Document:

a5830850ex10_2.htm

    EXHIBIT
10.2

    

    

    ANDREA
ELECTRONICS CORPORATION

     

    AMENDED
AND RESTATED

     

    CHANGE
IN CONTROL AGREEMENT

    

    The Board
of Directors (the “Board”) of Andrea Electronics Corporation (the “Company”), a
New York corporation, desires to assure the Company of the continued services of
Corisa L. Guiffre (the “Employee”) for the benefit of the Company, particularly
in the face of a take over attempt.

    

    This
Change in Control agreement (“Agreement”) therefore sets forth those benefits
which the Company will provide to Employee in the event Employee’s employment
with the Company is terminated after a “Change in Control of the Company” (as
defined in paragraph 2) under the circumstances described below.

    

    
      	
              1)  

            	
              TERM

            

    

    

    If a
Change in Control of the Company should occur while Employee is still an
employee of the Company, then this Agreement shall continue in effect from the
date of such Change in Control of the Company for so long as Employee remains an
employee of the Company, but in no event for more than three full calendar years
following a Change in Control of the Company; provided, however, that the
expiration of the term of this Agreement shall not adversely affect Employee’s
rights under this Agreement which have accrued prior to such
expiration.  If no Change in Control of the Company occurs before
Employee’s status as an employee of the Company is terminated, this Agreement
shall expire on such date.

    

    
      	
              2)  

            	
              CHANGE
      IN CONTROL

            

    

     

    
      	
              a)  

            	
              For
      purposes hereof, a “change in control” shall be defined
  as:

            

    

     

    
      	
              i)  

            	
              The
      acquisition by any individual, entity or group (within the meaning of
      Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
      amended (the “Exchange Act”)) (a “Person”) of beneficial ownership (within
      the meaning of Rule 13D-3 promulgated under the Exchange Act) of 20% or
      more of either (A) the then outstanding shares of common stock of the
      Company (the “Outstanding Company Common Stock”) or (B) the combined
      voting power of the then outstanding voting securities of the Company
      entitled to vote generally in the election of Directors (the “Outstanding
      Company Voting Securities”); provided, however, that for purposes of this
      subsection (I), the following acquisitions shall not constitute a Change
      of Control:  (i) any acquisition directly from the Company, (ii)
      any acquisition by the Company, (iii) any acquisition by any employee
      benefit plan (or related trust) sponsored or maintained by the Company or
      any corporation controlled by the Company or (iv) any acquisition by any
      corporation pursuant to a transaction which complies with clauses (A), (B)
      and (C) of subsection (iii) below:
or

            

    

     

    
      	
              ii)  

            	
              Individuals
      who, as of the date hereof, constitute the Committee (the “Incumbent
      Board”) cease for any reason to constitute at least a majority of the
      Committee, provided, however, that any individual becoming a director
      subsequent to the date hereof whose election or nomination for election by
      the Company’s shareholders, was approved by a vote of at least a majority
      of the directors then comprising the Incumbent Board shall be considered
      as though such individual were a member of the Incumbent Board, but
      excluding, for this purpose, any such individual whose initial assumption
      of office occurs 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 Committee; or

            

    

     

    
      	
              iii)  

            	
              Consummation
      of a reorganization, merger, consolidation or sale or other disposition of
      all or substantially all of the assets of the Company (a “Business
      Combination”), in each case, unless, following such Business Combination,
      (A) all or substantially all of the individuals and entities who were the
      beneficial owners, respectively, of the Outstanding Company Common Stock
      and Outstanding Company Voting Securities immediately prior to
      such  Business Combination beneficially own, directly or
      indirectly, more than 60% or, respectively, the then outstanding shares of
      common stock and the combined voting power of the then outstanding voting
      securities entitled to vote generally in the election of directors, as the
      case may be, of the corporation resulting from such Business Combination
      (including, without limitation, a corporation which as a result of such
      transaction owns the Company or all or substantially all of the Company’s
      assets either directly or through one or more subsidiaries) in
      substantially the same proportions as their ownership, immediately prior
      to such Business Combination of the Outstanding Company Common Stock and
      Outstanding Company Voting Securities, as the case may be, (B) no Person
      (excluding any employee benefit plan (or related trust) of the Company or
      such corporation resulting from such Business Combination) beneficially
      owns, directly or indirectly, 20% or more of, respectively, the then
      outstanding shares of common stock of the corporation resulting from such
      Business Combination or the combined voting power of the then outstanding
      voting securities of such corporation except to the extent that such
      ownership existed prior to the Business Combination and (C) at least a
      majority of the members of the board of directors of the corporation
      resulting from such Business Combination were members of the incumbent
      Board at the time of the execution of the initial agreement, or of the
      action of the Committee, providing for such Business Combination;
      or

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	
              iv)  

            	
              Approval
      by the shareholders of the Company of a complete liquidation or
      dissolution of the Company.

            

    

     

    
      	
              b)  

            	
              For
      purposes hereof, “Termination” shall be defined as: involuntary
      termination or a “voluntary” termination following an event of “Good
      Reason.”  For the purposes of the this Agreement “Good Reason”
      shall mean the occurrence of any of the following events without the
      Employee’s consent::

            

    

     

    
      	
              i)  

            	
              The
      assignment to Employee of duties that constitute a material diminution of
      her authority, duties, or responsibilities (including reporting
      requirements);

            

    

     

    
      	
              ii)  

            	
              A
      material diminution in Employee’s base
salary;

            

    

     

    
      	
              iii)  

            	
              Relocation
      of Employee to a location outside a radius of 15 miles of the Company’s
      main office; or

            

    

     

    
      	
              iv)  

            	
              Any
      other action or inaction by the Company that constitutes a material breach
      of this Agreement;

            

    

     

    provided,
that within ninety (90) days after the initial existence of such event, the
Company shall be given notice and a opportunity, not less than thirty (30) days,
to effectuate a cure for such asserted “Good Reason” by
Employee.  Employee’s resignation hereunder for Good Reason shall not
occur later than one hundred fifty (150) days following the initial date of
which the event Employee claims constitutes Good Reason occurred.

     

    
      	
              c)  

            	
              Upon
      the occurrence of a Change in Control followed by the Employee’s
      Termination of employment, the Company shall pay Employee, or in the event
      of her subsequent death, her beneficiary or beneficiaries, or her estate,
      as the case may be, a sum equal to three (3) times Employee’s average
      annual compensation for the five (5) preceding taxable
      years.  Such annual compensation shall include bonuses, pension
      and profit sharing plan benefits, severance payments, retirement benefits
      and fringe benefits paid or to be paid to the Employee during such
      years.  Such annual compensation shall not include any
      commissions.  Payments will be made, at the Company’s election,
      in a lump sum or paid in equal thirty (30) monthly installments following
      the Employee’s Termination.

            

    

     

    
      	
              d)  

            	
              All
      restrictions on the restricted stock will lapse immediately, incentive
      stock options and stock appreciation rights will become immediately
      exercisable, and Performance Shares/Units will vest immediately, in full,
      in the event of a Change in
Control.

            

    

     

    
      	
              e)  

            	
              Upon
      the occurrence of a Change in Control, Employee will be entitled to
      receive benefits due her under or contributed by the Company on her behalf
      pursuant to any retirement, incentive, profit sharing, bonus, performance,
      disability or other employee benefit plan maintained by the Company on
      Employee’s behalf to the extent such benefits are not otherwise paid to
      Employee under a separate provision of this
  Agreement.

            

    

     

    
      	
              f)  

            	
              Upon
      the occurrence of a Change in Control followed by the Employee’s
      Termination of employment, the Company will cause to be continued life,
      medical, dental and disability coverage substantially identical to the
      coverage maintained by the Company for Employee prior to her severance,
      except to the extent that such coverage may be changed in its application
      for all Company employees on a nondiscriminatory basis.  Such
      coverage and payments shall cease upon the expiration of thirty-six (36)
      full calendar months following the date of
  Termination.

            

    

     

    
      	
              g)  

            	
              Any
      and all payments to be made to the Employee under this Agreement or
      otherwise as a result of a Change in Control (hereinafter referred to as
      “Change in Control Payments”), shall be made free and clear of, and
      without deduction or withholding for or on account of, any tax which may
      be payable under Section 4999 of the Code, now or hereafter imposed,
      levied, withheld or assessed (such amounts being hereinafter referred to
      as the “Excise Taxes”).  If, notwithstanding the foregoing
      provision, any Excise Taxes are withheld from any Change in Control
      Payments made or to be made to Employee, the amounts so payable to the
      Employee shall be increased to the extent necessary to yield to the
      Employee (after payment of any tax which may be payable under Section 4999
      of the Code) the full amount which he is entitled to receive pursuant to
      the terms of this Agreement or otherwise without regard to liability for
      any Excise Taxes and any other Federal, State, FICA/Medicare and
      unemployment taxes thereon.  In the event any Excise Taxes are
      now or hereafter imposed, levied, assessed, paid or collected with respect
      to the Change of Control Payments made or to be made to the Employee,
      Excise Taxes and any other Federal, State and unemployment taxes thereon
      shall be paid by the Company or, if paid by the Employee, shall be
      reimbursed to the Employee by the Company upon its receipt of satisfactory
      evidence of such payment having been
made.

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	
              h)  

            	
              Section
      409A of the Code.

            

    

     

    
      	
              i)  

            	
              This
      Agreement is intended to comply with the requirements of Section 409A of
      the Internal Revenue Code (the “Code”), and specifically, with the
      “short-term deferral exception” under Treasury Regulation Section
      1.409A-1(b)(4) and the “separation pay exception:” under Treasury
      Regulation Section 1.409(A)-1(b)(9)(iii), and shall in all respects be
      administered in accordance with Section 409A of the Code.  If
      any payment or benefit hereunder cannot be provided or made at the time
      specified herein without incurring sanctions on Employee under Section
      409A of the Code, then such payment or benefit shall be provided in full
      at the earliest time thereafter when such sanctions will not be
      imposed.  For purposes of Section 409A of the Code, all payments
      to be made upon termination of employment under this Agreement may only be
      made upon a “separation from service” (within the meaning of such term
      under Section 409A of the Code), each payment made under this Agreement
      shall be treated as a separate payment, the right to a series of
      installment payments under this Agreement (if any) is to be treated as a
      right to a series of separate payments, and if a payment is not made by
      the designated payment date under this Agreement, the payment shall be
      made by December 31 of the calendar year in which the designated date
      occurs.  To the extent that any payment provided for hereunder
      would be subject to additional tax under Section 409A of the Code, or
      would cause the administration of this Agreement to fail to satisfy the
      requirements of Section 409A of the Code, such provision shall be deemed
      null and void to the extent permitted by applicable law, and any such
      amount shall be payable in accordance with (ii) below.  In no
      event shall Employee, directly or indirectly, designate the calendar year
      of payment.

            

    

     

    
      	
              ii)  

            	
              If
      when separation from service occurs Employee is a “specified employee”
      within the meaning of Section 409A of the Code and if the cash severance
      payment under this Agreement would be considered deferred compensation
      under Section 409A of the Code, and, finally, if an exemption from the
      6-month delay requirement of Section 409A(a)(2)(B)(i) of the Code is not
      available, the Company will make the severance payment under the Agreement
      to Employee in a single lump sum without interest of the first payroll
      date that occurs after the date that is six (6) months after the date on
      which Employee separate from
service.

            

    

     

    
      	
              iii)  

            	
              If
      (x) under the terms of the applicable policy or policies for the insurance
      or other benefits specified in this Agreement it is not possible to
      continue coverage for Employee and her dependents, or (y) when a
      separation from service occurs Employee is a “specified employee” within
      the meaning of Section 409A of the Code, and if any of the continued
      insurance coverage or other benefits specified in this Agreement would be
      considered deferred compensation under Section 409A of the Code, and,
      finally, if an exemption from the six-month delay requirement of Section
      409A(a)(2)(B)(i) of the Code is not available for that particular
      insurance or other benefit, the Company shall pay to Employee in a single
      lump sum an amount in cash equal to the present value of the Company’s
      projected cost to maintain that particular insurance benefit (and
      associated income tax gross-up benefit, if applicable) had Employee’s
      employment not terminated, assuming continued coverage for 36
      months.  The lump-sum payment shall be made thirty (30) days
      after employment termination or, if provision (ii) of this section
      applies, on the first payroll date that occurs after the date that is six
      (6) months after the date on which Employee separates from
      service.

            

    

     

    
      	
              iv)  

            	
              Reference
      in this Agreement to Section 409A of the Code include rules, regulations,
      and guidance of general application issued by the Department of the
      Treasury under Internal Revenue Section 409A.Any payments are to intended
      to comply with Section 409A of the Code.  Section 409A of the
      Code....

            

    

    

    SIGNATURES

    

    IN WITNESS WHEREOF, Andrea Electronics
Corporation has caused this Agreement to be executed and its seal to be affixed
hereunto by its duly authorized officer and its directors, and Employee has
signed this Agreement, on the 11th day of
November, 2008.

    

    

    ANDREA
ELECTRONICS CORPORATION

    By:    /s/ Jonathan
Spaet_________________________

    Jonathan
Spaet

    Chairman
of the Compensation Committee of the Board of Directors, Andrea Electronics
Corporation

    

    EMPLOYEE

    /s/ Corisa L.
Guiffre________________________

    Corisa L.
Guiffre

    Vice
President, Chief Financial Officer and Assistant Corporate
Secretarya5831953ex10_6.htm

    EXHIBIT
10.6

     

     

    

    

    NONE
OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY U.S. STATE
SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE OFFERED OR SOLD, DIRECTLY
OR INDIRECTLY, IN THE UNITED STATES OR TO U.S. PERSONS, EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE
STATE SECURITIES LAWS.

     

    

    
      	 
	 
	
              WARRANT
      CERTIFICATE

            
	 

    

     

    WARRANT
FOR PURCHASE OF COMMON SHARES

    
       

      
        

        

      

    

    THIS
WARRANT WILL BE VOID AND OF NO VALUE UNLESS EXERCISED WITHIN THE LIMITS HEREIN
PROVIDED

     

    THIS
WARRANT IS NOT TRANSFERABLE

     

    BRAINTECH,
INC.

    (Incorporated
under the laws of Nevada)

     

    50,000
WARRANTS

     

    DATED:  September
26, 2008

     

    THIS IS TO
CERTIFY THAT ____________
is entitled to acquire in the manner herein provided, subject to the
restrictions herein contained, during the period commencing on the date hereof
and ending at 5:00 p.m. (Vancouver time) on September 26, 2011 (the "Expiry
Date"), the number of fully paid and non-assessable common shares ("Common
Shares") of Braintech, Inc. ("the Company") as set forth above at a price of USD
$0.36 per Common Share (the "Exercise Price").

     

    Until such
time as the same is no longer required under applicable securities laws and
regulations, the certificates representing any of the Common Shares issued upon
exercise of the Warrants represented by this Certificate will bear a legend in
substantially the following form:

     

    NONE
OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY U.S. STATE
SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE OFFERED OR SOLD, DIRECTLY
OR INDIRECTLY, IN THE UNITED STATES OR TO U.S. PERSONS, EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE
STATE SECURITIES LAWS.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    The
Warrants are governed by the following Terms and Conditions:

     

    ARTICLE
1

    INTERPRETATION

     

    1.1                          
Definitions

     

    In these Terms and Conditions, unless
there is something in the subject matter or context inconsistent
therewith:

     

    
      	
               
      

            	
              (a)

            	
              "Common
      Shares" means the common shares in the capital of the Company as
      constituted at the date hereof and any shares resulting from any
      subdivision or consolidation of the Common
  Shares;

            

    

     

    
      	
               
      

            	
              (b)

            	
              "Company"
      means Braintech, Inc. or its successor corporation as a result of
      consolidation, amalgamation or merger with or into any other corporation
      or corporations, or as a result of the conveyance or transfer of all or
      substantially all of the properties and estates of the Company as an
      entirety to any other corporation and thereafter "Company" will mean such
      successor corporation;

            

    

     

    
      	
               
      

            	
              (c)

            	
              "Company's
      Auditor" means an independent firm of accountants duly appointed as the
      auditor of the Company;

            

    

     

    
      	
               
      

            	
              (d)

            	
              "herein",
      "hereby" and similar expressions refer to these Terms and Conditions as
      the same may be amended or modified from time to time; and the expression
      "Article" and "Section" followed by a number refer to the specified
      Article or Section of these Terms and
  Conditions;

            

    

     

    
      	
               
      

            	
              (e)

            	
              "person"
      means an individual, corporation, partnership, trustee or any
      unincorporated organization and words importing persons have a similar
      meaning;

            

    

     

    
      	
               
      

            	
              (f)

            	
              "Warrant
      Holder" or "Holder" means the holder of the Warrants;
  and

            

    

     

    
      	
               
      

            	
              (g)

            	
              "Warrants"
      mean the share purchase warrants issued by the
  Company.

            

    

     

    1.2                          
Gender

     

    Words importing the singular number
include the plural and vice versa and words importing the masculine gender
include the feminine and neuter genders.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    1.3                          
Interpretation Not
Affected by Headings

     

    The division of these Terms and
Conditions into Articles and Sections, and the insertion of headings are for
convenience of reference only and will not affect the construction or
interpretation thereof.

     

    1.4                          
Applicable
Law

     

    The Warrants will be construed in
accordance with the laws of the State of Nevada and the laws of the United
States applicable thereto and will be treated in all respects as Nevada
contracts.

     

    ARTICLE
2

    ISSUE OF ADDITIONAL
WARRANTS

     

    2.1                          
Additional
Warrants

     

    The Company may at any time and from
time to time issue additional warrants or grant options or similar rights to
acquire or purchase Common Shares.

     

    2.2                          
Issue in Substitution
for Lost Warrants

     

    
      	
               
      

            	
              (a)

            	
              In
      case a Warrant becomes mutilated, lost, destroyed or stolen, the Company,
      at its discretion, may issue and deliver a new Warrant of like date and
      tenor as the one mutilated, lost, destroyed or stolen, in exchange for and
      in place of and upon cancellation of such mutilated Warrant, or in lieu
      of, and in substitution for such lost, destroyed or stolen Warrant and the
      substituted Warrant will be entitled to the benefit hereof and rank
      equally in accordance with its terms with all other Warrants issued or to
      be issued by the Company.

            

    

     

    
      	
               
      

            	
              (b)

            	
              The
      applicant for the issue of a new Warrant pursuant hereto will bear the
      cost of the issue thereof and in case of loss, destruction or theft
      furnish to the Company such evidence of ownership and of loss,
      destruction, or theft of the Warrant so lost, destroyed or stolen as will
      be satisfactory to the Company in its discretion and such applicant may
      also be required to furnish indemnity in amount and form satisfactory to
      the Company in its discretion, and will pay the reasonable charges of the
      Company in connection therewith.

            

    

     

    2.3                          
Warrant Holder Not a
Shareholder

     

    A Warrant Holder is not a shareholder
of the Company, is not entitled to any rights or interests as a shareholder of
the Company and has only the rights and interests expressly provided
herein.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    ARTICLE
3

    NOTICE

     

    3.1                          
Notice to Warrant
Holder

     

    Any notice to be given to the Holder
will be sent by prepaid registered post and will be deemed to have been received
by the Holder on the fourth day following the mailing thereof or on the date of
successful facsimile transmission or email.  Any such notice will be
addressed to the Holder at the address of the Holder appearing on the Holder's
Warrant or to such other address as the Holder may advise the Company by notice
in writing.

     

    3.2                          
Notice to the
Company

     

    Any notice to be given to the Company
may be delivered personally, or sent by facsimile or other means of electronic
communication providing a printed copy ("Electronic Communication") or may be
forwarded by first class prepaid registered mail to the addresses set forth
below.  Any notice delivered or sent by Electronic Communication shall
be deemed to have been given and received at the time of
delivery.  Any notice mailed as aforesaid shall be deemed to have been
given and received on expiration of 72 hours after it is posted, addressed as
follows:

     

    Braintech,
Inc.

    Suite 102,
930 West 1st Street

    North
Vancouver, British Columbia

    V7P
3N4

     

    Attention: 
         Secretary

     

    Facsimile
No.:     (604) 986-6131

     

    ARTICLE
4

    EXERCISE OF
WARRANTS

     

    4.1                          
Method of Exercise of
Warrants

     

    
      	
               
      

            	
              (a)

            	
              The
      right to acquire Common Shares conferred by the Warrants may be exercised
      by the Holder of such Warrant by surrendering the Warrant Certificate
      representing same, together with a duly completed and executed Exercise
      Form in the form attached hereto to the Company at its principal office in
      the City of North Vancouver, British Columbia.  The purchase
      price (the "Purchase Price") applicable at the time of exercise of any
      Warrants shall be equal to the number of Warrants exercised multiplied by
      the Exercise Price.  The Warrant Holder may pay the Purchase
      Price in cash, by delivering to the Company a bank draft or certified
      cheque payable to the Company at its principal office in the City of North
      Vancouver, British Columbia,
Canada.

            

    

     

    4.2                          
Effect of Exercise of
Warrants

     

    
      	
               
      

            	
              (a)

            	
              Upon
      surrender and payment as aforesaid the Common Shares so subscribed for
      will be deemed to have been issued and such person or persons will be
      deemed to have become the holder or holders of record of such Common
      Shares on the date of such
surrender.

            

    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (b)

            	
              Within
      ten (10) business days after surrender as aforesaid, the Company will
      forthwith cause to be delivered to the person or persons in whose name or
      names the Common Shares so subscribed for are to be issued as specified in
      such subscription or mailed to him or them at his or their respective
      addresses specified in such subscription, a certificate or certificates
      for the appropriate number of Common Shares not exceeding those which the
      Warrant Holder is entitled to acquire pursuant to the Warrant
      surrendered.

            

    

     

    4.3                          
Subscription for Less
Than Entitlement

     

    The Holder may subscribe for and
acquire a number of Common Shares, less than the number which he is entitled to
acquire pursuant to the surrendered Warrant.  In the event of any
acquisition of a number of Common Shares less than the number which can be
acquired pursuant to a Warrant, the Holder upon exercise will be entitled to
receive a new Warrant in respect of the balance of the Common Shares which he
was entitled to acquire pursuant to the surrendered Warrant and which were not
then acquired.

     

    4.4                          
Warrants for Fractions
of Shares

     

    To the extent that the Holder is
entitled to receive on the exercise or partial exercise a fraction of a Common
Share, such right may be exercised in respect of such fraction only in
combination with another Warrant or other Warrants which in the aggregate
entitle the Holder to receive a whole number of such Common Shares.

     

    4.5                          
Expiration of
Warrants

     

    After the expiration of the period
within which a Warrant is exercisable, all rights thereunder will wholly cease
and terminate and such Warrant will no longer be valid and of no
effect.

     

    4.6                          
Time of
Essence

     

    Time will be of the essence
hereof.

     

    4.7                          
Adjustments

     

    The number of Common Shares deliverable
upon the exercise of the Warrants will be subject to adjustment in the event and
in the manner following:

     

    
      	
               
      

            	
              (a)

            	
              if
      and whenever the Common Shares at any time outstanding are (i) subdivided
      into a greater number of Common Shares or the Company shall issue a stock
      dividend on the outstanding Common Shares, the number of Common Shares
      deliverable upon exercise of the Warrants will be proportionately
      increased and the Exercise Price will be proportionately decreased, or
      (ii) consolidated into a lesser number of Common Shares the number of
      Common Shares deliverable upon the exercise of the Warrants will be
      decreased proportionately and the Exercise Price will be proportionately
      increased;

            

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (b)

            	
              (i)
      in case of any capital reorganization or of any reclassification of the
      capital of the Company or in the case of the consolidation, merger or
      amalgamation of the Company with or into any other Company (hereinafter
      collectively referred to as a "Reorganization"), each Warrant will after
      such Reorganization confer the right to acquire the number of shares or
      other securities of the Company (or of the Company resulting from such
      Reorganization) which the Warrant Holder would have been entitled to upon
      Reorganization if the Warrant Holder had been a shareholder at the time of
      such Reorganization;

            

    

     

    
      	
               
      

            	
              (ii)
      in any such case, if necessary, appropriate adjustments will be made in
      the application of the provisions of this Article 4 relating to the rights
      and interest thereafter of the holders of the Warrants so that the
      provisions of this Article 4 will be made applicable as nearly as
      reasonably possible to any shares or other securities deliverable after
      the Reorganization or the exercise of the
  Warrants;

            

    

     

    
      	
               
      

            	
              (iii)
      the subdivision or consolidation of Common Shares at any time outstanding
      into a greater or lesser number of Common Shares (whether with or without
      par value) will not be deemed to be a Reorganization for the purposes of
      this Section 4.7 (b);

            

    

     

    
      	
               
      

            	
              (c)

            	
              in
      the event that the Company shall, at any time while this Warrant is
      outstanding, issue or sell Common Shares, or securities convertible into
      Common Shares, without fair consideration then in each such case the
      Exercise Price shall be lowered to equal the price per Common Share
      received or receivable by the Company in connection with such issuance or
      sale.  The decision as to whether the Company has received fair
      consideration shall be made by the Company's Board of Directors acting
      reasonably; and

            

    

     

    
      	
               
      

            	
              (d)

            	
              the
      adjustments provided for in this Section 4.7 are cumulative and will
      become effective immediately after the record date for or, if a record
      date is fixed, the effective date of the event which results in such
      adjustments.

            

    

     

    4.8                          
Determination of
Adjustments

     

    If any questions will at any time arise
with respect to any adjustment provided for in Section 4.7, such question will
be conclusively determined by the Company's Auditor, or, if they decline to so
act any other firm of chartered accountants, in Vancouver, British Columbia,
that the Company may designate and who will have access to all appropriate
records and such determination will be binding upon the Company and the holders
of the Warrants.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    ARTICLE
5

    COVENANTS BY THE
COMPANY

     

    5.1                          
Reservation of
Shares

     

    The Company will reserve and there will
remain unissued out of its authorized capital a sufficient number of Common
Shares to satisfy the rights provided for herein and in the Warrants should the
holders of all the Warrants from time to time outstanding determine to exercise
such rights in respect of all Common Shares which they are or may be entitled to
acquire pursuant thereto and hereto.

     

    5.2                          
Company May
Purchase

     

    The Company may from time to time offer
to purchase, for cancellation only, any Warrants in such manner, from such
persons and on such terms and conditions as it determines and if such offer is
accepted, then purchase such Warrants.

     

    ARTICLE
6

    WAIVER OF CERTAIN
RIGHTS

     

    6.1                          
Immunity of
Shareholders, Etc.

     

    The Warrant Holder, as part of the
consideration for the issue of the Warrants, waives and releases and will not
have any right, cause of action or remedy now or hereafter existing in any
jurisdiction against any past, present or future incorporator, shareholder,
director or officer (as such) of the Company for the issue of Common Shares
pursuant to any Warrant or on any covenant, agreement, representation or
warranty by the Company herein contained or in the Warrant.

     

    ARTICLE
7

    MODIFICATION OF TERMS,
MERGER, SUCCESSORS

     

    7.1                          
Modification of Terms
and Conditions for Certain Purposes

     

    From time to time the Company may,
subject to the provisions of these Terms and Conditions, modify the Terms and
Conditions hereof, for the purpose of correction or rectification of any
ambiguities, defective provisions, errors or omissions herein.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    7.2                          
Transferability

     

    The Warrant and all rights attached to
it are not transferable or assignable.

     

    IN WITNESS
WHEREOF BRAINTECH, INC. has caused this Warrant to be signed by its duly
authorized officers under its corporate seal, and this Warrant to be dated as of
the date of issuance first above written.

     

    SIGNED
BY:

     

    BRAINTECH,
INC.

     

    

     

    Per:          
______________________________

     Authorized Signatory

     

    Dated as
of:    September 26, 2008

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    

    EXERCISE
FORM

     

    TO:    
      Braintech, Inc.

     

    The
undersigned hereby elects to purchase ________ Common Shares of Braintech, Inc.
pursuant to the terms of the attached Warrant (only if exercised in full), and
tenders herewith payment of the purchase price in full, together with all
applicable transfer taxes, if any.

     

    Please
issue a certificate or certificates representing said Common Shares in the name
of the undersigned or in such other name as is specified below:

     

    _______________________________

     

    _______________________________

    

    The Common
Shares shall be delivered to the following:

    

    _______________________________

     

    _______________________________

     

    _______________________________

    

     

    Accredited
Investor.  The undersigned is an “accredited investor” as
defined in Regulation D promulgated under the Securities Act of 1933, as
amended.

     

    The
undersigned acknowledges that the certificates representing the Common Shares
issuable hereunder shall bear such legends as may be required under applicable
securities law.

     

    DATED this
______ day of ______________________, _____.

     

    
       

      ______________________________________________________________________

      Signature

       

       

      ______________________________________________________________________

      (Print
full name)

      
 

      ______________________________________________________________________

      (Print
full address)

       

    

     

    Instructions:

    The
registered holder may exercise his right to acquire Common Shares by completing
the above form, surrendering the Warrant Certificate and (a) providing payment
by bank draft, money order or certified cheque to the Company at its principal
office in North Vancouver, British Columbia.  For the protection of
the holder, it would be prudent to register if forwarding by
mail.  Certificates for Common Shares will be delivered or mailed as
soon as practicable after the exercise of the Warrants.  The rights of
the registered holder cease if the Warrants are not exercised prior to 5:00 p.m.
(Vancouver time) on the Expiry Date.

     

     

    9

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