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                                                                     EXHIBIT 4.1

                              SAND TECHNOLOGY INC.

                            1996 STOCK INCENTIVE PLAN

ARTICLE 1 -- PURPOSE

1.1  PURPOSE

     The purpose of this 1996 Stock lncentive Plan (the "Plan") is to further
     the growth, development and financial success of Sand Technology Inc. (the
     "Corporation") and its Subsidiaries by aligning the personal interests of
     employees, through the ownership of Class A Common Shares without par value
     of the Corporation and related incentives, to those of the Corporation. The
     Plan is further intended to provide flexibility to the Corporation in its
     ability to compensate employees and to motivate, attract and retain the
     services of such employees who have the ability to enhance the value of the
     Corporation and its Subsidiaries. The Plan permits the granting of
     Incentive Stock Options on terms designed to gain certain advantages under
     U.S. Federal income tax law as provided for in the Plan.

ARTICLE 2 -- DEFINITIONS

2.1  "Award" means an Option grant under the Plan.

2.2  "Board" means the Board of Directors of the Corporation.

2.3  "Change in Control" means (a) a merger or consolidation to which the
     Corporation is a party and following which the shareholders of the
     Corporation prior to such merger or consolidation do not have the voting
     power to elect a majority of the members of the Board of Directors of the
     resulting entity; (b) any person (as such term is used in Sections 13 (d)
     and 14(d) (2) of the Exchange Act of 1934, as amended), becoming the
     beneficial owner, directly or indirectly, of more than 50% of any class of
     the share capital of the Corporation or of shares having more than 50% of
     the aggregate voting power of the share capital of the Corporation; (c) a
     sale or transfer of substantially all of the assets of the Corporation (in
     one transaction or a series of related transactions) to an entity that is
     not a Subsidiary; (d) a liquidation or reorganization of the Corporation in
     which the Corporation is not the surviving corporation other than a
     liquidation or reorganization in which the holders of the Class A Common
     Shares of the Corporation immediately prior to the liquidation or
     reorganization have the same proportionate ownership of the surviving
     corporation after the liquidation or reorganization; or (e) during any
     period of two consecutive years or less beginning after adoption of the
     Plan, individuals who at the beginning of such period are members of the
     Board and any new director (s) (other than directors designated by a
     person who has entered into an agreement with the Corporation


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     to effect a transaction of the type described in clauses (a) through (d)
     above) whose election by the Board or nomination for election by the
     shareholders was approved by a vote of at least two-thirds of the directors
     stilI in office who satisfy this test, cease for any reason to constitute a
     majority of the Board.

2.4  "Code" means the Internal Revenue Code of 1986 as amended from time to
     time.

2.5  "Committee" means the committee appointed by the Board to administer the
     Plan at all times and consisting of not less than two members of the Board
     each of whom is a "disinterested person" as defined in Rule 16b-3
     promulgated under the Securities and Exchange Act of 1934, as amended (the
     "1934 Act") and an "outside director" as defined for purposes of Section
     162(m) of the Code.

2.6  "Corporation" means Sand Technology Inc., a corporation existing under the
     Canada Business Corporations Act, or its successor.

2.7  "Employee" means any person who is a regular full-time employee of the
     Corporation or a Subsidiary as may be selected by the Committee from time
     to time.

2.8  "Incentive Option" means an option granted under the Plan which is
     designated by the Committee as an `lncentive Stock Option" as defined in
     the Code.

2.9  "Option" means an lncentive Option and means an Award granted under the
     Plan by the Committee to an Employee in the form of a right to purchase
     Shares evidenced by an option contract containing such provisions as the
     Committee may establish.

2.10 "Permanent Disability" shall mean a physical or mental condition of an
     Employee that (i) in the judgment of the Committee, permanently prevents
     such Employee from being able to continue to serve as an active Employee in
     a capacity comparable to that in which the Employee served prior to the
     disability, or (ii) causes the Employee to become eligible for long-term
     disability benefits under any long-term disability insurance plan then in
     effect with the Corporation or a Subsidiary that at such time is his or her
     employer.

2.11 "Plan" means this 1996 Stock Incentive Plan.

2.12 "Retirement" shall mean the cessation of employment of an Employee by
     reason of retirement, provided that the Employee has reached the age of 65
     years, or the Committee, in its sole and absolute discretion, deems the
     Employee to have retired.

2.13 "Shares" or "Stock" means the Class A Common Shares without par value of
     the Corporation or any successor, including any adjustments in the event of
     changes in capital structure of the type described in the Plan.


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2.14 "Subsidiary" means any corporate entity, of which a majority of the voting
     common or capital stock is owned directly or indirectly by the Corporation.

ARTICLE 3 -- ADMINISTRATION 0F THE PLAN

3.1  ADMINISTRATION BY THE COMMITTEE

     The Plan shall be administered by the Committee. Members of the Committee
     are not eligible for Awards under the Plan. Unless otherwise required by
     law or rules it may establish, the Committee may act through written
     consent of aIl its members, or vote of a majority comprised of at least two
     of its members, and may hold telephonic meetings where aIl participating
     members can hear each other. A majority comprised of at least two members
     shall constitute a quorum of the Committee. The Board may in its discretion
     at any time and from time to time alter the membership of the Committee
     consistent with the requirements set forth in the Plan.

3.2  POWERS

     The Committee shall have full and final authority in its discretion to
     operate, interpret, manage, administer and make determinations under or
     relevant to the Plan on behalf of the Corporation. This authority includes,
     but is not limited to:

     (a)  the power to select Employees to receive Awards from time to time and
          determine the type and terms and conditions of Awards;

     (b)  the power to grant Awards conditionally or unconditionally, on such
          terms, conditions and restrictions not inconsistent with the
          provisions of the Plan as it prescribes from time to time, including
          the power to determine the option exercise or purchase price of the
          Shares subject to each Award and the time or times when the benefits
          of each Award shall become vested, exercisable, or free of
          restrictions, as the case may be, and the duration of any exercise,
          vesting or restricted period;

     (c)  the power to determine the number of Shares subject to each Award, and
          the time or times when Awards are made;

     (d)  the power to prescribe the form or forms of the instruments evidencing
          Awards granted under the Plan, to construe and interpret the Plan and
          the provisions of said instruments, and to make determinations of fact
          relevant to the administration of the Plan and the benefits under the
          Plan;

     (e)  the power to adopt, amend and rescind regulations consistent with the
          provisions of the Plan for the operation, interpretation, management
          and administration of the Plan;


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     (f)  the power to delegate responsibility for the operation, management and
          administration of the Plan, subject to the oversight and control of
          the Committee, on such terms, consistent with the Plan, as the
          Committee may establish;

     (g)  the power to delegate to other persons the responsibility for
          performing appropriate functions in furtherance of the purpose of the
          Plan;

     (h)  the power to engage or authorize the engagement of the services of
          persons, companies or organizations in furtherance of the purpose of
          the Plan, including but not limited to, banks, insurance companies,
          brokerage firms and consultants; and

     (i)  the power to waive or modify terms, conditions, restrictions and
          forfeitures of Awards, in whole or in part, for such periods and for
          such Employees, and on such terms as it shall determine.

ARTICLE 4 -- ELIGIBILITY AND SHARES SUBJECT TO THE PLAN

4.1  ELIGIBLE EMPLOYEES

     Awards may be granted only to Employees selected or approved by the
     Committee in its sole and absolute discretion. Employees who serve on the
     Board will be eligible for Awards, but they will not be eligible to
     participate in the administration of the Plan or to be a member of the
     Committee. No Employee may be granted Awards for more than 5% of the Shares
     of the Corporation.

4.2  RELEVANT FACTORS

     In selecting Employees to whom Awards shall be granted, the Committee shall
     weigh such factors as are relevant to accomplish the purpose of the Plan.
     An Employee who has been granted an Award may be granted additional Awards,
     if the Committee so determines.

4.3  NUMBER OF SHARES SUBJECT TO THE PLAN

     Subject to the provisions of Article 9 of the Plan, the aggregate number of
     Shares for which Awards may be granted under the Plan shall not exceed
     1,100,000 Shares. The Committee has the authority to grant all Shares under
     the Plan as lncentive Options. The Shares to be delivered upon exercise of
     Options under the Plan shall be made available from the authorized but
     unissued Shares of the share capital of the Corporation. The grant of an
     Option under the Plan shall reduce the number of Shares which thereafter
     may be available for future grants under the Plan, provided that if an
     Option under the Plan shall expire or terminate unexercised as to any
     Shares covered by such Option, such Shares shall thereafter be available
     for the granting of other Awards under the Plan.


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4.4  NON-TRANSFERABILITY OF AWARDS

     No Award granted under the Plan shall be transferable by the Employee
     otherwise than by will or the laws of descent and distribution, or pursuant
     to a qualified domestic relations order, and such Award may be exercised
     during the lifetime of the Employee only by the Employee.

ARTICLE 5 -- INCENTIVE OPTION AWARDS

5.1  TERM AND OTHER PROVISION OF INCENTIVE OPTION AWARDS

     Subject to the provisions of Section 6.1, the term of each Incentive Option
     granted under the Plan shall be for such period as the Committee shall
     determine, but not for any longer period than the limit for lncentive
     Options provided from time to time under the Code. Each Incentive Option be
     subject to earlier termination as provided in the Plan. Provisions relating
     to waiting period, vesting and such other terms and conditions not
     inconsistent with the Plan shall also be set from time to time by the
     Committee so as to achieve the tax advantages provided for Incentive
     Options under the Code.

5.2  INCENTIVE OPTION PRICE

     The exercise price for an Incentive Option shall be determined by the
     Committee at the time such Option is granted, and shall be not less than
     the market value of the Shares covered thereby at the time the Incentive
     Option is granted. The market value per share shall be the dosing price of
     the Shares on the principal stock exchange or quotation system on which the
     Shares are trading on the day of the grant, or if there were no sales
     reported as of such day, then the last day preceding such day on which a
     sale was reported, or if any such exchange or quotation system is closed on
     that day, then on the last preceding day on which the stock exchange or
     quotation system was open for trading.

ARTICLE 6 -- MATTERS RELATIVE TO ALL INCENTIVE OPTIONS

6.1  VESTING OF OPTIONS

     Each Option granted under the Plan shall provide that it is to be exercised
     within a period of ten (10) years after the date on which the Option is
     granted.


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6.2  EXERCISE

     Each Option granted under the Plan shall be exercisable on such date or
     dates, during such period, for such number of Shares, and upon such terms
     as shall be provided in the option contract evidencing such Option, which
     shall be approved by the Committee.

6.3  NOTICE OF EXERCISE

     A person electing to exercise an Option shall give written notice of
     exercise to the person at the Corporation designated to receive such
     notice. The exercise notice shall specify the number of Shares the optionee
     has elected to purchase and be accompanied by payment in full of the
     aggregate purchase price of the Shares. Payment shall be made by certified
     cheque or such other form of payment as the Committee may accept. Until an
     optionee has been issued a certificate or certificates for the Shares so
     purchased, he or she shall possess no rights of a record holder with
     respect to any of such Shares.

6.4  PARTICULAR CIRCUMSTANCES EFFECT ON OPTIONS

     No Option shall be affected by any change of duties or position of the
     optionee (including transfer to or from a Subsidiary), so long as he or she
     continues to be an Employee. Except in cases of death, Permanent
     Disability, Retirement or other circumstances specified by the Committee in
     its discretion (including, but not limited to, a 30-day extension for
     exercise following termination of employment), if an optionee shall cease
     to be an Employee, all Options held by such person will terminate on the
     date of termination of the person's employment, and up to such date shall
     be exercisable only to the extent of the purchase rights, if any, which
     have accrued as of such date. Nevertheless, the Committee, in its sole and
     absolute discretion, upon any such cessation of employment, may determine
     (but be under no obligation to determine) that such accrued purchase rights
     shall be deemed to include additional Shares covered by such Option and may
     be extended for an additional period of time. In case of dismissal for
     cause, the Corporation may revoke all rights of the Employee to purchase
     Shares that have not previously been issued to the Employee. In the event
     of any Change in Control, all Options outstanding shall become immediately
     exercisable for the full number of Shares subject to option regardless of
     any vesting or exercise schedule otherwise specified in such Options, and
     optionees shall be entitled to at least a 2O-day prior written notice, and
     the opportunity to exercise such rights, before any transaction in
     connection with the Change in Control may defeat or nullify the economic
     benefit of such Options.


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6.5  RETIREMENT OF OPTIONEE

     Should an optionee begin Retirement while in possession of an Option under
     the Plan, vesting and exercisability of such Option shall continue as if
     the optionee were still an employee.

6.6  DISABILITY OF OPTIONEE

     Should an optionee be determined by the Committee to have suffered a
     Permanent Disability while in possession of an Option under the Plan,
     vesting will forthwith accelerate, such that the Option immediately becomes
     100% vested, and the optionee or his or her legal representative will have
     one year from the date of determination of the Permanent Disability to
     exercise such Option, at which time the Option will expire and no longer be
     exercisable, provided that in any case the Option shall expire no later
     than the last day of its original term.

6.7  DEATH OF OPTIONEE

     Should an optionee (including one determined to have suffered a Permanent
     Disability under Section 6.6 above) die while in possession of the right to
     exercise an Option under the Plan, vesting will forthwith accelerate, such
     that the Option immediately becomes 100% vested. Thereafter, such person(s)
     who shall have been designated as beneficiary by the optionee, or in the
     absence of such designation, such person as shall be responsible for the
     administration of the will or estate of the optionee or, in the absence of
     the appointment of such person within six months of the date the optionee
     died, the person(s) who shall be entitled to acquire the property of the
     optionee, by will or by the laws of descent and distribution (the
     "beneficiary"), may exercise such Option. This exercise may occur at any
     time within two years from the date of death if such Option is an Incentive
     Option. Nevertheless, any such Option shall expire no later than the last
     day of the original term of such Option.

6.8  MINIMUM SIX-MONTH HOLDING PERIOD

     Subject to Section 6.4 of the Plan, if an Option is exercised within the
     six-month period commencing on the date of grant, no Shares purchased upon
     such exercise may be sold until such period has elapsed. The Corporation
     may establish such rules and procedures as it deems appropriate to enforce
     this restriction.

ARTICLE 7 -- RIGHTS AS AN EMPLOYEE

7.1  NO IMPLIED RIGHTS

     Awards under the Plan are discretionary and are not a part of regular
     salary. Awards may not be used in determining the amount of compensation
     for any


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     purpose under any benefit plan of the Corporation or any Subsidiary, except
     as the Committee may from time to time expressly provide. Neither the Plan
     nor any action taken under the Plan shall be construed as giving an
     Employee the right to any Award, and an Award under the Plan shall not be
     construed as giving an Employee any right to be retained in the employ or
     service of the Corporation or any of its Subsidiaries for any period of
     time, regardless of the terms or conditions of the Award or the manner in
     which such terms or conditions are described in the applicable Award
     instrument.

7.2  BENEFICIARY DESIGNATION

     If allowed by the Committee from time to time, an Employee may designate a
     person or persons to receive, in the event of his or her death, any rights
     to which he or she would be entitled under the Plan. Such a designation
     shall be made in writing and filed with the Committee or such person as it
     may designate. A beneficiary designation may be changed or revoked by an
     Employee at any time by filing a written statement of such change or
     revocation with the Committee. If an Employee dies having failed to
     designate a beneficiary or if the beneficiary of the Employee does not
     survive the Employee, then the estate of the Employee shall be deemed to be
     his or her beneficiary.

7.3  OPTIONS NOT INCLUDED FOR BENEFIT PURPOSES

     Income recognized by an Employee pursuant to the provisions of the Plan
     shall not be included in the determination of benefits under any employee
     pension benefit plan (as such term is defined in Section 3 (2) of ERISA or
     the rules thereunder) or group insurance or other benefit plans applicable
     to the Employee that are maintained by the Corporation or any of its
     Subsidiaries, except as may be provided under the terms of such plans or
     determined by resolution of the Board.

ARTICLE 8 -- AMENDMENT 0F THE PLAN

8.1  AMENDMENT OF PLAN

     The Board (excluding any members entitled to an Award under the Plan) may
     amend the Plan from time to time, except that amendments must be approved
     by shareholders of the Corporation to the extent required under Section 16
     (b) of the Securities Exchange Act of 1934 and other applicable
     legislation.

8.2  EFFECT ON AWARDS

     Awards granted prior to suspension or termination of the Plan may not be
     amended or cancelled except with the consent of the Employee recipient of
     the Award. Any dispute or disagreement that may arise under or as a result
     of, relating to or pursuant to, any Award or contract evidencing the same
     shall be


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     determined by the Committee, which determination shall be conclusive,
     binding and final for all purposes with respect to all persons.

ARTICLE 9 -- CHANGES IN CAPITAL STRUCTURE

9.1  ADJUSTMENTS DUE TO CHANGES IN CAPITAL STRUCTURE

     The option contracts evidencing Awards granted under the Plan shall be
     subject to adjustment in the event of changes in the outstanding share
     capital of the Corporation by reason of stock dividends, stock splits,
     recapitalizations, reorganizations, mergers, consolidations, combinations,
     exchanges or other relevant changes in capitalization occurring after the
     date of an Award to the same extent as such occurrence would affect an
     actual share issued and outstanding on the effective date of such change.
     In the event of any such change, the aggregate number and classes of shares
     for which Awards may thereafter be granted under the Plan shall be
     appropriately adjusted as determined by the Committee so as to reflect such
     change.

ARTICLE 10 -- WITHHOLDING 0F TAXES

10.1 COLLECTION OF TAXES DUE

     The Corporation and its Subsidiaries shall have the right, before a
     certificate for any Share is delivered, to deduct or withhold from any
     payment owed to an Employee, any amount that is necessary in order to
     satisfy any withholding requirement that the Corporation or the Subsidiary
     in good faith believes is imposed upon it in connection with Federal,
     state, provincial or local taxes, including transfer taxes, as a result of
     the issuance of, or lapse of restrictions on, such Shares, or otherwise
     require such Employee to make provision for payment of any such withholding
     amount.

10.2 PAYMENT AND DELIVERY OF SHARES

     Unless otherwise provided by the Committee and subject to the provisions of
     Section 6.3, the Corporation, in its discretion and subject to such rules
     and restrictions as it may establish from time to time, may:

     (a)  accept payment for the Shares related to an Award by any manner of
          lawful consideration permitted by applicable statute;

     (b)  issue the Shares registered in the name of the Employee to the custody
          of his or her broker when requested in writing by the Employee with
          his or her exercise notice and when preceded by full payment or the
          irrevocable commitment of a stockbroker on behalf of the Employee to
          pay the Corporation any balance due on the purchase price for such
          Shares


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          following their issuance, whereupon such issuance and payment will be
          viewed as contemporaneous.

ARTICLE 11 -- GOVERNMENTAL AND OTHER REGULATIONS

11.1 EFFECT OF APPLICABLE LAWS

     The Plan and any Award under the Plan shall comply with all applicable
     Federal, Provincial and state laws, rules and regulations of Canada and the
     United States, including the Securities Act (Quebec), the Securities Act of
     1933 and the Securities Exchange Act of 1934, and to such approvals by any
     regulatory or governmental agency of Canada and the United States as may be
     required. The issuance or delivery of any Award or of any Shares under an
     Award, may be postponed by the Corporation for such period as may be
     required to comply with any applicable requirements under securities laws,
     any applicable listing requirements of any national securities exchange or
     automated quotation system where the Shares are listed, and requirements
     under any other law or regulation applicable to the issuance or delivery of
     such Shares. The Corporation shall not be obligated to issue or deliver any
     Share if its issuance or delivery shall constitute a violation of any
     provision of any law or of any regulation of any governmental authority or
     any national securities exchange or automated quotation system where the
     Shares are listed.

ARTICLE 12 -- EFFECTIVE DATE AND TERM 0F THE PLAN

12.1 EFFECTIVE DATE AND TERM

     The Plan shall become effective upon its adoption by the Board and its
     approval by the shareholders of the Corporation, and shall continue until
     such time as it may be terminated by action of the Board or the
     Shareholders of the Corporation. All Options granted prior to shareholder
     approval are granted conditional upon shareholder approval of the Plan.

ARTICLE 13 -- MISCELLANEOUS PROVISIONS

13.1 OPTION AGREEMENT

     Options shall be evidenced by written option contracts in the form approved
     by the Committee.

13.2 INDEMNIFICATION

     In addition to such other rights of indemnification as they may have as
     Directors or as members of the Board, the members of the Board and the
     Committee shall be indemnified by the Corporation against the reasonable
     expenses, including attorneys' fees actually and necessarily incurred in
     connection with the defense


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     of any action, suit or proceeding, or in connection with any appeal, to
     which they or any of them may be a party by reason of any action taken or
     failure to act under or in connection with the Plan or any option granted
     under it, and against all amounts paid by them in settlement (provided such
     settlement is approved by independent legal counsel selected by the
     Corporation) or paid by them in satisfaction for a judgment in any such
     action, suit or proceeding, except in relation to matters as to which it
     shall be adjudged in such action, suit or proceeding that such Board member
     is liable for gross negligence or wilful misconduct in the performance of
     his duties. Within ten (10) days after institution of any such action, suit
     or proceeding a Board member shall notify the Corporation of the
     institution of the suit and grant the Corporation the opportunity, at its
     own expense, to handle and defend the same. Failure to provide such notice
     shall, at the option of the Corporation, relieve the Corporation of the
     indemnification obligations set forth in this Section 14.2.

13.3 NO OBLIGATION TO EXERCISE OPTION

     The grant of an Option shall impose no obligation upon the optionee to
     exercise such Option.

13.4 SINGULAR, PLURAL, GENDER

     The singular shall include the plural and the masculine pronoun shall
     include the feminine gender.

13.5 HEADINGS

     Headings of Articles and Sections are inserted for convenience and
     reference only; they constitute no part of the Plan.

13.6 COMPLIANCE WITH RULE 16B-3

     It is the intent of the Corporation that the Plan comply in all respects
     with Rule 16b-3 of the Securities Exchange Act of 1934 in connection with
     any Option granted to a person who is subject to Section 16 of the said
     Act. Accordingly, any provision of the Plan or any option contract that
     does not comply with the requirements of such Rule 16b-3 as then applicable
     to any such person shall be construed or deemed amended to the extent
     necessary to conform to such requirements, except that such automatic
     amendment shall not apply to any other participant in the Plan who is not
     (at the time of such application) subject to Section 16 of the Act. Any
     action taken by the Committee pursuant to the Plan that does not comply
     with the requirements of such Rule 16b-3 shall be null and void.


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13.7 GOVERNING LAW

     The Plan and all determinations made and actions taken pursuant to the Plan
     shall be governed by the laws of the State of Delaware.

13.8 SEVERABILITY

     Whenever possible, each provision of the Plan and every Option at any time
     granted under the Plan shall be interpreted in such manner as to be
     effective and valid under applicable law, but if any provision of the Plan
     or any Option at any time granted under the Plan shall be held to be
     prohibited by or invalid under applicable law, then (a) such provision
     shall be deemed amended to accomplish the objectives of the provision as
     originally written to the fullest extent permitted by law and (b) aIl other
     provisions of the Plan and every other Option at any time granted under the
     Plan shall remain in full force and effect.

AS AMENDED TO REFLECT (I) THE SHARE SUBDIVISION ON A TWO-FOR-ONE BASIS ON
DECEMBER 31, 1996, (II) THE RESOLUTION OF THE DIRECTORS OF NOVEMBER 9, 1999
WHICH WAS RATIFIED BY THE SHAREHOLDERS ON DECEMBER 17, 1999 TO INCREASE THE
MAXIMUM AGGREGATE NUMBER OF SHARES AVAILABLE BY 300,000, (III) THE CHANGE OF
NAME OF THE CORPORATION EFFECTIVE JANUARY 1, 2000, AND (IV) THE EXTENSION OF THE
LIFE OF THE PLAN FOR AN ADDITIONAL TEN YEARS.


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