Document:

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                                                             Exhibit 10.14.34

                  SECOND AMENDMENT TO LETTER OF CREDIT FACILITY
                           AND REIMBURSEMENT AGREEMENT

         THIS SECOND AMENDMENT TO LETTER OF CREDIT FACILITY AND REIMBURSEMENT
AGREEMENT, dated as of November 28 , 2000 (this "Amendment"), by and among XL
Insurance Ltd, XL Capital Ltd, XL Europe Ltd, XL Mid Ocean Reinsurance Ltd, XL
Brockbank Group plc and XL Investments Ltd (collectively, the "XL Parties") and
Mellon Bank, N.A., as Issuing Bank (in such capacity, the "Issuing Bank") and as
Agent ( in such capacity, the "Agent") and as a Bank (in such capacity, the
"Bank").

                              W I T N E S S E T H:
                              - - - - - - - - - -

         WHEREAS, the XL Parties, the Bank, the Issuing Bank and the Agent are
parties to a Letter of Credit Facility and Reimbursement Agreement, dated as of
June 30, 1999, as amended by the First Amendment to Letter of Credit Facility
and Reimbursement Agreement, dated February 25, 2000 (the "Reimbursement
Agreement"), pursuant to which the Bank has agreed, on the terms and subject to
the conditions described therein, to extend credit to certain of the XL Parties
by participating in letters of credit issued for the account of such XL Parties
by the Issuing Bank;

         WHEREAS, pursuant to a Transfer Supplement dated as of the date hereof,
each of the original Bank parties to the Reimbursement Agreement (other than the
Bank) has assigned all of its rights and obligations under the Reimbursement
Agreement and the other Transaction Documents (including, without limitation,
all of its Letter of Credit Participating Interest Commitments and Letter of
Credit Participating Interests) to the Bank in accordance with Section 9.13(c)
of the Reimbursement Agreement;

         WHEREAS, the XL Parties have requested the Bank to make certain
additional changes to the Reimbursement Agreement;

         WHEREAS, the Bank is willing to amend the Reimbursement Agreement as
set forth below; and

         WHEREAS, capitalized terms used herein and not otherwise defined shall
have the meanings assigned to them in the Reimbursement Agreement;

         NOW THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, and intending to be legally bound hereby, the
parties hereto agree as follows:

<PAGE>

         SECTION 1. AMENDMENTS TO REIMBURSEMENT AGREEMENT.

         (a) The definition of the term "Qualifying Pledged Securities"
appearing in Section 1.01 of the Reimbursement Agreement is hereby amended by
deleting the words "a twenty percent or lower risk capital weighting" appearing
therein and by inserting in lieu thereof the words "a zero percent risk capital
weighting".

         (b) Sections 5.01 through 5.10 of the Reimbursement Agreement are
hereby deleted in their entirety and the following new Section 5.01 is inserted
in lieu thereof:

                  5.01 INCORPORATION OF AFFIRMATIVE COVENANTS BY REFERENCE. Each
         XL Party shall observe, perform and fulfill, for the benefit of the
         Issuing Bank and the Banks, each of the covenants, agreements and
         obligations contained in Article VI of the July 2000 Letter of Credit
         Agreement (as defined below). For purposes of this Section 5.01, the
         aforesaid Article VI of the July 2000 Letter of Credit Agreement,
         together with the other sections of the July 2000 Letter of Credit
         Agreement to which reference is made therein, and related definitions,
         schedules and ancillary provisions, are hereby incorporated herein by
         reference, MUTATIS MUTANDIS, and will be deemed to continue in effect
         for the benefit of the Issuing Bank and the Banks, as if each Bank were
         a "Lender" under the July 2000 Letter of Credit Agreement, whether or
         not the July 2000 Letter of Credit Agreement remains in effect among
         the parties thereto. As used in this Agreement, the term "July 2000
         Letter of Credit Agreement" means the Letter of Credit and
         Reimbursement Agreement, dated as of July 5, 2000, between XL Capital,
         X.L. America, Inc., XL Insurance, XL Europe and XL Mid Ocean, the
         Lender party thereto and The Chase Manhattan Bank as Administrative
         Agent, as in effect on November 27, 2000, without regard to any
         amendment thereto after such date other than any such amendment to
         which the Agent shall have consented in writing with reference to this
         Agreement.

         (c) Sections 6.01 through 6.10 of the Reimbursement Agreement are
hereby deleted in their entirety and the following new Section 6.01 is inserted
in lieu thereof:

                  6.01 INCORPORATION OF NEGATIVE COVENANTS BY REFERENCE. Each XL
         Party shall observe, perform and fulfill, for the benefit of the
         Issuing Bank and the Banks, each of the covenants, agreements and
         obligations contained in Article VII of the July 2000 Letter of Credit
         Agreement. For purposes of this Section 6.01, the aforesaid Article VII
         of the July 2000 Letter of Credit Agreement, together with the other
         sections of the July 2000 Letter of Credit Agreement to which reference
         is made therein, and related definitions, schedules and ancillary
         provisions, are hereby incorporated herein by reference, MUTATIS
         MUTANDIS, and will be deemed to continue in effect for the benefit of
         the Issuing Bank and the Banks, as if each Bank were a "Lender" under
         the July 2000 Letter of Credit Agreement, whether or not the July 2000
         Letter of Credit Agreement remains in effect among the parties thereto.

         (d) Section 7.01(e) of the Reimbursement Agreement is hereby amended to
read in its entirety as follows:

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                  (e) any Credit Party or any Subsidiary of any Credit Party
         shall default (i) in any payment of principal of or interest on any
         other obligation for borrowed money in principal amount of $50,000,000
         or more, or any payment of any principal amount of $50,000,000 or more
         under Hedging Agreements (as defined in the July 2000 Letter of Credit
         Agreement), in each case beyond any period of grace provided with
         respect thereto, or (ii) in the performance of any other agreement,
         term or condition contained in any such agreement (other than Hedging
         Agreements) under which any such obligation in principal amount of
         $50,000,000 or more is created, if the effect of such default is to
         cause or permit the holder or holders of such obligation (or trustee on
         behalf of such holder or holders) to cause such obligation to become
         due prior to its stated maturity or to terminate its commitment under
         such agreement, PROVIDED that this clause (e) shall not apply to
         secured Indebtedness that becomes due as a result of the voluntary sale
         or transfer of the property or assets securing such Indebtedness;

         (e) Section 7.01(f) of the Reimbursement Agreement is hereby amended to
read in its entirety as follows:

                  (f) one or more judgments for the payment of money in an
         aggregate amount in excess of $100,000,000 shall be rendered against
         any Credit Party or any of its Subsidiaries or any combination thereof
         and the same shall not have been vacated, discharged, stayed (whether
         by appeal or otherwise) or bonded pending appeal within 45 days from
         the entry thereof;

         SECTION 2. REDUCTION OF LETTER OF CREDIT PARTICIPATING INTEREST
COMMITTED AMOUNT. The Letter of Credit Participating Interest Committed Amount
of the Bank is hereby reduced to $138,607,449.20. The XL Parties hereby
irrevocably agree and direct that the Letter of Credit Participating Interest
Committed Amount of the Bank shall be further reduced from time to time,
concurrently with the cancellation of or drawing under any Letter of Credit, to
the Aggregate Letter of Credit Undrawn Availability at such time. The effect and
intention of the foregoing is that, from and after the date of this Amendment,
the Issuing Bank shall have no further obligation to issue any Letter of Credit
under the Reimbursement Agreement. In addition, the XL Parties agree that, from
and after the date of this Amendment, the Issuing Bank shall have no obligation
to extend the expiration date of any Letter of Credit, permit the extension of
the expiration date of any Letter of Credit, increase the stated amount of any
Letter of Credit or issue any other amendment to any Letter of Credit.

         SECTION 3. CONDITIONS TO EFFECTIVENESS. This Second Amendment shall
become effective upon (i) the execution and delivery hereof by the XL Parties,
the Bank, the Issuing Bank and the Agent, (ii) the execution and delivery by the
parties thereof of the Second Amendment to the Pledge Agreement dated as of the
date hereof and (iii) payment to the Bank in immediately available funds,
concurrently with delivery by the XL Parties of this Amendment, of an amendment
fee in the amount of $25,000. It is understood that the Bank does not intend to

<PAGE>

execute or deliver this Amendment unless the Letters of Credit listed on Exhibit
A hereto are the only Letters of Credit outstanding under the Reimbursement
Agreement.

         SECTION 4. EFFECT OF AMENDMENT. The Reimbursement Agreement, as amended
by this Amendment, is in all respects ratified, approved and confirmed and
shall, as so amended, remain in full force and effect.

         SECTION 5. GOVERNING LAW. This Amendment shall be deemed to be a
contract under the laws of the Commonwealth of Pennsylvania and for all purposes
shall be governed by and construed and enforced in accordance with the laws of
said Commonwealth.

         SECTION 6. COUNTERPARTS. This Amendment may be executed in any number
of counterparts and by the different parties hereto on separate counterparts,
each of which, when so executed, shall be deemed an original, but all such
counterparts shall constitute but one and the same instrument.

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         IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the date first above written.

XL INSURANCE LTD, AS AN ACCOUNT PARTY AND A GUARANTOR

By:  /s/ CHRISTOPHER COELHO
   -----------------------------------------------------------
      (Signature)
Name:  CHRISTOPHER COELHO
     ---------------------------------------------------------
Title:  CHIEF FINANCIAL OFFICER
      --------------------------------------------------------

XL MID OCEAN REINSURANCE LTD, AS AN ACCOUNT PARTY AND A GUARANTOR

By:  /s/ JOHN H. HUME
   -----------------------------------------------------------
      (Signature)
Name:  JOHN H. HUME
     ---------------------------------------------------------
Title:  SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER

XL EUROPE LTD, AS AN ACCOUNT PARTY

By:  /s/ J. WALKER RAINEY
    ----------------------------------------------------------
       (Signature)
Name:  J. WALKER RAINEY
     ---------------------------------------------------------
Title:  CHIEF FINANCIAL OFFICER
      --------------------------------------------------------

XL BROCKBANK GROUP PLC, AS AN ACCOUNT PARTY

By:  /s/ N. J. METCALF
   ----------------------------------------------------------
      (Signature)
Name:  N. J. METCALF
     ---------------------------------------------------------
Title:  CHIEF EXECUTIVE
      --------------------------------------------------------

XL INVESTMENTS LTD, AS A GUARANTOR

By:  /s/ PAUL S. GIORDANO
   -----------------------------------------------------------
      (Signature)
Name:  /s/ PAUL S. GIORDANO
     ---------------------------------------------------------
Title:  SECRETARY
      --------------------------------------------------------

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XL CAPITAL LTD, AS AN ACCOUNT PARTY AND A GUARANTOR

By:  /s/ PAUL S. GIORDANO
   -----------------------------------------------------------
      (Signature)
Name:  /s/ PAUL S. GIORDANO
     ---------------------------------------------------------
Title:  SECRETARY
      --------------------------------------------------------

MELLON BANK, N.A., AS A BANK, AS ISSUING BANK AND AS AGENT

By:  /s/ KARLA K. MALOOF
   -----------------------------------------------------------
      (Signature)
Name:  KARLA K. MALOOF
     ---------------------------------------------------------
Title:  VICE PRESIDENT
      --------------------------------------------------------<PAGE>
                                                              Exhibit 10.16.1
                               724 SOLUTIONS INC.

                   AMENDED AND RESTATED 1997 STOCK OPTION PLAN

                                FEBRUARY 2, 2000

          WHEREAS 724 Solutions Inc. (the "Corporation") adopted a stock option
plan (the "Plan") on September 22, 1997 to provide a meaningful opportunity for
employees, officer, directors and advisors of the Corporation and its affiliates
to acquire options to purchase common shares in the capital of the Corporation
(the "Common Shares");

          AND WHEREAS the Corporation amended the Plan effective June 1, 1999 to
increase the maximum number of Common Shares issuable under the Plan from
1,000,000 to 1,250,000;

          AND WHEREAS the Corporation amended the Plan effective October 28,
1999 to increase the maximum number of Common Shares issuable under the Plan
from 1,250,000 to 1,500,000;

          AND WHEREAS the Corporation amended the Plan effective December 20,
1999 to increase the maximum number of Common Shares issuable under the Plan
from 1,500,000 to 1,600,000;

          AND WHEREAS the Corporation amended the Plan on December 30, 1999 to
account for the subdivision of the Common Shares on a two-for-one basis;

          AND WHEREAS the Corporation completed an initial public offering on
February 2, 2000 which affects the applicability of some of the provisions of
the Plan;

          AND WHEREAS the sole purpose of this amendment is to reflect the
aforementioned amendments and restate the Plan as follows:

1.        INTERPRETATION.  In this Plan, the following terms shall have the
following meanings:

          (a)  "ADMINISTRATORS" means the Board or any committee of the Board so
               designated by the Board to administer the Plan;

          (b)  "AFFILIATE" means any corporation which is an affiliate, as such
               term is used in Subsection 1(2) of the Securities Act (Ontario),
               of the Corporation;

          (c)  "ASSOCIATE" means any person which is an associate, as such term
               is used in Subsection 1(1) of the Securities Act (Ontario), of
               the Corporation;

          (d)  "BOARD" means the Board of Directors of the Corporation;

          (e)  "BUSINESS" means the business of the Corporation, being the
               business of designing, developing, marketing, licensing and
               supporting Internet-based
<PAGE>

               electronic banking applications over a variety of access
               platforms, which is currently carried on by the Corporation in
               North America;

          (f)  "COMPETITOR" means any person or entity or any Affiliate or
               Associate of such person or entity: (i) who carries on the
               Business; and (ii) who competes materially with the Corporation
               as determined by the Board acting reasonably;

          (g)  "CONTROL": a company shall be deemed to be controlled by another
               person or company or by two or more companies if:

               (i)  voting securities of the first-mentioned company carrying
                    more than 50% of the votes for the election of directors are
                    held, otherwise than by way of security only, by or for the
                    benefit of the other person or company or by or for the
                    benefit of the other companies; and

               (ii) the votes carried by such securities are entitled, if
                    exercised, to elect a majority of the board of directors of
                    the first-mentioned company,

               and "CONTROLLED" shall have a corresponding meaning;

          (h)  "CORPORATION" means 724 Solutions Inc. and its successors;

          (i)  "ELIGIBLE PARTICIPANT" means:

               (i)  any director, officer or employee of, or advisor to, the
                    Corporation or any Affiliate (an "Eligible Individual"); or

               (ii) a Personal Holding Corporation; or

               (iii) a Trust;

          (j)  "EVENT OF TERMINATION" means:

               (i)  the voluntary or involuntary termination of employment,
                    retirement or leaving of employment with the Corporation or
                    an Affiliate (except for the purpose of entering into
                    employment with the Corporation or an Affiliate), whether
                    with or without cause, and includes termination of
                    employment arising from the disability or the death of an
                    Eligible Individual; or

               (ii) an Eligible Individual ceasing to be a director or officer
                    of or advisor to the Corporation or any Affiliate (unless
                    such individual otherwise remains an Eligible Individual);
                    or

              (iii) a corporate Eligible Participant ceasing to be a Personal
                    Holding Corporation; or
<PAGE>

               (iv) the Affiliate in respect of which the Eligible Individual is
                    a director, officer, employee or advisor ceases to be an
                    Affiliate of the Corporation.

               For greater certainty, the provisions of Section 16 of this Plan
               shall apply with respect to Options held by a Personal Holding
               Corporation or Trust of the Eligible Individual to whom the Event
               of Termination relates.

          (k)  "EXERCISED OPTIONEE" means a person who has exercised an option
               and fully paid for Shares purchased in accordance with the Plan.

          (l)  "MARKET PRICE" at any date in respect of the Shares means the
               closing sale price or weighted average trading price (as
               determined by the Administrators with the consent of The Toronto
               Stock Exchange (the "TSE") or The Nasdaq Stock Market, Inc., if
               required) of the Shares on the TSE or the Nasdaq National Market
               as determined by the Administrators (or, if such Shares are not
               then listed and posted for trading on the TSE or the Nasdaq
               National Market, on any such stock exchange or stock market in
               Canada or the United States on which such Shares are listed and
               posted for trading as may be selected for such purpose by the
               Board) on the last trading day immediately preceding such date.
               In the event that such Shares are not listed and posted for
               trading on the TSE, any stock exchange or stock market, the
               Market Price shall be the fair market value of such Shares as
               determined by the Board in its sole discretion;

          (m)  "OPTION" means an option granted to a Participant under the Plan
               to purchase Shares;

          (n)  "OPTIONED SHARES" means the Shares issuable pursuant to an
               exercise of Options;

          (o)  "PARTICIPANT" means such Eligible Participants as are granted or
               hold options to purchase shares by the Administrators pursuant to
               the Plan and includes the relevant Eligible Individual with
               respect to Options held by a Personal Holding Corporation or
               Trust;

          (p)  "PERSONAL HOLDING CORPORATION" means a corporation Controlled by
               an Eligible Individual, the issued and outstanding shares of
               which are, and will continue to be, beneficially owned, directly
               or indirectly, only by such Eligible Individual and/or the
               spouse, children and/or grandchildren of such Eligible
               Individual;

          (q)  "PLAN" means this 724 Solutions Inc. Amended and Restated Stock
               Option Plan, as it may be further amended from time to time;

          (r)  "RESERVED FOR ISSUANCE" refers to Shares which may be issued in
               the future upon the exercise of Options which have been granted;
<PAGE>

          (s)  "SHARE COMPENSATION ARRANGEMENT" means a stock option, stock
               option plan, employee stock purchase plan or any other
               compensation or incentive mechanism of the Corporation involving
               the issuance or potential issuance of Shares to Eligible
               Individuals, including a share purchase from treasury which is
               financially assisted by the Corporation by way of a loan,
               guarantee or otherwise;

          (t)  "SHARES" means the common shares of the Corporation;

          (u)  "TRUST" means a trust governed by a registered retirement savings
               plan established by and solely for the benefit of an Eligible
               Individual and "TRUSTEE" shall mean the trustee in respect of the
               Trust;

          (v)  "UNVESTED OPTIONS" means Options which have not yet become
               exercisable by a Participant to purchase Shares; and

          (w)  "VESTED OPTIONS" means options which have become exercisable by a
               Participant to purchase Shares.

2.        PURPOSE.  The purpose of the Plan is to advance the interests of the
Corporation and its shareholders by providing to the directors, officers and
employees of, and advisors to, the Corporation and its Affiliates a performance
incentive for continued and improved service with the Corporation and its
Affiliates and by enhancing such persons' contribution to increased profits by
encouraging capital accumulation and share ownership.

3.        SHARES SUBJECT TO THE PLAN.  Options may be granted in respect of
authorized and unissued Shares, provided that the aggregate number of Shares
reserved for issuance upon the exercise of all Options granted under the Plan,
subject to any adjustment of such number pursuant to the provisions of Section
15 hereof, shall not exceed 3,200,000 (including any Shares reserved for
issuance upon the exercise of all Options granted under any U.S. Share
Compensation Arrangement), or such greater number of Shares as may be determined
by the Board and approved by any relevant stock exchange or other regulatory
authority and, if required, by all or a specified majority of the shareholders
of the Corporation. Optioned Shares which are not purchased as a result of
Options having terminated or expired without being fully exercised shall not be
counted for purposes of the foregoing and shall be available for subsequent
Options. No fractional Shares may be purchased or issued under the Plan.

4.        ADMINISTRATION OF THE PLAN.  The Plan shall be administered by the
Administrators. Subject to the provisions hereof, the Administrators shall have
the power and authority to:

          (a)  adopt policies, rules and regulations and prescribe forms and
               procedures for implementing the Plan;

          (b)  determine the eligibility of persons to participate in the Plan,
               when Options to Eligible Persons shall be granted, the number of
               Shares
<PAGE>

               subject to each Option, the vesting period and, subject to
               Section 10 hereof, the expiry date for each Option;

          (c)  interpret and construe the provisions of the Plan;

          (d)  subject to regulatory requirements, make exceptions to the Plan
               in circumstances which they determine to be exceptional;

          (e)  delegate any or all of their power and authority under (a), (b),
               (c) and (d) above to such persons or groups of persons on such
               terms and on such conditions as the Administrators may in their
               absolute discretion determine; and

          (f)  take such other steps as they determine to be necessary or
               desirable to give effect to the Plan.

Any decision, approval or determination made by a person or group of persons
delegated the ability to make such decision, approval or determination pursuant
to paragraph (e) above shall be deemed to be a decision, approval or
determination, as the case may be, of the Administrators.

5.        AGREEMENT.  All Options granted hereunder shall be evidenced by an
agreement between the Corporation and the Participant substantially in the form
of Schedule 1.

          The Administrators may, in their discretion, require as conditions to
the grant or exercise of any Option that the Participant (including any Personal
Holding Corporation or Trustee) shall have:

          (a)  represented, warranted and agreed in form and substance
               satisfactory to the Corporation that he or she is acquiring and
               will acquire such Option and the Shares to be issued upon the
               exercise thereof or, as the case may be, is acquiring such
               Shares, for his or her own account, for investment and not with a
               view to or in connection with any distribution, that he or she
               has had access to such information as is necessary to enable him
               or her to evaluate the merits and risks of such investment and
               that he or she is able to bear the economic risk of holding such
               Shares for an indefinite period;

          (b)  agreed to restrictions on transfer in form and substance
               satisfactory to the Corporation and to an endorsement on any
               option agreement or certificate representing the Shares making
               appropriate reference to such restrictions; and

          (c)  agreed to indemnify the Corporation in connection with the
               foregoing.

6.        GRANT OF OPTIONS.  Subject to the terms of the Plan, the
Administrators may, from time to time, grant Options to Participants to purchase
that number of Shares that the Administrators, in their absolute discretion,
determine. No person shall enjoy any
<PAGE>

part of the rights or privileges of a holder of Shares subject to Options until
that person becomes an Exercised Optionee.

7.        RETIREMENT SAVINGS PLANS.  Eligible Individuals may, in their sole
discretion, elect to have some or all of any Options to be granted to them to
instead be granted to a Trust governed by a registered retirement savings plan
established by and for the benefit of such Participant. Such election must be
made prior to the execution of the agreement described in Section 5 and shall
be evidenced in such agreement and in the option confirmation described in
Section 12. For the purposes of this Plan, Options held by Trusts established
for the benefit of the Eligible Individual shall be considered to be held by
that Eligible Individual.

8.        PERSONAL HOLDING CORPORATION.  Eligible Individuals may, in their sole
discretion, elect to have some or all of any Options to be granted to them to
instead be granted to a Personal Holding Corporation Controlled by that
Participant. Such election must be made prior to the execution of the agreement
described in Section 5 and shall be evidenced in such agreement and shall be
evidenced in the option confirmation described in Section 12. For the purposes
of this Plan, Options held by the Personal Holding Corporation of an Eligible
Individual shall be considered to be held by that Eligible Individual. Any
Options held by the Personal Holding Corporation of a Participant shall
terminate and be void and of no further effect as to all Shares purchaseable
thereunder on the date which is 30 days after the date on which that Eligible
Individual ceases to Control that corporation or the date that corporation
otherwise ceases to be a Personal Holding Corporation of that Eligible
Individual, as provided in Section 16. Provided, however, that if a Personal
Holding Corporation ceases to qualify as such solely as a result of the death of
the Eligible Individual in question, such Options shall remain exercisable on
the terms and subject to the conditions set out herein as if such Options had
been held directly by the deceased MUTATIS MUTANDIS, and provided further that
such Personal Holding Corporation continues to qualify as such but for the death
of the Eligible Individual in question.

9.        EXERCISE PRICE.  Subject to Section 15, the exercise price per Share
shall be not less than the Market Price per Share on the date the grant of the
Option is approved.

10.       TERM OF OPTION.  The term of each Option shall be determined by the
Administrators, provided that no Option shall be exercisable after 10 years from
the date on which it is granted.

11.       SHARES AVAILABLE FOR PURCHASE.  The Shares subject to each Option
shall become available for purchase by the Participant on the date or dates
determined by the Administrators when the Option is granted.

12.       OPTION CONFIRMATION.  Upon the grant of each Option, a stock option
confirmation, substantially in the form of Schedule 2, shall be delivered by the
Administrators to the Eligible Individual in question. The stock option
confirmation shall indicate the number of Options, if any, which the Participant
has elected to have granted directly, to a Trust or Trusts, or to a Personal
Holding Corporation or Personal Holding Corporations.
<PAGE>

13.       EXERCISE OF OPTION.  Subject to Section 11, an Option may be exercised
at any time, or from time to time, during its term as to any number of whole
Shares which are then available for purchase; provided that no partial exercise
may be for less than 100 whole Shares, unless such exercise is with respect to
the entire Option balance held by the Participant. A Participant electing to
exercise an Option on his or her own behalf or on behalf of a Trust or Personal
Holding Corporation shall give written notice of the election to the
Administrators, substantially in the form of Schedule 3 or in any other form
acceptable to the Administrators. The aggregate amount to be paid for the Shares
to be acquired pursuant to the exercise of an Option shall accompany the written
notice.

          Upon actual receipt by the Administrators of written notice and a
certified cheque or bank draft for the aggregate exercise price, the appropriate
number of Optioned Shares shall be issued and registered in the name of the
Participant exercising the Option (including the Trustee, in the case of the
exercise of Options by a Trust) and in issuing such Optioned Shares, the
Corporation shall be deemed to represent to the Participant exercising the
Option as of the date of such exercise that the Corporation is validly existing
under the BUSINESS CORPORATIONS ACT (Ontario), has not been dissolved and no
proceedings have been taken or authorized by the Corporation or by any other
person with respect to the bankruptcy, insolvency, liquidation, dissolution or
winding-up of the Corporation or, except as publicly disclosed, with respect to
any merger, consolidation, arrangement or reorganization relating to the
Corporation.

          Notwithstanding any of the provisions of the Plan or any Option or
Agreement, the Corporation's obligation to issue Shares to a Participant
pursuant to the exercise of any Option shall be subject to:

          (a)  completion of such registration or other qualification of such
               Shares or obtaining approval of such governmental or regulatory
               authority as the Corporation shall determine to be necessary or
               advisable in connection with the authorization, issuance or sale
               thereof;

          (b)  the admission of such Shares to listing on any stock exchange on
               which the Shares may then be listed;

          (c)  the receipt from the Optionee of such representations,
               warranties, agreements and undertakings as the Corporation
               determines to be necessary or advisable in order to safeguard
               against the violation of the securities laws of any jurisdiction;
               and

          (d)  any other reasonable procedures as prescribed by the Corporation
               from time to time.

14.       TAXATION.  The Corporation or any Affiliate may take such steps as are
considered necessary or appropriate for the withholding of any taxes which the
Corporation or the Affiliate, as the case may be, is required by any law or
regulation of any governmental authority whatsoever to withhold in connection
with any Option or Share including, without limiting the generality of the
foregoing, the withholding of all or any portion of any payment or the
withholding of the issue of Shares to be issued upon the exercise of any Option,
until such time as the Optionee has paid the Corporation or the
<PAGE>

Affiliate for any amount which the Corporation or the Affiliate is required to
withhold with respect to such taxes.

15.       CERTAIN ADJUSTMENTS.  Appropriate adjustments as regards Options
granted or to be granted, in the number of Shares which are available for
purchase and/or in the purchase price for such Shares under the Plan and to the
maximum number of Shares available for issuance under the Plan shall be made by
the Board to give effect to the number of Shares of the Corporation resulting
from subdivisions, consolidations or reclassifications of the Shares, the
payment of stock dividends by the Corporation (other than dividends in the
ordinary course) or other changes in the capital stock of the Corporation which
the Board may, in its discretion, consider relevant for purposes of ensuring
that the rights of the Participants are not prejudiced thereby (including
amalgamations, mergers, reorganizations, liquidations and similar material
transactions), subject to the approval, if required, of any stock exchange on
which the securities of the Corporation may be listed. If: (a) the Corporation
proposes to enter into a transaction contemplated in Subsection 182(1) of the
BUSINESS CORPORATIONS ACT (Ontario); (b) the Corporation proposes to make an
issuer bid for all or substantially all holders of shares or proposes to enter
into a merger, amalgamation or other corporate arrangement or reorganization or
to liquidate, dissolve or wind-up; (c) an offer to purchase all (or any and all)
of the outstanding shares of the Corporation is made by a third party; (d) there
occurs or is proposed a sale or transfer of all, or substantially all, of the
undertaking, property or assets of the Corporation; or (e) there occurs a
mandatory escrow or repricing of unexercised Options pursuant to a request made
by an underwriter or securities regulatory body in connection with an initial
public offering of securities of the Corporation, the Board may, with
appropriate notice and in a fair and equitable manner, determine the manner in
which all unexercised Options granted under the Plan shall be treated including,
for example, requiring the escrowing of such Options, repricing such Options'
exercise price, requiring the acceleration of the expiry time for the exercise
of all or a PRO RATA portion of such Options by the Participants and of the time
for the fulfilment of any conditions or restrictions on such exercise, and/or
declaring that each (or a PRO RATA portion of each) outstanding Option shall be
automatically vested and exercisable in full. All determinations of the Board
pursuant to this Section 15 shall be conclusive and final.

          If at any time after the grant of an Option to any Optionee and prior
to the expiration of the term of such Option, the Shares shall be reclassified,
reorganized or otherwise changed, otherwise than as specified in this Section
15, or the Corporation shall consolidate, merge or amalgamate with or into
another corporation (the corporation resulting or continuing from such
consolidation, merger or amalgamation being herein called the "Successor
Corporation") the Optionee shall be entitled to receive upon the subsequent
exercise of his or her Option in accordance with the terms hereof and shall
accept in lieu of the number of Shares to which he or she was theretofore
entitled upon such exercise, but for the same aggregate consideration payable
therefor, the aggregate number of shares of the appropriate class and/or other
securities of the Corporation or the Successor Corporation (as the case may be)
and/or other consideration from the Corporation or the Successor Corporation (as
the case may be) that the Optionee would have been entitled to receive as a
result of such reclassification, reorganization or other change or
consolidation, merger or amalgamation, if on the record date of such
reclassification, reorganization or other change or the effective date of such
consolidation, merger or amalgamation, as the
<PAGE>

case may be, he or she had been the registered holder of the number of Shares to
which he or she was theretofore entitled upon such exercise.

16.       EFFECT OF TERMINATION ON PARTICIPATION IN THE PLAN.  Upon the
occurrence of an Event of Termination, the Options granted to the relevant
Participant (including Options held by a Trust established for the benefit of
such Participant or to a Personal Holding Corporation of such Participant) may
be exercised only before the earlier of the following (the "Termination Time"):

          (a)  the close of business on the expiry date of the Option; and

          (b)  (i)  in the case of termination of the Participant's employment
                    or directorship with cause by the Corporation, the close of
                    business on the date which is thirty days following the date
                    of such termination; and

               (ii) in any other case, subject to the provisions of Section 19
                    hereof, the close of business on the expiry date of the
                    Option; provided that: (A) the Participant observes his or
                    her fiduciary duties to, and the non-competition and
                    non-solicitation provisions of his or her employment
                    contract with, the Corporation; and (B) after the expiry of
                    such non-competition and non-solicitation provisions, the
                    Participant does not become an employee of or provide
                    services to a Competitor or an Affiliate of a Competitor or
                    becomes a Competitor himself or herself. Where a Participant
                    fails to observe the requirements of either subparagraphs
                    16(b)(ii)A or 16(b)(ii)B, the Options granted to such
                    Participant shall be exercised, in each case, within thirty
                    days of the date of failing to satisfy the requirements of
                    subparagraph 16(b)(ii)A or 16(b)(ii)B, as the case may be.

                    Further, on and from the date of an Event of Termination and
                    subject to the expiry dates outlined above in this Section
                    16, a Participant may only exercise Vested Options as of the
                    close of business on the date of the Event of Termination
                    and the right to exercise Unvested Options shall cease
                    immediately on the date of the Event of Termination without
                    taking into account any notice or severance period except
                    that:

                      (i)  in the case of the death of the Participant or
                           termination of the Participant's employment by the
                           Corporation or the Participant due to permanent
                           disability of the Participant, as determined by the
                           Board acting reasonably and in good faith, a
                           Participant has the right to exercise such Unvested
                           Options which would have otherwise become Vested
                           Options during the one year period immediately
                           following the date of the Event of Termination; and
<PAGE>

                      (ii) in the case of termination of employment or
                           directorship by the Corporation without cause, a
                           Participant may exercise such Unvested Options which
                           would have become Vested Options during the period
                           which is the shorter of: (A) the six month period
                           commencing on the date of such termination of
                           employment; or (B) the period of notice of
                           termination of employment to which the Participant
                           was entitled at law.

17.       CHANGE OF CONTROL.  If an offer is made to purchase all of the issued
and outstanding Shares (for the purposes of this Section 17, an "Offer") and
the Board recommends acceptance of the Offer or if there is a consolidation,
merger or amalgamation of the Corporation with or into any other corporation
whereby the voting shareholders of the Corporation immediately prior to the
consolidation, merger or amalgamation receive shares entitled to exercise
less than 50% of the voting rights attaching to the voting shares of the
consolidated, merged or amalgamated corporation, including a sale whereby all
or substantially all of the Corporation's undertakings and assets become the
property of any other corporation, then a Participant shall, notwithstanding the
provisions of Section 11 hereof, immediately be entitled to exercise such Option
with respect to all of the Shares subject to the Option and not yet purchased
thereunder, provided that the Participant in fact tenders his or her Optioned
Shares to the Offer.

          In addition, if the terms of the Offer permit the tendering of
Optioned Shares by notice of guaranteed delivery or similar procedure in
order to permit the participation in such Offer of the holders of Options, a
Participant shall, notwithstanding Section 11 hereof, have the right to exercise
his or her Options (for purposes of tendering to the Offer) as to the full
amount of Optioned Shares purchasable thereunder, whether or not then vested,
conditional only upon completion of the Offer and to tender the Optioned Shares
to the Offer by notice of guaranteed delivery or similar procedure, provided
that arrangements for payment of the exercise price satisfactory to the
Corporation and in compliance with applicable law are made and the Corporation
will take all reasonable steps necessary to facilitate such conditional exercise
of Options and such tender of Optioned Shares.

18.       TRANSFERABILITY.  Options may only be exercised by the Participant
(including a Trust or Personal Holding Corporation), and upon the Participant's
death, the legal representative of his or her estate. Options are non-assignable
and, accordingly, a Participant exercising an Option may subscribe for Shares
only in his or her own name, on behalf of a Trust, in the name of his or
her Personal Holding Corporation or in his or her capacity as a legal
representative. Upon any attempt to, directly or indirectly, transfer, assign,
pledge, hypothecate or otherwise dispose of an Option contrary to the provisions
of the Plan, or upon the levy of any attachment or similar process upon an
Option or upon the bankruptcy of a Participant, the Option shall, at the
election of the Corporation, cease and terminate and be of no further force or
effect whatsoever.

19.       CALL RIGHT.  If a Participant (in this Section 19, the "Departing
Employee") shall for any reason cease to be an employee of, or consultant to,
the Corporation, the Corporation (in this Section 19 called the "Purchaser")
shall at any time thereafter be
<PAGE>

entitled to send a notice in writing to the Departing Employee requiring the
sale of all of the Options beneficially owned by the Departing Employee
(in this Section 19, the "Purchased Options") and on receipt of such notice,
the Departing Employee (in this Section 19, the "Vendor") shall sell to the
Purchaser and the Purchaser shall purchase from the Vendor the Purchased
Options, upon the terms and conditions hereinafter set forth.

          The purchase price for the Purchased Options shall be the then current
"in-the-money" value thereof, based on the Market Price of the underlying
Shares.

          The closing of the transaction of purchase and sale herein
contemplated shall take place at such place and time as determined by the
Administrators on the date which is the later of: (a) the date which is 15 days
after receipt by the Departing Employee of the notice contemplated in this
Section 19; and (b) the date which is 15 days after the purchase price for the
Purchased Options is finally determined in accordance with the provisions of
this Section 19.

20.       AMENDMENTS TO AND ADMINISTRATION OF THE PLAN.  The provisions of this
Plan may be amended at any time and from time to time by resolution of the Board
without the consent of the Participants and the Plan, as amended, shall govern
the rights and obligations of the Corporation and the Participants with respect
to all then outstanding Options; provided that: (a) unless the change is
required by any securities commission, stock exchange or other governmental or
regulatory body of any jurisdiction to which the Plan or the Corporation now is
or hereafter becomes subject, no such action may materially and adversely affect
the rights of a Participant under any Options then outstanding without the
consent of such Participant; and (b) if required by applicable law or the rules
of any stock exchange on which the securities of the Corporation are then
listed, shareholder approval and other regulatory approval of the amended form
of the Plan is received. Pending such required approvals, additional Options may
be granted under the provisions of the Plan, as amended, provided that all such
required approvals are received prior to the issuance of any Shares of the
Corporation on the exercise of any such additional Options.

21.       TERMINATION OF PLAN.  The Board may terminate this Plan at any time in
its absolute discretion. If the Plan is so terminated, no further Options shall
be granted, but the Options then outstanding shall continue in full force and
effect in accordance with the provisions of this Plan.

22.       DELAY IN PROCESSING.  The Corporation will use its reasonable best
efforts to process any exercise of the vested portion of any Option within three
business days after all necessary procedures required for a valid exercise have
been complied with by the Optionee. The Corporation shall not be responsible for
any delay in responding to a valid exercise of Options due to inadvertence or
otherwise in completing the exercise procedures or for any decline in the value
of the Shares in respect of which the Option is being exercised.

23.       COMPLIANCE WITH STATUTES AND REGULATIONS.  The granting of Options and
the sale and delivery of Shares under this Plan shall be carried out in
compliance with applicable statutes and with the regulations of governmental
authorities and applicable stock exchanges. If the Administrators determine in
their discretion that, in order to comply with any such statutes or regulations,
certain action is necessary or desirable as a
<PAGE>

condition of, or in connection with, the granting of an Option or the issue or
purchase of Shares under an Option, that Option may not be exercised in whole or
in part unless that action shall have been completed in a manner satisfactory to
the Administrators. Nothing herein shall be deemed to require the Corporation to
apply for or to obtain any required listing, registration, qualification,
consent or approval. For greater certainty, the Corporation shall not be
required to qualify for distribution the Options or the Shares purchaseable
thereunder pursuant to a prospectus or registration statement.

24.       RIGHT TO EMPLOYMENT.  Nothing in the Plan or any Option shall confer
upon a Participant any right to continue or be re-elected as a director of the
Corporation or any right to continue in the employ of the Corporation or any
Affiliate, or affect in any way the right of the Corporation or any Affiliate to
terminate his or her employment at any time; nor shall anything in the Plan or
any Option be deemed or construed to constitute an agreement, or an expression
of intent, on the part of the Corporation or any Affiliate, to extend the
employment of any Optionee beyond the time at which he or she would normally be
retired pursuant to the provisions of any present or future retirement plan of
the Corporation or any Affiliate or any present or future retirement policy of
the Corporation or any Affiliate, or beyond the time at which he or she would
otherwise be retired pursuant to the provisions of any contract of employment
with the Corporation or any Affiliate.

25.       SUCCESSOR CORPORATION.  The Plan applies without any further formality
or action to any corporation resulting from the amalgamation of the Corporation
with one or more other corporations.

26.       GOVERNING LAW.  The Plan, and any and all determinations made and
actions taken in connection with the Plan, shall be governed by and construed in
accordance with the laws of the Province of Ontario and the laws of Canada
applicable therein.

27.       SUBJECT TO APPROVAL.  The Plan is adopted subject to the approval of
the shareholders of the Corporation (if required by law or regulation) and any
other required regulatory approval. To the extent a provision of the Plan
requires regulatory approval which is not received, such provision shall be
severed from the remainder of the Plan until the approval is received and the
remainder of the Plan shall remain in effect.

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