<PAGE>

                                                                  EXHIBIT 2.4

                                     [LOGO]

                                                               March 15, 2000

Arthur Ritchie
President/Chief Executive Officer
Sand Technology Inc.
4141 Sherbrooke St. W., Suite 410
Westmount
Quebec H3Z 1B8, Canada

Dear Mr. Ritchie:

The purpose of this letter agreement (the "Agreement") is to set forth the
terms and conditions pursuant to which Ladenburg Thalmann & Co. Inc. ("LTCO")
shall serve as exclusive placement agent in connection with the proposed
offering (the "Offering") of equity securities (the "Securities") of Sand
Technology Inc. (the "Company") pursuant to a registration statement. The
gross proceeds from the Offering will be up to $30,000,000. All references to
dollars shall be to U.S. dollars. The terms of such Offering and the
Securities shall be substantially in the form set forth in Exhibit D hereto,
which exhibit is incorporated by reference herein.

     Upon the terms and subject to the conditions of this Agreement, the
parties hereto agree as follows:

     1.   APPOINTMENT. (a) Subject to the terms and conditions of this
Agreement hereinafter set forth, the Company hereby retains LTCO, and LTCO
hereby agrees to act as the Company's exclusive placement agent and financial
advisor in connection with the Offering, effective as of the date hereof
through the Termination Date. The Company expressly acknowledges and agrees
that LTCO's obligations hereunder are on a reasonable best efforts basis only
and that the execution of this Agreement does not constitute a commitment by
LTCO to purchase the Securities and does not ensure the successful placement
of the Securities or any portion hereof or the success of LTCO with respect
to securing any other financing on behalf of the Company.

     (b) Except as set forth below in this Section 1, and except for
financings with Sofinov, SGF Tech Inc., and/or Royal Bank Ventures Inc.,
during the effectiveness of this Agreement, neither the Company nor any of
its subsidiaries or affiliates shall, directly or indirectly, through any
officer, director, employee, agent or otherwise (including, without
limitation, through any placement agent, broker, investment banker, attorney
or accountant retained by the Company or any of its subsidiaries or
affiliates), solicit, initiate or encourage the submission of any proposal or
offer (an "Investment Proposal") from any person or entity
<PAGE>

(including any of such person's or entity's officers, directors, employees,
agents and other representatives) relating to any issuance of the Company's
or any of its subsidiaries' equity securities (including debt securities with
any equity feature but excluding any commercial loan transactions) or
relating to any other transaction having a similar effect or result on the
Company's or any of its subsidiaries' capitalization, or participate in any
negotiations regarding any of the foregoing. The Company shall immediately
cease and cause to be terminated any and all contacts, discussions and
negotiations with third parties regarding any Investment Proposal. The
Company shall promptly notify LTCO if any such Investment Proposal, or any
inquiry or contact with any person or entity with respect thereto, is made.
The Company shall not provide or release any information with respect to this
Agreement or the Offering except as required by law or as may be necessary to
enforce the Company's rights hereunder.

     (c) Notwithstanding anything to the contrary contained herein, in the
event that LTCO shall not provide to the Company within 60 days after the
date hereof, one or more qualified institutional investors reasonably
acceptable to the Company willing to invest in the Offering on substantially
the same terms as outlined in the term sheet marked Exhibit D, the Company
shall have the right to terminate this Agreement upon a ten-day written
notice and the Company shall have no further obligation to pay any fees,
compensation or expenses to LTCO, except as set forth in Section 3(b)(ii)
below.

     2.   FEES AND COMPENSATION. In consideration of the services rendered by
LTCO in connection with the Offering, the Company agrees to pay LTCO the
following fees and other compensation:

     (a)  1)  6% warrant coverage as commitment fee payable immediately upon
              the initial closing. The warrant coverage shall be determined as
              follows: 6% the aggregate dollar amount of the Offering/the
              closing bid price of the Company's common stock on the trading
              day prior to the initial closing. The warrants shall have a term
              of three years and a strike price equal to 115% of the closing
              bid price of the Company's common stock on the trading day prior
              to the initial closing; and

          2)  a cash fee payable upon the initial and each subsequent closing
              equal to 6% of the amount drawn down by the Company at each such
              closing; and

     (b)  $35,000 non-accountable expense allowance.

     (c)  All amounts payable hereunder shall be paid to LTCO out of an
          attorney escrow account at the closing or by such other means
          acceptable to LTCO.

     (d)  Should LTCO provide a qualified institutional investor(s)
          reasonably acceptable to the Company and such investor(s) is willing
          to invest in the Offering on substantially the same terms as
          outlined in the term sheet marked Exhibit D and otherwise acceptable
          to the Company, and the Company were to terminate the Agreement after
          March 15, 2000 or prior to March 15, 2001 (the "Termination Date"),
          for reasons other than a breach of this Agreement by


                                       2
<PAGE>

          LTCO, the Company will pay $200,000 to LTCO as a "break-up" fee.

     3.   TERMS OF RETENTION. (a) Unless extended or terminated in writing by
the parties hereto in accordance with the provisions hereof, this Agreement
shall remain in effect until the Termination Date of March 15, 2001.

     (b)(i)   Notwithstanding anything herein to the contrary but subject to
Section 2(d), the obligation to pay the Fees and Compensation and Expenses
described in Section 2, if any, and paragraphs 2, 6, and 8 of Exhibit A and
all of Exhibit B and Exhibit C attached hereto, each of which exhibits is
incorporated herein by reference, shall survive any termination or expiration
of the Agreement.

     (b)(ii)  It is expressly understood and agreed by the parties hereto
that any private financing of equity or debt or other capital raising
activity of the Company within 24 months of the termination or expiration of
this Agreement, with any investors to whom the Company was introduced by LTCO
or who was solicited by LTCO to participate in the Offering while this
Agreement was in effect and disclosed to the Company in writing within 3
business days after the date of such solicitation, shall result in such fees
and compensation being due and payable by the Company to LTCO under the same
terms of Section 2 above.

     4.   INTENTIONALLY OMITTED.

     5.   INFORMATION. The Company recognizes and confirms that in completing
its engagement hereunder, LTCO will be using and relying on publicly
available information and on data, material and other information furnished
to LTCO by the Company or the Company's affiliates and agents. It is
understood and agreed that in performing under this engagement, LTCO will
rely upon the accuracy and completeness of, and is not assuming any
responsibility for independent verification of, such publicly available
information and the other information so furnished. Notwithstanding the
foregoing, it is understood that LTCO will conduct a due diligence
investigation of the Company and the Company will cooperate in all respects
with such investigation as a condition of LTCO's obligations hereunder.

     6.   REGISTRATION. The Company shall prepare and file with the SEC a
registration statement. From time to time in connection with any particular
sale of Securities, the Company will, at its own expense, obtain any
registration or qualification required to sell any Securities under the Blue
Sky laws of any applicable jurisdictions, as reasonably requested by LTCO in
connection with this sale of such securities, provided that the Company will
not be required to register or qualify in any jurisdiction which would
require it to qualify to do business or to file a general consent to service
of process.


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<PAGE>

     7.   NO GENERAL SOLICITATION. The Securities will be offered only by
approaching prospective purchasers on an individual basis. No general
solicitation or general advertising in any form will be used in connection
with the offering of the Securities. From and after the filing of the
registration statement, the Company shall provide LTCO with an advance copy
of any proposed press release and consider in good faith any comments made by
LTCO.

     8.   CLOSING. The closing of the sale of the Securities shall be subject
to customary closing conditions, including the provision at closing by the
Company of officers' certificates, opinions of counsel and "cold comfort"
letters from the Company's auditors.

     9.   MISCELLANEOUS. This Agreement together with the attached Exhibits A
through D constitutes the entire understanding and agreement between the
parties with respect to its subject matter and there are no agreements or
understandings with respect to the subject matter hereof which are not
contained in this Agreement. This Agreement may be modified only in writing
signed by the party to be charged hereunder.

     If the foregoing correctly sets forth our agreement, please confirm this
by signing and returning to us the duplicate copy of this letter.

     We appreciate this opportunity to be of service and are looking forward
to working with you on this matter.


                                       Very truly yours,

                                       LADENBURG THALMANN & CO. INC.



                                       By: /s/ Edward Kovalick
                                           ----------------------------------
                                           Name:
                                           Title:


Agreed to and accepted
as of the date first written above:

SAND TECHNOLOGY INC.


By: /s/ Arthur G. Ritchie
    -------------------------------
    Name: A.G. Ritchie
    Title: President & CEO
           March 16, 2000



                                                                    EXHIBIT A

                         STANDARD TERMS AND CONDITIONS

1.   The Company shall promptly provide LTCO with all relevant information
     about the Company (to the extent available to the Company in the case of
     parties other than the Company) that shall be reasonably requested or


                                       4
<PAGE>

     required by LTCO, which information shall be accurate in all material
     respects at the time furnished.

2.   LTCO shall keep all information obtained from the Company strictly
     confidential except: (a) information which is otherwise publicly
     available, or previously known to, or obtained by LTCO independently of
     the Company and without breach of an agreement with the Company; (b)
     LTCO may disclose such information to its employees and attorneys, and
     to its other advisors and financial sources on a need to know basis only
     and shall ensure that all such employees, attorneys, advisors and
     financial sources will keep such information strictly confidential; and
     (c) pursuant to any order of a court of competent jurisdiction or other
     governmental body or as may otherwise be required by law.

3.   The Company recognizes that in order for LTCO to perform properly its
     obligations in a professional manner, it is necessary that LTCO be
     informed of and, to the extent practicable, participate in meetings and
     discussions between the Company and any third party relating to the
     matters covered by the terms of LTCO's engagement.

4.   The Company agrees that any report or opinion, oral or written,
     delivered to it by LTCO is prepared solely for its confidential use and
     shall not be reproduced, summarized, or referred to in any public document
     or given or otherwise divulged to any other person without LTCO's prior
     written consent, except as may be required by applicable law or regulation.

5.   No fee payable to LTCO pursuant to any other agreement with the Company
     or payable by the Company to any agent, lender or investor shall reduce or
     otherwise affect any fee payable by the Company to LTCO hereunder.

6.   The Company represents and warrants that: (a) it has full right, power
     and authority to enter into this Agreement and to perform all of its
     obligations hereunder; (b) this Agreement has been duly authorized and
     executed and constitutes a valid and binding agreement of the Company
     enforceable in accordance with its terms; and (c) the execution and
     delivery of this Agreement and the consummation of the transactions
     contemplated hereby do not conflict with or result in a breach of (i)
     the Company's certificate of incorporation or by-laws or (ii) any
     agreement to which the Company is a party or by which any of its property
     or assets is bound.


                                       5
<PAGE>

                                                        EXHIBIT A (CONTINUED)

7.   Nothing contained in this Agreement shall be construed to place LTCO and
     the Company in the relationship of partners or joint venturers. Neither
     LTCO nor the Company shall represent itself as the agent or legal
     representative of the other for any purpose whatsoever nor shall either
     have the power to obligate or bind the other in any manner whatsoever.
     LTCO, in performing its services hereunder, shall at all times be an
     independent contractor.

8.   This Agreement has been and is made solely for the benefit of LTCO and
     the Company and each of the persons, agents, employees, officers,
     directors and controlling persons referred to in Exhibit B and their
     respective heirs, executors, personal representatives, successors and
     assigns, and nothing contained in this Agreement shall confer any rights
     upon, nor shall this Agreement be construed to create any rights in, any
     person who is not party to such Agreement, other than as set forth in
     this paragraph.

9.   The rights and obligations of either party under this Agreement may not
     be assigned without the prior written consent of the other party hereto
     and any other purported assignment shall be null and void.

10.  All communications hereunder, except as may be otherwise specifically
     provided herein, shall be in writing and shall be mailed, hand delivered,
     or sent via facsimile and confirmed by letter, to the party to whom it is
     addressed at the following addresses or such other address as such party
     may advise the other in writing:

              To the Company:
              Arthur Ritchie
              Sand Technology Inc.
              4141 Sherbrooke St. W. St. 410,
              Westmount
              Quebec H3Z 1B8, Canada
              Telephone: (514) 939-3477
              Facsimile: (514) 939-2042

              To LTCO:
              Ladenburg Thalmann & Co. Inc.
              590 Madison Avenue
              New York, NY 10022
              Attention: David B. Boris
              Telephone: (212) 409-2000
              Facsimile: (212) 409-2169

All notices hereunder shall be effective upon receipt by the party to which
it is addressed.


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<PAGE>

                                                                    EXHIBIT B

                                INDEMNIFICATION

     The Company agrees that it shall indemnify and hold harmless, LTCO, its
stockholders, directors, officers, employees, agents, affiliates and
controlling persons within the meaning of Section 20 of the Securities
Exchange Act of 1934 and Section 15 of the Securities Act of 1933, each as
amended (any and all of whom are referred to as an "Indemnified Party"), from
and against any and all losses, claims, damages, liabilities, or expenses,
and all actions in respect thereof (including, but not limited to, all legal
or other expenses reasonably incurred by an Indemnified Party in connection
with the investigation, preparation, defense or settlement of any claim,
action or processing, whether or not resulting in any liability), incurred by
an Indemnified Party: (a) arising out of, or in connection with, any actions
taken or omitted to be taken by the Company, its affiliates, employees or
agents, or any untrue statement or alleged untrue statement of a material
fact contained in any of the financial or other information contained in the
registration statement and/or final prospectus furnished to LTCO by or on
behalf of the Company or the omission or alleged omission of a material fact
required to be stated herein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading; or (b)
with respect to, caused by, or otherwise arising out of any transaction
contemplated by the Agreement or LTCO's performing the services contemplated
hereunder; PROVIDED, HOWEVER, the Company will not be liable under clause (b)
hereof to the extent, and only to the extent, that any loss, claim, damage,
liability or expense is finally judicially determined to have resulted
primarily from LTCO's gross negligence, breach of agreement or bad faith in
performing such services.

     If the indemnification provided for herein is conclusively determined
(by an entry of final judgment by a court of competent jurisdiction and the
expiration of the time or denial of the right to appeal) to be unavailable or
insufficient to hold any Indemnified Party harmless in respect to any losses,
claims, damages, liabilities or expenses referred to therein, then the
Company shall contribute to the amounts paid or payable by such Indemnified
Party in such proportion as is appropriate and equitable under all
circumstances taking into account the relative benefits received by the
Company on the one hand and LTCO on the other, from the transaction or
proposed transaction under the Agreement or, if allocation on that basis is
not permitted under applicable law, in such proportion as is appropriate to
reflect not only the relative benefits received by the Company on the one
hand and LTCO on the other, but also the relative fault of the Company and
LTCO; PROVIDED, HOWEVER, in no event shall the aggregate contribution of LTCO
and/or any Indemnified Party be in excess of net compensation actually
received by LTCO and/or such Indemnified Party pursuant to this Agreement.

     The Company shall not settle or compromise or consent to the entry of
any judgment in or otherwise seek to terminate any pending or threatened
action,


                                       7
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claim, suit or proceeding in which any Indemnified Party is or could be a
party and as to which Indemnification or contribution could have been sought
by such Indemnified Party hereunder (whether or not such Indemnified Party is
a party thereto), unless such consent or termination includes an express
unconditional release of such Indemnified Party, reasonably satisfactory in
form and substance to such Indemnified Party, from all losses, claims,
damages, liabilities or expenses arising out of such action, claim, suit or
proceeding.

     The foregoing indemnification and contribution provisions are not in
lieu of, but in addition to, any rights which any Indemnified Party may have
at common law hereunder or otherwise, and shall remain in full force and
effect following the expiration or termination of LTCO's engagement and shall
be binding on any successors or assigns of the Company and successors or
assigns to all or substantially all of the Company's business or assets.


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<PAGE>

                                                                    EXHIBIT C

                                 JURISDICTION

     The Company hereby irrevocably: (a) submits to the jurisdiction of any
federal court sitting in the State of New York for the purposes of any suit,
action or other proceeding arising out the Agreement between the Company and
LTCO which is brought by or against the Company or LTCO; (b) agrees that all
claims in respect of any suit, action or proceeding may be heard and
determined in any such court; and (c) to the extent that the Company has
acquired, or hereafter may acquire, any immunity from jurisdiction of any
such court or from any legal process therein, the Company hereby waives, to
the fullest extent permitted by law, such immunity.

     The Company waives, and the Company agrees not to assert in any such
suit, action or proceeding, in each case, to the fullest extent permitted by
applicable law, any claim that: (a) the Company is not personally subject to
the jurisdiction of any such court; (b) the Company is immune from any legal
process (whether through service or notice, attachment prior to judgment,
attachment in the aid of execution, execution or otherwise) with respect to
it or its property; (c) any such suit, action or proceeding is brought in an
inconvenient forum; (d) the venue of any such suit, action or proceeding is
improper; or (e) this Agreement may not be enforced in or by any such court.

     Any process against the Company in, or in connection with, any suit,
action or proceeding filed in the United States District Court for the
Southern District of New York arising out of or relating to this Agreement or
any transaction or agreement contemplated hereby, may be served on the
Company personally, or by first class mail or overnight courier (with the
same effect as though served upon the Company personally) addressed to the
Company at the address set forth in the Agreement between the Company and
LTCO.

     Nothing in these provisions shall affect any party's right to serve
process in any manner permitted by law or limit its rights to bring a
proceeding in the competent courts of any jurisdiction or jurisdictions or to
enforce in any lawful manner a judgment obtained in one jurisdiction in any
other jurisdiction.

     This Agreement shall be governed by and construed in accordance with the
laws of the State of New York, without regard to conflicts of law principles.


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                                     [LOGO]

                                                                    EXHIBIT D

                              SAND TECHNOLOGY, INC.
                                Ticker:    SNDT
                                Exchange:  NASDAQ

                $30,000,000 UNDERWRITTEN OFFERING OF COMMON STOCK

SECURITIES:                  COMMON STOCK

TOTAL DRAW DOWN COMMITMENT:  UP TO $30,000,000

DRAW DOWN AMOUNT:            UP TO $3,000,000

USE OF PROCEEDS:             [_____________]

DRAW DOWN TERMS:

          (a)            The Company may, in its sole discretion, issue and
                         exercise a draw down (a "DRAW DOWN") during a Draw
                         Down Pricing Period (which shall mean a period of 22
                         consecutive trading days preceding a Draw Down
                         Exercise Date, as defined below), which Draw Down the
                         Investor will be obligated to accept.

          (b)            Only one Draw Down shall be allowed in each Draw
                         Down Pricing Period. The Draw Down shall occur on the
                         first trading day following the end of the Draw Down
                         Pricing Period (the "DRAW DOWN EXERCISE DATE"), based
                         on the Average Daily Price during the Draw Down
                         Pricing Period.

          (c)            There shall be a maximum of 12 Draw Downs during the
                         term of this Equity Line of Credit.

          (d)            Each Draw Down will expire on the calendar day after
                         the Draw Down Exercise Date.

          (e)            The Company must inform the Investor via facsimile
                         transmission as to the amount of the Draw Down the
                         Company wishes to exercise before the first day of the
                         Draw Down Pricing Period (the "DRAW DOWN NOTICE"). At
                         no time shall the Investor be required to purchase
                         more than the scheduled Draw Down amount for a given
                         Draw Down Pricing Period so that if the Company
                         chooses not to exercise the Draw Down in a given Draw
                         Down Pricing Period the Investor is not obligated to
                         purchase more than the scheduled amount in a
                         subsequent Draw Down Pricing Period.

PRICING:
<PAGE>

          (a)            Commencing on the Effective Date of the Registration
                         Statement and continuing for a period of 12 months
                         thereafter, the Investor agrees to honor Draw Down
                         requests from the Company for a total of up to
                         $30,000,000 of the Company's Common Stock based upon
                         Draw Downs of $3,000,000 per Draw Down and a per share
                         purchase price equal to 90% of the Average Daily Price
                         for the Draw Down Pricing Period.


          (b)            If the Average Daily Price on a given trading day is
                         less than the Threshold Price then the Investor's
                         payment obligation under the Draw Down will be reduced
                         by 1/22nd for such trading day and the corresponding
                         portion of the Draw Down amount shall be withdrawn
                         from the Draw Down Pricing Period. At no time shall
                         the Threshold Price be set below $5.00 unless agreed
                         upon by the Company and the Investor.


CONDITIONS:

          (a)            The Company shall cause to be filed a Registration
                         Statement, which Registration Statement shall
                         provide for the sale of the Common Stock purchased
                         by and issued to the Investor hereunder. The
                         Investor shall provide the Company with such
                         information about the Investor and its intended
                         resale of the common stock as may be required for
                         the Registration Statement. Before the Investor
                         shall be obligated to accept a Draw Down request
                         from the Company, the Company shall have caused a
                         sufficient number of shares of Comon Stock to be
                         registered to cover the shares of Common Stock to be
                         issued in connection with such Draw Down.

          (b)            Such Common Stock shall be placed in a mutually
                         agreed upon escrow account before the issuance of a
                         Draw Down request. The shares of Common Stock shall
                         be settled on a weekly basis through the DTC system.

          (c)            The Investor may terminate this Draw Down facility
                         if a Material Adverse Effect or a Material Change of
                         Ownership has occurred.

          (d)            The Company shall pay all fees and expenses related
                         to the transactions contemplated by this Agreement.
                         The Company shall pay at the Closing all attorneys
                         fees and expenses incurred by the Investor of up to
                         $35,000.

LIMITATION ON ISSUANCE:  The Company shall not issue more than 20% of common
                         shares outstanding without shareholder approval.

CONFIDENTIALITY:         The Company agrees that it will not disclose, and
                         will not include in any public announcement, the name
                         or names of the Investor, unless expressly agreed to
                         by the Investor or unless and until such disclosure is
                         required by law or regulation, and then only to the
                         extent of such requirement.

DOCUMENTATION:           The definitive documentation shall contain such
                         additional and supplementary provisions, including
                         without limitation, representations, warranties,
                         covenants, agreements and remedies, as are appropriate
                         to preserve and protect the economic benefits intended
                         to be conveyed to the Investor pursuant hereto and as
                         are customary for transactions of this type.

CERTAIN DEFINITIONS:

          (a)            "AVERAGE DAILY PRICE" shall be the price based on
                         the VWAP of the Company's Common Stock.

          (b)            "AVERAGE PRICE" shall be the average of the Average
                         Daily Price for the applicable Draw Down Pricing
                         Period.

          (c)            "DRAW DOWN PRICING PERIOD" shall mean a period of 22
                         consecutive trading days preceding a Draw Down
                         Exercise Date.


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<PAGE>

          (d)            "MATERIAL ADVERSE EFFECT" shall mean any effect on
                         the business, operations, properties or financial
                         condition of the Company that is material and adverse
                         to the Company and its subsidiaries and affiliates,
                         taken as a whole and/or any condition, circumstance or
                         situation that would prohibit or otherwise interfere
                         with the ability of the Company to enter into and
                         perform any of its obligations under the Purchase
                         Agreement or the Registration Rights Agreement in any
                         material respect.

          (e)            "MATERIAL CHANGE IN OWNERSHIP" shall mean that the
                         officers and directors of the Company shall own less
                         than ___% of the outstanding Common Stock of the
                         Company.

          (f)            "THRESHOLD PRICE" is the lowest price at which the
                         Company will issue new shares of Common Stock.

          (g)            "VWAP" shall mean the daily volume weighted average
                         price of the Company's Common Stock as reported by
                         Bloomberg Financial using the AQR function.

                                       3