JPMorgan - KASE

(f)
On March 31, 2000, also in connection with the acquisition of ShNOS, the Corporation issued
Corresponding Convertible Securities as follows:
i. Options to purchase 1,105,753 Common Shares of the Corporation at prices and terms
which are identical to those options outstanding at March 31, 2000, but in each case the
number of options equals 41.16% of the outstanding options. This percentage was
changed to 40.80% of the outstanding options granted prior to March 31, 2000.
ii.
Warrants to purchase 2,037,420 Common Shares of the Corporation at $6.25 per share
under the same terms as the Series 5 Warrants which were outstanding at March 31,
2000. As at December 31, 2000, 2,035,453 of these warrants are outstanding. On
February 23, 2001, 906 of these corresponding convertible securities were exercised and
all the remaining 2,034,547 were redeemed under the same terms as the Series 5
warrants at C$2.90 per corresponding convertible security for the total consideration of
$3.878 million. As at December 31, 2001 there were no outstanding corresponding
convertible securities associated with the Series 5 warrants.
(g) The Corporation cancelled 153,657 of the shares issued for the acquisition of ShNOS to
correct an error made upon issuance.
(h) A summary of the status of the Corporation’s stock option plan as of December 31, 2000 and
the changes during the years ended December 31, 2001 is presented below (expressed in
Canadian dollars):
Number of
Shares
Weighted Average
Exercise Price
Outstanding at December 31, 1999 .................................... 2,861,500 2.94
Granted............................................................ 3,990,000 3.31
Granted under corresponding securities arrangement .................... 1,105,763 2.16
Exercised ........................................................... (2,447,610) 1.29
Cancelled .......................................................... (823,948) 3.77
Outstanding at December 31, 2000 .................................... 4,685,705 3.15
Granted............................................................ 1,644,243 9.71
Granted under corresponding securities arrangement .................... — —
Exercised ........................................................... (446,568) 2.28
Cancelled .......................................................... (146,500) 7.89
Outstanding at December 31, 2001 .................................... 5,736,880 3.07
All stock options outstanding as of August 3, 2001 were re-priced in connection with the special
dividend that was issued by the Corporation. The exercise price was reduced by C$3.78 per share.
Certain options had exercise prices less than C$3.78. For these options, the Corporation recorded
the cash payable upon exercise of $0.558 million as a dividend.
Range of
Exercise Price
Number
Outstanding
Weighted
Average
Remaining
Contractual
Life
As at December 31, 2001
Weighted
Average
Exercise
Price
Number
Exercisable
Weighted
Average
Exercise
Price
Weighted
Average
Remaining
Contractual
Life
0 to 2.5 3,755,426 3.09 0.36 3,549,176 0.42 3.12
2.5 to 7.5 578,711 3.43 5.54 169,348 5.22 1.84
7.5 to 12.5 1,402,743 4.61 9.32 600,000 9.71 4.87
0 to 12.5 5,736,880 3.48 3.07 4,318,524 1.90 3.31
F-37