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                                                                    EXHIBIT 14.2

                              SAND TECHNOLOGY INC.

            CHARTER OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

I.   PURPOSE

     The Audit Committee (the "Committee") of Sand Technology Inc. (the
"Corporation") is a committee of the Board of Directors which has responsibility
under the governing legislation of the Corporation to review the financial
statements, accounting policies and reporting procedures of the Corporation.

     The primary function of the Committee is to assist the Board of Directors
in fulfilling its oversight responsibilities by reviewing the financial reports
and other financial information provided by the Corporation to any governmental
body or the public, the systems of internal controls of the Corporation
regarding finance, accounting and legal compliance that management and the Board
have established, and the auditing, accounting and financial reporting processes
of the Corporation generally. Consistent with this function, the Committee
should encourage continuous improvement of, and should foster adherence to, the
policies, procedures and practices at all levels of the Corporation.

     The primary duties and responsibilities of the Committee are to:

     o    Serve as an independent and objective party to monitor the financial
          reporting process and the system of internal controls of the
          Corporation.

     o    Monitor the independence and performance of the auditor appointed
          pursuant to the CANADA BUSINESS CORPORATIONS ACT (the "Auditor") and
          the internal audit function of the Corporation.

     o    Provide an open avenue of communication among the Auditor, financial
          and senior management and the Board of Directors.

     The Committee will primarily fulfill these responsibilities by carrying out
the activities enumerated in Section IV of this Charter.

II.  COMPOSITION

     o    The Committee shall be comprised of three or more directors, each of
          whom shall be independent non-management directors, as determined by
          the Board of Directors. The composition of the Committee shall adhere
          to all applicable corporate and securities laws and all requirements
          of the stock exchanges on which shares of the Corporation are listed.
          In particular, the composition of the Committee


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          shall be in accordance with (i) the U.S. Securities Exchange Act of
          1934, as amended, (ii) the NASDAQ listing standards regarding the
          composition of the Committee (including concept of "independence" as
          established by NASDAQ) and the required qualifications and experience
          of the members of the Committee, subject to any exemptions or other
          relief that may be granted from time to time.

     o    All members of the Committee shall have a working familiarity with
          basic finance and accounting practices, and at least one member of the
          Committee shall be a "financial expert" in accordance with applicable
          laws and all requirements of the stock exchanges on which shares of
          the Corporation are listed.

     o    Members of the Committee shall be elected by the Board at the annual
          organizational meeting of the Board (typically held immediately after
          the annual meeting of shareholders) or such other times as shall be
          determined by the Board and shall serve until the next such meeting or
          until their successors shall be duly elected and qualified.

     o    Any member of the Committee may be removed or replaced at any time by
          the Board of Directors and shall cease to be a member of the Committee
          as soon as such member ceases to be a director. Subject to the
          foregoing, each member of the Committee shall hold such office until
          the next annual meeting of shareholders after his or her election as a
          member of the Committee.

     o    The members of the Committee shall be entitled to receive such
          remuneration for acting as members of the Committee as the Board of
          Directors may from time to time determine.

III. MEETINGS

     o    The Committee may appoint one of its members to act as Chairman of the
          Committee. The Chairman will appoint a secretary who will keep minutes
          of all meetings (the "Secretary"). The Secretary does not have to be a
          member of the Committee or a director and can be changed by simple
          notice from the Chairman.

     o    No business may be transacted by the Committee except at a meeting at
          which a quorum of the Committee is present or by a resolution in
          writing signed by all members of the Committee. A majority of the
          members of the Committee shall constitute a quorum, provided that if
          the number of members of the Committee is an even number, one half of
          the number of members plus one shall constitute a quorum.


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     o    The Committee will meet as many times as is necessary to carry out its
          responsibilities but in no event will the Committee meet less than
          four times a year. The Committee shall meet at least once annually
          with the Auditor, with management not present. As part of its job to
          foster open communication, the Committee should meet at least annually
          with management, and the Auditor in separate executive sessions to
          discuss any matters that the Committee or each of these parties
          believe should be discussed privately. In addition, the Committee
          shall meet with the Auditor and management at least quarterly to
          review the financial statements of the Corporation.

     o    The time at which, and the place where, the meetings of the Committee
          shall be held, the calling of meetings and the procedure in all
          respects of such meetings shall be determined by the Chairman, unless
          otherwise provided for in the By-Laws of the Corporation or otherwise
          determined by resolution of the Board of Directors.

     o    The Committee may invite to, or require the attendance at, any meeting
          of the Committee, such officers and employees of the Corporation,
          legal counsel or other persons as it deems necessary in order to
          perform its duties and responsibilities. The Auditor and the internal
          auditor should also be requested or required to attend meetings of the
          Committee and make presentations to the Committee as appropriate.

     o    Subject to the provisions of the governing legislation of the
          Corporation and applicable regulations and stock exchange rules, if
          required for expediency or to prevent loss to the Corporation, the
          Chairman of the Committee may exercise the powers of the Committee in
          between meetings of the Committee. In such event, the Chairman shall
          immediately report to the members of the Committee and the actions or
          decisions taken in the name of the Committee shall be recorded in the
          proceedings of the Committee.

IV.  RESPONSIBILITIES AND DUTIES

     To fulfill its responsibilities and duties the Committee shall:

     DOCUMENTS/REPORTS REVIEW

     o    Review and recommend for approval to the Board of Directors of the
          Corporation any revisions or updates to this Charter. This review
          should be done periodically, but at least annually, as conditions
          dictate.


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     o    Review the interim unaudited quarterly financial statements and the
          annual audited financial statements, and the related press releases of
          the Corporation and report on them to the Board of Directors.

     o    Satisfy itself, on behalf of the Board of Directors, that the
          unaudited quarterly financial statements and annual audited financial
          statements of the Corporation are fairly presented both in accordance
          with generally accepted accounting principles and otherwise, and
          recommend to the Board of Directors whether the quarterly and annual
          financial statements should be approved.

     o    Satisfy itself, on behalf of the Board of Directors, that the
          information contained in the quarterly financial statements of the
          Corporation, annual report to shareholders and other financial
          publications, such as Management's Discussion and Analysis of
          Financial Condition and Results of Operations, the Annual Report on
          Form 20-F and similar documentation required pursuant to the laws of
          the United States does not contain any untrue statement of any
          material fact or omit to state a material fact that is required or
          necessary to make a statement not misleading, in light of the
          circumstances under which it was made.

     o    Review any reports or other financial information of the Corporation
          submitted to any governmental body, or the public, including any
          certification, report, opinion or review rendered by the Auditor.

     o    Review, and if deemed advisable, approve all related party
          transactions as defined in the governing legislation of the
          Corporation and in any applicable regulations and stock exchange
          rules including the NASDAQ Corporate Governance Rules.

     o    Have the right, for the purpose of performing their duties: (i) to
          inspect all the books and records of the Corporation and its
          subsidiaries; (ii) to discuss such accounts and records and any
          matters relating to the financial position of the Corporation with the
          officers and auditors of the Corporation and its subsidiaries and the
          Auditor; (iii) to commission reports or supplemental information
          relating to the financial information; (iv) to require the Auditor to
          attend any or every meeting of the Committee; and (v) to engage such
          independent counsel and other advisors as are necessary in the
          determination of the Committee.

     o    Permit the Board of Directors to refer to the Committee such matters
          and questions relating to the financial position of the Corporation
          and its affiliates or the reporting related to it as the Board of
          Directors may from time to time see fit.

     INDEPENDENT AUDITOR

     o    Be directly and solely responsible for the appointment, compensation,
          and oversight of the work of the Auditor of the Corporation, with such
          Auditor being ultimately accountable to the Board and the Committee.


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     o    Act as the Auditor's channel of direct communication to the
          Corporation. In this regard, the Committee shall, among other things,
          receive all reports from the Auditor of the Corporation, including
          timely reports of:

          1.   all critical accounting policies and practices to be used;

          2.   all alternative treatments of financial information within
               generally accepted accounting principles that have been discussed
               with the management of the Corporation, ramifications of the use
               of such alternative disclosures and treatments, and the treatment
               preferred by the Auditor of the Corporation; and

          3.   other material written communications between the Auditor and the
               management of the Corporation, such as any management letter or
               schedule of unadjusted differences.

     o    Satisfy itself, on behalf of the Board of Directors, that the Auditor
          is "independent" of management, within the meaning given to such term
          in the rules and pronouncements of the applicable regulatory
          authorities and professional governing bodies. In furtherance of the
          foregoing, the Committee shall request that the Auditor at least
          annually provide a formal written statement delineating all
          relationships between the Auditor and the Corporation consistent with
          the rules of NASDAQ, and request information from the Auditor and
          management to determine the presence or absence of a conflict of
          interest. The Committee shall actively engage the Auditor in a
          dialogue with respect to any disclosed relationships or services that
          may impact the objectivity and independence of the Auditor. The
          Committee shall take, or recommend that the full Board take,
          appropriate action to oversee the independence of the Auditor.

     o    Be responsible for preapproving all audit and non-audit services
          provided by the Auditor; provided, however, that the Committee shall
          have the authority to delegate such responsibility to one or more of
          its members to the extent permitted under applicable law and stock
          exchange rules.

     o    Review the performance of the Auditor and make recommendations to the
          Board of Directors as to whether or not to continue to engage the
          Auditor.

     o    Determine and review the remuneration of the Auditor and any
          independent advisors (including independent counsel) to the Committee.


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     o    Satisfy itself, on behalf of the Board of Directors, that the internal
          audit function has been effectively carried out and that any matter
          which the Auditor wishes to bring to the attention of the Board of
          Directors has been addressed and that there are no "unresolved
          differences" with the Auditor.

     FINANCIAL REPORTING PROCESSES AND RISK MANAGEMENT

     o    Review the audit plan of the Auditor for the current year and review
          advice from the Auditor relating to management and internal controls
          and the responses of the Corporation to the suggestions made put
          forth.

     o    Monitor the internal accounting controls, informational gathering
          systems and management reporting on internal controls of the
          Corporation.

     o    Review with management and the Auditor the relevance and
          appropriateness of the accounting policies of the Corporation and
          review and approve all significant changes to such policies.

     o    Satisfy itself, on behalf of the Board of Directors, that the
          Corporation has implemented appropriate systems of internal control
          over financial reporting and the safeguarding of the assets of the
          Corporation and other "risk management" functions (including the
          identification of significant risks and the establishment of
          appropriate procedures to manage those risks and the monitoring of
          corporate performance in light of applicable risks) affecting the
          assets of the Corporation, management, financial and business
          operations and the health and safety of employees and that these
          systems are operating effectively.

     o    Review and approve the investment and treasury policies of the
          Corporation and monitor compliance with such policies.

     o    Establish procedures for the receipt and treatment of (i) complaints
          received by the Corporation regarding accounting, controls, or
          auditing matters and (ii) confidential, anonymous submissions by
          employees of the Corporation as to concerns regarding questionable
          accounting or auditing.

     LEGAL AND REGULATORY COMPLIANCE

     o    Satisfy itself, on behalf of the Board of Directors, that all material
          statutory deductions have been withheld by the Corporation and
          remitted to the appropriate authorities.


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     o    Without limiting its rights to engage counsel generally, review, with
          the principal legal external counsel of the Corporation, any legal
          matter that could have a significant impact on the financial
          statements of the Corporation.

     o    Satisfy itself, on behalf of the Board of Directors, that all
          regulatory compliance issues have been identified and addressed.

     BUDGETS

     o    Assist the Board of Directors in the review and approval of
          operational, capital and other budgets proposed by management.

     GENERAL

     o    Perform any other activities consistent with this Charter, the By-laws
          of the Corporation and governing law and stock exchange rules, as the
          Committee or the Board of Directors deem necessary or appropriate.


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