News release

 Zi Corporation


OCTOBER 17, 2002 - 07:30 EDT

JKC Group and Zi Corporation Schedule Magic Lantern Closing: JKC Mails Proxy Materials for Shareholder Approval


NEW YORK, NEW YORK and CALGARY, ALBERTA--JKC Group, Inc., a distributor and licensor (AMEX: JKC), and Zi Corporation, a leading provider of intelligent interface solutions (Nasdaq: ZICA)(TSX: ZIC), today announced they expect to complete JKC's pending acquisition of Magic Lantern Communications from Zi upon approval of the acquisition and related transactions by JKC's shareholders at a special meeting scheduled for November 7, 2002. Mailing of JKC's proxy materials for the special meeting started yesterday following last Friday's completion of SEC review procedures for the JKC proxy statement. The proxy statement indicates that approval of the proposals is assured based on support for the transactions by JKC's principal shareholder.

Founded in 1975, Magic Lantern is one of Canada's leading distributors of educational and learning content in video and other electronic formats. Upon closing of the Magic Lantern sale, Zi Corporation will receive a three-year promissory note of JKC for US$3 million and a 45 percent equity interest in JKC, valued at US$9 million based on yesterday's closing price of JKC's common stock on the AMEX. Additional stock and cash consideration or offsets up to US$1 million against the note are provided under earnout and claw-back arrangements based on post-acquisition operating results.

The acquisition is also expected to increase JKC's shareholders' equity to approximately US$10 million. "This will satisfy the last phase of our plan for regaining compliance with AMEX continued listing requirements for our common stock," noted Richard Siskind, President and Chief Executive Officer of JKC. "It will also mark the beginning of our planned business redirection to a market we believe has great potential."

Michael Lobsinger, Chairman and Chief Executive Officer of Zi, added "We expect this transaction to help position Magic Lantern to realize value for both JKC and Zi shareholders. It is another step in our program to re-characterize and enhance the value of our investments in e-learning."

About Zi Corporation

Zi Corporation (www.zicorp.com) is a market-driven technology company delivering ntelligent interface solutions to enhance the user experience of wireless and consumer technologies. The company's core technology products, eZiTap and eZiText, connect people to short messaging, e-mail, e-commerce, Web browsing and similar applications in almost any written language. eZiNet is a new network-based platform that enables handset manufacturers and network operators to provide users with access to media rich content and information stored on a network, despite the memory restrictions of the mobile device. Zi supports its strategic partners and customers from offices in Asia, Europe and North America. A publicly traded company, Zi Corporation is listed on the Nasdaq National Market (ZICA) and the Toronto Stock Exchange (ZIC).

About JKC Group Inc.

JKC Group, Inc., formerly named Stage II Apparel Corp., was historically engaged primarily as a distributor of apparel. The company has significant experience in licensing and distribution. It previously announced its plan to contract apparel operations and focus its resources on expanding these two service lines. To accomplish the first phase of its planned business redirection, JKC completed an equity infusion and related board reconstitution in April 2002. Its common stock is listed on the American Stock Exchange (JKC).

Certain statements in this press release that involve expectations or intentions may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The information in this press release is based on current expectations and assumptions, which may involve a number of risks and uncertainties that could cause actual results to differ materially from those anticipated. Those risks include unanticipated business and economic conditions, competitive actions, continued acceptance of products and services and dependence on third party performance. Because of those risks, among others, readers should not place undue reliance on the forward looking statements. Neither JKC Group, Inc. nor Zi Corporation assumes any obligation to update forward looking statements in this press release.

- 30 -

For further information please contact:

Allen & Caron Inc.: Investor Inquiries
Jill Bertotti
(949) 474-4300
Email: jill@allencaron.com

 Allen & Caron Inc.: Media Inquiries
Len Hall
Business/Financial Media Inquiries
(949) 474-4300
Email: len@allencaron.com
Zi Corporation: Investor Inquiries
Dale Kearns
Chief Financial Officer
(403) 233-8875
Email: investor@zicorp.com
Website: www.zicorp.com

 FitzGerald Communications: Media Inquiries
Fred Bateman
Technology Media Inquiries
(415) 986-9500 ex. 208
Email: fbateman@fitzgerald.com
JKC Group Inc.: Investor Inquiries
Richard Siskind
Chief Executive Officer
(212) 840-0880

  

Close Window