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EXHIBIT 4.3

                               WARRANT CERTIFICATE

THIS COMMON STOCK PURCHASE  WARRANT AND THE SECURITIES  REPRESENTED  HEREBY HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
TRANSFERRED  IN VIOLATION OF SUCH ACT, THE RULES AND  REGULATIONS  THEREUNDER OR
THE PROVISIONS OF THIS COMMON STOCK PURCHASE WARRANT, AND ARE SUBJECT TO CERTAIN
OTHER TRANSFER RESTRICTIONS SET FORTH IN THE HOLDBACK AGREEMENT ANNEXED HERETO.

                   Number of Shares of Common Stock: 3,572

                          COMMON STOCK PURCHASE WARRANT

                           To Purchase Common Stock of

                             World Diagnostics, Inc.

            THIS  IS  TO  CERTIFY  THAT   ___________________________,   or  its
permitted and registered assigns, is entitled, at any time from the Funding Date
(as hereinafter  defined) to the Expiration Date (as  hereinafter  defined),  to
purchase from WORLD DIAGNOSTICS,  INC., a Delaware  corporation (the "Company"),
three  thousand  five  hundred  seventy two (3,572)  shares of Common  Stock (as
hereinafter  defined and subject to adjustment as provided herein),  in whole or
in part,  including  fractional  parts,  at a purchase  price equal to $7.00 per
share,  all  on  the  terms  and  conditions  and  pursuant  to  the  provisions
hereinafter set forth.

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1.          DEFINITIONS

            As used in this Common Stock Purchase Warrant (this "Warrant"),  the
following terms have the respective meanings set forth below:

            "Additional  Shares of Common Stock" shall mean all shares of Common
Stock issued by the Company  after the Funding Date,  other than Warrant  Shares
and Exchange Shares.

            "Business  Day" shall mean any day that is not a Saturday  or Sunday
or a day on which banks are  required or  permitted to be closed in the State of
New York.

            "Commission"  shall mean the Securities  and Exchange  Commission or
any other federal agency then administering the Securities Act and other federal
securities laws.

            "Common  Stock"  shall  mean  (except  where the  context  otherwise
indicates) the Common Stock, par value $0.001,  of the Company as constituted on
the  Funding  Date,  and any  capital  stock into which  such  Common  Stock may
thereafter  be changed,  and shall also include (i) capital stock of the Company
of any other  class  (regardless  of how  denominated)  issued to the holders of
shares of  Common  Stock  upon any  reclassification  thereof  which is also not
preferred as to dividends or assets over any other class of stock of the Company
and which is not subject to  redemption  and (ii) shares of common  stock of any
successor or acquiring  corporation received by or distributed to the holders of
Common Stock of the Company in the circumstances contemplated by Section 4.4.

            "Convertible  Securities"  shall  mean  evidences  of  indebtedness,
shares of stock or other  securities which are convertible into or exchangeable,
with or without  payment of additional  consideration  in cash or property,  for
shares of Common Stock, either immediately or upon the occurrence of a specified
date or a specified event.

            "Current  Warrant Price" shall mean, in respect of a share of Common
Stock at any date herein  specified,  the price at which a share of Common Stock
may be purchased pursuant to this Warrant on such date.

            "Exchange  Act" shall mean the  Securities  Exchange Act of 1934, as
amended, or any successor federal statute,  and the rules and regulations of the
Commission thereunder, all as the same shall be in effect from time to time.

            "Exchange  Commencement  Date"  shall have the  meaning set forth in
Section 2.2.

            "Exchange Shares" shall have the meaning set forth in Section 2.2.

            "Exercise Period" shall mean the period during which this Warrant is
exercisable pursuant to Section 2.1.

            "Expiration  Date"  shall mean the date that is three (3) years from
the date of this Warrant.

            "Funding  Date"  shall mean the date and time of the  closing of the
sale of the Common Stock and the Warrants under the Subscription Agreement.

            "Holder"  shall mean the Person in whose name the Warrant or Warrant
Shares set forth herein is registered on the books of the Company maintained for
such purpose.

            "Holdback  Agreement"  shall mean that certain  Holdback  Agreement,
dated as of the date  hereof,  by and between the Company and the Holder,  as it
may be amended from time to time,  with respect to  restrictions on the Transfer
of Common  Stock and  Exchange  Shares,  the form of which is annexed  hereto as
Exhibit D.

            "Market Price" means the average closing ask price of a share of the
Common Stock during the sixty (60) day period prior to the Exchange Commencement
Date (as defined in Section 3.1) as reported by the NASDAQ Stock  Market,  Inc.,
National  Market System  ("NMS").  If such security is not listed or admitted to
trading on the NMS, on the  principal  national  security  exchange or quotation
system on which such security is quoted or listed or admitted to trading, or, if
not quoted or listed or admitted to trading on any national  securities exchange
or  quotation   system,   the  closing  ask  price  of  such   security  on  the
over-the-counter  market on the day in  question  as  reported  by the  National
Quotation  Bureau  Incorporated,  or  a  similar  generally  accepted  reporting
service, or if not so available,  in such manner as furnished by any NASD member
firm  selected  from time to time by the Board of  Directors  of the Company for
that purpose,  or a price  determined in good faith by the Board of Directors of
the Company as being equal to the fair market value thereof, as the case may be.

            "Other Property" shall have the meaning set forth in Section 4.4.

            "Outstanding"  shall mean, when used with reference to Common Stock,
at any date as of which the number of shares  thereof is to be  determined,  all
issued  shares of Common  Stock,  except shares then owned or held by or for the
account of the Company or any subsidiary  thereof,  and shall include all shares
issuable  in  respect  of  outstanding  scrip or any  certificates  representing
fractional interests in shares of Common Stock.

            "Person"   shall   mean   any   individual,   sole   proprietorship,
partnership,  joint  venture,  trust,  incorporated  organization,  association,
corporation,  institution,  public  benefit  corporation,  entity or  government
(whether  federal,  state,  county,  city,  municipal or  otherwise,  including,
without limitation,  any instrumentality,  division,  agency, body or department
thereof).

            "Registration  Statement"  means  a  registration  statement  of the
Company filed on an appropriate  form under the Securities Act providing for the
registration  of,  and  the  sale  by the  holders  of,  all of the  Registrable
Securities under the Securities Act, including the prospectus  contained therein
and forming a part thereof,  any amendments to such  registration  statement and
supplements to such prospectus, and all exhibits and other material incorporated
by reference in such registration statement and prospectus.

            "Restricted  Common  Stock"  shall mean shares of Common Stock which
are, or which upon their  issuance on the  exercise or exchange of this  Warrant
would be, evidenced by a certificate bearing the restrictive legend set forth in
Section 9.1(b) or Section 9.1(c).

            "Securities  Act" shall mean the Securities Act of 1933, as amended,
or  any  successor  federal  statute,  and  the  rules  and  regulations  of the
Commission thereunder, all as the same shall be in effect at the time.

            "Subscription  Agreement"  shall  mean the  Subscription  Agreement,
dated the date hereof,  by and between the Company and the Holder,  as it may be
amended from time to time.

            "Transfer" shall mean any disposition of any Common Stock,  Warrant,
Warrant  Shares or Exchange  Shares,  or of any interest in any  thereof,  which
would constitute a sale thereof within the meaning of the Securities Act.

            "Transfer Notice" shall have the meaning set forth in Section 9.2.

            "Warrants"  shall mean this  Warrant  and all  warrants  issued upon
transfer,  division or combination of, or in substitution for, any thereof.  All
Warrants  shall at all times be identical as to terms and  conditions  and date,
except  as to the  number of  shares  of  Common  Stock  for  which  they may be
exercised.

            "Warrant  Price"  shall  mean an amount  equal to (i) the  number of
shares of Common Stock being purchased upon exercise of this Warrant pursuant to
Section 2.1, multiplied by (ii) the Current Warrant Price as of the date of such
exercise.

            "Warrant  Shares" shall mean the shares of Common Stock purchased by
the holders of the Warrants upon the exercise thereof .

2.          EXERCISE OF WARRANT; EXCHANGE OF WARRANT

2.1 Manner of Exercise of Warrant. From and after the Funding Date (the "Warrant
Period  Commencement  Date")  and until 5:00  P.M.,  New York City time,  on the
Expiration  Date,  Holder may exercise  this  Warrant,  on any Business  Day, in
increments of 1,000 shares of Common Stock purchasable hereunder.

            In order to exercise this Warrant, in whole or in part, Holder shall
deliver to the Company at its  principal  office at 15271 NW 60th Avenue,  Miami
Lakes,  Florida  33014,  or at the office or agency  designated  by the  Company
pursuant  to Section 12, (i) a written  notice of Holder's  election to exercise
this Warrant, which notice shall specify the number of shares of Common Stock to
be  purchased,  (ii) payment of the Warrant Price in cash or by wire transfer or
cashier's  check drawn on a United  States bank,  and (iii) this  Warrant.  Such
notice shall be substantially in the form of the subscription  form appearing at
the end of this  Warrant as Exhibit A, duly  executed  by Holder or its agent or
attorney.  Upon receipt of the items  referred to in clauses (i), (ii) and (iii)
above,  the Company shall, as promptly as  practicable,  and in any event within
ten (10) Business Days  thereafter,  execute or cause to be executed and deliver
or cause to be delivered to Holder a certificate  or  certificates  representing
the aggregate number of full shares of Common Stock issuable upon such exercise,
together with cash in lieu of any fraction of a share, as hereinafter  provided.
The stock  certificate  or  certificates  so  delivered  shall be, to the extent
possible,  in such  denomination or denominations as Holder shall request in the
notice and shall be registered  in the name of Holder or,  subject to Section 9,
such other name as shall be  designated  in the notice.  This  Warrant  shall be
deemed to have been  exercised and such  certificate  or  certificates  shall be
deemed to have been issued,  and Holder or any other Person so  designated to be
named  therein  shall be deemed to have become a holder of record of such shares
for all purposes, as of the date the notice,  together with the cash or check or
checks and this Warrant,  is received by the Company as described  above and all
taxes  required to be paid by Holder,  if any,  pursuant to Section 3.1 prior to
the  issuance  of such shares have been paid.  If this  Warrant  shall have been
exercised in part, the Company shall, at the time of delivery of the certificate
or certificates  representing  Warrant  Shares,  deliver to Holder a new Warrant
evidencing  the rights of Holder to purchase  the  unpurchased  shares of Common
Stock called for by this Warrant,  which new Warrant shall in all other respects
be  identical  with this  Warrant,  or, at the  request of  Holder,  appropriate
notation  may be  made  on  this  Warrant  and  the  same  returned  to  Holder.
Notwithstanding  any provision herein to the contrary,  the Company shall not be
required to register  shares in the name of any Person who acquired this Warrant
(or part hereof) or any Warrant Shares  otherwise  than in accordance  with this
Warrant and the Holdback Agreement.

2.2 Manner of Exchange of Warrant.  From and after the date which is ninety (90)
days following Funding Date (the "Exchange Period  Commencement Date") and until
5:00 P.M.,  New York City time,  on the  Expiration  Date,  Holder  may,  on any
Business Day,  exchange  this Warrant for shares of Common Stock (the  "Exchange
Shares") equal to the number of Warrants granted  hereunder,  provide,  however,
that the Holder may not exercise  its right to exchange  this Warrant for Common
Stock if (i) on the Exchange Period Commencement Date the Market Price per share
of Common Stock is greater than or equal to $20.00,  and (ii) the average  daily
trading volume for the shares of the Common Stock during any thirty  consecutive
trading day period prior to the  Exchange  Period  Commencement  Date is greater
than thirty five thousand (35,000).

            Upon the exchange of this Warrant  pursuant to this Section 2.2, the
Common Stock issued to the Holder pursuant to the Subscription Agreement and the
Exchange  Shares issued  pursuant to this Section 2.2 shall,  in addition to the
restrictions  under  the  Securities  Act  and  set  forth  herein  and  in  the
Subscription Agreement, be subject to the to the Transfer restrictions set forth
in the Holdback Agreement.

            In order to exercise  your right to exchange this Warrant for Common
Stock,  Holder shall deliver to the Company at its principal  office at 15271 NW
60th Avenue,  Miami Lakes,  Florida 33014, or at the office or agency designated
by the Company pursuant to Section 12, (i) a written notice of Holder's election
to exchange this Warrant and receive the Exchange Shares, and (ii) this Warrant.
Such notice shall be  substantially  in the form of the notice form appearing at
the end of this  Warrant as Exhibit B, duly  executed  by Holder or its agent or
attorney.  Upon receipt of the items  referred to in clauses (i) and (ii) above,
the Company shall, as promptly as practicable,  and in any event within ten (10)
Business Days  thereafter,  execute or cause to be executed and deliver or cause
to be  delivered to Holder,  a  certificate  or  certificates  representing  the
aggregate  number of Exchange Shares issuable upon such exchange,  together with
cash in lieu of any  fraction of a share,  as  hereinafter  provided.  The stock
certificate or certificates so delivered  shall be, to the extent  possible,  in
such  denomination  or  denominations  as Holder shall request in the notice and
shall be registered  in the name of Holder or,  subject to Section 9, such other
name as shall be designated in the notice.  This Warrant shall be deemed to have
been exchanged and such certificate or certificates shall be deemed to have been
issued,  and Holder or any other Person so  designated to be named therein shall
be deemed to have become a holder of record of such shares for all purposes,  as
of the date the notice,  together with this Warrant,  is received by the Company
as described above and all taxes required to be paid by Holder, if any, pursuant
to  Section  3.1  prior to the  issuance  of such  shares  have  been  paid for.
Notwithstanding  any provision herein to the contrary,  the Company shall not be
required to register  shares in the name of any Person who acquired this Warrant
(or part hereof) or any Warrant Shares  otherwise  than in accordance  with this
Warrant and the Registration Rights Agreement.

2.3 Fractional  Shares.  The Company shall not be required to issue a fractional
share of Common  Stock upon  exercise  or  exchange  of any  Warrant.  As to any
fraction of a share which  Holder would  otherwise be entitled to purchase  upon
such exercise,  the Company shall pay a cash adjustment in respect of such final
fraction in an amount  equal to the same  fraction of the Market Price per share
of Common Stock as of the Initial Funding Date.

2.4  Continued  Validity.  A holder of shares of Common  Stock  issued  upon the
exercise or exchange of this  Warrant,  in whole or in part (other than a holder
who acquires  such shares after the same have been  publicly  sold pursuant to a
Registration  Statement  under the  Securities  Act or sold pursuant to Rule 144
thereunder),  shall  continue to be entitled  with respect to such shares to all
rights to which it would have been  entitled as Holder under  Sections 9, 10 and
14 of this  Warrant.  The Company  will,  at the time of exercise or exchange of
this Warrant,  in whole or in part,  upon the request of Holder,  acknowledge in
writing, in form reasonably satisfactory to Holder, its continuing obligation to
afford Holder all such rights;  provided,  however, that if Holder shall fail to
make any such request,  such failure shall not affect the continuing  obligation
of the Company to afford to Holder all such rights.

3.          TRANSFER, DIVISION AND COMBINATION

3.1 Transfer.  Subject to compliance with the Subscription Agreement and Section
3.1 and Section 9 herein,  transfer of this Warrant and all rights hereunder, in
whole or in  part,  shall  be  registered  on the  books  of the  Company  to be
maintained  for such  purpose,  upon  surrender of this Warrant at the principal
office  of the  Company  referred  to in  Section  2.1 or the  office  or agency
designated  by the  Company  pursuant  to Section  12,  together  with a written
assignment  of this Warrant  substantially  in the form of Exhibit C hereto duly
executed  by Holder or its agent or  attorney  and funds  sufficient  to pay any
transfer  taxes payable upon the making of such  transfer.  Upon such  surrender
and, if required, such payment, the Company shall, subject to Section 9, execute
and deliver a new Warrant or Warrants in the name of the  permitted  assignee or
assignees and in the  denomination  specified in such  instrument of assignment,
and shall  issue to the  assignor a new Warrant  evidencing  the portion of this
Warrant  not so  assigned,  and this  Warrant  shall  promptly be  cancelled.  A
Warrant,  if properly assigned in compliance with Section 9, may be exercised or
exchange  by a new Holder for the  purchase  of shares of Common  Stock  without
having a new Warrant issued.

3.2 Division and Combination.  Subject to Section 3.1 and 9, this Warrant may be
divided  or  combined  with  other  Warrants  upon  presentation  hereof  at the
aforesaid  office or  agency  of the  Company,  together  with a written  notice
specifying the names and  denominations  in which new Warrants are to be issued,
signed by Holder or its agent or attorney.  Subject to  compliance  with Section
3.1 and Section 9, as to any transfer  which may be involved in such division or
combination,  the Company shall execute and deliver a new Warrant or Warrants in
exchange  for the Warrant or  Warrants  to be divided or combined in  accordance
with such notice.

3.3 Expenses.  The Company shall  prepare,  issue and deliver at its own expense
(other than transfer taxes) the new Warrant or Warrants under this Section 3.

3.4         Maintenance of Books.  The Company agrees to maintain, at its
aforesaid office or agency, books for the registration and the registration
of transfer of the Warrants.

4.          ADJUSTMENTS

      The number of shares of Common Stock for which this Warrant is exercisable
or  exchangeable,  or the  price at which  such  shares  may be  purchased  upon
exercise of this Warrant,  shall be subject to  adjustment  from time to time as
set forth in this Section 4. The Company  shall give Holder  notice of any event
described  below which requires an adjustment  pursuant to this Section 4 at the
time of such event.

4.1         Stock Dividends, Subdivisions and Combinations.  If at any time
the Company shall:

(a)   take a record  of the  holders  of its  Common  Stock for the  purpose  of
      entitling them to receive a dividend payable in, or other distribution of,
      Additional Shares of Common Stock,

(b)         subdivide its Outstanding shares of Common Stock into a larger
      number of shares of Common Stock, or

(c)         combine its Outstanding shares of Common Stock into a smaller
      number of shares of Common Stock,

then (i) the  number  of  shares of Common  Stock  for  which  this  Warrant  is
exercisable or exchangeable  immediately  after the occurrence of any such event
shall be adjusted  to equal the number of shares of Common  Stock which a record
holder of the same  number of shares of Common  Stock for which this  Warrant is
exercisable or  exchangeable  immediately  prior to the occurrence of such event
would own or be entitled to receive after the happening of such event,  and (ii)
the Current  Warrant  Price  shall be adjusted to equal (A) the Current  Warrant
Price  multiplied by the number of shares of Common Stock for which this Warrant
is exercisable or exchangeable  immediately  prior to the adjustment  divided by
(B) the number of shares for which this Warrant is exercisable immediately after
such adjustment.

4.2         Certain Other Distributions.  If at any time the Company shall
take a record of the holders of its Common Stock for the purpose of entitling
them to receive any dividend or other distribution of:

(a)         cash,

(b)   any  evidences of its  indebtedness,  any shares of its stock or any other
      securities  or  property  of  any  nature  whatsoever  (other  than  cash,
      Convertible Securities or Additional Shares of Common Stock), or

(c)   any warrants or other rights to subscribe for or purchase any evidences of
      its  indebtedness,  any  shares of its stock or any  other  securities  or
      property of any nature whatsoever (other than cash, Convertible Securities
      or Additional Shares of Common Stock),

then Holder shall be entitled to receive  such  dividend or  distribution  as if
Holder had exercised this Warrant. A reclassification of the Common Stock (other
than a change  in par  value,  or from par  value to no par value or from no par
value to par value) into shares of Common Stock and shares of any other class of
stock shall be deemed a distribution by the Company to the holders of its Common
Stock of such  shares of such other  class of stock  within the  meaning of this
Section 4.2 and, if the outstanding shares of Common Stock shall be changed into
a  larger  or  smaller  number  of  shares  of  Common  Stock  as a part of such
reclassification,  such change shall be deemed a subdivision or combination,  as
the case may be, of the outstanding shares of Common Stock within the meaning of
Section 4.1.

4.3 Other Provisions Applicable to Adjustments under this Section. The following
provisions  shall be  applicable to the making of  adjustments  of the number of
shares of Common Stock for which this Warrant is exercisable or exchangeable and
the Current Warrant Price provided for in this Section 4:

(a)   When  Adjustments to Be Made. The  adjustments  required by this Section 4
      shall be made  whenever and as often as any specified  event  requiring an
      adjustment shall occur.  For the purpose of any adjustment,  any specified
      event  shall be deemed to have  occurred  at the close of  business on the
      date of its occurrence.

(b)         Fractional Interests.  In computing adjustments under this
      Section 4, fractional interests in Common Stock shall be taken into
      account to the nearest 1/10th of a share.

(c)         When Adjustment Not Required.  If the Company shall take a record
      of the holders of its Common Stock for the purpose of entitling them to
      receive a dividend or distribution or subscription or purchase rights
      and shall, thereafter and before the distribution to stockholders
      thereof, legally abandon its plan to pay or deliver such dividend,
      distribution, subscription or purchase rights, then thereafter no
      adjustment shall be required by reason of the taking of such record and
      any such adjustment previously made in respect thereof shall be
      rescinded and annulled.

(d)   Challenge to Good Faith Determination.  Whenever the Board of Directors of
      the Company shall be required to make a determination in good faith of the
      fair  value of any item under this  Section 4, such  determination  may be
      challenged in good faith by the Holder,  and any dispute shall be resolved
      by an investment banking firm of recognized  national standing selected by
      the Company and reasonably acceptable to the Holder.

4.4 Reorganization,  Reclassification,  Merger,  Consolidation or Disposition of
Assets.  If the Company shall  reorganize  its capital,  reclassify  its capital
stock,  consolidate or merge with or into another corporation (where the Company
is not the surviving  corporation or where there is a change in or  distribution
with respect to the Common Stock of the Company), or sell, transfer or otherwise
dispose of all or  substantially  all of its  property,  assets or  business  to
another  corporation  and,  pursuant  to  the  terms  of  such   reorganization,
reclassification,  merger,  consolidation  or disposition  of assets,  shares of
common stock of the successor or acquiring  corporation,  or any cash, shares of
stock or other  securities  or  property  of any  nature  whatsoever  (including
warrants or other  subscription or purchase rights) in addition to or in lieu of
common stock of the successor or acquiring  corporation ("Other Property"),  are
to be received by or  distributed to the holders of Common Stock of the Company,
then Holder shall have the right  thereafter  to receive,  upon  exercise of the
Warrant  within ten (10)  business days  following the Company's  notice of such
event,  the  number  of shares of common  stock of the  successor  or  acquiring
corporation  or of the Company,  if it is the surviving  corporation,  and Other
Property   receivable   upon   or   as  a   result   of   such   reorganization,
reclassification,  merger, consolidation or disposition of assets by a holder of
the  number of shares of Common  Stock for which  this  Warrant  is  exercisable
immediately  prior  to  such  event.  In the  case of any  such  reorganization,
reclassification,  merger, consolidation or disposition of assets, the successor
or acquiring  corporation (if other than the Company) shall expressly assume the
due and  punctual  observance  and  performance  of each and every  covenant and
condition of this  Warrant to be  performed  and observed by the Company and all
the obligations and liabilities hereunder,  subject to such modifications as may
be deemed  appropriate (as determined by resolution of the Board of Directors of
the Company) in order to provide for  adjustments  of shares of Common Stock for
which  this  Warrant  is  exercisable  which  shall be as nearly  equivalent  as
practicable to the  adjustments  provided for in this Section 4. For purposes of
this Section 4.4, "common stock of the successor or acquiring corporation" shall
include  stock of such  corporation  of any class which is not  preferred  as to
dividends or assets over any other class of stock of such  corporation and which
is  not  subject  to  redemption   and  shall  also  include  any  evidences  of
indebtedness,  shares of stock or other securities which are convertible into or
exchangeable  for any such stock,  either  immediately  or upon the arrival of a
specified  date or the happening of a specified  event and any warrants or other
rights to subscribe for or purchase any such stock. The foregoing  provisions of
this  Section  4.4  shall   similarly   apply  to  successive   reorganizations,
reclassifications, mergers, consolidations or disposition of assets.

4.5 Other Action Affecting Common Stock. If at any time or from time to time the
Company  shall take any action in  respect of its Common  Stock,  other than any
action described in this Section 4, which would have a materially adverse effect
upon the rights of the Holder,  the number of shares of Common  Stock and/or the
purchase  price  thereof shall be adjusted in such manner as may be equitable in
the circumstances,  as determined in good faith by the Board of Directors of the
Company.

4.6 Certain Limitations.  Notwithstanding  anything herein to the contrary,  the
Company  agrees  not to enter  into any  transaction  which,  by  reason  of any
adjustment hereunder,  would cause the Current Warrant Price to be less than the
par value per share of Common Stock.

5.          NOTICES TO HOLDER

5.1 Notice of  Adjustments.  Whenever  the number of shares of Common  Stock for
which this  Warrant is  exercisable  or  exchangeable,  or whenever the price at
which a share  of such  Common  Stock  may be  purchased  upon  exercise  of the
Warrants,  shall be adjusted  pursuant to Section 4, the Company shall forthwith
prepare a  certificate  to be  executed  by the chief  financial  officer of the
Company setting forth, in reasonable  detail, the event requiring the adjustment
and the method by which such adjustment was calculated  (including a description
of the basis on which the Board of Directors of the Company  determined the fair
value of any evidences of  indebtedness,  shares of stock,  other  securities or
property or warrants or other  subscription  or purchase  rights  referred to in
Section  4.2),  specifying  the number of shares of Common  Stock for which this
Warrant is exercisable or exchangeable and (if such adjustment was made pursuant
to Section  4.4 or 4.5)  describing  the number and kind of any other  shares of
stock or Other Property for which this warrant is  exercisable or  exchangeable,
and any change in the purchase price or prices  thereof,  after giving effect to
such  adjustment or change.  The Company shall  promptly  cause a signed copy of
such  certificate to be delivered to the Holder in accordance with Section 14.2.
The Company shall keep at its office or agency designated pursuant to Section 12
copies  of all  such  certificates  and  cause  the  same  to be  available  for
inspection  at said office  during  normal  business  hours by the Holder or any
prospective purchaser of a Warrant designated by the Holder.

5.2         Notice of Corporate Action.  If at any time

(a)   the Company shall take a record of the holders of its Common Stock for the
      purpose of entitling them to receive a dividend or other distribution,  or
      any right to subscribe for or purchase any evidences of its  indebtedness,
      any shares of stock of any class or any other  securities or property,  or
      to receive any other right, or

(b)   there  shall  be  any  capital   reorganization   of  the   Company,   any
      reclassification  or  recapitalization of the capital stock of the Company
      or any consolidation or merger of the Company with, or any sale,  transfer
      or other disposition of all or substantially  all the property,  assets or
      business of the Company to, another corporation, or

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

then, in any one or more of such cases,  the Company shall give to Holder (i) at
least ten 10 Business  Days' prior written  notice of the date on which a record
date  shall  be  selected  for  such  dividend,  distribution  or  right  or for
determining   rights   to  vote  in   respect   of  any   such   reorganization,
reclassification,    merger,   consolidation,   sale,   transfer,   disposition,
dissolution,  liquidation  or  winding  up,  and  (ii) in the  case of any  such
reorganization,   reclassification,   merger,  consolidation,   sale,  transfer,
disposition,  dissolution, liquidation or winding up, at least ten (10) Business
Days'  prior  written  notice of the date when the same shall take  place.  Such
notice in accordance  with the foregoing  clause also shall specify (i) the date
on which  any such  record  is to be taken  for the  purpose  of such  dividend,
distribution  or right,  the date on which the holders of Common  Stock shall be
entitled  to any such  dividend,  distribution  or  right,  and the  amount  and
character  thereof,  and  (ii)  the  date  on  which  any  such  reorganization,
reclassification,    merger,   consolidation,   sale,   transfer,   disposition,
dissolution,  liquidation  or winding  up is to take place and the time,  if any
such  time is to be fixed,  as of which the  holders  of Common  Stock  shall be
entitled  to  exchange  their  shares of Common  Stock for  securities  or other
property  deliverable  upon  such  reorganization,   reclassification,   merger,
consolidation, sale, transfer, disposition,  dissolution, liquidation or winding
up. Each such written notice shall be sufficiently  given if addressed to Holder
at the  last  address  of  Holder  appearing  on the  books of the  Company  and
delivered in accordance with Section 14.2.

6.          NO IMPAIRMENT

      (a) The Company shall not by any action,  including,  without  limitation,
amending  its  certificate  of  incorporation  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  performance  of any of the terms of this  Warrant,  but will at all times in
good faith assist in the carrying out of all such terms and in the taking of all
such actions as may be necessary or  appropriate to protect the rights of Holder
against  impairment.  Without  limiting the  generality  of the  foregoing,  the
Company  will (i) not  increase  the par value of any  shares  of  Common  Stock
receivable  upon the  exercise  or  exchange  of this  Warrant  above the amount
payable  therefor  upon such  exercise  or  exchange  immediately  prior to such
increase  in par  value,  (ii)  take  all such  action  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 or exchange of this
Warrant,  and (iii) use its best  efforts  to  obtain  all such  authorizations,
exemptions  or consents  from any public  regulatory  body  having  jurisdiction
thereof as may be  necessary  to enable the Company to perform  its  obligations
under this Warrant.

      (b) Upon the request of Holder,  the  Company  will at any time during the
period this Warrant is outstanding  acknowledge in writing, in form satisfactory
to Holder,  the continuing  validity of this Warrant and the  obligations of the
Company hereunder.

7.          RESERVATION AND AUTHORIZATION OF COMMON STOCK

      (a) From and  after  the  Funding  Date,  the  Company  shall at all times
reserve and keep  available  for issue upon the exercise or exchange of Warrants
such number of its  authorized  but  unissued  shares of Common Stock as will be
sufficient  to  permit  the  exercise  or  exchange  in full of all  outstanding
Warrants.  All shares of Common  Stock which shall be so  issuable,  when issued
upon exercise or exchange of any Warrant and payment therefor in accordance with
the terms of such Warrant,  shall be duly and validly  issued and fully paid and
nonassessable, and not subject to preemptive rights.

      (b) Before taking any action which would cause an adjustment  reducing the
Current  Warrant Price below the then par value, if any, of the shares of Common
Stock issuable upon exercise or exchange of the Warrants, the Company shall take
any  corporate  action  which may be  necessary  in order that the  Company  may
validly and legally  issue fully paid and  non-assessable  shares of such Common
Stock at such adjusted Current Warrant Price.

      (c) Before  taking any action which would result in an  adjustment  in the
number of shares of Common  Stock for  which  this  Warrant  is  exercisable  or
exchangeable or in the Current Warrant Price,  the Company shall obtain all such
authorizations or exemptions  thereof,  or consents thereto, as may be necessary
from any public regulatory body or bodies having jurisdiction thereof.

8.          TAKING OF RECORD; STOCK AND WARRANT TRANSFER BOOKS

      In the case of all dividends or other  distributions by the Company to the
holders of its Common  Stock with  respect to which any  provision  of Section 4
refers to the taking of a record of such holders,  the Company will in each such
case take such a record and will take such record as of the close of business on
a Business  Day.  The Company  will not at any time,  except  upon  dissolution,
liquidation  or winding up of the  Company,  close its stock  transfer  books or
Warrant transfer books so as to result in preventing or delaying the exercise or
transfer of any Warrant.

9.          RESTRICTIONS ON TRANSFERABILITY

      The  Warrants,  the Warrant  Shares and the  Exchange  Shares shall not be
transferred,  hypothecated  or assigned  before  satisfaction  of the conditions
specified in this Section 9 and the Holdback  Agreement,  which  conditions are,
among other things,  intended to ensure  compliance  with the  provisions of the
Securities  Act with  respect to the  Transfer  of any  Warrant  or any  Warrant
Shares.  Holder,  by  acceptance  of this  Warrant,  agrees  to be  bound by the
provisions of this Section 9 and the Holdback Agreement.

(a) Restrictive Legend. In addition to the Transfer restriction set forth herein
and in the  Holdback  Agreement,  the Holder by  accepting  this Warrant and any
Warrant  Shares and  Exchange  Shares  agrees that unless  registered  under the
Securities Act, this Warrant, the Warrant Shares and the Exchange Shares may not
be  assigned  or  otherwise  transferred  unless and until (i) the  Company  has
received an opinion of counsel  for the Holder  reasonably  satisfactory  to the
Company  and  its  counsel  that  such  securities  may be sold  pursuant  to an
exemption from  registration  under the  Securities  Act, or (ii) a Registration
Statement relating to such securities has been filed by the Company and declared
effective by the Commission.

(b)         Each certificate for Warrant Shares shall bear a legend as
follows:

                  "These   securities  have  not  been   registered   under  the
            Securities Act of 1933, as amended (the  "Securities  Act"),  or the
            securities  laws  of any  state,  and are  being  offered  and  sold
            pursuant to an exemption from the  registration  requirements of the
            Securities  Act and such laws.  These  securities may not be sold or
            transferred except pursuant to an effective  registration  statement
            under the Securities Act or pursuant to an available  exemption from
            the  registration  requirements  of the Securities Act or such other
            laws."

<PAGE>

(c) Each  certificate for Exchange  Shares and, upon exchange,  shares of Common
Stock acquired  pursuant to the Subscription  Agreement,  shall bear a legend as
follows:

                  "These   securities  have  not  been   registered   under  the
            Securities Act of 1933, as amended (the  "Securities  Act"),  or the
            securities  laws  of any  state,  and are  being  offered  and  sold
            pursuant to an exemption from the  registration  requirements of the
            Securities  Act and such laws.  These  securities may not be sold or
            transferred except pursuant to an effective  registration  statement
            under the Securities Act or pursuant to an available  exemption from
            the  registration  requirements  of the Securities Act or such other
            laws.

                  This certificate is subject to, and is transferable  only upon
            compliance with, the provisions of a Holdback  Agreement dated as of
            ____________,  2000,  by and  between  the Company and the Holder of
            this   certificate.   Any  direct  or  indirect  transfer  or  other
            disposition  or  encumbrance  of  the  shares  represented  by  this
            certificate in violation of the Holdback Agreement shall be invalid.
            A copy of the above-referenced  Holdback Agreement is in file at the
            offices of the Company."

(d) Except as otherwise provided in this Section 9, the Warrant shall be stamped
or otherwise imprinted with a legend in substantially the following form:

                  "THIS  COMMON  STOCK  PURCHASE   WARRANT  AND  THE  SECURITIES
            REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
            OF 1933, AS AMENDED, AND MAY NOT BE TRANSFERRED IN VIOLATION OF SUCH
            ACT, THE RULES AND REGULATIONS  THEREUNDER OR THE PROVISIONS OF THIS
            COMMON  STOCK  PURCHASE  WARRANT  AND ARE  SUBJECT TO CERTAIN  OTHER
            TRANSFER  RESTRICTIONS SET FORTH IN THE HOLDBACK  AGREEMENT  ANNEXED
            HERETO."

9.2 Notice of Proposed Transfers. Prior to any Transfer or attempted Transfer of
any Warrants, Warrant Shares, Exchange Shares or any shares of Restricted Common
Stock,  the Holder shall give ten (10) Business  Days,  prior written  notice (a
"Transfer  Notice") to the Company  and its  counsel of  Holder's  intention  to
effect such Transfer,  describing the manner and  circumstances  of the proposed
Transfer,  and obtain (i) in the case of a Transfer of this  Warrant or Exchange
Shares, the prior written consent of the Company, which may be given in the sole
discretion  of the  Company,  and (ii) in the case of a Transfer of any Warrants
Shares  or  Restricted  Common  Stock,  from  counsel  to  Holder  who  shall be
reasonably satisfactory to the Company, an opinion that the proposed Transfer of
such Warrant,  Warrant Shares or Restricted Common Stock may be effected without
registration  under the Securities Act. After receipt of the Transfer Notice and
opinion,  the Company shall,  within five (5) Business Days thereof,  notify the
Holder as to whether such opinion is reasonably  satisfactory and, in the case a
Transfer of any Warrants,  whether the Company has consented thereto, and if so,
such holder  shall  thereupon  be entitled  to  Transfer  such  Warrants or such
Restricted  Common Stock, in accordance  with the terms of the Transfer  Notice,
the Warrant and the Holdback  Agreement.  Each certificate,  if any,  evidencing
such shares of Restricted  Common Stock issued upon such Transfer shall bear the
restrictive legends set forth in Section 9.1(b) and (c), as applicable,  and the
Warrant issued upon such Transfer shall bear the restrictive legend set forth in
Section  9.1(d),  unless  in the  opinion  of such  counsel  such  legend is not
required in order to ensure compliance with the Securities Act.

9.3 Termination of  Restrictions.  Notwithstanding  the foregoing  provisions of
Section 9, the restrictions  imposed by this Section upon the transferability of
the Warrants,  the Warrant Shares, the Exchange Shares and any Restricted Common
Stock and the legend  requirements  of  Section  9.1 shall  terminate  as to any
particular  Warrant or share of Warrant  Shares,  Exchange  Shares or Restricted
Common Stock (i) when and so long as such security  shall have been  effectively
registered  under the Securities Act and disposed of pursuant  thereto,  or (ii)
when  the  Company  shall  have  received  an  opinion  of  counsel   reasonably
satisfactory  to it and its counsel that such shares may be transferred  without
registration  thereof under the  Securities  Act, and (iii) when such  Warrants,
Warrant  Shares,  Exchange  Shares  and any  Restricted  Common  Stock no longer
contains any Transfer  restrictions  pursuant to this Warrant,  the Subscription
Agreement  and the  Holdback  Agreement.  Whenever the  restrictions  imposed by
Section 9 shall  terminate as to a this Warrant,  as hereinabove  provided,  the
Holder hereof shall be entitled to receive from the Company upon written request
of the  Holder,  at the  expense  of the  Company,  a new  Warrant  bearing  the
following legend in place of the restrictive legend set forth hereon:

            "THE RESTRICTIONS ON TRANSFERABILITY OF THE WITHIN WARRANT CONTAINED
            IN SECTION 9 HEREOF  TERMINATED ON , AND ARE OF NO FURTHER FORCE AND
            EFFECT."

All Warrants issued upon  registration of transfer,  division or combination of,
or in  substitution  for,  any Warrant or Warrants  entitled to bear such legend
shall have a similar legend endorsed thereon.  Whenever the restrictions imposed
by this Section shall  terminate as to any share of Restricted  Common Stock, as
hereinabove  provided,  the holder thereof shall be entitled to receive from the
Company,  at the Company's expense,  a new certificate  representing such Common
Stock not  bearing  the  restrictive  legends  set forth in  Section  9.1(b) and
Section 9.1(c), as the case may be.

9.4 Listing on  Securities  Exchange.  If the  Company  shall list any shares of
Common Stock on any securities exchange,  it will, at its expense, list thereon,
maintain  and,  when  necessary,  increase such listing of, all shares of Common
Stock  issued  or, to the extent  permissible  under the  applicable  securities
exchange  rules,  issuable upon the exercise or exchange of this Warrant so long
as any shares of Common Stock shall be so listed during any such Exercise Period
or Exchange Period.

10.         SUPPLYING INFORMATION

      The Company shall  cooperate with Holder in supplying such  information as
may be  reasonably  necessary  for Holder to complete  and file any  information
reporting forms presently or hereafter required by the Commission as a condition
to the  availability of an exemption from the Securities Act for the sale of any
Warrant or Restricted Common Stock.

11.         LOSS OR MUTILATION

      Upon   receipt  by  the  Company   from  Holder  of  evidence   reasonably
satisfactory  to it of the  ownership  of and the loss,  theft,  destruction  or
mutilation of this Warrant and indemnity reasonably satisfactory to it (it being
understood  that  the  written  agreement  of the  Holder  shall  be  sufficient
indemnity),  and in case of mutilation upon surrender and  cancellation  hereof,
the Company  will execute and deliver in lieu hereof a new Warrant of like tenor
to Holder;  provided, in the case of mutilation,  no indemnity shall be required
if  this  Warrant  in  identifiable  form  is  surrendered  to the  Company  for
cancellation.

12.         OFFICE OF THE COMPANY

      As long as any of the  Warrants  remain  outstanding,  the  Company  shall
maintain an office or agency  (which may be the principal  executive  offices of
the Company) where the Warrants may be presented for exercise,  registration  of
transfer, division or combination as provided in this Warrant.

13.         LIMITATION OF LIABILITY

      No provision  hereof,  in the absence of  affirmative  action by Holder to
purchase  shares of Common  Stock,  and no  enumeration  herein of the rights or
privileges of Holder hereof,  shall give rise to any liability of Holder for the
purchase price of any Common Stock or as a stockholder  of the Company,  whether
such liability is asserted by the Company or by creditors of the Company.

14.         MISCELLANEOUS

14.1  Nonwaiver  and  Expenses.  No course of dealing or any delay or failure to
exercise any right  hereunder on the part of Holder shall operate as a waiver of
such right or otherwise  prejudice Holder's rights,  powers or remedies.  If the
Company fails to make, when due, any payments  provided for hereunder,  or fails
to comply with any other  provision of this  Warrant,  the Company  shall pay to
Holder such amounts as shall be  sufficient  to cover any  reasonable  costs and
expenses including,  but not limited to, reasonable  attorneys' fees,  including
those of appellate proceedings, incurred by Holder in collecting any amounts due
pursuant hereto or in otherwise enforcing any of its rights,  powers or remedies
hereunder.

14.2 Notice Generally. Except as may be otherwise provided herein, any notice or
other  communication  or delivery  required or permitted  hereunder  shall be in
writing and shall be sent by facsimile with a copy delivered  personally or sent
by a nationally  recognized overnight courier service, and shall be deemed given
when so delivered personally or by overnight courier service, as follows:

<PAGE>

(1)         if to the Company, to:

WORLD DIAGNOSTICS, INC.
15271 NW 60th Avenue,
Miami Lakes, Florida 33014
Attention:  Ken Peters
Telephone:  (305) 827-3304
Facsimile:  (305) 827-3304

With a copy to:

Herrick, Feinstein LLP
2 Park Avenue,
New York, New York 10016
Attention:  Craig R. Parker, Esq.
Telephone:  (212) 592-1400
Facsimile:  (212) 592-1500

(2)       if to the Holder, to:

--------------------------
-----------------------
--------------------------
Attention:
Telephone: _________________
Facsimile:  _________________

<PAGE>

The  Company or the Holder may  change  the  foregoing  address by notice  given
pursuant to this Section 14.2.

14.3  Indemnification.  (a) The Company  agrees to indemnify  and hold  harmless
Holder  from  and  against  any  liabilities,   obligations,   losses,  damages,
penalties,  actions,  judgments, suits, claims, costs, attorneys' fees, expenses
and disbursements of any kind which may be imposed upon, incurred by or asserted
against  Holder in any manner  relating  to or arising out of any failure by the
Company to perform or observe  in any  material  respect  any of its  covenants,
agreements,  undertakings  or obligations  set forth in this Warrant;  provided,
however,  that the Company  will not be liable  hereunder to the extent that any
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims,  costs,  attorneys' fees, expenses or disbursements are found in a final
non-appealable  judgment  by a  court  to  have  resulted  from  Holder's  gross
negligence,  bad faith or willful misconduct in its capacity as a stockholder or
warrant holder of the Company.

             (a) The Holder  agrees to indemnify  and hold  harmless the Company
from and against  any  liabilities,  obligations,  losses,  damages,  penalties,
actions,   judgments,  suits,  claims,  costs,  attorneys'  fees,  expenses  and
disbursements  of any kind which may be imposed  upon,  incurred  by or asserted
against the  Company in any manner  relating to or arising out of any failure by
the Holder to perform or observe in any material  respect any of its  covenants,
agreements,  undertakings  or obligations  set forth in this Warrant;  provided,
however,  that the Holder  will not be liable  hereunder  to the extent that any
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims,  costs,  attorneys' fees, expenses or disbursements are found in a final
non-appealable  judgment by a court to have resulted  from the  Company's  gross
negligence, bad faith or willful misconduct.

14.4 Remedies.  The Company and Holder in addition to being entitled to exercise
all rights granted by law,  including  recovery of damages,  will be entitled to
specific  performance of its rights under Section 9 of this Warrant. The Company
and Holder agree that monetary  damages would not be adequate  compensation  for
any loss incurred by reason of a breach by it of the  provisions of Section 9 of
this  Warrant and hereby  agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.

14.5  Successors  and Assigns.  Subject to the provisions of Sections 3.1 and 9,
this Warrant and the rights  evidenced  hereby shall inure to the benefit of and
be binding upon the  successors of the Company and the permitted  successors and
assigns of Holder.  The  provisions  of this  Warrant are intended to be for the
benefit of all Holders from time to time of this  Warrant  and,  with respect to
Section 9 hereof,  holders of Warrant Shares and Exchange  Shares,  and shall be
enforceable by any such Holder or holder of such Shares.

14.6      Amendment.  This Warrant and all other Warrants may be modified or
amended or the provisions hereof waived with the written consent of the
Company and the Holder.

14.7 Severability.  Wherever  possible,  each provision of this Warrant shall be
interpreted  in such manner as to be effective and valid under  applicable  law,
but if any  provision of this Warrant  shall be  prohibited  by or invalid under
applicable  law,  such  provision  shall be  ineffective  to the  extent of such
prohibition or invalidity,  without invalidating the remainder of such provision
or the remaining provisions of this Warrant.

14.8  Headings.  The headings  used in this Warrant are for the  convenience  of
reference only and shall not, for any purpose, be deemed a part of this Warrant.

14.9

<PAGE>

          Governing Law.  This Warrant shall be governed by the laws of the
State of Delaware, without regard to the provisions thereof relating to
conflict of laws.

          IN WITNESS  WHEREOF,  the Company  has caused this  Warrant to be duly
executed  and its  corporate  seal to be  impressed  hereon and  attested by its
Secretary or an Assistant Secretary.

Dated:    ____________, 2000

<PAGE>

THE COMPANY:
-----------

WORLD DIAGNOSTICS, INC.

By:

<PAGE>

[SEAL]

<PAGE>

                                    EXHIBIT A

                                SUBSCRIPTION FORM

                [To be executed only upon exercise of Warrant]

            The  undersigned   registered  owner  of  this  Warrant  irrevocably
exercises  this  warrant  for the  purchase  of Shares of Common  Stock of World
Diagnostics,  Inc. and herewith makes payment therefor,  all at the price and on
the  terms  and   conditions   specified  in  this  Warrant  and  requests  that
certificates for the shares of Common Stock hereby purchased (and any securities
or other  property  issuable  upon such  exercise)  be issued in the name of and
delivered to

whose  address is and, if such  shares of Common  Stock shall not include all of
the shares of Common  Stock  issuable as provided  in this  Warrant,  that a new
Warrant  of like tenor and date for the  balance  of the shares of Common  Stock
issuable hereunder be delivered to the undersigned.

<PAGE>

(Name of Registered Owner)

(Signature of Registered Owner)

(Street Address)

(City)                             (State)      (Zip Code)

<PAGE>

      NOTICE: The signature on this  subscription  must correspond with the name
            as written upon the face of the within Warrant in every  particular,
            without alteration or enlargement or any change whatsoever.

<PAGE>

                                    EXHIBIT B

                             NOTICE OF EXCHANGE FORM

                [To be executed only upon exchange of Warrant]

                              The undersigned registered owner of this
Warrant irrevocably exercises its right to exchange _____ Warrants for Shares of
Common Stock of World Diagnostics, Inc. on the terms and conditions specified in
this  Warrant and  requests  that  certificates  for the shares of Common  Stock
hereby  exchanges for (and any securities or other  property  issuable upon such
exchange)  be issued in the name of and  delivered to Holder and, if such shares
of Common Stock shall not include all of the shares of Common Stock  issuable as
provided  in this  Warrant,  that a new  Warrant  of like tenor and date for the
balance of the shares of Common  Stock  issuable  hereunder  be delivered to the
undersigned.

<PAGE>

(Name of Registered Owner)

(Signature of Registered Owner)

(Street Address)

(City)                             (State)      (Zip Code)

<PAGE>

      NOTICE:           The signature on this notice must correspond with the
            name as written upon the face of the within Warrant in every
            particular, without alteration or enlargement or any change
            whatsoever.[To be executed only upon exchange of Warrant]

<PAGE>

                                    EXHIBIT C

                                 ASSIGNMENT FORM

                              FOR VALUE RECEIVED the undersigned registered
owner of this Warrant  hereby  sells,  assigns and  transfers  unto the Assignee
named  below all of the  rights of the  undersigned  under  this  Warrant,  with
respect to the number of shares of Common Stock set forth below:

Name and Address of Assignee                          No. of Shares of
----------------------------                          --------------

Common Stock

and does hereby irrevocably constitute and appoint
attorney-in-fact to register such transfer on the books of
maintained for the purpose, with full power of substitution in the premises.

Dated:                                                             Print Name:
            ------------------

                                   Signature:

                                    Witness:

<PAGE>

      NOTICE: The signature on this  assignment must correspond with the name as
            written  upon the face of the within  Warrant  in every  particular,
            without alteration or enlargement or any change whatsoever.

<PAGE>

                                    EXHIBIT D

                               HOLDBACK AGREEMENT

                                             , 2000

World Diagnostics, Inc.
15271 NW 60th Avenue,
Miami Lakes, Florida 33014

                        Re: Holdback Agreement (this "Agreement")
                            -------------------------------------

Gentlemen:

         The  undersigned  hereby  agrees and  acknowledges,  for the benefit of
World  Diagnostics,  Inc. (the "Company") and its successors and assigns and the
holders  of the  Company's  Common  Stock,  par value  $.001 per share  ("Common
Stock"), and other securities that:

         1. The undersigned is the record and beneficial  owner of (i) shares of
Common Stock,  and (ii) Warrants (the  "Warrants") of the Company dated the date
hereof to purchase or otherwise  acquire  Common Stock,  both of which have been
issued to the undersigned by the Company for valid  consideration  pursuant to a
Subscription  Agreement dated the date hereof by and between the Company and the
undersigned.

         2. Unless otherwise defined herein,  capitalized terms used herein have
the meanings ascribed to them in the Warrants.

         3. Effective  upon the  date (the  "Effective  Date")  the  undersigned
exercises its exchange  right set forth in Section 2.2 of the Warrants  (without
any  further  action on behalf of the  Company or the  undersigned),  during the
period commencing on the Effective Date and ending on the date which is eighteen
(18) months from the Effective Date (the "Termination Date"):

                  (a)   the undersigned  shall not sell,  transfer,  encumber,
                  pledge or otherwise  dispose of any Common Stock or Exchange
                  Shares; and

                   (b) neither the undersigned,  any of its affiliates,  nor any
                  person  acting  on its or their  behalf,  shall,  directly  or
                  indirectly, at any time prior to the Termination Date:

                         (i) enter into any put option, short position or engage
                        in any trading activities, hedging transactions or other
                        activities  with respect to the Common Stock or other of
                        the  Company's   securities  that  could  reasonably  be
                        expected  to  influence  the market  price of the Common
                        Stock or such other securities; or

                         (ii) sell the Common Stock or the Exchange  Shares in a
                        transaction  that is  effected at a price which is lower
                        than the  quoted  bid price of the  Common  Stock at the
                        time of sale.

      4. Following the Termination  Date,  neither the  undersigned,  any of its
affiliates,  nor any person  acting on its or their behalf,  shall,  directly or
indirectly, sell, during a calendar month within the first four months after the
Termination  Date,  a number of shares of Common  Stock  which is  greater  than
twenty five percent (25%) of, in the  aggregate,  the number of shares of Common
Stock  and  Exchange  Shares  acquired  by  the  undersigned   pursuant  to  the
Subscription  Agreement and Warrants,  in both cases as such number of shares of
Common  Stock and Exchange  shares may be adjusted  pursuant to the terms of the
subscription Agreement and Warrants.

      5.  Notwithstanding  anything to the contrary herein, the restrictions set
forth in this Agreement shall  terminate in their  entirety,  and shall be of no
force or effect, if the Company shall sell, transfer or otherwise dispose of all
or  substantially  all of its  property,  assets or  business,  whether by sale,
consolidation  or merger with or into another  entity  (where the Company or its
affiliate is not the surviving corporation) or otherwise.

      6. The undersigned  recognizes and  acknowledges  that Company has entered
into the  Subscription  Agreement and issued the Warrants to the  undersigned in
consideration  of the  undersigned's  entering  into  this  Agreement;  that the
Company is a new development stage technology Company in need of a stable market
for its  Common  Stock;  and that the Common  Stock is  subject  to  volatility.
Accordingly,  in the event of a breach or default by one or more of the  parties
hereto of the terms and conditions of this Agreement, the damages to the Company
may be impossible  to ascertain and it will not have an adequate  remedy at law.
In the event of any such breach or default in the  performance  of the terms and
provisions of this Agreement,  any party aggrieved  thereby shall be entitled to
institute and prosecute proceedings,  either at law or in equity, to enforce the
specific  performance of the terms and provisions of this  Agreement,  to enjoin
further  violations  of the terms and  provisions  of this  Agreement  and/or to
obtain damages.  Such remedies shall,  however,  be cumulative and not exclusive
and shall be in  addition to any other  remedies  which any party may have under
this Agreement or at law.

      7. This  Agreement  shall be governed  by and  construed  and  enforced in
accordance  with  the laws of the  State  of New  York,  without  regard  to the
conflicts of law doctrine of such state. All actions against the parties to this
Agreement  arising  under  or  relating  to  this  Agreement  shall  be  brought
exclusively in the appropriate federal court in the County of New York, State of
New York.  Each of the parties hereto agrees to submit to personal  jurisdiction
and to waive any  objection as to venue in the County of New York,  State of New
York.  Service of process on any party  hereto in any action  arising  out of or
relating to this  Agreement  shall be  effective  if mailed to such party as set
forth in the Subscription.

<PAGE>

      8. This  Agreement  shall be binding  upon and inure to the benefit of the
parties hereto and their respective permitted successors and assigns, and if the
undersigned is an individual, to his or her heirs and legal representatives.

      9.  If  any  provision  of  this  Agreement   shall  be  held  invalid  or
unenforceable,  such  invalidity or  unenforceability  shall attach only to such
provision and only to the extent such  provision  shall be held to be invalid or
unenforceable  and shall not in any way affect the validity or  enforceablity of
the  other  provisions  hereof,  all of which  provisions  are  hereby  declared
severable,  and this letter agreement shall be carried out as if such invalid or
unenforceable provision or portion thereof was not embodied herein.

      10.  Neither this  Agreement  nor any  provisions  hereof shall be waived,
modified, discharged, or terminated except by an instrument in writing signed by
the party against whom any such waiver, modification,  discharge, or termination
is sought.

      11.  This  Agreement  is being  delivered  to you in  triplicate.  If this
Agreement accurately reflects our understanding,  please sign all copies of this
Agreement in the space provided below,  and return one fully executed  Agreement
to my attention upon acceptance of my subscription  pursuant to the Subscription
Agreement,  whereupon  this  Agreement  shall  become a legal  obligation.  This
Agreement  may be executed in  counterparts,  each of which shall  constitute an
integral part of one and the same original Agreement.

                                Sincerely yours,

                              By: ___________________
                                      Name:

Acknowledged and Agreed:

World Diagnostics, Inc.

By: ___________________________
    Name:
       Title:<PAGE>

                            NETSOLVE, INCORPORATED

                             AMENDED AND RESTATED

                     LONG-TERM INCENTIVE COMPENSATION PLAN

Section 1.  Purpose

     NetSolve, Incorporated, a Delaware corporation (the "Company"), hereby
establishes the NetSolve, Incorporated Long-Term Incentive Compensation Plan
(the "Plan") to promote the interests of the Company and its stockholders
through the (i) attraction and retention of executive officers and other key
employees of the Company, as well as directors and other consultants who are
essential to the success of the Company; (ii) motivation of executive officers
and other key employees using performance-related incentives linked to long-
range performance goals and the interests of Company stockholders; and (iii)
enabling of such employees to share in the long-term growth and success of the
Company.  The Plan permits the grant of Incentive Stock Options (intended to
qualify under Section 422 of the Code), Nonqualified Stock Options, Stock
Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance
Shares, Performance Units, Bonus Stock, and any other Stock Unit Awards or
stock-based forms of awards as the Committee, in its sole and complete
discretion, may determine to be appropriate in carrying out the intent and
purposes of this Plan.

Section 2.  Definitions

     When used in this Plan, the following terms shall have the meanings set
forth below:

     2.1  "Affiliate" shall have the meaning ascribed to such term in Rule 12b-2
          under the Exchange Act.

     2.2  "Agreement" means a written agreement between the Company and a
          Participant implementing and setting forth the particular terms,
          conditions and restrictions of each Award.  With respect to the grant
          of an Option, the Agreement may be referred to herein as an "Option
          Agreement," and with respect to any other Award hereunder, the
          Agreement may be referred to herein as an "Award Agreement."

     2.3  "Award" means a grant under the Plan of Incentive Stock Options,
          Nonqualified Stock Options, Stock Appreciation Rights, Restricted
          Stock, Restricted Stock Units, Performance Shares, Performance Units,
          Bonus Stock, or other Stock Unit Awards.

     2.4  "Award Date" or "Grant Date" means the date on which an Award is made
          by the Committee under the Plan.
<PAGE>

     2.5  "Beneficial Owner" shall have the meaning ascribed to such term in
          Rule 13d-3 under the Exchange Act.

     2.6  "Board" or "Board of Directors" means the Board of Directors of the
          Company.

     2.7  "Bonus Stock" means an Award granted pursuant to Section 10 of the
          Plan.

     2.8  "Change in Control" shall be deemed to have occurred if the conditions
          set forth in any one of the following paragraphs shall have been
          satisfied:

          (a)  Any person, corporation, entity or group, including any "group"
               as defined in Section 13(d)(3) of the Exchange Act (collectively
               "Person"), who, as of the effective of this Plan is unaffiliated
               with any current stockholder of the Company, becomes the
               beneficial owner of equity securities of the Company comprising
               20% or more of the total number of votes that may be cast for the
               election of directors of the Company; or

          (b)  As the result of, or in connection with, any tender or exchange
               offer, merger or other business combination, sale of assets, sale
               of securities, contested election, or any combination of the
               foregoing (a "Transaction"), the persons who were directors of
               the Company immediately before the Transaction shall cease to
               constitute a majority of the Board of Directors of the Company or
               any successor to the Company or its assets; or

          (c)  If at any time: (i) the Company shall consolidate or merge with
               any other Person and the Company shall not be the continuing or
               surviving entity; (ii) any Person shall consolidate or merge with
               the Company, and the Company shall be the continuing or surviving
               corporation and in connection therewith, all or part of the
               outstanding Common Stock shall be converted into, or exchanged
               for, stock or other securities of any other Person or cash or any
               other property; (iii) the Company shall be a party to a statutory
               share exchange with any other Person after which the Company is a
               subsidiary of any other Person; or (iv) the Company shall sell or
               otherwise transfer 50% or more of the assets or earning power of
               the Company and its Subsidiaries (taken as a whole) to any Person
               or Persons.

     2.9  "Code" means the Internal Revenue Code of 1986 and the rules and
          regulations promulgated thereunder, or any successor law, as amended
          from time to time.

     2.10 "Committee" means the Compensation Committee of the Board.

                                       2
<PAGE>

     2.11  "Common Stock" or "Stock" means the Common Stock of the Company, $.01
           par value per share, or such other security or right or instrument
           into which such Common Stock may be changed or converted in the
           future.

     2.12  "Company" means NetSolve, Incorporated, including all Affiliates and
           wholly-owned subsidiaries, or any successor thereto.

     2.13  "Covered Participant" means a Participant who is a "covered employee"
           as defined in Code Section 162(m)(3) and the regulations promulgated
           thereunder.

     2.14  "Designated Beneficiary" means the beneficiary designated by the
           Participant, pursuant to procedures established by the Committee, to
           receive amounts due to the Participant in the event of the
           Participant's death. If the Participant does not make an effective
           designation, then the Designated Beneficiary will be deemed to be the
           Participant's estate.

     2.15  "Disability" means the mental or physical disability of a Participant
           that precludes the Participant from engaging in any occupation or
           employment for wage or profit for at least twelve months and appears
           to be permanent, as determined by the Committee in its sole
           discretion.  All decisions by the Committee relating to a
           Participant's Disability (including a decision that a Participant is
           not disabled), shall be final and binding on all parties.

     2.16  "Divestiture" means the sale of, or closing by, the Company of the
           business operations in which the Participant is employed.

     2.17  "Exchange Act" means the Securities Exchange Act of 1934 and the
           rules and regulations promulgated thereunder, or any successor law as
           amended from time to time.

     2.18  "Executive Officer" means any employee considered by the Company to
           be an Executive Officer.

     2.19  "Fair Market Value" means the fair market value of the Stock as
           determined by the Committee using any reasonable valuation method.

     2.20  "Full-time Employee" means an individual who is employed by the
           Company or a Subsidiary in a customary employer-employee
           relationship, is on the payroll of the Company or such Subsidiary,
           receives compensation directly from the Company or such Subsidiary,
           and is designated in the internal payroll or other records of the
           Company or a Subsidiary as a regular, full-time employee. This
           designation excludes all leased employees (within the meaning of Code
           Section 414(n)), part-time

                                       3
<PAGE>

           employees, temporary employees, or contract employees, as well as all
           consultants to, the Company.

     2.21  "Incentive Stock Option" or "ISO" means an option to purchase Stock,
           granted under Section 6 herein, which is designated as an incentive
           stock option and is intended to meet the requirements of Code Section
           422.

     2.22  "Key Employee" means a Full-time Employee who is an officer or other
           key employee of the Company or its Subsidiaries as designated or
           determined by the Committee.

     2.23  "Nonqualified Stock Option" or "NQSO" means an option to purchase
           Stock, granted under Article 6 herein, which is not intended to
           qualify as, or constitute an Incentive Stock Option.

     2.24  "Option" means an Incentive Stock Option or a Nonqualified Stock
           Option.

     2.25  "Other Stock Unit Award" means awards of Stock or other Awards that
           are valued in whole or in part by reference to, or are otherwise
           based on, the value of the Company's Common Stock.

     2.26  "Participant" means a Key Employee or director of, or a consultant
           to, the Company who has been granted an Award under the Plan.

     2.27  "Performance Criteria" means the objectives established by the
           Committee for a Performance Period, for the purpose of determining
           when an Award subject to such objectives has been earned.

     2.28  "Performance Award" means a performance-based Award made under
           Section 9 herein, which may be in the form of either Performance
           Shares or Performance Units.

     2.29  "Performance Period" means the time period designated by the
           Committee during which performance goals must be met in order for a
           Participant to obtain a performance-based Award.

     2.30  "Performance Share" means an Award, designated as a Performance
           Share, granted to a Participant pursuant to Section 9 herein, the
           value of which is determined, in whole or in part, by the value of
           the Stock in a manner deemed appropriate by the Committee and
           described in the applicable Agreement.

     2.31  "Performance Unit" means an Award, designated as a Performance Unit,
           granted to a Participant pursuant to Section 9 herein, the value of
           which is determined, in whole

                                       4
<PAGE>

           or in part, by the attainment of pre-established Performance Criteria
           as deemed appropriate by the Committee and described in the
           Agreement.

     2.32  "Period of Restriction" means the period during which the transfer of
           Shares of Restricted Stock is restricted, pursuant to Section 8
           herein.

     2.33  "Person" shall have the meaning ascribed to such term in Section
           3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d)
           thereof, including a "group" as defined in Section 13(d).

     2.34  "Plan" means the NetSolve, Incorporated Long-Term Incentive
           Compensation Plan as herein established and as hereafter amended from
           time to time.

     2.35  "Restricted Stock" means an Award of Stock granted to a Participant
           pursuant to Section 8 herein.

     2.36  "Restricted Stock Unit" means a fixed or variable dollar denominated
           right to acquire Stock, which may or may not be subject to
           restrictions, contingently awarded under Section 8 of the Plan.

     2.37  "Rule 16b-3" means Rule 16b-3 under Section 16(b) of the Exchange Act
           as adopted in Exchange Act Release No. 34-37260 (May 30, 1996), or
           any successor rule as amended from time to time.

     2.38  "Section 162(m)" means Section 162(m) of the Code, or any successor
           section under the Code, as amended from time to time and as
           interpreted by final or proposed regulations promulgated thereunder
           from time to time.

     2.39  "Securities Act" means the Securities Act of 1933 and the rules and
           regulations promulgated thereunder, or any successor law, as amended
           from time to time.

     2.40  "Stock" or "Shares" means the Common Stock of the Company.

     2.41  "Stock Appreciation Right" means the right to receive an amount equal
           to the excess of the Fair Market Value of a share of Stock (as
           determined on the date of exercise) over the Exercise Price of a
           related Option or the Fair Market Value of the Stock on the Grant
           Date of the Stock Appreciation Right.

     2.42  "Stock Unit Award" means an award of Common Stock or units granted
           under Section 11.

                                       5
<PAGE>

    2.43   "Subsidiary" means a corporation in which the Company owns, either
           directly or through one or more of its Subsidiaries, at least 50% of
           the total combined voting power of all classes of stock.

Section 3. Administration

     3.1   The Committee.  The Plan shall be administered and interpreted by the
           -------------
Committee which shall have full authority, discretion and power necessary or
desirable for such administration and interpretation.  The express grant in this
Plan of any specific power to the Committee shall not be construed as limiting
any power or authority of the Committee.  In its sole and complete discretion
the Committee may adopt, alter, suspend and repeal any such administrative
rules, regulations, guidelines, and practices governing the operation of the
Plan as it shall from time to time deem advisable.  In addition to any other
powers and, subject to the provisions of the Plan, the Committee shall have the
following specific powers: (i) to determine the terms and conditions upon which
Awards may be made and exercised; (ii) to determine the Participants to which
Awards shall be made; (iii) to determine all terms and provisions of each
Agreement, which need not be identical for types of Awards nor for the same type
of Award to different Participants; (iv) to construe and interpret all terms,
conditions and provisions of the Plan and all Agreements; (v) to establish,
amend, or waive rules or regulations for the Plan's administration; (vi) to
accelerate the exercisability of any Award, the length of a Performance Period
or the termination of any Period of Restriction; and (vii) to make all other
determinations and take all other actions necessary or advisable for the
administration or interpretation of the Plan.  The Committee may seek the
assistance or advice of any persons it deems necessary to the proper
administration of the Plan.

     3.2   Committee Decisions.  Unless strictly and expressly prohibited by
           -------------------
law, all determinations and decisions made by the Committee pursuant to the
provisions of this Plan shall be final, conclusive, and binding upon all
persons, including Participants, Designated Beneficiaries, the Company, its
stockholders and employees.

Section 4. Eligibility

     The Committee shall have sole and complete discretion in designating and
determining Participants in the Plan.

Section 5. Shares Subject to the Plan

     5.1   Number of Shares.  Subject to adjustment as provided for in Section
           ----------------
5.4 below, the maximum aggregate number of Shares that may be issued pursuant to
Awards made under the Plan shall not exceed 4,350,000 Shares, which may be in
any combination of Options, Restricted Stock, Restricted Stock Units,
Performance Shares, Bonus Shares, or Other Stock Unit Award.  Shares of Common
Stock may be available from the authorized but unissued Shares, Shares issued
and reacquired by the Company or Shares purchased in the open market for
purposes of the Plan.  Except as provided in Sections 5.2 and 5.3 herein, the
issuance of Shares in connection with the exercise of,

                                       6
<PAGE>

or as other payment for, Awards under the Plan shall reduce the number of Shares
available for future Awards under the Plan.

     5.2  Lapsed Awards or Forfeited Shares.  In the event that: (i) any Option
          ---------------------------------
or other Award granted under the Plan terminates, expires, or lapses for any
reason without having been exercised in accordance with its terms;  (ii) Shares
issued pursuant to the Awards are canceled or forfeited for any reason; or (iii)
Awards are paid in cash, the Shares subject to such Award shall thereafter be
again available for grant of an Award under the Plan.

     5.3  Delivery of Shares as Payment.  In the event a Participant pays for
          -----------------------------
any Option or other Award granted under the Plan through the delivery of
previously acquired shares of Common Stock, the number of shares of Common Stock
available for Awards under the Plan shall be increased by the number of shares
surrendered by the Participant.

     5.4  Capital Adjustments.  The number and class of Shares subject to each
          -------------------
outstanding Award, the Option Price and the aggregate number, type and class of
Shares for which Awards thereafter may be made shall be subject to adjustment,
if any, as the Committee deems appropriate, based on the occurrence of a number
of specified and non-specified events.  Such specified events are discussed in
this Section 5.4, but such discussion is not intended to provide an exhaustive
list of such events which may necessitate adjustments.

     (a)  If the outstanding Shares are increased, decreased or exchanged
          through merger, consolidation, sale of all or substantially all of the
          property of the Company, reorganization, recapitalization,
          reclassification, stock dividend, stock split, reverse stock split or
          other distribution in respect to such Shares, for a different number
          or type of Shares, or if additional Shares or new or different Shares
          are distributed with respect to such Shares, an appropriate and
          proportionate adjustment shall be made in: (i) the maximum number of
          shares of Stock available for the Plan as provided in Section 5.1
          herein; (ii) the type of shares or other securities available for the
          Plan; (iii) the number of shares of Stock subject to any then
          outstanding Awards under the Plan; and (iv) the price (including
          Exercise Price) for each share of Stock (or other kind of shares or
          securities) subject to then outstanding Awards, but without change in
          the aggregate purchase price as to which such Options remain
          exercisable or Restricted Stock releasable.

     (b)  In the event other events not specified above in this Section 5.4,
          such as any extraordinary cash dividend, split-up, reverse split,
          spin-off, combination, exchange of shares, warrants or rights offering
          to purchase Common Stock, or other similar corporate event, affect the
          Common Stock such that an adjustment is necessary to maintain the
          benefits or potential benefits intended to be provided under this
          Plan, then the Committee in its discretion may make adjustments to any
          or all of: (i) the number and type of shares which thereafter may be
          optioned and sold or awarded or made subject to Stock Appreciation
          Rights under the Plan; (ii) the grant, exercise or

                                       7
<PAGE>

           conversion price of any Award made under the Plan thereafter; and
           (iii) the number and price (including Exercise Price) of each share
           of Stock (or other kind of shares or securities) subject to the then
           outstanding Awards.

     (c)   Any adjustment made by the Committee pursuant to the provisions of
           this Section 5.4 shall be final, binding and conclusive. A notice of
           such adjustment, including identification of the event causing such
           adjustment, the calculation method of such adjustment, and the change
           in price and the number of shares of Stock, or securities, cash or
           property purchasable subject to each Award shall be sent to each
           Participant. No fractional interests shall be issued under the Plan
           based on such adjustments.

Section 6. Stock Options

     6.1   Grant of Stock Options.  Subject to the terms and provisions of the
           ----------------------
Plan and applicable law, the Committee, at any time and from time to time, may
grant Options to Key Employees as it shall determine.  The Committee shall have
sole and complete discretion in determining the type of Option granted, the
Option Price (as hereinafter defined), the duration of the Option, the number of
Shares to which an Option pertains, any conditions imposed upon the
exercisability or the transferability of the Options, including vesting
conditions, the conditions under which the Option may be terminated, and any
such other provisions as may be warranted to comply with the law or rules of any
securities trading system or stock exchange.  Each Option grant shall have such
specified terms and conditions detailed in an Option Agreement.  The Option
Agreement shall specify whether the Option is intended to be an Incentive Stock
Option or a Nonqualified Stock Option.

     6.2   Option Price.  The exercise price per share of Stock covered by an
           ------------
Option ("Option Price") shall be determined on the Grant Date by the Committee;
provided that the Option Price of an Option intended to constitute an Incentive
Stock Option shall not be less than 100% of the Fair Market Value of the Common
Stock on the Grant Date.

     6.3   Exercisability.  Options granted under the Plan shall be exercisable
           --------------
at such times and be subject to such restrictions and conditions as the
Committee shall determine, which will be specified in the Option Agreement and
need not be the same for each Participant.  However, no Option granted under the
Plan may be exercisable after the expiration of ten years from the Grant Date.

     6.4   Method of Exercise.  Options shall be exercised by the delivery of a
           ------------------
written notice from the Participant to the Company in a form prescribed by the
Committee setting forth the number of Shares with respect to which the Option is
to be exercised, accompanied by full payment or provision for full payment for
the Shares.  The Option Price shall be payable to the Company in full in cash,
or its equivalent, or by delivery of Shares of Stock (not subject to any
security interest or pledge) having a Fair Market Value at the time of exercise
equal to the exercise price of the Shares, or by a combination of the foregoing.
As soon as practicable, after receipt of written notice and full

                                       8
<PAGE>

payment of the Option Price, the Company shall deliver to the Participant a
stock certificate, issued in the Participant's name, evidencing the number of
Shares with respect to which the Option was exercised.

Section 7. Stock Appreciation Rights

     7.1   Grant of Stock Appreciation Rights.  Subject to the terms and
           ----------------------------------
provisions of the Plan and applicable law, the Committee, at any time and from
time to time, may grant freestanding Stock Appreciation Rights, Stock
Appreciation Rights in tandem with an Option, or Stock Appreciation Rights in
addition to an Option.  Stock Appreciation Rights granted in tandem with an
Option or in addition to an Option may be granted at the time of the Option or
at a later time.  No Stock Appreciation Rights granted under the Plan may be
exercisable after the expiration of ten years from the Grant Date.

     7.2   Price.  The exercise price of each Stock Appreciation Right shall be
           -----
determined at the time of grant by the Committee, subject to the limitation that
the grant price shall not be less than 100% of Fair Market Value of the Common
Stock on the Grant Date.

     7.3   Exercise.  Stock Appreciation Rights shall be exercised by the
           --------
delivery of a written notice from the Participant to the Company in a form
prescribed by the Committee.  Upon such exercise, the Participant shall be
entitled to receive an amount equal to the excess of the Fair Market Value of a
Share over the grant price thereof on the date of exercise of the Stock
Appreciation Right multiplied by the number of Shares for which the Stock
Appreciation Right was granted.

     7.4   Payment.  Payment upon exercise of the Stock Appreciation Right shall
           -------
be in the amount of the full exercise price therefor, and shall be made in the
form of cash, cash installments, Shares of Common Stock, or a combination
thereof, as determined in the sole and complete discretion of the Committee.
However, if any payment in the form of Shares results in a fractional share,
such payment for the fractional share shall be made in cash.

Section 8. Restricted Stock and Restricted Stock Units

     8.1   Grant of Restricted Stock.  Subject to the terms and provisions of
           -------------------------
the Plan and applicable law, the Committee, at any time and from time to time,
may grant shares of Restricted Stock and Restricted Stock Units under the Plan
to such Participants, and in such amounts and for such duration and/or
consideration as it shall determine.

     8.2   Restricted Stock Award Agreement.  Each Restricted Stock and
           --------------------------------
Restricted Stock Unit granted hereunder shall be evidenced by an Award Agreement
that shall specify the Period of Restriction, the conditions which must be
satisfied prior to removal of the restriction, the number of Shares of
Restricted Stock or Restricted Stock Units granted, payment terms for each such
Award (e.g. whether the Award will be paid in shares of Stock, cash or a
combination thereof, and whether payment will be in a lump sum or installments),
and such other provisions as the Committee shall

                                       9
<PAGE>

determine. The Committee may specify, but is not limited to, the following types
of restrictions in the Award Agreement: (i) restrictions on acceleration or
achievement of terms or vesting based on any Performance Criteria, including,
but not limited to, absolute or relative increases in total shareholder return,
revenues, sales, net income, or net worth of the Company, any of its
Subsidiaries, divisions, business units or other areas of the Company; and (ii)
any other restrictions which the Committee may deem advisable, including
requirements established pursuant to the Securities Act, the Exchange Act, the
Code and, if applicable, any securities trading system or stock exchange upon
which such Shares under the Plan may be listed.

     8.3   Nontransferability.  Except as provided in this Section 8, the Shares
           ------------------
of Restricted Stock or Restricted Stock Units granted under the Plan may not be
sold, transferred, pledged, assigned, or otherwise alienated or hypothecated
until the termination of the applicable Period of Restriction or upon earlier
satisfaction of other conditions as specified by the Committee in its sole
discretion and set forth in the applicable Award Agreement.  All rights with
respect to the Restricted Stock and Restricted Stock Units granted to a
Participant under the Plan shall be exercisable during his or her lifetime only
by such Participant or his or her guardian or legal representative.

     8.4   Removal of Restrictions.  Except as otherwise noted in this Section
           -----------------------
8, Restricted Stock and Restricted Stock Units covered by each Award made under
the Plan shall become freely transferable by the Participant after the last day
of the Period of Restriction and/or upon the satisfaction of other conditions as
determined by the Committee.

     8.5   Voting Rights.  During the Period of Restriction, Participants in
           -------------
whose name Restricted Stock is granted under the Plan may exercise full voting
rights with respect to those shares.

     8.6   Dividends and Other Distributions.  During the Period of Restriction,
           ---------------------------------
Participants in whose name Restricted Stock is granted under the Plan shall be
entitled to receive all dividends and other distributions paid with respect to
those Shares.  If any such dividends or distributions are paid in Shares, the
Shares shall be subject to the same restrictions on transferability and
forfeitability as the Restricted Stock with respect to which they were
distributed.

Section 9. Performance Awards

     9.1   Grant of Performance Awards.  Subject to the terms and provisions of
           ---------------------------
the Plan and applicable law, the Committee, at any time and from time to time,
may issue Performance Awards in the form of either Performance Shares or
Performance Units to Participants subject to the Performance Criteria,
Performance Period and other consideration or restrictions as it shall
determine.  The Committee shall have complete discretion in determining the
number and value of Performance Units or Performance Shares granted to each
Participant.

     9.2   Value of Performance Awards.  The Committee shall determine the
           ---------------------------
number and value of Performance Units or Performance Shares granted to each
Participant as a Performance Award.

                                       10
<PAGE>

The Committee shall set Performance Criteria in its discretion for each
Participant who is granted a Performance Award. The extent to which such
Performance Criteria are met will determine the value of the Performance Unit or
Performance Share to the Participant. Such Performance Criteria may be
particular to a Participant, may relate to the performance of the Company or
Subsidiary which employs him or her, or any combination of the foregoing. The
Performance Criteria may be based on achievement of financial statement
objectives, or any other objectives established by the Committee. The
Performance Criteria may be absolute in their terms or measured against, or in
relationship to, other companies comparably, similarly or otherwise situated.
The terms and conditions of each Performance Award will be set forth in an Award
Agreement.

     9.3    Settlement of Performance Awards.  After a Performance Period has
            --------------------------------
ended, the holder of a Performance Unit or Performance Share shall be entitled
to receive the value thereof based on the degree to which the Performance
Criteria established by the Committee and set forth in the Award Agreement have
been satisfied.

     9.4    Form of Payment.  Payment of the amount to which a Participant shall
            ---------------
be entitled upon the settlement of the Performance Award shall be made in cash,
Stock, or a combination thereof and may be made in a lump sum or installments
all as determined by the Committee and set forth in the related Award Agreement.

Section 10. Bonus Stock

     Subject to the terms and provisions of the Plan and applicable law, the
Committee may, at any time and from time to time, award shares of Bonus Stock to
participants under the Plan without cash consideration.  The Committee shall
determine and indicate in the related Award Agreement whether such shares of
Bonus Stock shall be unencumbered of any restrictions (other than those which
the Committee deems necessary or advisable to comply with law) or shall be
subject to restrictions and limitations similar to those referred to in Section
9.  In the event the Committee assigns any restrictions on the shares of Bonus
Stock, then such shares shall be subject to at least the following restrictions:

     (a)    No Shares of Bonus Stock may be sold, transferred, pledged, assigned
            or otherwise alienated or hypothecated if such Shares are subject to
            restrictions which have not lapsed or been satisfied.

     (b)    If any condition of vesting of the shares of Bonus Stock are not
            met, all such Shares subject to such vesting shall be delivered to
            the Company (in a manner determined by the Committee) within 60 days
            of the failure to meet such conditions without any payment from the
            Company.

                                       11
<PAGE>

Section 11. Other Stock Based Awards

     11.1   Grant of Other Stock Based Awards.  Subject to the terms and
            ---------------------------------
provisions of the Plan and applicable law, the Committee may, at any time and
from time to time, issue to Participants, either alone or in addition to other
Awards made under the Plan, Stock Unit Awards which may be in the form of Common
Stock or other securities.  The value of each such Award shall be based, in
whole or in part, on the value of the underlying Common Stock on the Grant Date.
The Committee, in its sole and complete discretion, may determine that an Award,
either in the form of a Stock Unit Award under this Section 11 or as an Award
granted pursuant to Sections 6 through 10, may provide to the Participant (i)
dividends or dividend equivalents (payable on a current or deferred basis) and
(ii) cash payments in lieu of or in addition to an Award.  Subject to the
provisions of the Plan, the Committee, in its sole and complete discretion,
shall determine the terms, restrictions, conditions, vesting requirements, and
payment rules of the Award.  The Award Agreement shall specify the rules of each
Award as determined by the Committee.  However, each Stock Unit Award need not
be subject to identical rules.

     11.2   Rules.  The Committee, in its sole and complete discretion, may
            -----
grant a Stock Unit Award subject to the following rules:

     (a)    If applicable and to the extent Stock Unit Awards are deemed to be
            derivative securities within the meaning of Rule 16b-3, the rights
            of a Participant who is subject to Section 16 of the Exchange Act
            with respect to such Awards shall not vest or be exercisable until
            the expiration of at least six months from the Award Date.

     (b)    All rights with respect to such Stock Unit Awards granted to a
            Participant under the Plan shall be exercisable during his or her
            lifetime only by such Participant or his or her guardian or legal
            representative.

     (c)    Stock Unit Awards may require the payment of cash consideration by
            the Participant in receipt of the Award or provide that the Award,
            and any Common Stock or other securities issued in conjunction with
            the Award, be delivered without the payment of cash consideration.

     (d)    The Committee, in its sole and complete discretion, may establish
            certain Performance Criteria that may relate in whole or in part to
            receipt of Stock Unit Awards.

     (e)    Stock Unit Awards may be subject to a deferred payment schedule
            and/or vesting over a specified period.

     (f)    The Committee, in its sole and complete discretion, as a result of
            certain circumstances, may waive or otherwise remove, in whole or in
            part, any restriction or condition imposed on a Stock Unit Award.

                                       12
<PAGE>

Section 12. Special Provisions Applicable to Covered Participants

     If the Company shall become subject to Code Section 162(m), Awards to
Covered Participants shall be governed by the conditions of this Section 12 in
addition to the requirements of Sections 6 through 11 above.  Should conditions
set forth under this Section 12 conflict with the requirements of Sections 6
through 11, the conditions of this Section 12 shall prevail.

     (a)    All Performance Criteria relating to Covered Participants for a
            relevant Performance Period shall be established by the Committee in
            writing prior to the beginning of the Performance Period, or by such
            other later date for the Performance Period as may be permitted
            under Section 162(m) of the Code. Performance Criteria may include
            alternative and multiple Performance Criteria and will be based on
            one or more of the following business criteria: business or
            financial goals of the Company, including absolute or relative
            levels of total shareholder return, revenues, sales, net income, or
            net worth of the Company, any of its Subsidiaries, divisions,
            business units, or other areas of the Company.

     (b)    The Performance Criteria must be objective and must satisfy third
            party "objectivity" standards under Code Section 162(m), and the
            regulations promulgated thereunder.

     (c)    The Performance Criteria shall not allow for any discretion by the
            Committee as to an increase in any Award, but discretion to lower an
            Award is permissible.

     (d)    The Award and payment of any Award under this Plan to a Covered
            Participant with respect to a relevant Performance Period shall be
            contingent upon the attainment of the Performance Criteria that are
            applicable to such Award. The Committee shall certify in writing
            prior to payment of any such Award that such applicable Performance
            Criteria have been satisfied. Resolutions adopted by the Committee
            may be used for this purpose.

     (e)    No Awards may be paid (in cash or in shares of Stock or a
            combination thereof) to any Covered Participant under the Plan
            pursuant to Sections 8, 9, 10 and 11 during any calendar year.

     (f)    The aggregate maximum number of shares of Stock subject to Options
            and SARs made to any Covered Participant during any calendar year
            shall be 100,000.

     (g)    All Awards to Covered Participants under this Plan shall be further
            subject to such other conditions, restrictions, and requirements as
            the Committee may determine to be necessary to carry out the
            purposes of this Section 12.

                                       13
<PAGE>

Section 13. Change In Control

     Notwithstanding any other provision of this Plan, in the event of a Change
in Control: (i) all outstanding Options shall immediately become fully vested
and exercisable; (ii) all Periods of Restriction shall be deemed to have been
completed; (iii) all Performance Criteria shall be deemed to have been satisfied
in full; and (iv) all other restrictions of any kind applicable to all
outstanding Awards shall be deemed to have lapsed or been satisfied in full;
provided that none of the effects described in (i) - (iv) above shall occur if
the Change in Control, or the transaction, event or occurrence causing the
Change in Control was duly and effectively approved in advance by the
affirmative vote of a majority of the Company's Board of Directors.

Section 14. General Provisions

     14.1   Plan Term.  The Plan was adopted by the Board on July 14, 1997, and
            ---------
became effective upon receiving stockholder approval on July 29, 1997.

     The Plan shall terminate December 31, 2006; however, all Awards made prior
to, and which are outstanding on such date, shall remain valid in accordance
with their terms and conditions.

     14.2   Withholding.  The Company shall have the right to deduct or
            -----------
withhold, or require a Participant to remit to the Company, any taxes required
by law to be withheld from Awards made under this Plan. In the event an Award is
paid in the form of Common Stock, the Committee may require the Participant to
remit to the Company the amount of any taxes required to be withheld from such
payment in Common Stock, or, in lieu thereof, the Company may withhold (or the
Participant may be provided the opportunity to elect to tender) the number of
shares of Common Stock equal in Fair Market Value to the amount required to be
withheld.

     14.3   Awards.  Each Award granted under the Plan shall be evidenced in a
            ------
corresponding Award Agreement provided in writing to the Participant, which
shall specify the terms, conditions and any rules applicable to the Award.

     14.4   Nontransferability.  Except with respect to Nonqualified Stock
            ------------------
Options, no Award granted under the Plan may be sold, transferred, pledged,
assigned or otherwise alienated or hypothecated, except by will or the laws of
descent and distribution.  Further, no lien, obligation, or liability of the
Participant may be assigned to any right or interest of any Participant in an
Award under this Plan.

     14.5   No Right to Employment.  Neither the Plan, nor any Award made, or
            ----------------------
any other action taken, hereunder shall be construed as giving any Participant
or other person any right of employment or continued employment with the
Company.

     14.6   Rights as Stockholder.  Subject to the terms and conditions of each
            ---------------------
particular Award, no Participant or Designated Beneficiary shall be deemed a
stockholder of the Company nor have

                                       14
<PAGE>

any rights as such with respect to any shares of Common Stock to be provided
under the Plan until he or she has become the holder of such shares.

     14.7   Construction of the Plan.  The Plan and all Agreements shall be
            ------------------------
governed, construed, interpreted and administered in accordance with the laws of
the State of Texas.  In the event any provision of the Plan or any Agreement
shall be held invalid, illegal or unenforceable, in whole or in part, for any
reason, such determination shall not affect the validity, legality or
enforceability of any remaining provision, portion of provision or Plan overall,
which shall remain in full force and effect as if the Plan had been absent the
invalid, illegal or unenforceable provision or portion thereof.

     14.8   Amendment of Plan.  The Committee or the Board of Directors may
            -----------------
amend, suspend, or terminate the Plan or any portion thereof at any time,
provided such amendment is made with stockholder approval if and to the extent
such stockholder approval is necessary to comply with any legal requirement,
including for these purposes any approval requirement which is a requirement for
the performance-based compensation exception under Code Section 162(m).

     14.9   Amendment of Award.  In its sole and complete discretion, the
            ------------------
Committee may at any time amend any Award for the following reasons: (i)
additions and/or changes are made to the Code, any federal or state securities
law, or other law or regulations applicable to the Award; or (ii) any other
event not described in clause (i) occurs and the Participant gives his or her
consent to such amendment.

     14.10  Exemption from Computation of Compensation for Other Purposes.  By
            -------------------------------------------------------------
acceptance of an applicable Award under this Plan, subject to the conditions of
such Award, each Participant shall be considered in agreement that all shares of
Stock sold or awarded and all Options granted under this Plan shall be
considered extraordinary, special incentive compensation and will not be
included as "earnings," "wages," "salary" or "compensation" in any pension,
welfare, life insurance, or other employee benefit arrangement of the Company.

     14.11  Legend.  In its sole and complete discretion, the Committee may
            ------
elect to legend certificates representing Shares sold or awarded under the Plan,
to make appropriate references to the restrictions imposed on such Shares.

     14.12  Unfunded Plan.  The Plan is intended to constitute an unfunded
            -------------
deferred compensation arrangement for a select group of management or highly
compensated employees.

     EXECUTED as of the 11th day of July, 2000.

                              NETSOLVE, INCORPORATED

                              By:       /s/ Craig S. Tysdal
                                  --------------------------------------------
                                        Craig S. Tysdal
                                        President and Chief Executive Officer

                                       15

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