter and exchange traded derivative commodity instruments to hedge its exposure to price fluctuations on certain raw materialpurchases. The company takes actions to offset the effects of higher energy and raw material costs through selling price increases, productivity improvementsand cost reduction programs. Success in offsetting higher raw material costs with price increases is largely influenced by competitive and economic conditionsand could vary significantly depending on the market served. If the company is not able to fully offset the effects of higher energy and raw material costs, itcould have a significant impact on the company's financial results.Failure to develop and market new products and manage product life cycles could impact the company's competitive position and have anadverse effect on the company's financial results.Operating results are largely dependent on the company's assessment and management of its portfolio of current, new and developing products and servicesand its ability to bring those products and services to market. The company plans to grow earnings by focusing on solutions to meet increasing demand forfood productivity, decrease dependency on fossil fuels, and protect people, assets and the environment. The company develops new products through multiplemethods including, but not limited to, internal research, collaborations, acquisitions, joint ventures and licensing technology or know-how. Developing andmarketing new products could be adversely affected by difficulties or delays in product development such as the inability to identify viable new products,successfully complete research and development, obtain and maintain relevant regulatory approvals, obtain and maintain intellectual property protection,obtain technology or gain market acceptance of new products and services. Because of the lengthy development process, technological challenges and intensecompetition, there can be no assurance that any of the products the company is currently developing, or in which it will invest to develop, will achievesubstantial commercial success. Not currently matching investment choices in new products with market need and competitive offerings could adverselyaffect business performance. Sales of the company's new products could replace sales of some of its current products, offsetting the benefit of even asuccessful product introduction.The company competes with major global companies that have strong intellectual property estates supporting the use of biotechnology to enhance products,particularly agricultural and bio-based products. Speed in discovering, developing and protecting new technologies and bringing related products to market isa significant competitive advantage. Failure to predict and respond effectively to this competition could cause the company's existing or candidate products tobecome less competitive, adversely affecting sales. Competitors are increasingly challenging intellectual property positions and the outcomes can be highlyuncertain. If challenges are resolved adversely, it could negatively impact the company's ability to commercialize new products and generate sales from existingproducts.The company's results of operations could be adversely affected by litigation and other commitments and contingencies.The company faces risks arising from various unasserted and asserted litigation matters, including, but not limited to, product liability, patent infringement,antitrust claims, and claims for third party property damage or personal injury stemming from alleged environmental torts. The company has noted anationwide trend in purported class actions against chemical manufacturers generally seeking relief such as medical monitoring, property damages, off-siteremediation and punitive damages arising from alleged environmental torts without claiming present personal injuries. The company also has noted a trend inpublic and private nuisance suits being filed on behalf of states, counties, cities and utilities alleging harm to the general public. Various factors ordevelopments can lead to changes in current estimates of liabilities such as a final adverse judgment, significant settlement or changes in applicable law. Afuture adverse ruling or unfavorable development could result in future charges that could have a material adverse effect on the company. An adverse outcomein any one or more of these matters could be material to the company's financial results.8Part IITEM 1A. RISK FACTORS, continuedIn the ordinary course of business, the company may make certain commitments, including representations, warranties and indemnities relating to currentand past operations, including those related to divested businesses and issue guarantees of third party obligations. If the company were required to makepayments as a result, they could exceed the amounts accrued, thereby adversely affecting the company's results of operations.The company's business, including its results of operations and reputation, could be adversely affected by process safety and productstewardship issues.Failure to appropriately manage safety, human health, product liability and environmental risks associated with the company's products, product life cyclesand production processes could adversely impact employees, communities, stakeholders, the environment, the company's reputation and its results ofoperations. Public perception of the risks associated with the company's products and production processes could impact product acceptance and influence theregulatory environment in which the company operates. While the company has procedures and controls to manage process safety risks, issues could becreated by events outside of its control including natural disasters, severe weather events, acts of sabotage and substandard performance by the company'sexternal partners.As a result of the company's current and past operations, including operations related to divested businesses, the company could incur significantenvironmental liabilities.The company is subject to various laws and regulations around the world governing the environment, including the discharge of pollutants and themanagement and disposal of hazardous substances. As a result of its operations, including its past operations and operations of divested businesses, thecompany could incur substantial costs, including remediation and restoration costs. The costs of complying with complex environmental laws andregulations, as well as internal voluntary programs, are significant and will continue to be so for the foreseeable future. The ultimate costs under environmentallaws and the timing of these costs are difficult to predict. The company's accruals for such costs and liabilities may not be adequate because the estimates onwhich the accruals are based depend on a number of factors including the nature of the matter, the complexity of the site, site geology, the nature and extent ofcontamination, the type of remedy, the outcome of discussions with regulatory agencies and other Potentially Responsible Parties (PRPs) at multi-party sitesand the number and financial viability of other PRPs.Market acceptance, government policies, rules or regulations and competition could affect the company's ability to generate sales from productsbased on biotechnology.The company is using biotechnology to create and improve products, particularly in its Agriculture and Industrial Biosciences segments. The use ofbiotechnology to characterize the genetic and performance characteristics of Pioneer seeds provides Pioneer with competitive advantages in the development ofnew products, and in the most effective placement of those products on customer planted area. Industrial Biosciences leverages the company's biotechnologycapabilities to develop and manufacture a broad portfolio of enzymes and biomaterials. These products enable cost and process benefits, better productperformance and improve environmental outcomes to a broad range of products and processes such as animal nutrition, detergents, food manufacturing,ethanol production and industrial applications. The company's ability to generate sales from such products could be impacted by market acceptance as well asgovernmental policies, laws and regulations that affect the development, manufacture and distribution of products, including the testing and planting of seedscontaining biotechnology traits and the import of commodity grain grown from those seeds. The regulatory environment is lengthy and complex withrequirements that can vary by industry and by country. The regulatory environment may be impacted by the activities of non-governmental organizations andspecial interest groups and stakeholder reaction to actual or perceived impacts of new technology on safety, health and the environment. Obtaining andmaintaining regulatory approvals requires submitting a significant amount of information and data, which may require participation from technologyproviders. The ability to satisfy the requirements of regulatory agencies is essential to be able to continue to sell existing products or commercialize newproducts.Changes in government policies and laws could adversely affect the company's financial results.Sales to customers outside the U.S. constitute about 60 percent of the company's 2012 revenue. The company anticipates that international sales will continueto represent a substantial portion of its total sales and that continued growth and profitability will require further international expansion, particularly indeveloping markets. Sales from developing markets represent 34 percent of the company's revenue in 2012 and the company's growth plans include focusingon expanding its presence in developing markets. The company's financial results could be affected by changes in trade, monetary and fiscal policies, lawsand regulations, or other activities of U.S. and non-U.S. governments, agencies and similar organizations. These conditions include, but are not limited to,changes in a country's or region's economic or political conditions, trade regulations affecting production, pricing and marketing of products, local laborconditions and regulations, reduced protection of intellectual property rights in some countries, changes in the regulatory or legal environment, restrictions oncurrency exchange activities, burdensome taxes and tariffs and9Part IITEM 1A. RISK FACTORS, continuedother trade barriers. International risks and uncertainties, including changing social and economic conditions as well as terrorism, political hostilities and war,could lead to reduced sales and profitability.Economic factors, including inflation, deflation and fluctuations in currency exchange rates, interest rates and commodity prices could affect thecompany's financial results.The company is exposed to fluctuations in currency exchange rates, interest rates and commodity prices. Because the company has significant internationaloperations, there are a large number of currency transactions that result from international sales, purchases, investments and borrowings. The companyactively manages currency exposures that are associated with net monetary asset positions, committed currency purchases and sales, foreign currency-denominated revenues and other assets and liabilities created in the normal course of business. Failure to successfully manage these risks could have anadverse impact on the company's financial position, results of operations and cash flows.Conditions in the global economy and global capital markets may adversely affect the company's results of operations, financial condition, andcash flows.The company's business and operating results may in the future be adversely affected by global economic conditions, including instability in credit markets,declining consumer and business confidence, fluctuating commodity prices, volatile exchange rates, and other challenges that could affect the global economy.The company's customers may experience deterioration of their businesses, cash flow shortages, and difficulty obtaining financing. As a result, existing orpotential customers may delay or cancel plans to purchase products and may not be able to fulfill their obligations in a timely fashion. Further, supplierscould experience similar conditions, which could impact their ability to fulfill their obligations to the company. Adversity within capital markets may impactfuture return on pension assets, thus resulting in greater future pension costs that impact the company's results. Future weakness in the global economy couldadversely affect the company's results of operations, financial condition and cash flows in future periods.The company's results of operations and financial condition could be seriously impacted by business disruptions and security breaches, includingcybersecurity incidents.Business and/or supply chain disruptions, plant and/or power outages and information technology system and/or network disruptions, regardless of causeincluding acts of sabotage, employee error or other actions, geo-political activity, weather events and natural disasters could seriously harm the company'soperations as well as the operations of its customers and suppliers. Failure to effectively prevent, detect and recover from security breaches, including attackson information technology and infrastructure by hackers; viruses; breaches due to employee error or actions; or other disruptions could result in misuse of thecompany's assets, business disruptions, loss of property including trade secrets and confidential business information, legal claims or proceedings, reportingerrors, processing inefficiencies, negative media attention, loss of sales and interference with regulatory compliance. Although management does not believe thatthe company has experienced any material losses to date related to security breaches, including cybersecurity incidents, there can be no assurance that it willnot suffer such losses in the future. The company actively manages the risks within its control that could lead to business disruptions and security breaches.As these threats continue to evolve, particularly around cybersecurity, the company may be required to expend significant resources to enhance its controlenvironment, processes, practices and other protective measures. Despite these efforts, such events could materially adversely affect the company's business,financial condition or results of operations.Inability to protect and enforce the company's intellectual property rights could adversely affect the company's financial results.Intellectual property rights, including patents, plant variety protection, trade secrets, confidential information, trademarks, tradenames and other forms oftrade dress, are important to the company's business. The company endeavors to protect its intellectual property rights in jurisdictions in which its productsare produced or used and in jurisdictions into which its products are imported. However, the company may be unable to obtain protection for its intellectualproperty in key jurisdictions. The company has designed and implemented internal controls to restrict access to and distribution of its intellectual property.Despite these precautions, the company's intellectual property is vulnerable to unauthorized access through employee error or actions, theft and cybersecurityincidents, and other security breaches. When unauthorized access and use or counterfeit products are discovered, the company reports such situations togovernmental authorities for investigation, as appropriate, and takes measures to mitigate any potential impact.10Part IITEM 1B. UNRESOLVED STAFF COMMENTSNone.ITEM 2. PROPERTIESThe company's corporate headquarters are located in Wilmington, Delaware. The company's manufacturing, processing, marketing and research anddevelopment facilities, as well as regional purchasing offices and distribution centers are located throughout the world.Information regarding research and development facilities is incorporated by reference to Item 1, Business-Research and Development. Additional informationwith respect to the company's property, plant and equipment and leases is contained in Notes 10, 16 and 21 to the Consolidated Financial Statements.The company has investments in property, plant and equipment related to global manufacturing operations. Collectively there are over 300 principal sites intotal. The number of sites used by their applicable segment(s) by major geographic area around the world is as follows: Number of Sites AgricultureElectronics &CommunicationsIndustrial BiosciencesNutrition & HealthPerformanceChemicalsPerformanceMaterialsSafety & ProtectionTotal 1Asia Pacific1910110619772EMEA173720411567Latin America17—1711—27U.S. & Canada5618612291911151 1093115494050233171.Sites that are used by multiple segments are included more than once in the figures above.The company's plants and equipment are well maintained and in good operating condition. The company believes it has sufficient capacity to meet demand in2013. Properties are primarily owned by the company; however, certain properties are leased. No title examination of the properties has been made for thepurpose of this report and certain properties are shared with other tenants under long-term leases.DuPont recognizes that the security and safety of its operations are critical to its employees, community and to the future of the company. As such, thecompany has merged chemical site security into its safety core value where it serves as an integral part of its long standing safety culture. Physical securitymeasures have been combined with process safety measures (including the use of inherently safer technology), administrative procedures and emergencyresponse preparedness into an integrated security plan. The company has conducted vulnerability assessments at operating facilities in the U.S. and highpriority sites worldwide and identified and implemented appropriate measures to protect these facilities from physical and cyber attacks. DuPont is partneringwith carriers, including railroad, shipping and trucking companies, to secure chemicals in transit.11Part IITEM 3. LEGAL PROCEEDINGSThe company is subject to various litigation matters, including, but not limited to, product liability, patent infringement, antitrust claims, and claims forthird party property damage or personal injury stemming from alleged environmental torts. Information regarding certain of these matters is set forth below andin Note 16 to the Consolidated Financial Statements.LitigationImprelis® Herbicide Claims ProcessInformation related to this matter is included in Note 16 to the Consolidated Financial Statements under the heading Imprelis®.PFOA: Environmental and Litigation ProceedingsFor purposes of this report, the term PFOA means collectively perfluorooctanoic acid and its salts, including the ammonium salt and does not distinguishbetween the two forms. Information related to this matter is included in Note 16 to the Consolidated Financial Statements under the heading PFOA.Monsanto Patent DisputeInformation related to this matter is included in Note 16 to the Consolidated Financial Statements under the heading Monsanto Patent Dispute.Environmental ProceedingsBelle Plant, West VirginiaThe U.S. Environmental Protection Agency (EPA) is investigating three chemical releases at DuPont's Belle facility in West Virginia which occurred in January2010. One of the releases involved the death of a DuPont employee after exposure to phosgene.Chambers Works Plant, Deepwater, New JerseyIn 2010, the government initiated an enforcement action alleging that the facility violated recordkeeping requirements of certain provisions of the Clean Air Act(CAA) and the Federal Clean Air Act Regulations (FCAR) governing Leak Detection and Reporting (LDAR) and that it failed to report emissions of acompound from Chambers Works' waste water treatment facility under the Emergency Planning and Community Right-to-Know Act. The alleged non-compliance was identified by EPA in 2007 and 2009 following separate environmental audits. DuPont is in settlement negotiations with EPA and theDepartment of Justice (DOJ).LaPorte Plant, LaPorte, TexasEPA conducted a multimedia inspection at the LaPorte facility in January 2008. DuPont, EPA and DOJ began discussions in the fall of 2011 relating primarilyto the management of certain materials in the facility's wastewater treatment system. These negotiations continue.Sabine Plant, Orange, TexasIn June 2012, DuPont received allegations related to a multimedia inspection that the EPA conducted at the Sabine facility in March 2009. DuPont, EPA andDOJ are in discussions relating to the management of materials in the facility's waste water treatment system, hazardous waste management and air emissions.Yerkes Plant, Buffalo, New YorkThe government alleges that the facility violated recordkeeping requirements of certain provisions of the CAA and FCAR governing LDAR and that it failed toaccurately report emissions under the Emergency Planning and Community Right-to-Know Act. The alleged non-compliance was identified by EPA in 2006and 2010 following separate environmental audits. DuPont is in settlement negotiations with EPA and DOJ.Federal Insecticide, Fungicide and Rodenticide Act (FIFRA)In July 2012, DuPont received a “notice of noncompliance and show cause” letter from EPA Region III for alleged violations of FIFRA related to productlabeling and adverse effects reporting for Imprelis®.Washington Works Plant, West VirginiaIn 2011, the U.S. government initiated an enforcement action alleging that the Washington Works plant violated certain regulatory provisions of the CAAgoverning LDAR. The alleged non-compliance was identified between 2007 and 2010, following an environmental audit conducted in 2007 and the submissionof responses to an information request received in 2009. DuPont is in settlement negotiations with the EPA and DOJ.12Part IITEM 3. LEGAL PROCEEDINGS, continuedDuPont (Australia) Pty LimitedThe New South Wales Environmental Protection Authority (NSWEPA) alleges that 2011 dust particulate emissions from a DuPont (Australia) Pty Limitedfacility caused damage to trees, shrubs, and garden plants. In April 2012, NSWEPA commenced proceedings against DuPont (Australia) Pty Limited andunder applicable laws and regulations, fines of up to AUD 1,000,000 (approximately $1,000,000) can be imposed.ITEM 4. MINE SAFETY DISCLOSURESInformation regarding mine safety and other regulatory actions at the company's surface mine in Starke, Florida is included in Exhibit 95 to this report.13Part IIITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OFEQUITY SECURITIESMarket for Registrant's Common Equity and Related Stockholder MattersThe company's common stock is listed on the New York Stock Exchange, Inc. (symbol DD) and certain non-U.S. exchanges. The number of record holdersof common stock was approximately 73,000 at January 31, 2013.Holders of the company's common stock are entitled to receive dividends when they are declared by the Board of Directors. While it is not a guarantee of futureconduct, the company has continuously paid a quarterly dividend since the fourth quarter 1904. Dividends on common stock and preferred stock are usuallydeclared in January, April, July and October. When dividends on common stock are declared, they are usually paid mid March, June, Septemberand December. Preferred dividends are paid on or about the 25th of January, April, July and October. The Stock Transfer Agent and Registrar isComputershare Trust Company, N.A.The company's quarterly high and low trading stock prices and dividends per common share for 2012 and 2011 are shown below. Market Prices 2012HighLowPer ShareDividendDeclaredFourth Quarter$50.96$41.67$0.43Third Quarter52.3346.150.43Second Quarter53.9846.440.43First Quarter53.9545.840.41 2011 Fourth Quarter$49.92$37.10$0.41Third Quarter56.2039.940.41Second Quarter57.0048.640.41First Quarter56.1947.220.41Issuer Purchases of Equity SecuritiesThere were no purchases of the company's common stock during the three months ended December 31, 2012.14Part IIITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OFEQUITY SECURITIES, continuedStock Performance GraphThe following graph presents the cumulative five-year total return for the company's common stock compared with the S&P 500 Stock Index and the DowJones Industrial Average. 12/31/200712/31/200812/31/200912/31/201012/31/201112/31/2012DuPont$100$60$85$131$124$126S&P 500 Index10063809294109Dow Jones Industrial Average100688495103114The graph assumes that the values of DuPont common stock, the S&P 500 Stock Index and the Dow Jones Industrial Average were each $100 onDecember 31, 2007 and that all dividends were reinvested.15Part IIITEM 6. SELECTED FINANCIAL DATA(Dollars in millions, except per share)20122011201020092008Summary of operations1 Net sales$34,812$33,681$27,700$22,681$26,169Employee separation / asset related charges, net$493$53$(40)$195$331Income from continuing operations before income taxes$3,115$3,781$3,260$1,943$2,388Provision for income taxes on continuing operations$622$626$515$326$368Net income attributable to DuPont$2,788$3,474$3,031$1,755$2,007Basic earnings per share of common stock from continuing operations$2.63$3.35$2.99$1.76$2.22Diluted earnings per share of common stock from continuing operations$2.61$3.30$2.94$1.75$2.21Financial position at year-end Working capital2$7,642$6,873$9,670$7,898$5,601Total assets3$49,736$48,492$40,410$38,185$36,209Borrowings and capital lease obligations Short-term$1,275$817$133$1,506$2,012Long-term$10,465$11,736$10,137$9,528$7,638Total equity$10,179$9,062$9,743$7,651$7,552General1 For the year Purchases of property, plant & equipment and investments in affiliates$1,890$1,910$1,608$1,432$2,033Depreciation$1,319$1,199$1,118$1,144$967Research and development expense$2,067$1,910$1,603$1,324$1,326Average number of common shares outstanding (millions) Basic933928909904902Diluted942941922909907Dividends per common share$1.70$1.64$1.64$1.64$1.64At year-end Employees (thousands)7070605860Closing stock price$44.98$45.78$49.88$33.67$25.30Common stockholders of record (thousands)74788185881. Information has been restated to reflect the impact of discontinued operations, as applicable. See Note 1, Basis of Presentation, to the Consolidated Financial Statements for furtherinformation.2. At December 31, 2012, working capital includes approximately $2.0 billion of net assets related to the Performance Coatings business, of which approximately $1.3 billion waspreviously considered to be noncurrent and is now classified as held for sale. See Note 2 to the Consolidated Financial Statements for further information.3. During 2011, the company acquired approximately $8.8 billion of assets in connection with the Danisco acquisition. See Note 4 to the Consolidated Financial Statements for furtherinformation.16Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCAUTIONARY STATEMENTS ABOUT FORWARD-LOOKING STATEMENTSThis report contains forward-looking statements which may be identified by their use of words like “plans,” “expects,” “will,” “anticipates,” “believes,”“intends,” “projects,” “estimates” or other words of similar meaning. All statements that address expectations or projections about the future, includingstatements about the company's strategy for growth, product development, regulatory approval, market position, anticipated benefits of recent acquisitions,outcome of contingencies, such as litigation and environmental matters, expenditures and financial results, are forward-looking statements.Forward-looking statements are based on certain assumptions and expectations of future events which may not be accurate or realized. Forward-lookingstatements also involve risks and uncertainties, many of which are beyond the company's control. Some of the important factors that could cause thecompany's actual results to differ materially from those projected in any such forward-looking statements are:•Fluctuations in energy and raw material prices;•Failure to develop and market new products and optimally manage product life cycles;•Outcome of significant litigation and environmental matters, including those related to divested businesses;•Failure to appropriately manage process safety and product stewardship issues;•Effect of changes in tax, environmental and other laws and regulations or political conditions in the U.S. and other countries in which the companyoperates;•Conditions in the global economy and global capital markets, including economic factors, such as inflation, deflation and fluctuations in currencyexchange rates, interest rates and commodity prices, as well as regulatory requirements;•Impact of business disruptions, including supply disruptions, and security threats, regardless of cause, including acts of sabotage, cyber-attacks,terrorism or war, weather events and natural disasters;•Inability to protect and enforce the company's intellectual property rights; and•Successful integration of acquired businesses and completion of divestitures of underperforming or non-strategic assets or businesses.For some of the important factors that could cause the company's actual results to differ materially from those projected in any such forward-lookingstatements, see the Risk Factors discussion set forth under Part I, Item 1A beginning on page 8.OverviewPurpose DuPont is a science company. We work collaboratively to find sustainable, innovative, market-driven solutions to solve some of the world'sbiggest challenges, making lives better, safer, and healthier for people everywhere.Strategy The company's strategy for growth is to apply its science and technology to address three challenges driven by global population growth: feedingthe world, reducing our dependence on fossil fuels and keeping people and the environment safe. Critical areas for the company's growth are innovation,differential management and productivity. Applying science to deliver innovative solutions and new products in the marketplace generates shareholder valueand profitable growth. Differential management is a disciplined process to prioritize and allocate resources across businesses and geographies aligned withgrowth opportunities. The company continues to achieve fixed cost, working capital and variable cost productivity through disciplined business processescalled DuPont Integrated Business Management (DIBM) and DuPont Production System (DPS). DIBM focuses on the business supply chain to maximizeefficiency and optimize working capital, while DPS focuses on productivity outcomes to eliminate operational inefficiencies and improve lead time, cycle timeand quality. The company is committed to maintain a strong balance sheet and to return excess cash to shareholders unless there is a compelling opportunity toinvest for growth.Results In 2012, sales were up 3 percent as strong increases in the Agriculture, Nutrition & Health, and Industrial Biosciences segments were partly offsetby lower sales for the remaining segments, particularly Performance Chemicals. The latter had financial results reflecting a declining business trend afterreaching cyclical peaks for sales and earnings in 2011 and the first half of 2012. Total company sales grew 6 percent in developing markets, which includeChina, India, and the countries located in Latin America, Eastern and Central Europe, Middle East, Africa, and Southeast Asia. Sales of new productsintroduced in the last four years also contributed to sales growth. The company exceeded its three-year 2010-2012 plan of $1 billion fixed cost productivityactions and $1 billion working capital productivity.17Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedAnalysis of OperationsDivestiture of Performance Coatings In third quarter 2012, the company entered into a definitive agreement with Flash Bermuda Co. Ltd., a Bermudaexempted limited liability company formed by affiliates of The Carlyle Group (collectively referred to as "Carlyle") in which Carlyle agreed to purchase certainsubsidiaries and assets comprising the company's Performance Coatings business for approximately $4.9 billion in cash and the assumption of certainliabilities. On February 1, 2013, the sale of Performance Coatings was completed, resulting in about $4.0 billion in after-tax proceeds.In accordance with GAAP, the results of Performance Coatings are presented as discontinued operations and, as such, have been excluded from continuingoperations and segment results for all periods presented. See Note 2 to the Consolidated Financial Statements for additional information.Acquisition of Danisco In 2011, the company acquired Danisco in a transaction valued at $6.4 billion, plus net debt assumed of $0.6 billion. As part ofthis acquisition, DuPont incurred $85 million in transaction related costs during 2011, which were recorded in costs of goods sold and other operatingcharges. In 2011, the businesses acquired from Danisco contributed net sales of $1.7 billion and net income attributable to DuPont of $(7) million, whichexcludes $30 million after-tax ($39 million pre-tax) of additional interest expense related to the debt issued to finance the acquisition. Danisco's contributionsincluded a $125 million after-tax ($175 million pre-tax) charge related to the fair value step-up of inventories acquired and sold during 2011. See Note 4 to theConsolidated Financial Statements for additional information.(Dollars in millions)201220112010NET SALES$34,812$33,681$27,7002012 versus 2011 The table below shows a regional breakdown of 2012 consolidated net sales based on location of customers and percentage variances fromprior year: Percent Change Due to:(Dollars in billions)2012Net SalesPercentChange vs.2011LocalPriceCurrencyEffectVolumePortfolio / OtherWorldwide$34.834(2)(2)3U.S. & Canada14.286——2EMEA8.1(1)3(6)(4)6Asia Pacific8.0(4)(1)(1)(5)3Latin America4.5119(5)52Sales increased 3 percent, reflecting a 3 percent net increase from portfolio changes, principally the Danisco acquisition, and 4 percent higher local prices,partly offset by 2 percent lower volume and a 2 percent negative currency impact. The 2 percent decline in worldwide sales volume principally reflects higherAgriculture, Nutrition & Health, and Industrial Biosciences volume, more than offset by lower volume for the other segments combined, particularlyPerformance Chemicals. Higher local prices were driven principally by increases for seeds, titanium dioxide, and specialty polymers. Currency effectprimarily reflects the weaker Euro and Brazilian Real. Sales in developing markets of $11.9 billion improved 6 percent from 2011, and the percentage of totalcompany sales in these markets increased to 34 percent from 33 percent in 2011.18Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continued2011 versus 2010 The table below shows a regional breakdown of 2011 consolidated net sales based on location of customers and percentage variancesfrom 2010: Percent Change Due to:(Dollars in billions)2011Net SalesPercentChange vs.2010LocalPriceCurrencyEffectVolumePortfolio / OtherWorldwide$33.72212217U.S. & Canada13.1169—16EMEA8.226114—11Asia Pacific8.323173(3)6Latin America4.133142125Sales increased 22 percent, principally reflecting higher local selling prices and the sales added from businesses acquired from Danisco. Local selling priceswere significantly higher for titanium dioxide, seeds, fluoroproducts and electronic products, with the latter reflecting pass through pricing for higher preciousmetals costs. Worldwide sales volume increased 1 percent as strong volume growth in Agriculture was largely offset by declines in Electronic &Communications, Performance Chemicals and Performance Materials. The declines occurred primarily during the fourth quarter, resulting from destocking inphotovoltaics, polymer and industrial supply chains, as well as weaker demand for company products supplying consumer electronics and construction.Volume growth in Latin America was driven by Agriculture and Safety & Protection. Sales in developing markets of $11.2 billion improved 29 percent from2010, and the percentage of total company sales in these markets increased to 33 percent from 31 percent in 2010.(Dollars in millions)201220112010OTHER INCOME, NET$498$742$1,1992012 versus 2011 The $244 million decrease was largely attributable to a $228 million reduction of Cozaar®/Hyzaar® income, a decrease of $92 million inequity in earnings of affiliates, and an increase of $69 million in net pre-tax exchange losses, partially offset by a $122 million gain related to the sale of thecompany's interest in an equity method investment.2011 versus 2010 The $457 million decrease was largely attributable to a $201 million reduction of Cozaar®/Hyzaar® income, an increase of $134 millionin net pre-tax exchange losses, the absence of a benefit of $59 million recorded in 2010 related to accrued interest associated with settlements of income taxcontingencies related to prior years, the absence of $41 million in insurance recoveries and a $32 million decrease in net gains on sales of assets.Additional information related to the company's other income, net is included in Note 5 to the Consolidated Financial Statements.(Dollars in millions)201220112010COST OF GOODS SOLD AND OTHER OPERATING CHARGES$25,604$24,874$20,574As a percent of net sales74%74%74%2012 versus 2011 Cost of goods sold and other operating charges (COGS) increased 3 percent to $25.6 billion. COGS as a percentage of net sales was 74percent, unchanged from 2011. Increased charges of $537 million related to Imprelis® and other litigation matters were offset by higher selling prices. See Note16 for additional information related to the Imprelis® matter.2011 versus 2010 COGS of $24.9 billion increased 21 percent. COGS as a percentage of net sales was 74 percent, unchanged from prior year, as sellingprice increases offset inflation in raw material, energy and freight costs, and higher plant operating costs, including capacity expansions. 2011 COGS alsoincluded $175 million of additional costs related to the fair value step-up of inventory acquired from Danisco, $85 million of Danisco transaction related feesand $175 million for charges related to Imprelis® herbicide claims.19Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continued(Dollars in millions)201220112010SELLING, GENERAL AND ADMINISTRATIVE EXPENSES$3,567$3,358$2,912As a percent of net sales10%10%11%2012 versus 2011 The 2012 increase of $209 million was due to increased global commissions and selling and marketing investments, primarily in theAgriculture segment, and a full year of selling expense of acquired companies.2011 versus 2010 The 2011 increase of $446 million was due to the additional selling expense of acquired companies and increased global commissionsand selling and marketing investments, primarily in the Agriculture segment.(Dollars in millions)201220112010RESEARCH AND DEVELOPMENT EXPENSE$2,067$1,910$1,603As a percent of net sales6%6%6%2012 versus 2011 The $157 million increase was primarily attributable to a full year of research and development expense from acquired companies andcontinued growth investments in the Agriculture segment offset by the absence of a $50 million charge for a payment related to a Pioneer licensing agreement in2011.2011 versus 2010 The $307 million increase was primarily attributable to research and development expense from acquired companies and continuedgrowth investment in the Agriculture segment. Both periods include a $50 million charge for payments related to a Pioneer licensing agreement prior to thebusiness receiving regulatory approval in the third quarter 2011.(Dollars in millions)201220112010INTEREST EXPENSE$464$447$590The $17 million increase in 2012 was due primarily to higher average borrowings and lower capitalized interest partially offset by a lower average borrowingrate. The $143 million decrease in 2011 was due primarily to the absence of a $179 million pre-tax charge on the early extinguishment of debt and lowerinterest rates, partially offset by higher average debt resulting from financing for the Danisco acquisition.(Dollars in millions)201220112010EMPLOYEE SEPARATION/ASSET RELATED CHARGES, NET$493$53$(40)The $493 million in charges recorded during 2012 in employee separation / asset related charges, net consisted of $234 million in charges related to the 2012restructuring program, a $16 million net reduction in the estimated costs associated with 2011 and prior years restructuring programs, and $275 million inasset impairment charges, as discussed below.The net $53 million charge recorded during 2011 was primarily related to the 2011 restructuring program, as discussed below, and the $40 million creditrecorded during 2010 was due to a net reduction in the estimated costs for prior years restructuring programs.2012 Restructuring ProgramIn 2012, the company commenced a restructuring plan to increase productivity, enhance competitiveness and accelerate growth. The plan is designed toeliminate corporate costs previously allocated to the Performance Coatings business as well as utilize additional cost-cutting actions to improvecompetitiveness. As a result, pre-tax charges of $234 million were recorded in employee separation / asset related charges, net. The 2012 restructuring programcharges consist of $157 million of employee separation costs, $8 million of other non-personnel charges, and $69 million of asset related charges, whichincludes $30 million of asset impairments and $39 million of asset shut downs. The company expects this plan and all related payments to be substantiallycomplete by December 31, 2013. The actions related to this plan are expected to achieve pre-tax cost savings of approximately $300 million in 2013 increasingto $450 million per year in subsequent years.20Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continued2011 Restructuring ProgramIn 2011, the company initiated a series of actions to achieve the expected cost synergies associated with the Danisco acquisition. As a result, the companyrecorded a $53 million charge in employee separation/asset related charges, net, primarily for employee separation costs in the U.S. and Europe.In the fourth quarter 2012, the company recorded a net reduction of $15 million in the estimated costs associated with the 2011 restructuring program. Thisnet reduction was primarily due to workforce reductions through non-severance programs and lower than estimated individual severance costs. The actionsand payments related to the 2011 restructuring program were substantially complete as of December 31, 2012.Asset ImpairmentsDuring 2012, the company recorded asset impairment charges of $275 million to write-down the carrying value of certain asset groups to fair value. Theseasset impairment charges resulted in a $150 million charge within the Electronics & Communications segment, a $92 million charge within the PerformanceMaterials segment and a $33 million charge within the Performance Chemicals segment.Additional details related to the restructuring programs and asset impairments discussed above can be found in Note 3 to the Consolidated FinancialStatements.Below is a summary of the net impact related to items recorded in employee separation / asset related charges, net: (Dollars in millions)2012 (Charges) andCredits2011 (Charges) andCredits2010 (Charges)and CreditsAgriculture$(11)$—$—Electronics & Communications(159)—8Industrial Biosciences(3)(9)—Nutrition & Health(49)(14)—Performance Chemicals(36)—10Performance Materials(104)(2)16Safety & Protection(58)—5Other11(28)1Corporate expenses(84)——Total (Charges) Credits$(493)$(53)$40(Dollars in millions)201220112010PROVISION FOR INCOME TAXES ON CONTINUING OPERATIONS$622$626$515Effective income tax rate20.0%16.6%15.8%In 2012, the company recorded a tax provision on continuing operations of $622 million, reflecting a marginal decrease from 2011. The increase in the 2012effective tax rate compared to 2011 was primarily due to geographic mix of earnings, in addition to the absence of certain U.S. business tax provisions in 2012(extended retroactively to 2012 in first quarter 2013).In 2011, the company recorded a tax provision on continuing operations of $626 million, reflecting an increase from 2010 largely due to pre-tax earningsgrowth, which was partially offset by the impact associated with the company's policy of hedging the foreign currency-denominated monetary assets andliabilities of its operations.See Note 6 to the Consolidated Financial Statements for additional details related to the provision for income taxes on continuing operations, as well as itemsthat significantly impact the company's effective income tax rate.21Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continued(Dollars in millions)201220112010INCOME FROM CONTINUING OPERATIONS AFTER INCOME TAXES$2,493$3,155$2,745Income from continuing operations after income taxes for 2012 was $2.5 billion compared to $3.2 billion in 2011 and $2.7 billion in 2010. The changesbetween periods were due to the reasons noted above.Corporate OutlookThe company expects 2013 sales and earnings to benefit from modest growth in global gross domestic product and industrial production. The company’smarket position and financial results will continue to be enhanced by market-driven innovation and productivity. Raw material, energy and freight costs areexpected to increase, principally due to higher seed input costs and titanium ore. Currency impact for the full-year 2013 versus 2012 is expected to be flat. Thecompany expects a dynamic market environment, including strong Agriculture demand and significant headwinds related to the cyclical nature of the titaniumdioxide industry affecting the Performance Chemicals segment.Segment ReviewsSegment sales include transfers to another business segment. Products are transferred between segments on a basis intended to reflect, as nearly as practicable,the market value of the products. Segment pre-tax operating income (loss) (PTOI) is defined as income (loss) from continuing operations before income taxesexcluding exchange gains (losses), corporate expenses and interest. All references to prices are on a U.S. dollar (USD) basis, including the impact of currency.A reconciliation of segment sales to consolidated net sales and segment PTOI to income from continuing operations before income taxes for 2012, 2011 and2010 is included in Note 22 to the Consolidated Financial Statements.AGRICULTURE(Dollars in millions)201220112010Segment sales$10,426$9,166$7,845PTOI$1,594$1,527$1,293PTOI margin15%17%16% 20122011Change in segment sales from prior period due to: Price6%6%Volume8%10%Portfolio / Other—%1%Total change14%17%2012 versus 2011 Pioneer seed sales reflect growth primarily in corn and soybean seeds. Volume increases in all regions reflect increased planted area.Global pricing gains reflect continued penetration of new genetics and trait packages, including the Optimum® AcreMax® Family of integrated and reducedrefuge corn hybrids and Optimum® AQUAmaxTM products for improved drought tolerance. Crop Protection sales grew in all regions reflecting volume andprice gains from herbicides, insect control products and fungicides, particularly continued strong demand for Rynaxypyr® insect control products.2012 PTOI increased as strong sales and a $117 million gain on the sale of a business more than offset $575 million of charges related to Imprelis®, higherinput costs in seeds, unfavorable currency and higher investments in commercial and R&D activities to support growth. 2012 PTOI margin decreased due toincreased charges related to Imprelis®. See Note 16 to the Consolidated Financial Statements for more information related to the Imprelis® matter.2011 versus 2010 Pioneer seed sales reflect growth primarily in corn and soybean seeds. Volume increases in all regions reflect increased planted area andmarket position. Pricing gains in all regions reflect the introduction and penetration of new products including Optimum® AcreMax® 1 into the North Americacorn lineup. Crop Protection sales growth reflects both volume and price gains with increases in insect control, weed control and fungicides product sales,particularly continued strong demand for22Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedRynaxypyr® insecticide and continued expansion of picoxystrobin fungicides. Sales grew in all regions, particularly Latin America and Europe.2011 PTOI and PTOI margin increased on continued new product penetration and leverage on volume growth, partially offset by a $175 million charge relatedto Imprelis®. Additionally, aligned with the segment's long-term plan, research and development expense increased 15 percent to support continued growth inbreeding, biotechnology and crop chemistry. 2011 and 2010 PTOI each included a licensing agreement charge of $50 million.Outlook Pioneer anticipates continued strong demand in global corn and soybean markets, as well as pricing gains from new corn hybrids and soybeanvarieties and increased penetration of the Optimum® AcreMax® Family of integrated and reduced refuge corn hybrids and Optimum® AQUAmaxTM productsfor improved drought tolerance. Pioneer anticipates PTOI growth in 2013 reflecting higher sales, partially offset by higher seed input costs resulting fromcommodity price increases and the multi year weather related impact on production yields, as well as continued investment in commercial and R&D activitiesto support growth.In the Crop Protection business, sales and earnings growth in 2013 is expected in all regions, and for all product groups, primarily in insect control productsand fungicides. Sales and PTOI are expected to benefit from continued growth of Rynaxypyr®, broad registrations in new markets for CyazypyrTM insectcontrol products, as well as the launch of picoxystrobin fungicides in the U.S. and continued expansion of penthiopyrad fungicide.ELECTRONICS & COMMUNICATIONS(Dollars in millions)201220112010Segment sales$2,701$3,173$2,764PTOI$135$355$445PTOI margin5%11%16% 20122011Change in segment sales from prior period due to: Price(4)%23 %Volume(11)%(8)%Portfolio / Other— %— %Total change(15)%15 %2012 versus 2011 Sales declined on lower volume in PV materials, partially offset by increased demand for smart phones and tablets. Lower priceprimarily reflects pass-through of lower metals prices.2012 PTOI decreased on lower volume and a $150 million asset impairment charge noted above, partially offset by a $122 million gain related to the sale ofan equity method investment. PTOI margin decreased primarily reflecting lower volume.2011 versus 2010 Sales growth reflects higher selling prices, primarily pass-through of metals prices. Lower sales volume primarily reflects destocking inPV and softness in consumer electronics in the second half 2011, which more than offset strong demand in all market segments in the first half 2011. 2011 PTOI decreased primarily due to lower volume in the second half 2011. PTOI margin decreased primarily reflecting higher metal prices, as well asweaker product mix.Outlook For 2013, sales are expected to increase slightly on higher volumes. PV installations are expected to be essentially flat versus 2012. Sales volumesare anticipated to improve as inventories across the value chain are at reasonable levels entering into 2013, offset in part by lower materials usage in modules.Sales into consumer electronics, driven by smart phones and tablets, are expected to be soft in the first half of the year with stronger demand in second half.Earnings are expected to increase reflecting the impact of higher volume.23Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedINDUSTRIAL BIOSCIENCES(Dollars in millions)201220112010Segment sales$1,180$705$—PTOI$168$(1)$—PTOI margin14%— %—% 20122011Change in segment sales from prior period due to: Price(4)%—%Volume8 %—%Portfolio / Other63 %—%Total change67 %—%2012 versus 2011 Sales were up primarily due to the Danisco enzyme business acquisition. Volume growth reflects strong sales of Sorona® polymer forcarpeting, while lower price relates to unfavorable currency impact.2012 PTOI and PTOI margin increased reflecting benefits of the acquisition and the absence of a $70 million charge recorded in the prior year for the fairvalue step-up of inventories acquired.2011 versus 2010 Sales and PTOI primarily reflects the Danisco acquisition. 2011 PTOI included a $70 million charge for the fair value step-up ofinventories that were acquired as part of the acquisition and a $9 million restructuring charge. PTOI also included $12 million of amortization expenseassociated with the fair value step-up of the acquired intangible assets.Outlook Sales are expected to increase in 2013 as a result of continued strong demand for Sorona® polymer for carpeting and the introduction of newproducts in most enzyme markets. Demand for enzymes for ethanol production will remain soft until producer margins improve. Segment earnings areexpected to increase consistent with volume growth, pricing gains and cost synergies derived from integration.NUTRITION & HEALTH(Dollars in millions)201220112010Segment sales$3,422$2,460$1,240PTOI$299$44$62PTOI margin9%2%5% 20122011Change in segment sales from prior period due to: Price1%5%Volume3%1%Portfolio / Other35%92%Total change39%98%2012 versus 2011 Sales were up primarily due to the Danisco specialty food ingredients business acquisition. Higher volume reflects strong demand forenablers, probiotics and cultures, particularly in North America. Higher local prices more than offset unfavorable currency impact.2012 PTOI and PTOI margin increased reflecting benefits of the acquisition and the absence of a $112 million charge recorded in the prior year for transactionrelated costs and the fair value step-up of inventories acquired, partially offset by increased restructuring charges in 2012 as described above.24Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continued2011 versus 2010 Sales were up primarily due to the Danisco acquisition. For Solae, higher selling prices and volume reflect strong demand for specialtysoy products. 2011 PTOI and PTOI margin decreased as higher sales were more than offset by a $112 million charge for transaction related costs and the fair value step-upof inventories that were acquired and a $14 million restructuring charge. PTOI also included $49 million of amortization expense associated with the fair valuestep-up of the acquired intangible assets.Outlook For 2013, sales are expected to increase driven by strong demand for enablers, probiotics and cultures. Growth is expected in all regions,particularly in Asia Pacific and Latin America, in the areas of nutrition solutions, improved health and food protection. Volume growth, mix enrichment, costsynergies derived from integration and productivity gains, partially offset by raw material increases, are expected to contribute to earnings and PTOI marginimprovement.PERFORMANCE CHEMICALS(Dollars in millions)201220112010Segment sales$7,188$7,794$6,322PTOI$1,586$1,923$1,081PTOI margin22%25%17% 20122011Change in segment sales from prior period due to: Price4 %26 %Volume(12)%(3)%Portfolio / Other— %— %Total change(8)%23 %2012 versus 2011 Lower sales volume primarily reflects softness in titanium dioxide in all regions and weak demand in fluoropolymers. Higher local priceprimarily reflects favorable pricing for titanium dioxide in the first half 2012, which more than offset unfavorable currency impact.2012 PTOI and PTOI margin decreased as higher local prices were more than offset by lower volume, lower plant utilization and a $33 million assetimpairment charge noted above.2011 versus 2010 Sales increased across all regions and market segments. The increase in sales reflects favorable pricing for titanium dioxide andfluoropolymers, as well as pass-through pricing of higher raw material costs for fluorochemicals and industrial chemicals. 2011 PTOI and PTOI margin improved driven by the higher selling prices and fixed cost productivity.Outlook Sales are expected to decrease in 2013 reflecting weaker pricing for titanium dioxide and fluoropolymers, partially offset by strong demand forindustrial chemicals. Segment earnings are also expected to decrease as productivity actions are more than offset by lower titanium dioxide prices. PTOImargins are expected to decline about 7 to 9 percentage points.25Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedPERFORMANCE MATERIALS(Dollars in millions)201220112010Segment sales$6,447$6,815$6,287PTOI$1,013$971$994PTOI margin16%14%16% 20122011Change in segment sales from prior period due to: Price(2)%13 %Volume— %(4)%Portfolio / Other(3)%(1)%Total change(5)%8 %2012 versus 2011 Lower sales reflect a 3 percent reduction from a portfolio change and lower prices due to unfavorable currency impact. Stable packagingmarkets and demand improvement in automotive were offset by continued softness in the industrial and electronics markets.2012 PTOI and PTOI margin increased as lower feedstock costs more than offset a $92 million asset impairment charge noted above, unfavorable currencyimpact and the absence of a $49 million benefit from the gain on the sale of a business recorded in the prior year.2011 versus 2010 Higher selling prices reflect pricing actions which offset higher feedstock costs. Lower sales volume reflect broad-based channeldestocking with softening in consumer and industrial markets in the second half 2011, and production-related supply issues in ethylene-based polymers. 2011 PTOI was essentially flat. 2011 PTOI included a $49 million benefit from the gain on the sale of a business. 2010 PTOI included a combined $58million gain on an asset purchase due to the acquisition and early termination of a supply agreement, a gain on the sale of a business and an insurancerecovery. Lower PTOI margin primarily reflects feedstock costs increasing at a higher rate than selling prices.Outlook 2013 sales are expected to grow due to anticipated increases in global motor vehicle OEM builds, particularly in China. The segment is alsoexpected to benefit from volume growth in the consumer and industrial markets. PTOI is expected to improve due to the impact of higher volume and science-based innovations for products and processes, partially offset by higher feedstock costs.26Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedSAFETY & PROTECTION(Dollars in millions)201220112010Segment sales$3,825$3,934$3,364PTOI$360$500$454PTOI margin9%13%13% 20122011Change in segment sales from prior period due to: Price— %6%Volume(3)%4%Portfolio / Other— %7%Total change(3)%17%2012 versus 2011 Lower U.S. public sector demand and softness in certain industrial markets, including stalled infrastructure projects in China, waspartially offset by higher demand for Sustainable Solutions offerings. Higher local prices were offset by the impact of unfavorable currency.2012 PTOI and PTOI margin decreased primarily due to a $58 million restructuring charge noted above, unfavorable currency and lower volume.2011 versus 2010 Sales growth occurred in all regions. Sales growth primarily reflects the impact of the MECS acquisition and higher selling prices,including a favorable currency impact. Higher volume primarily reflects increased demand for aramid and nonwoven products primarily in the industrialmarkets in the first half 2011, with slower growth rates in the second half 2011.2011 PTOI increased as the impact of the MECS acquisition and a favorable currency impact more than offset higher spending for growth initiatives andhigher raw material costs. The Kevlar® expansion at Cooper River, South Carolina was completed and began commercial supply at the end of 2011.Outlook For 2013, sales for Kevlar®, Nomex® and Tyvek® products are expected to benefit from improving industrial demand, including higherinfrastructure spending in China. Additionally, Kevlar® and Nomex® sales are expected to improve as the year progresses from more consistent spending inthe public sector. Higher demand for Sustainable Solutions offerings are expected, including growth in the areas of process safety management and sustainableoperations. Building Innovations sales are expected to increase due to the continued recovery in the U.S. housing market, new product introductions andcontinued penetration in commercial construction applications. Earnings are expected to improve throughout the year from higher sales, reflecting innovativegrowth through products such as Kevlar® AP fiber, as well as continued productivity actions.PHARMACEUTICALS(Dollars in millions)201220112010Segment sales$—$—$—PTOI$62$289$489Decreases in PTOI reflect the expiration of certain patents related to Cozaar®/Hyzaar®.Outlook Earnings contributions to the company from the collaboration with Merck are expected to decline in 2013 to about $20 million.27Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedLiquidity & Capital Resources December 31,(Dollars in millions)20122011Cash, cash equivalents and marketable securities$4,407$4,019Total debt11,74012,553The company believes its ability to generate cash from operations and access to capital markets will be adequate to meet anticipated cash requirements to fundworking capital, capital spending, dividend payments, debt maturities and other cash needs. The company's liquidity needs can be met through a variety ofsources, including: cash provided by operating activities, cash and cash equivalents, marketable securities, commercial paper, syndicated credit lines,bilateral credit lines, equity and long-term debt markets and asset sales. The company's current strong financial position, liquidity and credit ratings provideexcellent access to the capital markets. In addition, spending and capital productivity actions have been implemented. The company will continue to monitorthe financial markets in order to respond to changing conditions. Depending on these conditions, the proceeds of commercial paper may be invested in cashequivalents or marketable securities.Pursuant to its cash discipline policy, the company seeks first to maintain a strong balance sheet and second, to return excess cash to shareholders unless theopportunity to invest for growth is compelling. Cash, cash equivalents and marketable securities provide primary liquidity to support all short-term debtobligations. A substantial majority of the company's cash, cash equivalents and marketable securities is held by foreign subsidiaries and is considered to beindefinitely reinvested and expected to be utilized to fund local operating activities and capital expenditure requirements. The company believes that it hassufficient sources of domestic liquidity to further support its assumption that undistributed earnings at December 31, 2012 can be considered reinvestedindefinitely. The company has access to approximately $4.3 billion in unused credit lines with several major financial institutions, as additional support tomeet short-term liquidity needs and general corporate purposes, including letters of credit.The company continually reviews its debt portfolio and occasionally may rebalance it to ensure adequate liquidity and an optimum debt maturity schedule. In2011, the company issued $2.0 billion in Senior Notes and $1.0 billion in commercial paper to finance the acquisition of Danisco. Additionally, the companyassumed $0.7 billion in debt as part of the acquisition, which was refinanced through the issuance of commercial paper.The company's credit ratings impact its access to the debt capital market and cost of capital. The company remains committed to a strong financial positionand strong investment-grade rating. The company's long-term and short-term credit ratings are as follows: Long-termShort-termOutlookStandard & Poor'sAA-1StableMoody’s Investors ServiceA2P-1StableFitch RatingsAF1Stable(Dollars in millions)201220112010Cash provided by operating activities$4,849$5,152$4,559Cash provided by operating activities decreased $303 million in 2012 compared to 2011 due mainly to lower earnings and a $500 million contribution to itsprincipal U.S. pension plan, partially offset by less of an increase in operating assets and liabilities.Cash provided by operating activities increased $593 million in 2011 compared to 2010. The increase was driven by higher earnings, lower contributions topension plans and the weaker dollar, which was hedged with forward exchange contracts reflected in investing activities. These increases were partially offsetby changes in operating assets and liabilities, mainly due to higher inventory.28Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continued(Dollars in millions)201220112010Cash used for investing activities$(1,346)$(6,238)$(2,439)Cash used for investing activities decreased $4.9 billion in 2012 compared to 2011. The decrease was due mainly to the absence in 2012 of the company'sDanisco acquisition in 2011.The $3.8 billion increase in 2011 was mainly due to the payment for the Danisco acquisition, higher expenditures for the purchases of property, plant andequipment, and a net increase in payments for forward exchange contract settlements; partially offset by changes in investments in short-term financialinstruments.Purchases of property, plant and equipment totaled $1.8 billion in 2012 and 2011, and $1.5 billion in 2010. The company expects 2013 purchases ofproperty, plant and equipment to be about $1.9 billion, an increase of $0.1 billion over 2012.(Dollars in millions)201220112010Cash (used for) provided by financing activities$(2,697)$403$(1,829)The $3.1 billion increase in cash used for financing activities in 2012 was due mainly to a decrease in borrowings in 2012 versus an increase in 2011, lesscash received from options exercised and the company's increased investment in Solae, LLC in 2012, partially offset by reduced purchases of common stockin 2012 versus 2011.The $2.2 billion change in 2011 was primarily due to an increase in borrowings in 2011 to finance the Danisco acquisition as compared to a decrease inborrowings in 2010.Dividends paid to common and preferred shareholders were $1.6 billion, $1.5 billion, and $1.5 billion in 2012, 2011, and 2010, respectively. Dividends pershare of common stock were $1.70, $1.64, and $1.64 in 2012, 2011, and 2010, respectively. The common dividend declared in the first quarter 2013 wasthe company's 434th consecutive dividend since the company's first dividend in the fourth quarter 1904.During 2012, the company purchased and retired 7.8 million shares at a total cost of $400 million. These purchases completed the 2001 $2 billion sharebuyback plan and began purchases under a $2 billion share buyback plan authorized by the company's Board of Directors in April 2011. Under thecompleted 2001 plan, the company purchased a total of 42.0 million shares. As of December 31, 2012, the company has purchased 5.5 million shares at atotal cost of $284 million under the 2011 plan. There is no required completion date for the purchases under the 2011 plan.In December 2012, the company's Board of Directors authorized a $1 billion share buyback plan, subject to receiving the proceeds from the PerformanceCoatings divestiture. On February 1, 2013, the sale of Performance Coatings was completed. The 2012 share buyback plan is expected to be completed in thefirst half 2013.During 2011 and 2010, the company purchased and retired 13.8 million and 5.4 million shares at a total cost of $672 million and $250 million, respectively,under the 2001 plan.(Dollars in millions)201220112010Cash provided by operating activities$4,849$5,152$4,559Purchases of property, plant and equipment(1,793)(1,843)(1,508)Free cash flow$3,056$3,309$3,051Free cash flow is a measurement not recognized in accordance with GAAP and should not be viewed as an alternative to GAAP measures of performance. Allcompanies do not calculate non-GAAP financial measures in the same manner and, accordingly, the company's free cash flow definition may not be consistentwith the methodologies used by other companies. The company defines free cash flow as cash provided by operating activities less purchases of property,plant and equipment, and therefore indicates operating cash flow available for payment of dividends, other investing activities and other financing activities.Free cash flow is useful to investors and management to evaluate the company's cash flow and financial performance, and is an integral financial measureused in the company's financial planning process.29Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedCritical Accounting EstimatesThe company's significant accounting policies are more fully described in Note 1 to the Consolidated Financial Statements. Management believes that theapplication of these policies on a consistent basis enables the company to provide the users of the financial statements with useful and reliable informationabout the company's operating results and financial condition.The preparation of the Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect thereported amounts, including, but not limited to, receivable and inventory valuations, impairment of tangible and intangible assets, long-term employee benefitobligations, income taxes, restructuring liabilities, environmental matters and litigation. Management's estimates are based on historical experience, facts andcircumstances available at the time and various other assumptions that are believed to be reasonable. The company reviews these matters and reflects changesin estimates as appropriate. Management believes that the following represents some of the more critical judgment areas in the application of the company'saccounting policies which could have a material effect on the company's financial position, liquidity or results of operations.Long-term Employee BenefitsAccounting for employee benefit plans involves numerous assumptions and estimates. Discount rate and expected return on plan assets are two criticalassumptions in measuring the cost and benefit obligation of the company's pension and other long-term employee benefit plans. Management reviews these twokey assumptions annually as of December 31st. These and other assumptions are updated periodically to reflect the actual experience and expectations on aplan specific basis as appropriate. As permitted by GAAP, actual results that differ from the assumptions are accumulated on a plan by plan basis and to theextent that such differences exceed 10 percent of the greater of the plan's benefit obligation or the applicable plan assets, the excess is amortized over the averageremaining service period of active employees.About 76 percent of the company's benefit obligation for pensions and essentially all of the company's other long-term employee benefit obligations areattributable to the benefit plans in the U.S. In the U.S. the discount rate is developed by matching the expected cash flow of the benefit plans to a yield curveconstructed from a portfolio of high quality fixed-income instruments provided by the plan's actuary as of the measurement date. For non-U.S. benefit plans,the company utilizes prevailing long-term high quality corporate bond indices to determine the discount rate, applicable to each country, at the measurementdate.Within the U.S., the company establishes strategic asset allocation percentage targets and appropriate benchmarks for significant asset classes with the aim ofachieving a prudent balance between return and risk. Strategic asset allocations in other countries are selected in accordance with the laws and practices ofthose countries. Where appropriate, asset-liability studies are also taken into consideration. The long-term expected return on plan assets in the U.S. is basedupon historical real returns (net of inflation) for the asset classes covered by the investment policy, expected performance, and projections of inflation over thelong-term period during which benefits are payable to plan participants. Consistent with prior years, the long-term expected return on plan assets in the U.S.reflects the asset allocation of the plan and the effect of the company's active management of the plans' assets.In determining annual expense for the principal U.S. pension plan, the company uses a market-related value of assets rather than its fair value. The market-related value of assets is calculated by averaging market returns over 36 months. Accordingly, there may be a lag in recognition of changes in marketvaluation. As a result, changes in the fair value of assets are not immediately reflected in the company's calculation of net periodic pension cost. The followingtable shows the market-related value and fair value of plan assets for the principal U.S. pension plan:(Dollars in billions)201220112010Market-related value of assets$14.8$13.9$13.9Fair value of plan assets15.113.914.8For plans other than the principal U.S. pension plan, pension expense is typically determined using the fair value of assets.30Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedThe following table highlights the potential impact on the company's pre-tax earnings due to changes in certain key assumptions with respect to the company'spension and other long-term employee benefit plans, based on assets and liabilities at December 31, 2012:Pre-tax Earnings Benefit (Charge)(Dollars in millions)1/2 PercentagePointIncrease1/2 PercentagePointDecreaseDiscount rate$107$(114)Expected rate of return on plan assets92(92)Additional information with respect to pension and other long-term employee benefits expenses, liabilities and assumptions is discussed under "Long-termEmployee Benefits" beginning on page 34 and in Note 18 to the Consolidated Financial Statements.Environmental MattersDuPont accrues for remediation activities when it is probable that a liability has been incurred and a reasonable estimate of the liability can be made. Thecompany has recorded a liability of $436 million as of December 31, 2012; these accrued liabilities exclude claims against third parties and are notdiscounted. As remediation activities vary substantially in duration and cost from site to site, it is difficult to develop precise estimates of future siteremediation costs. The company's estimates are based on a number of factors, including the complexity of the geology, the nature and extent of contamination,the type of remedy, the outcome of discussions with regulatory agencies and other PRPs at multi-party sites and the number of and financial viability of otherPRPs. Therefore, considerable uncertainty exists with respect to environmental remediation costs and, under adverse changes in circumstances, the potentialliability may range up to three times the amount accrued.Legal ContingenciesThe company's results of operations could be affected by significant litigation adverse to the company, including product liability claims, patent infringementand antitrust claims, and claims for third party property damage or personal injury stemming from alleged environmental torts. The company recordsaccruals for legal matters when the information available indicates that it is probable that a liability has been incurred and the amount of the loss can bereasonably estimated. Management makes adjustments to these accruals to reflect the impact and status of negotiations, settlements, rulings, advice of counseland other information and events that may pertain to a particular matter. Predicting the outcome of claims and lawsuits and estimating related costs andexposure involves substantial uncertainties that could cause actual costs to vary materially from estimates. In making determinations of likely outcomes oflitigation matters, management considers many factors. These factors include, but are not limited to, the nature of specific claims including unassertedclaims, the company's experience with similar types of claims, the jurisdiction in which the matter is filed, input from outside legal counsel, the likelihood ofresolving the matter through alternative dispute resolution mechanisms and the matter's current status. Considerable judgment is required in determiningwhether to establish a litigation accrual when an adverse judgment is rendered against the company in a court proceeding. In such situations, the company willnot recognize a loss if, based upon a thorough review of all relevant facts and information, management believes that it is probable that the pending judgmentwill be successfully overturned on appeal. A detailed discussion of significant litigation matters is contained in Note 16 to the Consolidated FinancialStatements.Income TaxesThe breadth of the company's operations and the global complexity of tax regulations require assessments of uncertainties and judgments in estimating taxesthe company will ultimately pay. The final taxes paid are dependent upon many factors, including negotiations with taxing authorities in various jurisdictions,outcomes of tax litigation and resolution of disputes arising from federal, state and international tax audits in the normal course of business. The resolution ofthese uncertainties may result in adjustments to the company's tax assets and tax liabilities. It is reasonably possible that changes to the company's globalunrecognized tax benefits could be significant, however, due to the uncertainty regarding the timing of completion of audits and possible outcomes, a currentestimate of the range of increases or decreases that may occur within the next twelve months cannot be made.Deferred income taxes result from differences between the financial and tax basis of the company's assets and liabilities and are adjusted for changes in taxrates and tax laws when changes are enacted. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefitwill not be realized. Significant judgment is required in evaluating the need for and magnitude of appropriate valuation allowances against deferred tax assets.The realization of these assets is dependent on generating future taxable income, as well as successful implementation of various tax planning strategies. Forexample, changes in facts and circumstances that alter the probability that the company will realize deferred tax assets could result in recording a31Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedvaluation allowance, thereby reducing the deferred tax asset and generating a deferred tax expense in the relevant period. In some situations these changes couldbe material.At December 31, 2012, the company had a deferred tax asset balance of $7.8 billion, net of valuation allowance of $1.9 billion. Realization of these assets isexpected to occur over an extended period of time. As a result, changes in tax laws, assumptions with respect to future taxable income, and tax planningstrategies could result in adjustments to these assets. See Note 6 to the Consolidated Financial Statements for additional details related to the deferred tax assetbalance.Valuation of AssetsThe assets and liabilities of acquired businesses are measured at their estimated fair values at the dates of acquisition. The excess of the purchase price overthe estimated fair value of the net assets acquired, including identified intangibles, is recorded as goodwill. The determination and allocation of fair value to theassets acquired and liabilities assumed is based on various assumptions and valuation methodologies requiring considerable management judgment, includingestimates based on historical information, current market data and future expectations. The principal assumptions utilized in the company's valuationmethodologies include revenue growth rates, operating margin estimates, royalty rates, and discount rates. Although the estimates were deemed reasonable bymanagement based on information available at the dates of acquisition, those estimates are inherently uncertain.Assessment of the potential impairment of property, plant and equipment, goodwill, other intangible assets and investments in affiliates is an integral part ofthe company's normal ongoing review of operations. Testing for potential impairment of these assets is significantly dependent on numerous assumptions andreflects management's best estimates at a particular point in time. The dynamic economic environments in which the company's diversified businesses operate,and key economic and business assumptions with respect to projected selling prices, market growth and inflation rates, can significantly affect the outcome ofimpairment tests. Estimates based on these assumptions may differ significantly from actual results. Changes in factors and assumptions used in assessingpotential impairments can have a significant impact on the existence and magnitude of impairments, as well as the time in which such impairments arerecognized. In addition, the company continually reviews its diverse portfolio of assets to ensure they are achieving their greatest potential and are aligned withthe company's growth strategy. Strategic decisions involving a particular group of assets may trigger an assessment of the recoverability of the related assets.Such an assessment could result in impairment losses. During 2012, the company recorded asset impairments charges of $275 million to write-down thecarrying value of certain asset groups to fair value. See Note 3 to the Consolidated Financial Statements for additional details related to these charges.Based on the results of the company's annual goodwill impairment test in 2012, no impairments exist at this time. The company's methodology for estimatingthe fair value of its reporting units is using the income approach based on the present value of future cash flows. The income approach has been generallysupported by additional market transaction analyses. There can be no assurance that the company's estimates and assumptions regarding forecasted cash flowand revenue and operating income growth rates made for purposes of the annual goodwill impairment test will prove to be accurate predictions of the future.The company believes the current assumptions and estimates utilized are both reasonable and appropriate.32Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedOff-Balance Sheet ArrangementsCertain Guarantee ContractsInformation with respect to the company's guarantees is included in Note 16 to the Consolidated Financial Statements. Historically, the company has not hadto make significant payments to satisfy guarantee obligations; however, the company believes it has the financial resources to satisfy these guarantees.Contractual ObligationsInformation related to the company's significant contractual obligations is summarized in the following table: Payments Due In(Dollars in millions)Total atDecember 31,201220132014 –20152016 –20172018 andbeyondLong-term debt obligations1$11,693$1,252$3,124$1,596$5,721Expected cumulative cash requirements for interest payments through maturity3,2474226995851,541Capital leases12737413Operating leases1,414320473331290Purchase obligations2 Information technology infrastructure & services184120577—Raw material obligations6714291693538Utility obligations23071714147INVISTA-related obligations31,293165328328472Human resource services832855——Other20615234191Total purchase obligations2,667965714430558Other liabilities1,4 Workers' compensation8714381619Asset retirement obligations64121339Environmental remediation4368317660117Legal settlements207544License agreements5551153259139—Other619973331875Total other long-term liabilities1,357331532240254Total contractual obligations7,8$20,405$3,293$5,549$3,186$8,3771. Included in the Consolidated Financial Statements.2. Represents enforceable and legally binding agreements in excess of $1 million to purchase goods or services that specify fixed or minimum quantities; fixed, minimum or variable priceprovisions; and the approximate timing of the agreement.3. Primarily represents raw material supply obligations.4. Pension and other long-term employee benefit obligations have been excluded from the table as they are discussed below within Long-term Employee Benefits.5. Primarily represents remaining expected payments under Pioneer license agreements.6. Primarily represents employee-related benefits other than pensions and other long-term employee benefits.7. Due to uncertainty regarding the completion of tax audits and possible outcomes, the estimate of obligations related to unrecognized tax benefits cannot be made. See Note 6 to theConsolidated Financial Statements for additional detail.8. At December 31, 2012, approximately $140 million of the company's contractual obligations relate to the Performance Coatings business, which primarily represents operating leases.The company expects to meet its contractual obligations through its normal sources of liquidity and believes it has the financial resources to satisfy thesecontractual obligations.33Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedLong-term Employee BenefitsThe company has various obligations to its employees and retirees. The company maintains retirement-related programs in many countries that have a long-term impact on the company's earnings and cash flows. These plans are typically defined benefit pension plans, as well as medical, dental and life insurancebenefits for pensioners and survivors and disability and life insurance protection for employees (other long-term employee benefits). Approximately 76 percentof the company's worldwide benefit obligation for pensions and essentially all of the company's worldwide other long-term employee benefit obligations areattributable to the U.S. benefit plans. Pension coverage for employees of the company's non-U.S. consolidated subsidiaries is provided, to the extent deemedappropriate, through separate plans. The company regularly explores alternative solutions to meet its global pension obligations in the most cost effectivemanner possible as demographics, life expectancy and country-specific pension funding rules change. Where permitted by applicable law, the companyreserves the right to change, modify or discontinue its plans that provide pension, medical, dental, life insurance and disability benefits.The majority of employees hired in the U.S. on or after January 1, 2007 are not eligible to participate in the pension and post-retirement medical, dental and lifeinsurance plans, but receive benefits in the defined contribution plans.Benefits under defined benefit pension plans are based primarily on years of service and employees' pay near retirement. Pension benefits are paid primarilyfrom trust funds established to comply with applicable laws and regulations. Unless required by law, the company does not make contributions that are inexcess of tax deductible limits. The actuarial assumptions and procedures utilized are reviewed periodically by the plans' actuaries to provide reasonableassurance that there will be adequate funds for the payment of benefits. The company made a contribution of $500 million in 2010 to its principal U.S.pension plan and no contributions were made in 2011. In January 2012, the company contributed $500 million to its principal U.S. pension plan andanticipates no contributions will be made in 2013. The company expects to make contributions to its principal U.S. pension plan beyond 2013; however, theamount of any contributions is heavily dependent on the future economic environment and investment returns on pension trust assets. U.S. pension benefitsthat exceed federal limitations are covered by separate unfunded plans and these benefits are paid to pensioners and survivors from operating cash flows.Funding for each pension plan is governed by the rules of the sovereign country in which it operates. Thus, there is not necessarily a direct correlation betweenpension funding and pension expense. In general, however, improvements in plans funded status tends to moderate subsequent funding needs. The companycontributed $848 million to its pension plans in 2012 and anticipates that it will make approximately $340 million in contributions in 2013 to pension plansother than the principal U.S. pension plan.The company's other long-term employee benefits are unfunded and the cost of the approved claims is paid from operating cash flows. Pre-tax cashrequirements to cover actual net claims costs and related administrative expenses were $261 million, $312 million and $321 million for 2012, 2011 and2010, respectively. This amount is expected to be about $260 million in 2013. Changes in cash requirements reflect the net impact of higher per capita healthcare costs, demographic changes, plan amendments and changes in participant premiums, co-pays and deductibles.During the third quarter 2012, the company amended its U.S. parent company retiree medical and dental plans for Medicare-eligible pensioners and survivors.Beginning in 2013, the company is replacing the coverage for Medicare-eligible plan participants in the company sponsored plans with a new company-fundedHealth Reimbursement Arrangement (HRA). Medicare-eligible plan participants will enroll in individual health plans in the open market and the company willreimburse their health care expenses with an HRA based on the provisions of the amended plans. As a result of this change, the company's other long-termemployee benefit expense was reduced by approximately $46 million in 2012. For 2013, the plan amendment is expected to result in a reduction in other long-term employee benefit expense by about $120 million. Additional information related to these changes in the plans noted above is included in Note 18 to theConsolidated Financial Statements.34Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedThe company's income can be significantly affected by pension and defined contribution benefits as well as other long-term employee benefits. The followingtable summarizes the extent to which the company's income over each of the last 3 years was affected by pre-tax charges related to long-term employee benefits:(Dollars in millions)201220112010Long-term employee benefit plan charges 1$1,321$1,134$1,0301. The long-term employee benefit plan charges relating to discontinued operations was $74, $72 and $71 for 2012, 2011 and 2010, respectively.The above charges for pension and other long-term employee benefits are determined as of the beginning of each year. The increase in long-term employeebenefit expense in 2012 is primarily related to the decrease in discount rates and lower return on plan assets, partially offset by plan amendments to thecompany's U.S. parent company retiree medical and dental plans. The increase in long-term employee benefit expense in 2011 is primarily related to thedecrease in discount rates. See "Long-term Employee Benefits" under the Critical Accounting Estimates section beginning on page 30 of this report foradditional information on determining annual expense for the principal U.S. pension plan.The company's key assumptions used in calculating its pension and other long-term employee benefits are the expected return on plan assets, the rate ofcompensation increases and the discount rate (see Note 18 to the Consolidated Financial Statements). For 2013, long-term employee benefits expense fromcontinuing operations is expected to decrease by about $30 million.Environmental MattersThe company operates global manufacturing, product handling and distribution facilities that are subject to a broad array of environmental laws andregulations. Such rules are subject to change by the implementing governmental agency, and the company monitors these changes closely. Company policyrequires that all operations fully meet or exceed legal and regulatory requirements. In addition, the company implements voluntary programs to reduce airemissions, minimize the generation of hazardous waste, decrease the volume of water use and discharges, increase the efficiency of energy use and reduce thegeneration of persistent, bioaccumulative and toxic materials. Management has noted a global upward trend in the amount and complexity of proposedchemicals regulation. The costs to comply with complex environmental laws and regulations, as well as internal voluntary programs and goals, are significantand will continue to be significant for the foreseeable future. Pre-tax environmental expenses charged to current operations are summarized below:(Dollars in millions)201220112010Environmental operating costs$595$562$521Increase in remediation accrual1109293 $705$654$614About 75 percent of total pre-tax environmental expenses charged to current operations in 2012 resulted from operations in the U.S. The increases in total pre-tax environmental expenses charged to operations were due primarily to increased environmental research activities and acquired businesses. Based on existingfacts and circumstances, management does not believe that year over year changes, if any, in environmental expenses charged to current operations will have amaterial impact on the company's financial position, liquidity or results of operations.Environmental Operating CostsAs a result of its operations, the company incurs costs for pollution abatement activities including waste collection and disposal, installation and maintenanceof air pollution controls and wastewater treatment, emissions testing and monitoring, and obtaining permits. The company also incurs costs related toenvironmental related research and development activities including environmental field and treatment studies as well as toxicity and degradation testing toevaluate the environmental impact of products and raw materials.35Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedRemediation AccrualChanges in the remediation accrual balance are summarized below:(Dollars in millions) Balance at December 31, 2010$407Remediation payments(83)Increase in remediation accrual92Balance at December 31, 2011$416Remediation payments(90)Increase in remediation accrual110Balance at December 31, 2012$436Annual expenditures are expected to continue to increase in the near future; however, they are not expected to vary significantly from the range of suchexpenditures experienced in the past few years. Longer term, expenditures are subject to considerable uncertainty and may fluctuate significantly.As of December 31, 2012, the company has been notified of potential liability under the Comprehensive Environmental Response, Compensation andLiability Act (CERCLA or Superfund) or similar state laws at about 415 sites around the U.S., with active remediation under way at approximately 160 ofthese sites. In addition, the company has resolved its liability at approximately 175 sites, either by completing remedial actions with other PRPs or byparticipating in "de minimis buyouts" with other PRPs whose waste, like the company's, represented only a small fraction of the total waste present at a site.The company received notice of potential liability at five new sites during 2012 compared with six and ten similar notices in 2011 and 2010, respectively.Considerable uncertainty exists with respect to environmental remediation costs, and, under adverse changes in circumstances, potential liability may rangeup to three times the amount accrued as of December 31, 2012. However, based on existing facts and circumstances, management does not believe that anyloss, in excess of amounts accrued, related to remediation activities at any individual site will have a material impact on the financial position, liquidity orresults of operations of the company.Environmental Capital ExpendituresIn 2012, the company spent approximately $65 million on environmental capital projects either required by law or necessary to meet the company's internalenvironmental goals. The company currently estimates expenditures for environmental-related capital projects to be approximately $85 million in 2013. In theU.S., additional capital expenditures are expected to be required over the next decade for treatment, storage and disposal facilities for solid and hazardous wasteand for compliance with the CAA. Until all CAA regulatory requirements are established and known, considerable uncertainty will remain regarding estimatesfor future capital expenditures. However, management does not believe that the costs to comply with these requirements will have a material impact on thefinancial position or liquidity of the company.Climate ChangeThe company believes that climate change is an important global issue that presents risks and opportunities. Expanding upon significant global greenhousegas (GHG) emissions and other environmental footprint reductions made in the period 1990-2004, the company reduced its environmental footprint achievingin 2011 year-over-year reductions of eight percent in GHG emissions and nine percent in water consumption. In addition, the company achieved a year-over-year reduction of 2.4 percent in 2011 in energy use from non-renewable resources. The company continuously evaluates opportunities for existing and newproduct and service offerings in light of the anticipated demands of a low-carbon economy. About $1.9 billion of the company's 2012 revenue was generatedfrom sales of products that help direct and downstream customers GHG emissions.The company is actively engaged in the effort to develop constructive public policies to reduce GHG emissions and encourage lower carbon forms of energy.Legislative efforts to control or limit GHG emissions could affect the company's energy source and supply choices as well as increase the cost of energy andraw materials derived from fossil fuels. Such efforts are also anticipated to provide the business community with greater certainty for the regulatory future,help guide investment decisions, and drive growth in demand for low-carbon and energy-efficient products, technologies, and services.36Part IIITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, continuedAt the national and regional level, there are existing efforts to address climate change. Several of the company's facilities in the European Union (EU) areregulated under the EU Emissions Trading Scheme. In other countries, including the U.S., policy debate continues. The current unsettled policy environmentin the U.S. adds an element of uncertainty to business decisions particularly those relating to long-term capital investments. If in the absence of federallegislation, states were to implement programs mandating GHG emissions reductions, the company, its suppliers and customers could be competitivelydisadvantaged by the added administrative costs of complying with a variety of state-specific requirements.In 2010, EPA launched a phased-in scheme to regulate GHG emissions first from large stationary sources under CAA permitting requirements administered bystate and local authorities. As a result, large capital investments may be required to install Best Available Control Technology on major new or modifiedsources of GHG emissions. This type of GHG emissions regulation by EPA, in the absence of or in addition to federal legislation, could result in more costly,less efficient facility-by-facility controls versus a federal program that incorporates policies that provide an economic balance that does not severely distortmarkets. Differences in regional or national legislation could present challenges in a global marketplace highlighting the need for coordinated global policyaction.RegistrationThe European Union's regulatory framework concerning the Registration, Evaluation and Authorization of Chemicals (REACH) entered into force in 2007 andrequires manufacturers and importers to gather and register information on the properties of their substances that meet certain volume or toxicological criteria.The company has successfully integrated REACH registration requirements into its safety, health & environment processes and timely met all suchrequirements to date. REACH also contains a mechanism for the progressive substitution of the most dangerous chemicals when suitable alternatives havebeen identified. Depending on which chemicals are identified, the requirement to use safer alternatives could necessitate changes in production processes.PFOAThe Performance Chemicals segment uses a form of PFOA (collectively, perfluorooctanoic acid and its salts, including the ammonium salt) as a processingaid to manufacture some fluoropolymer resins. The Performance Materials segment uses PFOA in the manufacture of certain raw materials forperfluoroelastomer parts (and some fluoroelastomers). In the fall of 2002, DuPont began producing rather than purchasing PFOA to support thesemanufacturing processes. PFOA is not used in the manufacture of fluorotelomers; however, it is an unintended by-product present at trace levels in somefluorotelomer-based products. PFOA is bio-persistent and has been detected at very low levels in the blood of the general population. As a result, EPA initiated a process to enhance itsunderstanding of the sources of PFOA in the environment and the pathways through which human exposure to PFOA is occurring. Although EPA has statedthat there remains considerable scientific uncertainty regarding potential risks associated with PFOA, it also stated that it does not believe that there is anyreason for consumers to stop using any products because of concerns about PFOA. DuPont respects EPA's position raising questions about exposure routes and the potential toxicity of PFOA. DuPont and other companies continue research,emission reduction and product stewardship activities to help address EPA's questions. In January 2006, DuPont pledged its commitment to EPA's 2010/15PFOA Stewardship Program. The EPA program asks participants (1) to commit to achieve, no later than 2010, a 95 percent reduction in both facilityemissions and product content levels of PFOA, PFOA precursors and related higher homologue chemicals and (2) to commit to working toward the eliminationof PFOA, PFOA precursors and related higher homologue chemicals from emissions and products by no later than 2015. DuPont has exceeded the EPA's 2010objective. In February 2007, DuPont announced its commitment to no longer make, use or buy PFOA by 2015, or sooner if possible. To achieve this goal,DuPont developed PFOA replacement technology and is converting customers to fluoropolymer resins and dispersions manufactured using the replacementtechnology. DuPont has been introducing its next generation fluorotelomers products and converting customers to their use. For additional information regarding PFOA matters, see Note 16 to the Consolidated Financial Statements.37Part IIITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKDerivatives and Other Hedging InstrumentsIn the ordinary course of business, the company enters into contractual arrangements (derivatives) to hedge its exposure to foreign currency, interest rate andcommodity price risks under established procedures and controls. For additional information on these derivatives and related exposures, see Note 20 to theConsolidated Financial Statements.The following table summarizes the impacts of the company's foreign currency hedging program on the company's results of operations for the years endedDecember 31, 2012, 2011, and 2010, and includes the company's pro rata share of its equity affiliates' exchange gains and losses and corresponding gainsand losses on foreign currency exchange contracts:(Dollars in millions)201220112010Pre-tax exchange loss$(215)$(146)$(11)Tax benefit (expense)7381(69)After-tax exchange loss$(142)$(65)$(80)In addition to the contracts disclosed in Note 20 to the Consolidated Financial Statements, from time to time, the company will enter into foreign currencyexchange contracts to establish with certainty the USD amount of future firm commitments denominated in a foreign currency. Decisions regarding whether ornot to hedge a given commitment are made on a case-by-case basis, taking into consideration the amount and duration of the exposure, market volatility andeconomic trends. Foreign currency exchange contracts are also used, from time to time, to manage near-term foreign currency cash requirements.Sensitivity AnalysisThe following table illustrates the fair values of outstanding derivative contracts at December 31, 2012 and 2011, and the effect on fair values of ahypothetical adverse change in the market prices or rates that existed at December 31, 2012 and 2011. The sensitivity for interest rate swaps is based on a onepercent change in the market interest rate. Foreign currency and commodity contracts sensitivities are based on a 10 percent change in market rates. Fair ValueAsset/(Liability)Fair ValueSensitivity(Dollars in millions)2012201120122011Interest rate swaps$55$66$(29)$(40)Foreign currency contracts9154(659)(541)Commodity contracts(1)(3)(3)(103)Since the company's risk management programs are highly effective, the potential loss in value for each risk management portfolio described above would belargely offset by changes in the value of the underlying exposure.Concentration of Credit RiskThe company maintains cash and cash equivalents, marketable securities, derivatives and certain other financial instruments with various financialinstitutions. These financial institutions are generally highly rated and geographically dispersed and the company has a policy to limit the dollar amount ofcredit exposure with any one institution.As part of the company's financial risk management processes, it continuously evaluates the relative credit standing of all of the financial institutions thatservice DuPont and monitors actual exposures versus established limits. The company has not sustained credit losses from instruments held at financialinstitutions.The company's sales are not materially dependent on any single customer. As of December 31, 2012, no one individual customer balance represented morethan 5 percent of the company's total outstanding receivables balance. Credit risk associated with its receivables balance is representative of the geographic,industry and customer diversity associated with the company's global businesses.The company also maintains strong credit controls in evaluating and granting customer credit. As a result, it may require that customers provide some type offinancial guarantee in certain circumstances. Length of terms for customer credit varies by industry and region.38Part IIITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATAThe financial statements and supplementary data required by this Item are included herein, commencing on page F-1 of this report.ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURENone.ITEM 9A. CONTROLS AND PROCEDURESThe company maintains a system of disclosure controls and procedures to give reasonable assurance that information required to be disclosed in thecompany's reports filed or submitted under the Securities Exchange Act of 1934 (Exchange Act) is recorded, processed, summarized and reported within thetime periods specified in the rules and forms of the SEC. These controls and procedures also give reasonable assurance that information required to bedisclosed in such reports is accumulated and communicated to management to allow timely decisions regarding required disclosures.As of December 31, 2012, the company's Chief Executive Officer (CEO) and Chief Financial Officer (CFO), together with management, conducted anevaluation of the effectiveness of the company's disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) of the Exchange Act. Based onthat evaluation, the CEO and CFO concluded that these disclosure controls and procedures are effective.There has been no change in the company's internal control over financial reporting that occurred during the fourth quarter of 2012 that has materiallyaffected, or is reasonably likely to materially affect, the company's internal control over financial reporting. The company has completed its evaluation of itsinternal controls and has concluded that the company's system of internal controls over financial reporting was effective as of December 31, 2012 (see page F-2).ITEM 9B. OTHER INFORMATIONNone.39Part IIIITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCEInformation with respect to this Item is incorporated herein by reference to the Proxy. Information related to directors is included within the section entitled,"Election of Directors." The company has not made any material changes to the procedures by which security holders may recommend nominees to its Boardof Directors since these procedures were communicated in the company's 2012 Proxy Statement for the Annual Meeting of Stockholders held on April 25,2012. Information related to the Audit Committee is incorporated herein by reference to the Proxy and is included within the sections entitled "Committees of theBoard" and "Committee Membership." Information regarding executive officers is contained in the Proxy section entitled "Section 16(a) Beneficial OwnershipReporting Compliance" and as set forth below.The company has adopted a Code of Ethics for its CEO, CFO, and Controller that may be accessed from the company's website at www.dupont.com byclicking on "Investors" and then "Corporate Governance". Any amendments to, or waiver from, any provision of the code will be posted on the company'swebsite at the above address.Executive Officers of the RegistrantThe following is a list, as of February 6, 2013, of the company's Executive Officers: AgeExecutiveOfficerSinceChair of the Board of Directors and Chief Executive Officer: Ellen J. Kullman572006Other Executive Officers: James C. Borel572004Executive Vice President Benito Cachinero-Sánchez542011Senior Vice President - Human Resources Thomas M. Connelly, Jr.602000Executive Vice President and Chief Innovation Officer Nicholas C. Fanandakis562009Executive Vice President and Chief Financial Officer Thomas L. Sager622008Senior Vice President and General Counsel Mark P. Vergnano552009Executive Vice President The company's Executive Officers are elected or appointed for the ensuing year or for an indefinite term and until their successors are elected or appointed.Ellen J. Kullman joined DuPont in 1988 as marketing manager and progressed through various roles as global business director and was named VicePresident and General Manager of White Pigment & Mineral Products in 1995. In 2000, Mrs. Kullman was named Group Vice President and GeneralManager of several businesses and new business development. She became Group Vice President-DuPont Safety & Protection in 2002. In June 2006,Mrs. Kullman was named Executive Vice President and assumed leadership of Marketing & Sales along with Safety and Sustainability. She was appointedPresident on October 1, 2008 and became Chief Executive Officer on January 1, 2009. On December 31, 2009, she became Chair of the Board of Directors.James C. Borel joined DuPont in 1978, and held a variety of product and sales management positions for Agricultural Products. In 1993, he transferred toTokyo, Japan with Agricultural Products as regional manager, North Asia and was appointed regional director, Asia Pacific in 1994. In 1997, he wasappointed regional director, North America and was appointed Vice President and General Manager-DuPont Crop Protection later that year. In January 2004, hewas named Senior Vice President-DuPont Global Human Resources. He became Group Vice President in 2008 and was named Executive Vice President withresponsibility for DuPont Crop Protection and Pioneer in October 2009. In 2011, he assumed responsibility for DuPont Nutrition & Health.40Part IIIITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE, continuedBenito Cachinero-Sánchez joined DuPont in April 2011 as Senior Vice President - Human Resources. Prior to joining DuPont, he was Corporate VicePresident of Human Resources at Automatic Data Processing (ADP). Prior to ADP, he was Vice President, Human Resources for the Medical Devices &Diagnostics Group of Johnson & Johnson.Thomas M. Connelly, Jr. joined DuPont in 1977 as a research engineer. Since then, Mr. Connelly has served in various research and plant technicalleadership roles, as well as product management and business director roles. Mr. Connelly served as Vice President and General Manager-DuPontFluoroproducts from 1999 until September 2000, when he was named Senior Vice President and Chief Science and Technology Officer. In June 2006,Mr. Connelly was named Executive Vice President and Chief Innovation Officer. In October 2009, responsibility for DuPont Performance Polymers,Packaging & Industrial Polymers as well as integrated operations was added. In 2011, he assumed responsibility for DuPont Industrial Biosciences andPerformance Coatings.Nicholas C. Fanandakis joined DuPont in 1979 as an accounting and business analyst. Since then, Mr. Fanandakis served in a variety of plant, marketing,and product management and business director roles. Mr. Fanandakis served as Vice President and General Manager—DuPont Chemical Solutions Enterprisefrom 2003 until February 2007 when he was named Vice President—Corporate Plans. In January 2008, Mr. Fanandakis was named Group Vice President—DuPont Applied BioSciences. In November 2009, he was named Senior Vice President and Chief Financial Officer. In August 2010, he was namedExecutive Vice President and Chief Financial Officer.Thomas L. Sager joined DuPont in 1976 as an attorney in the labor and security group. In 1998, he was named Chief Litigation Counsel and assumedoversight responsibility for all company litigation matters. He was named Vice President and Assistant General Counsel in 1999. In July 2008, he wasappointed Senior Vice President and General Counsel.Mark P. Vergnano joined DuPont in 1980 as a process engineer. He has had several assignments in manufacturing, technology, marketing, sales andbusiness strategy. He has held assignments in various DuPont locations including Geneva, Switzerland. In February 2003 he was named Vice President andGeneral Manager—Nonwovens and Vice President and General Manager—Surfaces and Building Innovations in October 2005. In June 2006, he was namedGroup Vice President of DuPont Safety & Protection. In October 2009, Mr. Vergnano was appointed Executive Vice President with responsibility for DuPontProtection Technologies, Building Innovations, Sustainable Solutions, Chemicals & Fluoroproducts, Titanium Technologies and Electronics &Communications. He also leads the company's sustainability, safety, communications, and sales and marketing functions.ITEM 11. EXECUTIVE COMPENSATIONInformation with respect to this Item is incorporated herein by reference to the Proxy and is included in the sections "Compensation Discussion and Analysis,""2012 Summary Compensation Table," "2012 Grants of Plan-Based Awards," "Outstanding Equity Awards," "2012 Option Exercises and Stock Vested,""Pension Benefits," "Nonqualified Deferred Compensation," "Potential Payments Upon Termination or Change in Control," and "Directors' Compensation."Information related to the Compensation Committee is included within the sections entitled "Compensation Committee Interlocks and Insider Participation" and"Compensation Committee Report."41Part IIIITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERMATTERSInformation with respect to Beneficial Owners is incorporated herein by reference to the Proxy and is included in the section entitled "Ownership of CompanyStock."Securities authorized for issuance under equity compensation plans as of December 31, 2012(Shares in thousands, except per share)Plan CategoryNumber of Securities tobe Issued Upon Exerciseof Outstanding Options,Warrants and Rights Weighted-AverageExercise Price ofOutstanding Options,Warrants and Rights2Number of SecuritiesRemaining Availablefor Future IssuanceUnder EquityCompensation Plans3 Equity compensation plans approved by security holders38,0891 $39.7059,953 Equity compensation plans not approved by security holders874 $37.39—5 Total38,176 $39.7059,953 1. Includes stock-settled time-vested and performance-based restricted stock units granted and stock units deferred under the company's Equity and Incentive Plan, Stock PerformancePlan, Variable Compensation Plan and the Stock Accumulation and Deferred Compensation Plan for Directors. Performance-based restricted stock units reflect the maximum numberof shares to be awarded at the conclusion of the performance cycle (200 percent of the original grant). The actual award payouts can range from zero to 200 percent of the originalgrant.2. Represents the weighted-average exercise price of the outstanding stock options only; the outstanding stock-settled time-vested and performance-based restricted stock units anddeferred stock units are not included in this calculation.3. Reflects shares available pursuant to the issuance of stock options, restricted stock, restricted stock units or other stock-based awards under the amended Equity and IncentivePlan approved by the shareholders in April 2011 (see Note 19 to the company's Consolidated Financial Statements). The maximum number of shares of stock reserved for the grant orsettlement of awards under the Equity and Incentive Plan (Share Limit) shall be 110,000 and shall be subject to adjustment as provided therein; provided that each share in excessof 30,000 issued under the Equity and Incentive Plan pursuant to any award settled in stock, other than a stock option or stock appreciation right, shall be counted against theforegoing Share Limit as four and one-half shares for every one share actually issued in connection with such award. (For example, if 32,000 shares of restricted stock are grantedunder the Equity and Incentive Plan, 39,000 shall be charged against the Share Limit in connection with that award.)4. Includes 16 deferred stock units resulting from base salary and short-term incentive (STIP) deferrals under the Management Deferred Compensation Plan (MDCP). Under theMDCP, a select group of management or highly compensated employees can elect to defer the receipt of their base salary, STIP or Long Term Incentive (LTI) award. LTI deferrals areincluded in footnote 1 to the above chart. The company does not match deferrals under the MDCP. There are seven core investment options under the MDCP for base salary andSTIP deferrals, including deferred stock units with dividend equivalents credited as additional stock units. In general, deferred stock units are distributed in the form of DuPontcommon stock and may be made in the form of lump sum at a specified future date prior to retirement or a lump sum or annual installments after separation from service. Shareholderapproval of the MDCP was not required under the rules of the New York Stock Exchange. This column also includes 71 options from the conversion of DuPont Canada options toDuPont options in connection with the company's acquisition of the minority interest in DuPont Canada.5. There is no limit on the number of shares that can be issued under the MDCP and no further shares are available for issuance under the other equity compensation arrangementsdescribed in footnote 4 to the above chart.ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCEInformation with respect to the company's policy and procedures for the review, approval or ratification of transactions with related persons is incorporated byreference herein to the Proxy and is included in the section entitled "Review and Approval of Transactions with Related Persons." Information with respect todirector independence is incorporated by reference herein to the Proxy and is included in the sections entitled "DuPont Board of Directors—CorporateGovernance Guidelines," "Guidelines for Determining the Independence of DuPont Directors," "Committees of the Board," "Committee Membership" and"Election of Directors".ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICESInformation with respect to this Item is incorporated herein by reference to the Proxy and is included in the sections entitled "Ratification of IndependentRegistered Public Accounting Firm."42Part IVITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES(a)Financial Statements, Financial Statement Schedules and Exhibits:1.Financial Statements (See the Index to the Consolidated Financial Statements on page F-1 of this report).2.Financial Statement SchedulesSchedule II—Valuation and Qualifying Accounts(Dollars in millions)Year Ended December 31,201220112010Accounts Receivable—Allowance for Doubtful Receivables Balance at beginning of period$292$326$322Additions charged to cost and expenses337375Deductions from reserves(64)(107)(71)Amounts related to the Performance Coatings business(18)——Balance at end of period$243$292$326Deferred Tax Assets—Valuation Allowance Balance at beginning of period$1,971$1,666$1,759Net (benefits) charges to income tax expense(77)73(19)Additions charged to other comprehensive income (loss)10236—Currency translation10(4)(74)Balance at end of period$1,914$1,971$1,666Financial Statement Schedules listed under SEC rules but not included in this report are omitted because they are not applicable or the required information isshown in the Consolidated Financial Statements or notes thereto incorporated by reference.43Part IVITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES, continued3.ExhibitsThe following list of exhibits includes both exhibits submitted with this Form 10-K as filed with the SEC and those incorporated by reference to other filings:ExhibitNumberDescription 3.1Company's Restated Certificate of Incorporation. 3.2Company’s Bylaws, as last amended effective November 1, 2009 (incorporated by reference to Exhibit 3.2 to the company’s AnnualReport on Form 10-K for the year ended December 31, 2009). 4The company agrees to provide the Commission, on request, copies of instruments defining the rights of holders of long-term debt ofthe company and its subsidiaries. 10.1*The DuPont Stock Accumulation and Deferred Compensation Plan for Directors, as last amended effective January 1, 2009(incorporated by reference to Exhibit 10.1 to the company’s Annual Report on Form 10-K for the year ended December 31, 2008). 10.2*Company’s Supplemental Retirement Income Plan, as last amended effective June 4, 1996 (incorporated by reference to Exhibit 10.2 tothe company's Annual Report on Form 10-K for the year ended December 31, 2011). 10.3*Company’s Pension Restoration Plan, as restated effective July 17, 2006 (incorporated by reference to Exhibit 10.3 to the company’sQuarterly Report on Form 10-Q for the period ended June 30, 2011). 10.4*Company’s Rules for Lump Sum Payments, as last amended effective December 20, 2007 (incorporated by reference to Exhibit 10.4 tothe company’s Quarterly Report on Form 10-Q for the period ended June 30, 2011). 10.5*Company’s Stock Performance Plan, as last amended effective January 25, 2007 (incorporated by reference to Exhibit 10.5 to thecompany's Annual Report on Form 10-K for the year ended December 31, 2011). 10.6*Company’s Equity and Incentive Plan as amended and restated effective March 2, 2011 and approved by the company’s shareholderson April 27, 2011 (incorporated by reference to pages B1-B15 of the company’s Annual Meeting Proxy Statement dated March 18,2011). 10.7*Form of Award Terms under the company’s Equity and Incentive Plan (incorporated by reference to Exhibit 10.8 to the company’sQuarterly Report on Form 10-Q for the period ended March 31, 2009). 10.8*Company’s Retirement Savings Restoration Plan, as last amended effective January 1, 2013. 10.9*Company’s Retirement Income Plan for Directors, as last amended January 2011 (incorporated by reference to Exhibit 10.9 to thecompany's Quarterly Report on Form 10-Q for the period ended March 31, 2012). 10.10* Company's Management Deferred Compensation Plan, adopted on May 2, 2008, as last amended May 12, 2010 (incorporated byreference to Exhibit 10.11 to the company's Quarterly Report on Form 10-Q for the period ended June 30, 2010). 10.11* Supplemental Deferral Terms for Deferred Long Term Incentive Awards and Deferred Variable Compensation Awards (incorporated byreference to Exhibit 10.15 to the company’s Annual Report on Form 10-K for the year ended December 31, 2008). 10.12* Purchase Agreement dated as of August 30 2012, by and between E. I. du Pont de Nemours and Company and Flash Bermuda Co. Ltd.(incorporated by reference to Exhibit 2.1 to the company's Current Report on Form 8-K filed on September 4, 2012)(the "PurchaseAgreement"). The company agrees to furnish supplementally a copy of any omitted schedules to the Commission upon request. 10.13* Amendment to Purchase Agreement, dated as of January 31, 2013, by and between E. I. du Pont de Nemours and Company and FlashBermuda Co. Ltd. 12 Computation of Ratio of Earnings to Fixed Charges. 21Subsidiaries of the Registrant. 23 Consent of Independent Registered Public Accounting Firm.44Part IVITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES, continuedExhibitNumberDescription 31.1Rule 13a-14(a)/15d-14(a) Certification of the company’s Principal Executive Officer. 31.2Rule 13a-14(a)/15d-14(a) Certification of the company’s Principal Financial Officer. 32.1Section 1350 Certification of the company’s Principal Executive Officer. The information contained in this Exhibit shall not be deemedfiled with the Securities and Exchange Commission nor incorporated by reference in any registration statement filed by the registrantunder the Securities Act of 1933, as amended. 32.2Section 1350 Certification of the company’s Principal Financial Officer. The information contained in this Exhibit shall not be deemedfiled with the Securities and Exchange Commission nor incorporated by reference in any registration statement filed by the registrantunder the Securities Act of 1933, as amended. 95 Mine Safety Disclosures. 101.INSXBRL Instance Document 101.SCHXBRL Taxonomy Extension Schema Document 101.CALXBRL Taxonomy Extension Calculation Linkbase Document 101.DEFXBRL Taxonomy Extension Definition Linkbase Document 101.LABXBRL Taxonomy Extension Label Linkbase Document 101.PREXBRL Taxonomy Extension Presentation Linkbase Document*Management contract or compensatory plan or arrangement required to be filed as an exhibit to this Form 10-K.45SignaturesPursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on itsbehalf by the undersigned, thereunto duly authorized.February 6, 2013 E. I. DU PONT DE NEMOURS AND COMPANY By:/s/ Nicholas C. Fanandakis Nicholas C. FanandakisExecutive Vice President and Chief Financial Officer(Principal Financial and Accounting Officer)_____________________________________________Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of theregistrant in the capacities and on the dates indicated:Signature Title(s) Date /s/ E.J. Kullman Chair of the Board of Directors andChief Executive Officer and Director(Principal Executive Officer) February 6, 2013E. J. Kullman /s/ L. Andreotti Director February 6, 2013L. Andreotti /s/ R.H. Brown Director February 6, 2013R. H. Brown /s/ R.A. Brown Director February 6, 2013R. A. Brown /s/ B.P. Collomb Director February 6, 2013B. P. Collomb /s/ C.J. Crawford Director February 6, 2013C. J. Crawford /s/ A.M. Cutler Director February 6, 2013A. M. Cutler /s/ E.I. du Pont, II Director February 6, 2013E. I. du Pont, II /s/ M.A. Hewson Director February 6, 2013M. A. Hewson /s/ L.D. Juliber Director February 6, 2013L. D. Juliber /s/ L.M. Thomas Director February 6, 2013L. M. Thomas 46 E.I. du Pont de Nemours and CompanyIndex to the Consolidated Financial Statements Page(s)Consolidated Financial Statements: Management's Reports on Responsibility for Financial Statements and Internal Control over Financial ReportingF-2Report of Independent Registered Public Accounting FirmF-3Consolidated Income Statements for the years ended December 31, 2012, 2011 and 2010 F-4Consolidated Statements of Comprehensive Income for the years ended December 31, 2012, 2011 and 2010F-5Consolidated Balance Sheets as of December 31, 2012 and December 31, 2011F-6Consolidated Statements of Equity for the years ended December 31, 2012, 2011 and 2010F-7Consolidated Statements of Cash Flows for the years ended December 31, 2012, 2011 and 2010F-8Notes to the Consolidated Financial StatementsF-9F-1 Management's Reports on Responsibility for Financial Statements andInternal Control over Financial ReportingManagement's Report on Responsibility for Financial StatementsManagement is responsible for the Consolidated Financial Statements and the other financial information contained in this Annual Report on Form 10-K. Thefinancial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP) and areconsidered by management to present fairly the company's financial position, results of operations and cash flows. The financial statements include someamounts that are based on management's best estimates and judgments. The financial statements have been audited by the company's independent registeredpublic accounting firm, PricewaterhouseCoopers LLP. The purpose of their audit is to express an opinion as to whether the Consolidated Financial Statementsincluded in this Annual Report on Form 10-K present fairly, in all material respects, the company's financial position, results of operations and cash flows inconformity with GAAP. Their report is presented on the following page.Management's Report on Internal Control over Financial ReportingManagement is responsible for establishing and maintaining an adequate system of internal control over financial reporting as defined in Rules 13a-15(f) and15d-15(f) under the Securities Exchange Act of 1934. The company's internal control over financial reporting is a process designed to provide reasonableassurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Thecompany's internal control over financial reporting includes those policies and procedures that:i.pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of thecompany;ii.provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company are being made only in accordance with authorization ofmanagement and directors of the company; andiii.provide reasonable assurance regarding prevention or timely detection of unauthorized acquisitions, use or disposition of the company's assets thatcould have a material effect on the financial statements.Internal control over financial reporting has certain inherent limitations which may not prevent or detect misstatements. In addition, changes in conditions andbusiness practices may cause variation in the effectiveness of internal controls.Management assessed the effectiveness of the company's internal control over financial reporting as of December 31, 2012, based on criteria set forth by theCommittee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework. Based on its assessment andthose criteria, management concluded that the company maintained effective internal control over financial reporting as of December 31, 2012.PricewaterhouseCoopers LLP, an independent registered public accounting firm, has audited the effectiveness of the company's internal control over financialreporting as of December 31, 2012, as stated in their report, which is presented on the following page. Ellen J. KullmanChair of the Board andChief Executive Officer Nicholas C. FanandakisExecutive Vice Presidentand Chief Financial OfficerFebruary 6, 2013F-2 Report of Independent Registered Public Accounting FirmTo the Stockholders and the Board of Directors ofE. I. du Pont de Nemours and Company:In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of income, comprehensive income, equity and cashflows present fairly, in all material respects, the financial position of E. I. du Pont de Nemours and Company and its subsidiaries at December 31, 2012 and2011, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2012 in conformity with accountingprinciples generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule listed in the index appearing underItem 15(a) (2) presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financialstatements. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2012,based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the TreadwayCommission (COSO). The Company's management is responsible for these financial statements and financial statement schedule, for maintaining effectiveinternal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in "Management'sReport on Internal Control over Financial Reporting" appearing on page F-2. Our responsibility is to express opinions on these financial statements, on thefinancial statement schedule and on the Company's internal control over financial reporting based on our integrated audits. We conducted our audits inaccordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform theaudits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control overfinancial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting theamounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluatingthe overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control overfinancial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal controlbased on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe our auditsprovide a reasonable basis for our opinions.A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting andthe preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control overfinancial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflectthe transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are beingmade only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention ortimely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation ofeffectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliancewith the policies or procedures may deteriorate.PricewaterhouseCoopers LLPPhiladelphia, PennsylvaniaFebruary 6, 2013F-3 E. I. du Pont de Nemours and CompanyConsolidated Financial StatementsCONSOLIDATED INCOME STATEMENTS(Dollars in millions, except per share)For the year ended December 31,201220112010Net sales$34,812$33,681$27,700Other income, net4987421,199Total35,31034,42328,899Cost of goods sold and other operating charges25,60424,87420,574Selling, general and administrative expenses3,5673,3582,912Research and development expense2,0671,9101,603Interest expense464447590Employee separation / asset related charges, net49353(40)Total32,19530,64225,639Income from continuing operations before income taxes3,1153,7813,260Provision for income taxes on continuing operations622626515Income from continuing operations after income taxes2,4933,1552,745Income from discontinued operations after income taxes320355307Net income2,8133,5103,052Less: Net income attributable to noncontrolling interests253621Net income attributable to DuPont$2,788$3,474$3,031Basic earnings per share of common stock: Basic earnings per share of common stock from continuing operations$2.63$3.35$2.99Basic earnings per share of common stock from discontinued operations0.340.380.34Basic earnings per share of common stock$2.98$3.73$3.32Diluted earnings per share of common stock: Diluted earnings per share of common stock from continuing operations$2.61$3.30$2.94Diluted earnings per share of common stock from discontinued operations0.340.380.33Diluted earnings per share of common stock$2.95$3.68$3.28Dividends per share of common stock$1.70$1.64$1.64See Notes to the Consolidated Financial Statements beginning on page F-9.F-4 E. I. du Pont de Nemours and CompanyConsolidated Financial StatementsCONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME(Dollars in millions, except per share)For the year ended December 31,201220112010Net income$2,813$3,510$3,052Other comprehensive income (loss), before tax: Cumulative translation adjustment77(457)(6) Net revaluation and clearance of cash flow hedges to earnings: Additions and revaluations of derivatives designated as cash flow hedges810(33) Clearance of hedge results to earnings(65)9690 Net revaluation and clearance of cash flow hedges to earnings(57)10657 Pension benefit plans: Net loss(1,433)(4,069)(635) Prior service benefit (cost)22(2)— Reclassifications to net income: Amortization of prior service cost131616 Amortization of loss887613507 Curtailment / settlement loss7—— Pension benefit plans, net(504)(3,442)(112) Other benefit plans: Net loss(60)(437)(94) Prior service benefit (cost)857(11)189 Reclassifications to net income: Amortization of prior service benefit(155)(121)(106) Amortization of loss946058 Curtailment loss3—— Other benefit plans, net739(509)47 Net unrealized (loss) gain on securities(2)22Other comprehensive income (loss), before tax253(4,300)(12) Income tax (expense) benefit related to items of other comprehensive income(121)1,322(5)Other comprehensive income (loss), net of tax132(2,978)(17)Comprehensive income2,9455323,035 Less: Comprehensive income attributable to noncontrolling interests531823Comprehensive income attributable to DuPont$2,892$514$3,012See Notes to the Consolidated Financial Statements beginning on page F-9.F-5 E. I. du Pont de Nemours and CompanyConsolidated Financial StatementsCONSOLIDATED BALANCE SHEETS(Dollars in millions, except per share)December 31,20122011Assets Current assets Cash and cash equivalents$4,284$3,586Marketable securities123433Accounts and notes receivable, net5,4526,022Inventories7,4227,195Prepaid expenses204151Deferred income taxes650671Assets held for sale3,056—Total current assets21,19118,058Property, plant and equipment31,82632,761Less: Accumulated depreciation19,08519,349Net property, plant and equipment12,74113,412Goodwill4,6165,413Other intangible assets5,1265,413Investment in affiliates1,1631,117Deferred income taxes3,9394,067Other assets9601,012Total$49,736$48,492Liabilities and Equity Current liabilities Accounts payable$4,853$4,816Short-term borrowings and capital lease obligations1,275817Income taxes340255Other accrued liabilities5,9975,297Liabilities related to assets held for sale1,084—Total current liabilities13,54911,185Long-term borrowings and capital lease obligations10,46511,736Other liabilities14,68715,508Deferred income taxes8561,001Total liabilities39,55739,430Commitments and contingent liabilitiesStockholders' Equity Preferred stock, without par value – cumulative; 23,000,000 shares authorized; issued at December 31, 2012 and 2011: $4.50 Series – 1,673,000 shares (callable at $120)167167$3.50 Series – 700,000 shares (callable at $102)7070Common stock, $.30 par value; 1,800,000,000 shares authorized; issued at December 31, 2012 – 1,020,057,000; 2011 – 1,013,164,000306304Additional paid-in capital10,63210,107Reinvested earnings14,28613,422Accumulated other comprehensive loss(8,646)(8,750)Common stock held in treasury, at cost (Shares: December 31, 2012 and 2011 – 87,041,000)(6,727)(6,727)Total DuPont stockholders' equity10,0888,593Noncontrolling interests91469Total equity10,1799,062Total$49,736$48,492See Notes to the Consolidated Financial Statements beginning on page F-9.F-6 E. I. du Pont de Nemours and CompanyConsolidated Financial StatementsCONSOLIDATED STATEMENTS OF EQUITY(Dollars in millions, except per share) PreferredStockCommonStockAdditionalPaid-inCapitalReinvestedEarningsAccumulatedOtherCompre-hensiveLossTreasuryStockNon-controllingInterestsTotalEquity2010 Balance January 1, 2010$237$297$8,469$10,710$(5,771)$(6,727)$436$7,651Acquisition of a majority interest in a consolidatedsubsidiary 99Net income 3,031 213,052Other comprehensive income (loss) (19) 2(17)Common dividends ($1.64 per share) (1,500) (3)(1,503)Preferred dividends (10) (10)Common stock issued - compensation plans 6805 811Common stock repurchased (250) (250)Common stock retired (2)(47)(201) 250 —Balance December 31, 2010$237$301$9,227$12,030$(5,790)$(6,727)$465$9,7432011 Sale of a majority interest in a consolidatedsubsidiary (3)(3)Net income 3,474 363,510Other comprehensive income (loss) (2,960) (18)(2,978)Common dividends ($1.64 per share) (1,531) (11)(1,542)Preferred dividends (10) (10)Common stock issued - compensation plans 71,007 1,014Common stock repurchased (672) (672)Common stock retired (4)(127)(541) 672 —Balance December 31, 2011$237$304$10,107$13,422$(8,750)$(6,727)$469$9,0622012 Acquisitions of a noncontrolling interest inconsolidated subsidiaries (25) (370)(395)Net income 2,788 252,813Other comprehensive income (loss) 104 28132Common dividends ($1.70 per share) (1,593) (61)(1,654)Preferred dividends (10) (10)Common stock issued - compensation plans 4627 631Common stock repurchased (400) (400)Common stock retired (2)(77)(321) 400 —Balance December 31, 2012$237$306$10,632$14,286$(8,646)$(6,727)$91$10,179See Notes to the Consolidated Financial Statements beginning on page F-9.F-7 E. I. du Pont de Nemours and CompanyConsolidated Financial StatementsCONSOLIDATED STATEMENTS OF CASH FLOWS(Dollars in millions)For the year ended December 31,201220112010Operating activities Net income$2,813$3,510$3,052Adjustments to reconcile net income to cash provided by operating activities: Depreciation1,3761,2831,204Amortization of intangible assets337277176Other operating charges and credits – net1,186992809Contributions to pension plans(848)(341)(782)(Increase) decrease in operating assets: Accounts and notes receivable114(360)(481)Inventories and other operating assets(857)(902)(512)Increase (decrease) in operating liabilities: Accounts payable and other operating liabilities1,0375261,010Accrued interest and income taxes(309)16783Cash provided by operating activities4,8495,1524,559Investing activities Purchases of property, plant and equipment(1,793)(1,843)(1,508)Investments in affiliates(97)(67)(100)Payments for businesses – net of cash acquired(18)(6,459)(637)Proceeds from sale of assets – net of cash sold302214195Net decrease (increase) in short-term financial instruments3152,149(457)Forward exchange contract settlements(40)(227)176Other investing activities – net(15)(5)(108)Cash used for investing activities(1,346)(6,238)(2,439)Financing activities Dividends paid to stockholders(1,594)(1,533)(1,501)Net (decrease) increase in short-term (less than 90 days) borrowings(200)18520Long-term and other borrowings: Receipts3232,5392,061Payments(916)(1,163)(2,859)Repurchase of common stock(400)(672)(250)Proceeds from exercise of stock options550952708Payments for noncontrolling interest(470)——Other financing activities – net1095(8)Cash (used for) provided by financing activities(2,697)403(1,829)Effect of exchange rate changes on cash(13)6(49)Cash classified as held for sale(95)——Increase (decrease) in cash and cash equivalents698(677)242Cash and cash equivalents at beginning of year3,5864,2634,021Cash and cash equivalents at end of year$4,284$3,586$4,263Supplemental cash flow information: Cash paid during the year for Interest, net of amounts capitalized$501$455$623Income taxes1,054527416See Notes to the Consolidated Financial Statements beginning on page F-9.F-8E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESThe company follows generally accepted accounting principles in the United States of America (GAAP). The significant accounting policies described below,together with the other notes that follow, are an integral part of the Consolidated Financial Statements.Preparation of Financial StatementsThe preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts ofassets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expensesduring the reporting period. Actual results could differ from those estimates.Basis of ConsolidationThe Consolidated Financial Statements include the accounts of the company, subsidiaries in which a controlling interest is maintained and variable interestentities (VIEs) for which DuPont is the primary beneficiary. For those consolidated subsidiaries in which the company's ownership is less than 100 percent,the outside stockholders' interests are shown as noncontrolling interests. Investments in affiliates over which the company has significant influence but not acontrolling interest are carried on the equity method. At December 31, 2012, the assets, liabilities and operations of VIEs for which DuPont is the primarybeneficiary were not material to the Consolidated Financial Statements of the company.The company is also involved with certain joint ventures accounted for under the equity method of accounting that are VIEs. The company is not the primarybeneficiary, as the nature of the company's involvement with the VIEs does not provide it the power to direct the VIEs significant activities. Future events mayrequire these VIEs to be consolidated if the company becomes the primary beneficiary. At December 31, 2012, the maximum exposure to loss related to theunconsolidated VIEs is not considered material to the Consolidated Financial Statements of the company.Basis of PresentationCertain reclassifications of prior year's data have been made to conform to current year's presentation. In the third quarter 2012, the company signed adefinitive agreement to sell its Performance Coatings business (which represented a reportable segment). In accordance with GAAP, the results of PerformanceCoatings are presented as discontinued operations and, as such, have been excluded from continuing operations in the Consolidated Income Statements andfrom segment results for all periods presented. The sum of the individual earnings per share amounts from continuing and discontinued operations may notequal the total company earnings per share amounts due to rounding. The assets and liabilities of Performance Coatings at December 31, 2012 have beenreclassified and segregated as held for sale in the Consolidated Balance Sheet while corresponding amounts at prior year-ends have not been reclassified andpresented as such. The cash flows and comprehensive income related to Performance Coatings have not been segregated and are included in the ConsolidatedStatements of Cash Flows and Comprehensive Income, respectively, for all periods presented. Amounts related to Performance Coatings are consistentlyincluded in or excluded from the Notes to the Consolidated Financial Statements based on the financial statement line item and period of each disclosure. SeeNote 2 to the Consolidated Financial Statements for further information.Revenue RecognitionThe company recognizes revenue when the earnings process is complete. The company's revenues are from the sale of a wide range of products to a diversifiedbase of customers around the world. Revenue for product sales is recognized upon delivery, when title and risk of loss have been transferred, collectability isreasonably assured and pricing is fixed or determinable. Substantially all product sales are sold FOB (free on board) shipping point or, with respect to nonUnited States of America (U.S.) customers, an equivalent basis. Accruals are made for sales returns and other allowances based on the company's experience.The company accounts for cash sales incentives as a reduction in sales and noncash sales incentives as a charge to cost of goods sold or selling expense,depending on the nature of the incentive. Amounts billed to customers for shipping and handling fees are included in net sales and costs incurred by thecompany for the delivery of goods are classified as cost of goods sold and other operating charges in the Consolidated Income Statements. Taxes on revenue-producing transactions are excluded from net sales.The company periodically enters into prepayment contracts with customers in the Agriculture segment and receives advance payments for product to bedelivered in future periods. These advance payments are recorded as deferred revenue (classified as other accrued liabilities) or debt, depending on the nature ofthe program. Revenue associated with advance payments is recognized as shipments are made and title, ownership and risk of loss pass to the customer.Licensing and royalty income is recognized in accordance with agreed upon terms, when performance obligations are satisfied, the amount is fixed ordeterminable and collectability is reasonably assured.F-9E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Cash and Cash EquivalentsCash equivalents represent investments with maturities of three months or less from time of purchase. They are carried at cost plus accrued interest. Theestimated fair value of the company's cash equivalents was determined using level 2 inputs within the fair value hierarchy, as described below. Based oncurrent interest rates for similar investments with comparable credit risk and time to maturity, the fair value of the company's cash equivalents approximatesits stated value of $2,026 and $1,932 as of December 31, 2012 and 2011, respectively.Marketable SecuritiesMarketable securities represent investments in fixed and floating rate financial instruments with maturities greater than three months and up to twelve monthsat time of purchase. They are classified as held-to-maturity and recorded at amortized cost. The carrying value approximates fair value due to the short-termnature of the investments.Fair Value MeasurementsUnder the accounting for fair value measurements and disclosures, a fair value hierarchy was established that prioritizes the inputs to valuation techniquesused to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1measurements) and the lowest priority to unobservable inputs (level 3 measurements). A financial instrument's level within the fair value hierarchy is based onthe lowest level of any input that is significant to the fair value measurement.The company uses the following valuation techniques to measure fair value for its assets and liabilities:Level 1–Quoted market prices in active markets for identical assets or liabilities; Level 2–Significant other observable inputs (e.g. quoted prices for similar items in active markets, quoted prices for identical or similar itemsin markets that are not active, inputs other than quoted prices that are observable such as interest rate and yield curves, and market-corroborated inputs); Level 3–Unobservable inputs for the asset or liability, which are valued based on management's estimates of assumptions that marketparticipants would use in pricing the asset or liability.InventoriesThe majority of the company's inventories are valued at cost, as determined by the last-in, first-out (LIFO) method; in the aggregate, such valuations are not inexcess of market. Seed, certain food-ingredient and enzyme inventories are valued at the lower of cost, as determined by the first-in, first-out (FIFO) method, ormarket.Elements of cost in inventories include raw materials, direct labor and manufacturing overhead. Stores and supplies are valued at cost or market, whichever islower; cost is generally determined by the average cost method.Property, Plant and EquipmentProperty, plant and equipment is carried at cost and is depreciated using the straight-line method. Property, plant and equipment placed in service prior to1995 is depreciated under the sum-of-the-years' digits method or other substantially similar methods. Substantially all equipment and buildings aredepreciated over useful lives ranging from 15 to 25 years. Capitalizable costs associated with computer software for internal use are amortized on a straight-line basis over 5 to 7 years. When assets are surrendered, retired, sold or otherwise disposed of, their gross carrying values and related accumulateddepreciation are removed from the accounts and included in determining gain or loss on such disposals.Maintenance and repairs are charged to operations; replacements and improvements are capitalized.Goodwill and Other Intangible AssetsGoodwill represents the future economic benefits arising from other assets acquired in a business combination that are not individually identified andseparately recognized. Goodwill and indefinite-lived intangible assets are tested for impairment at least annually; however, these tests are performed morefrequently when events or changes in circumstances indicate that the asset may be impaired. Impairment exists when carrying value exceeds fair value. Thecompany's fair value methodology is based on prices of similar assets or other valuation methodologies including discounted cash flow techniques.Impairment losses are included in cost of goods sold and other operating charges.F-10E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Definite-lived intangible assets, such as purchased and licensed technology, patents and customer lists are amortized over their estimated useful lives,generally for periods ranging from 1 to 20 years. The company continually evaluates the reasonableness of the useful lives of these assets. Once these assetsare fully amortized, they are removed from the Consolidated Balance Sheets.Impairment of Long-Lived AssetsThe company evaluates the carrying value of long-lived assets to be held and used when events or changes in circumstances indicate the carrying value maynot be recoverable. The carrying value of a long-lived asset is considered impaired when the total projected undiscounted cash flows from the asset areseparately identifiable and are less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fairvalue of the long-lived asset. The company's fair value methodology is an estimate of fair market value which is made based on prices of similar assets orother valuation methodologies including present value techniques. Long-lived assets to be disposed of other than by sale are classified as held for use until theirdisposal. Long-lived assets to be disposed of by sale are classified as held for sale and are reported at the lower of carrying amount or fair market value lesscost to sell. Depreciation is discontinued for long-lived assets classified as held for sale.Research and DevelopmentResearch and development costs are expensed as incurred.EnvironmentalAccruals for environmental matters are recorded in operating expenses when it is probable that a liability has been incurred and the amount of the liability canbe reasonably estimated. Accrued liabilities do not include claims against third parties and are not discounted.Costs related to environmental remediation and restoration are charged to expense. Other environmental costs are also charged to expense unless they increasethe value of the property or reduce or prevent contamination from future operations, in which case, they are capitalized.Asset Retirement ObligationsThe company records asset retirement obligations at fair value at the time the liability is incurred. Accretion expense is recognized as an operating expense usingthe credit-adjusted risk-free interest rate in effect when the liability was recognized. The associated asset retirement obligations are capitalized as part of thecarrying amount of the long-lived asset and depreciated over the estimated remaining useful life of the asset, generally for periods ranging from 1 to 25 years.LitigationThe company accrues for liabilities related to litigation matters when the information available indicates that it is probable that a liability has been incurred andthe amount of the liability can be reasonably estimated. Legal costs such as outside counsel fees and expenses are charged to expense in the period incurred.Insurance/Self-InsuranceThe company self-insures certain risks where permitted by law or regulation, including workers' compensation, vehicle liability and employee related benefits.Liabilities associated with these risks are estimated in part by considering historical claims experience, demographic factors and other actuarial assumptions.For other risks, the company uses a combination of insurance and self-insurance, reflecting comprehensive reviews of relevant risks. A receivable for aninsurance recovery is generally recognized when the loss has occurred and collection is considered probable.Income TaxesThe provision for income taxes is determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred taxesrepresent the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid. The provision for income taxesrepresents income taxes paid or payable for the current year plus the change in deferred taxes during the year. Deferred taxes result from differences between thefinancial and tax basis of the company's assets and liabilities and are adjusted for changes in tax rates and tax laws when changes are enacted. Valuationallowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. Provision has been made for incometaxes on unremitted earnings of subsidiaries and affiliates, except for subsidiaries in which earnings are deemed to be indefinitely invested. Investment taxcredits or grants are accounted for in the period earned (the flow-through method). Interest accrued related to unrecognized tax benefits is included inmiscellaneous income and expenses, net, under other income, net. Income tax related penalties are included in the provision for income taxes.F-11E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Foreign Currency TranslationThe company's worldwide operations utilize the U.S. dollar or local currency as the functional currency, where applicable. For subsidiaries where the USD isthe functional currency, all foreign currency asset and liability amounts are remeasured into USD at end-of-period exchange rates, except for inventories,prepaid expenses, property, plant and equipment, goodwill and other intangible assets, which are remeasured at historical rates. Foreign currency income andexpenses are remeasured at average exchange rates in effect during the year, except for expenses related to balance sheet amounts remeasured at historicalexchange rates. Exchange gains and losses arising from remeasurement of foreign currency-denominated monetary assets and liabilities are included in incomein the period in which they occur.For subsidiaries where the local currency is the functional currency, assets and liabilities denominated in local currencies are translated into USD at end-of-period exchange rates and the resultant translation adjustments are reported, net of their related tax effects, as a component of accumulated other comprehensiveincome (loss) in equity. Assets and liabilities denominated in other than the local currency are remeasured into the local currency prior to translation into USDand the resultant exchange gains or losses are included in income in the period in which they occur. Income and expenses are translated into USD at averageexchange rates in effect during the period.Hedging and Trading ActivitiesDerivative instruments are reported in the Consolidated Balance Sheets at their fair values. For derivative instruments designated as fair value hedges, changesin the fair values of the derivative instruments will generally be offset in the income statement by changes in the fair value of the hedged items. For derivativeinstruments designated as cash flow hedges, the effective portion of any hedge is reported in accumulated other comprehensive income (loss) until it is clearedto earnings during the same period in which the hedged item affects earnings. The ineffective portion of all hedges is recognized in current period earnings.Changes in the fair values of derivative instruments that are not designated as hedges are recorded in current period earnings.In the event that a derivative designated as a hedge of a firm commitment or an anticipated transaction is terminated prior to the maturation of the hedgedtransaction, gains or losses realized at termination are deferred and included in the measurement of the hedged transaction. If a hedged transaction matures, oris sold, extinguished, or terminated prior to the maturity of a derivative designated as a hedge of such transaction, gains or losses associated with the derivativethrough the date the transaction matured are included in the measurement of the hedged transaction and the derivative is reclassified as for trading purposes.Derivatives designated as a hedge of an anticipated transaction are reclassified as for trading purposes if the anticipated transaction is no longer probable.Cash flows from derivative instruments accounted for as either fair value hedges or cash flow hedges are reported in the same category as the cash flows fromthe items being hedged. Cash flows from all other derivative instruments are generally reported as investing activities in the Consolidated Statements of CashFlows. See Note 20 for additional discussion regarding the company's objectives and strategies for derivative instruments.2. DISCONTINUED OPERATIONSOn August 30, 2012, the company entered into a definitive agreement with Flash Bermuda Co. Ltd., a Bermuda exempted limited liability company formed byaffiliates of The Carlyle Group (collectively referred to as "Carlyle") in which Carlyle agreed to purchase certain subsidiaries and assets comprising thecompany's Performance Coatings business for approximately $4,900 in cash and the assumption of certain liabilities. On February 1, 2013, the sale ofPerformance Coatings was completed, resulting in about $4,000 in after-tax proceeds.F-12E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)The results of discontinued operations are summarized below:For the year ended December 31,201220112010Net sales$4,218$4,280$3,805Income before income taxes$568$501$451Provision for income taxes1248146144Income from discontinued operations after income taxes$320$355$3071. Full year 2012 includes expense of $70 to accrue taxes associated with earnings of certain Performance Coatings subsidiaries that were previously considered permanently reinvestedas these entities have been reclassified as held for sale.The key components of the assets and liabilities classified as held for sale at December 31, 2012 related to Performance Coatings consisted of the following: December 31, 2012Cash and cash equivalents$95Accounts and notes receivable, net783Inventories468Prepaid expenses6Deferred income taxes - current32Property, plant and equipment, net of accumulated depreciation749Goodwill808Other intangible assets67Deferred income taxes - noncurrent14Other assets - noncurrent34Total assets held for sale$3,056Accounts payable$408Income taxes17Other accrued liabilities237Other liabilities - noncurrent388Deferred income taxes - noncurrent34Total liabilities related to assets held for sale$1,0843. EMPLOYEE SEPARATION/ASSET RELATED CHARGES, NETAt December 31, 2012, total liabilities relating to restructuring activities were $180, primarily relating to the 2012 restructuring program.2012 Restructuring ProgramIn 2012, the company commenced a restructuring plan to increase productivity, enhance competitiveness and accelerate growth. The plan is designed toeliminate corporate costs previously allocated to the Performance Coatings business as well as utilize additional cost-cutting actions to improvecompetitiveness. As a result, pre-tax charges of $234 were recorded in employee separation / asset related charges, net. The 2012 charges consist of $157 ofemployee separation costs, $8 of other non-personnel charges, and $69 of asset related charges, which includes $30 of asset impairments and $39 of assetshut downs.The 2012 restructuring program charges impacted segment earnings as follows: Agriculture - $11, Electronics & Communications - $9, IndustrialBiosciences - $3, Nutrition & Health - $53, Performance Chemicals - $3, Performance Materials - $13, and Safety & Protection - $58, as well as Corporateexpenses - $84. The company expects this plan and all related payments to be substantially complete by December 31, 2013.F-13E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Account balances and activity for the 2012 restructuring program are summarized below: Asset RelatedEmployee SeparationCostsOther Non-PersonnelCharges1TotalCharges to income in 2012$69$157$8$234Charges to accounts: Payments—(4)(1)(5)Net translation adjustment—1—1Asset write-offs and adjustments(69)——(69)Balance as of December 31, 2012$—$154$7$1611. Other non-personnel charges consist of contractual obligation costs.2011 Restructuring ProgramIn 2011, the company initiated a series of actions to achieve the expected cost synergies associated with the Danisco acquisition. As a result, the companyrecorded a $53 charge in employee separation/asset related charges, net, primarily for employee separation costs in the U.S. and Europe which reducedsegment earnings as follows: Industrial Biosciences - $9, Nutrition & Health - $14, and Other - $30.In the fourth quarter 2012, the company recorded a net reduction of $15 in the estimated costs associated with the 2011 restructuring program. This netreduction was primarily due to lower than estimated individual severance costs and workforce reductions through non-severance programs. The net reductionimpacted segment earnings for the year ended December 31, 2012 as follows: Nutrition & Health - $4 and Other - $11. There were $17 of employee separationcash payments related to the 2011 restructuring program during 2012. The actions and payments related to the 2011 restructuring program were substantiallycomplete as of December 31, 2012.Asset ImpairmentsDuring 2012, as a result of strategic decisions related to deteriorating conditions within a specific industrial chemicals market, the company determined thatan impairment triggering event had occurred and that an assessment of the asset group related to this industrial chemical was warranted. This assessmentdetermined that the carrying value of the asset group exceeded its fair value. As a result of the impairment test, a $33 pre-tax impairment charge was recordedduring 2012 within the Performance Chemicals segment.During 2012, as a result of conditions in the thin film photovoltaic market, the company determined that an impairment triggering event had occurred and thatan assessment of the asset group related to its thin film photovoltaic modules and systems was warranted. This assessment determined that the carrying valueof the asset group exceeded its fair value. As a result of the impairment test, a $150 pre-tax impairment charge was recorded during 2012 within theElectronics & Communications segment.During 2012, as a result of deteriorating conditions in an industrial polymer market, the company determined that an impairment triggering event hadoccurred and that an assessment of the asset group related to this polymer product was warranted. This assessment determined that the carrying value of theasset group exceeded its fair value. As a result of the impairment test, a $92 pre-tax impairment charge was recorded during 2012 within the PerformanceMaterials segment.The bases of the fair value for the charges above were calculated utilizing a discounted cash flow approach which included assumptions concerning futureoperating performance and economic conditions that may differ from actual cash flows. In connection with the matters discussed above, as of December 31,2012, the company had long-lived assets with a remaining net book value of approximately $150 accounted for at fair value on a nonrecurring basis afterinitial recognition. These nonrecurring fair value measurements were determined using level 3 inputs within the fair value hierarchy, as described in Note 1 tothe Consolidated Financial Statements.F-14E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)4. DANISCO ACQUISITIONIn January 2011, DuPont and its wholly owned subsidiary, DuPont Denmark Holding ApS (DDHA), entered into a definitive agreement with Danisco A/S(Danisco), a global enzyme and specialty food ingredients company, for DDHA to make a public tender offer for all of Danisco's outstanding shares at a priceof 665 Danish Kroner (DKK) in cash per share. On April 29, 2011, DDHA increased the price of its tender offer to acquire all of the outstanding shares ofDanisco to DKK 700 in cash per share.On May 19, 2011, the company acquired approximately 92.2 percent of Danisco's outstanding shares, excluding treasury shares, pursuant to the previouslyannounced tender offer. From May 19, 2011 to September 22, 2011, DuPont acquired all of Danisco's remaining outstanding shares. This acquisition hasestablished DuPont as a leader in industrial biotechnology with science-intensive innovations that address global challenges in food production and reducedfossil fuel consumption. The Danisco acquisition was valued at $6,417, plus net debt assumed of $617.As part of the Danisco acquisition, DuPont incurred $85 in transaction related costs during 2011, which were recorded in costs of goods sold and otheroperating charges. In 2011, Danisco contributed net sales of $1,713 and net income attributable to DuPont of $(7), which excludes $30 after-tax ($39 pre-tax)of additional interest expense related to the debt issued to finance the acquisition. Danisco's contributions included a $125 after-tax ($175 pre-tax) chargerelated to the fair value step-up of inventories acquired and sold during 2011.The following table summarizes the fair value of the assets acquired and liabilities assumed as of the acquisition date:Fair value of assets acquired Cash and cash equivalents$48Accounts and notes receivable 1522Inventories 2709Property, plant and equipment1,709Goodwill 32,891Other intangible assets 42,859Other current and non-current assets78Total assets acquired$8,816Fair value of liabilities assumed Accounts payable and other accrued liabilities$489Short-term borrowings 5342Long-term borrowings 5323Other liabilities219Deferred income taxes 61,026Total liabilities assumed$2,3991. The gross amount of accounts and notes receivable acquired was $531, of which $9 was expected to be uncollectible.2.The fair value of inventories acquired included a step-up in the value of $175, which was expensed to cost of goods sold and other operating charges in 2011.3.Goodwill will not be deductible for statutory tax purposes. Goodwill is attributable to Danisco's workforce and the synergies in technology, operations and market access that areexpected from the acquisition. Approximately $900 and $2,000 of goodwill was allocated to the Industrial Biosciences and Nutrition & Health segments, respectively.4. Other intangible assets acquired of $1,002 are indefinite-lived (see Note 11).5. Debt assumed has been paid off as of December 31, 2011.6. The deferred income tax liabilities assumed represent the adjustments for the tax impact of fair value adjustments, primarily relating to definite-lived intangible assets.F-15E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)5. OTHER INCOME, NET 201220112010Cozaar®/Hyzaar® income$54$282$483Royalty income177189140Interest income10911092Equity in earnings of affiliates, excluding exchange gains/losses199191179Gain on sale of equity method investment122——Net gains on sales of assets13089121Net exchange losses1(215)(146)(11)Miscellaneous income and expenses, net22227195 $498$742$1,1991. The company routinely uses foreign currency exchange contracts to offset its net exposures, by currency, related to the foreign currency-denominated monetary assets and liabilities.The objective of this program is to maintain an approximately balanced position in foreign currencies in order to minimize, on an after-tax basis, the effects of exchange rate changeson net monetary asset positions. The net pre-tax exchange gains and losses are recorded in other income, net and the related tax impact is recorded in provision for income taxes oncontinuing operations on the Consolidated Income Statements. Exchange gains (losses) related to earnings of affiliates was $3, $1 and $(2) for 2012, 2011 and 2010, respectively.2. Miscellaneous income and expenses, net, generally includes interest items, insurance recoveries, litigation settlements and other items.6. PROVISION FOR INCOME TAXES 201220112010Current tax expense (benefit) on continuing operations: U.S. federal$121$353$(142)U.S. state and local16(20)(9)International663482401Total current tax expense on continuing operations800815250Deferred tax expense (benefit) on continuing operations: U.S. federal(103)(147)240U.S. state and local(46)(4)22International(29)(38)3Total deferred tax (benefit) expense on continuing operations(178)(189)265Provision for income taxes on continuing operations$622$626$515F-16E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)The significant components of deferred tax assets and liabilities at December 31, 2012 and 2011, are as follows: 20122011 AssetLiabilityAssetLiabilityDepreciation$—$1,696$—$1,781Accrued employee benefits5,1981675,562252Other accrued expenses1,1574991,020354Inventories2496819939Unrealized exchange gains/losses—56—35Tax loss/tax credit carryforwards/backs2,733—2,854—Investment in subsidiaries and affiliates819246259Amortization of intangibles581,335691,399Other270287250279Valuation allowance(1,914)—(1,971)— $7,832$4,200$8,029$4,398Net deferred tax asset$3,632 $3,631 An analysis of the company's effective income tax rate (EITR) on continuing operations is as follows: 201220112010Statutory U.S. federal income tax rate35.0 %35.0 %35.0 %Exchange gains/losses10.1(0.8)2.2Domestic operations2(2.3)(3.4)(3.3)Lower effective tax rates on international operations-net2(10.8)(11.7)(16.0)Tax settlements(2.0)(0.2)(2.1)Sale of a business—(2.3)— 20.0 %16.6 %15.8 %1. Principally reflects the impact of non-taxable exchange gains and losses resulting from remeasurement of foreign currency-denominated monetary assets and liabilities. Furtherinformation about the company's foreign currency hedging program is included in Note 20 under the heading Foreign Currency Risk.2. On January 2, 2013, U.S. tax law was enacted which extends through 2013 several expired or expiring temporary business tax provisions. In accordance with GAAP, thisextension will be taken into account in the quarter in which the legislation was enacted (i.e. first quarter 2013). The company is still quantifying the impact of this law change;however, it is expected that the retroactive 2012 benefit derived from these extenders will be approximately $70.Consolidated income from continuing operations before income taxes for U.S. and international operations was as follows: 201220112010U.S. (including exports)$652$701$793International2,4633,0802,467 $3,115$3,781$3,260The decrease in pre-tax earnings from continuing operations from 2011 to 2012 is primarily driven by pre-tax charges related to Imprelis® and employeeseparation/asset related charges in 2012, in addition to the results of the company's hedging program. See Note 3 and Note 16 for additional information. In2012 and 2011, the U.S. recorded exchange losses associated with the hedging program of $157 and $133, respectively. While the taxation of the amountsreflected on the chart above does not correspond precisely to the jurisdiction of taxation (due to taxation in multiple countries, exchange gains/losses, etc.), itrepresents a reasonable approximation of the income before income taxes split between U.S. and international jurisdictions. See Note 20 for additionalinformation regarding the company's hedging program.F-17E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Under the tax laws of various jurisdictions in which the company operates, deductions or credits that cannot be fully utilized for tax purposes during thecurrent year may be carried forward or back, subject to statutory limitations, to reduce taxable income or taxes payable in future or prior years. AtDecember 31, 2012, the tax effect of such carryforwards/backs, net of valuation allowance approximated $1,298. Of this amount, $1,074 has no expirationdate, $42 expires after 2012 but before the end of 2017 and $182 expires after 2017.At December 31, 2012, unremitted earnings of subsidiaries outside the U.S. totaling $13,179 were deemed to be indefinitely reinvested. No deferred taxliability has been recognized with regard to the remittance of such earnings. It is not practical to estimate the income tax liability that might be incurred if suchearnings were remitted to the U.S.Each year the company files hundreds of tax returns in the various national, state and local income taxing jurisdictions in which it operates. These tax returnsare subject to examination and possible challenge by the taxing authorities. Positions challenged by the taxing authorities may be settled or appealed by thecompany. As a result, there is an uncertainty in income taxes recognized in the company's financial statements in accordance with accounting for income taxesand accounting for uncertainty in income taxes. It is reasonably possible that changes to the company's global unrecognized tax benefits could be significant,however, due to the uncertainty regarding the timing of completion of audits and possible outcomes, a current estimate of the range of increases or decreasesthat may occur within the next twelve months cannot be made.The company and/or its subsidiaries files income tax returns in the U.S. federal jurisdiction, and various states and non-U.S. jurisdictions. With fewexceptions, the company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 1999. Areconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows: 201220112010Total unrecognized tax benefits as of January 1$800$693$739Gross amounts of decreases in unrecognized tax benefits as a result of tax positions taken during the prior period(94)(82)(155)Gross amounts of increases in unrecognized tax benefits as a result of tax positions taken during the prior period73170169Gross amounts of increases in unrecognized tax benefits as a result of tax positions taken during the current period787951Amount of decreases in the unrecognized tax benefits relating to settlements with taxing authorities(29)(6)(90)Reduction to unrecognized tax benefits as a result of a lapse of the applicable statute of limitations(10)(32)(24)Exchange gain (loss)(13)(22)3Total unrecognized tax benefits as of December 31$805$800$693Total unrecognized tax benefits that, if recognized, would impact the effective tax rate$693$683$545Total amount of interest and penalties recognized in the Consolidated Income Statements$4$7$(70)Total amount of interest and penalties recognized in the Consolidated Balance Sheets$116$113$99F-18E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)7. EARNINGS PER SHARE OF COMMON STOCKSet forth below is a reconciliation of the numerator and denominator for basic and diluted earnings per share calculations for the periods indicated: 201220112010Numerator: Income from continuing operations after income taxes attributable to DuPont$2,468$3,119$2,724Preferred dividends(10)(10)(10)Income from continuing operations after income taxes available to DuPont commonstockholders$2,458$3,109$2,714 Income from discontinued operations after income taxes$320$355$307 Net income available to common stockholders$2,778$3,464$3,021 Denominator: Weighted-average number of common shares outstanding – Basic933,275,000928,417,000908,860,000Dilutive effect of the company's employee compensation plans8,922,00012,612,00012,795,000Weighted average number of common shares outstanding – Diluted942,197,000941,029,000921,655,000The weighted-average number of common shares outstanding in 2012 and 2011 increased as a result of the issuance of new shares from the company's equitycompensation plans, partially offset by the company's repurchase and retirement of its common stock (see Note 17).The following average number of stock options are antidilutive and therefore, are not included in the diluted earnings per share calculation: 201220112010Average number of stock options12,158,0004,361,00045,508,000The change in the average number of stock options that were antidilutive in 2012 and 2011 was primarily due to changes in the company's average stockprice.F-19E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)8. ACCOUNTS AND NOTES RECEIVABLE, NETDecember 31,20122011Accounts receivable – trade1$4,069$4,598Notes receivable – trade1,2131207Other31,2521,217 $5,452$6,0221. Accounts and notes receivable – trade are net of allowances of $243 in 2012 and $292 in 2011. Allowances are equal to the estimated uncollectible amounts. That estimate is basedon historical collection experience, current economic and market conditions, and review of the current status of customers' accounts.2. Notes receivable – trade primarily consists of receivables within the Agriculture segment for deferred payment loan programs for the sale of seed products to customers. These loanshave terms of one year or less and are primarily concentrated in North America. The company maintains a rigid pre-approval process for extending credit to customers in order tomanage overall risk and exposure associated with credit losses. As of December 31, 2012 and 2011, there were no significant past due notes receivable, nor were there any significantimpairments related to current loan agreements.3. Other includes receivables in relation to Cozaar®/Hyzaar® interests, fair value of derivative instruments, value added tax, general sales tax and other taxes.Accounts and notes receivable are carried at amounts that approximate fair value.9. INVENTORIESDecember 31,20122011Finished products$4,519$4,541Semifinished products2,4072,293Raw materials, stores and supplies1,3321,262 8,2588,096Adjustment of inventories to a LIFO basis(836)(901) $7,422$7,195Inventory values, before LIFO adjustment, are generally determined by the average cost method, which approximates current cost. Domestic and foreigninventories, excluding seeds, certain food-ingredients, enzymes, stores and supplies, valued under the LIFO method comprised 85 percent and 78 percent ofconsolidated inventories before LIFO adjustment as of December 31, 2012 and 2011, respectively. Seed, certain food-ingredient and enzyme inventories of$3,926 and $3,432 at December 31, 2012 and 2011, respectively, were valued under the FIFO method. Stores and supplies inventories of $263 and $258 atDecember 31, 2012 and 2011, respectively, were valued under the average cost method.Effective January 1, 2013, the company changed its method of valuing inventory held at certain of its foreign and U.S. locations from the LIFO method to theaverage cost method. The company believes that the average cost method is preferable to the LIFO method as it more clearly aligns with how the companyactually manages its inventory and will improve financial reporting by better matching revenues and expenses. In addition, the change from LIFO to averagecost will enhance the comparability of our financial results with our peer companies. The impact of this change on income from continuing operations is $21,$(73), and $2 for 2012, 2011 and 2010, respectively. As described in the accounting guidance for accounting changes and error corrections, beginning withthe first quarter 2013, the comparative Consolidated Financial Statements of prior periods will be adjusted to apply the new accounting method retrospectively.10. PROPERTY, PLANT AND EQUIPMENTDecember 31,20122011Buildings$5,490$5,297Equipment24,09025,338Land691669Construction1,5551,457 $31,826$32,761F-20E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)11. GOODWILL AND OTHER INTANGIBLE ASSETSGoodwillThe following table summarizes changes in the carrying amount of goodwill for the years ended December 31, 2012 and 2011, by reportable segment: Balance as ofDecember 31, 2012GoodwillAdjustmentsandAcquisitionsBalance as ofDecember 31, 2011GoodwillAdjustmentsandAcquisitionsBalance as ofDecember 31, 2010Agriculture$231$(1)$232$4$228Electronics & Communications149—14932117Industrial Biosciences89024866866—Nutrition & Health2,314(8)2,3221,898424Performance Chemicals185—185—185Performance Coatings—(809)809—809Performance Materials401(3)404(6)410Safety & Protection446—4462444Total$4,616$(797)$5,413$2,796$2,617Changes in goodwill in 2012 primarily relate to goodwill associated with the Performance Coatings business that has been reclassified as held for sale (see Note2). Changes in goodwill in 2011 primarily relate to the goodwill associated with the Danisco acquisition (see Note 4). In 2012 and 2011, the companyperformed impairment tests for goodwill and determined that no goodwill impairments existed.F-21E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Other Intangible AssetsThe following table summarizes the gross carrying amounts and accumulated amortization of other intangible assets by major class: December 31, 2012December 31, 2011 GrossAccumulatedAmortizationNetGrossAccumulatedAmortizationNetIntangible assets subject to amortization (Definite-lived) Customer lists$1,847$(330)$1,517$1,841$(220)$1,621Patents525(127)398518(77)441Purchased and licensed technology1,929(1,016)9131,854(878)976Trademarks57(29)2857(25)32Other1206(98)108330(151)179 4,564(1,600)2,9644,600(1,351)3,249Intangible assets not subject to amortization (Indefinite-lived) In-process research and development62—6270—70Microbial cell factories2306—306306—306Pioneer germplasm3975—975975—975Trademarks/tradenames819—819813—813 2,162—2,1622,164—2,164Total$6,726$(1,600)$5,126$6,764$(1,351)$5,4131. Primarily consists of sales and grower networks, marketing and manufacturing alliances and noncompetition agreements.2. Microbial cell factories, derived from natural microbes, are used to sustainably produce enzymes, peptides and chemicals using natural metabolic processes. The company recognizedthe microbial cell factories as an intangible asset upon the acquisition of Danisco. This intangible asset is expected to contribute to cash flows beyond the foreseeable future andthere are no legal, regulatory, contractual, or other factors which limit its useful life.3. Pioneer germplasm is the pool of genetic source material and body of knowledge gained from the development and delivery stage of plant breeding. The company recognized germplasmas an intangible asset upon the acquisition of Pioneer. This intangible asset is expected to contribute to cash flows beyond the foreseeable future and there are no legal, regulatory,contractual, or other factors which limit its useful life.The aggregate pre-tax amortization expense from continuing operations for definite-lived intangible assets was $312, $253 and $155 for 2012, 2011 and2010, respectively. The estimated aggregate pre-tax amortization expense from continuing operations for 2013, 2014, 2015, 2016 and 2017 is $302, $333,$345, $301 and $173, respectively, which are primarily reported in cost of goods sold and other operating charges.12. SHORT-TERM BORROWINGS AND CAPITAL LEASE OBLIGATIONSDecember 31,20122011Commercial paper$—$390Other loans-various currencies2015Long-term debt payable within one year1,252410Capital lease obligations32 $1,275$817The estimated fair value of the company's short-term borrowings, including interest rate financial instruments, was determined using level 2 inputs within thefair value hierarchy, as described in Note 1 to the Consolidated Financial Statements. Based on quoted market prices for the same or similar issues, or oncurrent rates offered to the company for debt of the same remaining maturities, the fair value of the company's short-term borrowings was $1,300 and $830 atDecember 31, 2012 and 2011, respectively.F-22E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Unused bank credit lines were approximately $4,300 and $4,400 at December 31, 2012 and 2011, respectively. These lines are available to support short-termliquidity needs and general corporate purposes including letters of credit. Outstanding letters of credit were $503 and $354 at December 31, 2012 and 2011,respectively. These letters of credit support commitments made in the ordinary course of business.The weighted-average interest rate on short-term borrowings outstanding at December 31, 2012 and 2011 was 4.8% and 2.6%, respectively. The increase in theinterest rate for 2012 was primarily due to long-term debt maturing within one year.13. OTHER ACCRUED LIABILITIESDecember 31,20122011Compensation and other employee-related costs$1,092$1,189Deferred revenue2,7062,153Employee benefits (Note 18)367423Discounts and rebates318356Derivative instruments13136Miscellaneous1,3831,140 $5,997$5,297Deferred revenue principally includes advance customer payments within the Agriculture segment. Miscellaneous other accrued liabilities principally includesaccrued plant and operating expenses, accrued litigation costs, employee separation costs in connection with the company's restructuring programs, theestimated value of certain guarantees and accrued environmental remediation costs.F-23E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)14. LONG-TERM BORROWINGS AND CAPITAL LEASE OBLIGATIONSDecember 31,20122011U.S. dollar: Medium-term notes due 2013 – 20411,2$374$4014.75% notes due 20122—4005.00% notes due 201322502505.00% notes due 201327497475.875% notes due 20141701701.75% notes due 2014400400Floating rate notes due 201436006004.875% notes due 20144994993.25% notes due 201541,0541,0654.75% notes due 20154003991.95% notes due 20164974962.75% notes due 20164994995.25% notes due 20165995996.00% notes due 201851,3831,4055.75% notes due 20194994994.625% notes due 20209979973.625% notes due 20219999994.25% notes due 20214994996.50% debentures due 20282992995.60% notes due 20363953954.90% notes due 2041493493Other loans (average interest rate of 3.9 percent)2368Other loans-various currencies224 11,69312,123Less short-term portion of long-term debt1,252410 10,44111,713Capital lease obligations2423Total$10,465$11,7361. Average interest rates on medium-term notes at December 31, 2012 and 2011 were 4.0% and 3.7%, respectively.2. Includes long-term debt due within one year.3. Interest rate on floating rate notes at December 31, 2012 and 2011 was 0.7% and 1.0%, respectively.4. At December 31, 2012 and 2011, the company had outstanding interest rate swap agreements with gross notional amounts of $1,000. Over the remaining terms of the notes, thecompany will receive fixed payments equivalent to the underlying debt and pay floating payments based on USD LIBOR (London Interbank Offered Rate). The fair value ofoutstanding swaps was an asset of $55 and $66 at December 31, 2012 and 2011, respectively.5. During 2008, the interest rate swap agreement associated with these notes was terminated. The gain will be amortized over the remaining life of the bond, resulting in an effectiveyield of 3.85%.Maturities of long-term borrowings are $1,669, $1,455, $1,596 and $0 for the years 2014, 2015, 2016 and 2017, respectively, and $5,721 thereafter.The estimated fair value of the company's long-term borrowings, including interest rate financial instruments, was determined using level 2 inputs within thefair value hierarchy, as described in Note 1 to the Consolidated Financial Statements. Based on quoted market prices for the same or similar issues, or oncurrent rates offered to the company for debt of the same remaining maturities, the fair value of the company's long-term borrowings was $11,715 and$13,050 at December 31, 2012 and 2011, respectively.F-24E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)15. OTHER LIABILITIESDecember 31,20122011Employee benefits: Accrued other long-term benefit costs (Note 18)$3,271$4,063Accrued pension benefit costs (Note 18)9,3039,186Accrued environmental remediation costs353316Miscellaneous1,7601,943 $14,687$15,508Miscellaneous includes asset retirement obligations, litigation accruals, tax contingencies, royalty payables and certain obligations related to divestedbusinesses.16. COMMITMENTS AND CONTINGENT LIABILITIESGuaranteesIndemnificationsIn connection with acquisitions and divestitures, the company has indemnified respective parties against certain liabilities that may arise in connection withthese transactions and business activities prior to the completion of the transaction. The term of these indemnifications, which typically pertain toenvironmental, tax and product liabilities, is generally indefinite. In addition, the company indemnifies its duly elected or appointed directors and officers tothe fullest extent permitted by Delaware law, against liabilities incurred as a result of their activities for the company, such as adverse judgments relating tolitigation matters. If the indemnified party were to incur a liability or have a liability increase as a result of a successful claim, pursuant to the terms of theindemnification, the company would be required to reimburse the indemnified party. The maximum amount of potential future payments is generallyunlimited. The carrying amounts recorded for all indemnifications as of December 31, 2012 and 2011 were $31 and $105, respectively. The decrease in thecarrying amount at December 31, 2012 primarily relates to the payment associated with the settlement of the 2008 lawsuit filed by subsidiaries of KochIndustries, Inc. (INVISTA).Obligations for Equity Affiliates & OthersThe company has directly guaranteed various debt obligations under agreements with third parties related to equity affiliates, customers and suppliers. AtDecember 31, 2012, the company had directly guaranteed $535 of such obligations. This amount represents the maximum potential amount of future(undiscounted) payments that the company could be required to make under the guarantees. The company would be required to perform on these guarantees inthe event of default by the guaranteed party.The company assesses the payment/performance risk by assigning default rates based on the duration of the guarantees. These default rates are assignedbased on the external credit rating of the counterparty or through internal credit analysis and historical default history for counterparties that do not havepublished credit ratings. For counterparties without an external rating or available credit history, a cumulative average default rate is used.In certain cases, the company has recourse to assets held as collateral, as well as personal guarantees from customers and suppliers. Assuming liquidation,these assets are estimated to cover approximately 50 percent of the $350 of guaranteed obligations of customers and suppliers. Set forth below are thecompany's guaranteed obligations at December 31, 2012: Short-TermLong-TermTotalObligations for customers and suppliers1: Bank borrowings (terms up to 5 years)$284$64$348Leases on equipment and facilities (terms up to 4 years)—22Obligations for equity affiliates2: Bank borrowings (terms up to 1 year)185—185Total$469$66$5351. Existing guarantees for customers and suppliers arose as part of contractual agreements. As of December 31, 2012, approximately $14 of these guarantees relate to customers of thePerformance Coatings business.2. Existing guarantees for equity affiliates arose for liquidity needs in normal operations.F-25E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Operating LeasesThe company uses various leased facilities and equipment in its operations. The terms for these leased assets vary depending on the lease agreement.Future minimum lease payments (including residual value guarantee amounts) under non-cancelable operating leases are $320, $260, $213, $178 and $153for the years 2013, 2014, 2015, 2016 and 2017, respectively, and $290 for subsequent years and are not reduced by non-cancelable minimum subleaserentals due in the future in the amount of $3. Net rental expense under operating leases was $316, $268 and $229 in 2012, 2011 and 2010, respectively.Asset Retirement ObligationsThe company has recorded asset retirement obligations primarily associated with closure, reclamation and removal costs for mining operations related to theproduction of titanium dioxide in Performance Chemicals. The company's asset retirement obligation liabilities were $64 and $59 at December 31, 2012 and2011.Imprelis® The company has received claims and been served with multiple lawsuits alleging that the use of Imprelis® herbicide caused damage to certain trees. Thelawsuits seeking class action status have been consolidated in multidistrict litigation in federal court in Philadelphia, Pennsylvania. In addition, about 80individual actions on behalf of approximately 180 plaintiffs have been filed in state court in various jurisdictions. DuPont has removed most of these cases tofederal court in Philadelphia, Pennsylvania.DuPont and lead and liaison counsel for plaintiffs in the multidistrict litigation sought preliminary approval from the court of a class action settlement; thecourt scheduled a hearing on February 5, 2013. The settlement would incorporate the company's existing claims process and provide certain additional relief.The proposed settlement class would include affected property owners and lawn care companies who do not "opt out" of the settlement. DuPont would have theability to cancel the agreement if the number of “opt-outs” is unsatisfactory to DuPont. If the settlement is approved, DuPont would pay about $7 in plaintiffs'attorney fees and expenses and bear the costs of notifying potential class participants. In addition, DuPont would provide a warranty against new damage, ifany, caused by the use of Imprelis® on class members' properties through May 2015.In August 2011, the company suspended sales of Imprelis® and in September 2011 began a process to fairly resolve claims associated with the use ofImprelis®. The company believes that the number of unasserted claims is limited due to the fact that sales were suspended in August 2011 and the productwas last applied during the 2011 spring application season.The company has established review processes to verify and evaluate damage claims. There are several variables that impact the evaluation process includingthe number of trees on a property, the species of tree with reported damage, the height of the tree, the extent of damage and the possibility for trees to naturallyrecover over time. Upon receiving claims, DuPont verifies their accuracy and validity which often requires physical review of the property.In 2012 and 2011, DuPont had recorded charges of $575 and $175, respectively, to resolve these claims, bringing the total charges to $750 at December 31,2012. It is reasonably possible that additional charges could result related to this matter. While there is a high degree of uncertainty, total charges could rangeup to $900. Predicting the impact of Imprelis® on living organisms and how those organisms may react over time are significant factors driving theuncertainty of future charges. Imprelis® was applied throughout the United States and the ability of any particular species of tree to naturally recover over timemay be different depending on the property's geography and associated climate. The company has an applicable insurance program with a deductible equal tothe first $100 of costs and expenses. The insurance program limits are $725 for costs and expenses in excess of the $100. DuPont has submitted and willcontinue to submit requests for payment to its insurance carriers for costs associated with this matter.LitigationThe company is subject to various legal proceedings arising out of the normal course of its business including product liability, intellectual property,commercial, environmental and antitrust lawsuits. It is not possible to predict the outcome of these various proceedings. Except as otherwise noted,management does not anticipate their resolution will have a materially adverse effect on the company's consolidated financial position or liquidity. However,the ultimate liabilities could be significant to results of operations in the period recognized. F-26E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)PFOADuPont uses PFOA (collectively, perfluorooctanoic acids and its salts, including the ammonium salt), as a processing aid to manufacture some fluoropolymerresins at various sites around the world including its Washington Works plant in West Virginia. At December 31, 2012, DuPont has accruals of $15 relatedto the PFOA matters discussed below.The accrual includes charges related to DuPont's obligations under agreements with the U.S. Environmental Protection Agency and voluntary commitments tothe New Jersey Department of Environmental Protection. These obligations include surveying, sampling and testing drinking water in and around certaincompany sites and offering treatment or an alternative supply of drinking water if tests indicate the presence of PFOA in drinking water at or greater than thenational Provisional Health Advisory.Drinking Water ActionsIn August 2001, a class action, captioned Leach v DuPont, was filed in West Virginia state court alleging that residents living near the Washington Worksfacility had suffered, or may suffer, deleterious health effects from exposure to PFOA in drinking water.DuPont and attorneys for the class reached a settlement in 2004 that binds about 80,000 residents. In 2005, DuPont paid the plaintiffs’ attorneys’ fees andexpenses of $23 and made a payment of $70, which class counsel designated to fund a community health project. The company funded a series of healthstudies which were completed in October 2012 by an independent science panel of experts (the “C8 Science Panel”). The studies were conducted incommunities exposed to PFOA to evaluate available scientific evidence on whether any probable link exists, as defined in the settlement agreement, betweenexposure to PFOA and human disease. The C8 Science Panel found probable links, as defined in the settlement agreement, between exposure to PFOA and pregnancy-induced hypertension,including preeclampsia; kidney cancer; testicular cancer; thyroid disease; ulcerative colitis; and diagnosed higher cholesterol (hypocholesterolemia).A panel of three medical experts will determine an appropriate medical monitoring protocol, if any, as a result of these findings. If a medical monitoringprotocol for any of these diseases is defined, DuPont is required to fund a medical monitoring program to pay for such medical testing. Plaintiffs may pursuepersonal injury claims against DuPont only for those human diseases for which the C8 Science Panel determined a probable link exists. In January 2012, thecompany put $1 in an escrow account as required by the settlement agreement. Under the settlement agreement, the company's total obligation to pay formedical monitoring cannot exceed $235. In addition, the company must continue to provide water treatment designed to reduce the level of PFOA in water tosix area water districts, including the Little Hocking Water Association (LHWA), and private well users.An Ohio action brought by the LHWA is ongoing. In addition to general claims of PFOA contamination of drinking water, the action claims “imminent andsubstantial endangerment to health and or the environment” under the Resource Conservation and Recovery Act (RCRA). DuPont denies these claims and isdefending itself vigorously.At December 31, 2012, twenty-five lawsuits alleging personal injury and one lawsuit alleging wrongful death from exposure to PFOA in drinking water arepending in federal court in Ohio and West Virginia. DuPont denies the allegations in these lawsuits and is defending itself vigorously. While DuPont believes that it is reasonably possible that it could incur losses related to PFOA matters in addition to those matters discussed above for which ithas established accruals, a range of such losses, if any, cannot be reasonably estimated at this time.Monsanto Patent DisputeOn August 1, 2012, a St. Louis, Missouri jury awarded $1,000 in damages to Monsanto on its claims that the company willfully infringed Monsanto's RE39,247 patent directed to Roundup® Ready® soybean seed technology. On November 16, 2012, the court unsealed sanctions against the company for “fraudagainst the court,” which precluded the company from presenting a license defense at trial and ordered the company to pay Monsanto's attorneys' feesassociated with the sanctions. The court has yet to decide several post-trial motions, including Monsanto's motion to enhance the damage award. The court hasdiscretion to enhance damages for willful infringement by up to three times the jury verdict. The company intends to appeal this verdict, the sanctions rulingand damage enhancement, if any, when it is appropriate to do so. The company believes that it will prevail on appeal. Accordingly, as of December 31, 2012,no amounts have been accrued related to this matter.Monsanto alleged that by combining Pioneer's Optimum® GAT® trait with Monsanto's patented Roundup® Ready® trait, Pioneer violated its 2002 Amendedand Restated Roundup® Ready® Soybean License Agreement and, in doing so, infringed Monsanto'sF-27E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)RE 39,247 patent. The company has never sold soybeans containing a combination of the Optimum® GAT® and Roundup® Ready® traits and discontinuedin 2011 its commercialization efforts for such soybeans.Environmental The company is also subject to contingencies pursuant to environmental laws and regulations that in the future may require the company to take further actionto correct the effects on the environment of prior disposal practices or releases of chemical or petroleum substances by the company or other parties. Thecompany accrues for environmental remediation activities consistent with the policy set forth in Note 1. Much of this liability results from the ComprehensiveEnvironmental Response, Compensation and Liability Act (CERCLA, often referred to as Superfund), RCRA and similar state and global laws. These lawsrequire the company to undertake certain investigative, remediation and restoration activities at sites where the company conducts or once conducted operationsor at sites where company-generated waste was disposed. The accrual also includes estimated costs related to a number of sites identified by the company forwhich it is probable that environmental remediation will be required, but which are not currently the subject of enforcement activities.Remediation activities vary substantially in duration and cost from site to site. These activities, and their associated costs, depend on the mix of unique sitecharacteristics, evolving remediation technologies, diverse regulatory agencies and enforcement policies, as well as the presence or absence of potentiallyresponsible parties. At December 31, 2012, the Consolidated Balance Sheet included a liability of $436, relating to these matters and, in management'sopinion, is appropriate based on existing facts and circumstances. The average time frame, over which the accrued or presently unrecognized amounts may bepaid, based on past history, is estimated to be 15-20 years. Considerable uncertainty exists with respect to these costs and, under adverse changes incircumstances, potential liability may range up to three times the amount accrued as of December 31, 2012. 17. STOCKHOLDERS' EQUITYShare Repurchase ProgramDuring 2012, the company purchased and retired 7.8 million shares at a total cost of $400. These purchases completed the 2001 $2,000 share buyback planand began purchases under a $2,000 share buyback plan authorized by the company's Board of Directors in April 2011. Under the completed 2001 plan, thecompany purchased a total of 42.0 million shares. As of December 31, 2012, the company has purchased 5.5 million shares at a total cost of $284 under the2011 plan. There is no required completion date for the purchases under the 2011 plan.In December 2012, the company's Board of Directors authorized a $1,000 share buyback plan, subject to receiving the proceeds from the PerformanceCoatings divestiture. On February 1, 2013, the sale of Performance Coating was completed. The 2012 share buyback plan is expected to be completed in thefirst half 2013.Common stock held in treasury is recorded at cost. When retired, the excess of the cost of treasury stock over its par value is allocated between reinvestedearnings and additional paid-in capital.Set forth below is a reconciliation of common stock share activity for the years ended December 31, 2012, 2011 and 2010:Shares of common stockIssuedHeld In TreasuryBalance January 1, 2010990,855,000(87,041,000)Issued18,891,000—Repurchased—(5,395,000)Retired(5,395,000)5,395,000Balance December 31, 20101,004,351,000(87,041,000)Issued22,650,000—Repurchased—(13,837,000)Retired(13,837,000)13,837,000Balance December 31, 20111,013,164,000(87,041,000)Issued14,671,000—Repurchased—(7,778,000)Retired(7,778,000)7,778,000Balance December 31, 20121,020,057,000(87,041,000)F-28E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Noncontrolling InterestIn May 2012, the company completed the acquisition of the remaining 28 percent interest in the Solae, LLC joint venture from Bunge Limited for $447. As thepurchase of the remaining interest did not result in a change of control, the difference between the carrying value of the noncontrolling interest of $362 and theconsideration paid, net of taxes of $74, was recorded as an $11 reduction to additional paid-in capital.Other Comprehensive IncomeA summary of the pre-tax, tax, and after-tax effects of the components of other comprehensive income for the year ended December 31, 2012, 2011, and 2010is provided as follows:For the year ended December 31,201220112010 Pre-TaxTaxAfter-TaxPre-TaxTaxAfter-TaxPre-TaxTaxAfter-TaxCumulative translation adjustment$77$—$77$(457)$—$(457)$(6)$—$(6)Net revaluation and clearance of cash flow hedges to earnings:Additions and revaluations of derivatives designated as cash flowhedges8(6)210(5)5(33)14(19)Clearance of hedge results to earnings(65)28(37)96(36)6090(34)56Net revaluation and clearance of cash flow hedges to earnings(57)22(35)106(41)6557(20)37Pension benefit plans:Net loss(1,433)437(996)(4,069)1,402(2,667)(635)224(411)Prior service benefit (cost)22(8)14(2)—(2)———Amortization of prior service cost13(4)916(5)1116(5)11Amortization of loss887(305)582613(210)403507(173)334Curtailment / settlement loss7(2)5——————Pension benefit plans, net(504)118(386)(3,442)1,187(2,255)(112)46(66)Other benefit plans:Net loss(60)17(43)(437)151(286)(94)31(63)Prior service benefit (cost)857(299)558(11)4(7)189(77)112Amortization of prior service benefit(155)54(101)(121)43(78)(106)37(69)Amortization of loss94(33)6160(21)3958(21)37Curtailment loss3(1)2——————Other benefit plans, net739(262)477(509)177(332)47(30)17Net unrealized gain (loss) on securities:Unrealized (loss) gain on securities arising during the period(5)2(3)2(1)1(3)1(2)Reclassification of loss realized in net income3(1)2———5(2)3Net unrealized (loss) gain on securities(2)1(1)2(1)12(1)1Other comprehensive income (loss)$253$(121)$132$(4,300)$1,322$(2,978)$(12)$(5)$(17)Tax (expense) benefit recorded in Stockholders' Equity was $(70), $1,365 and $12 for the years 2012, 2011 and 2010, respectively. Included in theseamounts were tax benefits of $51, $43 and $17 for the years 2012, 2011 and 2010, respectively, associated with stock compensation programs. Theremainder consists of amounts recorded within other comprehensive income (loss) as shown in the table above.F-29E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)The changes and after-tax balances of components comprising accumulated other comprehensive income (loss) are summarized below: Cumulative TranslationAdjustmentNet Revaluation andClearance of Cash FlowHedges to EarningsPension Benefit PlansOther Benefit PlansUnrealized Gain (Loss) onSecuritiesTotal2010 Balance January 1, 2010$219$(65)$(5,967)$41$1$(5,771)Other comprehensive income (loss)attributable to DuPont(6)34(65)171(19)Balance December 31, 2010$213$(31)$(6,032)$58$2$(5,790)2011 Other comprehensive income (loss)attributable to DuPont(457)72(2,244)(332)1(2,960)Balance December 31, 2011$(244)$41$(8,276)$(274)$3$(8,750)2012 Other comprehensive income (loss)attributable to DuPont77(38)(410)476(1)104Balance December 31, 2012$(167)$3$(8,686)$202$2$(8,646)18. LONG-TERM EMPLOYEE BENEFITSThe company offers various long-term benefits to its employees. Where permitted by applicable law, the company reserves the right to change, modify ordiscontinue the plans.Defined Benefit PensionsThe company has both funded and unfunded noncontributory defined benefit pension plans covering a majority of the U.S. employees hired prior to January1, 2007. The benefits under these plans are based primarily on years of service and employees' pay near retirement. The company's funding policy isconsistent with the funding requirements of federal laws and regulations. Pension coverage for employees of the company's non-U.S. consolidated subsidiariesis provided, to the extent deemed appropriate, through separate plans. Obligations under such plans are funded by depositing funds with trustees, covered byinsurance contracts, or remain unfunded.Other Long-term Employee BenefitsThe parent company and certain subsidiaries provide medical, dental and life insurance benefits to pensioners and survivors, and disability and lifeinsurance protection to employees. The associated plans for retiree benefits are unfunded and the cost of the approved claims is paid from company funds.Essentially all of the cost and liabilities for these retiree benefit plans are attributable to the U.S. parent company plans. The non-Medicare eligible retireemedical plan is contributory with pensioners and survivors' contributions adjusted annually to achieve a 50/50 target sharing of cost increases between thecompany and pensioners and survivors. In addition, limits are applied to the company's portion of the retiree medical cost coverage. Beginning in 2013, thecompany is providing the Medicare eligible pensioners and survivors with a company-funded Health Reimbursement Arrangement (HRA). The majority ofU.S. employees hired on or after January 1, 2007 are not eligible to participate in the post retirement medical, dental and life insurance plans.Employee life insurance and disability benefit plans are insured in many countries. However, primarily in the U.S., such plans are generally self-insured orare fully experience-rated. Obligations and expenses for self-insured and fully experience-rated plans are reflected in the figures below.F-30E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Summarized information on the company's pension and other long-term employee benefit plans is as follows: Pension BenefitsOther BenefitsObligations and Funded Status at December 31,2012201120122011Change in benefit obligation Benefit obligation at beginning of year$27,083 $23,924 $4,379 $3,989 Service cost277 249 37 33 Interest cost1,165 1,253 174 212 Plan participants' contributions24 21 110 112 Actuarial loss2,245 3,062 60 441 Benefits paid(1,593) (1,610) (371) (424) Amendments(22) 2 (857)1 11 Net effects of acquisitions/divestitures— 182 — 5 Benefit obligation at end of year$29,179 $27,083 $3,532 $4,379 Change in plan assets Fair value of plan assets at beginning of year$17,794 $18,403 $— $— Actual gain on plan assets2,326 471 — — Employer contributions848 341 261 312 Plan participants' contributions24 21 110 112 Benefits paid(1,593) (1,610) (371) (424) Net effects of acquisitions/divestitures— 168 — — Fair value of plan assets at end of year$19,399 $17,794 $— $— Funded status U.S. plans with plan assets$(6,625) $(6,894) $— $— Non-U.S. plans with plan assets(1,443) (901) — — All other plans(1,712)2 (1,494)2 (3,532) (4,379) Total$(9,780) $(9,289) $(3,532) $(4,379) Amounts recognized in the Consolidated Balance Sheets consist of: Other assets$5 $4 $— $— Other accrued liabilities (Note 13)(110) (107) (257) (316) Other liabilities (Note 15)(9,303) (9,186) (3,271) (4,063) Liabilities related to assets held for sale(372) — (4) — Net amount recognized$(9,780) $(9,289) $(3,532) $(4,379) 1. Due to an amendment in 2012 to the company's U.S. parent company retiree medical and dental plans for Medicare eligible pensioners and survivors from the company sponsoredgroup plans to a company-funded Health Reimbursement Arrangement (HRA), the benefit obligation decreased by $838 and prior service cost was credited by $838.2. Includes pension plans maintained around the world where funding is not customary.F-31E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)The pre-tax amounts recognized in accumulated other comprehensive loss are summarized below: Pension BenefitsOther BenefitsDecember 31,2012201120122011Net loss$(13,042)$(12,477)$(1,233)$(1,266)Prior service (cost) benefit(62)(99)1,567862 $(13,104)$(12,576)$334$(404)The accumulated benefit obligation for all pension plans was $27,243 and $25,116 at December 31, 2012 and 2011, respectively.Information for pension plans with projected benefit obligation in excess of plan assets20122011Projected benefit obligation$29,043$27,002Accumulated benefit obligation27,13025,049Fair value of plan assets19,25817,710Information for pension plans with accumulated benefit obligations in excess of plan assets20122011Projected benefit obligation$28,925$25,810Accumulated benefit obligation27,06423,974Fair value of plan assets19,17916,576 Pension BenefitsComponents of net periodic benefit cost (credit) and amounts recognized in other comprehensive income201220112010Net periodic benefit cost Service cost$277$249$207Interest cost1,1651,2531,262Expected return on plan assets(1,517)(1,475)(1,435)Amortization of loss887613507Amortization of prior service cost131616Curtailment / settlement loss7——Net periodic benefit cost1$832$656$557Changes in plan assets and benefit obligations recognized in other comprehensive income Net loss$1,433$4,069$635Amortization of loss(887)(613)(507)Prior service (benefit) cost(22)2—Amortization of prior service cost(13)(16)(16)Curtailment / settlement loss(7)——Total loss recognized in other comprehensive income$504$3,442$112Noncontrolling interest(1)(11)(1)Accumulated other comprehensive income assumed from purchase of noncontrolling interest25——Total loss recognized in other comprehensive income, attributable to DuPont$528$3,431$111Total recognized in net periodic benefit cost and other comprehensive income$1,360$4,087$6681. The above amounts include net periodic benefit cost relating to discontinued operations for 2012, 2011 and 2010 of $42, $41 and $38, respectively.F-32E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)The estimated pre-tax net loss and prior service cost for the defined benefit pension plans that will be amortized from accumulated other comprehensive lossinto net periodic benefit cost during 2013 are $972 and $12, respectively. Other BenefitsComponents of net periodic benefit cost (credit) and amounts recognized in other comprehensive income201220112010Net periodic benefit cost Service cost$37$33$29Interest cost174212238Amortization of loss946058Amortization of prior service benefit(155)(121)(106)Curtailment loss3——Net periodic benefit cost1$153$184$219Changes in plan assets and benefit obligations recognized in other comprehensive income Net loss$60$437$94Amortization of loss(94)(60)(58)Prior service (benefit) cost(857)11(189)Amortization of prior service benefit155121106Curtailment loss(3)——Total (benefit) loss recognized in other comprehensive income$(739)$509$(47)Accumulated other comprehensive income assumed from purchase of noncontrolling interest1——Total (benefit) loss recognized in other comprehensive income, attributable to DuPont$(738)$509$(47)Total recognized in net periodic benefit cost and other comprehensive income$(585)$693$1721. The above amounts include net periodic benefit cost relating to discontinued operations for 2012, 2011 and 2010 of $2, $2 and $1, respectively.The estimated pre-tax net loss and prior service credit for the other long-term employee benefit plans that will be amortized from accumulated othercomprehensive loss into net periodic benefit cost during 2013 are $107 and $(187), respectively. Pension BenefitsOther BenefitsWeighted-average assumptions used to determine benefit obligations at December 31,2012201120122011Discount rate3.89%4.49%3.85%4.50%Rate of compensation increase14.13%4.18%4.40%4.40%1. The rate of compensation increase represents the single annual effective salary increase that an average plan participant would receive during the participant's entire career at thecompany. Pension BenefitsOther BenefitsWeighted-average assumptions used to determine net periodic benefit cost for the years ended December 31,201220112010201220112010Discount rate4.32%5.32%5.80%4.49%5.50%6.00%Expected return on plan assets8.61%8.73%8.64%—%—%—%Rate of compensation increase4.18%4.24%4.24%4.40%4.50%4.50%In connection with the planned sale of the Performance Coatings business (See Note 2), the company updated the discount rate and expected return on planassets for the U.S. pension plans during 2012. For determining the U.S. pension plans' net periodic benefit costs, the weighted discount rate, weightedexpected return on plan assets and the rate of compensation increase were 4.38 percent, 8.96 percent and 4.40 percent for 2012. With the continuing challengesin the global economy, the company lowered its long-term expected return on plan assets during 2012.F-33E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)For determining U.S. pension plans' net periodic benefit costs, the discount rate, expected return on plan assets and the rate of compensation increase were5.50 percent, 9.00 percent and 4.50 percent for 2011 and 6.00 percent, 9.00 percent and 4.50 percent for 2010, respectively.In the U.S., the discount rate is developed by matching the expected cash flow of the benefit plans to a yield curve constructed from a portfolio of high qualityfixed-income instruments provided by the plan's actuary as of the measurement date. For non-U.S. benefit plans, the company utilizes prevailing long-termhigh quality corporate bond indices to determine the discount rate applicable to each country at the measurement date.The long-term rate of return on assets in the U.S. was selected from within the reasonable range of rates determined by historical real returns (net of inflation)for the asset classes covered by the investment policy, expected performance, and projections of inflation over the long-term period during which benefits arepayable to plan participants. Consistent with prior years, the long-term rate of return on plan assets in the U.S. reflects the asset allocation of the plan and theeffect of the company's active management of the plans' assets. For non-U.S. plans, assumptions reflect economic assumptions applicable to each country.Assumed health care cost trend rates at December 31,20122011Health care cost trend rate assumed for next year8%8%Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)5%5%Year that the rate reaches the ultimate trend rate20162015Assumed health care cost trend rates have a modest effect on the amount reported for the health care plan. A one-percentage point change in assumed health carecost trend rates would have the following effects: 1-PercentagePoint Increase1-PercentagePoint DecreaseIncrease (decrease) on total of service and interest cost$5$(5)Increase (decrease) on post-retirement benefit obligation75(86)F-34E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Plan AssetsAll pension plan assets in the U.S. are invested through a single master trust fund. The strategic asset allocation for this trust fund is selected by management,reflecting the results of comprehensive asset liability modeling. The general principles guiding U.S. pension asset investment policies are those embodied in theEmployee Retirement Income Security Act of 1974 (ERISA). These principles include discharging the company's investment responsibilities for the exclusivebenefit of plan participants and in accordance with the "prudent expert" standard and other ERISA rules and regulations. The company establishes strategicasset allocation percentage targets and appropriate benchmarks for significant asset classes with the aim of achieving a prudent balance between return andrisk. Strategic asset allocations in other countries are selected in accordance with the laws and practices of those countries. Where appropriate, asset liabilitystudies are utilized in this process. U.S. plan assets and a portion of non-U.S. plan assets are managed by investment professionals employed by thecompany. The remaining assets are managed by professional investment firms unrelated to the company. The company's pension investment professionalshave discretion to manage the assets within established asset allocation ranges approved by senior management of the company. Additionally, pension trustfunds are permitted to enter into certain contractual arrangements generally described as "derivatives." Derivatives are primarily used to reduce specific marketrisks, hedge currency and adjust portfolio duration and asset allocation in a cost-effective manner.The weighted-average target allocation for plan assets of the company's U.S. and non-U.S. pension plan is summarized as follows:Target allocation for plan assets at December 31,20122011U.S. equity securities28%27%Non-U.S. equity securities2120Fixed income securities2929Hedge funds22Private market securities1314Real estate78Total100%100%Equity securities include varying market capitalization levels. U.S. equity investments are primarily large-cap companies. Fixed income investments includecorporate-issued, government-issued and asset-backed securities. Corporate debt investments include a range of credit risk and industry diversification. U.S.fixed income investments are weighted heavier than non-U.S fixed income securities. Other investments include hedge funds, real estate and private marketsecurities such as interests in private equity and venture capital partnerships.Fair value calculations may not be indicative of net realizable value or reflective of future fair values. Furthermore, although the company believes its valuationmethods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certainfinancial instruments could result in a different fair value measurement at the reporting date.F-35E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)The tables below presents the fair values of the company's pension assets by level within the fair value hierarchy, as described in Note 1, as of December 31,2012 and 2011, respectively. Fair Value Measurements at December 31, 2012Asset CategoryTotalLevel 1Level 2Level 3Cash and cash equivalents$2,613$2,584$29$—U.S. equity securities13,6473,6042518Non-U.S. equity securities3,9283,84286—Debt – government-issued1,7144431,271—Debt – corporate-issued2,2363781,83127Debt – asset-backed1,059401,0172Hedge funds389—2387Private market securities2,926—42,922Real estate1,23682—1,154Derivatives – asset position1296123—Derivatives – liability position(80)(1)(79)— $19,797$10,978$4,309$4,510Pension trust receivables2312 Pension trust payables3(710) Total$19,399 Fair Value Measurements at December 31, 2011Asset CategoryTotalLevel 1Level 2Level 3Cash and cash equivalents$2,085$1,962$123$—U.S. equity securities13,6243,5762028Non-U.S. equity securities3,2273,16661—Debt – government-issued1,5963911,205—Debt – corporate-issued1,8441141,70030Debt – asset-backed963369234Hedge funds396—4392Private market securities2,959——2,959Real estate1,196109—1,087Derivatives – asset position1274123—Derivatives – liability position(90)(2)(88)— $17,927$9,356$4,071$4,500Pension trust receivables2463 Pension trust payables3(596) Total$17,794 1. The company's pension plans directly held $449 (2 percent of total plan assets) and $457 (3 percent of total plan assets) of DuPont common stock at December 31, 2012 and 2011,respectively.2. Primarily receivables for investment securities sold.3. Primarily payables for investment securities purchased.F-36E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)The company's pension plans hold Level 3 assets which are primarily ownership interests in investment partnerships and trusts that own private marketsecurities and real estate. Fair value is generally based on the company's units of ownership and net asset value of the investment entity or the company's shareof the investment entity's total equity. The table below presents a rollforward of activity for these assets for the years ended December 31, 2012 and 2011: Level 3 Assets TotalU.S. EquitySecuritiesDebt-CorporateIssuedDebt-Asset-BackedHedge FundsPrivateMarketSecuritiesRealEstateBeginning balance at December 31, 2010$3,920$20$34$4$—$2,931$931Realized gain (loss)11—(10)——21—Change in unrealized gain (loss)201(3)9—(9)12480Purchases, sales and settlements375105—401(117)76Transfers (out) in of Level 3(7)1(8)————Ending balance at December 31, 2011$4,500$28$30$4$392$2,959$1,087Realized gain (loss)14(3)——(6)23—Change in unrealized gain (loss)253(8)(10)—1717975Purchases, sales and settlements(134)(1)7(2)(16)(114)(8)Transfers (out) in of Level 3(123)2———(125)—Ending balance at December 31, 2012$4,510$18$27$2$387$2,922$1,154Cash FlowContributionsThe company made a contribution of $500 to its principal U.S. pension plan in 2010 and made another $500 contribution in 2012. No contributions wererequired or made to the principal U.S. pension plan trust fund in 2011. No contributions are expected to be made to the principal U.S. pension plan in 2013.The company expects to contribute approximately $340 in 2013 to its pension plans other than the principal U.S. pension plan and also expects to make cashpayments of approximately $260 in 2013 under its other long-term employee benefit plans.Estimated Future Benefit PaymentsThe following benefit payments, which reflect future service, as appropriate, are expected to be paid: PensionBenefitsOther Benefits2013$1,629$26020141,60425420151,62925220161,63725020171,667246Years 2018-20228,6781,178Defined Contribution PlanThe company sponsors several defined contribution plans, which cover substantially all U.S. employees. The most significant is the U.S. parent company'sRetirement Savings Plan (the Plan), which reflects the 2009 merger of the Retirement Savings Plan and the Savings and Investment Plan. This Plan includes anon-leveraged Employee Stock Ownership Plan (ESOP). Employees are not required to participate in the ESOP and those who do are free to diversify out of theESOP. The purpose of the Plan is to provide retirement savings benefits for employees and to provide employees an opportunity to become stockholders of thecompany. The Plan is a tax qualified contributory profit sharing plan, with cash or deferred arrangement and any eligible employee of the company mayparticipate. The company contributes 100 percent of the first 6 percent of the employee's contribution election and also contributes 3 percent of each eligibleemployee's eligible compensation regardless of the employee's contribution.F-37E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)The company's contributions to the U.S. parent company's defined contribution plans were $212, $210 and $195 for the years ended December 31, 2012,2011 and 2010, respectively. The company's matching contributions vest immediately upon contribution. The 3 percent nonmatching company contributionvests for employees with at least three years of service. In addition, the company made contributions to other defined contribution plans of $124, $84 and$59 for the years ended December 31, 2012, 2011 and 2010, respectively. Included in the company's contributions are amounts related to discontinuedoperations of $30, $29 and $32 for the years ended December 31, 2012, 2011 and 2010, respectively. The company expects to contribute about $320 to itsdefined contribution plans in 2013.19. COMPENSATION PLANSThe total stock-based compensation cost included in the Consolidated Income Statements was $105, $113 and $108 for 2012, 2011 and 2010, respectively.The income tax benefits related to stock-based compensation arrangements were $35, $37 and $36 for 2012, 2011 and 2010, respectively.In April 2011, the shareholders approved amendments to the DuPont Equity and Incentive Plan (EIP). The EIP provides for equity-based and cash incentiveawards to certain employees, directors, and consultants. Under the amended EIP, the maximum number of shares reserved for the grant or settlement ofawards is 110 million shares, provided that each share in excess of 30 million that is issued with respect to any award that is not an option or stockappreciation right will be counted against the 110 million share limit as four and one-half shares. At December 31, 2012, approximately 60 million shares wereauthorized for future grants under the company's EIP. The company satisfies stock option exercises and vesting of time-vested restricted stock units (RSUs)and performance-based restricted stock units (PSUs) with newly issued shares of DuPont common stock.The company's Compensation Committee determines the long-term incentive mix, including stock options, RSUs and PSUs and may authorize new grantsannually.Stock OptionsThe exercise price of shares subject to option is equal to the market price of the company's stock on the date of grant. Options granted prior to 2004 expire10 years from date of grant; options granted between 2004 and 2008 serially vested over a three-year period and carry a six-year option term. Stock optionawards granted between 2009 and 2012 expire seven years after the grant date. The plan allows retirement eligible employees to retain any granted awards uponretirement provided the employee has rendered at least six months of service following grant date.For purposes of determining the fair value of stock options awards, the company uses the Black-Scholes option pricing model and the assumptions set forthin the table below. The weighted-average grant-date fair value of options granted in 2012, 2011 and 2010 was $11.81, $12.32 and $6.44, respectively. 201220112010Dividend yield3.2%3.2%4.9%Volatility34.87%33.26%32.44%Risk-free interest rate0.9%2.3%2.6%Expected life (years)5.35.35.3The company determines the dividend yield by dividing the current annual dividend on the company's stock by the option exercise price. A historical dailymeasurement of volatility is determined based on the expected life of the option granted. The risk-free interest rate is determined by reference to the yield on anoutstanding U.S. Treasury note with a term equal to the expected life of the option granted. Expected life is determined by reference to the company's historicalexperience.F-38E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Stock option awards as of December 31, 2012, and changes during the year then ended were as follows: Number ofShares(in thousands)WeightedAverageExercise Price(per share)WeightedAverageRemainingContractualTerm (years)AggregateIntrinsicValue(in thousands)Outstanding, December 31, 201145,046$38.40 Granted4,728$51.77 Exercised(12,995)$38.21 Forfeited(135)$46.92 Cancelled(3,285)$44.57 Outstanding, December 31, 201233,359$39.703.03$258,455Exercisable, December 31, 201224,254$36.682.15$235,063The aggregate intrinsic values in the table above represent the total pre-tax intrinsic value (the difference between the company's closing stock price on the lasttrading day of 2012 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had alloption holders exercised their in-the-money options at year end. The amount changes based on the fair market value of the company's stock. Total intrinsicvalue of options exercised for 2012, 2011 and 2010 were $147, $216 and $109, respectively. In 2012, the company realized a tax benefit of $49 from optionsexercised.As of December 31, 2012, $29 of total unrecognized compensation cost related to stock options is expected to be recognized over a weighted-average period of1.87 years.RSUs and PSUsThe company issues RSUs that serially vest over a three-year period and, upon vesting, convert one-for-one to DuPont common stock. A retirement eligibleemployee retains any granted awards upon retirement provided the employee has rendered at least six months of service following the grant date. AdditionalRSUs are also granted periodically to key senior management employees. These RSUs generally vest over periods ranging from two to five years. The fairvalue of all stock-settled RSUs is based upon the market price of the underlying common stock as of the grant date.The company also grants PSUs to senior leadership. In 2012, there were 233,422 PSUs granted. Vesting for PSUs granted in 2010, 2011 and 2012 is equallybased upon corporate revenue growth relative to peer companies and total shareholder return (TSR) relative to peer companies. Performance and payouts aredetermined independently for each metric. The actual award, delivered as DuPont common stock, can range from zero percent to 200 percent of the originalgrant. The grant-date fair value of the PSUs granted in 2012, subject to the TSR metric, was $69.77, estimated using a Monte Carlo simulation. The grant-date fair value of the PSUs, subject to the revenue metric, was based upon the market price of the underlying common stock as of the grant date.Non-vested awards of RSUs and PSUs as of December 31, 2012 and 2011 are shown below. The weighted-average grant-date fair value of RSUs and PSUsgranted during 2012, 2011 and 2010 was $47.17, $53.19 and $34.60, respectively. Number ofShares(in thousands)WeightedAverageGrant DateFair Value(per share)Nonvested, December 31, 20113,581$38.58Granted1,872$47.17Vested(2,240)$30.42Forfeited(93)$43.07Nonvested, December 31, 20123,120$49.42As of December 31, 2012, there was $52 unrecognized stock-based compensation expense related to nonvested awards. That cost is expected to be recognizedover a weighted-average period of 1.83 years. The total fair value of stock units vested during 2012, 2011 and 2010 was $68, $74 and $64, respectively.F-39E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Other Cash-based AwardsCash awards under the EIP plan may be granted to employees who have contributed most to the company's success, with consideration being given to theability to succeed to more important managerial responsibility. Such awards were $60, $85 and $112 for 2012, 2011 and 2010, respectively. The amounts ofthe awards are dependent on company earnings and are subject to maximum limits as defined under the governing plans.In addition, the company has other variable compensation plans under which cash awards may be granted. These plans include the company's regional andlocal variable compensation plans and Pioneer's Annual Reward Program. Such awards were $379, $386 and $422 for 2012, 2011 and 2010, respectively.20. DERIVATIVES AND OTHER HEDGING INSTRUMENTSObjectives and Strategies for Holding Derivative InstrumentsIn the ordinary course of business, the company enters into contractual arrangements (derivatives) to reduce its exposure to foreign currency, interest rate andcommodity price risks. The company has established a variety of derivative programs to be utilized for financial risk management. These programs reflectvarying levels of exposure coverage and time horizons based on an assessment of risk.Derivative programs have procedures and controls and are approved by the Corporate Financial Risk Management Committee, consistent with the company'sfinancial risk management policies and guidelines. Derivative instruments used are forwards, options, futures and swaps. The company has not designatedany nonderivatives as hedging instruments. The company's financial risk management procedures also address counterparty credit approval, limits and routine exposure monitoring and reporting. Thecounterparties to these contractual arrangements are major financial institutions and major commodity exchanges. The company is exposed to credit loss in theevent of nonperformance by these counterparties. The company utilizes collateral support annex agreements with certain counterparties to limit its exposure tocredit losses. The company's derivative assets and liabilities are reported on a gross basis in the Consolidated Balance Sheets. The company anticipatesperformance by counterparties to these contracts and therefore no material loss is expected. Market and counterparty credit risks associated with theseinstruments are regularly reported to management.The notional amounts of the company's derivative instruments were as follows:December 31,20122011Derivatives designated as hedging instruments: Interest rate swaps$1,000$1,000Foreign currency contracts1,0832,032Commodity contracts753553Derivatives not designated as hedging instruments: Foreign currency contracts6,7336,444Commodity contracts242437Foreign Currency RiskThe company's objective in managing exposure to foreign currency fluctuations is to reduce earnings and cash flow volatility associated with foreign currencyrate changes. Accordingly, the company enters into various contracts that change in value as foreign exchange rates change to protect the value of its existingforeign currency-denominated assets, liabilities, commitments and cash flows.The company routinely uses forward exchange contracts to offset its net exposures, by currency, related to the foreign currency-denominated monetary assetsand liabilities of its operations. The primary business objective of this hedging program is to maintain an approximately balanced position in foreigncurrencies so that exchange gains and losses resulting from exchange rate changes, net of related tax effects, are minimized. The company also uses foreigncurrency exchange contracts to offset a portion of the company's exposure to certain foreign currency-denominated revenues so that gains and losses on thesecontracts offset changes in the USD value of the related foreign currency-denominated revenues. The objective of the hedge program is to reduce earnings andcash flow volatility related to changes in foreign currency exchange rates.F-40E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Interest Rate RiskThe company uses interest rate swaps to manage the interest rate mix of the total debt portfolio and related overall cost of borrowing.Interest rate swaps involve the exchange of fixed for floating rate interest payments to effectively convert fixed rate debt into floating rate debt based on USDLIBOR. Interest rate swaps allow the company to achieve a target range of floating rate debt.Commodity Price RiskCommodity price risk management programs serve to reduce exposure to price fluctuations on purchases of inventory such as copper, corn, soybeans andsoybean meal. The company enters into over-the-counter and exchange-traded derivative commodity instruments to hedge the commodity price risk associatedwith energy feedstock and agricultural commodity exposures.Fair Value HedgesInterest Rate SwapsAt December 31, 2012, the company maintained a number of interest rate swaps, which were implemented at the time debt instruments were issued. Allinterest rate swaps qualify for the shortcut method of hedge accounting, thus there is no ineffectiveness related to these hedges.Cash Flow HedgesForeign Currency ContractsThe company uses foreign currency exchange instruments such as forwards and options to offset a portion of the company's exposure to certain foreigncurrency-denominated revenues so that gains and losses on these contracts offset changes in the USD value of the related foreign currency-denominatedrevenues.Commodity ContractsThe company enters into over-the-counter and exchange-traded derivative commodity instruments, including options, futures and swaps, to hedge thecommodity price risk associated with energy feedstock and agriculture commodity exposures.Treasury Rate ContractsDuring 2010, the company entered into treasury rate contracts to hedge the company's exposure to treasury rates on a portion of planned bond issuances. Thecontracts were terminated at the time the bonds were issued prior to year end.While each risk management program has a different time maturity period, most programs currently do not extend beyond the next two-year period. Cash flowhedge results are reclassified into earnings during the same period in which the related exposure impacts earnings. Reclassifications are made sooner if itappears that a forecasted transaction will not materialize. The following table summarizes the after-tax effect of cash flow hedges on accumulated othercomprehensive income (loss) for the years ended December 31, 2012 and 2011:December 31,20122011Beginning balance$41$(31)Additions and revaluations of derivatives designated as cash flow hedges(1)12Clearance of hedge results to earnings(37)60Ending balance$3$41During the next 12 months, the after-tax amount expected to be reclassified from accumulated other comprehensive income (loss) into earnings is $9.F-41E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Derivatives not Designated in Hedging RelationshipsForeign Currency ContractsThe company routinely uses forward exchange contracts to reduce its net exposure, by currency, related to foreign currency-denominated monetary assets andliabilities of its operations so that exchange gains and losses resulting from exchange rate changes are minimized. The netting of such exposures precludes theuse of hedge accounting; however, the required revaluation of the forward contracts and the associated foreign currency-denominated monetary assets andliabilities intends to achieve a minimal earnings impact, after taxes. Additionally, the company has cross-currency swaps to hedge foreign currencyfluctuations on long-term intercompany loans.In 2012, the company initiated a program to utilize forward exchange contracts to reduce the net exposure related to foreign currency-denominated monetaryassets and liabilities of its discontinued operations.Commodity ContractsThe company utilizes options, futures and swaps that are not designated as hedging instruments to reduce exposure to commodity price fluctuations onpurchases of inventory such as corn, soybeans and soybean meal.Fair Values of Derivative InstrumentsThe table below presents the fair values of the company's derivative assets and liabilities within the fair value hierarchy, as described in Note 1, as ofDecember 31, 2012 and 2011. Fair Value at December 31Using Level 2 Inputs Balance Sheet Location20122011Asset derivatives: Derivatives designated as hedging instruments: Interest rate swaps1Other assets$55$66Foreign currency contractsAccounts and notes receivable, net744 62110Derivatives not designated as hedging instruments: Foreign currency contracts1Accounts and notes receivable, net88100Foreign currency contractsOther assets—43 88143Total asset derivatives $150$253Cash collateral1Other accrued liabilities$44$— Liability derivatives: Derivatives designated as hedging instruments: Foreign currency contractsOther accrued liabilities$10$12Commodity contractsOther accrued liabilities—1 1013Derivatives not designated as hedging instruments: Foreign currency contractsOther accrued liabilities7621Commodity contractsOther accrued liabilities12 7723Total liability derivatives $87$361. Cash collateral held as of December 31, 2012 represents $13 related to interest rate swap derivatives designated as hedging instruments and $31 related to foreign currencyderivatives not designated as hedging instruments. No cash collateral was held as of December 31, 2011.F-42E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Effect of Derivative Instruments Amount of Gain (Loss)Recognized in OCI1(Effective Portion)Amount of Gain (Loss)Recognized in Income2 201220112010201220112010Income Statement ClassificationDerivatives designated as hedging instruments: Fair value hedges: Interest rate swaps$—$—$—$(11)$26$40Interest expense3Cash flow hedges: Foreign currency contracts(2)(6)221(15)(1)Net salesCommodity contracts723(35)44(81)(89)COGS4Treasury rate contracts——(3)——— 517(36)54(70)(50) Derivatives not designated as hedging instruments: Foreign currency contracts———(157)(133)117Other income, net5Commodity contracts———(22)3(18)COGS4Interest rate swaps————(1)—COGS4 ———(179)(131)99 Total derivatives$5$17$(36)$(125)$(201)$49 1. OCI is defined as other comprehensive income (loss).2. For cash flow hedges, this represents the effective portion of the gain (loss) reclassified from accumulated OCI into income during the period. For the years ended December 31,2012, 2011 and 2010, there was no material ineffectiveness with regard to the company's cash flow hedges.3. Gain (loss) recognized in income of derivative is offset to $0 by gain (loss) recognized in income of the hedged item.4. COGS is defined as costs of goods sold and other operating charges.5. Gain (loss) recognized in other income, net, was partially offset by the related gain (loss) on the foreign currency-denominated monetary assets and liabilities of the company'soperations, which were $(58), $(13) and $(128) for 2012, 2011 and 2010, respectively.F-43E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)21. GEOGRAPHIC INFORMATION 201220112010 Net Sales1Net Property2Net Sales1Net Property2Net Sales1Net Property2United States$13,279$8,512$12,234$8,668$10,539$7,835Canada$921$149$880$173$795$170EMEA3 Belgium$217$133$304$190$238$139Denmark953208332349—Finland8017065176432France765243774252557102Germany1,3101611,7363371,506289Italy764338243568836Luxembourg772527425065244Russia376735782347Spain326269390266320259The Netherlands312289277237221216United Kingdom54596493110415116Other3,1653302,7404182,120325Total EMEA$8,032$2,303$8,117$2,602$6,456$1,735Asia Pacific Australia$261$20$247$19$191$9China/Hong Kong2,9444232,9966282,479494India7481118159765181Japan1,5771011,7491061,436102Korea662616946459465Malaysia110539952912Singapore147551864217631Taiwan594135654133522129Thailand324263092423921Other666625996343249Total Asia Pacific$8,033$1,047$8,348$1,228$6,811$983Latin America Argentina$406$43$403$40$307$26Brazil2,3643482,0723941,568317Mexico1,046307972276731215Other731326553149358Total Latin America$4,547$730$4,102$741$3,099$616Total$34,812$12,741$33,681$13,412$27,700$11,3391. Net sales are attributed to countries based on the location of the customer.2. Includes property, plant and equipment less accumulated depreciation.3. Europe, Middle East, and Africa (EMEA).F-44E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)22. SEGMENT INFORMATIONThe company consists of 13 businesses which are aggregated into eight reportable segments based on similar economic characteristics, the nature of theproducts and production processes, end-use markets, channels of distribution and regulatory environment. The company's reportable segments areAgriculture, Electronics & Communications, Industrial Biosciences, Nutrition & Health, Performance Chemicals, Performance Materials, Safety &Protection and Pharmaceuticals. The company includes certain embryonic businesses not included in the reportable segments, such as pre-commercialprograms, and nonaligned businesses in Other.Major products by segment include: Agriculture (corn hybrids and soybean varieties, herbicides, fungicides and insecticides); Electronics &Communications (photopolymers and electronic materials); Industrial Biosciences (enzymes and bio-based materials); Nutrition & Health (cultures,emulsifiers, gums, natural sweeteners and soy-based food ingredients): Performance Chemicals (fluorochemicals, fluoropolymers, specialty and industrialchemicals, and white pigments); Performance Materials (engineering polymers, packaging and industrial polymers, films and elastomers); Safety &Protection (nonwovens, aramids and solid surfaces); and Pharmaceuticals (representing the company's interest in the collaboration relating toCozaar®/Hyzaar® antihypertensive drugs, which is reported as other income). The company operates globally in substantially all of its product lines.In general, the accounting policies of the segments are the same as those described in Note 1. Exceptions are noted as follows and are shown in thereconciliations below. Segment sales include transfers to another business segment. Products are transferred between segments on a basis intended to reflect, asnearly as practicable, the market value of the products. Segment pre-tax operating income (loss) (PTOI) is defined as income (loss) from continuing operationsbefore income taxes excluding exchange gains (losses), corporate expenses and interest. Segment net assets includes net working capital, net property, plant andequipment and other noncurrent operating assets and liabilities of the segment. Affiliate net assets (pro rata share) excludes borrowing and other long-termliabilities. Depreciation and amortization includes depreciation on research and development facilities and amortization of other intangible assets, excludingwrite-down of assets. Prior years' data have been reclassified to reflect the current organizational structure.F-45E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share) AgricultureElectronics &CommunicationsIndustrialBiosciencesNutrition & HealthPerformanceChemicalsPerformanceMaterialsSafety &ProtectionPharma-ceuticalsOtherTotal2012 Segment sales$10,426$2,701$1,180$3,422$7,188$6,447$3,825$—$5$35,194Less: Transfers51711—2479111——382Net sales10,4212,6841,1693,4226,9416,3563,814—534,812PTOI1,5941351682991,5861,01336062(385)4,832Depreciation and amortization33711379288245182197—11,442Equity in earnings of affiliates30191—284232—(53)99Segment net assets4,5391,5342,5716,5153,6633,5372,970(18)7325,384Affiliate net assets389151538180567106—141,468Purchases of property, plant and equipment4327180148389186118—71,4312011 Segment sales$9,166$3,173$705$2,460$7,794$6,815$3,934$—$40$34,087Less: Transfers1197—25710913——406Net sales9,1653,1546982,4607,5376,7063,921—4033,681PTOI1,527355(1)441,923971500289(263)5,345Depreciation and amortization2959947207252199172—21,273Equity in earnings of affiliates5819(3)—437447—(47)191Segment net assets4,7541,8672,5426,2253,5363,4683,055356925,551Affiliate net assets330197521201445111—341,371Purchases of property, plant and equipment42019861115326197208—51,5302010 Segment sales$7,845$2,764$—$1,240$6,322$6,287$3,364$—$194$28,016Less: Transfers117——2166912—1316Net sales7,8442,747—1,2406,1066,2183,352—19327,700PTOI1,293445—621,081994454489(205)4,613Depreciation and amortization26594—109266205151—41,094Equity in earnings of affiliates5926——247737—(45)178Segment net assets4,9031,639—9503,3103,5122,9554023317,542Affiliate net assets289195—2184485103—901,348Purchases of property, plant and equipment360260—39225190215—111,300F-46E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Reconciliation to Consolidated Financial StatementsPTOI to income from continuing operations before income taxes201220112010Total segment PTOI$4,832$5,345$4,613Net exchange losses, including affiliates(215)(146)(11)Corporate expenses and net interest(1,502)(1,418)(1,342)Income from continuing operations before income taxes$3,115$3,781$3,260 Segment net assets to total assets at December 31,201220112010Total segment net assets$25,384$25,551$17,542Corporate assets110,62510,08511,312Liabilities included in segment net assets10,6719,8828,524Assets related to discontinued operations23,0562,9743,032Total assets$49,736$48,492$40,4101. Pension assets are included in corporate assets.2. See Note 1 for additional information on the presentation of the Performance Coatings business which met the criteria for discontinued operations during 2012.Other items1SegmentTotalsAdjustmentsConsolidatedTotals2012 Depreciation and amortization$1,442$271$1,713Equity in earnings of affiliates993102Affiliate net assets1,468(305)1,163Purchases of property, plant and equipment1,4313621,7932011 Depreciation and amortization$1,273$287$1,560Equity in earnings of affiliates1911192Affiliate net assets1,371(254)1,117Purchases of property, plant and equipment1,5303131,8432010 Depreciation and amortization$1,094$286$1,380Equity in earnings of affiliates178(1)177Affiliate net assets1,348(307)1,041Purchases of property, plant and equipment1,3002081,5081. See Note 1 for additional information on the presentation of the Performance Coatings business which met the criteria for discontinued operations during 2012.F-47E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)Additional Segment Details2012 included the following pre-tax benefits (charges):Agriculture1,2,3$(469)Electronics & Communications3,4,5(37)Industrial Biosciences3(3)Nutrition & Health3(49)Performance Chemicals3,5(36)Performance Materials3,5(104)Safety & Protection3(58)Other3,6(126) $(882)1. Included a $(575) charge recorded in cost of goods sold and other operating charges associated with the company's process to fairly resolve claims related to the use of Imprelis®. SeeNote 16 for additional information.2. Included a $117 gain recorded in other income, net associated with the sale of a business.3. Included a $(134) restructuring charge recorded in employee separation/asset related charges, net primarily as a result of the company's plan to eliminate corporate costs previouslyallocated to Performance Coatings and cost-cutting actions to improve competitiveness, partially offset by a reversal of prior year restructuring accruals. Charges by segment were:Agriculture - $(11); Electronics & Communications - $(9); Industrial Biosciences - $(3); Nutrition & Health - $(49); Performance Chemicals - $(3); Performance Materials - $(12);Safety & Protection - $(58); and Other - $11. See Note 3 for additional information.4. Included a $122 gain recorded in other income, net associated with the sale of an equity method investment.5. Included a $(275) impairment charge recorded in employee separation/asset related charges, net related to asset groupings, which impacted the segments as follows: Electronics &Communications - $(150); Performance Chemicals - $(33); and Performance Materials - $(92). See Note 3 for additional information.6. Included a $(137) charge in cost of goods sold and other operating charges primarily related to the company's settlement of litigation with INVISTA.2011 included the following pre-tax benefits (charges):Agriculture1,2$(225)Industrial Biosciences3,4(79)Nutrition & Health3,4(126)Performance Materials4,547Other4(28) $(411)1. Included a $(50) charge recorded in research and development expense in connection with a milestone payment associated with a Pioneer licensing agreement. Since this milestone wasreached before regulatory approval was secured by Pioneer, it was charged to research and development expense.2. Included a $(175) charge recorded in cost of goods sold and other operating charges associated with the company's process to fairly resolve claims associated with the use of Imprelis®.See Note 16 for additional information.3. Included a $(182) charge for transaction related costs and the fair value step-up of inventories that were acquired as part of the Danisco transaction, which impacted the segmentsas follows: Industrial Biosciences - $(70) and Nutrition & Health - $(112).4. Included a $(53) restructuring charge primarily related to severance and related benefit costs associated with the Danisco acquisition impacting the segments as follows: IndustrialBiosciences - $(9); Nutrition & Health - $(14); Performance Materials - $(2); and Other - $(28). See Note 3 for additional information.5. Included a $49 benefit recorded in other income, net associated with the sale of a business.F-48E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)2010 included the following pre-tax benefits (charges):Agriculture1$(50)Electronics & Communications28Performance Chemicals210Performance Materials216Safety & Protection25Other21 $(10)1. Included a $(50) charge in research and development expense for an upfront payment related to a Pioneer licensing agreement. Since this payment was made before regulatoryapproval was secured by Pioneer, it was charged to research and development expense.2. Included a $40 reduction in estimated restructuring costs related to restructuring programs impacting the segments as follows: Electronics & Communications – $8; PerformanceChemicals – $10; Performance Materials – $16; Safety & Protection – $5; and Other – $1.F-49E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)23. QUARTERLY FINANCIAL DATAUnauditedFor the quarter ended March 31,June 30,September 30,December 31,2012 Net sales$10,180 $9,917 $7,390 $7,325 Cost of goods sold and other expenses18,2853 8,5813,4 7,3943,6,7 7,4713,6,7 Income (loss) from continuing operations beforeincome taxes1,795 1,5105 (174) (16)8 Net income1,500 1,188 13 112 Basic earnings (loss) per share of common stock from continuingoperations21.49 1.18 (0.05) 0.02 Diluted earnings (loss) per share of common stock from continuingoperations21.47 1.17 (0.05) 0.02 2011 Net sales$9,041 $9,159 $8,138 $7,343 Cost of goods sold and other expenses17,382 7,8159 7,73610,11,12 7,26212,13 Income from continuing operations before income taxes1,580 1,447 451 30314 Net income1,444 1,229 460 37714 Basic earnings per share of common stock from continuing operations21.45 1.20 0.39 0.31 Diluted earnings per share of common stock from continuingoperations21.43 1.18 0.39 0.31 1. Represents total expenses less interest expense.2. Earnings per share for the year may not equal the sum of quarterly earnings per share due to changes in average share calculations.3. First quarter, second quarter, third quarter, and fourth quarter 2012 included charges of $(50), $(265), $(125), and $(135), respectively, recorded in cost of goods sold and otheroperating charges associated with the company's process to fairly resolve claims related to the use of Imprelis®. See description in Note 16 for further details.4. Second quarter 2012 included a $(137) charge recorded in costs of goods sold and other operating charges primarily related to the company's settlement of litigation with INVISTA.See description in Note 16 for further details.5. Second quarter 2012 included a a pre-tax gain of $122 recorded in other income, net associated with the sale of an equity method investment in the Electronics & Communicationssegment.6. Third quarter 2012 included a $(152) restructuring charge recorded in employee separation / asset related charges, net related to the 2012 restructuring program. Fourth quarter2012 included a net $(66) charge recorded in employee separation / asset related charges, net related to costs associated with the 2012 restructuring program partially offset by areversal of prior years restructuring accruals. See description in Note 3 for further details.7. Third and fourth quarter 2012 included asset impairment charges of $(242) and $(33), respectively, recorded in employee separation / asset related charges, net related to certainasset groupings. See descriptions in Note 3 for further details.8. Fourth quarter 2012 included a pre-tax gain of $117 recorded in other income, net associated with the sale of a business within the Agriculture segment.9. Second quarter 2011 included charges related to the businesses acquired from Danisco of $(103), recorded in cost of goods sold and other operating charges, including $(60) oftransaction costs and a $(43) charge related to the fair value step-up of inventories that were acquired from Danisco.10. Third quarter 2011 included charges related to the businesses acquired from Danisco of $(171). These charges included $(3) of transaction costs and a $(132) charge related to thefair value step-up of inventories that were acquired from Danisco, both recorded in cost of goods sold and other operating charges. These charges also included a $(36) restructuringcharge recorded in employee separation / asset related charges, net related to severance and related benefit costs.11. Third quarter 2011 included a $(50) charge recorded in research and development expense in connection with a milestone payment associated with a Pioneer licensing agreement.12. Third and fourth quarter 2011 included charges of $(75) and $(100), respectively, recorded in costs of goods sold and other operating charges associated with the company's processto fairly resolve claims related to the use of Imprelis®. See description in Note 16 for further details.13. Fourth quarter 2011 included a $(17) restructuring charge recorded in employee separation / asset related charges, net related to severance and related benefit costs associated withthe Danisco acquisition, partially offset by a reversal of prior year restructuring accruals.14. Fourth quarter 2011 included a pre-tax gain of $49 recorded in other income, net associated with the sale of a business in the Performance Materials segment and a related taxbenefit of $73.F-50E. I. du Pont de Nemours and CompanyNotes to the Consolidated Financial Statements (continued)(Dollars in millions, except per share)24. SUBSEQUENT EVENTSDivestiture of Performance CoatingsOn February 1, 2013, the company completed its sale of the Performance Coatings business. See Note 2 for additional details.American Taxpayer Relief Act of 2012On January 2, 2013, U.S. tax law was enacted which extends, through 2013, several expired or expiring temporary business tax provisions. See Note 6 foradditional details.Inventory ValuationEffective January 1, 2013, the company changed its method of valuing inventory held at certain of its foreign and U.S. locations from the LIFO method to theaverage cost method. See Note 9 for additional details.F-51 Information for Investors Corporate HeadquartersE. I. du Pont de Nemours and Company1007 Market StreetWilmington, DE 19898Telephone: 302 774-1000E-mail: http://www.dupont.com (click on Contact)2013 Annual MeetingThe annual meeting of the shareholders will be held at 10:30 a.m., on Wednesday,April 24, in The DuPont Theatre in the DuPont Building, 1007 Market Street,Wilmington, Delaware.Stock Exchange ListingsDuPont common stock (Symbol DD) is listed on the New York Stock Exchange, Inc.(NYSE) and on certain foreign exchanges. Quarterly high and low market prices areshown in Item 5 of the Form 10-K.DuPont preferred stock is listed on the New York Stock Exchange, Inc. (SymbolDDPrA for $3.50 series and Symbol DDPrB for $4.50 series).DividendsHolders of the company's common stock are entitled to receive dividends when they aredeclared by the Board of Directors. While it is not a guarantee of future conduct, thecompany has continuously paid a quarterly dividend since the fourth quarter 1904.Dividends on common stock and preferred stock are usually declared in January, April,July and October. When dividends on common stock are declared, they are usuallypaid mid March, June, September and December. Preferred dividends are paid on orabout the 25th of January, April, July and October.Shareholder ServicesInquiries from shareholders about stock accounts, transfers, certificates, dividends(including direct deposit and reinvestment), name or address changes and electronicreceipt of proxy materials may be directed to DuPont's stock transfer agent:Computershare Trust Company, N.A.P.O. Box 43078Providence, RI 02940-3078or call: in the United States and Canada888 983-8766 (toll-free)other locations-781 575-2724for the hearing impaired-TDD: 800 952-9245 (toll-free)or visit Computershare's home page at http://www.computershare.com Independent Registered Public Accounting FirmPricewaterhouseCoopers LLPTwo Commerce Square, Suite 17002001 Market StreetPhiladelphia, PA 19103Investor RelationsInstitutional investors and other representatives of financial institutions should contact:E. I. du Pont de Nemours and CompanyDuPont Investor Relations1007 Market Street-D-11020Wilmington, DE 19898or call 302 774-4994Bondholder RelationsE. I. du Pont de Nemours and CompanyDuPont Finance1007 Market Street-D-8028Wilmington, DE 19898or call 302 774-0564or 302 774-8802DuPont on the InternetFinancial results, news and other information about DuPont can be accessed from thecompany's website at http://www.dupont.com. This site includes important information onproducts and services, financial reports, news releases, environmental information andcareer opportunities. The company's periodic and current reports filed with the SEC areavailable on its website, free of charge, as soon as reasonably practicable after beingfiled.Product Information/ReferralFrom the United States and Canada:800 441-7515 (toll-free)From other locations: 302 774-1000On the Internet: http://www.dupont.com (click on Contact)Printed Reports Available to ShareholdersThe following company reports may be obtained, without charge:1. 2012 Annual Report to the Securities and Exchange Commission, filed on Form 10-K;2. Proxy Statement for 2013 Annual Meeting of Stockholders; and3. Quarterly reports to the Securities and Exchange Commission, filed on Form 10-QRequests should be addressed to:DuPont Inquiry Management CenterCRP-735 (second floor)974 Centre RoadWilmington, DE 19805or call 302 774-1000E-mail: http://www.dupont.com (click on Contact) Services for ShareholdersOnline Account AccessRegistered shareholders may access their accounts and obtain online answers to stocktransfer questions by signing up for Internet access by visitinghttp://www.computershare.com.Dividend Reinvestment PlanAn automatic dividend reinvestment plan is available to all registered shareholders.Common or preferred dividends can be automatically reinvested in DuPont commonstock. Participants also may add cash for the purchase of additional shares. A detailedaccount statement is mailed after each investment. Your account can also be viewedover the Internet if you have Online Account Access (see above). To enroll in the plan,please contact Computershare (listed above). Online Delivery of Proxy MaterialsStockholders may request their proxy materials electronically in 2013 byvisiting http://enroll.icsdelivery.com/dd.Direct Deposit of DividendsRegistered shareholders who would like their dividends directly deposited in a U.S.bank account should contact Computershare (listed above).Exhibit 3.1RESTATED CERTIFICATE OF INCORPORATION OFE. I. DU PONT DE NEMOURS AND COMPANYE. I. du Pont de Nemours and Company, a corporation organized and existing under the Laws of the State of Delaware, hereby certifies asfollows:1.The name of the corporation is E. I. du Pont de Nemours and Company. The date of filing its original Certificate of Incorporation withthe Secretary of State was September 4, 1915.2.This Restated Certificate of Incorporation only restates and integrates and does not further amend the provisions of the RestatedCertificate of Incorporation of this corporation as heretofore amended or supplemented and there is no discrepancy between thoseprovisions and the provisions of this Restated Certificate of Incorporation.3.The text of the Restated Certificate of Incorporation as amended or supplemented heretofore is hereby restated without furtheramendments or changes to read as herein set forth in full.First: -- The name of the corporation is E. I. DU PONT DE NEMOURS AND COMPANYSecond: -- The principal office of the corporation is to be located at No. 1007 Market Street, in the City of Wilmington, in the County of NewCastle, in the State of Delaware. The name of its resident agent is E. I. du Pont de Nemours and Company, whose address is Room 8042,Du Pont Building, No. 1007 Market Street, in the City of Wilmington, County of New Castle, State of Delaware 19898.Third: -- The nature of the business of the corporation and the objects and purposes proposed to be transacted, promoted or carried on by it,are as follows:(a)To manufacture, produce, prepare, experiment with, purchase, and otherwise acquire, import, export, sell, distribute, and otherwisedispose of, and generally to trade and deal in, in any manner whatsoever, (1) chemicals of every description, organic or inorganic, naturalor synthetic, in the form of raw materials, intermediates, or finished products, and chemicals which may be used in the manufacture ofany and all products of every kind whatsoever; and (2) chemical products of every kind and description.(b)To engage in research, exploration, laboratory and development work relating to any substance, compound or mixture, now known orwhich may hereafter be known, discovered or developed, and to perfect, develop, manufacture, use, apply and generally deal in anysuch substance, compound or mixture.(c)To purchase or otherwise acquire, hold, own, occupy, develop, improve, sell, dispose of and convey real property and any and everyinterest therein either within or without the State of Delaware and anywhere in the world; to extract, remove, produce or prepare from anysuch property any animal, vegetable, mineral or other product or material therein or thereon, either by agricultural pursuits, mining,quarrying, or by any other method or means now know or that may hereafter be discovered or invented, and to avail itself in everymanner of each and every resource of such property by reducing it to proper form and by use, sale or other disposition thereof.(d)To erect, purchase, sell, lease, manage, occupy and improve buildings and to do and perform all things needful and lawful for theholding, development and improvement of the same for residence, trade and business purposes; to buy, own, operate, improve, leaseand occupy, lands and buildings for hotels, apartment houses, dwelling houses, and business structures of all kinds, for theaccommodation of the public and of individuals; to manage, operate, conduct, and carry on, hotels, apartment houses, dwelling houses,office buildings, restaurants, cafes, pharmacies, drug stores, theaters, and other places for the accommodation of the public and ofindividuals.(e)To manufacture, acquire, own, sell or otherwise dispose of all kinds of goods, merchandise and personal property of every naturewhatsoever either within or without the State of Delaware and anywhere in the world.1(f)To engage in all kinds of business, including the following but without excluding others: All manufacturing, milling, mining, quarrying,building, construction and industrial works and operations; development and utilization of every kind of power; the acquirement,construction, use, operation, sale and other disposition of all kinds of machinery, plants, factories, warehouses, elevators, buildings andother structures, bridges, wharves, docks, slips, dams, power works, water works, boats, ships, engines, cars, equipment andappliances, whether in connection with said business or otherwise, and generally the utilization of all instrumentalities, methods,processes and appliances, in all ways and by all means now known or which may hereafter be discovered or invented.(g)To apply for, obtain, register, purchase, lease or otherwise to acquire, and to hold, use, own, operate and introduce, and to sell, assign orotherwise to dispose of any trademarks, trade-names, brands, copyrights, concessions, patents, inventions, formulae, improvementsand processes used in connection with or secured under letters patent of the United States, or any other country, or otherwise, and touse, exercise, develop, grant licenses in respect of, or otherwise to turn to account any such trademarks, copyrights, concessions,patents, licenses, processes and the like, or any such property or rights.(h)To subscribe or cause to be subscribed for, and to purchase or otherwise acquire, hold for investment, or otherwise, sell, assign, transfer,mortgage, pledge, exchange, distribute or otherwise dispose of the whole or any part of the shares of the capital stock, bonds, coupons,mortgages, deeds of trust, debentures, securities, obligations, evidences of indebtedness, notes, goodwill, rights, assets and property ofany and every kind whatsoever, or any part thereof of itself or any other corporation or corporations, stock companies, association orassociations, now or hereafter existing, and whether created by or under the laws of the State of Delaware, or of any other state, district,territory or colony of the United States, or any other country or otherwise, and to use, operate, manage and control such properties or anyof them, either in the name of such other corporation or corporations, stock company or association, or in the name of this corporation,and while owners of any of said shares of capital stock or bonds or other property to exercise all the rights, powers and privileges ofownership of every kind and description, including the right to vote thereon, with power to designate some person for that purpose fromtime to time to the same extent as natural persons might or could do.(i)To endorse, guarantee and secure the payment and satisfaction of the bonds, coupons, mortgages, deeds of trust, debentures,securities, obligations, evidences of indebtedness, and shares of the capital stock of other corporations, and also to guarantee and securethe payment or satisfaction of dividends on shares of the capital stock of other corporations; also to undertake the whole or any part of theassets and liabilities, existing or prospective, of any person, firm or association, also to procure any other person or corporation toassume any such obligation or obligations.(j)Without in any particular limiting any of the objects and powers of the corporation, it is hereby expressly declared and provided that thecorporation shall have power to do all the things hereinbefore enumerated, and also to issue or exchange stock, bonds and otherobligations in payment for property purchased or acquired by it, or for any other object in or about its business; to borrow money withoutlimit; to mortgage or pledge its franchises, real or personal property, income and profits accruing to it, any stocks, bonds or otherobligations, or any property which may be acquired by it; to secure any bonds or other obligations by it issued or incurred; to guaranteeany dividends, or bonds, or contracts, or other obligations; to make and perform contracts of any kind and description, and in carrying onits business, or for the purpose of attaining or furthering any of its objects, to do any and all other acts and things, and to exercise any andall other powers which a co-partnership or natural person could do and exercise, and which now or hereafter may be authorized by law inany part of the world.(k)To carry on any business whatsoever which the corporation may deem proper or convenient in connection with any of the foregoingpurposes or otherwise, or which may be calculated directly or indirectly to promote the interests of the corporation or to enhance the valueof its property; and it is the purpose of the corporation from time to time to do any one or more of the acts and things herein set forth; andit may conduct its business in other states, in the territories, the District of Columbia, the colonies and dependencies and in foreigncountries and places; it may have one office or more than one office and keep the books of the company outside the State of Delaware,except as otherwise provided by law.2Fourth: The total authorized stock of the corporation is as follows:The total number of shares of all classes of stock which the corporation shall have authority to issue shall be One Billion Eight HundredTwenty-Three Million (1,823,000,000), of which Twenty-Three Million (23,000,000) shares shall be Preferred Stock without par value andOne Billion Eight Hundred Million (1,800,000,000) shares shall be Common Stock having a par value of Thirty Cents ($0.30) each.I.The Preferred Stock may be issued from time to time in one or more series, each of such series to have such designation, preferencesand relative, optional or other rights, and qualifications, limitations or restrictions thereof, as are stated and expressed herein, or in aresolution or resolutions providing for the issue of such series adopted by the Board of Directors as hereinafter provided.II.(a) The 1,688,850 shares of the corporation's Preferred Stock issued and outstanding on April 25, 1947, shall constitute a series ofPreferred Stock, designated as "Preferred Stock - $4.50 Series" (hereinafter sometimes called the "$4.50 Series Stock"). The Boardof Directors may from time to time authorize the issuance of additional shares of Preferred Stock as $4.50 Series Stock.(b) The shares of $4.50 Series Stock shall bear dividends at the rate of Four Dollars and Fifty Cents ($4.50) per annum from and afterApril 25, 1947, provided, however, that any shares of said Series issued after April 25, 1947 shall bear dividends from and after such dateor dates as the Board of Directors from time to time may determine.(c) In the event of any liquidation or dissolution or winding-up of the corporation, whether voluntary or involuntary, the Preferred Stock -$4.50 Series shall entitle the holders thereof to be paid, in the event of any involuntary liquidation or dissolution or winding-up of thecorporation, One Hundred Dollars ($100.00) per share with all unpaid accumulated dividends thereon to the date of such payment or, inthe event of any voluntary liquidation or dissolution or winding-up of the corporation, One Hundred Fifteen Dollars ($115.00) per share withall unpaid accumulated dividends thereon to the date of such payment.(d) The Preferred Stock - $4.50 Series shall be subject to redemption on or before April 25, 1952 at One Hundred Twenty-Five Dollars($125.00) per share and accumulated dividends thereon to the date of redemption, and thereafter at One Hundred Twenty Dollars ($120.00)per share and accumulated dividends thereon to the date of redemption, upon the terms and in the manner as hereinafter provided.III.Authority is hereby expressly granted to the Board of Directors of the corporation, subject to the provisions of this Article FOURTH,to authorize the issue of one or more series of Preferred Stock in addition to the $4.50 Series and with respect to each such series to fixby resolution or resolutions providing for the issue of such series: (a) The number of shares to constitute such series and the distinctive designation thereof;(b) The dividend rate on the shares of such series and the date or dates from which dividends shall accumulate;(c) The amount per share over and above any accumulated dividends thereon which the shares of such series shall be entitled to receiveupon redemption;(d) The amount per share over and above accumulated dividends which such series shall be entitled to receive (1) upon involuntaryliquidation or dissolution or winding-up of the corporation, which amount shall not exceed $100.00 a share, and (2) upon voluntaryliquidation or dissolution or winding-up of the corporation; and(e) The rights, if any, which the shares of such series may have for conversion into shares of any other class or classes or any other seriesof the same or any other class or classes of stock of the corporation.All shares of any one series of Preferred Stock shall be identical with each other in all respects, except that shares of any one seriesissued at different times may differ as to the dates from which 3the initial dividends thereon shall accumulate; and all series shall rank equally and be identical in all respects, except as permitted in theforegoing provisions of this Section III.IIIA A new series of Preferred Stock without par value of the corporation shall have the designation, the number of shares to beissued, the dividend rate, the redemption price and the amount payable upon liquidation or dissolution or winding up of the corporationwith respect to such new series of Preferred Stock without par value as follows, such attributes to be in addition to the other provisionsset forth in this Article Fourth, which are applicable to all shares of Preferred Stock without par value irrespective of any variationsbetween the shares of Preferred Stock without par value of the different series.(a) The new series of Preferred Stock without par value of the corporation is designated Preferred Stock - $3.50 Series;(b) Preferred Stock - $3.50 Series is authorized to be issued in the amount of 700,000 shares;(c) The dividend rate on the Preferred Stock - $3.50 Series shall be $3.50 per share per annum and no more, and dividends on the700,000 shares of Preferred Stock - $3.50 Series shall accumulate from and after April 25, 1947;(d) The amount per share over and above any accumulated dividends thereon which the shares of Preferred Stock - $3.50 Series shallbe entitled to receive upon redemption is as follows: if redeemed on or before April 25, 1952, $107.00 a share; thereafter on or before April25, 1955, $106.00 a share; thereafter on or before April 25, 1958, $105.00 a share; thereafter on or before April 25, 1961, $104.00 ashare; thereafter on or before April 25, 1964, $103.00 a share, and thereafter, $102.00 a share; ande) The amount per share over and above accumulated dividends which the shares of Preferred Stock - $3.50 Series shall be entitled toreceive upon involuntary liquidation or dissolution or winding-up of the corporation is $100.00 a share, and upon voluntary liquidation ordissolution or winding-up of the corporation is $107.00 a share.IV.The Preferred Stock shall entitle the holders thereof to receive, when and as declared from the surplus or net earnings of thecorporation, cumulative dividends, payable quarterly on such dates as the Board of Directors may determine, at the rates fixedherein or fixed by the Board of Directors for the respective series, as herein provided, and no more, which dividends shall be paid orset apart before any dividend shall be set apart or paid on the Common Stock. The dividend payment dates for all series of PreferredStock shall be the same and no dividends shall be declared on any series in respect of any quarterly dividend payment unless thereshall likewise be or have been declared on all shares of Preferred Stock of each other series at the time outstanding like proportionatedividends ratably in proportion to the respective annual dividend rates fixed therefor.V.In the event of any liquidation or dissolution or winding-up of the corporation, whether voluntary or involuntary, the Preferred Stockshall entitle the holders thereof to be paid the amounts fixed herein or fixed by the Board of Directors for the respective series asherein provided, including all unpaid accumulated dividends thereon to the date of such payment, before any amount shall be paid tothe holders of the Common Stock of the corporation. Such payments to the holders of the Preferred Stock shall be made without preference or priority of one series over any other series andshall be made before any amount shall be paid to the holders of the Common Stock. If the assets of the corporation distributable upon anysuch liquidation or dissolution or winding-up of the corporation shall be insufficient to permit the payments to the holders of the PreferredStock of the full amounts above provided for, including an amount equivalent to all unpaid accumulated dividends as aforesaid, the saidassets shall be allocated to the respective series of Preferred Stock in the ratios that such aggregate liquidation value of the issued sharesof each series bears to the aggregate liquidation value of the issued shares of all series of Preferred Stock as fixed for the respective seriesof Preferred Stock in the Certificate of Incorporation or in the resolution or resolutions of the Board of Directors providing for the issuance of the respective series, and shall be4distributed among the holders of the respective series of Preferred Stock according to their respective shares.VI.The Preferred Stock of any series shall be subject to redemption at any time in whole or in part at the amount fixed herein, or fixedby the Board of Directors as herein provided, for the redemption of such series including an amount equivalent to all unpaidaccumulated dividends thereon, upon not less than sixty days' notice addressed to the respective holders of record of the stock to beredeemed at their addresses as the same shall appear on the stock transfer records of the corporation in such manner as the Boardof Directors shall determine.VII.The holders of the Preferred Stock shall have no voting power on any questions whatsoever except as otherwise provided bylaw, and except that in the event that the corporation shall fail to pay any dividend on the Preferred Stock when it regularlybecomes due and such default shall continue for the period of six (6) months, then until but not after such time asaccumulated and unpaid dividends on all outstanding Preferred Stock of all series shall have been paid, the holders of theoutstanding Preferred Stock shall have the exclusive right, voting separately and as a class, to elect two directors or, if thetotal number of directors of the corporation be only three, then only one director, at each meeting of the stockholders of thecorporation held for the purpose of electing directors. At all meetings of stockholders held for the purpose of electing directorsat which the holders of Preferred Stock shall have the exclusive right, voting separately and as a class, to elect any directorsas aforesaid, the presence in person or by proxy of the holders of a majority of the outstanding shares of Preferred Stockshall be required to constitute a quorum of such class for the election of any directors by holders of Preferred Stock, as aclass, provided, however, that the absence of a quorum of the holders of Preferred Stock shall not prevent the election at anysuch meeting or adjournment thereof of the remaining directors for whose election a class vote of the holders of PreferredStock is not required, if the necessary quorum of the stockholders entitled to vote in the election of such remaining directorsis present in person or by proxy in accordance with the by-laws of the corporation; and provided further, that in the absence ofa quorum of the holders of Preferred Stock, a majority of those holders of such Preferred Stock who are present in person orby proxy shall have power to adjourn the election of those directors to be elected by their class from time to time withoutnotice other than announcement at the meeting until the requisite amount of holders of Preferred Stock shall be present inperson or by proxy.The holders of Common Stock shall have the right to vote on all questions to the exclusion of all other stockholders except ashereinbefore specifically stated.VIII.Whenever, at any time, full accumulated dividends as aforesaid for all past dividend periods and for the current dividendperiod shall have been paid, or declared and set apart for payment, on the then outstanding Preferred Stock, the Board ofDirectors may declare dividends on the Common Stock of the corporation.IX.Upon any liquidation or dissolution or winding-up of the corporation, whether voluntary or involuntary, the assets and funds of thecorporation remaining, after the payments have been made to the holders of the Preferred Stock, as provided in Section V hereof,shall be divided and paid to the holders of the Common Stock according to their respective shares.X.From time to time the Preferred Stock or the Common Stock may be increased according to law.XI.From time to time the Preferred Stock and the Common Stock may be issued in such amounts and proportions and for suchconsideration as may be fixed by the Board of Directors, or, in the case of Common Stock issued upon the exercise of the optionsreferred to in Section XIII hereof, as provided in such Section.5XII.No stockholder of the corporation, of whatever class or series, shall have any preemptive or preferential right of subscriptionto any shares of any series of the Preferred Stock of the corporation, authorized hereunder or under any amendment hereof,or to any obligations convertible into said Preferred Stock of any series of the corporation, issued or sold, nor any right ofsubscription to any thereof other than such, if any, as the Board of Directors of the corporation in its discretion from time totime may determine, and the Board of Directors may issue said Preferred Stock of any series of the corporation, orobligations convertible into said Preferred Stock of any series, without offering said Preferred Stock, or said obligations,either in whole or in part, to any stockholders of the corporation. No holder of any shares of the Preferred Stock of any series of the corporation shall have any preemptive or preferential right ofsubscription to any shares of stock of any class of the corporation, or to any obligations convertible into shares of stock of any class of thecorporation, issued or sold, nor any right of subscription to any thereof other than such, if any, as the Board of Directors of thecorporation in its discretion from time to time may determine.XIII.The Board of Directors may create and issue to employees (including officers and directors) of this corporation, or of anycorporation in which this corporation shall directly or indirectly own fifty per cent or more of the voting stock, options topurchase the corporation's Common Stock in accordance with the terms of any duly adopted compensation plan. Theshares of stock so optioned may be unissued, or issued and reacquired shares of Common Stock of the corporation, asshall be determined by the Board of Directors, and the Board shall have power to take all action necessary and appropriate inconnection with any such issuance or sale of shares. The options shall be evidenced by such instruments as shall beapproved by the Board of Directors. The terms upon which, the time or times at or within which, and the consideration forwhich such options may be issued, and for which any shares of stock may be issued or sold by the corporation upon theexercise of such options, shall be such as shall be stated in the resolution or resolutions adopted by the Board of Directorsproviding for the creation and issuance of such options and, in every case, set forth or incorporated by reference in theinstrument or instruments evidencing such options. The judgment of the Board of Directors as to the consideration andsufficiency thereof for the issuance of such options and for the issuance or sale of stock pursuant to the exercise thereof shallbe conclusive.Any standing committee duly designated by resolution passed by a majority of the whole Board of Directors and consisting of two ormore of the directors, shall have and may exercise any or all of the rights, powers and functions of the Board of Directors specified in thisSection XIII, or otherwise pertaining to any duly adopted compensation plan, to the extent provided in a resolution passed by a majorityof the whole Board or in the By-Laws of the corporation.XIV.The amount of capital stock with which this corporation will commence business is Seventy-five Hundred Dollars ($7,500).Fifth: The names and places of residence of each of the original subscribers to the capital stock and the number of shares subscribed for byeach are as follows:NameResidenceNumber of SharesPierre S. du PontChristiana Hundred, Delaware25John J. RaskobBrandywine Hundred, Delaware25John P. LaffeyWilmington, Delaware25Sixth: The corporation is to have perpetual existence.Seventh: The private property of the stockholders shall not be subject to the payment of corporate debts to any extent whatever.6Eighth: The number of the directors of the corporation shall be fixed from time to time by the by-laws and the number may be increased ordecreased as therein provided.In case of any increase in the number of directors the additional directors shall be elected as provided by the By-laws by the directors or by thestockholders at an annual or special meeting.In case of any vacancy in the Board of Directors for any cause the remaining Directors by affirmative vote of a majority of the whole Board ofDirectors may elect a successor to hold office for the unexpired term of the Director whose place is vacant and until the election of hissuccessor.In furtherance, but not in limitation of the powers conferred by law, the Board of Directors are expressly authorized:(a)To hold their meetings outside of the State of Delaware at such places as from time to time may be designated by the By-laws or byresolution of the Board. The By-laws may prescribe the number of directors necessary to constitute a quorum of the Board ofDirectors, which number may be less than a majority of the whole number of directors.(b)To appoint the regular officers of the corporation, and such other officers as they may deem necessary for the proper conduct of thebusiness of the Company.(c)To remove at any time any officer elected or appointed by the Board of Directors but only by the affirmative vote of a majority of thewhole Board of Directors.(d)To remove any other officer or employee of the corporation or to confer such power on any committee or superior officer of thecorporation, unless such removals are otherwise regulated by the By-laws.(e)To appoint standing committees by the affirmative vote of a majority of the whole Board, and such standing committees shall haveand may exercise such powers as shall be conferred or authorized by the By-Laws.(f)To issue the stock of every class in such amounts and proportions as they may determine up to the total amount of the authorizedcapital stock or any increase thereof, subject, however, to the provisions of this certificate.(g)From time to time to fix and determine and to vary the sum to be reserved over and above its capital stock paid in as working capitalbefore declaring any dividends among its stockholders; to direct and determine the use and disposition of any surplus or net profitsover and above the capital stock paid in; to fix the time of declaring and paying any dividend, and, unless otherwise provided in theBy-laws, to determine the amount of any dividend. All sums reserved as working capital or otherwise may be applied from time totime to the acquisition or purchase of its bonds or other obligations or shares of its own capital stock or other property to such extentand in such manner and upon such terms as the Board of Directors shall deem expedient, and neither the stock, bonds or otherproperty so acquired shall be regarded as accumulated profits for the purpose of declaring or paying dividends unless otherwisedetermined by the Board of Directors, but shares of such capital stock so purchased or acquired may be resold, unless such sharesshall have been retired for the purpose of decreasing the Company's capital stock as provided by law.(h)From time to time to determine whether and to what extent, and at what times and places, and under what conditions andregulations the accounts and books of the corporation, or any of them, shall be open to the inspection of the stock- holders, and nostockholders shall have any right to inspect any account or book or document of the corporation, except as conferred by statute orauthorized by the Board of Directors or by a resolution of the stockholders.(i)Subject always to By-laws made by the stockholders, to make By-laws; and, from time to time, to alter, amend or repeal any By-laws; but any By-laws made by the Board of Directors may be altered7or repealed by the stockholders at any annual meeting, or at any special meeting, provided notice of such proposed alteration orrepeal be included in the notice of the meeting.(j)With the written assent, without a meeting of the holders of two-thirds of its stock, or pursuant to the affirmative vote, in person orby proxy, at any meeting called as provided in the By-laws, of the holders of two-thirds of its stock, issued and outstanding, theBoard of Directors may sell, convey, assign, transfer or otherwise dispose of, the property, assets, rights and privileges of thecorporation as an entirety, for such consideration and on such terms as they may determine.Ninth: A director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach offiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to the corporation or its stockholders, (ii) for actsor omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the GeneralCorporation Law of Delaware, or (iv) for any transaction from which the director derived any improper personal benefit. If the GeneralCorporation Law of Delaware is amended after approval by the stockholders of this article to authorize corporate action further eliminating orlimiting the personal liability of directors, then the liability of a director of the corporation shall be eliminated or limited to the full extentpermitted by the General Corporation Law of Delaware, as so amended.Any repeal or modification of the foregoing paragraph by the stockholders of the corporation shall not adversely affect any right or protection ofa director of the corporation existing at the time of such repeal or modification.4. This Restated Certificate of Incorporation was duly adopted by the Board of Directors in accordance with Section 245 of the GeneralCorporation Law of the State of Delaware.5. This Restated Certificate of Incorporation shall be effective at 5:00 p.m. Eastern Daylight Time on May 29, 1997.IN WITNESS WHEREOF, said E. I. du Pont de Nemours and Company has caused this certificate to be signed by Howard J. Rudge, itsSenior Vice President and General Counsel, and attested by Louise B. Lancaster, its Secretary, this 29th day of May, 1997.E. I. DU PONT DE NEMOURS AND COMPANYBy: /s/ Howard J. RudgeSenior Vice President and General CounselATTEST:By: /s/ Louise B. LancasterSecretary8Exhibit 10.8RETIREMENT SAVINGS RESTORATION PLANOriginally Adopted - January 1, 2007Last Amended December 18, 2012Effective January 1, 2013E. I. du Pont de Nemours and CompanyRETIREMENT SAVINGS RESTORATION PLANI. PURPOSEThe purpose of this Plan is to provide an eligible employee with the opportunity to defer, until termination of employment, receipt of salarythat, because of compensation limits imposed by law, is ineligible to be considered in calculating benefits within the Company's tax-qualified definedcontribution plan(s) and thereby recover benefits lost because of that restriction.II. ADMINISTRATIONThe administration of this Plan is vested in the Benefit Plan Administrative Committee appointed by the Senior Vice President - HR of E. I.du Pont de Nemours and Company. The Committee may adopt such rules as it may deem necessary for the proper administration of the Plan, andmay appoint such person(s) or group(s) as may be judged necessary to assist in the administration of the Plan. The Committee's decision in allmatters involving the interpretation and application of this Plan shall be final. The Committee shall have the discretionary right to determineeligibility for benefits hereunder and to construe the terms and conditions of this Plan. In all cases, terms of this Plan shall be interpreted asnecessary to comply with the requirements of Section 409A of the Internal Revenue Code and accompanying regulations.III. ELIGIBILITYAn employee of the Company who is eligible to participate in the E. I. du Pont de Nemours and Company Retirement Savings Plan and whois Grade 13 or above (or equivalent level for a participating subsidiary), or an employee of a Company who is eligible to participate in the tax-qualified 401(k) plan sponsored by the Company and who is eligible as listed on Exhibit A, shall be eligible to participate in this Plan (hereinafter“Participant”).For purposes of this Plan, the term "Company" means E.I. du Pont de Nemours and Company, any wholly-owned subsidiary or partthereof and any joint venture, partnership, or other entity in which E.I. du Pont de Nemours and Company has an ownership interest, provided thatsuch entity (1) adopts this Plan with the approval of E.I. du Pont de Nemours and Company and (2) agrees to make the necessary financialcommitment in respect of any of its employees who become Participants in this Plan.IV. PARTICIPANTS' ACCOUNTS(A) Participant Contributions. A Participant may elect to defer receipt of a percentage of compensation in excess of the amount prescribed inInternal Revenue Code Section 401(a)(17), and have the dollar equivalent of the deferral percentage credited to a Participant Account under this Plan.The deferral percentage elected under this Plan shall not exceed 6%. Except as provided below, such deferral election will be made prior to thebeginning of each calendar year and will be irrevocable for that calendar year.For purposes of a Participant's first year of participation in this Plan, the compensation deferral election must be made within 30 days of the date theemployee becomes eligible to participate in the Plan, and no later than 30 days prior to the first day of the month for which compensation is deferredand will be irrevocable for the remainder of that calendar year.(B) Company Matching Contributions. To the extent that a Participant makes a deferral election under the terms of subparagraph (A) above,the Company will credit to that Participant's Account in this Plan an amount equivalent to 100% of the Participant Contribution.(C) Company Non-elective Contributions. For each employee eligible to participate in this Plan, whether or not he or she makes a deferralelection under the terms of subparagraph (A) above, the Company will credit to that Participant's Account in this Plan an amount equal to 3% of theemployee's compensation in excess of the amount prescribed in Internal Revenue Code Section 401(a)(17).(D) Earnings Equivalents. Credits for Participant Contributions and Company Matching and Non-elective Contributions shall be treated ashaving been invested in one or more of the investment options available for the ongoing deposit of new employee contributions in the RetirementSavings Plan. Additional credit (or debit) amounts will be posted to the Participant's Account in this Plan based on the performance of thoseinvestment options.The Participant shall have the right to:(1)designate which of the available investment options are to be used in valuing his/her Account under this Plan, subject to the rulesgoverning investment direction in the Retirement Savings Plan; and/or(2)change the designated investment options used in valuing his/her Account under this Plan, subject to the rules governing investmentdirection and/or transfers among funds in the Retirement Savings Plan.(E) Credits to Accounts. Participant Contributions, Company Matching and Non-elective Contributions and Earnings Equivalents shall becredited (or debited) to the Participant's Account under this Plan as unfunded book entries stated as cash balances, and will not be payable toParticipants until such time as employment with the Company terminates. The cash balances in Participant Accounts shall be unfunded generalobligations of the Company, and no Participant shall have any claim to or security interest in any asset of the Company on account thereof.(F) Definition of Compensation. Compensation for purposes of this Plan shall mean “compensation” as defined in the tax-qualified plan inwhich the Participant participates.V. VESTINGParticipant Contributions and Company Matching and Earnings Equivalents attributable thereto shall be vested at the time such amountsare credited to the Participant's Account. Company Non-elective Contributions and Earnings Equivalents thereto shall be vested after the employeecompletes 3 years of service, as defined in the as defined in the tax-qualified plan in which the Participant participates.VI. PAYMENT OF BENEFITSAmounts payable under this Plan shall be distributed in one of the following forms and at a time as elected by the Participant:(1) a lump sum at termination of employment, or in any year up to five years after termination of employment; or(2) annual installments for up to 15 years, beginning in the year of termination of employment or in any of the first five years followingtermination of employment.If the Participant does not make a valid election as to form and time of distribution, or upon the Participant's death, amounts payable shallbe delivered in a cash lump sum as soon as practical after termination of employment or death. Any such election shall be made by the Participant atthe time the deferral election is made. Notwithstanding any provision of this Plan to the contrary, amounts payable to an officer of the Company shallbe paid no sooner than the sixth month anniversary of the employee's termination date. All payments under this Plan shall be made by, and allexpenses of administering this Plan shall be borne by, the Company.Benefits payable due to a Participant's death shall be paid to the beneficiary designated on the most recent valid beneficiary designationform received by the Committee, or, if no valid beneficiary designation is on file or the beneficiary cannot be determined by the Committee, to theParticipant's estate.VII. NON-ASSIGNMENTNo assignment or alienation of the rights and interests of participants, beneficiaries and survivors under this Plan will be permitted orrecognized under any circumstances. Plan benefits can be paid only to participants, beneficiaries or survivors.VIII. RIGHT TO MODIFYE. I . du Pont de Nemours and Company reserves the right to change or discontinue this Plan in its discretion by action of theCompensation Committee of the Board of Directors, or its delegate.Retirement Savings Restoration PlanExhibit AParticipating Employers (Effective as of January 1, 2013)E. I. du Pont de Nemours and Company - Level 13 and aboveDuPont Performance Elastomers LLCEKC Technology, Inc. Effective January 1, 2009First Chemical Corporation Effective January 1, 2009First Chemical Texas, LP Effective January 1, 2009DuPont Electronic Polymers, LP Effective January 1, 2009DuPont Authentication, Inc. Effective January 1, 2009DuPont Displays Inc. Effective January 1, 2009DuPont Displays Enhancements, Inc. Effective January 1, 2009Pioneer Hi-Bred International, Inc.Level 20 and above - effective 6-30-11 for compensation paid beginning in 2012Level 19 and above - effective January 1, 2013Danisco US Inc. Effective January 1, 2013Danisco USA Inc. Effective January 1, 2013Finnsuar Bioproducts, Inc. Effective January 1, 2013Genecor International Wisconsin Inc. Effective January 1, 2013Agtech Products Inc. Effective January 1, 2013Solae LLC Effective January 1, 2013Execution VersionExhibit 10.13AMENDMENT TO PURCHASE AGREEMENTAMENDMENT (this "Amendment"), dated as of January 31, 2013, by and between E. I. du Pont de Nemours andCompany, a Delaware corporation ("DuPont"), and Flash Bermuda Co. Ltd., a Delaware limited liability company (the "Buyer"), to thePurchase Agreement, dated August 30, 2012 (the "Agreement"), by and between DuPont and the Buyer. Unless otherwise specificallydefined herein, each term used herein shall have the meaning ascribed to such term in the Agreement.WHEREAS, the parties hereto desire to amend the Agreement, as more fully set forth below.NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and for other goodand valuable consideration, and intending to be legally bound hereby, the parties hereto hereby agree as follows:ARTICLE I AMENDMENTSECTION 1.1 Pension Purchase Price Adjustment. Section 2.4 of the Agreement is hereby amended by inserting thefollowing new subsection (d) immediately following subsection (c) thereof:"(d) The parties acknowledge that the Pension Transfer that is contemplated to occur under Section 2.7(b) of theEmployee Matters Agreement in respect of the E. I du Pont Canada Company Pension Plan (the “Canada PensionTransfer”) is not expected to occur within one hundred eighty (180) days following the Closing Date and that Flash LuxCo S.A R.L. and E.I. du Pont Canada Company (“DuPont Canada”) shall enter into a certain Pension TransferAgreement on the Closing Date (the “Canada Pension Transfer Agreement”) in respect of the Canada Pension Transfer.Notwithstanding anything in this Section 2.4 to the contrary, to the extent that the Canada Pension Transfer does notoccur within one hundred eighty (180) days following the Closing Date, the Final Pension Funding Amount shall bedetermined pursuant to Sections 2.4(a) and 2.4(b) on the basis that the value of the assets as of the Closing Date to betransferred in connection with the Canada Pension Transfer will be equal to the Transfer Amount (as defined in theCanada Pension Transfer Agreement) as reflected in the initial application(s) to the applicable regulatory authorities forthe approval of the Canada Pension Transfer that is submitted by DuPont Canada in accordance with the first sentence1 of Section 2.2(d) of the Canada Pension Transfer Agreement (the “Expected Canada Transfer Amount”), andaccordingly, subject to the later provisions of this Section 2.4(d), such amount shall be treated as Pension Assets forpurposes of this Section 2.4. At the time the Canada Pension Transfer occurs in accordance with the Canada PensionTransfer Agreement, if the regulatory authorities require that the value of assets to be transferred as of the ClosingDate be equal to the Directed Amount (as defined in Section 2.2(e) of the Canada Pension Transfer Agreement), thenthe Final Pension Funding Amount shall be redetermined by substituting such Directed Amount for the ExpectedCanada Transfer Amount, and the amount, if any, payable by DuPont pursuant to Section 2.4(c) shall be redetermined,provided that the amount, if any, payable in accordance with Section 2.4(c) shall be reduced by the aggregate amount, ifany, previously paid by DuPont pursuant to Section 2.4(c). DuPont shall pay any such amount within five (5) BusinessDays following such a redetermination together with interest thereon at a rate equal to the prime rate as published inThe Wall Street Journal in effect on the Closing Date for the period from the Closing Date until the date of suchpayment."SECTION 1.2 Mexican VAT.(a) The definition of Preliminary Purchase Price in Annex A of the Agreement is hereby amended by deleting theword "and" after the second comma in subsection (iii) and by inserting the following as a new subsection after subsection (iv):", and (v) minus, an amount equal to the Mexican VAT."(b) Section 6.5 of the Agreement is hereby amended and restated by deleting in its entirety all of the text of suchsection and replacing such text with the following:"6.5 Transfer Taxes. Notwithstanding anything to the contrary in this Agreement, any Local Asset TransferAgreement, any Related Agreement or any other agreement relating to the Mexican Asset Transfer, one-half of allexcise, sales, use, transfer (including real property transfer), stamp, documentary, filing, recordation and other similartaxes arising directly from the Closing, the Real Property Transfer, the Mexican Asset Transfer and transactionspursuant to the Local Purchase Agreements (but excluding any VAT and any direct or indirect capital gain Taxes andwithholding Taxes, in each case, imposed on DuPont or any of its Affiliates in connection with the transactionscontemplated by this Agreement) ("Transfer Taxes"), shall be paid to the appropriate Tax2 Authority by DuPont and one-half of such Transfer Taxes shall be paid to the appropriate Tax Authority by Buyer (or ifsuch Transfer Taxes are paid by either party hereto or their Affiliates, 50% of the amount of such payment shall bereimbursed by the other party hereto). Notwithstanding Section 6.3 hereof, which shall not apply to Tax Returnsrelating to Transfer Taxes, any Tax Returns that must be filed in connection with Transfer Taxes or the Mexican VATshall be prepared and filed when due by the party responsible for filing such Tax Returns under the applicable Lawimposing such Transfer Taxes; provided that such Tax Returns shall be prepared and filed jointly by DuPont and Buyerif either (i) no party to this Agreement is or (ii) both DuPont, on the one hand, and Buyer or the Transferred DPCCompanies and their Subsidiaries, on the other hand, are responsible for filing such Tax Returns under the applicableLaw imposing such Transfer Taxes. Notwithstanding anything to the contrary in this Agreement, any Local AssetTransfer Agreement, any Related Agreement or any other agreement relating to the Mexican Asset Transfer, anyRestructuring VAT and all excise, sales, VAT, use, transfer (including real property transfer), stamp, documentary,filing, recordation and other similar taxes arising from the removal of the Excluded Assets from the Transferred DPCCompanies, Joint Ventures and their respective Subsidiaries or the Pre-Closing Restructuring Transactions shall bepayable solely by DuPont, except for Mexican VAT arising directly from the Mexican Asset Transfer, which shall bepayable solely by DPC Mexico. For the avoidance of doubt, any VAT arising directly from the Mexican Asset Transferin excess of Mexican VAT shall be funded by DuPont and payable solely by Dumexsa."(c) Annex A of the Agreement is hereby amended by inserting the following as new definitions after the definition ofMexican Business Lease and before the definition of Minority Investment Interests:""Mexican VAT" shall mean an amount of VAT equal to $19,175,692.”SECTION 1.3 Conduct of Business. Section 5.1(i) of the Agreement is hereby amended by substituting "December31, 2013" for "the first anniversary of the Closing Date" where the latter phrase appears therein.SECTION 1.4 Transfer of Excluded Assets; Restructuring.(a) Section 5.17(c)(iii)(x) of the Agreement is hereby amended by inserting the following language after the words"IT Administrative Services Agreements" and before the word "for":3 “, with the exception of the following SLAs: Schedule 59 - Sourcing: DPC Above-the-Line Costs in the U.S. and thesimilarly titled, corresponding SLAs in the countries set forth on Exhibit EE, Schedule 65 - Sourcing: OM&S: DPCLeveraged Agreements in the U.S., Schedule 68 - Sourcing: PS: DPC Leveraged Agreements PC/MS in the U.S., andSchedule 70 - RMEP: Commodity Buy; Energy & Contract Mfg in the U.S., Schedule 3 - IT: DPC IT Above-the-LineCosts in the U.S. and the similarly titled, corresponding SLAs in the countries set forth on Exhibit FF, and Schedule 4 -IT: DPC IT New Projects and the similarly titled, corresponding SLAs in the countries set forth on Exhibit GG,”(b) Section 5.17(c)(iii)(y) of the Agreement is hereby amended by deleting the amount “$21,800,000” and substitutingthe amount “$19,300,000.”(c) Section 5.17(c)(iii)(y) of the Agreement is hereby amended by inserting after “becomes unavailable to DuPont andits Affiliates” the phrase “after the Closing Date” and continuing the balance of the sentence unchanged.SECTION 1.5 Intellectual Property.(a) The definition of "Intellectual Property" in Annex A of the Agreement is hereby amended by deleting thereference to "domain names" set forth in subsection (ii) therein.(b) The definition of “Intellectual Property” in Annex A of the Agreement is hereby amended by inserting thefollowing proviso after subsection (v):“; in each case, to the extent not including any IT Assets.”SECTION 1.6 IT Assets. The definition of “IT Assets” in Annex A of the Agreement is hereby amended by insertingthe following language at the end of the definition:“, including all intellectual property rights therein.”SECTION 1.7 Payment with Respect to DuPont Performance Coatings (Changchun) Co. Ltd.(a) Annex A of the Agreement is hereby amended by adding the following definitions:4 "DCH” shall mean Du Pont China Holding Company Limited, a foreign-invested holding company duly incorporatedunder the laws of the People’s Republic of China and an indirect Subsidiary of DuPont.“Luxco” shall mean Flash Lux Co S.à r.l., a société a responsabilité limitéé or private limited liability companyorganized under the laws of Luxembourg and an indirect Subsidiary of Buyer.“Changchun Purchase Price Amount” shall mean an amount in United States Dollars equal to $16,596,000.(b) Section 2.2 of the Agreement is hereby amended by inserting the following new subsection (d) immediatelyfollowing subsection (c) thereof:“(d) Following the establishment by DCH of a bank account in China that is able to receive foreign funds (the “DCHAccount”), upon not less than two (2) Business Day’s prior written notice from DuPont to Buyer (or at such other timeas may be agreed by the Parties), DuPont shall deliver to an account of Luxco the Changchun Purchase Price Amountby wire transfer of immediately available funds, and upon receipt of the such funds by Luxco, Buyer shall cause Luxcoto, as promptly as practicable (and in any event within one (1) Business Day), deliver the Changchun Purchase PriceAmount to DCH by wire transfer of immediately available funds to the DCH Account.”SECTION 1.8 Seller's Disclosure Schedules. The Seller's Disclosure Schedules are hereby amended and restated intheir entirety and replaced for all purposes under the Agreement with the Seller's Disclosure Schedules set forth in Annex A heretoand shall be deemed for all purposes under the Agreement to have been delivered in such form as of the date of the Agreement.SECTION 1.9 Section 338(g) Elections. The definition of “Specified Foreign Companies” in Annex A of theAgreement is hereby amended by (i) deleting “DuPont Performance Coating NewCo Ecuador” and inserting “DuPerco Ecuador S.A.”in its place; (ii) deleting “PT DP Powder Coating Indonesia” and inserting “P.T. DuPont Powder Coatings Indonesia” in its place; (iii)deleting “PT DP Power Coating Malaysia” and inserting “DuPont Powder Coatings (Malaysia) SDN BHD” in its place; (iv) deleting“DuPont Tangier” and inserting “DuPont Tangier Free Zone SAS” in its place; and (v) inserting a comma and “DuPont Portugal S.A.”after “DuPont Powder Coatings (Malaysia) SDN BHD”.5 SECTION 1.10 Environmental Permits. Article V is hereby amended by adding the following as a new Section 5.29:“Section 5.29. Environmental Permits.(a)Certain Definitions. The following terms, when used in this Section, shall have the meanings assignedto them below.(i) "Operation of the DPC Business" means the operation of the DPC Business as conductedimmediately prior to the Closing.(ii) "Outstanding Permit" means any Required DPC Permit that has not been transferred orreissued to a Transferred DPC Company as of the date of this Agreement.(iii) "Required DPC Permits" means any Environmental Permit held by DuPont or any RetainedSubsidiary and required for the lawful Operation of the DPC Business by the Transferred DPC Companies and theirSubsidiaries.(b) Transfer or Reissuance of the Required DPC Permits. Except as provided in any lease arrangement amongthe parties or their Affiliates with respect to any Required DPC Permits that are shared by DuPont and the applicable Transferred DPCCompanies and their Subsidiaries, the parties shall continue to use their reasonable best efforts to transfer or, if not transferable, securethe reissuance of any Outstanding Permit to the applicable Transferred DPC Company. With respect to each Outstanding Permit, thisobligation shall continue until such permit has been so transferred or reissued or the earliest to occur of the following: (i) the relevantGovernmental Authority declines the request to transfer or reissue such permit and reasonable efforts have been made to pursue anadministrative appeal of such decision; (ii) such Outstanding Permit is no longer required for the Operation of the DPC Business by theTransferred DPC Company; or (iii) the two (2) year anniversary of the Closing Date.(c) Continued Operation Under Existing Permits. Pending the transfer or reissuance of any OutstandingPermit, the relevant Transferred DPC Company may, to the extent permitted by all applicable Environmental Law and the terms andconditions of such Outstanding Permit, continue to operate under the Outstanding Permit, subject to the following conditions:6 (i) If the Outstanding Permit imposes any limitations on the emissions, discharges or use of anymaterials that apply to both the Transferred DPC Company and DuPont (or a Retained Subsidiary), then such emissions,discharges or use shall be allocated between DuPont (or the Retained Subsidiary, as applicable) and the Transferred DPCCompany consistent with the allocation that existed immediately prior to the Closing, and the Transferred DPC Company shallnot be permitted to modify its emissions, discharges or use of materials in any manner that would cause a violation of theOutstanding Permit.(ii) If the Outstanding Permit imposes any other operational constraints or requirements thataffect both DuPont (or a Retained Subsidiary) and a Transferred DPC Company, then both entities shall conduct their respectiveoperations in compliance with such constraints or requirements and in a manner consistent with the way such operations wereconducted immediately prior to the Closing.(iii) If any fees, expenses or expenditures are required to maintain compliance with anyOutstanding Permit (including, without limitation, any operational expenses, capital expenditures, or costs to modify existing, orinstall new, equipment), then such fees, expenses or expenditures shall be paid: (i) by DuPont if they are incurred exclusivelywith respect to DuPont’s (or a Retained Subsidiary’s) operations; (ii) by the Buyer if they are incurred exclusively with respectto the DPC Business; or (iii) shared by DuPont (or a Retained Subsidiary) and the Buyer in a manner proportionate to the usageof such Outstanding Permit by DuPont (or a Retained Subsidiary) and DPC Business immediately prior to the Closing.(iv) The Transferred DPC Companies shall provide any information requested by DuPont inorder to allow DuPont to assess compliance with the Outstanding Permits and to fulfill all obligations under the OutstandingPermits, including, without limitation, information required to comply with any reporting or notification obligations.(v) The Transferred DPC Companies and DuPont shall fully comply at all times with theOutstanding Permits and shall immediately notify the other party, as applicable, of any violation of such permits or any facts,conditions or circumstances that could affect compliance with the Outstanding Permits in the future.7 (vi) Buyer and each Transferred DPC Company shall indemnify and hold harmless the DuPontIndemnified Parties from any and all Losses arising from the post-Closing operations of any Transferred DPC Company relatedto the Outstanding Permits, including, without limitation, any Losses arising from noncompliance with any Outstanding Permitby any Transferred DPC Company. DuPont shall indemnify and hold harmless the Buyer and Transferred DPC Companiesfrom any and all Losses arising from the post-Closing operations of DuPont related to the Outstanding Permits, including,without limitation, any Losses arising from noncompliance with any Outstanding Permit by DuPont.(vii) Except as provided in any lease arrangement among the parties or their Affiliates withrespect to any Required DPC Permits that are shared by DuPont (or a Retained Subsidiary) and the applicable Transferred DPCCompanies and their Subsidiaries, the Transferred DPC Companies shall have the right, to the extent permitted by all applicableEnvironmental Law and the terms and conditions of the Outstanding Permits, to operate under the applicable OutstandingPermit until such permit has been so transferred or reissued or the earliest to occur of the following: (i) the relevantGovernmental Authority declines the request to transfer or reissue such permit and reasonable efforts have been made topursue an administrative appeal of such decision; (ii) such Outstanding Permit is no longer required for the Operation of the DPCBusiness by the Transferred DPC Company; or (iii) the two (2) year anniversary of the Closing Date; provided, however, thatthe foregoing limitations shall not apply with respect to any Required DPC Permits that are shared by DuPont and the applicableTransferred DPC Companies and their Subsidiaries (including as provided in any lease arrangement among the parties or theirAffiliates with respect to any Required DPC Permits) and are otherwise necessary for the each party’s operations at a shared site,but regarding which a Governmental Authority declines to split the permits or the parties jointly desire to maintain such permitsas shared permits.(d) Continuance of the Outstanding Permits. Except as provided in any lease arrangement among the parties ortheir Affiliates with respect to any Required DPC Permits that are shared by DuPont and the applicable Transferred DPC Companies andtheir Subsidiaries, DuPont shall maintain and, to the extent applicable, timely apply for the renewal of any Outstanding Permits duringthe time period under which the Transferred DPC Companies have the right to operate under such8 Outstanding Permits pursuant to Section 5.29(c)(vii) above, after which time DuPont shall have no further obligations with respect toany Outstanding Permits.”SECTION 1.11 Operating Cash Amount; ATA Notes.(a) Section 5.5 of the Agreement is hereby amended by inserting the following new subsection (c) immediatelyfollowing subsection (b) thereof:"Exhibit HH attached hereto sets forth aggregate principal and interest that will be outstanding under each of the existingnotes that constitute DPC Indebtedness (each such existing note, an “ATA Note”) as of the Effective Time (after givingeffect to all prepayments of such ATA Notes planned to occur after 5 p.m. EST on January 29, 2013 but prior to theEffective Time (each a “Planned Prepayment”)). DuPont hereby agrees that except for Planned Prepayments,following 5 p.m. EST on January 29, 2013 it shall not, and shall cause its Subsidiaries not to, pay down or incur anyadditional principal amount or pay down any accrued but previously unpaid interest under any ATA Note, or incur anynew indebtedness between any Transferred DPC Company or its Subsidiaries, on the one hand, and DuPont and itsAffiliates that are not Transferred DPC Companies or their Subsidiaries, on the other hand (it being understood that thiscovenant shall be given retroactive effect from and after such time notwithstanding the fact that this Amendment isbeing entered into after such time). Except to the extent expressly provided in the immediately preceding sentence, theforegoing shall in no way restrict the right of DuPont or any of its Subsidiaries or Joint Ventures to declare and paydividends or distributions of, or otherwise transfer or advance (other than by payment of ATA Notes), Cash as permittedpursuant to the Purchase Agreement, including for the avoidance of doubt, the last paragraph of Section 5.1.(b) Annex A of the Agreement is hereby amended by amending and restating the definition of “Operating CashAmount” as follows:"Operating Cash Amount" shall mean, with respect to any Transferred DPC Company or Subsidiary thereof or JointVenture or Subsidiary thereof, the sum of (i) the amount set forth opposite the name of such entity on Section A(30) ofthe Seller's Disclosure Schedule and (ii) the aggregate amount in United States Dollars of any outstanding principal andaccrued but unpaid interest as of the Effective Time (the “ATA Note Amount”) under any ATA Note to which suchentity is a party as set forth on Exhibit II. For purposes of clause (ii) above, the applicable ATA Note9 Amount shall be converted into United States Dollars using the applicable Bloomberg Fixing Rate as of 11 a.m. EST onJanuary 31, 2013.SECTION 1.12 Purchase Price. Section 2.1 of the Agreement is hereby amended by inserting the following at the endof the last sentence of such section:"; provided, however, that any payments made pursuant to Article 5 of the Sale Agreement between DuPont deNemours (Deutschland) GmbH and Germany Coatings Co GmbH in respect of the sale of DuPont PerformanceCoatings GmbH (the “Germany Purchase Agreement”) shall be disregarded for purposes of this sentence. To the extentany such consideration is stated in local currency, for purposes of determining the portion of the Purchase Pricerepresented by such consideration, such consideration shall be converted into United States Dollars using the applicableBloomberg Fixing Rate as of 11 a.m. EST on January 31, 2013.”SECTION 1.13 Services Agreements.(a) Section 5.17(c) of the Agreement is hereby amended by deleting the term “Day One Operating Model” whereverit appears and substituting the term “Day One Support Model.”(b) Section 5.17(c)(ii) of the Agreement is hereby amended by adding the following text at the end of the paragraph:“The Parties shall cooperate after the Closing Date to amend the Services Agreements as follows: (1) the addition orsubstitution, as appropriate, of the eleven (11) SLAs that are attached hereto as Exhibit JJ; (2) the deletion of the two (2)SLAs that are attached hereto as Exhibit KK; (3) the replacement of the exhibit of each Services Agreement containingthe DPC Entity List with the DPC Entity List dated January 23, 2013, and attached hereto as Exhibit LL; and (4) thereplacement of the exhibit containing the Day One Support Model with the Day One Support Model dated January 29,2013, and attached hereto as Exhibit MM.”SECTION 1.14 Retained Names.(a) Section 5.7(a) of the Agreement is hereby amended by adding the following text immediately following"thirty (30) days" in the first sentence:10 "(or, if not reasonably possible in a particular jurisdiction based on Law or other requirements of a GovernmentalAuthority, ninety (90) days)"(b) Section 5.7(b)(v) of the Agreement is hereby amended by adding the following text immediatelypreceding "; and" at the end of the paragraph:"(provided that, to the extent permitted by Law, with respect to product and packaging the foregoing requirement shallnot apply where it would not be reasonably practicable to so comply and the invoice accompanying such product andpackaging includes a readily observable legend that such products are manufactured by or otherwise emanate from theTransferred DPC Companies and their Subsidiaries and the Joint Ventures and not from DuPont)"SECTION 1.15 Preliminary Purchase Price Adjustment. Section 2.3(a) of the Agreement is hereby amended byadding the following text at the end of the paragraph:“DuPont and Buyer hereby acknowledge and agree that, notwithstanding any delivery requirement pursuant to the firstsentence of this Section 2.3(a) (or actual delivery) prior to the date of this Amendment, that the Estimated Net WorkingCapital, Estimated Cash Amount and Estimated Indebtedness shall be as set forth on Exhibit NN, and delivery of suchExhibit shall satisfy in full DuPont’s obligations pursuant to this Section 2.3(a) without any further action on the part ofDuPont.”SECTION 1.16 Net Working Capital. The definition of “Net Working Capital of the DPC Business” set forth onAnnex A of the Agreement is hereby amended by adding the following sentence to the end of such definition:“Notwithstanding anything herein to the contrary, the definition of “Net Working Capital of the DPC Business” shallexclude any payables or receivables of the Transferred DPC Companies and their Subsidiaries to or from DuPont or anyof the Retained Subsidiaries pursuant to items 7 (re: inventory and goods in transit) and 11 (re: Germany PurchaseAgreement) of Section 5.5 of the Seller’s Disclosure Schedules).”SECTION 1.17 Indebtedness. The definition of “Indebtedness” set forth on Annex A of the Agreement is herebyamended by amending and restating clause (f) of such definition to read as follows:“(f) with respect to any and all interest rate or currency obligations, including swap, hedge or similar agreements, takencollectively, any11 aggregate accrued liability (as calculated in accordance with GAAP) minus any aggregate accrued assets (as calculated inaccordance with GAAP) associated therewith (which may be, for the avoidance of doubt, a negative value)".ARTICLE II MISCELLANEOUSSECTION 2.1 No Further Amendment. Except as otherwise provided herein, the Agreement shall remainunchanged and in full force and effect.SECTION 2.2 Effect of Amendment. From and after the date of this Amendment, any reference in the Agreementto "hereof", "herein", "hereunder", "hereby" and "this Agreement" shall be deemed a reference to the Agreement as amended by thisAmendment; provided, however, that any reference to the date of the Agreement, the use of the phrase "the date hereof" or "the dateof this Agreement" shall in all cases be a reference to August 30, 2012 and not the date of this Amendment.SECTION 2.3 Reservation of Rights. The Parties expressly agree that notwithstanding any claim, discussion or othercorrespondence between the parties or their Representatives prior to the Closing Date relating to whether any Intellectual Property thatis or is not as of the Closing DPC IP or licensed pursuant to the Intellectual Property License Agreement constitutes or shouldconstitute, or does not constitute or should not constitute, DPC IP or should or should not be licensed pursuant to the IntellectualProperty License Agreement, each of them reserves all rights under the Agreement and all Related Agreements with respect thereto.SECTION 2.4 Miscellaneous. The provisions contained in Sections 9.1, 9.2, 9.4, 9.6, 9.7, 9.9, 9.10, 9.11 and 9.14 ofthe Agreement are incorporated by reference in this Amendment mutatis mutandis.12 IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first above written.E. I. DU PONT DE NEMOURSAND COMPANYBy: /s/ George J. Duko Name: George J. DukoTitle: Manager, Mergers & AcquisitionsFLASH BERMUDA CO. LTD.By: /s/ Martin W. Sumner Name: Martin W. SumnerTitle: Director[Signature Page to Amendment to Purchase Agreement] ANNEX AExhibit 12 E. I. DU PONT DE NEMOURS AND COMPANY COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES(Dollars in millions) Years Ended December 31, 2012 2011 2010 2009 2008Income from continuing operations before income taxes $3,115 $3,781 $3,260 $1,943 $2,388Adjustment for companies accounted for by the equity method (8) (72) (74) (50) 6Less: Capitalized interest (37) (46) (38) (47) (49)Add: Amortization of capitalized interest 37 36 35 37 37 3,107 3,699 3,183 1,883 2,382Fixed charges: Interest and debt expense 464 447 590 408 376Capitalized interest 37 46 38 47 49Rental expense representative of interest factor 121 103 89 101 107 622 596 717 556 532Total adjusted earnings available for payment of fixed charges $3,729 $4,295 $3,900 $2,439 $2,914Number of times fixed charges earned 6.0 7.2 5.4 4.4 5.5Exhibit 21SUBSIDIARIES OF THE REGISTRANTSet forth below are certain subsidiaries ofE. I. du Pont de Nemours and Company Name Organized UnderLaws OfBelco Technologies Corporation DelawareChristiana Insurance, LLC VermontCoastal Training Technologies Corp. VirginiaDuPont Nutrition Biosciences ApS DenmarkDuPont (Australia) Ltd. AustraliaDuPont (Changshu) Fluoro Technology Co., Ltd. ChinaDuPont (China) Research & Development and Management Co., Ltd. ChinaDuPont (Korea) Inc. KoreaDuPont (U.K.) Industrial Limited United KingdomDuPont (U.K.) Ltd. United KingdomDuPont Acquisition, LLC DelawareDuPont Agricultural Caribe Industries, Ltd. BermudaDuPont Apollo (Shenzhen) Limited ChinaDuPont Argentina S.R.L. ArgentinaDuPont Asturias, S.L. SpainDuPont Capital Management Corporation DelawareDuPont Chemical and Energy Operations, Inc. DelawareDuPont China Holding Company Ltd. ChinaDuPont China Limited Hong KongDuPont Company (Singapore) Pte Ltd. SingaporeDuPont Coordination Center N.V. BelgiumDuPont de Nemours (Belgium) BVBA BelgiumDuPont de Nemours (Deutschland) GmbH GermanyDuPont de Nemours (France) S.A.S. FranceDuPont de Nemours (Luxembourg) SARL LuxembourgDuPont de Nemours (Nederland) B.V. The NetherlandsDuPont de Nemours Development S.A. SwitzerlandDuPont de Nemours Holding SA SwitzerlandDuPont de Nemours International S.A. SwitzerlandDuPont de Nemours Italiana S.r.l. ItalyDuPont Deutschland Holding GmbH & Co. KG GermanyDuPont do Brasil S.A. BrazilDuPont Electronics Microcircuits Industries, Ltd. BermudaDuPont Energy Company, LLC DelawareDuPont Global Operations, Inc. DelawareDuPont Integration, LLC DelawareDuPont Iberica, S.L. SpainName Organized UnderLaws OfDuPont International (Luxembourg) SCA LuxembourgDuPont International Operations SARL SwitzerlandDuPont Kabushiki Kaisha JapanDuPont KGA B.V. The NetherlandsDuPont Mexico S.A. de C.V. MexicoDuPont NLco BV The NetherlandsDuPont Operations (Luxembourg) SARL LuxembourgDuPont Operations Worldwide, Inc. DelawareDuPont Operations, Inc. DelawareDuPont Properties (Luxembourg) S.A.R.L LuxembourgDuPont Quimica de Venezuela, C.A. VenezuelaDuPont Taiwan Limited TaiwanDuPont Technology (Luxembourg) S.a.r.l. LuxembourgDuPont Trading (Shanghai) Co., Ltd. ChinaE.I. DuPont Canada – Thetford Inc. CanadaE.I. DuPont Canada Company CanadaE.I. DuPont India Private Limited IndiaEKC Technology, Inc. CaliforniaFirst Chemical Corporation MississippiHolding DuPont S.A. de C.V. MexicoHowson Algraphy BV The NetherlandsInitiatives de Mexico, S.A. de C.V. MexicoInnovalight Inc. DelawareMECS Inc. DelawarePioneer Hi-Bred International, Inc. IowaSolae L.L.C. DelawareSubsidiaries not listed would not, if considered in the aggregate as a single subsidiary, constitute a significant subsidiary.Exhibit 23CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMWe hereby consent to the incorporation by reference in the Registration Statements on Form S-3 (No. 333-173217); and Form S-8 (Nos. 033-51817, 333-60069, 333-106527, 333-114330, 333-118042, 333-129494, 333-129495, 333-129496, 333-144083, 333-145038, 333-147452, 333-150605, 333-164987,333-164988 and 333-164989) of E. I. du Pont de Nemours and Company of our report dated February 6, 2013 relating to the financial statements, financialstatement schedule and the effectiveness of internal control over financial reporting, which appears in this Form 10-K./s/ PricewaterhouseCoopers LLPPricewaterhouseCoopers LLPPhiladelphia, PennsylvaniaFebruary 6, 2013Exhibit 31.1CERTIFICATIONSI, Ellen J. Kullman, certify that:1.I have reviewed this report on Form 10-K for the period ended December 31, 2012 of E. I. du Pont de Nemours and Company;2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by thisreport;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within thoseentities, particularly during the period in which this report is being prepared;b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; andd)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recentfiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely tomaterially affect, the registrant's internal control over financial reporting; and5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the registrant's ability to record, process, summarize and report financial information; andb)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controlover financial reporting. Date: February 6, 2013 By: /s/ ELLEN J. KULLMAN Ellen J. Kullman Chief Executive Officer andChair of the BoardExhibit 31.2CERTIFICATIONSI, Nicholas C. Fanandakis, certify that:1.I have reviewed this report on Form 10-K for the period ended December 31, 2012 of E. I. du Pont de Nemours and Company;2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in ExchangeAct Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for theregistrant and have:a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within thoseentities, particularly during the period in which this report is being prepared;b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision,to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes inaccordance with generally accepted accounting principles;c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectivenessof the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; andd)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscalquarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect,the registrant's internal control over financial reporting; and5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likelyto adversely affect the registrant's ability to record, process, summarize and report financial information; andb)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control overfinancial reporting. Date: February 6, 2013 By: /s/ NICHOLAS C. FANANDAKIS Nicholas C. Fanandakis Executive Vice President andChief Financial OfficerExhibit 32.1Certification of CEO Pursuant to18 U.S.C. Section 1350,As Adopted Pursuant toSection 906 of the Sarbanes-Oxley Act of 2002In connection with the Annual Report of E. I. du Pont de Nemours and Company (the "Company") on Form 10-K for the period ending December 31, 2012 asfiled with the Securities and Exchange Commission on the date hereof (the "Report"), Ellen J. Kullman, as Chief Executive Officer of the Company, herebycertifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:(1)The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; and(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. /s/ ELLEN J. KULLMAN Ellen J. KullmanChief Executive Officer February 6, 2013Exhibit 32.2Certification of CFO Pursuant to18 U.S.C. Section 1350,As Adopted Pursuant toSection 906 of the Sarbanes-Oxley Act of 2002In connection with the Annual Report of E. I. du Pont de Nemours and Company (the "Company") on Form 10-K for the period ending December 31, 2012 asfiled with the Securities and Exchange Commission on the date hereof (the "Report"), Nicholas C. Fanandakis, as Chief Financial Officer of the Company,hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:(1)The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; and(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. /s/ NICHOLAS C. FANANDAKIS Nicholas C. FanandakisChief Financial Officer February 6, 2013Exhibit 95MINE SAFETY DISCLOSURESThe company owns and operates a surface mine near Starke, Florida. The following table provides information about citations, orders and notices issuedfrom the Mine Safety and Health Administration (MSHA) under the Federal Mine Safety and Health Act of 1977 (Mine Act) for the year ended December 31,2012.Mine (MSHA Identification Number)Section 104 S&S1 Citations (#)Section104(b) Orders (#)Section104(d) Citations and Orders (#)Section 110(b)(2) Violations (#)Section 107(a) Orders (#)TotalDollar Value of MSHA Assessments Proposed ($)Total Number of Mining Related Fatalities (#)Received Notice of Pattern of Violations Under Section 104(e) (yes/no)Received Notice of Potential to Have Pattern Under Section 104(e) (yes/no)Legal Actions Pending as of Last Day of Period (#)Legal Actions Initiated During Period (#)Legal Actions Resolved During Period (#)Starke, FL (0800225)16———12 $35,138—NoNo43 523 1. S&S refers to significant and substantial violations of mandatory health or safety standards under section 104 of the Mine Act.2. On February 8, 2012, the company received an imminent danger order under Section 107(a) of the Mine Act. In December 2012, the order was vacated by the Federal Mine Safetyand Health Review Commission (FMSHRC), noting there was no imminent danger when the order was issued.3. Four legal actions were pending before the FMSHRC involving the company’s contest of proposed penalties related to citations issued in 2012. In 2012, two legal actions wereresolved which resulted in the following: i) the imminent danger order received by the company was vacated as noted above and ii) 8 S&S designations from citations issued in 2011were deleted.

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