Exhibit  EX-4.91




NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE
SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933 (the “1933 ACT”), AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS.



THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED WITHIN THE UNITED STATES
OR TO ANY U.S. PERSON (AS DEFINED IN RULE 902 OF THE 1933 ACT) (I) IN THE ABSENCE OF (A) AN
EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE 1933 ACT, OR (B) AN OPINION OF
COUNSEL, IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER
SAID ACT IN RELIANCE UPON RULE 144 OR RULE 144A UNDER SAID ACT OR ANOTHER AVAILABLE EXEMPTION.
NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES TOGETHER WITH OTHER
SECURITIES OF THE HOLDER.



UNLESS PERMITTED UNDER CANADIAN SECURITIES LAWS, THE HOLDER OF THIS WARRANT AND THE COMMON SHARES
ISSUABLE UPON EXERCISE OF THIS WARRANT SHALL NOT TRADE SUCH SECURITIES BEFORE NOVEMBER 28, 2005.



ART Advanced Research Technologies Inc.




Warrant To Purchase Common Shares




Warrant No.: B-1


Number of Common Shares: 61,675     


Date of Issuance: July 28, 2005 (“Issuance Date”)



ART Advanced Research Technologies Inc., a Canadian corporation (the “Company”), hereby
certifies that, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, PORTSIDE GROWTH AND OPPORTUNITY FUND, the registered holder hereof or its
permitted assigns (the “Holder”), is entitled, subject to the terms set forth below, to purchase
from the Company, at the Exercise Price (as defined below) then in effect, upon surrender of this
Warrant to Purchase Common Shares (including any Warrants to Purchase Common Shares issued in
exchange, transfer or replacement hereof, the “Warrant”), at any time or times on or after the
Issuance Date, but not after 11:59 p.m., New York Time, on the Expiration Date (as defined below),
SIXTY ONE THOUSAND AND SIX HUNDRED AND SEVENTY FIVE (61,675) fully paid non-assessable Common
Shares (as defined below) (the “Warrant Shares”). Except as otherwise defined herein, capitalized
terms in this Warrant shall have the meanings set forth in Section 15. This Warrant is one of the
Warrants to Purchase Common Shares (the “SPA Warrants”) issued pursuant to Section 1 of that
certain Securities Purchase Agreement, dated as of July 28, 2005 (the “Subscription Date”), by and
among the Company and the investors (the “Buyers”) referred to therein (the “Securities Purchase
Agreement”).



1. EXERCISE OF WARRANT.



(a) Mechanics of Exercise. Subject to the terms and conditions hereof (including,
without limitation, the limitations set forth in Section 1(e) and the conditions set forth in the
Exercise Notice (as defined below)), this Warrant may be exercised by the Holder on any day on or
after the Issuance Date, in whole or in part, by (i) delivery of a written notice, in the form
attached hereto as Exhibit A (the “Exercise Notice”), of the Holder’s election to exercise
this Warrant and (ii) payment to the Company of an amount equal to the applicable Exercise Price
multiplied by the number of Warrant Shares as to which this Warrant is being exercised (the
"Aggregate Exercise Price”) in cash or wire transfer of immediately available funds. The Holder
shall not be required to deliver the original Warrant in order to effect an exercise hereunder.
Execution and delivery of the Exercise Notice with respect to less than all of the Warrant Shares
shall have the same effect as cancellation of the original Warrant and issuance of a new Warrant
evidencing the right to purchase the remaining number of Warrant Shares. On or before the first
Business Day following the date on which the Company has received each of the Exercise Notice and
the Aggregate Exercise Price (the “Exercise Delivery Documents”), the Company shall transmit by
facsimile an acknowledgment of confirmation of receipt of the Exercise Delivery Documents to the
Holder and the Company’s transfer agent (the “Transfer Agent”). On or before the third Business
Day following the date on which the Company has received all of the Exercise Delivery Documents
(the “Share Delivery Date”), the Company shall (X) provided that the Transfer Agent is
participating in The Depository Trust Company (“DTC”) Fast Automated Securities Transfer Program,
upon the request of the Holder, credit such aggregate number of Common Shares to which the Holder
is entitled pursuant to such exercise to the Holder’s or its designee’s balance account with DTC
through its Deposit Withdrawal Agent Commission system, or (Y) if the foregoing shall not apply,
issue and dispatch by overnight courier to the address as specified in the Exercise Notice, a
certificate, registered in the Company’s share register in the name of the Holder or its designee,
for the number of Common Shares to which the Holder is entitled pursuant to such exercise. Upon
delivery of the Exercise Delivery Documents, the Holder shall be deemed for all corporate purposes
to have become the holder of record of the Warrant Shares with respect to which this Warrant has
been exercised, irrespective of the date of delivery of the certificates evidencing such Warrant
Shares. If this Warrant is submitted in connection with any exercise pursuant to this Section 1(a)
and the number of Warrant Shares represented by this Warrant submitted for exercise is greater than
the number of Warrant Shares being acquired upon an exercise, then the Company shall as soon as
practicable and in no event later than three (3) Business Days after any exercise and at its own
expense, issue a new Warrant (in accordance with Section 7(d)) representing the right to purchase
the number of Warrant Shares purchasable immediately prior to such exercise under this Warrant,
less the number of Warrant Shares with respect to which this Warrant is exercised. No fractional
Common Shares are to be issued upon the exercise of this Warrant, but rather the number of Common
Shares to be issued shall be rounded up to the nearest whole number. The Warrant Shares shall bear
the legends referred to in Sections 2(g) of the Securities Purchase Agreement, to the extent
required thereby.



(b) Exercise Price. For purposes of this Warrant, “Exercise Price” means CDN$1.39,
subject to adjustment as provided herein.



(c) Company’s Failure to Timely Deliver Securities. If within three (3) Trading Days
(as defined in the SPA Securities) after the Company’s receipt of the facsimile copy of a Exercise
Notice the Company shall fail to issue and deliver a certificate to the Holder and register such
Common Shares on the Company’s share register or credit the Holder’s balance account with DTC for
the number of Common Shares to which the Holder is entitled upon such holder’s exercise hereunder,
and if on or after such Trading Day the Holder purchases (in an open market transaction or
otherwise) Common Shares to deliver in satisfaction of a sale by the Holder of Common Shares
issuable upon such exercise that the Holder anticipated receiving from the Company (a “Buy-In"),
then the Company shall, within three (3) Business Days after the Holder’s request and in the
Holder’s discretion, either (i) pay cash to the Holder in an amount equal to the Holder’s total
purchase price (including brokerage commissions, if any) for the Common Shares so purchased (the
“Buy-In Price"), at which point the Company’s obligation to deliver such certificate (and to issue
such Common Shares) shall terminate, or (ii) promptly honor its obligation to deliver to the Holder
a certificate or certificates representing such Common Shares and pay cash to the Holder in an
amount equal to the excess (if any) of the Buy-In Price over the product of (A) such number of
Common Shares, times (B) the Closing Bid Price on the date of exercise.



(d) Disputes. In the case of a dispute as to the determination of the Exercise Price
or the arithmetic calculation of the Warrant Shares, the Company shall promptly issue to the Holder
the number of Warrant Shares that are not disputed and resolve such dispute in accordance with
Section 15.



(e) Limitation on Exercises.




(i) Beneficial Ownership. Notwithstanding anything
contained herein to the contrary, the Company shall not effect any
exercise of this Warrant, and the Holder shall not have the right to
exercise any portion this Warrant, that would be exercisable for that
number of Common Shares which, when added to the number of Common
Shares otherwise beneficially owned by the Holder including those
issuable upon the exercise of convertible securities, warrants or
options held by the Holder, would exceed 4.99% (the “Maximum
Percentage”) of the outstanding Common Shares at the time of
conversion. For purposes of this paragraph, beneficial ownership
shall be calculated in accordance with Section 13(d) of the
Securities Exchange Act of 1934, as amended. For purposes of this
Warrant, in determining the number of outstanding Common Shares, the
Holder may rely on the number of outstanding Common Shares as
reflected in (1) the Company’s most recent Form 20-F, Current Report
on Form 6-K or other public filing with the Securities and Exchange
Commission or the Canadian Securities Administration, as the case may
be, (2) a more recent public announcement by the Company or (3) any
other notice by the Company or the Transfer Agent setting forth the
number of Common Shares outstanding. For any reason at any time,
upon the written request of the Holder, the Company shall within one
Business Day of receipt of a written request from the Holder confirm
in writing to the Holder the number of Common Shares then
outstanding. In any case, the number of outstanding Common Shares
shall be determined after giving effect to the conversion or exercise
of securities of the Company, including the SPA Securities and the
SPA Warrants, by the Holder and its affiliates since the date as of
which such number of outstanding Common Shares was reported. By
written notice to the Company, the Holder may increase or decrease
the Maximum Percentage to any other percentage not in excess of 9.99%
specified in such notice; provided that (i) any such increase will
not be effective until the sixty-first (61st) day after
such notice is delivered to the Company, and (ii) any such increase
or decrease will apply only to the Holder and not to any other holder
of SPA Securities.




(ii) Principal Market Regulation. The Company shall not
be obligated to issue any Common Shares upon exercise of this Warrant
if the issuance of such Common Shares would exceed that number of
Common Shares which the Company may issue upon exercise of this
Warrant (including, as applicable, any Common Shares issued upon
conversion or exercise of the SPA Securities) without breaching the
Company’s obligations under the rules or regulations of the Principal
Market (the “Exchange Cap”). The Company shall seek the approval of
the Principal Market, and shall seek the approval of its shareholders
as may be required by the applicable rules of the Principal Market,
for issuances of Common Shares in excess of the Exchange Cap. Once
the Company has obtained the approval or approvals required by the
foregoing sentence, the Exchange Cap shall no longer be applicable.
Until such approval is obtained, no Buyer shall be issued, upon
exercise or conversion, as applicable, of any SPA Warrants or SPA
Securities, Common Shares in an amount greater than the product of
the Exchange Cap multiplied by a fraction, the numerator of which is
the total number of Common Shares issued to such Buyer pursuant to
the Securities Purchase Agreement on the Issuance Date and the
denominator of which is the aggregate number of Common Shares issued
to the Buyers pursuant to the Securities Purchase Agreement on the
Issuance Date (with respect to each Buyer, the “Exchange Cap
Allocation”). In the event that any Buyer shall sell or otherwise
transfer any of such Buyer’s SPA Warrants, the transferee shall be
allocated a pro rata portion of such Buyer’s Exchange Cap Allocation,
and the restrictions of the prior sentence shall apply to such
transferee with respect to the portion of the Exchange Cap Allocation
allocated to such transferee. In the event that any holder of SPA
Warrants shall exercise all of such holder’s SPA Warrants into a
number of Common Shares which, in the aggregate, is less than such
holder’s Exchange Cap Allocation, then the difference between such
holder’s Exchange Cap Allocation and the number of Common Shares
actually issued to such holder shall be allocated to the respective
Exchange Cap Allocations of the remaining holders of SPA Warrants on
a pro rata basis in proportion to the Common Shares underlying the
SPA Warrants then held by each such holder. In the event that the
Company is prohibited from issuing any Warrant Shares for which an
Exercise Notice has been received as a result of the operation of
this Section 1(e)(ii), the Company shall pay cash in exchange for
cancellation of such Warrant Shares, at a price per Warrant Share
equal to the difference between the Closing Sale Price and the
Exercise Price as of the date of the attempted exercise.



2. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and
the number of Warrant Shares shall be adjusted from time to time as follows:



(a) Adjustment upon Issuance of Common Shares. If and whenever on or before the first
anniversary of the Subscription Date the Company issues or sells, or in accordance with this
Section 2 is deemed to have issued or sold, any Common Shares (including the issuance or sale of
Common Shares owned or held by or for the account of the Company, but excluding Common Shares
deemed to have been issued by the Company in connection with any Excluded Securities (as defined in
the SPA Securities) for a consideration per share (the “New Issuance Price”) less than a price (the
"Applicable Price”) equal to the Exercise Price in effect immediately prior to such issue or sale
or deemed issuance or sale (the foregoing a “Dilutive Issuance"), then immediately after such
Dilutive Issuance, the Exercise Price then in effect shall be reduced to the New Issuance Price.
Upon each such adjustment of the Exercise Price hereunder, the number of Warrant Shares shall be
adjusted to the number of Common Shares determined by multiplying the Exercise Price in effect
immediately prior to such adjustment by the number of Warrant Shares acquirable upon exercise of
this Warrant immediately prior to such adjustment and dividing the product thereof by the Exercise
Price resulting from such adjustment. For purposes of determining the adjusted Exercise Price
under this Section 2(a), the following shall be applicable:




(i) Issuance of Options. If the Company in any manner grants
any Options and the lowest price per share for which one Common Share is
issuable upon the exercise of any such Option or upon conversion, exercise
or exchange of any Convertible Securities issuable upon exercise of any such
Option is less than the Applicable Price, then such Common Share shall be
deemed to be outstanding and to have been issued and sold by the Company at
the time of the granting or sale of such Option for such price per share.
For purposes of this Section 2(a)(i), the “lowest price per share for which
one Common Share is issuable upon exercise of such Options or upon
conversion, exercise or exchange of such Convertible Securities” shall be
equal to the sum of the lowest amounts of consideration (if any) received or
receivable by the Company with respect to any one Common Share upon the
granting or sale of the Option, upon exercise of the Option and upon
conversion, exercise or exchange of any Convertible Security issuable upon
exercise of such Option. No further adjustment of the Exercise Price or
number of Warrant Shares shall be made upon the actual issuance of such
Common Shares or of such Convertible Securities upon the exercise of such
Options or upon the actual issuance of such Common Shares upon conversion,
exercise or exchange of such Convertible Securities.




(ii) Issuance of Convertible Securities. If the Company in any
manner issues or sells any Convertible Securities and the lowest price per
share for which one Common Share is issuable upon the conversion, exercise
or exchange thereof is less than the Applicable Price, then such Common
Share shall be deemed to be outstanding and to have been issued and sold by
the Company at the time of the issuance or sale of such Convertible
Securities for such price per share. For the purposes of this Section
2(a)(ii), the “lowest price per share for which one Common Share is issuable
upon the conversion, exercise or exchange” shall be equal to the sum of the
lowest amounts of consideration (if any) received or receivable by the
Company with respect to one Common Share upon the issuance or sale of the
Convertible Security and upon conversion, exercise or exchange of such
Convertible Security. No further adjustment of the Exercise Price or number
of Warrant Shares shall be made upon the actual issuance of such Common
Shares upon conversion, exercise or exchange of such Convertible Securities,
and if any such issue or sale of such Convertible Securities is made upon
exercise of any Options for which adjustment of this Warrant has been or is
to be made pursuant to other provisions of this Section 2(a), no further
adjustment of the Exercise Price or number of Warrant Shares shall be made
by reason of such issue or sale.




(iii) Change in Option Price or Rate of Conversion. If the
purchase price provided for in any Options, the additional consideration, if
any, payable upon the issue, conversion, exercise or exchange of any
Convertible Securities, or the rate at which any Convertible Securities are
convertible into or exercisable or exchangeable for Common Shares increases
or decreases at any time, the Exercise Price and the number of Warrant
Shares in effect at the time of such increase or decrease shall be adjusted
to the Exercise Price and the number of Warrant Shares which would have been
in effect at such time had such Options or Convertible Securities provided
for such increased or decreased purchase price, additional consideration or
increased or decreased conversion rate, as the case may be, at the time
initially granted, issued or sold. For purposes of this Section 2(a)(iii),
if the terms of any Option or Convertible Security that was outstanding as
of the date of issuance of this Warrant are increased or decreased in the
manner described in the immediately preceding sentence, then such Option or
Convertible Security and the Common Shares deemed issuable upon exercise,
conversion or exchange thereof shall be deemed to have been issued as of the
date of such increase or decrease. No adjustment pursuant to this Section
2(a) shall be made if such adjustment would result in an increase of the
Exercise Price then in effect or a decrease in the number of Warrant Shares.




(iv) Calculation of Consideration Received. In case any Option
is issued in connection with the issue or sale of other securities of the
Company, together comprising one integrated transaction in which no specific
consideration is allocated to such Options by the parties thereto, the
Options will be deemed to have been issued for a consideration of $0.01. If
any Common Shares, Options or Convertible Securities are issued or sold or
deemed to have been issued or sold for cash, the consideration received
therefor will be deemed to be the net amount received by the Company
therefor. If any Common Shares, Options or Convertible Securities are
issued or sold for a consideration other than cash, the amount of such
consideration received by the Company will be the fair value of such
consideration, except where such consideration consists of securities, in
which case the amount of consideration received by the Company will be the
Closing Sale Price of such security on the date of receipt. If any Common
Shares, Options or Convertible Securities are issued to the owners of the
non-surviving entity in connection with any merger in which the Company is
the surviving entity, the amount of consideration therefor will be deemed to
be the fair value of such portion of the net assets and business of the
non-surviving entity as is attributable to such Common Shares, Options or
Convertible Securities, as the case may be. The fair value of any
consideration other than cash or securities will be determined jointly by
the Company and the Required Holders. If such parties are unable to reach
agreement within ten (10) days after the occurrence of an event requiring
valuation (the “Valuation Event”), the fair value of such consideration will
be determined within five (5) Business Days after the tenth day following
the Valuation Event by an independent, reputable appraiser jointly selected
by the Company and the Required Holders. The determination of such
appraiser shall be final and binding upon all parties absent manifest error
and the fees and expenses of such appraiser shall be borne by the Company.




(v) Record Date. If the Company takes a record of the holders
of Common Shares for the purpose of entitling them (A) to receive a dividend
or other distribution payable in Common Shares, Options or in Convertible
Securities or (B) to subscribe for or purchase Common Shares, Options or
Convertible Securities, then such record date will be deemed to be the date
of the issue or sale of the Common Shares deemed to have been issued or sold
upon the declaration of such dividend or the making of such other
distribution or the date of the granting of such right of subscription or
purchase, as the case may be.



(b) Adjustment upon Subdivision or Combination of Common Shares. If the Company at
any time on or after the Subscription Date subdivides (by any share split, share dividend,
recapitalization or otherwise) one or more classes of its outstanding Common Shares into a greater
number of shares, the Exercise Price in effect immediately prior to such subdivision will be
proportionately reduced and the number of Warrant Shares will be proportionately increased. If the
Company at any time on or after the Subscription Date combines (by combination, reverse share
split or otherwise) one or more classes of its outstanding Common Shares into a smaller number of
shares, the Exercise Price in effect immediately prior to such combination will be proportionately
increased and the number of Warrant Shares will be proportionately decreased. Any adjustment under
this Section 2(b) shall become effective at the close of business on the date the subdivision or
combination becomes effective.



(c) Other Events. If any event occurs of the type contemplated by the provisions of
this Section 2 but not expressly provided for by such provisions (including, without limitation,
the granting of share appreciation rights, phantom share rights or other rights with equity
features), then the Company’s Board of Directors will make an appropriate adjustment in the
Exercise Price and the number of Warrant Shares so as to protect the rights of the Holder; provided
that no such adjustment pursuant to this Section 2(c) will increase the Exercise Price or decrease
the number of Warrant Shares as otherwise determined pursuant to this Section 2.



3. RIGHTS UPON DISTRIBUTION OF ASSETS. If the Company shall declare or make any
dividend or other distribution of its assets (or rights to acquire its assets) to holders of Common
Shares, by way of return of capital or otherwise (including, without limitation, any distribution
of cash, shares or other securities, property or options by way of a dividend, spin off,
reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a
"Distribution”), at any time after the issuance of this Warrant, then, in each such case the
Exercise Price in respect of Warrants not exercised on or prior to the close of business on the
record date fixed for the determination of holders of Common Shares entitled to receive the
Distribution shall be reduced, effective as of the close of business on such record date, to a
price determined by multiplying such Exercise Price by a fraction of which (i) the numerator shall
be the arithmetic average of the Weighted Average Price (as defined in the SPA Securities) of the
Common Shares for the 10 Trading Days immediately preceding such record date minus the value of the
Distribution (as determined in good faith by the Company’s Board of Directors) applicable to one
Common Share, and (ii) the denominator shall be the arithmetic average of the Weighted Average
Price (as defined in the SPA Securities) of the Common Shares for the 10 Trading Days immediately
preceding such record date.



4. PURCHASE RIGHTS; FUNDAMENTAL TRANSACTIONS.



(a) Purchase Rights. In addition to any adjustments pursuant to Section 2 above, if
at any time the Company grants, issues or sells any Options, Convertible Securities or rights to
purchase shares, warrants, securities or other property pro rata to all of the record holders of
any class of Common Shares (the “Purchase Rights”), then the Holder will be entitled to acquire,
upon the terms applicable to such Purchase Rights and in lieu of any adjustments to which the
Holder is otherwise entitled under Section 3 above in respect of such Purchase Rights, the
aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of
Common Shares acquirable upon complete exercise of this Warrant (without regard to any limitations
on the exercise of this Warrant) immediately before the date on which a record is taken for the
grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of
which the record holders of Common Shares are to be determined for the grant, issue or sale of such
Purchase Rights.



(b) Fundamental Transactions. The Company shall not enter into or be party to a
Fundamental Transaction unless (i) the Successor Entity assumes in writing all of the obligations
of the Company under this Warrant and the other Transaction Documents in accordance with the
provisions of this Section (4)(b) pursuant to written agreements in form and substance satisfactory
to the Required Holders and approved by the Required Holders prior to such Fundamental Transaction,
including agreements to deliver to each holder of Warrants in exchange for such Warrants a security
of the Successor Entity evidenced by a written instrument substantially similar in form and
substance to this Warrant, including, without limitation, an adjusted exercise price equal to the
value for the Common Shares reflected by the terms of such Fundamental Transaction, and exercisable
for a corresponding number of shares of capital shares equivalent to the Common Shares acquirable
and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of
this Warrant) prior to such Fundamental Transaction, and satisfactory to the Required Holders and
(ii) subject to Section 4(c) below, the Successor Entity is a publicly traded corporation whose
common shares are quoted on or listed for trading on an Eligible Market (a “Public Successor”).
Upon the occurrence of any Fundamental Transaction, the Successor Entity shall succeed to, and be
substituted for (so that from and after the date of such Fundamental Transaction, the provisions of
this Warrant referring to the “Company” shall refer instead to the Successor Entity), and may
exercise every right and power of the Company and shall assume all of the obligations of the
Company under this Warrant with the same effect as if such Successor Entity had been named as the
Company herein. Upon consummation of the Fundamental Transaction, the Successor Entity shall
deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any
time after the consummation of the Fundamental Transaction, in lieu of the shares of the Common
Shares (or other securities, cash, assets or other property) purchasable upon the exercise of the
Warrant prior to such Fundamental Transaction, such shares, securities, cash, assets or any other
property whatsoever (including warrants or other purchase or subscription rights) which the Holder
would have been entitled to receive upon the happening of such Fundamental Transaction had this
Warrant been converted immediately prior to such Fundamental Transaction, as adjusted in accordance
with the provisions of this Warrant. In addition to and not in substitution for any other rights
hereunder, prior to the consummation of any Fundamental Transaction pursuant to which holders of
Common Shares are entitled to receive securities or other assets with respect to or in exchange for
Common Shares (a “Corporate Event”), the Company shall make appropriate provision to insure that
the Holder will thereafter have the right to receive upon an exercise of this Warrant at any time
after the consummation of the Fundamental Transaction but prior to the Expiration Date, in lieu of
the shares of the Common Shares (or other securities, cash, assets or other property) purchasable
upon the exercise of the Warrant prior to such Fundamental Transaction, such shares of shares,
securities, cash, assets or any other property whatsoever (including warrants or other purchase or
subscription rights) which the Holder would have been entitled to receive upon the happening of
such Fundamental Transaction had the Warrant been exercised immediately prior to such Fundamental
Transaction; provided, however, that in the event that, pursuant to the terms of the Fundamental
Transaction, the holders of Common Shares may elect the consideration to be received in exchange
for the Common Shares in the such Fundamental Transaction, the Holder shall elect, within the same
time periods as provided to the holders of Common Shares, the kind or amount of such shares,
securities, cash, assets or any other property (including warrants or other purchase or
subscription rights) that the Holder will, following the consummation of such transaction, be
entitled to receive upon exercise; provided, further, however, that no such election by the Holder
shall be construed to require the exercise of this Warrant in connection with such Fundamental
Transaction. If the Holder is required to make any election of the kind described in the foregoing
sentence, the Company shall deliver to the Holder all documentation, informational materials and
election forms relating to such Fundamental Transaction contemporaneously with the delivery of such
documentation, materials and forms to the holders of the Common Shares. Provision made pursuant to
the preceding sentence shall be in a form and substance reasonably satisfactory to the Required
Holders. The provisions of this Section shall apply similarly and equally to successive
Fundamental Transactions and Corporate Events and shall be applied without regard to any
limitations on the exercise of this Warrant.



(c) Notwithstanding the foregoing and the provisions of Section 4(b) above, in the event of a
Fundamental Transaction where the Successor Entity (and not the Parent Entity) is not a Public
Successor, if the Holder has not exercised the Warrant in full prior to the consummation of the
Fundamental Transaction, then the Company may enter into a Fundamental Transaction pursuant to
which the Holder shall receive, simultaneously with the consummation of the Fundamental
Transaction, in lieu of the warrant referred to in Section 4(b) cash in an amount equal to the
value of the remaining unexercised portion of this Warrant on the date of such consummation, which
value shall be determined by use of the Black and Scholes Option Pricing Model reflecting (i) a
risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining
term of this Warrant as of such date of request and (ii) an expected volatility equal to the
greater of 60% and the 100 day volatility obtained from the HVT function on Bloomberg.



5. NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company will
not, by amendment of its Articles of Incorporation, Bylaws or through any reorganization, transfer
of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities,
or any other voluntary action, avoid or seek to avoid the observance or performance of any of the
terms of this Warrant, and will at all times in good faith carry out all the provisions of this
Warrant and take all action as may be required to protect the rights of the Holder. Without
limiting the generality of the foregoing, the Company (i) shall take all such actions as may be
reasonably necessary or appropriate in order that the Company may validly and legally issue fully
paid and non-assessable Common Shares upon the exercise of this Warrant, and (ii) shall, so long as
any of the SPA Warrants are outstanding, take all reasonable action necessary to reserve and keep
available out of its authorized and unissued Common Shares, solely for the purpose of effecting the
exercise of the SPA Warrants, the requisite number of Common Shares as shall from time to time be
necessary to effect the exercise of the SPA Warrants then outstanding (without regard to any
limitations on exercise).



6. WARRANT HOLDER NOT DEEMED A SHAREHOLDER. Except as otherwise specifically
provided herein, the Holder, solely in such Person’s capacity as a holder of this Warrant, shall
not be entitled to vote or receive dividends or be deemed the holder of share capital of the
Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon
the Holder, solely in such Person’s capacity as the Holder of this Warrant, any of the rights of a
shareholder of the Company or any right to vote, give or withhold consent to any corporate action
(whether any reorganization, issue of shares, reclassification of shares, consolidation, merger,
conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or
otherwise, prior to the issuance to the Holder of the Warrant Shares which such Person is then
entitled to receive upon the due exercise of this Warrant. In addition, nothing contained in this
Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities
(upon exercise of this Warrant or otherwise) or as a shareholder of the Company, whether such
liabilities are asserted by the Company or by creditors of the Company. Notwithstanding this
Section 6, the Company shall provide the Holder with copies of the same notices and other
information given to the shareholders of the Company generally, contemporaneously with the giving
thereof to the shareholders.



7. REISSUANCE OF WARRANTS.



(a) Transfer of Warrant. If this Warrant is to be transferred, the Holder shall
surrender this Warrant to the Company, whereupon the Company will forthwith issue and deliver upon
the order of the Holder a new Warrant (in accordance with Section 7(d)), registered as the Holder
may request, representing the right to purchase the number of Warrant Shares being transferred by
the Holder and, if less then the total number of Warrant Shares then underlying this Warrant is
being transferred, a new Warrant (in accordance with Section 7(d)) to the Holder representing the
right to purchase the number of Warrant Shares not being transferred.



(b) Lost, Stolen or Mutilated Warrant. Upon receipt by the Company of evidence
reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this
Warrant, and, in the case of loss, theft or destruction, of any indemnification undertaking by the
Holder to the Company in customary form and, in the case of mutilation, upon surrender and
cancellation of this Warrant, the Company shall execute and deliver to the Holder a new Warrant (in
accordance with Section 7(d)) representing the right to purchase the Warrant Shares then underlying
this Warrant.



(c) Exchangeable for Multiple Warrants. This Warrant is exchangeable, upon the
surrender hereof by the Holder at the principal office of the Company, for a new Warrant or
Warrants (in accordance with Section 7(d)) representing in the aggregate the right to purchase the
number of Warrant Shares then underlying this Warrant, and each such new Warrant will represent the
right to purchase such portion of such Warrant Shares as is designated by the Holder at the time of
such surrender; provided, however, that no Warrants for fractional Common Shares shall be given.



(d) Issuance of New Warrants. Whenever the Company is required to issue a new Warrant
pursuant to the terms of this Warrant, such new Warrant (i) shall be of like tenor with this
Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right to purchase
the Warrant Shares then underlying this Warrant (or in the case of a new Warrant being issued
pursuant to Section 7(a) or Section 7(c), the Warrant Shares designated by the Holder which, when
added to the number of Common Shares underlying the other new Warrants issued in connection with
such issuance, does not exceed the number of Warrant Shares then underlying this Warrant), (iii)
shall have an issuance date, as indicated on the face of such new Warrant which is the same as the
Issuance Date, and (iv) shall have the same rights and conditions as this Warrant.



8. NOTICES. Whenever notice is required to be given under this Warrant, unless
otherwise provided herein, such notice shall be given in accordance with Section 9(f) of the
Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice of
all actions taken pursuant to this Warrant, including in reasonable detail a description of such
action and the reason therefore. Without limiting the generality of the foregoing, the Company
will give written notice to the Holder (i) immediately upon any adjustment of the Exercise Price,
setting forth in reasonable detail, the calculation of such adjustment and (ii) at least seven days
prior to the date on which the Company closes its books or takes a record (A) with respect to any
dividend or distribution upon the Common Shares, (B) with respect to any grants, issuances or sales
of any Options, Convertible Securities or rights to purchase shares, warrants, securities or other
property to all holders of Common Shares or (C) for determining rights to vote with respect to any
Fundamental Transaction, dissolution or liquidation, provided in each case that such information
shall be made known to the public prior to or in conjunction with such notice being provided to the
Holder.



9. AMENDMENT AND WAIVER. Except as otherwise provided herein, the provisions of this
Warrant may be amended and the Company may take any action herein prohibited, or omit to perform
any act herein required to be performed by it, only if the Company has obtained the written consent
of the Required Holders; provided that no such action may increase the exercise price of any SPA
Warrant or decrease the number of shares or class of shares obtainable upon exercise of any SPA
Warrant without the written consent of the Holder. No such amendment shall be effective to the
extent that it applies to less than all of the holders of the SPA Warrants then outstanding.



10. GOVERNING LAW. This Warrant shall be governed by and construed and enforced in
accordance with, and all questions concerning the construction, validity, interpretation and
performance of this Warrant shall be governed by, the internal laws of the State of New York,
without giving effect to any choice of law or conflict of law provision or rule (whether of the
State of New York or any other jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York. Any action brought by either party against the
other concerning the transactions contemplated by this Agreement shall be brought only in the state
courts of New York or in the federal courts located in the State of New York and waive trial by
jury. Both parties agree to submit to the jurisdiction of such courts. The prevailing party shall
be entitled to recover from the other party its reasonable attorney’s fees and costs. In the event
that any provision of this Warrant is invalid or unenforceable under any applicable statute or rule
of law, then such provision shall be deemed inoperative to the extent that it may conflict
therewith and shall be deemed modified to conform with such statute or rule of law. Any such
provision which may prove invalid or unenforceable under any law shall not affect the validity or
enforceability of any other provision of this Warrant. Nothing contained herein shall be deemed or
operate to preclude the Holder from bringing suit or taking other legal action against the Company
in any other jurisdiction to collect on the Company’s obligations to the Holder, to realize on any
collateral or any other security for such obligations, or to enforce a judgment or other court
ruling in favour of the Holder.



11. JUDGMENT CURRENCY.



(a) If for the purpose of obtaining or enforcing judgment against the Company in any court in
any jurisdiction it becomes necessary to convert into any other currency (such other currency being
hereinafter in this Section 11 referred to as the “Judgment Currency”) an amount due in US dollars
under this Warrant, the conversion shall be made at the Exchange Rate prevailing on the business
day immediately preceding:




(i) the date actual payment of the amount due, in the case of any
proceeding in the courts of New York or in the courts of any other
jurisdiction that will give effect to such conversion being made on
such date: or


(ii) the date on which the foreign court determines, in the case of
any proceeding in the courts of any other jurisdiction (the date as
of which such conversion is made pursuant to this Section 11(a)(ii)
being hereinafter referred to as the “Judgment Conversion Date”).



(b) If in the case of any proceeding in the court of any jurisdiction referred to in Section
11(a)(ii) above, there is a change in the Exchange Rate prevailing between the Judgment Conversion
Date and the date of actual payment of the amount due, the applicable party shall pay such adjusted
amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted
at the Exchange Rate prevailing on the date of payment, will produce the amount of US dollars which
could have been purchased with the amount of Judgment Currency stipulated in the judgment or
judicial order at the Exchange Rate prevailing on the Judgment Conversion Date.



(c) Any amount due from the Company under this provision shall be due as a separate debt and
shall not be affected by judgment being obtained for any other amounts due under or in respect of
this Warrant.



12. CURRENCY. All amounts owing under this Warrant or any Transaction Document that,
in accordance with their terms, are paid in cash shall be paid in US dollars. All amounts
denominated in other currencies shall be converted in the US dollar equivalent amount in accordance
with the Exchange Rate on the date of calculation (for the purpose of Section 2 hereof, the date of
calculation shall equal the date of such event resulting in the adjustment of the Exercise Price
thereunder). “Exchange Rate” means, in relation to any amount of currency to be converted into US
dollars pursuant to this Warrant, the US dollar exchange rate as published in the Wall Street
Journal on the relevant date of calculation.



13. TAXES.



(a) Any and all payments by the Company hereunder, including any amounts received on an
exercise of this Warrant and any amounts on account of interest or deemed interest, shall be made
free and clear of and without deduction for any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect thereto, imposed under Part
XIII of the Income Tax Act (Canada) (collectively referred to as “Part XIII Taxes”). If the
Company shall be required to deduct any Part XIII Taxes from or in respect of any sum payable
hereunder to the Holder, (i) the sum payable shall be increased by one-half of the amount by which
the sum payable would otherwise have to be increased (the “make-whole amount”) to ensure that after
making all required deductions (including deductions applicable to the make-whole amount) the
Holder would receive an amount equal to the sum it would have received had no such deductions been
made, (ii) the Company shall make such deductions and (iii) the Company shall pay the full amount
withheld or deducted to the Canada Revenue Agency within the time required. For example, assuming
that the Company is required to deduct 25% of a $100 interest payment hereunder, the Company shall
be required to increase such payment by $16.67.



(b) In addition, the Company agrees to pay to the relevant governmental authority in
accordance with applicable law any present or future stamp or documentary taxes or any other excise
or property taxes, charges or similar levies that arise from any payment made hereunder or in
connection with the execution, delivery, registration or performance of, or otherwise with respect
to, this Warrant (“Other Taxes”). The Company shall deliver to the Holder official receipts, if
any, in respect of any Part XIII Taxes and Other Taxes payable hereunder promptly after payment of
such Part XIII Taxes, Other Taxes or other evidence of payment reasonably acceptable to the Holder.



(c) The obligations of the Company under this Section 13(c) shall survive the termination of
this Warrant and the exercise of this Warrant and all other amounts payable hereunder.



14. MAXIMUM PAYMENTS. Nothing contained herein shall be deemed to establish or
require the payment of a rate of interest or other charges in excess of the maximum permitted by
applicable law. In the event that the rate of interest required to be paid or other charges
hereunder exceed the maximum permitted by such law, any payments in excess of such maximum shall be
credited against amounts owed by the Company to the Holder and thus refunded to the Company.



15. CONSTRUCTION; HEADINGS. This Warrant shall be deemed to be jointly drafted by the
Company and all the Buyers and shall not be construed against any person as the drafter hereof.
The headings of this Warrant are for convenience of reference and shall not form part of, or affect
the interpretation of, this Warrant.



16. DISPUTE RESOLUTION. In the case of a dispute as to the determination of the
Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall submit the
disputed determinations or arithmetic calculations via facsimile within two (2) Business Days of
receipt of the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If
the Holder and the Company are unable to agree upon such determination or calculation of the
Exercise Price or the Warrant Shares within three (3) Business Days of such disputed determination
or arithmetic calculation being submitted to the Holder, then the Company shall, within two (2)
Business Days submit via facsimile (a) the disputed determination of the Exercise Price to an
independent, reputable investment bank selected by the Company and approved by the Holder or (b)
the disputed arithmetic calculation of the Warrant Shares to the Company’s independent, outside
accountant. The Company shall cause at its expense the investment bank or the accountant, as the
case may be, to perform the determinations or calculations and notify the Company and the Holder of
the results no later than ten (10) Business Days from the time it receives the disputed
determinations or calculations. Such investment bank’s or accountant’s determination or
calculation, as the case may be, shall be binding upon all parties absent demonstrable error. In
the event the Company’s determination or calculation is correct, the expenses of the investment
bank or accountant, as the case may be, shall be borne by the Holder.



17. REMEDIES, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies
provided in this Warrant shall be cumulative and in addition to all other remedies available under
this Warrant and the other Transaction Documents, at law or in equity (including a decree of
specific performance and/or other injunctive relief), and nothing herein shall limit the right of
the Holder right to pursue actual damages for any failure by the Company to comply with the terms
of this Warrant. The Company acknowledges that a breach by it of its obligations hereunder will
cause irreparable harm to the Holder and that the remedy at law for any such breach may be
inadequate. The Company therefore agrees that, in the event of any such breach or threatened
breach, the holder of this Warrant shall be entitled, in addition to all other available remedies,
to an injunction restraining any breach, without the necessity of showing economic loss and without
any bond or other security being required.



18. TRANSFER. This Warrant may be offered for sale, sold, transferred or assigned
without the consent of the Company, except as may otherwise be required by Section 2(f) of the
Securities Purchase Agreement.



19. CERTAIN DEFINITIONS. For purposes of this Warrant, the following terms shall have
the following meanings:



(a) "Bloomberg” means Bloomberg Financial Markets.



(b) "Business Day” means any day other than Saturday, Sunday or other day on which commercial
banks in The City of New York are authorized or required by law to remain closed.



(c) "Closing Bid Price” and “Closing Sale Price” means, for any security as of any date, the
last closing bid price and last closing trade price, respectively, for such security on the
Principal Market, as reported by Bloomberg or by the Principal Market, or, if the Principal Market
begins to operate on an extended hours basis and does not designate the closing bid price or the
closing trade price, as the case may be, then the last bid price or last trade price, respectively,
of such security prior to 4:00:00 p.m., New York Time, as reported by Bloomberg or by the Principal
Market, or, if the Principal Market is not the principal securities exchange or trading market for
such security, the last closing bid price or last trade price, respectively, of such security on
the principal securities exchange or trading market where such security is listed or traded as
reported by Bloomberg or by the Principal Market, or if the foregoing do not apply, the last
closing bid price or last trade price, respectively, of such security in the over-the-counter
market on the electronic bulletin board for such security as reported by Bloomberg or by the
Principal Market, or, if no closing bid price or last trade price, respectively, is reported for
such security by Bloomberg or by the Principal Market, the average of the bid prices, or the ask
prices, respectively, of any market makers for such security as reported in the “pink sheets” by
Pink Sheets LLC (formerly the National Quotation Bureau, Inc.). If the Closing Bid Price or the
Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing
bases, the Closing Bid Price or the Closing Sale Price, as the case may be, of such security on
such date shall be the fair market value as mutually determined by the Company and the Holder. If
the Company and the Holder are unable to agree upon the fair market value of such security, then
such dispute shall be resolved pursuant to Section 15. All such determinations to be appropriately
adjusted for any share dividend, share split, share combination or other similar transaction during
the applicable calculation period.



(d) "Common Shares” means (i) the Company’s Common Shares, no par value per share, and (ii)
any share capital into which such Common Shares shall have been changed or any share capital
resulting from a reclassification of such Common Shares.



(e) “Common Shares Deemed Outstanding” means, at any given time, the number of Common Shares
actually outstanding at such time, plus the number of Common Shares deemed to be outstanding
pursuant to Sections 2(a)(i) and 2(a)(ii) hereof regardless of whether the Options or Convertible
Securities are actually exercisable at such time, but excluding any Common Shares owned or held by
or for the account of the Company or issuable upon conversion and exercise, as applicable, of the
SPA Securities and the Warrants.



(f) "Convertible Securities” means any shares or securities (other than Options) directly or
indirectly convertible into or exercisable or exchangeable for Common Shares.



(g) "Eligible Market” means the Principal Market, The New York Stock Exchange, Inc., the
American Stock Exchange, the Nasdaq National Market or The Nasdaq SmallCap Market.



(h) "Expiration Date” means the date sixty (60) months after the Issuance Date or, if such
date falls on a day other than a Business Day or on which trading does not take place on the
Principal Market (a “Holiday”), the next date that is not a Holiday.



(i) "Fundamental Transaction” means that the Company shall, directly or indirectly, in one or
more related transactions, (i) consolidate or merge with or into (whether or not the Company is the
surviving corporation) another Person, or (ii) sell, assign, transfer, convey or otherwise dispose
of all or substantially all of the properties or assets of the Company to another Person, or (iii)
allow another Person to make a purchase, tender or exchange offer that is accepted by the holders
of more than the 50% of the outstanding Common Shares (not including any Common Shares held by the
Person or Persons making or party to, or associated or affiliated with the Persons making or party
to, such purchase, tender or exchange offer), or (iv) consummate a share purchase agreement or
other business combination (including, without limitation, a reorganization, recapitalization,
spin-off or scheme of arrangement) with another Person whereby such other Person acquires more than
the 50% of the outstanding Common Shares (not including any Common Shares held by the other Person
or other Persons making or party to, or associated or affiliated with the other Persons making or
party to, such share purchase agreement or other business combination), or (v) reorganize,
recapitalize or reclassify its Common Shares. For the avoidance of doubt, and notwithstanding the
foregoing, the Company may create new Subsidiaries, including trusts the sole trustees of which are
members of the Company’s Board of Directors, and transfer any assets of any kind or nature to
either its existing Subsidiaries or to any new Subsidiaries, and neither the creation of any such
new Subsidiaries nor the transfer of assets to existing or new Subsidiaries shall be deemed a
Fundamental Transaction so long as, concurrently with any such transactions, the Company causes
such existing Subsidiaries or new Subsidiaries to grant a security interest and/or hypothec in
accordance with the security arrangements referenced in Section 10 of the SPA Securities to the
extent required.



(j) "Options” means any rights, warrants or options to subscribe for or purchase Common Shares
or Convertible Securities.



(k) "Parent Entity” of a Person means an entity that, directly or indirectly, controls the
applicable Person and whose common shares or equivalent equity security is quoted or listed on an
Eligible Market, or, if there is more than one such Person or Parent Entity, the Person or Parent
Entity with the largest public market capitalization as of the date of consummation of the
Fundamental Transaction.



(l) "Person” means an individual, a limited liability company, a partnership, a joint venture,
a corporation, a trust, an unincorporated organization, any other entity and a government or any
department or agency thereof.



(m) "Principal Market” means the Toronto Stock Exchange.



(n) "Required Holders” means the holders of the SPA Warrants representing at least a majority
of Common Shares underlying the SPA Warrants then outstanding.



(o) "SPA Securities” means the Notes issued pursuant to the Securities Purchase Agreement.



(p) "Successor Entity” means the Person (or, if so elected by the Required Holders, the Parent
Entity) formed by, resulting from or surviving any Fundamental Transaction or the Person (or, if so
elected by the Required Holders, the Parent Entity) with which such Fundamental Transaction shall
have been entered into.



[Signature Page Follows]




1




IN WITNESS WHEREOF, the Company has caused this Warrant to Purchase Common Shares to be
duly executed as of the Issuance Date set out above.




ART ADVANCED RESEARCH TECHNOLOGIES INC.



By:



Name:



Title:



2




EXHIBIT A



EXERCISE NOTICE

TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS

WARRANT TO PURCHASE COMMON SHARES




ART ADVANCED RESEARCH TECHNOLOGIES INC.




The undersigned holder hereby exercises the right to purchase      of the
Common Shares (“Warrant Shares”) of ART Advanced Research Technologies Inc., a Canadian corporation
(the “Company”), evidenced by the attached Warrant to Purchase Common Shares (the “Warrant”).
Capitalized terms used herein and not otherwise defined shall have the respective meanings set
forth in the Warrant.



1. Payment of Exercise Price. The holder shall pay the Aggregate Exercise Price in the sum
of $     to the Company in accordance with the terms of the Warrant.



2. Delivery of Warrant Shares. The Company shall deliver to the holder      Warrant
Shares to      1in accordance with the terms of the Warrant.



Notwithstanding anything to the contrary contained herein, this Exercise Notice shall
constitute a representation and warranty by the undersigned that, after giving effect to the
exercise provided for in this Exercise Notice, the undersigned (together with its affiliates) will
not have beneficial ownership (together with the beneficial ownership of such Person’s affiliates)
of a number of Common Shares which exceeds the Maximum Percentage. It shall also constitute a
representation and warranty by the undersigned that all of the representations and warranties set
forth in Section 2 of the Securities Purchase Agreement, modified as if all of the references
therein to the Notes and Warrants were references to Warrant Shares, are true and correct as of the
date hereof.



Date:      ,      



Name of Registered Holder



By:



Name:



Title:



1 To insert account of holder for delivery of
Warrant Shares.



3



ACKNOWLEDGMENT




The Company hereby acknowledges this Exercise Notice and hereby directs National Bank Trust to
issue the above indicated number of Common Shares in accordance with the Transfer Agent
Instructions dated July 28, 2005 from the Company and acknowledged and agreed to by National Bank
Trust.




ART ADVANCED RESEARCH TECHNOLOGIES INC.



By:



Name:



Title:




4