EXHIBIT 10.2

                                  NQO AGREEMENT


     THIS  AGREEMENT  is  entered  into as of the  Grant  Date  (as  defined  in
paragraph 1) by and between the Participant and Microtek Medical Holdings,  Inc.
(the "Company");

                                WITNESSETH THAT:

     WHEREAS,  the Company  maintains  the 1999  Long-Term  Incentive  Plan (the
"Plan"), which is incorporated into and forms a part of this Agreement,  and the
Participant  has been  selected  by the  committee  administering  the Plan (the
"Committee") to receive an Non-Qualified Stock Option Award under the Plan;

     NOW,  THEREFORE,  IT  IS  AGREED,  by  and  between  the  Company  and  the
Participant, as follows:

     1. TERMS OF AWARD.  The following  terms used in this Agreement  shall have
the meanings set forth in this paragraph 1:

     (a) The "Participant" is __________.

     (b) The "Grant Date" is __________.

     (c) The number of "Covered Shares" shall be __________ shares of Stock.

     (d) The "Exercise Price" is $__________ per share.

Other  terms used in this  Agreement  are  defined  pursuant  to  paragraph 8 or
elsewhere in this Agreement.

     2. AWARD AND EXERCISE  PRICE.  This  Agreement  specifies  the terms of the
option (the  "Option")  granted to the  Participant  to  purchase  the number of
Covered  Shares  of Stock  at the  Exercise  Price  per  share  as set  forth in
paragraph  1. The Option is not  intended  to  constitute  an  "incentive  stock
option" as that term is used in Code Section 422.

     3. DATE OF EXERCISE.  Subject to the  limitations  of this  Agreement,  the
Option shall be  exercisable  on a cumulative  basis  according to the following
schedule,  with respect to each  installment  shown in the schedule on and after
the "Vesting Date" (defined as set forth below) applicable to such installment:


<TABLE>
<CAPTION>
<S>                                                          <C>
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                                                                                   VESTING DATE
                                                                                  APPLICABLE TO
                        INSTALLMENT                                                INSTALLMENT
------------------------------------------------------------ ---------------------------------------------------------


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


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


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


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</TABLE>


<PAGE>

An installment shall not become exercisable on the otherwise  applicable Vesting
Date if the Participant's Date of Termination (as defined in the Plan) occurs on
or before such Vesting Date.  Notwithstanding  the foregoing  provisions of this
paragraph  3, the Option  shall  become  exercisable  with respect to all of the
Covered  Shares  (to the  extent it is not then  otherwise  exercisable)  upon a
Change of Control  (as  defined in the  Plan),  except  that it shall not become
exercisable (a) if the  exercisability of this Option would result in an "excess
parachute  payment" within the meaning of Section 280G of the Code as determined
by the  Committee  based on  information  available  to it at said time,  (b) if
following  such  Change  of  Control  this  Option  shall  remain  in  effect in
accordance  with  its  terms  (subject  to  such  adjustments  as may be made in
accordance with Section 4.2(c) of the Plan), or (c) if the Company exercises its
rights  under  the  following  sentence.  The  Company  shall  have  the  right,
exercisable in the sole discretion of the Company by notice to Participant  upon
or in anticipation of any merger of the Company with or into another corporation
or exchange of  outstanding  capital  stock of the Company for capital  stock of
another  corporation,  to require Participant to purchase,  within ten days from
the date of such notice,  all or any portion of the  remaining  Shares which are
subject  to this  Option  and which the  Participant  shall not have  previously
purchased in accordance with this Option to the extent  Participant shall desire
to do so in the manner otherwise  provided in this Option, and this Option shall
terminate  as to any  shares not so  purchased  as of the date which is ten days
after the date of such notice from the Company to Participant.

     4.  EXPIRATION.  The Option shall not be  exercisable  after the  Company's
close of business on the Expiration  Date (or, if the  Expiration  Date is not a
date in which the Company is open for business, the next regular business day of
the Company). The "Expiration Date" shall be earliest to occur of:

     (a) the ten-year anniversary of the Grant Date;

     (b) if the  Participant's  Date of  Termination  occurs by reason of death,
Disability,  Early Retirement or Retirement, the __________-month anniversary of
such Date of Termination;

     (c) if Participant's Date of Termination occurs for Cause, then the Date of
Termination; or

     (d) if the Participant's  Date of Termination occurs for reasons other than
Cause, death, Disability,  Early Retirement or Retirement,  the __________-month
anniversary of such Date of Termination.

In the event  Participant's  Date of  Termination  occurs  for  Cause,  then the
Company  shall have the right,  exercisable  at the  election  of the Company by
written  notice to  Participant  given within thirty days  following the Date of
Termination,  to purchase  all of the Covered  Shares  previously  purchased  by
Participant for a purchase price equal to the Exercise Price.

     5. METHOD OF OPTION  EXERCISE.  Subject to this Agreement and the Plan, the
Option may be exercised in whole or in part by filing a written  notice with the
Secretary of the Company or his designee at its corporate  headquarters prior to
the  Company's  close of  business on the  Expiration  Date.  Such notice  shall
specify the number of shares of Stock which the Participant  elects to purchase,
and shall be  accompanied  by payment of the  Exercise  Price for such shares of
Stock indicated by the  Participant's  election.  Payment shall be by cash or by
check payable to the Company. Except as otherwise provided by the Committee, (i)
all or a  portion  of the  Exercise  Price  may be  paid by the  Participant  by
delivery  of shares of Stock  owned by the  Participant  and  acceptable  to the
Committee  having an  aggregate  Fair  Market  Value  (valued  as of the date of
exercise) that is equal to the amount of cash that would  otherwise be required;
and (ii) the Participant may pay the Exercise Price by authorizing a third party
to sell shares of Stock (or a sufficient  portion of the shares)  acquired  upon
exercise of the Option and remit to the Company a sufficient portion of the sale
proceeds to pay the entire Exercise Price and any tax withholding resulting from
such  exercise.  The Option  shall not be  exercisable  if and to the extent the
Company  determines that such exercise would violate applicable state or Federal


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<PAGE>

securities laws or the rules and regulations of any securities exchange on which
the Stock is traded. If the Company makes such a determination, it shall use all
reasonable efforts to obtain compliance with such laws, rules or regulations. In
making any  determination  hereunder,  the  Company  may rely on the  opinion of
counsel for the Company.  Any  certificate  representing  shares of Stock issued
upon  exercise of this Option shall contain such legends as the Company shall in
its discretion require.

     6. WITHHOLDING.  All deliveries and distributions  under this Agreement are
subject to withholding of all applicable taxes. Any exercise of the Option shall
be subject to the  Participant's  payment to the Company of an amount sufficient
to satisfy any federal,  state and local tax  withholding  requirements.  At the
election of the Participant,  and subject to the approval of the Committee, such
withholding  obligations  may be  satisfied  through the  surrender of shares of
Stock  which  the  Participant  already  owns,  or to which the  Participant  is
otherwise entitled under the Plan.

     7.  TRANSFERABILITY.  Except as otherwise provided in this paragraph 7, the
Option is not  transferable  other than as designated by the Participant by will
or by the laws of descent and distribution,  and during the Participant's  life,
may be exercised only by the Participant.  However,  the  Participant,  with the
approval of the Committee (which shall be in the Committee's  sole  discretion),
may  transfer  the  Option  for no  consideration  to or for the  benefit of the
Participant's  Immediate Family (including,  without limitation,  to a trust for
the benefit of the Participant's Immediate Family or to a partnership or limited
liability  company  for  one or  more  members  of the  Participant's  Immediate
Family),  subject  to  such  limits  as the  Committee  may  establish,  and the
transferees  shall remain subject to all the terms and conditions  applicable to
the Option prior to such  transfer.  The foregoing  right to transfer the Option
shall apply to the right to consent to amendments to this  Agreement and, in the
discretion of the Committee, shall also apply to the right to transfer ancillary
rights  associated with the Option.  The term "Immediate  Family" shall mean the
Participant's spouse, parents, children,  stepchildren,  adoptive relationships,
sisters,  brothers and grandchildren (and, for this purpose,  shall also include
the Participant).

     8.  DEFINITIONS.  For  purposes of this  Agreement,  the terms used in this
Agreement shall be subject to the following:

     (a) Disability.  The Participant shall be considered to have a "Disability"
during the period in which the  Participant is unable,  by reason of a medically
determinable  physical  or  mental  impairment,   to  engage  in  his  customary
employment with the Company or a Related Company for a duration of not less than
120 days, all as determined in the sole discretion of the Committee.

     (b)  Cause.  "Cause"  shall  mean (i) the  Board of  Directors  shall  have
determined, in good faith, that Participant misappropriated,  stole or embezzled
assets of the Company, or (ii) Participant shall have been convicted of a felony
or a crime involving moral turpitude.

     (c) Plan Definitions. Except where the context clearly implies or indicates
the contrary, a word, term, or phrase used in the Plan is similarly used in this
Agreement.

     9. HEIRS AND SUCCESSORS. This Agreement shall be binding upon, and inure to
the  benefit  of, the  Company and its  successors  and  assigns.  If any rights
exercisable by the Participant or benefits  deliverable to the Participant under
this Agreement have not been exercised or delivered,  respectively,  at the time
of the  Participant's  death, such rights shall be exercisable by the Designated
Beneficiary, and such benefits shall be delivered to the Designated Beneficiary,
in  accordance  with  the  provisions  of  this  Agreement  and  the  Plan.  The
"Designated Beneficiary" shall be the beneficiary or beneficiaries designated by
the  Participant  in a writing filed with the Committee in such form and at such
time  as the  Committee  shall  require.  If a  deceased  Participant  fails  to
designate a beneficiary,  or if the Designated  Beneficiary does not survive the
Participant,  any rights that would have been exercisable by the Participant and
any  benefits  distributable  to  the  Participant  shall  be  exercised  by  or
distributed to the legal  representative of the estate of the Participant.  If a
deceased  Participant  designates a beneficiary  but the Designated  Beneficiary


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<PAGE>

dies  before the  Designated  Beneficiary's  exercise  of all rights  under this
Agreement  or before the  complete  distribution  of benefits to the  Designated
Beneficiary  under  this  Agreement,  then  any  rights  that  would  have  been
exercisable  by the  Designated  Beneficiary  shall be  exercised  by the  legal
representative  of the estate of the  Designated  Beneficiary,  and any benefits
distributable  to the Designated  Beneficiary  shall be distributed to the legal
representative of the estate of the Designated Beneficiary.

     10.  ADMINISTRATION.  The authority to manage and control the operation and
administration  of this  Agreement  shall be  vested in the  Committee,  and the
Committee  shall have all powers with  respect to this  Agreement as it has with
respect to the Plan.  Any  interpretation  of the Agreement by the Committee and
any decision  made by it with  respect to the  Agreement is final and binding on
all persons.

     11.  PLAN  GOVERNS.  Notwithstanding  anything  in  this  Agreement  to the
contrary, the terms of this Agreement shall be subject to the terms of the Plan,
a copy of which  may be  obtained  by the  Participant  from the  office  of the
Secretary of the Company;  and this Agreement is subject to all interpretations,
amendments, rules and regulations promulgated by the Committee from time to time
pursuant to the Plan.

     12.  NOT  AN  EMPLOYMENT  CONTRACT.  The  Option  will  not  confer  on the
Participant any right with respect to continuance of employment or other service
with the Company or any Related  Company,  nor will it interfere in any way with
any right the Company or any Related  Company would  otherwise have to terminate
or modify the terms of such  Participant's  employment  or other  service at any
time.

     13. NOTICES. Any written notices provided for in this Agreement or the Plan
shall be in  writing  and shall be  deemed  sufficiently  given if  either  hand
delivered or if sent by fax or overnight courier, or by postage paid first class
mail.  Notices sent by mail shall be deemed  received  three business days after
mailed but in no event later than the date of actual  receipt.  Notices shall be
directed,  if to the Participant,  at the Participant's address indicated by the
Company's records,  or if to the Company,  at the Company's  principal executive
office.

     14.  FRACTIONAL  SHARES.  In lieu of issuing a fraction of a share upon any
exercise of the Option  resulting  from an adjustment of the Option  pursuant to
paragraph  4.2(c) of the Plan or otherwise,  the Company will be entitled to pay
to the  Participant an amount equal to the fair market value of such  fractional
share.

     15. NO RIGHTS AS SHAREHOLDER.  The Participant shall not have any rights of
a shareholder  with respect to the shares  subject to the Option,  until a stock
certificate  has been duly issued  following  exercise of the Option as provided
herein.

     16.  AMENDMENT.  This Agreement may be amended by written  agreement of the
Participant and the Company, without the consent of any other person.



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<PAGE>


     IN WITNESS  WHEREOF,  the Participant has executed this Agreement,  and the
Company has caused these  presents to be executed in its name and on its behalf,
all as of the Grant Date.

                                        PARTICIPANT

                                        ________________________________________



                                        MICROTEK MEDICAL HOLDINGS, INC.


                                        By: ____________________________________
                                        Its: ___________________________________


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