SR Telecom Inc. Uses in Establishment of the Plan Clause

Establishment of the Plan from Stock Option Plan

Amendments to the Restated 1998 Key Employee Stock Option Plan (in effect as of the 19th day of April 2001) have been approved by the Board of Directors of the Corporation as of February 12th, 2003, subject to approval of the Shareholders and the Toronto Stock Exchange. These amendments have been integrated with the remnant of the Plan to form the Restated 1998 Key Employee Stock Option Plan, the text of which is as follows:

Establishment of the Plan. The purpose of the Restated 1998 Key Employee Stock Option Plan (the "Plan") is to provide compensation in part to the key employees and directors of SR Telecom Inc. ("SRT") and its subsidiaries through the granting of options to acquire common shares of SRT. The Board of Directors of SRT (the "Board") may grant options to purchase on a periodic basis common shares hereunder. A total of four million, five hundred thousand (4,500,000) common shares of SRT have been set aside and reserved for issuance under the Plan. Shares reserved under lapsed or expired options will be available for future grants. The Board shall have full and complete authority to interpret the Plan and to establish the rules and regulations applying to it and to make all other determinations it deems necessary or useful for the administration of the Plan, provided that such interpretations, rules, regulations and determinations shall be consistent with the rules of all stock exchanges on which the shares of SRT are then listed and with relevant securities legislation. Subject to regulatory approval, the Board may, at any time, amend, suspend or terminate the Plan in whole or in part.