EXHIBIT 3.4


                   NATIONAL MEDICAL HEALTH CARD SYSTEMS, INC.
                  AUDIT COMMITTEE AMENDED AND RESTATED CHARTER

     This Charter identifies the purpose, composition,  meeting requirements and
committee responsibilities of the Audit Committee (the "Committee") of the Board
of Directors (the "Board") of National  Medical  Health Card Systems,  Inc. (the
"Company").

Purpose

     The  Committee  has  been  established  to:  (a)  assist  the  Board in its
oversight   responsibilities  regarding  (1)  the  integrity  of  the  Company's
financial  statements,  (2) the Company's  compliance  with legal and regulatory
requirements and (3) the independent auditors'  qualifications and independence;
(b) prepare the report  required by the United  States  Securities  and Exchange
Commission  (the "SEC") for inclusion in the Company's  annual proxy  statement;
(c) retain and terminate the Company's independent  auditors;  (d) approve audit
and  non-audit  services to be performed by the  independent  auditors;  and (e)
perform  such other  functions  as the Board may from time to time assign to the
Committee.  In performing  its duties,  the Committee  shall seek to maintain an
effective  working  relationship  with the Board,  the independent  auditors and
management of the Company.

Membership and Meeting Requirements

     The Committee will be composed of not less than three members of the Board.
They will be selected by the Board,  taking into  account  prior  experience  in
matters  to be  considered  by the  Committee,  probable  availability  at times
required for consideration of such matters and their individual independence and
objectivity.

     The  members  of the  Committee  shall  (1) meet The  Nasdaq  Stock  Market
definition  of  independence  contained  in NASD  Marketplace  Rule  4200(a)(15)
(subject to the exception provided in NASD Marketplace Rule 4350(d)(2)(B)),  (2)
meet  the  requirements  of SEC  Rule  10A-3(b)(1)  (subject  to the  exceptions
provided in SEC Rule 10A-3(c)) and (3) meet the financial literacy  requirements
of NASD Marketplace Rule 4350(d)(2).  Accordingly,  all of the Committee members
will be directors independent of management and free from relationships that, in
the opinion of the Board and in conjunction with the "independence" standards of
The Nasdaq  Stock  Market,  would  interfere  with the  exercise of  independent
judgment  as a Committee  member.  All  Committee  members  must be  financially
literate.  In  addition,  at  least  one  member  shall be an  "audit  committee
financial expert."1 The Board shall review these requirements on an annual basis
to insure  continued  compliance by the members of the Committee with The Nasdaq
Stock Market and SEC rules and regulations.

     When considering  relationships that might affect  independence,  including
possible  affiliate status,  the Board will give appropriate  consideration,  in
addition to its Audit Committee policy, to guidelines issued by The Nasdaq Stock
Market,  which were  provided to assist  boards of directors  in  observing  the
spirit of The Nasdaq Stock Market policy.

     Except for Board and Committee fees, a member of the Committee shall not be
permitted  to accept any fees paid  directly  or  indirectly  for  services as a
consultant,  legal advisor or financial  advisor or any other fees prohibited by
the rules of the SEC and The Nasdaq Stock Market. In addition,  no member of the
Committee may be an affiliated person of the Company or any of its subsidiaries.
Members of the Committee  may receive  their Board and  Committee  fees in cash,
Company  stock or options or other  in-kind  consideration  as determined by the
Board or the  Compensation  Committee,  as applicable,  in addition to all other
benefits that other directors of the Company receive.

     The Committee  shall meet at least four times a year, or more frequently as
circumstances  require. The Committee may ask members of management or others to
attend meetings and provide pertinent information as necessary.

     Nothing  contained  in this  charter is intended to, or should be construed
as,  creating any  responsibility  or liability of the members of the  Committee
except to the extent  otherwise  provided  under the  Delaware  law which  shall
continue  to set the  legal  standard  for the  conduct  of the  members  of the
Committee.

Actions of the Committee

     The Committee's  activities  will include,  but will not be limited to, the
following actions:

     o    Oversight  of  the  financial   statements   and  relations  with  the
          independent auditors:

          o    Be directly  responsible  for, and have sole authority as to, the
               appointment,   retention  and   termination,   compensation   and
               oversight  of the  work of the  independent  auditors,  including
               resolution of disagreements  between  management and the auditors
               regarding accounting matters and financial reporting matters.

          o    Evaluate the independent  auditors'  qualifications,  performance
               and independence.  To assist this  undertaking,  the Committee is
               responsible   for  ensuring  its  receipt  of  a  formal  written
               statement   from  the   independent   auditor   delineating   all
               relationships  between the auditor  and the  Company,  consistent
               with Independence Standards Board Standard 1.

          o    Ensure the regular  rotation of the lead audit  partner and audit
               review partner as required by law.

          o    Maintain  procedures for the receipt,  retention and treatment of
               complaints, concerns and anonymous submissions from employees and
               others  regarding  accounting,  internal  accounting  controls or
               auditing matters and questionable accounting or auditing matters.

          o    Require that the Board engage the independent auditors to perform
               quarterly reviews of the Company's financial statements.

          o    Instruct the independent auditors that the Board is the client in
               its capacity as the shareholders' representative.

          o    Expect the  independent  auditors to meet with the Board at least
               annually  so the  Board  has a basis on which  to  recommend  the
               independent  auditors'  appointment  to  the  shareholders  or to
               ratify its selection of the independent auditors.

          o    Expect  financial  management  and the  independent  auditors  to
               analyze significant financial reporting issues and practices on a
               timely basis.

          o    Expect  financial  management  and the  independent  auditors  to
               discuss with the Committee:

               -    Qualitative  judgments  about  whether  current or  proposed
                    accounting  principles and disclosures are appropriate,  not
                    just acceptable.

               -    Aggressiveness or conservatism of accounting  principles and
                    financial estimates.

          o    Expect the independent auditors to provide the Committee with:

               -    Independent  judgments  about  the  appropriateness  of  the
                    Company's  current or  proposed  accounting  principles  and
                    whether current or proposed financial disclosures are clear.

               -    Views  on  whether  the  accounting   principles  chosen  by
                    management are conservative, moderate, or aggressive as they
                    relate to income,  asset,  and  liability  recognition,  and
                    whether  these  accounting  principles  are commonly used by
                    other similarly situated companies.

               -    Reasons why accounting  principles and disclosure  practices
                    used for new transactions or events are appropriate.

               -    Reasons for accepting or questioning  significant  estimates
                    made by management.

               -    Views on how selected  accounting  principles and disclosure
                    practices  affect  shareholder and public attitude about the
                    Company.

          o    The Committee shall have the authority and sufficient  funding to
               retain special legal,  accounting or other  consultants to advise
               the Committee as it deems appropriate.

          o    The Company shall provide  appropriate  funding, as determined by
               the  Committee,   for  compensation  to  any  registered   public
               accounting  firm  engaged for the purpose of preparing or issuing
               an audit  report  or  performing  other  audit,  review or attest
               services  for the  Company  and to any  advisors  employed by the
               Committee. The Company shall also provide appropriate funding, as
               determined  by  the  Committee,   for  payment  of  its  ordinary
               administrative  expenses  that are  necessary or  appropriate  in
               carrying out its duties.

     o Actions taken on the Board's behalf that require Board notification,  but
       not Board approval:

          o    Consider,  through  consultation with the independent auditor and
               financial management, the audit scope and plan of the independent
               auditor and the internal auditors.

          o    Review and approve the scope of the  independent  auditor's audit
               of the Company.

          o    Review and approve the scope of the internal  auditor's  audit of
               the Company.

          o    Review and approve the scope of the  Company's  annual profit and
               pension trust audits,  to the extent the Company has  established
               profit and pension trusts.

          o    Answer  questions   raised  by  shareholders   during  an  annual
               shareholder's  meeting on  matters  relating  to the  Committee's
               activities if asked to do so by the Chairman of the Board.

          o    Ask the  Chief  Executive  Officer  of the  Company  to have  the
               internal  audit  staff  study a  particular  area of  interest or
               concern to the Committee.

     o    Matters  requiring  the  Committee's  review and study before making a
          recommendation for the Board action:

          o    Implementation of major accounting policy changes.

          o    SEC registration statements to be signed by the Board.

          o    Interim financial  statements and year end financial  statements,
               and the accompanying  auditor's  reports,  prior to the filing of
               the Company's Quarterly Reports on Form 10-Q and Annual Report on
               Form 10-K (or the annual report to  shareholders  if  distributed
               prior to the filing of the Form 10-K) as applicable.

     o    Matters  requiring the Committee's  review and study before  providing
          summary information to the Board:

          o    Annual review and reassessment of the Committee charter.

          o    Accounting  policy changes  proposed or adopted by  organizations
               such as the Financial  Accounting  Standards  Board, the SEC, and
               the American  Institute of Certified  Public  Accountings,  or by
               comparable bodies outside the U.S.

          o    The  independent   auditors'  assessment  of  the  strengths  and
               weaknesses of the Company's  financial staff,  systems,  controls
               and other  factors that might be relevant to the integrity of the
               financial statements.

          o    Quarterly financial statement review before publication.

          o    The  performance of management and operating  personnel under any
               code of ethics which may be established by the Company.

          o    Gaps and exposures in insurance programs.

          o    Reports  about  the  Company  or its  subsidiaries  submitted  by
               agencies of  governments in countries in which the Company or its
               subsidiaries operate.

          o    Periodic SEC filings and the adequacy of programs and  procedures
               to assure  compliance with SEC regulations and regulations of The
               Nasdaq Stock Market.

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     1 An audit committee  financial  expert, as defined in the NASD Marketplace
Rule  4350(d)(2)(A)(i),  must have past  employment  experience  in  finance  or
accounting,  requisite  profession  certification  in  accounting,  or any other
comparable experience or background which results in the individual's  financial
sophistication., including being or having been a chief executive officer, chief
financial   officer  or  other   senior   officer   with   financial   oversight
responsibilities.