EMPLOYMENT
      AGREEMENT

     

    THIS
      EMPLOYMENT AGREEMENT
      (the
“Agreement”) is made as of this 1st
      day of
      July 2005, by Coda Octopus Group, Inc., a Delaware corporation (Coda Octopus
      Group, Inc. and its subsidiaries hereinafter referred to as “Coda Octopus”),
      with its principal place of business at 245 Park Avenue, New York, New York
      10167 and Anthony Davis, residing in 19 Spring Gardens, Edinburgh EH8 8KU (“the
“Executive”) (collectively the "Parties").

     

    WHEREAS,
      the
      Parties desire to enter into the Agreement to reflect the Executive’s executive
      capacities in Coda Octopus’ business and to provide for Coda Octopus’s
      employment of the Executive; and

     

    WHEREAS,
      the
      Parties wish to set forth the terms and conditions of that
      employment;

     

    NOW
      THEREFORE,
      in
      consideration of the mutual covenants and promises contained herein, and other
      good and valuable consideration, the receipt and sufficiency of which are hereby
      acknowledged by the Parties, the Parties agree as follows:

     

    
      	
              1.
                

            	
              Term
                of Employment

            


    

     

    
      	 	
              Coda
                Octopus hereby employs the Executive, and the Executive hereby accepts
                employment with Coda Octopus, upon the terms and conditions set forth
                in
                this Agreement, for a term (the “Employment Period”) commencing on the
                date hereof until terminated pursuant to Section 5.
                

            


    

     

    
      	
              2.
                

            	
              Title;
                Duties

            


    

     

    
      	 	
              During
                the Employment Period, the Executive shall be employed in the business
                of
                Coda Octopus including its affiliates. The Executive shall serve
                as Vice
                President, Commercial Division (see Appendix A for description of
                duties).
                In addition to the duties set forth in Appendix A, the Executive
                shall
                perform such services consistent with his position and as may be
                assigned
                to him from time to time by Coda Octopus.


            


    

     

    
      	
              3.
                

            	
              Extent
                of Services

            


    

     

    
      	 	
              The
                Executive will not to engage in the management of any business activities
                during the Employment Period except those which are for the sole
                benefit
                of Coda Octopus and to devote his entire business time, attention,
                skill
                and effort to the performance of his duties under this Agreement.
                Notwithstanding the foregoing, the Executive may, without impairing
                or
                otherwise adversely affecting the Executive’s performance of his duties to
                Coda Octopus, (i) make and manage personal investments in accordance
                with
                the Company’s Personal Securities Account Information Sheet in place at
                the time and (ii) with the prior approval of Coda Octopus, engage
                in
                charitable, professional and civic activities and serve on the boards
                of
                directors of corporations other than Coda Octopus, provided, however,
                that
                no such approval shall be necessary for the Executive’s continued
                engagement in such charitable, professional and civic activities
                in which
                he was engaged and service on any board of directors on which he
                was
                serving, on the date of this Agreement, all of which have been previously
                disclosed to Coda Octopus in writing but, provided further, that
                in no
                event shall the Executive be permitted to serve on the board of directors
                of any other entity that owns, operates, acquires, sells, develops
                and/or
                manages any companies which is involved in sub sea or sonar inspection
                or
                visualization.

            


    

     

    
      
        
        

      

      
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              4.
                

            	
              Compensation
                and Benefits

            


    

     

    
      	
              (a)
                

            	
              Salary.
                Coda Octopus shall pay the Executive an initial gross base annual
                salary
                (“Base Salary”) of £80,000 (or $150,000 when relocated to the US)
                commencing July 1st,
                2005. The Base Salary shall be payable (minus such deductions as
                may be
                required by law or reasonably requested by the Executive) in accordance
                with Coda Octopus’s regularly scheduled payroll dates but in no event less
                frequently than monthly. If the Executive is an Officer of the parent
                company, Coda Octopus’s Compensation Committee (the “Compensation
                Committee”), or alternatively Coda Octopus, shall review the Executive’s
                Base Salary annually and may increase (but not decrease) the Executive’s
                Base Salary as in effect from time to time as the Compensation Committee
                shall deem appropriate.

            


    

     

    
      	
              (b)
                

            	
              Incentive
                Compensation.
                Commencing with calendar year 2006, the Executive shall be entitled
                to
                receive an annual cash and/or stock incentive bonus (the “Incentive
                Bonus”) for each Coda Octopus financial year during the Employment Period
                based on the level of accomplishment of management and performance
                objectives as established by the Compensation Committee.
                

            


    

     

    
      	
              (c)
                

            	
              Paid
                Time Off and Other Benefits.
                The Executive shall be entitled to paid time off for a minimum of
                35
                business days each calendar year, which shall be accrued ratably
                during
                the calendar year, as well as holiday pay in accordance with Coda
                Octopus’s policies in effect from time to time as set forth in its
                employment handbook as the same may be modified from time to time.
                The
                Executive shall be eligible to participate in such life, health,
                and
                disability insurance, pension, deferred compensation and incentive
                plans,
                options and awards, performance bonuses and other benefits as Coda
                Octopus
                extends, as a matter of policy, to its executive employees. The Coda
                Octopus shall maintain a disability insurance policy or plan covering
                the
                Executive during the Employment
                Period.

            


    

     

    
      	
              (d)
                

            	
              Reimbursement
                of Business Expenses.
                Coda Octopus shall reimburse the Executive for all reasonable travel,
                entertainment and other expenses incurred or paid by the Executive
                in
                connection with, or related to, the performance of his duties,
                responsibilities or services under this Agreement, upon presentation
                by
                the Executive of documentation, expense statements, vouchers, and/or
                such
                other supporting information as Coda Octopus may reasonably
                request.

            


    

     

    
      	
              (e)
                

            	
              Initial
                Restricted Stock Grant.
                Provided that neither the Executive nor Coda Octopus has prior thereto
                given notice terminating this Agreement, the Executive shall, effective
                1
                November 2005 be issued 50,000 shares of common stock of Coda Octopus
                to
                be distributed quarterly, followed by $50,000 shares of common stock
                of
                Coda Octopus annually, from November 1st,
                2006. Certificates representing said shares will bear a restrictive
                legend
                stating that sale or other transfer of the shares be made only pursuant
                to
                an effective registration statement filed with the Securities and
                Exchange
                Commission or an exemption from such
                registration.

            


    

     

    
      	
              (f)

            	
              Car
                or Car Allowance and Relocation Allowance.
                Whilst based in the UK, the Executive shall be provided with a vehicle.
                On
                relocation to the US, Coda Octopus shall reimburse the Executive
                $5,000
                per annum in lieu of specific reimbursement expenses for use of a
                personal
                vehicle or the provision of a vehicle. In addition, Coda Octopus
                shall
                reimburse the Executive up to an amount to be agreed separately for
                relocation to the U.S., upon presentation by the Executive of
                documentation, expense statements, vouchers, and/or such other supporting
                information as Coda Octopus may reasonably
                request.

            


    

     

    
      
        
        

      

      
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              (g)

            	
              D&O
                Insurance Coverage.
                Subject to the terms of Coda Octopus’ directors and officers liability
                insurance policy, during and for a period of a maximum of three years
                after termination, the Executive shall be entitled to director and
                officer
                insurance coverage for his acts and omissions while an officer and
                director of Coda Octopus on a basis no less favorable to him than
                the
                coverage provided current officers and
                directors.

            


    

     

    
      	
              5.
                

            	
              Termination

            


    

     

    
      	
              (a)
                

            	
              Termination
                by Coda Octopus.
                Coda Octopus may terminate the Executive’s employment under this Agreement
                at any time upon 90 days’ prior written notice to the Executive; provided
                that Coda Octopus may terminate the Executive’s employment under this
                Agreement at any time for Cause, upon written notice by Coda Octopus
                to
                the Executive. For purposes of this Agreement, “Cause” for termination
                shall mean a determination by Coda Octopus in good faith that any
                of the
                following events have occurred: (i) the conviction or indictment
                of the
                Executive of, or the entry of a plea of guilty or nolo contendere
                by the
                Executive to, any felony; (ii) fraud, misappropriation or embezzlement
                by
                the Executive; (iii) the Executive’s willful failure or gross negligence
                in the performance of his assigned duties for Coda Octopus, which
                failure
                or gross negligence continues for more than 15 days following the
                Executive’s receipt of written notice of such willful failure or gross
                negligence from Coda Octopus; (iv) any act or omission of the Executive
                that has a demonstrated and material adverse impact on Coda Octopus’s
                reputation for honesty and fair dealing; (v) the breach by the Executive
                of his duties under this Agreement or any material term of this Agreement;
                or (vi) a material violation by Executive of Coda Octopus’s employment
                policies which continues for more than 15 days following written
                notice of
                such violation from Coda Octopus.

            


    

     

    
      	
              (b)
                

            	
              Termination
                by the Executive without Good Reason.
                The Executive may terminate this Agreement at any time without Good
                Reason, upon giving Coda Octopus 90 days’ written notice. At Coda Octopus'
                sole discretion, it may substitute 90 days’ salary in lieu of notice. Any
                salary paid to the Executive in lieu of notice shall not be offset
                against
                any entitlement the Executive may have to the Severance Payment pursuant
                to Section 6(b).

            


    

     

    
      	
              (c)
                

            	
              Termination
                by Executive for Good Reason.
                The Executive may terminate his employment under this Agreement at
                any
                time for Good Reason, upon written notice by the Executive to Coda
                Octopus. For purposes of this Agreement, “Good Reason” for termination
                shall mean that the Executive has complied with the “Good Reason Process”
                (hereafter defined) following the occurrence of one of the following
                events, without the Executive’s consent: (i) the assignment to the
                Executive of substantial duties or responsibilities inconsistent
                with the
                Executive’s position at Coda Octopus, or any other action by Coda Octopus
                which results in a substantial diminution or other substantive adverse
                change in the Executive’s duties or responsibilities, including, but not
                limited to, a substantial diminution in the Executive’s title as set forth
                in Section 2 hereof; (ii) a requirement that the Executive work
                principally from a location outside the 50 mile radius from Coda
                Octopus’s
                address first written above, without prior agreement with the Executive;
                (iii) Coda Octopus’s failure to pay the Executive any Base Salary or other
                compensation to which he becomes entitled, other than an inadvertent
                failure which is remedied by Coda Octopus within 30 days after receipt
                of
                written notice thereof from the Executive (or ten days for failure
                to pay
                Base Salary); (iv) Coda Octopus’s failure to honor the initial equity
                award granted pursuant to Section 4(e), if applicable; (v) any reduction
                in the Executive’s aggregate Base Salary and any involuntary reduction in
                the Executive’s other compensation taken as a whole, excluding any
                reductions caused by the failure to achieve performance targets;
                or (vi)
                Coda Octopus’s material breach of any of its other material obligations
                under this Agreement. “Good Reason Process” shall mean that (i) Executive
                reasonably determines in good faith that a “Good Reason” event has
                occurred; (ii) Executive notifies Coda Octopus in writing of the
                occurrence of the Good Reason event; (iii) Executive cooperates in
                good
                faith with Coda Octopus’s efforts, for a period not less than 30 days
                following such notice, to modify Executive’s employment situation in a
                manner acceptable to Executive and Coda Octopus; and (iv) notwithstanding
                such efforts, one or more of the Good Reason events continues to
                exist and
                has not been modified in a manner acceptable to Executive. If Coda
                Octopus
                cures the Good Reason event in a manner acceptable to Executive during
                the
                30 day period, Good Reason shall be deemed not to have
                occurred.

            


    

     

    
      
        
        

      

      
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              (d)
                

            	
              Executive’s
                Death or Disability.
                The Executive’s employment shall terminate immediately upon his death or,
                upon written notice as set forth below, his Disability. As used in
                this
                Agreement, “Disability” shall mean such physical or mental impairment as
                would render the Executive eligible to receive benefits under the
                long-term disability insurance policy or plan then made available
                by Coda
                Octopus to the Executive. If the Employment Period is terminated
                by reason
                of the Executive’s Disability, either party shall give 30 days’ advance
                written notice to that effect to the
                other.

            


    

     

    
      	
              (e)
                

            	
              Date
                of Termination.
                “Date of Termination” shall mean: (A) if Executive’s employment is
                terminated by his death, the date of his death; (B) if Executive’s
                employment is terminated on account of disability under Section 5(d),
                90
                days after the date on which a notice of termination is given; (C)
                if
                Executive’s employment is terminated by Coda Octopus for Cause under
                Section 5(a), the date on which notice of termination is given; (D)
                if
                Executive’s employment is terminated under Section 5(b), 90 days after the
                date on which a notice of termination is given; and (E) if Executive’s
                employment is terminated by Executive under Section 5(c), 30 days
                after
                the date on which a notice of Good Reason is
                given.

            


    

     

    
      	
              6.
                

            	
              Effect
                of Termination

            


    

     

    
      	
              (a)
                

            	
              General.
                Regardless of the reason for any termination of this Agreement, the
                Executive (or the Executive’s estate if the Employment Period ends on
                account of the Executive’s death) shall be entitled to: (i) any unpaid
                portion of his Base Salary through the Date of Termination unless
                otherwise stated below; (ii) reimbursement for any outstanding reasonable
                expense he has incurred hereunder; (iii) continued insurance benefits
                to
                the extent required by law; (iv) payment of any vested but unpaid
                rights
                as required independent of this Agreement by the terms of any bonus
                or
                other incentive pay or stock plan, or any other employee benefit
                plan or
                program of Coda Octopus; and (v) except in the case of “Termination by
                Coda Octopus for Cause,” any bonus or incentive compensation that was
                approved but not paid. The amount payable under this Section 6(a)
                shall be
                paid to the Executive or the Executive’s estate (in the event of the
                Executive’s death) in a single lump sum no later than 30 days after the
                Date of Termination.

            


    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	
              (b)
                

            	
              Termination
                by Coda Octopus for Cause or by Executive without Good
                Reason.
                If
                Coda Octopus terminates the Executive’s employment for Cause or the
                Executive terminates his employment without Good Reason, the Executive
                shall have no rights or claims against Coda Octopus except to receive
                the
                payments and benefits described in Section 6(a). Coda Octopus shall
                have
                no further obligations to Executive except as otherwise expressly
                provided
                under this Agreement, provided any such termination shall not adversely
                affect or alter Executive’s rights under any employee benefit plan of Coda
                Octopus in which Executive, at the Date of Termination, has a vested
                interest, unless otherwise provided in such employee benefit plan
                or any
                agreement or other instrument attendant thereto. In addition, all
                vested
                but unexercised stock options held by Executive as of the Date of
                Termination must be exercised by Executive within three months following
                the Date of Termination or by the end of the option term, if earlier.
                All
                other stock-based grants and awards held by Executive shall vest
                or be
                canceled upon the Date of Termination in accordance with their
                terms.

            


    

     

    
      	
              (c)
                

            	
              Termination
                by Coda Octopus without Cause or by Executive for Good
                Reason.
                Except as provided in Section 6(d), if Coda Octopus terminates the
                Executive’s employment without Cause, or the Executive terminates his
                employment for Good Reason pursuant to Section 5(c), the Executive
                shall
                be entitled to receive, in addition to the items referenced in Section
                6(a), the following:

            


    

     

    
      	 	
              (i)
                

            	
              a
                lump sum payment equal to one times the sum of (x) the Executive’s then
                current Base Salary and (y) the greater of (A) the average of the
                Executive’s bonuses (taking into account a payment of no bonus or a
                payment of a bonus of $0) with respect to the preceding three fiscal
                years
                (or the period of the Executive’s employment if shorter), (B) the
                Executive’s bonus with respect to the preceding fiscal year and (C) in the
                event that such termination of employment occurs before the first
                anniversary of the Commencement Date, the Executive’s annualized projected
                bonus for such year (the “Severance Payment”). The Severance Payment shall
                be paid to the Executive within 60 days following the Date of
                Termination;

            


    

     

    
      	 	
              (ii)
                

            	
              continued
                payment by Coda Octopus for life, health and disability insurance
                coverage
                and salary and other benefits for the Executive and the Executive’s spouse
                and dependents for one year following the Date of Termination to
                the same
                extent that Coda Octopus paid for such coverage immediately prior
                to the
                termination of the Executive’s employment and subject to the eligibility
                requirements and other terms and conditions of such insurance coverage,
                provided that if any such insurance coverage shall become unavailable
                during the one year period, Coda Octopus thereafter shall be obliged
                only
                to pay to the Executive an amount which, after reduction for income
                and
                employment taxes, is equal to the employer premiums for such insurance
                for
                the remainder of such severance period;
                and

            


    

     

    
      	 	
              (iii)
                

            	
              vesting
                as of the Date of Termination in any unvested portion of any stock
                option,
                restricted stock and any other long term incentive award previously
                issued
                to the Executive by Coda Octopus. Each such stock option must be
                exercised
                by the Executive within 180 days after the Date of Termination or
                the date
                of the remaining option term, if
                earlier.

            


    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
      	 	
              None
                of the benefits described in this Section 6(c) will be payable unless
                the
                Executive has signed a general release which has become irrevocable,
                satisfactory to Coda Octopus in the reasonable exercise of its discretion,
                releasing Coda Octopus, its affiliates including Coda Octopus, and
                their
                officers, directors and employees, from any and all claims or potential
                claims arising from or related to the Executive’s employment or
                termination of employment.

            


    

     

    
      	
              (d)
                

            	
              Termination
                Following Change in Control.
                If, (x) during the Employment Period and within 12 months following
                a
                Change in Control, Coda Octopus (or its successor) terminates the
                Executive’s employment without Cause pursuant to Section 5(a) or the
                Executive terminates his employment for Good Reason pursuant to Section
                5(c), or (y) the Executive, by notice given under this clause (y)
                of this
                Section 6(d) during the 90 day period commencing on the three-month
                anniversary of the date of the Change in Control (the “Notice Period”),
                terminates his employment for any reason, which termination shall
                be
                effective on the last day of the Notice Period, the Executive shall
                be
                entitled to receive, in addition to the items referenced in Section
                6(a),
                the following:

            


    

     

    
      	
            	(i)	
              the
                items referenced in Section 6(c);
                and

            


    

     

    
      	
            	(ii)	
              Tax
                Gross-up Payment, as follows:

            


    

     

    
      	 	
              (A)
                

            	
              In
                the event that any payment made pursuant to Section 6(c) hereof or
                any
                insurance benefits, accelerated vesting, pro-rated bonus or other
                benefit
                payable to the Executive (under this Agreement or otherwise), (1)
                constitute “parachute payments” within the meaning of Section 280G (as it
                may be amended or replaced) of the Internal Revenue Code of 1986,
                as
                amended (the “Code”) (“Parachute Payments”) and (2) are subject to the
                excise tax imposed by Section 4999 (as it may be amended or replaced)
                of
                the Code (“the Excise Tax”), then Coda Octopus shall pay to the Executive
                an additional amount (the “Gross-Up Amount”) such that the net benefits
                retained by the Executive after the deduction of the Excise Tax (including
                interest and penalties) and any federal, or local income and employment
                taxes (including interest and penalties) upon the Gross-Up Amount
                shall be
                equal to the benefits that would have been delivered hereunder had
                the
                Excise Tax not been applicable and the Gross-Up Amount not been
                paid.

            


    

     

    
      	 	
              (B)
                

            	
              For
                purposes of determining the Gross-Up Amount: (1) Parachute Payments
                provided under arrangements with the Executive other than under any
                bonus
                or other incentive pay or stock plan or program of Coda Octopus
                (collectively, the “Plan”) and this Agreement, if any, shall be taken into
                account in determining the total amount of Parachute Payments received
                by
                the Executive so that the amount of excess Parachute Payments that
                are
                attributable to provisions of the Plan and Agreement is maximized;
                and (2)
                the Executive shall be deemed to pay federal, state and local income
                taxes
                at the highest marginal rate of taxation for the Executive’s taxable year
                in which the Parachute Payments are includable in the Executive’s income
                for purposes of federal, state and local income
                taxation.

            


    

     

    
      
        
        

      

      
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              (C)
                

            	
              The
                determination of whether the Excise Tax is payable, the amount thereof,
                and the amount of any Gross-Up Amount shall be made in writing in
                good
                faith by a nationally recognized independent certified public accounting
                firm selected by Coda Octopus and approved by the Executive, such
                approval
                not to be unreasonably withheld (the “Accounting Firm”). If such
                determination is not finally accepted by the Internal Revenue Service
                (or
                state or local revenue authorities) on audit, then appropriate adjustments
                shall be computed based upon the amount of Excise Tax and any interest
                or
                penalties so determined; provided, however, that the Executive in
                no event
                shall owe Coda Octopus any interest on any portion of the Gross-Up
                Amount
                that is returned to Coda Octopus. For purposes of making the calculations
                required by this Section 6(d)(v), to the extent not otherwise specified
                herein, reasonable assumptions and approximations may be made with
                respect
                to applicable taxes and reasonable, good faith interpretations of
                the Code
                may be relied upon. Coda Octopus and the Executive shall furnish
                such
                information and documents as may be reasonably requested in connection
                with the performance of the calculations under this Section 6(d)(v).
                Coda
                Octopus shall bear all costs incurred in connection with the performance
                of the calculations contemplated by this Section 6(d)(v). Coda Octopus
                shall pay the Gross-Up Amount to the Executive no later than 60 days
                following receipt of the Accounting Firm’s determination of the Gross-Up
                Amount.

            


    

     

    
      	 	
              (iii)
                

            	
              None
                of the benefits described in this Section 6(d) will be payable unless
                the
                Executive has signed a general release which has become irrevocable,
                satisfactory to Coda Octopus in the reasonable exercise of its discretion,
                releasing Coda Octopus, its affiliates including Coda Octopus, and
                their
                officers, directors and employees, from any and all claims or potential
                claims arising from or related to the Executive’s employment or
                termination of employment. 

            


    

     

    
      	 	
              (iv)
                

            	
              For
                the purposes of this Agreement, a “Change in Control” shall mean any of
                the following events:

            


    

     

    
      	 	
              (A)
                

            	
              The
                ownership or acquisition (whether by a merger contemplated by Section
                6(d)(vii)(B) below, or otherwise) by any Person (other than a Qualified
                Affiliate), in a single transaction or a series of related or unrelated
                transactions, of Beneficial Ownership of more than 50% of (1) Coda
                Octopus’s outstanding common stock (the “Common Stock”) or (2) the
                combined voting power of Coda Octopus’s outstanding securities entitled to
                vote generally in the election of directors (the “Outstanding Voting
                Securities”);

            


    

     

    
      	 	
              (B)
                

            	
              The
                merger or consolidation of Coda Octopus with or into any other Person
                other than a Qualified Affiliate, if, immediately following the
                effectiveness of such merger or consolidation, Persons who did not
                Beneficially Own Outstanding Voting Securities immediately before
                the
                effectiveness of such merger or consolidation directly or indirectly
                Beneficially Own more than 50% of the outstanding shares of voting
                stock
                of the surviving entity of such merger or consolidation (including
                for
                such purpose in both the numerator and denominator, shares of voting
                stock
                issuable upon the exercise of then outstanding rights (including
                conversion rights), options or warrants) (“Resulting Voting Securities”),
                provided that, for purposes of this Section 6(d)(vii)(B), if a Person
                who
                Beneficially Owned Outstanding Voting Securities immediately before
                the
                merger or consolidation Beneficially Owns a greater number of the
                Resulting Voting Securities immediately after the merger or consolidation
                than the number the Person received solely as a result of the merger
                or
                consolidation, such greater number will be treated as held by a Person
                who
                did not Beneficially Own Outstanding Voting Securities before the
                merger
                or consolidation, and provided further that such merger or consolidation
                would also constitute a Change in Control if it would satisfy the
                foregoing test if rights (including conversion rights), options and
                warrants were not included in the
                calculation;

            


    

     

    
      
        
        

      

      
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              (C)
                

            	
              Any
                one or a series of related sales or conveyances to any Person or
                Persons
                (including a liquidation or dissolution) other than any one or more
                Qualified Affiliates of all or substantially all of the assets of
                Coda
                Octopus;

            


    

     

    
      	 	
              (D)
                

            	
              Incumbent
                Directors cease, for any reason, to be a majority of the members
                of the
                Board of Directors, where an “Incumbent Director” is (1) an individual who
                is a member of the Board of Directors on the effective date of this
                Agreement or (2) any new director whose appointment by the Board
                of
                Directors or whose nomination for election by the stockholders was
                approved by a majority of the persons who were already Incumbent
                Directors
                at the time of such appointment, election or approval, other than
                any
                individual who assumes office initially as a result of an actual
                or
                threatened election contest with respect to the election or removal
                of
                directors or other actual or threatened solicitation of proxies or
                consents by or on behalf of a Person other than the Board of Directors
                or
                as a result of an agreement to avoid or settle such a contest or
                solicitation; or

            


    

     

    
      	
            	(E)	
              A
                Change in Control shall also be deemed to occur immediately before
                the
                completion of a tender offer for Coda Octopus’s securities representing
                more than 50% of the Outstanding Voting Securities, other than a
                tender
                offer by a Qualified Affiliate.  

            


    

     

    
      	 	
              (F)
                

            	
              For
                purposes of this Agreement, the following definitions shall apply:
                (a)
                “Beneficial Ownership,” “Beneficially Owned” and “Beneficially Owns” shall
                have the meanings provided in Exchange Act Rule 13d-3; (b) “Exchange Act”
                shall mean the Securities Exchange Act of 1934, as amended; (c) “Person”
                shall mean any individual, entity, or group (within the meaning of
                Section
                13(d)(3) or 14(d)(2) of the Exchange Act), including any natural
                person,
                corporation, trust, association, company, partnership, joint venture,
                limited liability company, legal entity of any kind, government,
                or
                political subdivision, agency or instrumentality of a government,
                as well
                as two or more Persons acting as a partnership, limited partnership,
                syndicate or other group for the purpose of acquiring, holding or
                disposing of Coda Octopus’s securities; and (d) “Qualified Affiliate”
                shall mean (i) any directly or indirectly wholly owned subsidiary
                of Coda
                Octopus; (ii) any employee benefit plan (or related trust) sponsored
                or
                maintained by Coda Octopus or by any entity controlled by Coda Octopus;
                or

            


    

     

    
      	 	
              (v)
                

            	
              any
                Person consisting in whole or in part of the Executive or one or
                more
                individuals who are then Coda Octopus’s Chief Executive Officer or any
                other named executive officer (as defined in Item 402 of Regulation
                S-K
                under the Securities Act of 1933) of Coda Octopus as indicated in
                its most
                recent securities filing made before the date of the
                transaction.

            


    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      	
              (e)
                

            	
              Termination
                In the Event of Death or Disability.

            


    

     

    
      	 	
              (i)
                

            	
              If
                the Executive’s employment terminates because of his death, any unvested
                portion of any stock option and any restricted stock previously issued
                to
                the Executive by Coda Octopus shall become fully vested as of the
                date of
                his death and the Executive’s estate or other legal representatives shall
                have 360 days from the Date of Termination or the remaining option
                term,
                if earlier, to exercise all stock options granted to the Executive.
                In
                addition, the Executive’s estate shall be entitled to receive a pro-rata
                share of any performance bonus to which he otherwise would have been
                entitled for the fiscal year in which his death occurs. For a period
                of
                one (1) year following the Date of Termination, Coda Octopus shall
                pay
                such health insurance premiums as may be necessary to allow Executive’s
                spouse and dependents to receive health insurance coverage substantially
                similar to coverage they received prior to the Date of Termination.
                In
                addition to the foregoing, any payments to which Executive’s spouse,
                beneficiaries, or estate may be entitled under any employee benefit
                plan
                shall also be paid in accordance with the terms of such plan or
                arrangement. Such payments, in the aggregate, shall fully discharge
                Coda
                Octopus’s obligations hereunder.

            


    

     

    
      	 	
              (ii)
                

            	
              In
                the event the Executive’s employment terminates due to his Disability, as
                defined in any long-term disability insurance policy or plan provided
                to
                him by Coda Octopus (“Disability Insurance”), he shall be entitled to
                receive his Base Salary until such date as he shall commence receiving
                disability benefits pursuant to any Disability Insurance. In addition,
                as
                of the effective date of the termination notice specified in Section
                5(d),
                the Executive shall vest in any unvested portion of any stock option
                and
                any restricted shares previously granted to him by Coda Octopus and
                the
                Executive shall have 360 days from the Date of Termination or the
                remaining option term, if earlier, to exercise all stock options
                granted
                to the Executive. The Executive also shall be entitled to receive
                a
                pro-rata share of any performance bonus to which he otherwise would
                have
                been entitled for the fiscal year in which his employment terminates
                due
                to his Disability. For a period of one year following the Date of
                Termination, Coda Octopus shall pay such health insurance premiums
                as may
                be necessary to allow Executive and Executive’s spouse and dependents to
                receive health insurance coverage substantially similar to coverage
                they
                received prior to the Date of Termination.


            


    

     

    
      	
              7.
                

            	
              Confidentiality

            


    

     

    
      	
              (a)
                

            	
              Definition
                of Proprietary Information.
                The Executive acknowledges that he may be furnished or may otherwise
                receive or have access to confidential information which relates
                to Coda
                Octopus’s past, present or future business activities, strategies,
                services or products, research and development, specifically all
                formulas,
                processes, computer code, customer lists, computer user identifiers
                and
                passwords, and all purchasing, engineering, accounting, marketing
                and
                other information, proprietary to Coda Octopus and not generally
                known,
                relating to research, development, manufacture, marketing and sale
                of Coda
                Octopus products, as well as formulas, computer code, processes and
                other
                information received by Coda Octopus from third parties under an
                obligation of secrecy.

            


    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      	 	
              All
                such information, including any materials or documents containing
                such
                information, shall be considered by Coda Octopus and the Executive
                as
                proprietary and confidential (the “Proprietary
                Information”).

            


    

     

    
      	
              (b)

            	
              Definition
                of Inventions.
                Invention(s) means all formulas, processes, discoveries, improvements,
                ideas and works of authorship, whether patentable or copyrightable
                or not,
                which the Executive learns, has access to, has a part in developing,
                first
                conceives or first reduces to practice, alone or with others (1)
                that are
                developed on Coda Octopus time, or (2) that relate directly to Coda
                Octopus’ business or actual or anticipated research, or (3) for which Coda
                Octopus’ Proprietary Information or other Coda Octopus property is sued,
                or (4) that result from any of the Executive’s work for Coda
                Octopus.

            


    

     

    
      	 	
              Executive's
                Obligation With Regard to Inventions.
                

            


    

     

    (A) All
      Inventions that the Executive may learn, have access to, have a part in
      developing, first conceive, or first reduce to practice (i) during employment
      with Coda Octopus, whether or not during normal work time or at Coda Octopus’
premises, or (ii) at any time after employment termination if based on
      Confidential Information, are and shall remain the sole property of Coda Octopus
      in all countries, and shall be promptly disclosed to and are hereby assigned
      to
      Coda Octopus without charge to Coda Octopus. In the absence of clear and
      convincing proof to the contrary, all formulas, processes, inventions, ideas,
      and works of authorship conceived by the Executive within one year after
      termination of employment with Coda Octopus that directly relate to Coda Octopus
      business or demonstrably anticipated research or development will be considered
      to be Inventions to be disclosed to and owned by Coda Octopus.

     

    (B) The
      Executive will acknowledge and deliver promptly without charge all documents
      to
      Coda Octopus, and to do such other acts as may be necessary in Coda Octopus’
opinion to obtain and maintain patents or copyrights and to vest the entire
      right and title in Coda Octopus to such patents, copyrights and Inventions
      in
      all countries including, if required by Coda Octopus but not limited to,
      completion and signing of the Assignment exhibited as Appendix B to this
      Agreement. Failure on the part of Coda Octopus at any time to require the
      Executive to sell, assign, transfer and set over the entire right, title and
      interest in and to said Inventions shall not be deemed to be a waiver of its
      rights thereto.

     

    (C) The
      obligations of this section shall not apply to any invention developed entirely
      on the Executive's own time without the use of any Coda Octopus equipment,
      supplies, facility or Proprietary Information and (i) which does not relate
      to
      Coda Octopus business, or to Coda Octopus’ actual or demonstrably anticipated
      research or development or (ii) which does not result from any work performed
      by
      the Executive for Coda Octopus.

     

    
      	
              (c)
                

            	
              Exclusions.
                Notwithstanding the foregoing, Proprietary Information shall not
                include
                information in the public domain not as a result of a breach of any
                duty
                by the Executive or any other
                person.

            


    

     

    
      	
              (d)
                

            	
              Obligations.
                Both during and after the Employment Period, the Executive will preserve
                and protect the confidentiality of the Proprietary Information and
                all
                physical forms thereof, whether disclosed to him before this Agreement
                and
                Inventions signed or afterward (except as required by applicable
                law or
                otherwise as necessary in connection with the performance of the
                Executive’s duties to Coda Octopus hereunder). In addition, the Executive
                shall not (i) disclose or disseminate the Proprietary Information
                to any
                third party, including employees of Coda Octopus (or their affiliates)
                without a legitimate business need to know; (ii) remove the Proprietary
                Information from Coda Octopus’s premises without a valid business purpose;
                or (iii) use the Proprietary Information for his own benefit or for
                the
                benefit of any third party.

            


    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    
      	
              (e)
                

            	
              Return
                of Proprietary Information.
                The Executive acknowledges that all the Proprietary Information and
                Inventions used or generated during the course of working for Coda
                Octopus
                is the property of Coda Octopus. The Executive will deliver to Coda
                Octopus all documents and other tangibles (including diskettes and
                other
                storage media) containing the Proprietary Information and Inventions
                at
                any time upon request by Coda Octopus during his employment and
                immediately upon termination of his employment. If requested by Coda
                Octopus, the Executive will enter into an Assignment of Intellectual
                Property.

            


    

     

    
      	
              8.
                

            	
              Noncompetition
                and Nonsolicitation

            


    

     

    
      	
              (a)
                

            	
              Restriction
                on Competition.
                Throughout the Employment Period and for a further period of twelve
                (12)
                months thereafter (the “Restricted Period”), provided, however, that the
                Restricted Period shall only extend for six months following the
                expiration or termination of the Executive’s employment if the Executive’s
                employment is terminated following a Change in Control, the Executive
                will
                not engage, directly or indirectly, as an owner, director, trustee,
                manager, member, employee, consultant, partner, principal, agent,
                representative, stockholder, or in any other individual, corporate
                or
                representative capacity, in any of the following: (i) any subsea
                visualization company, or (ii) any other business in which Coda Octopus
                is
                engaged or is actively planning to engage as of the date of the
                Executive’s termination of employment. Notwithstanding the foregoing, the
                Executive shall not be deemed to have violated this Section 8(a)
                solely by
                reason of his passive ownership of 1% or less of the outstanding
                stock of
                any publicly traded corporation or other
                entity.

            


    

     

    
      	
              (b)
                

            	
              Non-Solicitation
                of Clients.
                During the Restricted Period, the Executive will not solicit, directly
                or
                indirectly, on his own behalf or on behalf of any other person(s),
                any
                client of Coda Octopus whom Coda Octopus had provided services at
                any time
                during the Executive’s employment with Coda Octopus in any line of
                business that Coda Octopus conducts as of the date of the Executive’s
                termination of employment or that Coda Octopus is actively soliciting,
                for
                the purpose of marketing or providing any service competitive with
                any
                service then offered by Coda
                Octopus.

            


    

     

    
      	
              (c)
                

            	
              Non-Solicitation
                of Employees.
                During the Restricted Period, the Executive will not, directly or
                indirectly, hire or attempt to hire or cause any business, other
                than a
                Qualified Affiliate, to hire any person who is then or was at any
                time
                during the preceding six months an employee of Coda Octopus and who
                is at
                the time of such hire or attempted hire, or was at the date of such
                employee’s separation from Coda Octopus a vice president, senior vice
                president or executive vice president or other senior executive employee
                of Coda Octopus.

            


    

     

    
      	
              (d)
                

            	
              Acknowledgment.
                The Executive acknowledges that he will acquire much Proprietary
                Information concerning the past, present and future business of Coda
                Octopus as the result of his employment, as well as access to the
                relationships between Coda Octopus and Coda Octopus and their clients
                and
                employees. The Executive further acknowledges that the business of
                Coda
                Octopus is very competitive and that competition by him in that business
                during his employment, or after his employment terminates, would
                severely
                injure Coda Octopus. The Executive understands that the restrictions
                contained in this Section 8 are reasonable and are required for Coda
                Octopus’s legitimate protection, and do not unduly limit his ability to
                earn a livelihood.

            


    

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    
      	
              (e)
                

            	
              Rights
                and Remedies upon Breach.
                The Executive acknowledges that any breach by him of any of the provisions
                of Sections 7 and 8 (the “Restrictive Covenants”) would result in
                irreparable injury and damage for which money damages would not provide
                an
                adequate remedy. Therefore, if the Executive breaches, or threatens
                to
                commit a breach of, any of the provisions of the Restrictive Covenants,
                Coda Octopus shall have the following rights and remedies, each of
                which
                rights and remedies shall be independent of the other and severally
                enforceable, and all of which rights and remedies shall be in addition
                to,
                and not in lieu of, any other rights and remedies available to Coda
                Octopus under law or in equity (including, without limitation, the
                recovery of damages):

            


    

     

    
      	 	
              (i)
                

            	
              The
                right and remedy to have the Restrictive Covenants specifically enforced
                (without posting bond and without the need to prove damages) by any
                court
                of competent jurisdiction, including, without limitation, the right
                to an
                entry against the Executive of restraining orders and injunctions
                (preliminary, mandatory, temporary and permanent) against violations,
                threatened or actual, and whether or not then continuing, of such
                covenants; and

            


    

     

    
      	 	
              (ii)
                

            	
              The
                right and remedy to require the Executive to account for and pay
                over to
                Coda Octopus and its affiliates all compensation, profits, monies,
                accruals, increments or other benefits (collectively, “Benefits”) derived
                or received by him as the result of any transactions constituting
                a breach
                of the Restrictive Covenants, and the Executive shall account for
                and pay
                over such Benefits to Coda Octopus and, if applicable, its affected
                affiliates.

            


    

     

    
      	
              (f)
                

            	
              If
                any court or other decision-maker of competent jurisdiction determines
                that any of the Restrictive Covenants, or any part thereof, is
                unenforceable because of the duration or geographical scope of such
                provision, then, after such determination has become final and
                non-appealable, the duration or scope of such provision, as the case
                may
                be, shall be reduced so that such provision becomes enforceable and,
                in
                its reduced form, such provision shall then be enforceable and shall
                be
                enforced.

            


    

     

    
      	
              9.
                

            	
              Executive
                Representation

            


    

     

    
      	 	
              The
                Executive represents and warrants to Coda Octopus that he is not
                now under
                any obligation of a contractual or other nature to any person, business
                or
                other entity which is inconsistent or in conflict with this Agreement
                or
                which would prevent him from performing his obligations under this
                Agreement. 

            


    

     

    
      	
              10.
                

            	
              Enforcement
                and Indemnification

            


    

     

    
      	
              (a)
                

            	
              Coda
                Octopus, in its sole discretion, may bring an action in any court
                of
                competent jurisdiction to seek injunctive relief and such other relief
                as
                Coda Octopus shall elect to enforce the Restrictive Covenants. If
                the
                courts of any one or more of such jurisdictions hold the Restrictive
                Covenants wholly unenforceable by reason of breadth of scope or otherwise
                it is the intention of Coda Octopus and the Executive that such
                determination not bar or in any way affect Coda Octopus’s right, or the
                right of any of its affiliates, to the relief provided in Section
                8(e)
                above in the courts of any other jurisdiction within the geographical
                scope of such Restrictive Covenants, as to breaches of such Restrictive
                Covenants in such other respective jurisdictions, such Restrictive
                Covenants as they relate to each jurisdiction being, for this purpose,
                severable, diverse and independent covenants, subject, where appropriate,
                to the doctrine of res judicata. The parties hereby agree to waive
                right
                to a trial by jury for any and all disputes hereunder (whether or
                not
                relating to the Restrictive
                Covenants).

            


    

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    
      	
              (b)
                

            	
              In
                accordance with Appendix C to this Agreement, Coda Octopus will indemnify
                the Executive, to the maximum extent permitted by applicable law,
                against
                all costs, charges and expenses incurred or sustained by the Executive,
                including the cost of legal counsel selected and retained by the
                Executive
                in connection with any action, suit or proceeding to which the Executive
                may be made a party by reason of the Executive being or having been
                an
                officer, director, or employee of Coda Octopus or any subsidiary
                or
                affiliate of Coda Octopus. Coda Octopus will pay to the Executive
                in
                advance of the final disposition of any proceeding all such amounts
                incurred or suffered. 

            


    

     

    
      	
              11.
                

            	
              Miscellaneous

            


    

     

    
      	
              (a)
                

            	
              Litigation
                and Regulatory Cooperation.
                During and after Executive’s employment, Executive shall reasonably
                cooperate with Coda Octopus in the defense or prosecution of any
                claims or
                actions now in existence or which may be brought in the future against
                or
                on behalf of Coda Octopus which relate to events or occurrences that
                transpired while Executive was employed by Coda Octopus; provided,
                however, that such cooperation shall not materially and adversely
                affect
                Executive or expose Executive to an increased probability of civil
                or
                criminal litigation. Executive’s cooperation in connection with such
                claims or actions shall include, but not be limited to, being available
                to
                meet with counsel to prepare for discovery or trial and to act as
                a
                witness on behalf of Coda Octopus at mutually convenient times. During
                and
                after Executive’s employment, Executive also shall cooperate fully with
                Coda Octopus in connection with any investigation or review of any
                federal, state or local regulatory authority as any such investigation
                or
                review relates to events or occurrences that transpired while Executive
                was employed by Coda Octopus. Coda Octopus shall also provide Executive
                with compensation on an hourly basis (to be derived from the sum
                of his
                Base Salary and average annual incentive compensation) for requested
                litigation and regulatory cooperation that occurs after his termination
                of
                employment, and reimburse Executive for all costs and expenses incurred
                in
                connection with his performance under this Section 11(a), including,
                but
                not limited to, reasonable attorneys’ fees and
                costs.

            


    

     

    
      	
              (b)
                

            	
              Notices.
                All notices required or permitted under this Agreement shall be in
                writing
                and shall be deemed effective (i) upon personal delivery, (ii) upon
                deposit with the United States Postal Service, by registered or certified
                mail, postage prepaid, or (iii) in the case of facsimile transmission
                or
                delivery by nationally recognized overnight delivery service, when
                received, addressed as follows:

            


    

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    
      	
              (i)
                

            	
              If
                to Coda Octopus, to:

            


    

    


    Coda
      Octopus Group, Inc. 

    245
      Park Avenue 

    New
      York, New York 10167

     

    
      	
              (ii)
                

            	
              If
                to the Executive, to:

            


    

     

    19
      Spring Gardens

    Edinburgh

    EH8
      8KU

    


    or
      to
      such other address or addresses as either party shall designate to the other
      in
      writing from time to time by like notice.

     

    
      	
              (c)
                

            	
              Pronouns.
                Whenever the context may require, any pronouns used in this Agreement
                shall include the corresponding masculine, feminine or neuter forms,
                and
                the singular forms of nouns and pronouns shall include the plural,
                and
                vice versa.

            


    

     

    
      	
              (d)
                

            	
              Entire
                Agreement.
                This Agreement constitutes the entire agreement between the parties
                and
                supersedes all prior agreements and understandings, whether written
                or
                oral, relating to the subject matter of this
                Agreement.

            


    

     

    
      	
              (e)
                

            	
              Amendment.
                This Agreement may be amended or modified only by a written instrument
                executed by both Coda Octopus and the
                Executive.

            


    

     

    
      	
              (f)
                

            	
              Governing
                Law.
                This Agreement shall be construed, interpreted and enforced in accordance
                with the laws of the State of New York, without regard to its conflicts
                of
                laws principles.

            


    

     

    
      	
              (g)
                

            	
              Successors
                and Assigns.
                This Agreement shall be binding upon and inure to the benefit of
                both
                parties and their respective successors and assigns, including any
                entity
                with which or into which Coda Octopus may be merged or which may
                succeed
                to its assets or business or any entity to which Coda Octopus may
                assign
                its rights and obligations under this Agreement; provided, however,
                that
                the obligations of the Executive are personal and shall not be assigned
                or
                delegated by him.

            


    

     

    
      	
              (h)
                

            	
              Waiver.
                No delays or omission by Coda Octopus or the Executive in exercising
                any
                right under this Agreement shall operate as a waiver of that or any
                other
                right. A waiver or consent given by Coda Octopus or the Executive
                on any
                one occasion shall be effective only in that instance and shall not
                be
                construed as a bar or waiver of any right on any other
                occasion.

            


    

     

    
      	
              (i)
                

            	
              Captions.
                The captions appearing in this Agreement are for convenience of reference
                only and in no way define, limit or affect the scope or substance
                of any
                section of this Agreement.

            


    

     

    
      	
              (j)
                

            	
              Severability.
                In case any provision of this Agreement shall be held by a court
                or
                arbitrator with jurisdiction over the parties to this Agreement to
                be
                invalid, illegal or otherwise unenforceable, such provision shall
                be
                restated to reflect as nearly as possible the original intentions
                of the
                parties in accordance with applicable law, and the validity, legality
                and
                enforceability of the remaining provisions shall in no way be affected
                or
                impaired thereby.

            


    

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    
      	
              (k)
                

            	
              Counterparts.
                This Agreement may be executed in two or more counterparts, each
                of which
                shall be deemed an original but all of which together shall constitute
                one
                and the same instrument.

            


    

     

    IN
      WITNESS WHEREOF,
      the
      Parties have executed this Agreement as of the day and year first above
      written.

    


    CODA
      OCTOPUS GROUP, INC.

     

    By:
      

    Name:
      Jason Reid

    Title:
      President and Chief Executive Officer

    


    


    EXECUTIVE

     

    


    


    Name:
      Anthony Davis

    


    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    


    APPENDIX
      A

    


    


    TO
      BE
      INSERTED SEPARATELY

    


    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    


    APPENDIX
      B

     

    ASSIGNMENT

    


     

    WHEREAS,
      __________________________________________,
      hereinafter called "Assignor", residing at
      ________________________________________________________, has certain new and
      useful formulas, processes, discoveries, improvements, ideas and works of
      authorship (“Inventions”) disclosed in an application for United States and
      other Letters Patent
      entitled__________________________________________________________________________________________,
      and executed by __________________________________________________ on date
      herewith;

     

    AND
      WHEREAS
      Coda
      Octopus Group, Inc., located at 245 Park Avenue, New York, New York and or
      a
      subsidiary thereof, together with any successors, legal representatives or
      assigns thereof, called "Assignee" wants to acquire the entire right, title
      and
      interest in and to said Inventions and application.

     

    NOW,
      THEREFORE,
      in
      consideration of the entering into an Employment Contract with Assignee dated
      _____________, 2005 and other good and valuable consideration, the receipt
      of
      which is hereby acknowledged, the Assignor has sold, assigned, transferred
      and
      set over, and does hereby sell, assign, transfer and set over to Assignee the
      entire right, title and interest in and to said Inventions, and said application
      and all divisions and continuations thereof, and all United States Letters
      Patents which may be granted thereon and all reissues, reexaminations and
      extensions thereof, and all priority rights under all available International
      Agreements, Treaties and Conventions for the protection of Intellectual property
      in its various forms in every participating country, and all applications for
      patents (including related rights such as utility-model registrations,
      inventor's certificates, and the like) heretofore or hereafter filed for said
      Inventions in any foreign countries, and all patents (including all
      continuations, divisions, extensions, renewals, substitutes, and reissues
      thereof) granted for said Inventions in any foreign countries; and the Assignor
      hereby authorizes and requests the United States Commissioner of Patents and
      Trademarks, and any officials of foreign countries whose duty it is to issue
      patents on applications as aforesaid, to Issue all patents for said Inventions
      to Assignee in accordance with the terms of this Assignment;

     

    AND
      THE
      ASSIGNOR HEREBY
      covenants that he has full right to convey the entire Interest herein assigned,
      and that he has not executed, and will not execute, any agreement in conflict
      herewith;

     

    AND
      THE
      ASSIGNOR HEREBY
      further
      covenants and agrees that he will communicate to Assignee any facts known to
      him
      respecting said Inventions, and testify in any legal proceeding, sign all lawful
      papers, execute all divisional, continuation, substitute and reissue
      applications, make all rightful oaths and generally do everything possible
      to
      aid Assignee to obtain and enforce proper patent protection for said Inventions
      in all countries.

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

     

    In
      testimony whereof, I hereunto set my hand this ____ day of _______________
      20____

     

    


     

    SIGNATURE
      OF ASSIGNOR

     

    


     

    STATE
      OF
      ________________________________________

     

    COUNTY
      OF
      ______________________________________

     

    On
      _____________________ before me _________________________ Notary Public,
      personally appeared _______________________________ personally known to me
      (or
      proved to me on the basis of satisfactory evidence) to be the person whose
      name
      is subscribed to the within instrument and acknowledged to me that he executed
      the same in his authorized capacity, and that by his signature on the instrument
      the person, or the entity upon behalf of which the person acted, executed the
      Instrument.

     

    


     

    WITNESS
      my hand and official seal.

    


     

    _______________________________

    


     

    Signature
      of Notary

     

    


     

    If
      UK or Norway, a different notarial acknowledgment will be
      required.

     

    


    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    APPENDIX
      C


     

    INDEMNITY
      AGREEMENT

     

    This
      Agreement is made as of the 1st
      day of
      July 2005, by and between CODA OCTOPUS GROUP, INC., a Delaware corporation
      (the
“Corporation”), and Anthony Davis (the “Indemnitee”), a Director and/or Officer
      of the Corporation (collectively the "Parties").

     

    WHEREAS,
      it is
      essential to the Corporation to retain and attract as Directors and Officers
      the
      most capable persons available, and

     

    WHEREAS,
      the
      substantial increase in corporate litigation subjects Directors and Officers
      to
      expensive litigation risks at the same time that the availability of Directors’
and Officers’ liability insurance has been severely limited, and

     

    WHEREAS,
      it is
      now and has always been the express policy of the Corporation to indemnify
      its
      Directors and Officers so as to provide them with the maximum possible
      protection permitted by law, and

     

    WHEREAS,
      the
      Corporation does not regard the protection available to Indemnitee as adequate
      in the present circumstances, and realizes that Indemnitee may not be willing
      to
      serve as a Director and/or Officer without adequate protection, and the
      Corporation desires Indemnitee to serve in such capacity;

     

    NOW,
      THEREFORE,
      in
      consideration of Indemnitee’s service as a Director and/or Officer after the
      date hereof, the Parties agree as follows:

     

    
      	
              1.

            	
              Definitions.
                As used in this Agreement:

            


    

     

    
      	 	
              (a)
                

            	
              The
                term “Proceeding” shall include any threatened, pending or completed
                action, suit or proceeding, whether brought by or in the right of
                the
                Corporation or otherwise and whether of a civil, criminal, administrative
                or investigative nature.

            


    

     

    
      	 	
              (b)
                

            	
              The
                term “Expenses” shall include, but is not limited to, expenses of
                investigations, judicial or administrative proceedings or appeals,
                damages, judgments, fines, amounts paid in settlement by or on behalf
                of
                Indemnitee, attorneys’ fees and disbursements and any expenses of
                establishing a right to indemnification under this
                Agreement.

            


    

     

    
      	 	
              (c)
                

            	
              The
                terms “Director” and “Officer” shall include Indemnitee’s service at the
                request of the Corporation as a director, officer, employee or agent
                of
                another corporation, partnership, joint venture, trust or other enterprise
                as well as a Director and/or Officer of the Corporation.
                

            


    

     

    
      	
              2.

            	
              Indemnity
                of Director or Officer.
                Subject only to the limitations set forth in Section 3, Corporation
                will
                pay on behalf of the Indemnitee all Expenses actually and reasonably
                incurred by Indemnitee because of any claim or claims made against
                him in
                a Proceeding by reason of the fact that he is or was a Director and/or
                Officer.

            


    

     

    
      	
              3.

            	
              Limitations
                on Indemnity.
                Corporation shall not be obligated under this Agreement to make any
                payment of Expenses to the
                Indemnitee,

            


    

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    
      	
            	(a)	
              which
                payment it is prohibited by applicable law from paying as
                indemnity;

            


    

     

    
      	 	
              (b)
                

            	
              for
                which payment is actually made to the Indemnitee under an insurance
                policy, except in respect of any excess beyond the amount of payment
                under
                such insurance;

            


    

     

    
      	 	
              (c)
                

            	
              for
                which payment the Indemnitee is indemnified by Corporation otherwise
                than
                pursuant to this Agreement;

            


    

     

    
      	 	
              (d)
                

            	
              resulting
                from a claim decided in a Proceeding adversely to the Indemnitee
                based
                upon or attributable to the Indemnitee gaining in fact any personal
                profit
                or advantage to which he was not legally
                entitled;

            


    

     

    
      	 	
              (e)

            	
              resulting
                from a claim decided in a Proceeding adversely to the Indemnitee
                for an
                accounting of profits made from the purchase or sale by the Indemnitee
                of
                securities of Corporation within the meaning of Section 16(b) of
                the
                Securities Exchange Act of 1934 and amendments thereto or similar
                provisions of any state statutory law or common law;
                or

            


    

     

    
      	 	
              (f)

            	
              brought
                about or contributed to by the dishonesty of the Indemnitee seeking
                payment hereunder; however, notwithstanding the foregoing, the Indemnitee
                shall be indemnified under this Agreement as to any claims upon which
                suit
                may be brought against him by reason of any alleged dishonesty on
                his
                part, unless it shall be decided in a Proceeding that he committed
                (i)
                acts of active and deliberate dishonesty, (ii) with actual dishonest
                purpose and intent, and (iii) which acts were material to the cause
                of
                action so adjudicated.

            


    

     

    
      	 	
              For
                purposes of Sections 3 and 4, the phrase “decided in a Proceeding” shall
                mean a decision by a court, arbitrator(s), hearing officer or other
                judicial agent having the requisite legal authority to make such
                a
                decision, which decision has become final and from which no appeal
                or
                other review proceeding is
                permissible.

            


    

     

    
      	
              4.
                

            	
              Advance
                Payment of Costs.
                Expenses incurred by Indemnitee in defending a claim against him
                in a
                Proceeding shall be paid by the Corporation as incurred and in advance
                of
                the final disposition of such Proceeding; provided, however, that
                Expenses
                of defense need not be paid as incurred and in advance where the
                judicial
                agent of first impression has decided the Indemnitee is not entitled
                to be
                indemnified pursuant to this Agreement or otherwise. Indemnitee hereby
                agrees and undertakes to repay such amounts advanced if it shall
                be
                decided in a Proceeding that he is not entitled to be indemnified
                by the
                Corporation pursuant to this Agreement or
                otherwise.

            


    

     

    
      	
              5.

            	
              Enforcement.
                If a claim under this Agreement is not paid by Corporation, or on
                its
                behalf, within thirty days after a written claim has been received
                by
                Corporation, the Indemnitee may at any time thereafter bring suit
                against
                Corporation to recover the unpaid amount of the claim and if successful
                in
                whole or in part, the Indemnitee shall also be entitled to be paid
                the
                Expenses of prosecuting such claim.

            


    

     

    
      	
              6.

            	
              Subrogation.
                In the event of payment under this Agreement, Corporation shall be
                subrogated to the extent of such payment to all of the rights of
                recovery
                of the Indemnitee, who shall execute all papers required and shall
                do
                everything that may be necessary to secure such rights, including
                the
                execution of such documents necessary to enable Corporation effectively
                to
                bring suit to enforce such rights.

            


    

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    
      	
              7.

            	
              Notice.
                The Indemnitee, as a condition precedent to his right to be indemnified
                under this Agreement, shall give to Corporation notice in writing
                as soon
                as practicable of any claim made against him for which indemnity
                will or
                could be sought under this Agreement. Notice to Corporation shall
                be given
                at its principal office and shall be directed to the Corporate Secretary
                (or such other address as Corporation shall designate in writing
                to the
                Indemnitee); notice shall be deemed received if sent by prepaid mail
                properly addressed, the date of such notice being the date postmarked.
                In
                addition, the Indemnitee shall give Corporation such information
                and
                cooperation as it may reasonably
                require.

            


    

     

    
      	
              8.

            	
              Saving
                Clause.
                If this Agreement or any portion thereof shall be invalidated on
                any
                ground by any court of competent jurisdiction, the Corporation shall
                nevertheless indemnify Indemnitee to the full extent permitted by
                any
                applicable portion of this Agreement that shall not have been invalidated
                or by any other applicable law.

            


    

     

    
      	
              9.

            	
              Indemnification
                Hereunder Not Exclusive.
                Nothing herein shall be deemed to diminish or otherwise restrict
                the
                Indemnitee’s right to indemnification under any provision of the
                Certificate of Incorporation or Bylaws of the Corporation or under
                Delaware law.

            


    

     

    
      	
              10.

            	
              Applicable
                Law.
                This Agreement shall be governed by and construed in accordance with
                internal laws of the State of
                Delaware.

            


    

     

    
      	
              11.

            	
              Counterparts.
                This Agreement may be executed in any number of counterparts, each
                of
                which shall constitute the
                original.

            


    

     

    
      	
              12.

            	
              Successors
                and Assigns.
                This Agreement shall be binding upon the Corporation and its successors
                and assigns.

            


    

     

    
      	
              13.

            	
              Continuation
                of Indemnification.
                The indemnification under this Agreement shall continue as to Indemnitee
                even though he may have ceased to be a Director and/or Officer and
                shall
                inure to the benefit of the heirs and personal representatives of
                Indemnitee.

            


    

     

    
      	
              14.

            	
              Coverage
                of Indemnification.
                The indemnification under this Agreement shall cover Indemnitee’s service
                as a Director and/or Officer prior to or after the date of the
                Agreement.

            


    

     

    IN
      WITNESS WHEREOF,
      the
      Parties have caused this Agreement to be duly executed and signed as of the
      day
      and year first above written.

     

     

    
      
        	CODA OCTOPUS GROUP, INC.	INDEMNITEE
	 	 
	By: 	 
	
                Name:
                  Jason Reid  

                Position:
                  President and CEO

              	Name: Anthony
                Davis


      

    

      

    
      
        
        

      

      
        21