EXHIBIT B
                                                                   to Securities
                                                                        Purchase
                                                                       Agreement

                  VOID  AFTER 5:00  P.M.,  NEW YORK CITY TIME,  ON THE
                  FIFTH ANNIVERSARY OF ISSUANCE

                  THIS WARRANT AND THE SHARES  ISSUABLE  UPON EXERCISE
                  OF THIS WARRANT HAVE NOT BEEN  REGISTERED  UNDER THE
                  SECURITIES ACT OF 1933, AS AMENDED (THE  "SECURITIES
                  ACT"),  OR THE  SECURITIES  LAWS OF ANY STATE OF THE
                  UNITED  STATES  OR  ANY  OTHER   JURISDICTION.   THE
                  SECURITIES  REPRESENTED HEREBY MAY NOT BE OFFERED OR
                  SOLD IN THE  ABSENCE  OF AN  EFFECTIVE  REGISTRATION
                  STATEMENT  FOR  THE  SECURITIES   UNDER   APPLICABLE
                  SECURITIES LAWS UNLESS OFFERED,  SOLD OR TRANSFERRED
                  PURSUANT  TO  AN   AVAILABLE   EXEMPTION   FROM  THE
                  REGISTRATION REQUIREMENTS OF THOSE LAWS.

                                         Right to Purchase _________ Shares of
                                         Common Stock, par value $.001 per share

Date: July 25, 2000

                  LUMENON INNOVATIVE LIGHTWAVE TECHNOLOGY, INC.
                             STOCK PURCHASE WARRANT

            THIS CERTIFIES THAT, for value  received,  ________________________,
or its  registered  assigns,  is entitled to purchase  from  LUMENON  INNOVATIVE
LIGHTWAVE TECHNOLOGY,  INC., a corporation organized under the laws of the State
of Delaware (the "Company"),  at any time or from time to time during the period
specified in Section 2 hereof,  ________________________  (_________) fully paid
and  nonassessable  shares of the Company's  common  stock,  par value $.001 per
share (the  "Common  Stock"),  at an  exercise  price per share  (the  "Exercise
Price")  calculated as follows:  in the event the Volume Weighted  Average Price
(as defined  below) for the Common Stock for the five  consecutive  trading days
immediately  preceding  the Vesting Date (as defined in Section 2 below) is less
than or equal to $30.00  (subject to  equitable  adjustments  for stock  splits,
stock dividends,  recapitalization  and similar events prior to the Vesting Date
(collectively,  "Equitable Adjustments")), then the initial Exercise Price shall
be $10.00  (subject  to  Equitable  Adjustments);  and in the  event the  Volume
Weighted  Average  Price for the Common Stock for the five  consecutive  trading
days immediately preceding the Vesting Date exceeds $30.00 (subject to Equitable
Adjustments),  but is less than $70.00 (subject to Equitable Adjustments),  then
the initial  Exercise Price shall be equal to the sum of (i) $10.00  (subject to
Equitable  Adjustments)  and (ii) the



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product  of (A) the amount by which the Volume  Weighted  Average  Price for the
Common Stock for the five  consecutive  trading days  immediately  preceding the
Vesting Date exceeds $30.00 (subject to Equitable  Adjustments) and (B) 0.5; and
in the event that the Volume Weighted Average Price for the Common Stock for the
five  consecutive  trading days  immediately  preceding the Vesting Date exceeds
$70.00 (subject to Equitable  Adjustments),  the initial Exercise Price shall be
$30.00 (subject to Equitable Adjustments);  provided, however, in no event shall
the initial  Exercise Price exceed the  consideration  per share (which shall be
determined in accordance  with the  provisions of Section 4(b) hereof) for which
the Company shall issue shares of Common Stock in connection  with the Company's
then most recent  equity  financing  of at least  $5,000,000  (other than a firm
commitment  underwritten  public  offering of  securities  registered  under the
Securities  Act of 1933).  The  number of  shares  of Common  Stock  purchasable
hereunder  (the  "Warrant  Shares")  and  the  Exercise  Price  are  subject  to
adjustment as provided in Section 4 hereof.  The term "Volume  Weighted  Average
Price" means the Volume  Weighted  Average Price for any security as of any date
as reported by Bloomberg Financial Markets (or a comparable reporting service of
national reputation selected by the Corporation and reasonably acceptable to the
Purchasers (as defined in that certain Securities Purchase  Agreement,  dated as
of July 25, 2000, by and among the Company and the other signatory  thereto (the
"Securities  Purchase  Agreement"))  holding a majority  of the  Warrant  Shares
(assuming full exercise of all of the Warrants (as defined below) without regard
to any limitations on exercise  contained  herein or in the Securities  Purchase
Agreement)  ("Majority  Holders")  if  Bloomberg  Financial  Markets is not then
reporting  Volume  Weighted  Average  Prices  of such  security)  (collectively,
"Bloomberg"),  or if the foregoing does not apply,  the last reported sale price
of such security in the over-the-counter market on the electronic bulletin board
for such security as reported by Bloomberg, or, if no sale price is reported for
such security by  Bloomberg,  the average of the bid prices of all market makers
for such  security as reported in the "pink  sheets" by the  National  Quotation
Bureau, Inc., in each case for such date or, if such date was not a trading date
for such  security,  on the next preceding date which was a trading date. If the
Volume  Weighted  Average  Price cannot be  calculated  for such  security as of
either of such dates on any of the foregoing  bases, the Volume Weighted Average
Price of such security on such date shall be the fair market value as reasonably
determined by an investment  banking firm selected by the Company and reasonably
acceptable to the Majority Holders, with the costs of such appraisal to be borne
by the Company. The term "Warrants" means this Warrant and the other warrants of
the  Company  issued  pursuant  to  this  Securities  Purchase  Agreement.   All
references herein to monetary  denominations  shall refer to lawful money of the
United States of America.

            This  Warrant is  subject to the  following  terms,  provisions  and
conditions:

            1. Manner of Exercise; Issuance of Certificates; Payment for Shares.
Subject to the provisions hereof, including, without limitation, the limitations
contained  in Section 7 hereof,  this  Warrant  may be  exercised  by the holder
hereof,  in whole or in part, by the surrender of this Warrant,  together with a
completed  exercise  agreement  in  the  form  attached  hereto  (the  "Exercise
Agreement"),  to the Company by 11:59 p.m.  New York time on any business day at
the Company's principal executive offices (or such other office or agency of the
Company as it may designate by notice to the holder hereof) and upon (i) payment
to the Company in cash,  by certified or

                                      -2-

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official bank check or by wire  transfer for the account of the Company,  of the
Exercise  Price for the Warrant  Shares  specified in the Exercise  Agreement or
(ii) if the holder is  permitted  to effect a Cashless  Exercise  (as defined in
Section 12(c) below)  pursuant to Section 12(c) hereof,  delivery to the Company
of a written notice of an election to effect a Cashless Exercise for the Warrant
Shares  specified in the  Exercise  Agreement.  The Warrant  Shares so purchased
shall be deemed to be issued to the holder hereof or such holder's designee,  as
the record  owner of such  shares,  as of the close of  business  on the date on
which  this  Warrant  shall have been  surrendered  and the  completed  Exercise
Agreement  shall have been  delivered  and payment shall have been made for such
shares as set forth  above or, if such day is not a  business  day,  on the next
succeeding  business  day. The Warrant  Shares so  purchased,  representing  the
aggregate  number  of  shares  specified  in the  Exercise  Agreement,  shall be
delivered to the holder  hereof  within a reasonable  time,  not  exceeding  two
business  days,  after this Warrant shall have been so exercised  (the "Delivery
Period").  If the Company's  transfer agent is  participating  in the Depository
Trust Company ("DTC") Fast Automated Securities Transfer program, and so long as
the  certificates  therefor do not bear a legend and the holder is not obligated
to return such  certificate for the placement of a legend  thereon,  the Company
shall cause its transfer agent to electronically  transmit the Warrant Shares so
purchased  to the holder by  crediting  the account of the holder or its nominee
with  DTC  through  its  Deposit   Withdrawal  Agent  Commission   system  ("DTC
Transfer").  If  the  aforementioned  conditions  to  a  DTC  Transfer  are  not
satisfied,  the  Company  shall  deliver  to the  holder  physical  certificates
representing the Warrant Shares so purchased.  Further,  the holder may instruct
the  Company to deliver to the holder  physical  certificates  representing  the
Warrant  Shares so  purchased  in lieu of  delivering  such shares by way of DTC
Transfer. Any certificates so delivered shall be in such denominations as may be
requested by the holder  hereof,  shall be registered in the name of such holder
or such other name as shall be designated by such holder and, following the date
on which the  Warrant  Shares  have been  registered  under the  Securities  Act
pursuant to that certain  Registration  Rights  Agreement,  dated as of July 25,
2000,  by  and  between  the  Company  and  the  other  signatory  thereto  (the
"Registration Rights Agreement") or otherwise may be sold by the holder pursuant
to Rule 144 promulgated  under the Securities Act (or a successor  rule),  shall
not bear any restrictive  legend. If this Warrant shall have been exercised only
in part, then the Company shall, at its expense, at the time of delivery of such
certificates,  deliver to the holder a new  Warrant  representing  the number of
shares with respect to which this Warrant shall not then have been exercised.

            If, at any time, a holder of this Warrant  submits this Warrant,  an
Exercise  Agreement and payment to the Company of the Exercise Price for each of
the Warrant Shares  specified in the Exercise  Agreement,  and the Company fails
for any reason to deliver,  on or prior to the fifth  business day following the
expiration  of the Delivery  Period for such  exercise,  the number of shares of
Common Stock to which the holder is entitled  upon such  exercise (an  "Exercise
Default"),  then the Company shall pay to the holder payments ("Exercise Default
Payments") for an Exercise  Default in the amount of (a) (N/365),  multiplied by
(b) the amount by which the Market  Price (as defined in Section  4(l) below) on
the  date  the  Exercise  Agreement  giving  rise  to the  Exercise  Default  is
transmitted  in accordance  with this Section 1 (the  "Exercise  Default  Date")
exceeds the Exercise Price in respect of such Warrant Shares,  multiplied by (c)
the number of shares of Common  Stock the  Company  failed to so deliver in such
Exercise  Default,  multiplied by (d) .24, where N =

                                      -3-

<PAGE>

the number of days from the  Exercise  Default Date to the date that the Company
effects  the full  exercise  of this  Warrant  which  gave rise to the  Exercise
Default.  The accrued  Exercise Default Payment for each calendar month shall be
paid in cash not later  than the fifth day of the month  following  the month in
which it has accrued.

                  Nothing herein shall limit the holder's right to pursue actual
damages for the Company's  failure to maintain a sufficient number of authorized
shares of Common Stock as required  pursuant to the terms of Section 3(b) hereof
or to otherwise  issue  shares of Common Stock upon  exercise of this Warrant in
accordance with the terms hereof,  and the holder shall have the right to pursue
all  remedies  available  at law or in equity  (including  a decree of  specific
performance and/or injunctive relief).

            2. Period of Exercise. This Warrant is immediately  exercisable,  at
any time or from time to time on or after  January 25, 2002 of this  Warrant (as
such date may be accelerated  pursuant to the Notes and the Registration  Rights
Agreement, the "Vesting Date") and before 5:00 p.m., New York City time, on July
25, 2005 (the "Exercise Period").

            3. Certain  Agreements of the Company.  The Company hereby covenants
and agrees as follows:

               (a)  Shares to be Fully  Paid.  All  Warrant  Shares  will,  upon
issuance in accordance with the terms of this Warrant, be validly issued,  fully
paid, and nonassessable and free from all taxes, liens, claims and encumbrances.

               (b)  Reservation  of Shares.  During  the  Exercise  Period,  the
Company  shall at all times have  authorized,  and  reserved  for the purpose of
issuance upon exercise of this Warrant,  a sufficient number of shares of Common
Stock to provide for the exercise in full of this Warrant (without giving effect
to the limitations on exercise set forth in Section 7(g) hereof).

               (c) Listing. The Company shall promptly secure the listing of the
shares of Common Stock issuable upon exercise of this Warrant upon each national
securities  exchange or automated quotation system, if any, upon which shares of
Common  Stock are then listed or become  listed  (subject to official  notice of
issuance upon exercise of this Warrant) and shall maintain, so long as any other
shares of Common Stock shall be so listed,  such listing of all shares of Common
Stock from time to time  issuable  upon the  exercise of this  Warrant;  and the
Company  shall  so  list on  each  national  securities  exchange  or  automated
quotation  system,  as the case may be, and shall  maintain such listing of, any
other shares of capital stock of the Company  issuable upon the exercise of this
Warrant if and so long as any  shares of the same class  shall be listed on such
national securities exchange or automated quotation system.

               (d)  Certain  Actions  Prohibited.   The  Company  will  not,  by
amendment  of its  charter or through  any  reorganization,  transfer of assets,
consolidation,  merger,  dissolution,  issue or sale of securities, or any other
voluntary action, avoid or seek to avoid the observance or
                                      -4-


<PAGE>
performance of any of the terms to be observed or performed by it hereunder, but
will at all times in good faith assist in the carrying out of all the provisions
of this  Warrant  and in the  taking  of all such  action as may  reasonably  be
requested by the holder of this Warrant in order to protect the economic benefit
inuring to the holder hereof and the exercise privilege of the holder of this

Warrant  against  dilution or other  impairment,  consistent  with the tenor and
purpose of this Warrant.  Without limiting the generality of the foregoing,  the
Company  (i) will not  increase  the par value of any  shares  of  Common  Stock
receivable  upon the exercise of this Warrant  above the lowest  Exercise  Price
then in  effect,  and (ii) will take all such  actions  as may be  necessary  or
appropriate  in order that the Company may validly and legally  issue fully paid
and nonassessable shares of Common Stock upon the exercise of this Warrant.

               (e) Successors and Assigns. This Warrant will be binding upon any
entity succeeding to the Company by merger, consolidation, or acquisition of all
or substantially all of the Company's assets.

               (f) Blue Sky Laws.  The Company  shall,  on or before the date of
issuance  of  any  Warrant  Shares,  take  such  actions  as the  Company  shall
reasonably  determine are necessary to qualify the Warrant Shares for, or obtain
exemption  for the Warrant  Shares for,  sale to the holder of this Warrant upon
the exercise hereof under applicable securities or "blue sky" laws of the states
of the United States,  and shall provide evidence of any such action so taken to
the holder of this  Warrant  prior to such  date;  provided,  however,  that the
Company shall not be required in connection  therewith or as a condition thereto
to (a) qualify to do business in any  jurisdiction  where it would not otherwise
be required to qualify but for this Section 3(f),  (b) subject itself to general
taxation  in any such  jurisdiction,  (c) file a general  consent  to service of
process in any such  jurisdiction,  (d) provide any undertakings  that cause the
Company  undue  expense  or  burden,  or (e) make any  change in its  charter or
bylaws,  which in each case the Board of Directors of the Company  determines to
be contrary to the best interests of the Company and its stockholders.

            4. Antidilution Provisions. During the Exercise Period, the Exercise
Price and the number of Warrant Shares  issuable  hereunder  shall be subject to
adjustment from time to time as provided in this Section 4.

               In the event that any  adjustment  of the  Exercise  Price(s)  as
required herein results in a fraction of a cent, such Exercise Price(s) shall be
rounded up or down to the nearest cent.

               (a) Adjustment of Exercise Price(s). Except as otherwise provided
in Sections 4(c) and 4(e) hereof, if and whenever during the Exercise Period the
Company issues or sells,  or in accordance with Section 4(b) hereof is deemed to
have issued or sold,  any shares of Common Stock for no  consideration  or for a
consideration  per share less than the Market Price on the Measurement  Date (as
such terms are  hereinafter  defined) (a "Dilutive  Issuance"),  then  effective
immediately upon the Dilutive  Issuance,  the Exercise Price(s) will be adjusted
in accordance with the following formula:

                                      -5-

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                        E'   =   E    x           O + P/M
                                            -------------
                                                    CSDO

                        where:

                       E'   =   the adjusted Exercise Price;
                       E    =   the Exercise Price on the Measurement Date;
                       M    =   the Market Price on the Measurement Date;
                       O    =   the number of shares of Common
                                Stock outstanding immediately prior to the
                                Dilutive Issuance;
                       P    =   the aggregate consideration,
                                calculated as set forth in Section 4(b)
                                hereof, received by the Company upon such
                                Dilutive Issuance; and
                       CSDO =   the total  number of shares of
                                Common Stock Deemed Outstanding (as defined
                                in Section 4(l)(i) below) immediately after
                                the Dilutive Issuance.

Notwithstanding  the  foregoing,  no  adjustment  shall be made pursuant to this
Section  4(a) if such  adjustment  would  result in an increase in the  Exercise
Price.

               (b) Effect on Exercise  Price(s) of Certain Events.  For purposes
of determining  the adjusted  Exercise  Price(s) under Section 4(a) hereof,  the
following will be applicable:

                   (i)  Issuance  of Rights or  Options.  If the  Company in any
manner  issues  or  grants  any  warrants,  rights or  options,  whether  or not
immediately  exercisable,  to subscribe for or to purchase Common Stock or other
securities  exercisable,  convertible  into or  exchangeable  for  Common  Stock
("Convertible Securities") (such warrants, rights and options to purchase Common
Stock or Convertible  Securities are  hereinafter  referred to as "Options") and
the price per share for which Common Stock is issuable upon the exercise of such
Options is less than the Market Price in effect on the Measurement  Date ("Below
Market  Options"),  then the  maximum  total  number of  shares of Common  Stock
issuable  upon the  exercise of all such Below  Market  Options  (assuming  full
exercise, conversion or exchange of Convertible Securities, if applicable) will,
as of the date of the issuance or grant of such Below Market Options,  be deemed
to be outstanding and to have been issued and sold by the Company for such price
per share.  For  purposes of the  preceding  sentence,  the "price per share for
which Common Stock is issuable  upon the exercise of such Below Market  Options"
is determined by dividing (i) the total amount,  if any,  received or receivable
by the Company as  consideration  for the issuance or granting of all such Below
Market Options,  plus the minimum aggregate amount of additional  consideration,
if any,  payable to the  Company  upon the  exercise  of all such  Below  Market
Options,  plus, in the case of Convertible Securities issuable upon the exercise
of such  Below  Market  Options,  the  minimum  aggregate  amount of  additional
consideration  payable upon the exercise,  conversion or exchange thereof at the
time such  Convertible  Securities  first  become  exercisable,  convertible  or
exchangeable,  by (ii) the  maximum  total  number of  shares  of  Common  Stock
issuable  upon the  exercise of all such Below  Market  Options  (assuming  full
conversion of Convertible Securities,  if applicable).  No further adjustment to
the Exercise

                                      -6-

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Price(s)  will be made upon the actual  issuance of such  Common  Stock upon the
exercise  of such Below  Market  Options  or upon the  exercise,  conversion  or
exchange of Convertible  Securities  issuable upon exercise of such Below Market
Options.  If, in any case,  the total number of shares of Common Stock  issuable
upon  exercise  of any Below  Market  Options or upon  exercise,  conversion  or
exchange of any Convertible Securities is not, in fact, issued and the rights to
exercise  such  option or to  exercise,  convert or  exchange  such  Convertible
Securities  shall have expired or terminated,  the Exercise Price then in effect
will be readjusted to the Exercise  Price which would have been in effect at the
time of such  expiration  or  termination  had  such  Below  Market  Options  or
Convertible  Securities,  to the extent  outstanding  immediately  prior to such
expiration or termination  (other than in respect of the actual number of shares
of Common Stock issued upon exercise or conversion thereof), never been issued.

                   (ii) Issuance of Convertible Securities.

                        (A) If the  Company  in any  manner  issues or sells any
Convertible Securities, whether or not immediately convertible (other than where
the same are issuable  upon the exercise of Options) and the price per share for
which Common Stock is issuable  upon such  exercise,  conversion or exchange (as
determined  pursuant  to Section  4(b)(ii)(B)  if  applicable)  is less than the
Market Price in effect on the Measurement Date, then the maximum total number of
shares of Common Stock issuable upon the exercise, conversion or exchange of all
such  Convertible  Securities  will,  as of the  date  of the  issuance  of such
Convertible Securities,  be deemed to be outstanding and to have been issued and
sold by the Company for such price per share.  For the purposes of the preceding
sentence,  the "price per share for which  Common  Stock is  issuable  upon such
exercise,  conversion  or  exchange"  is  determined  by dividing  (i) the total
amount,  if any,  received or receivable by the Company as consideration for the
issuance or sale of all such  Convertible  Securities  (taking  into account the
value of any  warrants  or other  securities  issued to the  purchasers  of such
Convertible  Securities),  plus  the  minimum  aggregate  amount  of  additional
consideration,  if any, payable to the Company upon the exercise,  conversion or
exchange  thereof  at  the  time  such   Convertible   Securities  first  become
exercisable,  convertible or  exchangeable,  by (ii) the maximum total number of
shares of Common Stock issuable upon the exercise, conversion or exchange of all
such Convertible Securities. No further adjustment to the Exercise Price(s) will
be made upon the actual issuance of such Common Stock upon exercise,  conversion
or exchange of such Convertible Securities.

                        (B) If the  Company  in any  manner  issues or sells any
Convertible  Securities  with a  fluctuating  conversion  or  exercise  price or
exchange ratio (a "Variable  Rate  Convertible  Security"),  then the "price per
share for which  Common  Stock is issuable  upon such  exercise,  conversion  or
exchange" for purposes of the calculation  contemplated  by Section  4(b)(ii)(A)
shall be deemed to be the  lowest  price per  share  which  would be  applicable
(assuming all holding period and other conditions to any discounts  contained in
such  Convertible  Security  have been  satisfied)  if the  Market  Price on the
Measurement Date was 75% of the Market Price on such date (the "Assumed Variable
Market Price").  Further, if the Market Price at any time or times thereafter is
less than or equal to the Assumed Variable Market Price last used for making any
adjustment  under this Section 4 with respect to any Variable  Rate  Convertible
Security,  the Exercise

                                      -7-

<PAGE>
Price(s)  in effect  at such  time  shall be  readjusted  to equal the  Exercise
Price(s) which would have resulted if the Assumed  Variable  Market Price at the
time of issuance of the Variable Rate  Convertible  Security had been 75% of the
Market Price existing at the time of the adjustment required by this sentence.

                   (iii) Change in Option Price or Conversion  Rate. If there is
a change at any time in (i) the amount of  additional  consideration  payable to
the Company  upon the  exercise of any  Options;  (ii) the amount of  additional
consideration,  if any, payable to the Company upon the exercise,  conversion or
exchange  of any  Convertible  Securities;  or  (iii)  the  rate  at  which  any
Convertible Securities are convertible into or exchangeable for Common Stock (in
each such case, other than under or by reason of provisions  designed to protect
against  dilution),  the Exercise  Price(s) in effect at the time of such change
will be readjusted to the Exercise  Price(s)  which would have been in effect at
such time had such Options or Convertible  Securities still outstanding provided
for such changed  additional  consideration  or changed  conversion rate, as the
case may be, at the time initially granted, issued or sold.

                   (iv)  Calculation of  Consideration  Received.  If any Common
Stock, Options or Convertible  Securities are issued,  granted or sold for cash,
the  consideration  received  therefor  for purposes of this Warrant will be the
amount  received  by  the  Company  therefor,  before  deduction  of  reasonable
commissions,  underwriting  discounts or allowances or other reasonable expenses
paid or incurred by the Company in connection with such issuance, grant or sale.
In case any Common Stock,  Options or Convertible  Securities are issued or sold
for a consideration part or all of which shall be other than cash, including, in
the case of a strategic  or similar  arrangement  in which the other entity will
provide services to the Company, purchase services from the Company or otherwise
provide intangible consideration to the Company, the amount of the consideration
other than cash received by the Company  (including the net present value of the
contribution  expected by the Company for the  provided or  purchased  services)
will  be the  fair  market  value  of  such  consideration,  except  where  such
consideration consists of securities,  in which case the amount of consideration
received  by the  Company  will be the  Market  Price  thereof as of the date of
receipt. In case any Common Stock, Options or Convertible  Securities are issued
in  connection  with any  merger or  consolidation  in which the  Company is the
surviving corporation, the amount of consideration therefor will be deemed to be
the fair  market  value of such  portion of the net assets and  business  of the
non-surviving  corporation as is attributable  to such Common Stock,  Options or
Convertible Securities,  as the case may be. The Company shall calculate,  using
standard  commercial  valuation methods appropriate for valuing such assets, the
fair market value of any consideration other than cash or securities;  provided,
however,  that if the holder  hereof  does not agree to such fair  market  value
calculation  within three business days after receipt  thereof from the Company,
then such fair market value will be  determined  in good faith by an  investment
banker  or other  appropriate  expert of  national  reputation  selected  by the
Company and reasonably  acceptable to the holder hereof,  with the costs of such
appraisal to be borne by the Company.

                   (v)  Exceptions  to  Adjustment  of  Exercise  Price(s).   No
adjustment  to the Exercise  Price(s)  will be made (i) upon the exercise of any
warrants,  options or convertible  securities


                                      -8-


<PAGE>
issued and  outstanding  on July 25, 2000 and set forth on Schedule  3(d) of the
Securities Purchase Agreement in accordance with the terms of such securities as
of such date;  (ii) upon the grant or exercise of any stock or options which may
hereafter be granted or exercised under any employee benefit plan of the Company
now existing or to be implemented in the future, so long as the issuance of such
stock or options is approved by a majority  of the  non-employee  members of the
Board of Directors of the Company or a majority of the members of a committee of
non-employee  directors established for such purpose; (iii) upon the issuance of
any Notes or Warrants in accordance  with the terms of the  Securities  Purchase
Agreement; or (iv) upon conversion of the Notes or exercise of the Warrants.

               (c)  Subdivision or Combination of Common Stock.  If the Company,
at any time during the Exercise  Period,  subdivides (by any stock split,  stock
dividend, recapitalization,  reorganization,  reclassification or otherwise) its
shares of Common Stock into a greater number of shares,  then, after the date of
record  for  effecting  such  subdivision,   the  Exercise  Price(s)  in  effect
immediately prior to such subdivision will be  proportionately  reduced.  If the
Company,  at any time during the Exercise  Period,  combines  (by reverse  stock
split,  recapitalization,  reorganization,  reclassification  or otherwise)  its
shares of Common Stock into a smaller number of shares,  then, after the date of
record  for  effecting  such  combination,   the  Exercise  Price(s)  in  effect
immediately prior to such combination will be proportionately increased.

               (d) Adjustment in Number of Shares.  Upon each  adjustment of the
Exercise  Price(s)  pursuant to the  provisions of Section  4(c),  the number of
shares of Common  Stock  issuable  upon  exercise  of this  Warrant at each such
Exercise  Price shall be adjusted by  multiplying a number equal to the Exercise
Price in effect  immediately prior to such adjustment by the number of shares of
Common  Stock  issuable  upon  exercise of this Warrant at such  Exercise  Price
immediately prior to such adjustment and dividing the product so obtained by the
adjusted Exercise Price.

               (e)  Consolidation,  Merger or Sale. In case of any consolidation
of the Company with, or merger of the Company into, any other corporation, or in
case of any sale or conveyance of all or substantially  all of the assets of the
Company  other than in  connection  with a plan of complete  liquidation  of the
Company at any time during the  Exercise  Period,  then as a  condition  of such
consolidation,  merger or sale or  conveyance,  adequate  provision will be made
whereby  the holder of this  Warrant  will have the right to acquire and receive
upon exercise of this Warrant in lieu of the shares of Common Stock  immediately
theretofore  acquirable upon the exercise of this Warrant, such shares of stock,
securities,  cash or assets as may be issued or  payable  with  respect to or in
exchange  for the  number  of shares of  Common  Stock  immediately  theretofore
acquirable and receivable upon exercise of this Warrant had such  consolidation,
merger or sale or conveyance not taken place. In any such case, the Company will
make  appropriate  provision  to insure that the  provisions  of this  Section 4
hereof  will  thereafter  be  applicable  as nearly as may be in relation to any
shares of stock or securities  thereafter  deliverable upon the exercise of this
Warrant.  The  Company  will not  effect  any  consolidation,  merger or sale or
conveyance unless prior to the consummation  thereof, the successor  corporation
(if other than the Company) assumes by written  instrument the obligations under
this Warrant and the  obligations  to deliver to the holder of this Warrant such
shares of stock,


                                      -9-

<PAGE>
securities or assets as, in accordance with the foregoing provisions, the holder
may be entitled to acquire.  Notwithstanding the foregoing,  in the event of any
consolidation  of the Company  with,  or merger of the Company  into,  any other
corporation, or the sale or conveyance of all or substantially all of the assets
of the  Company,  at any time  during  the  Exercise  Period,  the holder of the
Warrant shall, at its option, have the right to receive, in connection with such
transaction,  cash  consideration  equal to the fair  value of this  Warrant  as
determined  in  accordance  with  customary  valuation  methodology  used in the
investment banking industry.

               (f) Distribution of Assets.  In case the Company shall declare or
make any distribution of its assets (or rights to acquire its assets) to holders
of Common Stock as a partial liquidating dividend,  stock repurchase,  by way of
return of capital or otherwise  (including any dividend or  distribution  to the
Company's  shareholders  of cash or shares  (or  rights to  acquire  shares)  of
capital  stock of a  subsidiary)  (a  "Distribution"),  at any time  during  the
Exercise Period, then the holder of this Warrant shall be entitled upon exercise
of this  Warrant for the  purchase  of any or all of the shares of Common  Stock
subject  hereto,  to receive the amount of such  assets (or rights)  which would
have been  payable to the holder had such  holder been the holder of such shares
of  Common  Stock on the  record  date  for the  determination  of  shareholders
entitled to such  Distribution.  If the Company  distributes  rights,  warrants,
options or any other form of convertible securities and the right to exercise or
convert such  securities  would expire in accordance with its terms prior to the
exercise of the Warrants,  then the terms of such securities  shall provide that
such exercise or convertibility right shall remain in effect until 30 days after
the date the holders of the  Warrants  receive such  securities  pursuant to the
exercise hereof.

               (g) Notice of Adjustment.  Upon the occurrence of any event which
requires any adjustment of the Exercise  Price(s),  then, and in each such case,
the  Company  shall give  notice  thereof to the holder of this  Warrant,  which
notice shall state the Exercise Price(s)  resulting from such adjustment and the
increase or decrease in the number of Warrant  Shares  purchasable  at each such
price  upon  exercise,   setting  forth  in  reasonable  detail  the  method  of
calculation and the facts upon which such calculation is based. Such calculation
shall be certified by the chief financial officer of the Company.

               (h) Minimum  Adjustment of Exercise  Price.  No adjustment of the
Exercise Price shall be made in an amount of less than $.01, but any such lesser
adjustment  shall be carried  forward and shall be made at the time and together
with the next  subsequent  adjustment  which,  together with any  adjustments so
carried forward, shall amount to not less than $.01.

               (i) No Fractional  Shares.  No fractional  shares of Common Stock
are to be issued upon the exercise of this Warrant,  but the Company shall pay a
cash  adjustment  in respect of any  fractional  share which would  otherwise be
issuable in an amount equal to the same  fraction of the Market Price of a share
of Common Stock on the date of such exercise.

                                      -10-

<PAGE>

               (j) Other Notices. In case at any time:

                   (i) the Company  shall  declare any dividend  upon the Common
Stock  payable  in shares  of stock of any class or make any other  distribution
(other than dividends or distributions  payable in cash out of retained earnings
consistent with the Company's past practices with respect to declaring dividends
and making distributions) to the holders of the Common Stock;

                   (ii) the Company shall offer for subscription pro rata to the
holders of the Common Stock any additional shares of stock of any class or other
rights;

                   (iii)  there  shall  be  any  capital  reorganization  of the
Company,  or reclassification of the Common Stock, or consolidation or merger of
the Company with or into, or sale of all or substantially  all of its assets to,
another corporation or entity; or

                   (iv) there shall be a voluntary or  involuntary  dissolution,
liquidation or winding-up of the Company;

then,  in each such case,  the Company  shall give to the holder of this Warrant
(a) notice of the date or estimated date on which the books of the Company shall
close or a record  shall be taken for  determining  the holders of Common  Stock
entitled to receive any such dividend,  distribution,  or subscription rights or
for  determining  the holders of Common Stock entitled to vote in respect of any
such reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation  or  winding-up  and  (b) in the  case of any  such  reorganization,
reclassification,  consolidation,  merger,  sale,  dissolution,  liquidation  or
winding-up,  notice of the date (or, if not then known,  a  reasonable  estimate
thereof by the Company)  when the same shall take place.  Such notice shall also
specify  the date on which the  holders of Common  Stock  shall be  entitled  to
receive such dividend, distribution, or subscription rights or to exchange their
Common Stock for stock or other  securities  or property  deliverable  upon such
reorganization,  reclassification,  consolidation,  merger,  sale,  dissolution,
liquidation,  or  winding-up,  as the case may be. Such notice shall be given at
least 30 days prior to the record date or the date on which the Company's  books
are closed in  respect  thereto.  Failure to give any such  notice or any defect
therein shall not affect the validity of the proceedings  referred to in clauses
(i), (ii),  (iii) and (iv) above.  Notwithstanding  the  foregoing,  the Company
shall publicly disclose the substance of any notice delivered hereunder prior to
delivery of such notice to the holder of this Warrant.

               (k) Certain Events.  If, at any time during the Exercise  Period,
any event occurs of the type  contemplated by the adjustment  provisions of this
Section 4 but not expressly  provided for by such  provisions,  the Company will
give notice of such event as provided in Section 4(g) hereof,  and the Company's
Board of Directors will make an appropriate  adjustment in the Exercise Price(s)
and the  number of  shares of Common  Stock  acquirable  upon  exercise  of this
Warrant at each such  Exercise  Price so that the rights of the holder  shall be
neither enhanced nor diminished by such event.

                                      -11-

<PAGE>

               (l) Certain Definitions.

                   (i) "Common Stock Deemed  Outstanding"  shall mean the number
of shares of Common Stock actually  outstanding  (not including shares of Common
Stock  held  in the  treasury  of the  Company),  plus  (x) in the  case  of any
adjustment  required by Section 4(a) resulting from the issuance of any Options,
the maximum total number of shares of Common Stock issuable upon the exercise of
the Options for which the  adjustment  is required  (including  any Common Stock
issuable  upon  the  conversion  of  Convertible  Securities  issuable  upon the
exercise of such  Options),  and (y) in the case of any  adjustment  required by
Section 4(a)  resulting  from the issuance of any  Convertible  Securities,  the
maximum  total  number of shares of Common  Stock  issuable  upon the  exercise,
conversion or exchange of the Convertible Securities for which the adjustment is
required, as of the date of issuance of such Convertible Securities, if any.

                   (ii) "Market Price," as of any date, (i) means the average of
the closing bid prices for the shares of Common  Stock as reported on the NASDAQ
National Market  ("NASDAQ") by Bloomberg for the five  consecutive  trading days
immediately  preceding such date, or (ii) if NASDAQ is not the principal trading
market for the shares of Common  Stock,  the  average of the last  reported  bid
prices as reported by Bloomberg on the principal  trading  market for the Common
Stock during the same period,  or, if there is no bid price for such period, the
last reported sales price as reported by Bloomberg for such period,  or (iii) if
market value cannot be calculated as of such date on any of the foregoing bases,
the Market Price shall be the average fair market value as reasonably determined
by an investment banking firm selected by the Company and reasonably  acceptable
to the holder,  with the costs of the appraisal to be borne by the Company.  The
manner of  determining  the Market  Price of the  Common  Stock set forth in the
foregoing  definition  shall apply with respect to any other security in respect
of which a determination as to market value must be made hereunder.

                   (iii)  "Common  Stock,"  for  purposes  of  this  Section  4,
includes  the  Common  Stock and any  additional  class of stock of the  Company
having no preference as to dividends or distributions  on liquidation,  provided
that the shares  purchasable  pursuant to this Warrant shall include only Common
Stock in respect of which this Warrant is exercisable,  or shares resulting from
any  subdivision  or  combination  of such Common  Stock,  or in the case of any
reorganization,   reclassification,   consolidation,  merger,  or  sale  of  the
character  referred to in Section 4(e) hereof,  the stock or other securities or
property provided for in such Section.

                   (iv) "Measurement Date" means (i) for purposes of any private
offering of  securities  under  Section 4(2) of the  Securities  Act of 1933, as
amended,  the date that the  Company  enters  into  legally  binding  definitive
agreements for the issuance and sale of such securities and (ii) for purposes of
any other issuance of securities, the date of issuance thereof.

            5. Issue Tax. The issuance of  certificates  for Warrant Shares upon
the exercise of this Warrant shall be made without  charge to the holder of this
Warrant or such shares for any issuance  tax or other costs in respect  thereof,
provided  that the  Company  shall not be  required  to pay any tax


                                      -12-

<PAGE>

which may be payable in respect of any  transfer  involved in the  issuance  and
delivery of any certificate in a name other than the holder of this Warrant.

            6. No Rights or Liabilities as a Shareholder. This Warrant shall not
entitle the holder  hereof to any voting rights or other rights as a shareholder
of the  Company.  No provision of this  Warrant,  in the absence of  affirmative
action by the holder hereof to purchase Warrant Shares,  and no mere enumeration
herein of the rights or privileges of the holder hereof,  shall give rise to any
liability  of such  holder for the  Exercise  Price or as a  shareholder  of the
Company,  whether  such  liability is asserted by the Company or by creditors of
the Company.

            7. Transfer, Exchange, Redemption and Replacement of Warrant.

               (a) Restriction on Transfer.  This Warrant and the rights granted
to the holder hereof are  transferable,  in whole or in part,  upon surrender of
this Warrant,  together with a properly executed assignment in the form attached
hereto,  at the office or agency of the  Company  referred  to in  Section  7(e)
below,  provided,  however,  that any transfer or assignment shall be subject to
the  conditions  set forth in Sections 7(f) and (g) hereof and to the provisions
of Sections 2(f) and 2(g) of the Securities Purchase Agreement.  Each transferee
of this Warrant or any portion hereof shall be bound by the selling restrictions
set forth in Section 4(k) of the Securities Purchase Agreement, which Section is
incorporated  herein by reference.  Until due  presentment  for  registration of
transfer  on the books of the  Company,  the  Company  may treat the  registered
holder hereof as the owner and holder  hereof for all purposes,  and the Company
shall not be affected by any notice to the contrary. Notwithstanding anything to
the contrary  contained herein,  the registration  rights described in Section 8
hereof are assignable only in accordance with the provisions of the Registration
Rights Agreement.

               (b)  Warrant  Exchangeable  for  Different  Denominations.   This
Warrant is  exchangeable,  upon the surrender hereof by the holder hereof at the
office or agency of the  Company  referred  to in Section  7(e)  below,  for new
Warrants of like tenor of different denominations  representing in the aggregate
the  right to  purchase  the  number of  shares  of  Common  Stock  which may be
purchased  hereunder,  each of such  new  Warrants  to  represent  the  right to
purchase  such number of shares (at the  Exercise  Price  therefor)  as shall be
designated by the holder hereof at the time of such surrender.

               (c) Replacement of Warrant.  Upon receipt of evidence  reasonably
satisfactory to the Company of the loss,  theft,  destruction,  or mutilation of
this  Warrant and, in the case of any such loss,  theft,  or  destruction,  upon
delivery of an indemnity agreement reasonably satisfactory in form and amount to
the  Company,  or,  in the  case of any  such  mutilation,  upon  surrender  and
cancellation  of this  Warrant,  the Company,  at its expense,  will execute and
deliver, in lieu thereof, a new Warrant of like tenor.

               (d) Cancellation; Payment of Expenses. Upon the surrender of this
Warrant in connection with any transfer, exchange, or replacement as provided in
this Section 7, this  Warrant


                                      -13-

<PAGE>

shall be promptly  canceled  by the  Company.  The  Company  shall pay all taxes
(other than securities  transfer taxes) and all other expenses (other than legal
expenses,  if any,  incurredby the Holder or transferees) and charges payable in
connection with the preparation, execution, and delivery of Warrants pursuant to
this Section 7. The Company  shall  indemnify  and  reimburse the holder of this
Warrant  for all  losses  and  damages  arising as a result of or related to any
breach of the terms of this  Warrant,  including  costs and expenses  (including
reasonable   legal  fees)  incurred  by  such  holder  in  connection  with  the
enforcement of its rights hereunder.

               (e)  Warrant  Register.   The  Company  shall  maintain,  at  its
principal executive offices (or such other office or agency of the Company as it
may designate by notice to the holder hereof),  a register for this Warrant,  in
which the Company  shall record the name and address of the person in whose name
this Warrant has been issued, as well as the name and address of each transferee
and each prior owner of this Warrant.

               (f) Exercise or Transfer Without Registration. If, at the time of
the surrender of this Warrant in  connection  with any  exercise,  transfer,  or
exchange of this  Warrant,  this Warrant (or, in the case of any  exercise,  the
Warrant Shares issuable hereunder), shall not be registered under the Securities
Act and under  applicable  state  securities  or blue sky laws,  the Company may
require, as a condition of allowing such exercise,  transfer,  or exchange,  (i)
that the holder or transferee of this  Warrant,  as the case may be,  furnish to
the  Company a written  opinion  of  counsel  (which  opinion  shall be in form,
substance   and  scope   customary   for  opinions  of  counsel  in   comparable
transactions)  to the effect that such  exercise,  transfer,  or exchange may be
made without  registration  under the Securities Act and under  applicable state
securities  or blue sky laws,  (ii) that the holder or  transferee  execute  and
deliver to the Company an investment letter in form and substance  acceptable to
the Company and (iii) that the transferee be an "accredited investor" as defined
in Rule 501(a)  promulgated  under the  Securities  Act;  provided  that no such
opinion,  letter,  or status as an  "accredited  investor"  shall be required in
connection with a transfer pursuant to Rule 144 under the Securities Act.

               (g) Additional  Restrictions on Exercise or Transfer. In no event
shall the holder of this  Warrant have the right to exercise any portion of this
Warrant for shares of Common  Stock or to dispose of any portion of this Warrant
to the extent  that such right to effect  such  exercise  or  disposition  would
result in the  holder or any of its  affiliates  beneficially  owning  more than
4.99% of the  outstanding  shares of Common  Stock.  To the extent the holder of
this Warrant owns other securities with a limitation on conversion,  exercise or
disposition  analogous to the  limitation  set forth in this Section  7(g),  the
limitations  on  conversion,  exercise and  disposition of this Warrant and such
securities  shall be applied  collectively  to all such  securities  so that the
holder of this  Warrant  may  select  the  order in which it wishes to  convert,
exercise or dispose of such  securities and the holder of this Warrant will only
have the right to effect  conversions,  exercises and  dispositions  of all such
securities to the extent that such  conversions,  exercises and  dispositions do
not result in the holder or any of its affiliates  beneficially owning more than
4.99% of the  outstanding  shares of Common Stock.  For purposes of this Section
7(g),  beneficial ownership shall be determined in accordance with Section 13(d)
of the  Securities  Exchange  Act of 1934,  as  amended,  and  Regulation  13D-G


                                      -14-

<PAGE>

thereunder. The restriction contained in this Section 7(g) shall not be altered,
amended,  deleted or changed in any manner  whatsoever  unless the  holders of a
majority of the outstanding  shares of Common Stock,  the holder of this Warrant
and the Majority Holders shall approve, in writing, such alteration,  amendment,
deletion or change.

            8.  Registration  Rights.  The initial  holder of this  Warrant (and
certain  assignees  thereof) is  entitled  to the  benefit of such  registration
rights in respect  of the  Warrant  Shares as are set forth in the  Registration
Rights  Agreement,  including  the  right  to  assign  such  rights  to  certain
assignees, as set forth therein.

            9. Notices.  Any notices required or permitted to be given under the
terms of this  Warrant  shall be sent by certified  or  registered  mail (return
receipt  requested)  or  delivered  personally  or by  courier  or by  confirmed
telecopy,  and shall be effective  five days after being placed in the mail,  if
mailed,  or upon receipt or refusal of receipt,  if delivered  personally  or by
courier,  or by  confirmed  telecopy,  in each case  addressed  to a party.  The
addresses for such communications shall be:

                    If to the Company:

                    Lumenon Innovative Lightwave Technology, Inc.
                    8851 Trans-Canada Highway
                    St. Laurent, Quebec H4S 1Z6
                    Canada
                    Attention:  Vincent Belanger
                    Telecopy:   (514) 331-3738

                    with copies to:

                    De Grandpre Chaurette Levesque
                    2000 Avenue McGill College, Suite 1600
                    Montreal, Quebec H3A 3H3
                    Canada
                    Attention:  Pierre Barnard
                    Telecopy:   (514)499-0469

                    and:

                    Olshan Grundman Frome Rosenzweig &
                    Wolosky, LLP
                    505 Park Avenue
                    New York, NY  10022
                    Attention:  David J. Adler
                    Telecopy:   (212)935-1787

If to the holder,  at such address as such holder shall have provided in writing
to the  Company,  or at such other  address as such holder  furnishes  by notice
given in accordance with this Section 9.

                                      -15-


<PAGE>

            10. Governing Law;  Jurisdiction.  This Warrant shall be governed by
and construed in accordance with the laws of the State of Delaware.  The Company
irrevocably consents to the jurisdiction of the United States federal courts and
state courts located in the State of Delaware in any suit or proceeding based on
or arising under this Warrant and irrevocably  agrees that all claims in respect
of such  suit or  proceeding  may be  determined  in such  courts.  The  Company
irrevocably  waives any  objection  to the laying of venue and the defense of an
inconvenient  forum to the  maintenance of such suit or proceeding.  The Company
further  agrees that service of process upon the Company  mailed by certified or
registered  mail shall be deemed in every respect  effective  service of process
upon the Company in any such suit or proceeding. Nothing herein shall affect the
holder's  right to serve  process  in any other  manner  permitted  by law.  The
Company  agrees  that a  final  non-appealable  judgment  in any  such  suit  or
proceeding  shall be conclusive  and may be enforced in other  jurisdictions  by
suit on such judgment or in any other lawful manner.

            11. Miscellaneous.

                (a) Amendments.  Except as provided in Section 7(g) hereof, this
Warrant and any provision hereof may only be amended by an instrument in writing
signed by the Company and the holder hereof.

                (b)  Descriptive  Headings.  The  descriptive  headings  of  the
several  Sections of this Warrant are  inserted for purposes of reference  only,
and shall not  affect  the  meaning  or  construction  of any of the  provisions
hereof.

                (c) Cashless Exercise.  Notwithstanding anything to the contrary
contained in this Warrant,  if the resale of the Warrant Shares by the holder is
not then registered  pursuant to an effective  registration  statement under the
Securities  Act, or if there is not  reserved  pursuant  to Article  IV.A of the
Notes a sufficient number of shares of Common Stock to permit full conversion of
the Notes and full  exercise of the  Warrants,  this Warrant may be exercised at
any time  during the  Exercise  Period by  presentation  and  surrender  of this
Warrant to the Company at its principal  executive offices with a written notice
of the holder's intention to effect a cashless exercise, including a calculation
of the  number  of shares of Common  Stock to be issued  upon such  exercise  in
accordance  with the terms  hereof (a  "Cashless  Exercise").  In the event of a
Cashless  Exercise,  in lieu of paying the  Exercise  Price in cash,  the holder
shall  surrender  this  Warrant  for that  number  of  shares  of  Common  Stock
determined  by  multiplying  the  number  of  Warrant  Shares  to which it would
otherwise  be  entitled  by a  fraction,  the  numerator  of which  shall be the
difference between the last reported sale price per share of the Common Stock on
the date of exercise (as reported on NASDAQ, or if not so reported,  as reported
on the principle  United States  securities  market on which the Common Stock is
then traded) and the Exercise Price,  and the denominator of which shall be such
last reported sale price per share of Common Stock.

                (d) Trading Day. For purposes of this Warrant, the term "trading
day" means any day on which NASDAQ or, if the Common Stock is not then traded on
NASDAQ, the principal
                                      -17-

<PAGE>

United States  securities  exchange or trading  market where the Common Stock is
then listed or traded, is open for trading.


                  [REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]

                                      -18-
<PAGE>

            IN WITNESS  WHEREOF,  the  Company  has caused  this Stock  Purchase
Warrant to be signed by its duly authorized officer.


                                         LUMENON INNOVATIVE LIGHTWAVE
                                         TECHNOLOGY, INC.


                                         By:
                                            -----------------------------------
                                         Name:  S. Iraj Najafi
                                              ---------------------------------
                                         Title: President
                                               --------------------------------


                                      -19-

<PAGE>

                           FORM OF EXERCISE AGREEMENT

         (To be Executed by the Holder in order to Exercise the Warrant)

To:   Lumenon Innovative Lightwave Technology, Inc.
      8851 Trans-Canada Highway
      St. Laurent, Quebec H4S 1Z6
      Canada
      Attention:  Vincent Belanger
      Telecopy:   (514) 331-3738

            The undersigned hereby  irrevocably  exercises the right to purchase
_____________  shares  of the  Common  Stock  of  LUMENON  INNOVATIVE  LIGHTWAVE
TECHNOLOGY,  INC.,  a  corporation  organized  under  the  laws of the  State of
Delaware (the "Company"),  evidenced by the attached Warrant and [herewith makes
payment of the  Exercise  Price with  respect  to such  shares in full]  [hereby
elects to effect a  Cashless  Exercise  (as  defined  in  Section  11(c) of such
Warrant], all in accordance with the conditions and provisions of such Warrant.

            The  undersigned  agrees not to offer,  sell,  transfer or otherwise
dispose of any Common Stock  obtained on exercise of the  Warrant,  except under
circumstances that will not result in a violation of the Securities Act of 1933,
as amended, or any state securities laws.

            / /         The  undersigned  requests  that the  Company  cause its
                        transfer  agent to  electronically  transmit  the Common
                        Stock  issuable  pursuant to this Exercise  Agreement to
                        the account of the  undersigned or its nominee (which is
                        _________________)   with  DTC   through   its   Deposit
                        Withdrawal  Agent  Commission  System ("DTC  Transfer"),
                        provided that such transfer  agent  participates  in the
                        DTC Fast Automated Securities Transfer program.

            / /         In lieu of receiving the shares of Common Stock issuable
                        pursuant  to  this  Exercise  Agreement  by  way  of DTC
                        Transfer,  the  undersigned  hereby  requests  that  the
                        Company cause its transfer agent to issue and deliver to
                        the undersigned physical certificates  representing such
                        shares of Common Stock.

            The undersigned requests that a Warrant representing any unexercised
portion hereof be issued, pursuant to the Warrant, in the name of the Holder and
delivered to the undersigned at the address set forth below:

Dated:
      -----------------------


                                                --------------------------------
                                                Signature of Holder



                                                Name of Holder (Print)

                                                Address:

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

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

                                      -20-

<PAGE>



                               FORM OF ASSIGNMENT


            FOR VALUE  RECEIVED,  the  undersigned  hereby sells,  assigns,  and
transfers  all the  rights of the  undersigned  under the within  Warrant,  with
respect  to the  number  of shares of Common  Stock  covered  thereby  set forth
hereinbelow, to:

Name of Assignee               Address                     No of Shares






,      and      hereby      irrevocably       constitutes      and      appoints
_____________________________________  as agent and attorney-in-fact to transfer
said Warrant on the books of the  within-named  corporation,  with full power of
substitution in the premises.


Dated: _____________________, ____

In the presence of


__________________________________

                                             Name:
                                                  ------------------------------
                                             Signature:
                                                       -------------------------
                                             Title of Signing Officer or Agent
                                             (if any):


                                             Address:

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

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

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




                                             Note:   The  above   signature
                                             should correspond exactly with the
                                             name on the face of the within
                                             Warrant.