EXHIBIT 4.9

                          REGISTRATION RIGHTS AGREEMENT
                          -----------------------------

      This  Registration  Rights Agreement (the "Agreement") is made and entered
into as of the  31st day of  December,  2003 by and  among  Workstream  Inc.,  a
corporation  incorporated  under the laws of  Canada  (the  "Company"),  and the
Purchasers.

      The parties hereby agree as follows:

      1. Certain Definitions.

      As used in this  Agreement,  the following  terms shall have the following
meanings:

      "Affiliate"  means,  with  respect to any person,  any other  person which
directly or indirectly  controls,  is controlled  by, or is under common control
with, such person.

      "Agent  Securities  Purchase  Agreement"  means  the  securities  purchase
agreement  dated  the  date  hereof  by and  between  the  Company  and  Sunrise
Securities Corporation ("Sunrise");

      "Business  Day" means a day,  other than a  Saturday  or Sunday,  on which
banks in New York City and Ottawa,  Ontario are open for the general transaction
of business.

      "Common Shares" shall mean the Company's Common Shares, and any securities
into which such shares may hereinafter be reclassified.

      "Letter  Agreement"  shall mean the letter agreement dated the date hereof
by and between the Company, Sunrise and Low wherein Sunrise appointed Low as its
designee.

      "Low" means Nathan Low, an adult individual.

      "Low's Warrant  Shares" means the Common Shares issuable upon the exercise
of the Low's Warrants.

      "Low's  Warrants"  means the warrants to purchase  Common Shares issued to
Low  pursuant  to  the  Agent  Securities  Purchase  Agreement  and  the  Letter
Agreement.

      "Pequot  Purchasers"  means  Pequot  Scout Fund,  L.P.,  Pequot  Navigator
Offshore Fund, Inc. and Pequot Navigator Onshore Fund, L.P., collectively.

      "Prospectus"  shall  mean  the  prospectus  included  in any  Registration
Statement, as amended or supplemented by any prospectus supplement, with respect
to the  terms of the  offering  of any  portion  of the  Registrable  Securities
covered  by  such  Registration  Statement  and  by  all  other  amendments  and
supplements  to the  prospectus,  including  post-effective  amendments  and all
material incorporated by reference in such prospectus.

      "Purchasers" or "Purchaser"  shall mean the persons and entities set forth
on Schedule A attached  hereto and, if  applicable,  any  transferee or assignee
thereof to whom the rights under this Agreement are assigned in accordance  with
Section  7(c)  hereof,  provided  that the  shareholder  or such  transferee  or
assignee shall then own the Registrable Securities.

      "Register,"  "registered" and "registration"  refer to a registration made
by  preparing  and  filing a  Registration  Statement  or  similar  document  in
compliance with the 1933 Act (as defined below), and the declaration or ordering
of effectiveness of such Registration Statement or document.


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      "Registrable  Securities"  shall mean the  Shares,  and the Common  Shares
issuable (i) upon the exercise of the Low's Warrants, if any, and (ii) any other
securities  issued or issuable  with respect to or in exchange  for  Registrable
Securities;  provided, that, a security shall cease to be a Registrable Security
upon (A) sale  pursuant to a  Registration  Statement or Rule 144 under the 1933
Act, or (B) such security becoming eligible for sale by the Purchasers  pursuant
to Rule 144(k).

      "Registration  Statement"  shall mean any  registration  statement  of the
Company  filed  under  the  1933  Act  that  covers  the  resale  of  any of the
Registrable Securities pursuant to the provisions of this Agreement,  amendments
and  supplements  to  such  Registration  Statement,   including  post-effective
amendments,  all  exhibits and all  material  incorporated  by reference in such
Registration Statement.

      "Securities  Purchase Agreements" means the securities purchase agreements
dated  the date  hereof  by and  between  the  Company  and  each of the  Pequot
Purchasers.

      "SEC" means the U.S. Securities and Exchange Commission.

      "SEC  Filings"  means the  Company's  most recent Form 10-K for the fiscal
year ended May 31, 2003 and all other  reports,  schedules,  forms or statements
filed by the Company or its subsidiaries  with the SEC under the 1933 Act or the
1934 Act on or during the 18 months preceding the date hereof;

      "Shares" means the Common Shares issued pursuant to the terms of the Agent
Securities Purchase Agreement and the Securities Purchase Agreements.

      "1933 Act" means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

      "1934 Act" means the Securities Exchange Act of 1934, as amended,  and the
rules and regulations promulgated thereunder.

      2. Registration.

                  (a) Registration Statements. Promptly following the closing of
the purchase and sale of the  securities  contemplated  by the Agent  Securities
Purchase Agreement and the Securities  Purchase  Agreements (the "Closing Date")
but no later than  forty-five  (45) days  after the  Closing  Date (the  "Filing
Deadline"),  the Company  shall  prepare and file with the SEC one  Registration
Statement on Form S-3 (or, if Form S-3 is not then available to the Company,  on
such  form  of  registration   statement  as  is  then  available  to  effect  a
registration  for  resale  of  the  Registrable   Securities,   subject  to  the
Purchasers'  consent),  covering the resale of the Registrable  Securities in an
amount at least equal to the number of Shares plus the Common  Shares  necessary
to  permit  the  exercise  in  full of the  Low's  Warrants.  Such  Registration
Statement also shall cover,  to the extent  allowable under the 1933 Act and the
rules promulgated  thereunder (including Rule 416), such indeterminate number of
additional Common Shares resulting from stock splits, stock dividends or similar
transactions  with  respect  to the  Registrable  Securities.  The  Registration
Statement  (and each  amendment  or  supplement  thereto,  and each  request for
acceleration  of  effectiveness  thereof)  shall be provided in accordance  with
Section 3(c) to the  Purchasers  and their  counsel prior to its filing or other
submission.  If a Registration  Statement covering the Registrable Securities is
not filed with the SEC on or prior to the Filing Deadline, the Company will make
pro rata payments to each Purchaser, as liquidated damages and not as a penalty,

                                       -2-
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in an  amount  equal to 1.5% of the  aggregate  amount  invested  by the  Pequot
Purchasers for each 30-day period or pro rata for any portion thereof  following
the date by which such  Registration  Statement should have been filed for which
no Registration  Statement is filed with respect to the Registrable  Securities.
Such payments shall be in partial compensation to the Purchasers,  and shall not
constitute the Purchasers' exclusive remedy for such events. Such payments shall
be made to each Purchaser in cash.

                  (b)  Expenses.  The Company will pay all  expenses  associated
with  each  registration,  including  filing  and  printing  fees,  counsel  and
accounting  fees and expenses,  costs  associated  with clearing the Registrable
Securities for sale under applicable state securities laws, listing fees and the
Purchasers'  reasonable  expenses  in  connection  with  the  registration,  but
excluding discounts, commissions, attorney's fees, fees of underwriters, selling
brokers,  dealer  managers or similar  securities  industry  professionals  with
respect to the Registrable Securities being sold.

                  (c) Effectiveness.

                  (i) The Company shall use commercially  reasonable  efforts to
have the Registration  Statement declared effective as soon as practicable.  The
Company  shall  notify the  Purchasers  by  facsimile  or e-mail as  promptly as
practicable,  and  in any  event,  within  two  (2)  Business  Days,  after  any
Registration  Statement  is declared  effective  and shall with two (2) Business
Days provide the Purchasers with copies of any related  Prospectus to be used in
connection with the sale or other disposition of the securities covered thereby.

                  (ii) No more than twice in any twelve (12) month period for an
aggregate  of not more  than  thirty  (30)  days,  the  Company  may  delay  the
disclosure  of  material  non-public  information  concerning  the  Company,  by
suspending the use of any Prospectus  included in any registration  contemplated
by this Section containing such information, the disclosure of which at the time
is not, in the good faith opinion of the Company,  in the best  interests of the
Company (an "Allowed  Delay");  provided,  that the Company  shall  promptly (a)
notify the  Purchasers in writing of the existence of (but in no event,  without
the prior  written  consent of a Purchaser,  shall the Company  disclose to such
Purchaser  any of the  facts or  circumstances  regarding)  material  non-public
information  giving rise to an Allowed  Delay,  and (b) advise the Purchasers in
writing to cease all sales under the Registration Statement until the end of the
Allowed Delay.

                  (d)  Underwritten  Offering.  If any  offering  pursuant  to a
Registration  Statement pursuant to Section 2(a) hereof involves an underwritten
offering,  the Company shall have the right to select an  investment  banker and
manager to administer the offering,  which investment banker or manager shall be
reasonably satisfactory to the Purchasers.

      3.  Company  Obligations.  The Company  will use  commercially  reasonable
efforts to effect the  registration of the Registrable  Securities in accordance
with the terms hereof,  and pursuant  thereto the Company will, as expeditiously
as possible:

                  (a)  use  commercially   reasonable   efforts  to  cause  such
Registration  Statement to become effective and to remain continuously effective
for a period that will  terminate  upon the earlier of (i) the date on which all

                                      -3-
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Registrable  Securities  covered by such Registration  Statement as amended from
time to time,  have  been  sold,  and (ii)  the  date on which  all  Registrable
Securities  covered by such Registration  Statement may be sold pursuant to Rule
144(k);

                  (b)  prepare  and  file  with  the  SEC  such  amendments  and
post-effective  amendments to the  Registration  Statement and the Prospectus as
may be necessary to keep the  Registration  Statement  effective  for the period
specified in Section 3(a) and to comply with the  provisions of the 1933 Act and
the  1934  Act  with  respect  to the  distribution  of  all of the  Registrable
Securities covered thereby;

                  (c) provide  copies to and permit  counsel  designated  by the
Purchasers  to  review  each  Registration  Statement  and  all  amendments  and
supplements  thereto no fewer than three (3) Business Days prior to their filing
with the SEC and not file any document to which such counsel reasonably objects;

                  (d)  furnish to the  Purchasers  and their  legal  counsel (i)
promptly  after the same is prepared  and publicly  distributed,  filed with the
SEC, or received by the Company (but not later than two (2) Business  Days after
the filing date,  receipt date or sending date, as the case may be) one (1) copy
of any  Registration  Statement  and any  amendment  thereto,  each  preliminary
prospectus and Prospectus  and each  amendment or supplement  thereto,  and each
letter  written  by or on behalf of the  Company  to the SEC or the staff of the
SEC,  and each item of  correspondence  from the SEC or the staff of the SEC, in
each case relating to such Registration Statement (other than any portion of any
thereof which contains information for which the Company has sought confidential
treatment),  and (ii)  such  number  of  copies  of a  Prospectus,  including  a
preliminary  prospectus,  and all  amendments and  supplements  thereto and such
other documents as each Purchaser may reasonably  request in order to facilitate
the disposition of the Registrable  Securities  owned by such Purchaser that are
covered by the related Registration Statement;

                  (e) in the event the Company  selects an  underwriter  for the
offering,  the Company shall enter into and perform its  reasonable  obligations
under an underwriting agreement, in usual and customary form, including, without
limitation,  customary  indemnification and contribution  obligations,  with the
underwriter of such offering;

                  (f) if required by the  underwriter,  or if any  Purchaser  is
described in the  Registration  Statement as an  underwriter,  the Company shall
furnish,  on the  effective  date of the  Registration  Statement  (except  with
respect to clause (i) below)  and on the date that  Registrable  Securities  are
delivered  to  an  underwriter,   if  any,  for  sale  in  connection  with  the
Registration  Statement  (including any Purchaser  deemed to be an underwriter),
(i) (A) in the case of an  underwritten  offering,  an opinion,  dated as of the
closing date of the sale of  Registrable  Securities to the  underwriters,  from
independent  legal  counsel  representing  the  Company  for  purposes  of  such
Registration  Statement, in form, scope and substance as is customarily given in
an  underwritten  public  offering,   addressed  to  the  underwriters  and  the
Purchasers  participating in such underwritten offering or (B) in the case of an
"at the  market"  offering,  an  opinion,  dated  as of or  promptly  after  the
effective date of the Registration Statement to the Purchasers, from independent
legal  counsel  representing  the  Company  for  purposes  of such  Registration

                                      -4-
<PAGE>


Statement,  in form,  scope and  substance as is  customarily  given in a public
offering,  addressed  to the  Purchasers,  and  (ii) a  letter,  dated as of the
effective date of such Registration Statement and confirmed as of the applicable
dates  described  above,  from  the  Company's   independent   certified  public
accountants  in form  and  substance  as is  customarily  given  by  independent
certified public accountants to underwriters in an underwritten public offering,
addressed  to  the  underwriters  (including  any  Purchaser  deemed  to  be  an
underwriter);

                  (g) use  commercially  reasonable  efforts to (i)  prevent the
issuance of any stop order or other  suspension  of  effectiveness  and, (ii) if
such order is issued,  obtain the  withdrawal  of any such order at the earliest
possible moment;

                  (h) prior to any public  offering of  Registrable  Securities,
use commercially reasonable efforts to register or qualify or cooperate with the
Purchasers   and  their  counsel  in  connection   with  the   registration   or
qualification  of such  Registrable  Securities  for  offer  and sale  under the
securities or blue sky laws of such  jurisdictions  requested by the  Purchasers
and do any and all other  commercially  reasonable  acts or things  necessary or
advisable to enable the  distribution in such  jurisdictions  of the Registrable
Securities covered by the Registration  Statement;  provided,  however, that the
Company shall not be required in connection  therewith or as a condition thereto
to (i) qualify to do business in any  jurisdiction  where it would not otherwise
be required to qualify but for this Section 3(h), (ii) subject itself to general
taxation in any jurisdiction  where it would not otherwise be so subject but for
this Section 3(h), or (iii) file a general  consent to service of process in any
such jurisdiction;

                  (i)  use   commercially   reasonable   efforts  to  cause  all
Registrable  Securities covered by a Registration Statement to be listed on each
securities  exchange,  interdealer  quotation  system  or other  market on which
similar securities issued by the Company are then listed;

                  (j)  immediately  notify  the  Purchasers,  at any time when a
Prospectus relating to Registrable  Securities is required to be delivered under
the 1933 Act,  upon  discovery  that,  or upon the  happening  of any event as a
result of which, the Prospectus included in a Registration Statement, as then in
effect,  includes an untrue  statement of a material  fact or omits to state any
material fact required to be stated  therein or necessary to make the statements
therein not misleading in light of the circumstances  then existing,  and at the
request of any such  holder,  promptly  prepare  and  furnish  to such  holder a
reasonable  number  of  copies  of a  supplement  to or  an  amendment  of  such
Prospectus  as  may  be  necessary  so  that,  as  thereafter  delivered  to the
purchasers of such Registrable Securities,  such Prospectus shall not include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements  therein not misleading in
light of the circumstances then existing; and

                  (k) otherwise use  commercially  reasonable  efforts to comply
with all applicable  rules and regulations of the SEC under the 1933 Act and the
1934 Act, take such other  actions as may be reasonably  necessary to facilitate
the registration of the Registrable Securities hereunder;

                  (l) With a view to  making  available  to the  Purchasers  the
benefits of Rule 144 (or its successor rule) and any other rule or regulation of
the SEC that may at any time permit the  Purchasers to sell Common Shares to the

                                      -5-
<PAGE>


public without  registration,  the Company covenants and agrees to: (i) make and
keep public information available,  as those terms are understood and defined in
Rule 144,  until the  earlier  of (A) six  months  after such date as all of the
Registrable  Securities may be resold  pursuant to Rule 144(k) or any other rule
of similar effect or (B) such date as all of the  Registrable  Securities  shall
have been  resold;  (ii) file with the SEC in a timely  manner all  reports  and
other documents required of the Company under the 1934 Act; and (iii) furnish to
each  Purchaser upon request,  as long as such  Purchaser  owns any  Registrable
Securities, (A) a written statement by the Company that it has complied with the
reporting  requirements of the 1934 Act, (B) a copy of the Company's most recent
Annual Report on Form 10-K, and (C) such other  information as may be reasonably
requested in order to avail such  Purchaser of any rule or regulation of the SEC
that   permits  the  selling  of  any  such   Registrable   Securities   without
registration.

      4. Due Diligence Review; Information.

                  (a)  Subject to Section  4(b) below,  the  Company  shall make
available,  during  normal  business  hours,  for  inspection  and review by the
Purchasers,  advisors to and  representatives  of the Purchasers (who may or may
not be affiliated  with the Purchasers and who are reasonably  acceptable to the
Company),  any underwriter  participating in any disposition of Common Shares on
behalf of the Purchasers  pursuant to a Registration  Statement or amendments or
supplements  thereto or any blue sky,  NASD or other  filing,  all financial and
other  records,  all SEC Filings and other  filings  with the SEC, and all other
corporate documents and properties of the Company as may be reasonably necessary
for the purpose of such review, and cause the Company's officers,  directors and
employees,  within a  reasonable  time  period,  to supply all such  information
reasonably  requested by the Purchasers or any such  representative,  advisor or
underwriter in connection with such Registration  Statement (including,  without
limitation,  in response to all questions and other inquiries reasonably made or
submitted  by any of them),  prior to and from time to time after the filing and
effectiveness of the Registration Statement for the sole purpose of enabling the
Purchasers  and  such  representatives,  advisors  and  underwriters  and  their
respective  accountants  and  attorneys  to  conduct  initial  and  ongoing  due
diligence  with  respect to the  Company and the  accuracy of such  Registration
Statement.


                  (b)  The  Company  shall  not  disclose   material   nonpublic
information  to the  Purchasers,  or to  advisors to or  representatives  of the
Purchasers,   unless  prior  to  disclosure  of  such  information  the  Company
identifies such information as being material nonpublic information and provides
the Purchasers, such advisors and representatives with the opportunity to accept
or refuse to accept  such  material  nonpublic  information  for  review and any
Purchaser  wishing  to  obtain  such  information  enters  into  an  appropriate
confidentiality agreement with the Company with respect thereto.

      5. Obligations of the Purchasers.

                  (a) Each  Purchaser  shall  furnish in writing to the  Company
such information regarding itself, the Registrable Securities held by it and the
intended  method of disposition  of the  Registrable  Securities  held by it, as
shall be  reasonably  required to effect the  registration  of such  Registrable
Securities and shall execute such documents in connection with such registration

                                      -6-
<PAGE>


as the Company may reasonably  request. At least five (5) Business Days prior to
the first  anticipated  filing date of any Registration  Statement,  the Company
shall notify each Purchaser of the  information  the Company  requires from such
Purchaser if such  Purchaser  elects to have any of the  Registrable  Securities
included  in  the  Registration   Statement.  A  Purchaser  shall  provide  such
information  to the  Company at least two (2)  Business  Days prior to the first
anticipated filing date of such Registration  Statement if such Purchaser elects
to  have  any  of  the  Registrable  Securities  included  in  the  Registration
Statement.

                  (b)  Each  Purchaser,  by its  acceptance  of the  Registrable
Securities  agrees to cooperate with the Company as reasonably  requested by the
Company  in  connection  with  the  preparation  and  filing  of a  Registration
Statement  hereunder,  unless such Purchaser has notified the Company in writing
of its  election  to  exclude  all  of  its  Registrable  Securities  from  such
Registration Statement.

                  (c)  In  the  event  the  Company,   at  the  request  of  the
Purchasers,  determines to engage the services of an underwriter, such Purchaser
agrees  to  enter  into  and  perform  its  obligations  under  an  underwriting
agreement, in usual and customary form, including, without limitation, customary
indemnification and contribution  obligations,  with the managing underwriter of
such offering and take such other actions as are reasonably required in order to
expedite or facilitate the dispositions of the Registrable Securities.

                  (d) Each  Purchaser  agrees  that,  upon receipt of any notice
from the Company of either (i) the  commencement of an Allowed Delay pursuant to
Section  2(c)(ii) or (ii) the  happening  of an event  pursuant to Section  3(j)
hereof, such Purchaser will immediately  discontinue  disposition of Registrable
Securities  pursuant to the  Registration  Statement  covering such  Registrable
Securities,  until the Purchaser's  receipt of the copies of the supplemented or
amended prospectus filed with the SEC and declared effective and, if so directed
by the Company,  the  Purchaser  shall deliver to the Company (at the expense of
the  Company)  or  destroy  (and  deliver  to  the  Company  a  certificate   of
destruction) all copies in the Purchaser's possession of the Prospectus covering
the Registrable Securities current at the time of receipt of such notice.

                  (e)  No  Purchaser   may   participate   in  any  third  party
underwritten registration hereunder unless it (i) agrees to sell the Registrable
Securities on the basis provided in any  underwriting  arrangements in usual and
customary  form  entered into by the Company,  (ii)  completes  and executes all
questionnaires,  powers of attorney,  indemnities,  underwriting  agreements and
other  documents  reasonably  required  under  the  terms  of such  underwriting
arrangements,  and (iii)  agrees to pay its pro rata  share of all  underwriting
discounts and commissions.  Notwithstanding the foregoing, no Purchaser shall be
required to make any representations to such underwriter,  other than those with
respect to itself and the  Registrable  Securities  owned by it,  including  its
right to sell the Registrable  Securities,  and any  indemnification in favor of
the underwriter by the Purchasers  shall be several and not joint and limited in
the case of any Purchaser,  to the proceeds  received by such Purchaser from the
sale of its Registrable  Securities.  The scope of any such  indemnification  in
favor of an  underwriter  shall be limited to the same  extent as the  indemnity
provided in Section 6(b) hereof.

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      6. Indemnification.

                  (a) Indemnification by the Company. The Company will indemnify
and hold harmless each Purchaser and its officers, directors, members, employees
and agents,  successors and assigns, and each other person, if any, who controls
such Purchaser within the meaning of the 1933 Act,  against any losses,  claims,
damages or liabilities, joint or several, to which they may become subject under
the  1933  Act  or  otherwise,  insofar  as  such  losses,  claims,  damages  or
liabilities (or actions in respect  thereof) arise out of or are based upon: (i)
any untrue  statement or alleged untrue statement of any material fact contained
in any Registration  Statement,  any preliminary  prospectus or final prospectus
contained  therein,  or any amendment or supplement  thereof;  (ii) any blue sky
application  or other  document  executed by the Company  specifically  for that
purpose or based upon written information  furnished by the Company filed in any
state or other  jurisdiction  in order to qualify any or all of the  Registrable
Securities under the securities laws thereof (any such application,  document or
information  herein  called a "Blue Sky  Application");  (iii) the  omission  or
alleged  omission to state therein a material fact required to be stated therein
or necessary to make the statements  therein not misleading;  (iv) any violation
by the  Company or its agents of any rule or  regulation  promulgated  under the
1933 Act  applicable  to the  Company or its agents  and  relating  to action or
inaction  required of the Company in connection with such  registration;  or (v)
any failure to register or qualify the  Registrable  Securities  included in any
such registration in any state where the Company or its agents has affirmatively
undertaken  or  agreed  in  writing  that  the  Company  will   undertake   such
registration or  qualification  on a Purchaser's  behalf (the undertaking of any
underwriter  chosen by the Company  being  attributed  to the  Company) and will
reimburse  such  Purchaser,  and each such officer,  director or member and each
such controlling person for any legal or other expenses  reasonably  incurred by
them in connection with investigating or defending any such loss, claim, damage,
liability or action;  provided,  however, that the Company will not be liable in
any such  case if and to the  extent  that  any  such  loss,  claim,  damage  or
liability  arises out of or is based upon an untrue  statement or alleged untrue
statement or omission or alleged omission so made in conformity with information
furnished  by  such  Purchaser  or  any  such  controlling   person  in  writing
specifically for use in such Registration Statement or Prospectus.

                  (b) Indemnification by the Purchasers.  In connection with any
registration  pursuant  to the  terms of this  Agreement,  each  Purchaser  will
furnish to the Company in writing  such  information  as the Company  reasonably
requests concerning the holders of Registrable Securities or the proposed manner
of  distribution  for use in  connection  with  any  Registration  Statement  or
Prospectus  and  agrees,  severally  but not  jointly,  to  indemnify  and  hold
harmless,  to the fullest extent  permitted by law, the Company,  its directors,
officers,  employees,  stockholders  and each  person who  controls  the Company
(within  the  meaning of the 1933 Act)  against  any  losses,  claims,  damages,
liabilities and expense (including  reasonable attorney fees) resulting from any
untrue  statement of a material fact or any omission of a material fact required
to be  stated  in  the  Registration  Statement  or  Prospectus  or  preliminary
prospectus  or  amendment  or  supplement  thereto  or  necessary  to  make  the
statements  therein not misleading,  to the extent,  but only to the extent that
such untrue  statement or omission is contained in any information  furnished in
writing by such  Purchaser  to the Company  specifically  for  inclusion in such
Registration  Statement or Prospectus or amendment or supplement  thereto. In no
event shall the  liability  of a Purchaser  be greater in amount than the dollar
amount of the proceeds (net of all expense paid by such  Purchaser in connection
with any claim  relating to this  Section 6 and the amount of any  damages  such

                                      -8-
<PAGE>


holder has otherwise been required to pay by reason of such untrue  statement or
omission) received by such Purchaser upon the sale of the Registrable Securities
included  in the  Registration  Statement  giving  rise to such  indemnification
obligation.

                  (c)  Conduct  of  Indemnification   Proceedings.   Any  person
entitled  to  indemnification  hereunder  shall  (i) give  prompt  notice to the
indemnifying  party of any claim with respect to which it seeks  indemnification
and (ii) permit such indemnifying party to assume the defense of such claim with
counsel  reasonably  satisfactory  to the indemnified  party;  provided that any
person  entitled  to  indemnification  hereunder  shall have the right to employ
separate  counsel and to participate in the defense of such claim,  but the fees
and expenses of such counsel  shall be at the expense of such person  unless (a)
the  indemnifying  party has  agreed to pay such  fees or  expenses,  or (b) the
indemnifying  party  shall have  failed to assume the  defense of such claim and
employ counsel  reasonably  satisfactory to such person or (c) in the reasonable
judgment  of any such  person,  based  upon  written  advice of its  counsel,  a
conflict of interest exists between such person and the indemnifying  party with
respect to such claims (in which case, if the person  notifies the  indemnifying
party in  writing  that such  person  elects to employ  separate  counsel at the
expense of the indemnifying  party,  the  indemnifying  party shall not have the
right to  assume  the  defense  of such  claim on behalf  of such  person);  and
provided,  further,  that the failure of any indemnified party to give notice as
provided  herein  shall not relieve the  indemnifying  party of its  obligations
hereunder,  except  to the  extent  that  such  failure  to  give  notice  shall
materially  adversely affect the  indemnifying  party in the defense of any such
claim or litigation.  It is understood that the indemnifying party shall not, in
connection with any proceeding in the same  jurisdiction,  be liable for fees or
expenses of more than one  separate  firm of  attorneys at any time for all such
indemnified  parties. No indemnifying party will, except with the consent of the
indemnified party, consent to entry of any judgment or enter into any settlement
that  does not  include  as an  unconditional  term  thereof  the  giving by the
claimant or plaintiff to such indemnified  party of a release from all liability
in respect of such claim or litigation.

                  (d)  Contribution.  If  for  any  reason  the  indemnification
provided  for in the  preceding  paragraphs  (a)  and (b) is  unavailable  to an
indemnified  party or insufficient to hold it harmless,  other than as expressly
specified  therein,  then the indemnifying  party shall contribute to the amount
paid or payable by the indemnified party as a result of such loss, claim, damage
or liability in such  proportion as is appropriate to reflect the relative fault
of the  indemnified  party  and the  indemnifying  party,  as well as any  other
relevant   equitable   considerations.    No   person   guilty   of   fraudulent
misrepresentation  within the meaning of Section  11(f) of the 1933 Act shall be
entitled  to  contribution  from  any  person  not  guilty  of  such  fraudulent
misrepresentation.  In no event shall the contribution obligation of a holder of
Registrable  Securities  be  greater  in amount  than the  dollar  amount of the
proceeds (net of all expenses  paid by such holder in connection  with any claim
relating  to this  Section  6 and the  amount of any  damages  such  holder  has
otherwise  been  required  to pay by reason of such  untrue  or  alleged  untrue
statement or omission or alleged  omission)  received by it upon the sale of the
Registrable Securities giving rise to such contribution obligation.

                                      -9-
<PAGE>


      7. Miscellaneous.

                  (a) Amendments and Waivers. This Agreement may be amended only
by a writing signed by the Company and the Purchasers.  The Company may take any
action  herein  prohibited,  or omit to perform  any act herein  required  to be
performed by it, only if the Company shall have obtained the written  consent to
such  amendment,  action or  omission  to act,  of Low,  having  first  received
approval of the Purchasers.


                  (b)  Notices.  Any notice or other  communication  to be given
hereunder  shall be in writing and shall be given by delivery or by  telecopier,
as follows:

            if to the Company:

            Workstream Inc.
            495 March Road, Suite 300
            Ottawa, Ontario
            J2K 3G1

            Attention:  Mr. Michael Mullarkey
            Fax:  (613) 270-0774

            with a copy to:

            Perley-Robertson, Hill and McDougall LLP
            90 Sparks Street, 4th Floor
            Ottawa, Ontario
            K1P 1E2

            Attention: Michael Gerrior
            Fax:  (613) 238-8775

            or if to the Pequot Purchasers:

            -------------------------------

            -------------------------------

            -------------------------------

            Attention:
                        ---------------
            Fax:
                  -------------------

            or if to Low:


            Attention:

            Fax:

and if so given, shall be deemed to have been given and received upon receipt by
the  addressee or a responsible  officer of the addressee if delivered,  or four
hours after being telecopied and receipt  confirmed during normal business hours
at the  location  of the  recipient,  as the case may be. Any party may,  at any
time,  give notice in writing to the others in the manner  provided for above of
any change of address or telecopier number.

                                      -10-
<PAGE>


                  (c) Assignments and Transfers by Purchasers. The provisions of
this Agreement  shall be binding upon and inure to the benefit of the Purchasers
and their respective successors and assigns. A Purchaser may transfer or assign,
in  whole  or from  time to time in  part,  to one or more  persons  its  rights
hereunder in  connection  with the transfer of  Registrable  Securities  by such
Purchaser to such person,  provided that such  Purchaser  complies with all laws
applicable  thereto and provides  written  notice of  assignment  to the Company
promptly after such assignment is effected.  Further, any transferee or assignee
to whom rights under this  Agreement are  transferred  shall,  as a condition to
such  transfer,  deliver to the Company a written  instrument  pursuant to which
such transferee or assignee  agrees to be bound by the obligations  imposed upon
the Purchaser under this Agreement to the same extent as if such transferee were
an original Purchaser hereunder.

                  (d) Assignments  and Transfers by the Company.  This Agreement
may not be assigned by the Company  (whether by operation  of law or  otherwise)
without the prior written consent of the Purchasers, provided, however, that the
Company may assign its rights and delegate its duties hereunder to any surviving
or successor  corporation in connection  with a merger or  consolidation  of the
Company with another  corporation,  or a sale,  transfer or other disposition of
all or substantially all of the Company's assets to another corporation, without
the prior  written  consent of the  Purchasers,  after  notice duly given by the
Company to each Purchaser.

                  (e) Benefits of the  Agreement.  The terms and  conditions  of
this Agreement  shall inure to the benefit of and be binding upon the respective
permitted  successors  and assigns of the  parties.  Nothing in this  Agreement,
express or implied,  is intended to confer upon any party other than the parties
hereto  or  their  respective  successors  and  assigns  any  rights,  remedies,
obligations,  or  liabilities  under or by reason of this  Agreement,  except as
expressly provided in this Agreement.

                  (f) Counterparts; Faxes. 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.  This Agreement may
also be executed via facsimile, which shall be deemed an original.

                  (g) Titles and  Subtitles.  The titles and  subtitles  used in
this  Agreement  are used for  convenience  only and are not to be considered in
construing or interpreting this Agreement.

                  (h)  Severability.  Any  provision of this  Agreement  that is
prohibited or unenforceable in any jurisdiction  shall, as to such jurisdiction,
be ineffective to the extent of such  prohibition  or  unenforceability  without
invalidating the remaining  provisions  hereof but shall be interpreted as if it
were  written  so as to be  enforceable  to  the  maximum  extent  permitted  by
applicable law, and any such prohibition or unenforceability in any jurisdiction
shall  not  invalidate  or  render  unenforceable  such  provision  in any other

                                      -11-
<PAGE>


jurisdiction.  To the extent  permitted by  applicable  law, the parties  hereby
waive any provision of law which  renders any  provisions  hereof  prohibited or
unenforceable in any respect.

                  (i) Further Assurances.  The parties shall execute and deliver
all such further  instruments  and  documents and take all such other actions as
may reasonably be required to carry out the transactions contemplated hereby and
to evidence the fulfillment of the agreements herein contained.

                  (j)  Entire  Agreement.  This  Agreement  is  intended  by the
parties as a final  expression of their  agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein. This Agreement supersedes all
prior  agreements  and  understandings  between the parties with respect to such
subject matter.

                  (k) Governing  Law;  Consent to  Jurisdiction.  Governing Law;
Venue;  Waiver  of  Jury  Trail.  ALL  QUESTIONS  CONCERNING  THE  CONSTRUCTION,
VALIDITY,  ENFORCEMENT AND INTERPRETATION OF THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
THE  COMPANY  AND EACH  PURCHASER  HEREBY  IRREVOCABLY  SUBMIT TO THE  EXCLUSIVE
JURISDICTION  OF THE STATE AND FEDERAL  COURTS  SITTING IN THE CITY OF NEW YORK,
BOROUGH OF MANHATTAN FOR THE  ADJUDICATION OF ANY DISPUTE BROUGHT BY THE COMPANY
OR ANY  PURCHASER  HEREUNDER,  IN  CONNECTION  HEREWITH OR WITH ANY  TRANSACTION
CONTEMPLATED HEREBY OR DISCUSSED HEREIN, AND HEREBY IRREVOCABLY WAIVE, AND AGREE
NOT TO ASSERT IN ANY SUIT,  ACTION OR  PROCEEDING  BROUGHT BY THE COMPANY OR ANY
PURCHASER,  ANY CLAIM THAT IT IS NOT PERSONALLY  SUBJECT TO THE  JURISDICTION OF
ANY SUCH COURT, OR THAT SUCH SUIT, ACTION OR PROCEEDING IS IMPROPER.  EACH PARTY
HEREBY  IRREVOCABLY  WAIVES PERSONAL  SERVICE OF PROCESS AND CONSENTS TO PROCESS
BEING SERVED IN ANY SUCH SUIT,  ACTION OR  PROCEEDING  BY MAILING A COPY THEREOF
VIA  REGISTERED  OR  CERTIFIED  MAIL OR  OVERNIGHT  DELIVERY  (WITH  EVIDENCE OF
DELIVERY)  TO SUCH PARTY AT THE  ADDRESS IN EFFECT FOR  NOTICES TO IT UNDER THIS
AGREEMENT  AND AGREES THAT SUCH SERVICE  SHALL  CONSTITUTE  GOOD AND  SUFFICIENT
SERVICE OF PROCESS AND NOTICE THEREOF.  NOTHING CONTAINED HEREIN SHALL BE DEEMED
TO LIMIT IN ANY WAY ANY RIGHT TO SERVE  PROCESS IN ANY MANNER  PERMITTED BY LAW.
THE COMPANY AND EACH PURCHASER HEREBY WAIVE ALL RIGHTS TO A TRIAL BY JURY.

                                      -12-
<PAGE>


      IN WITNESS  WHEREOF,  the parties have executed  this  Agreement or caused
their duly  authorized  officers to execute this  Agreement as of the date first
above written.


The Company:                  WORKSTREAM INC.



                              By: /s/ Michael Mullarkey
                                  --------------------------------------------
                              Name: Michael Mullarkey
                              Title: President and Chief Executive Officer


The Purchasers:

                              By:_____________________________
                                 Name:
                                 Title:


                                      -13-
<PAGE>


                                   SCHEDULE A
                                   ----------

                                   PURCHASERS
                                   ----------

Nathan Low
Pequot Scout Fund, L.P.
Pequot Navigator Offshore Fund, Inc.
Pequot Navigator Onshore Fund, L.P.



                                      -14-