CERTIFICATE







                                                                        Exhibit 4.1




CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS OF

SERIES A CUMULATIVE CONVERTIBLE PREFERRED STOCK




             Pursuant to Section 151(g) of the Delaware General Corporation Law,
I, Richard Grey, Secretary of CENTURA SOFTWARE CORPORATION, a Delaware
corporation (the "Corporation"), hereby certify that the following is a
true and correct copy of a resolution duly adopted by the Corporation's
Board of Directors at a meeting held on December 9, 1999, at which a
quorum was present and acting throughout, and that said resolution has
not been rescinded or amended and is in full force and effect at the date
hereof:


RESOLVED, that pursuant to the authority expressly granted to
and vested in the Corporation's Board of Directors by the
Certificate of Incorporation of the Corporation, as amended
to date, the Board of Directors hereby creates a series of
Preferred Stock of the Corporation, par value $.01 per share,
to be designated "Series A Cumulative Convertible Preferred
Stock" (hereinafter referred to as the "Preferred Stock") and
to consist of eighteen thousand five hundred (18,500) shares,
with an initial stated value of $1,000 per share (the "Stated
Value"), and hereby fixes the voting powers, designations,
preferences and relative, participating, optional or other
rights, and the qualifications, limitations or restrictions
thereof, of the Preferred Stock, as follows:


                     1.      Dividends.  (a)  Each share of Preferred Stock shall be
entitled to receive, in preference to the holders of Junior Securities
(as defined herein), cumulative annual dividends at the rate of 4.5% per
annum on the Aggregate Value (as defined herein) thereof.  Such dividends
shall be due and payable quarterly in arrears on the last day of March,
June, September and December of each year (each, a "Dividend Payment
Date"), commencing on March 31, 2000.  Dividends shall accumulate daily
on each share of Preferred Stock from the Issuance Date (as defined
herein), whether or not earned or declared, until such share of Preferred
Stock has been converted or redeemed as herein provided.  To the extent
dividends are not paid on the applicable Dividend Payment Date, such
dividends shall be cumulative and shall compound quarterly until the date
of payment of such dividend.  The dividends so payable will be paid to
the person in whose name the applicable shares of Preferred Stock (or one
or more predecessor shares) are registered on the records of the Company
regarding registration and transfers of the Preferred Stock (the
"Preferred Stock Register"); provided, however, that the Company's
obligation to a transferee of a share of Preferred Stock arises only if
such transfer, sale or other disposition is made in accordance with the
terms and conditions hereof and the Subscription Agreement, dated as of
the Issuance Date, by and between the Company and the Subscribers set
forth on the signature pages thereof (the "Subscription Agreement").




                (b)     The dividends are payable in such coin or currency of
the United States of America as at the time of payment is legal tender,
to the person in whose name the applicable share(s) of Preferred Stock is
duly registered on the Preferred Stock Register (the "Holder") on the
tenth calendar day prior to the applicable Dividend Payment Date and at
the address last appearing on the Preferred Stock Register as designated
in writing by such Holder thereof from time to time; provided, however,
that, in lieu of paying such dividends in coin or currency, the Company
may, at its option, in full or in part, pay dividends on the shares of
Preferred Stock on any Dividend Payment Date by increasing the Aggregate
Value of the Preferred Stock by the amount of such dividend such that the
sum of (i) the amount of such increase in the Aggregate Value and (ii)
the amount of cash dividend paid in part, if any, is equal to the amount
of the cash dividend which would otherwise be paid on such Dividend
Payment Date if such dividend were paid entirely in cash.  Any such
increase in the Aggregate Value (plus the amount of cash dividend, if
any, paid together therewith) shall constitute full payment of such
dividend.  When any dividend is added to the Aggregate Value, such
dividend shall, for all purposes of the Preferred Stock, be deemed to be
part of the Aggregate Value for purposes of determining dividends
thereafter payable hereunder and amounts thereafter convertible into
Common Stock hereunder, and all references herein to the Aggregate Value
shall mean the Aggregate Value, as adjusted pursuant to these provisions.


                (c)     If the Company shall elect to pay any part of a
dividend by increasing the Aggregate Value as described in Paragraph
2(b), the Company will provide notice setting forth the new Aggregate
Value to each Holder (a "Dividend Notice") on or prior to the applicable
Dividend Payment Date.


                (d)     If the cash dividends due hereunder are not paid or the
Dividend Notice is not delivered to each Holder within ten (10) calendar
days after the applicable Dividend Payment Date, the Company shall no
longer have the right to choose the method by which dividends are paid,
and each Holder may elect either cash dividends or dividends payable by
increasing the Aggregate Value.


                (e)     Except as specifically provided herein, an election by
the Company to pay dividends, in full or in part, in cash on any Dividend
Payment Date shall not preclude the Company from electing any other
available alternative in respect of all or any portion of any subsequent
dividend.


                (f)     Provided that the total Stated Value of all the then
outstanding shares of Preferred Stock is in excess of $2,800,000, no
dividends, including, without limitation, dividends or distributions paid
in shares of, or options, warrants or rights to subscribe for, or
purchase shares of, equity securities of the Company to which the
Preferred Stock ranks prior (whether with respect to dividends or upon
liquidation, dissolution, winding up or otherwise), including the Common
Stock (collectively, the "Junior Securities") or on parity (whether with
respect to dividends or upon liquidation, dissolution, winding up or
otherwise) (collectively, the "Parity Securities"), shall be declared or
paid or set apart for payment or other distribution upon the Junior
Securities or the Parity Securities, nor shall any Junior Securities or
Parity Securities be redeemed, purchased or otherwise acquired for any
consideration (or any monies to be paid to, or made available for, a
sinking fund for the redemption of any shares of any such stock) by the
Company, directly or indirectly (except by conversion to, or exchange
for, Junior Securities or Parity Securities, respectively).





                     2.      Preferred Rank.  (a)  All shares of Junior Securities
shall be of junior rank and subject to all shares of Preferred Stock in
respect of dividend rights and preferences as to distributions and
payments upon the liquidation, dissolution, winding up or otherwise of
the Company.



                        (b)     Provided that the total Stated Value of all the
then outstanding shares of Preferred Stock is in excess of $2,800,000, the
Company shall not hereafter, without the prior express written consent of
the Holders of not less than two-thirds (2/3) of the then outstanding
shares of Preferred Stock, (i) issue any additional shares of Preferred
Stock; (ii) authorize or issue any capital stock that ranks senior to the
Preferred Stock in respect of dividend rights or the preferences as to
distributions and payments upon the liquidation, dissolution, winding up
or otherwise of the Company, (iii) authorize or issue any Parity
Securities with terms and conditions more favorable than the terms
herein, or (iv) authorize or make any amendment to the Company's
Certificate of Incorporation or By-laws, or file any resolution of the
Board of Directors of the Company with the Secretary of State of the
State of Delaware containing any provisions, which, in the case of clause
(iv), would adversely affect or otherwise impair the rights or relative
priority of the Holders of the shares of Preferred Stock relative to the
holders of Parity Securities, the holders of Junior Securities or the
holders of any other class of capital stock.


                        (c)     In the event of the merger, consolidation or
other business combination of the Company with or into another
corporation, the Preferred Stock shall maintain its relative powers,
designations and preferences provided for herein and no merger,
consolidation or other business combination shall result in a treatment
that is inconsistent therewith.





                     3.      Transfers.  The shares of Preferred Stock have been
issued subject to investment representations of the original purchaser of
such shares and may be transferred or exchanged only in compliance with
the Securities Act of 1933, as amended (the "Act"), and applicable state
securities laws.  Prior to due presentment for transfer of each share of
Preferred Stock, the Company may treat the Holder as the owner thereof
for the purpose of receiving payments as herein provided and all other
purposes, and the Company shall not be affected by notice to the
contrary.


                     4.      Definitions.  For purposes hereof the following
definitions shall apply:



                     "Aggregate Value" shall mean for each share of Preferred
Stock the sum of (a) the Stated Value thereof, plus (b) accumulated but
unpaid dividends thereon (whether or not earned or declared).


                     "Ceiling Price" shall mean $5.82;  provided, however, that
if, at any time after the Issuance Date (provided that the total Stated
Value of all the then outstanding shares of Preferred Stock is in excess
of $2,800,000), the Company offers, sells, contracts to sell or otherwise
issues or agrees to issue any Derivative Securities of the Company in a
private placement transaction (other than (i) pursuant to any stock or
option or similar equity-based compensation plan for employees, officers,
directors or consultants or (ii) up to 250,000 warrants in any twelve
(12) month period on a cumulative basis that are not compensatory in
nature), with a maximum conversion price per share of Common Stock of an
amount less than the Ceiling Price, then the "Ceiling Price" shall mean
such lower conversion price or offer price per share for the Preferred
Stock not yet converted.  The Ceiling Price shall also be subject to
adjustment from time to time ratably for any events set forth in
Paragraphs 6 and 10 hereof.


                     "Closing Price" shall mean the price of one share of Common
Stock determined as follows:




                        (a)     If the Common Stock is quoted on the Nasdaq
National Market or The Nasdaq SmallCap Market, the closing bid price, as
reported by Bloomberg, L.P. on the date of valuation (or, if there is no
closing bid price for such date, the most recent previous closing bid
price);


                        (b)     If the Common Stock is listed on a national
securities exchange, the last reported closing bid price on such exchange
on the date of valuation (or, if there is no last reported closing bid
price on that date, the most recent previous closing bid price);


                        (c)     If neither (a) nor (b) apply, but the Common
Stock is quoted in the over-the-counter market on the pink sheets or
bulletin board, the closing bid price on the date of valuation; and


                        (d)     If none of clause (a), (b) or (c) above applies,
the market value as determined by a nationally recognized investment
banking firm or other nationally recognized financial advisor retained in
good faith by the Board of Directors of the Company for such purpose,
taking into consideration among other factors, the earnings history, book
value and prospects for the Company, and the prices at which shares or
Common Stock recently have been traded.  Such determination shall be
conclusive and binding on all persons.





                     "Common Stock" shall mean the common stock, par value $0.01
per share, of the Company, and any stock into which such Common Stock may
hereafter be changed.


                     "Company-Directed Period" shall mean the period beginning on
the date which is ten (10) business days after the Registration Statement
has been declared effective by the SEC and ending on and including the
date which is ten (10) months after the Issuance Date.
 .

                     "Conversion Period Conversion Price" shall mean the lowest of
the daily weighted average trading prices on the Principal Market as
reported by Bloomberg, L.P. (on the VAP function) during the Valuation
Period.


                     "Conversion Price" shall mean (a) the Ceiling Price or (b)
during any Company Election Conversion Period or if the Company breaches
or fails to comply with Section 5.19 of the Subscription Agreement, an
amount that is equal to the lesser of (i) the Ceiling Price and (ii) the
Conversion Period Conversion Price, in each case, subject to adjustment
as provided herein.


                     "Conversion Rate" shall mean the number of shares of Common
Stock issuable upon conversion of each share of Preferred Stock
determined by the application of the following formula where D equals the
accumulated but unpaid dividends (whether or not declared) for each share
of Preferred Stock (not previously added to the Stated Value pursuant to
Paragraph 1 hereof) as of the Holder Conversion Date (as defined in
Paragraph 7):


              Stated Value + D      

                 Conversion Price


                     "Derivative Securities" shall mean securities of the Company
which are, directly or indirectly, convertible into or exercisable or
exchangeable for Common Stock.


                     "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.


                     "Initial Shares" shall mean the up to Twelve Thousand Five
Hundred (12,500) shares of Preferred Stock issuable pursuant to Section
1.1 of the Subscription Agreement.


                     "Initial Issuance Date" shall mean December 30, 1999.


                     "Issuance Date" shall mean (a) with respect to the Initial
Shares, the Initial Issuance Date and (b) with respect to the Subsequent
Shares, the Subsequent Issuance Date.


                     "Person" means and includes an individual, a partnership, a
joint venture, a corporation, a company, a limited liability company, a
trust, an unincorporated organization and a government or any department
or agency thereof.


                     "Principal Market" means The Nasdaq SmallCap Market, or if
the Common Stock is not traded on The Nasdaq SmallCap Market, then the
principal securities exchange or trading market for the Common Stock.


                     "Registration Rights Agreement" shall mean the Registration
Rights Agreement, dated as of the Issuance Date, by and between the
Company and the Purchasers named therein.


                     "Registration Statement" shall mean the registration
statement on Form S-3 filed by the Company with the SEC to register the
shares of Common Stock issuable upon conversion of shares of Preferred
Stock.


                     "SEC" shall mean the Securities and Exchange Commission and
any successor entity thereto.


                     "Subsequent Issuance Date" shall mean the initial date of
issuance of the Subsequent Shares.


                     "Subsequent Shares" shall mean the up to Six Thousand (6,000)
shares of Preferred Stock issuable upon the exercise of the Call Option
(as defined in the Subscription Agreement) pursuant to Section 1.2 of the
Subscription Agreement.


                     "Triggering Event" means the occurrence of any of the
following events:




                        (a)     the Common Stock is either delisted or suspended
from trading on The Nasdaq SmallCap Market, the Nasdaq National Market,
The New York Stock Exchange, Inc. or The American Stock Exchange, Inc.
for a period of ten (10) consecutive trading days (excluding disruptions
from business announcements that result in any halt(s) in trading of not
more than one day on each occasion), and other than as a result of the
suspension of trading in securities on such market in general; or


                        (b)     the Company is ineligible to use Form S-3 or is
required to use a different form of registration statement to register the
shares of Common Stock issuable upon conversion of shares of Preferred
Stock with the SEC, which shares of Common Stock are then required to be
registered pursuant to the terms of the Registration Rights Agreement; or


                        (c)     (i) the failure of the Registration Statement to
be declared effective by the SEC on or prior to the date that is 150 days
from the Issuance Date, or (ii) while the Registration Statement is
required to be maintained effective pursuant to the terms of the
Registration Rights Agreement, the effectiveness of the Registration
Statement lapses for any reason (including, without limitation, the
issuance of a stop order) or is unavailable to the holder of the shares
of Preferred Stock for sale of all of the Registrable Securities (as
defined in the Registration Rights Agreement) in accordance with the
terms of the Registration Rights Agreement, and such lapse or
unavailability continues for a period of ten (10) consecutive trading
days or for more than an aggregate of forty-five (45) trading days in any
365-day period; or


                        (d)     notice by the Company or by the Company's transfer
agent (which notice, in the case of the transfer agent, has not been revoked
within three (3) business days after notice to the Company) to any holder of
shares of Preferred Stock, including by way of public announcement, at any
time, of its intention not to comply with a request for conversion of any
shares of Preferred Stock into shares of Common Stock that are tendered in
accordance with the provisions of this Certificate of Designations; or


                        (e)     a Conversion Default (as defined in Paragraph
12(b)); or


                        (f)     the Company shall not have complied with Section
5.15 of the Subscription Agreement or shall not have received the requisite
stockholder approval at the stockholder meeting contemplated by Section 5.15
of the Subscription Agreement; or


                        (g)     any uninsured money judgment not subject to
further appeal (including any arbitration award, but only if reduced to a
judgment), writ or warrant of attachment, or similar process in excess of
Two Million Dollars ($2,000,000) in the aggregate shall be entered or
filed against the Company, its subsidiaries or any of their properties or
other assets and which shall remain unpaid, unvacated, unbonded or
unstayed for a period of sixty (60) days or in any event later than ten
(10) days prior to the date of any proposed sale thereunder; or


                        (h)     the Company shall not be in compliance with, or
the Company shall have breached any of the provisions of, this
Certificate of Designations, the Subscription Agreement, the Warrants,
the Registration Rights Agreement or any other document, certificate,
agreement or other instrument delivered in connection with the
transactions contemplated hereby and thereby, except in the case of a
failure to comply with or a breach which is curable, only if such failure
to comply or breach continues for a period of at least ten (10) days
after notice to the Company.





                     "Valuation Period" shall mean the ten (10) trading days
immediately preceding and including the Holder Conversion Date (as
defined herein), subject to adjustment from time to time ratably for any
events set forth in Paragraph 10 hereof that occur during such ten (10)
trading day period.


                     5.      Paragraph 5 Transactions. If at any time (i) there
occurs any merger, consolidation or other business combination of the
Company, with or into any other corporation, entity or person (whether or
not the Company is the surviving corporation) or there occurs any other
corporate reorganization or transaction or series of related
transactions, and as a result thereof the shareholders of the Company
pursuant to such merger, consolidation, reorganization or other
transaction own in the aggregate less than 50% of the voting power and
common equity of the ultimate parent corporation or other entity
surviving or resulting from such merger, consolidation, reorganization or
other transaction, (ii) the Company transfers all or substantially all of
the Company's assets to another corporation or other entity or person, or
(iii) a purchase, tender or exchange offer is made to and accepted by the
holders of more than 50% of the outstanding shares of Common Stock (each
of the foregoing items (i) to (iii), a "Paragraph 5 Transaction"), then
the Holders of the Preferred Stock then outstanding may participate in
any such transaction as a class with the common stockholders on the same
basis as if the Preferred Stock had been converted one day prior to the
announcement date (or record date for such distribution, dividend or
offer) of such transaction.  In the case of item (iii) above, the Company
shall provide written notice by facsimile to each Holder one (1) business
day following the effective date of the purchase, tender or exchange
offer, and each Holder shall have three (3) business days to elect to
participate in such transaction by providing written notice by facsimile
to the Company.


                     6.      Redemption




(a)     Optional Redemption Upon a Paragraph 5 Transaction.  At
the option of each Holder, the Company shall redeem all or any portion of
such Holder's outstanding shares of Preferred Stock effective as of the
effective date of a Paragraph 5 Transaction, and the Holder shall be
entitled to receive on the specified redemption date a redemption price
per share of Preferred Stock being redeemed equal to 112.5% of the
Aggregate Value at the effective date of the Paragraph 5 Transaction.
Each Holder shall be entitled to make an election for redemption by
giving written notice, in the form of EXHIBIT 1 hereto (the "Redemption
Notice") by facsimile (with the original of such notice forwarded with
the foregoing courier) to the Company at such office to the effect that
such Holder elects to have redeemed the number of shares of Preferred
Stock (plus accumulated but unpaid dividends thereon, whether or not
earned or declared) specified therein, at any time up to five (5) days
prior to the effective date of any Paragraph 5 Transaction; provided,
however, at the discretion of such Holder, such Holder may, at any time,
elect to convert its shares of Preferred Stock into fully paid, validly
issued and nonassessable shares of Common Stock in accordance with the
terms of Paragraph 7 hereof, for such number of shares of Common Stock as
determined by the application of the Conversion Rate so long as the
Company has not redeemed such shares of Preferred Stock.


                (b)     Optional Redemption Upon a Triggering Event.  At the
option of each Holder, the Company shall redeem all or any portion of
such Holder's outstanding shares of Preferred Stock effective as of the
date of the occurrence of a Triggering Event, and the Holder shall be
entitled to receive on the specified redemption date a redemption price
per share of Preferred Stock being redeemed equal to 125% of the
Aggregate Value as of the effective date of the Triggering Event.  Each
Holder shall be entitled to make an election for redemption at any time
following thirty (30) days after the occurrence of a Triggering Event by
giving the Redemption Notice by facsimile (with the original of such
notice forwarded with the foregoing courier) to the Company at such
office to the effect that such Holder elects to have redeemed the number
of shares of Preferred Stock specified therein; provided, however, at the
discretion of such Holder, such Holder may, at any time, elect to convert
its shares of Preferred Stock into fully paid, validly issued and
nonassessable shares of Common Stock in accordance with the terms of
Paragraph 7 hereof, for such number of shares of Common Stock as
determined by the application of the Conversion Rate so long as the
Company has not redeemed such shares of Preferred Stock.  If there is a
Triggering Event pursuant to subsection (f) of the definition of
Triggering Event, this Paragraph 6(b) shall only apply to the outstanding
shares of Preferred Stock representing greater than 19.99% of the
outstanding Common Stock of the Company.  In addition to the foregoing,
upon the occurrence of a Triggering Event, the Holders shall have the
right to receive a 2.0% reduction in the Conversion Price of the
Preferred Stock for each thirty (30) day period (or part thereof)
following a Triggering Event, but in no event shall such reduction exceed
6.0%.


                (c)     Redemption at the Option of the Company.  The Company
may, at its option, at any time, redeem the outstanding shares of
Preferred Stock at a redemption price per share of Preferred Stock being
redeemed equal to 121% of the Aggregate Value as of the date upon which
the redemption is to be made (the "Company Redemption Price"); provided,
however, at the discretion of such Holder, such Holder may, at any time,
elect to convert its shares of Preferred Stock into fully paid, validly
issued and nonassessable shares of Common Stock in accordance with the
terms of Paragraph 7 hereof, for such number of shares of Common Stock as
determined by the application of the Conversion Rate so long as the
Company has not redeemed such shares of Preferred Stock.  If the Company
redeems any shares of Preferred Stock pursuant to this Paragraph, it must
redeem all of the shares of Preferred Stock.  The Company shall give
notice of redemption in the form of EXHIBIT 2, pursuant to this Paragraph,
signed on behalf of the Company by its President to the holders of the
shares of Preferred Stock not less than forty-five (45) days prior to the
date upon which the redemption is to be made pursuant to this Paragraph
(the "Company Redemption Notice"), specifying (i) the Company Redemption
Price, and (ii) the date of such redemption.  The Company Redemption
Notice having been so given, the amount of the Company Redemption Price of
the shares of Preferred Stock shall become due and payable on the
specified redemption date.


                (d)     Mechanics of Redemption.




                        (i)     In order to redeem any shares of Preferred Stock
(in whole or in part), the applicable Holder shall surrender the stock
certificate(s) representing the shares of Preferred Stock to be redeemed,
by either overnight courier or two-day courier, to the principal office of
the Company, provided, however, that the Company shall not be obligated to
pay the applicable redemption price unless either the stock certificate(s)
evidencing the shares of Preferred Stock being redeemed is delivered to
the Company as provided above, or if the Holder notifies the Company that
such certificate(s) has been lost, stolen or destroyed and follows such
procedures as are set forth in Paragraph 20.  If fewer than all the shares
represented by such certificate or certificates are to be redeemed, the
Company shall issue and deliver to or on the order of the holder thereof,
at the expense of the Company, a new certificate or certificates
representing the unredeemed shares, to the same extent as if the
certificate theretofore representing such unredeemed shares had not been
surrendered on redemption.


                        (ii)    The Company shall pay the applicable redemption
price on the date of redemption set forth on the Redemption Notice or
Company Redemption Notice and after receipt by the Company of such stock
certificate(s) evidencing the shares of Preferred Stock being redeemed, or
after receipt of such agreement and indemnification set forth in Paragraph
20, to such Holder, together with, if appropriate, a stock certificate
evidencing the number of shares of Preferred Stock covered by the
submitted stock certificate(s) not submitted for redemption; provided that
in the case where more than one Holder submits shares of Preferred Stock
for redemption simultaneously and the Company is unable to redeem all
shares of Preferred Stock submitted for such redemption, the Company shall
redeem an amount from each Holder equal to each Holder's pro rata amount
(based on the number of shares of Preferred Stock held by each Holder
relative to the number of shares of Preferred Stock outstanding) of all
shares of Preferred Stock being redeemed.


                        (iii)   If the Company shall fail to redeem all of the
shares of Preferred Stock submitted for redemption, in addition to any
remedy each Holder may have under this Certificate of Designations, the
Subscription Agreement and the Registration Rights Agreement, the
applicable redemption price payable in respect of such unredeemed shares
of Preferred Stock shall bear interest at the rate of 2.0% for the first
three thirty (30) day periods after the required date of payment of the
redemption price and 1.0% for each thirty (30) day period thereafter (in
each case, pro rated for partial periods) until such redemption price is
paid in full or the maximum rate permitted by law (which amount shall be
paid as liquidated damages and not as a penalty).  Until the Company pays
such unpaid redemption price in full to a Holder, such Holder shall have
the option, in lieu of redemption, but not in limitation of its rights to
receive interest as liquidated damages or any other remedy such Holder may
have under law, this Certificate of Designations, the Subscription
Agreement and the Registration Rights Agreement, to require the Company to
promptly return to such Holder all of the shares of Preferred Stock
submitted for redemption by such Holder and for which the applicable
redemption price has not been paid, by sending written notice thereof to
the Company via facsimile (a "Revocation Notice").  Upon the Company's
receipt of such Revocation Notice and prior to payment in full of the
applicable redemption price to such Holder, (i) the Redemption Notice
shall be null and void with respect to those shares of Preferred Stock
submitted for redemption and for which the applicable redemption price has
not been paid, (ii) the Company shall immediately return any shares of
Preferred Stock submitted to the Company for redemption for which the
applicable redemption price has not been paid, and (iii) the Ceiling Price
of those returned shares shall be converted to the lesser of (A) the
Ceiling Price prior to the date of the Revocation Notice or (B) 90% of the
Conversion Period Conversion Price.





                        (e)     Notwithstanding the foregoing, in the event of a
dispute as to the determination of the calculation of the applicable
redemption price, the amount of the redemption price that is not in
dispute shall be promptly paid to the Holder in accordance with Paragraph
5(d)(i) hereof.  The Holder shall then be entitled, within sixty (60) days
of receipt of either the Redemption Certificate or Redemption Notice, to
submit such dispute to the American Arbitration Association for resolution
according to the then applicable rules thereof, which determination shall
be final and binding on all parties.  If it shall be determined that a
Holder shall receive additional monies in respect of such redemption, the
Company shall deliver to such Holder such amount within three (3) business
days of written notice of such determination.  The cost of such proceeding
shall be borne by the Company, except that the prevailing party, as
determined by the arbitrator presiding over the arbitration, shall be
entitled to recover reasonable attorneys' fees, in addition to other costs
and expenses and any other available remedy.





                     7.      Conversion at the Option of the Holder.  Subject to the
limitations of Paragraph 15, the Holder shall have the following
conversion rights:




                        (a)     Holder's Right to Convert.  Subject to the
restrictions set forth below, shares of Preferred Stock shall be
convertible, in whole or in part, at any time at the option of the Holder
thereof, into fully paid, validly issued and nonassessable shares of
Common Stock in accordance with the terms herein for such number of shares
of Common Stock as determined by the application of the Conversion Rate.


                        (b)     Mechanics of Conversion.  In order to convert any
shares of Preferred Stock (in whole or in part) into full shares of Common
Stock, the applicable Holder shall surrender the stock certificate(s)
representing the shares of Preferred Stock to be converted, by either
overnight courier or two-day courier, to the principal office of the
Company, and shall give written notice in the form of EXHIBIT 3 (the
"Conversion Notice") by facsimile (with the original of such notice
forwarded with the foregoing courier) to the Company at such office to the
effect that such Holder elects to have converted the number of shares of
Preferred Stock (plus accumulated but unpaid dividends thereon) specified
therein; provided, however, that the Company shall not be obligated to
issue stock certificate(s) evidencing shares of Common Stock issuable upon
such conversion unless either the stock certificate(s) evidencing the
shares of Preferred Stock being converted is delivered to the Company as
provided above, or if the Holder notifies the Company that such
certificate(s) has been lost, stolen or destroyed, such Holder follows
such procedures as are set forth in Paragraph 20.  If fewer than all the
shares represented by such certificate or certificates are to be
converted, the Company shall within three (3) business days issue and
deliver to or on the order of the Holder thereof, at the expense of the
Company, a new certificate or certificates representing the unconverted
shares, to the same extent as if the certificate theretofore representing
such unconverted shares had not been surrendered on conversion.  The
effective date of conversion (the "Holder Conversion Date") shall be
deemed to be the date on which the Company receives by facsimile the
Conversion Notice.


                        (c)     The Company shall use its best efforts to issue
and deliver within three (3) business days after receipt by the Company of
such stock certificate(s) evidencing the shares of Preferred Stock being
converted, or after receipt of the affidavit, agreement and
indemnification as set forth in Paragraph 20, to such Holder, or to its
designee, certificates for the number of shares of Common Stock to which
such Holder shall be entitled hereunder or, if requested by the Holder,
issue such shares in electronic format (i.e., DWAC), together with a
certificate, certified by an appropriate officer of the Company, setting
forth the calculation of the Conversion Rate and, if appropriate, a stock
certificate evidencing the number of shares of Preferred Stock covered by
the submitted for conversion.  The person or persons entitled to receive
the shares of Common Stock issuable upon such conversion shall be treated
for all purposes as the record holder of such shares of Common Stock on
the Holder Conversion Date.


                        (d)     Each certificate representing shares of Preferred
Stock surrendered to the Company for conversion pursuant to this
Paragraph 7 shall, on the Holder Conversion Date and subject to issuance
of the shares of Common Stock issuable upon conversion thereof, be
canceled and retired by the Company.  Upon issuance of the shares of
Common Stock issuable upon conversion of the Preferred Stock pursuant to
this Paragraph 7, the shares of Preferred Stock formerly represented
thereby shall be deemed to be canceled and shall no longer be considered
to be issued and outstanding for any purpose, including without
limitation, for purposes of accumulating dividends thereon.  Such shares
of Preferred Stock shall be retired and shall not be subject to
reissuance by the Company.





                     8.      Conversion at the Company's Election.  On any date
during the Company-Directed Period, the Company shall have the right, in
its sole discretion, to require that some or all of the outstanding
shares of Preferred Stock be converted (a "Company Conversion Election")
into fully paid, validly issued and nonassessable shares of Common Stock
in accordance with the terms herein for such number of shares of Common
Stock as determined by the application of the Conversion Rate.  The
Company shall exercise the Company Conversion Election by providing each
Holder telephonic notice and written notice in the form of EXHIBIT 4 (a
"Company Election Conversion Notice") by facsimile and electronic mail
setting forth (a) the Aggregate Value of the shares of Preferred Stock
the Company has selected for conversion, (b) the period selected by the
Company for conversion (a "Company Election Conversion Period"), which
Company Election Conversion Period shall be not less than ten (10)
business days or more than fifty (50) business days and shall, in any
event, expire upon conversion of all shares of Preferred Stock specified
in the Company Election Conversion Notice, (c) the date on which the
Company Election Conversion Period shall commence which shall be two (2)
business days after the date of the Company Election Conversion Period (a
"Company Election Conversion Period Commencement Date"), and (d) each
Holder's Pro Rata Conversion Amount (as defined below).  Subject to the
last sentence of this Paragraph 8, a Company Conversion Election Period
shall not exceed beyond the expiration of the Company-Directed Period.
If the Company elects to require conversion of some, but not all, of such
shares of Preferred Stock then outstanding, the Company shall require
conversion of the pro rata amount from each Holder based on the Stated
Value of the shares of Preferred Stock purchased by such Holder (or its
predecessor) relative to the total Stated Value of the number of shares
of Preferred Stock purchased on the Issuance Date (such amount with
respect to each Holder being referred to herein as its "Pro Rata
Conversion Amount").  Each Holder shall,  during the Company Election
Conversion Period, deliver one or more Conversion Notices in accordance
with Paragraph 7(b), which one or more Conversion Notices shall relate to
an aggregate number of shares of Preferred Stock having an Aggregate
Value equal to such Holder's Pro Rata Conversion Amount.  Upon the
expiration of the Company Election Conversion Period, each Holder will be
deemed to have submitted a Conversion Notice (as of the last day of the
Company Election Conversion Period) in accordance with Paragraph 7(b) for
a number of shares of Preferred Stock having an Aggregate Value equal to
(a) such holder's Pro Rata Conversion Amount minus (b) the number of
shares of Preferred Stock previously converted by such Holder during the
Company Election Conversion Period; provided, however, in no event shall
any Holder be required to convert during any Company Election Conversion
Period shares of Preferred Stock having an Aggregate Value in excess of
such Holder's pro rata portion (determined in the same manner as the Pro
Rata Conversion Amount above) of 10% of the aggregate trading volume of
the Common Stock on the Principal Market (as reported by Bloomberg, L.P.)
during the Company Election Conversion Period.


                     Notwithstanding any other provision of this Certificate of
Designations, if the Company delivers a Blocking Notice (as defined in
the Registration Rights Agreement) during a Company Election Conversion
Period, such Company Election Conversion Period shall terminate and the
Holders shall not be obligated to continue to convert any shares of
Preferred Stock for such Company Election Conversion Period; provided,
however, any Holder may elect, in its sole discretion, to convert its Pro
Rata Conversion Amount as if the Company Election Conversion Period were
still in effect.  In any event, once the Blocking Notice has been
withdrawn, the Company may deliver an additional Company Election
Conversion Notice and commence a new Company Election Conversion Period.


                     The Company shall not be permitted to deliver a Company
Election Conversion Notice during any Company Election Conversion Period.


                     Notwithstanding any other provision of this Certificate of
Designations, upon the expiration of the Company-Directed Period, the
Company shall be deemed to have provided a Company Election Conversion
Notice and to have commenced a Company Election Conversion Period, which
Company Election Conversion Period will continue in effect through and
including the Maturity Date.


                     9.      Maturity.




                        (a)     On the date that is the fifth anniversary of the
Issuance Date, or such later date to which such date has been extended
pursuant to Paragraph 19 hereof (the "Maturity Date"), the Company shall
cause the shares of Preferred Stock then outstanding to be automatically
converted into that number of fully paid, validly issued and
nonassessable shares of Common Stock determined in accordance with the
terms of this Certificate of Designations by application of the then
applicable Conversion Rate.


                        (b)     The Company shall give the Holders written notice
of such conversion pursuant to Paragraph 9(a) not less than ten (10) days
prior to the Maturity Date, and such written notice shall specify (i) the
Maturity Date, and (ii) the place or places to which stock certificates
representing the Preferred Stock are to be surrendered for conversion.
Such conversion shall be effected as of the Maturity Date in accordance
with and pursuant to the terms of this Certificate of Designations at the
then applicable Conversion Rate and in accordance with the procedures set
forth in Paragraph 6(b) of this Certificate of Designations; provided,
however, that the Holder shall not be obligated to provide the Conversion
Notice to the Company.


                        (c)     Each certificate representing shares of Preferred
Stock surrendered to the Company for conversion pursuant to this
Paragraph 9 shall, on the Maturity Date and subject to issuance of the
shares of Common Stock issuable upon conversion, be canceled and retired
by the Company.  Upon issuance of the shares of Common Stock issuable
upon conversion of the Preferred Stock pursuant to this Paragraph 9, the
shares of Preferred Stock formerly represented thereby shall be deemed to
be canceled and shall no longer be considered to be issued and
outstanding for any purpose, including without limitation, for purposes
of accumulating dividends thereon.


                        (d)     The Company shall use its best efforts to issue
and deliver within three (3) business days after receipt by the Company of
the stock certificate(s) evidencing the shares of Preferred Stock, or
after receipt of the affidavit, agreement and indemnification described in
Paragraph 20, to all Holders, or to their designee, a certificate for the
number of shares of Common Stock to which each Holder shall be entitled
hereunder or, if requested by the Holder, issue such shares in electronic
format (i.e., DWAC), together with a certificate, certified by an
appropriate officer of the Company, setting forth the calculation of the
Conversion Rate.  The person or persons entitled to receive the shares of
Common Stock issuable upon such conversion shall be treated for all
purposes as the record holder of such shares of Common Stock on the
Maturity Date.  The Maturity Date shall be deemed a "Holder Conversion
Date" for purposes of the Preferred Stock.





                     10.     Stock Splits; Dividends; Adjustments; Reorganizations.



                        (a)     Stock Splits and Combinations.  The Company shall
not effect any stock split, subdivision or combination with an effective
date within thirty (30) trading days of the Maturity Date.  If the Company
at any time subdivides (by any stock split, subdivision or otherwise) its
outstanding shares of Common Stock into a greater number of shares, the
Ceiling Price in effect immediately prior to such subdivision will be
proportionately reduced.  If the Company at any time combines (by
combination, reverse stock split or otherwise) one or more of its
outstanding shares of Common Stock into a smaller number of shares, the
Ceiling Price in effect immediately prior to such combination will be
proportionately increased.


                        (b)     Certain Dividends and Distributions.  The Company
shall not make, or fix a record date for the determination of holders of
Common Stock or other securities entitled to receive, a dividend or other
distribution payable in additional shares of Common Stock, with an
effective date within thirty (30) trading days of the Maturity Date.


                        (c)     Adjustment for Other Dividends and Distributions.
In the event the Company at any time or from time to time after the
Issuance Date makes, or fixes a record date for the determination of
holders of Common Stock entitled to receive, a dividend or other
distribution payable in securities of the Company other than shares of
Common Stock, then and in each such event, provision shall be made so that
the Holders shall receive upon conversion of their shares of Preferred
Stock pursuant to Paragraphs 6 and 9 hereof, in addition to the number of
shares of Common Stock receivable thereupon, the amount of such other
securities of the Company to which a Holder on the relevant record or
payment date, as applicable, of the number of shares of Common Stock so
receivable upon conversion would have been entitled, plus any dividends or
other distributions which would have been received with respect to such
securities had such Holder thereafter, during the period from the date of
such event to and including the Holder Conversion Date, retained such
securities, subject to all other adjustments called for during such period
under this Paragraph 10 with respect to the rights of the Holders.  For
purposes of this Paragraph 10(c), the number of shares of Common Stock so
receivable upon conversion by the Holder shall be deemed to be that number
which the Holder would have received upon conversion of the Preferred
Stock if the Holder Conversion Date had been the day preceding the date
upon which the Company announced the making of such dividend or other
distribution.


                        (d)     Adjustment of Conversion Period Conversion Price
upon Issuance of Derivative Securities.  Provided that the total Stated
Value of the then outstanding shares of Preferred Stock is in excess of
$2,800,000, if the Company in any manner issues or sells Derivative
Securities at a conversion or exercise price which varies from time to
time while such Derivative Securities are outstanding with the market
price of the Common Stock (the formulation for such variable price being
herein referred to as the "Changing Price") and such Changing Price is
not calculated using the same formula used to calculate the Conversion
Period Conversion Price in effect immediately prior to the time of such
issue or sale, the Company shall provide written notice thereof via
facsimile and overnight courier to each holder of the shares of Preferred
Stock ("Changing Notice") on the date of issuance of such Derivative
Securities.  If the holders of shares of Preferred Stock representing at
least two-thirds (2/3) of the shares of Preferred Stock then outstanding
provide written notice via facsimile and overnight courier (the "Changing
Price Election Notice") to the Company within five (5) business days of
receiving a Changing Notice that such holders desire to replace the
Conversion Period Conversion Price then in effect with the Changing Price
described in such Changing Notice, then from and after the date of the
Company's receipt of the Changing Price Election Notice the Conversion
Period Conversion Price will automatically be replaced with the Changing
Price (together with such modifications to this Certificate of
Designations as may be required to give full effect to the substitution
of the Changing Price for the Conversion Period Conversion Price).  In
the event that a holder delivers a Conversion Notice at any time after
the Company's issuance of Derivative Securities with a Changing Price but
before such holder's receipt of the Company's Changing Notice, then such
holder shall have the option by written notice to the Company to rescind
such Conversion Notice or to have the Conversion Price be equal to such
Changing Price for the conversion effected by such Conversion Notice.


                        (e)     Adjustment for Reclassification, Exchange and
Substitution.  In the event that at any time or from time to time after
the Issuance Date, the Common Stock issuable upon the conversion of the
Preferred Stock is changed into the same or a different number of shares
of any class or classes of stock, whether by recapitalization,
reclassification or otherwise (other than a subdivision or combination of
shares or stock dividend or reorganization provided for elsewhere in this
Paragraph 10 or a merger, consolidation or other business transaction
provided for in Paragraph 5), then and in each such event each Holder
shall thereafter have the right upon conversion to receive the kind and
amount of shares of stock and other securities, cash and property
receivable upon such recapitalization, reclassification or other change,
by holders of the number of shares of Common Stock which the Holder of
shares of Preferred Stock would have received had it converted such shares
immediately prior to such recapitalization, reclassification or other
change, at the Conversion Price then in effect (the kind, amount and price
of such stock and other securities to be subject to adjustments as herein
provided).  Prior to the consummation of any recapitalization,
reclassification or other change contemplated hereby, the Company will
make appropriate provision (in form and substance satisfactory to the
Holders of a majority of the Preferred Stock then outstanding) to ensure
that each of the Holders of the Preferred Stock will thereafter have the
right to acquire and receive in lieu of or in addition to (as the case
may be) the shares of Common Stock otherwise acquirable and receivable
upon the conversion of such Holder's Preferred Stock, such shares of
stock, securities or assets that would have been issued or payable in
such recapitalization, reclassification or other change with respect to or
in exchange for the number of shares of Common Stock which would have
been acquirable and receivable upon the conversion of such Holder's
Preferred Stock had such recapitalization, reclassification or other
change not taken place (without taking into account any limitations or
restrictions on the timing or amount of conversions).  In the event of
such recapitalization, reclassification or other change, the formulae set
forth herein for conversion and redemption shall be equitably adjusted to
reflect such change in number of shares or, if shares of a new class of
stock are issued, to reflect the market price of the class or classes of
stock (applying the same factors used in determining the Conversion Price
for shares of Common Stock) issued in connection with the above described
events.


                        (f)     Reorganization.  If at any time or from time to
time after the Issuance Date there is a capital reorganization of the
Common Stock (other than a recapitalization, subdivision, combination,
reclassification or exchange of shares provided for elsewhere in this
Paragraph 10) then, as a part of such reorganization, provisions shall be
made so that the Holders shall thereafter be entitled to receive upon
conversion of its shares of Preferred Stock the number of shares of stock
or other securities or property to which a holder of the number of shares
of Common Stock deliverable upon conversion would have been entitled to
receive had the holder of shares of Preferred Stock converted such shares
immediately prior to such capital reorganization, at the Conversion Price
then in effect.  In any such case, appropriate adjustments shall be made
in the application of the provisions of this Paragraph 10 with respect to
the rights of the Holders after such capital reorganization to the extent
that the provisions of this Paragraph 10 shall be applicable after that
event and be as equivalent as may be practicable, including, by way of
illustration and not limitation, by equitably adjusting the formulae set
forth herein for conversion and redemption to reflect the market price of
the securities or property (applying the same factors used in determining
the Conversion Price for shares of Common Stock) issued in connection with
the above described events.


                        (g)     Certain Events.  If any event occurs of the type
contemplated by the provisions of this Paragraph 10 but not expressly
provided for by such provisions, then the Company's Board of Directors
will make an appropriate adjustment in the Conversion Price so as to
protect the rights of the holders of the Preferred Stock;  provided,
however, that no such adjustment will increase the Conversion Price as
otherwise determined pursuant to this Paragraph 10.


                        (h)     Dispute.  In the event of a dispute between a
Holder and the Company with respect to any of the adjustments required
pursuant to the provisions of this Paragraph 10, such Holder shall be
entitled to receive the number of shares of Common Stock as to which no
dispute exists and, within sixty (60) days of receipt of the Schedule of
Computations (as defined below), to submit such dispute to the American
Arbitration Association for resolution according to the then applicable
rules thereof, which determination shall be final and binding on all
parties.  If it shall be determined that a Holder should have received
additional shares of Common Stock or other securities upon such conversion
(the "Undelivered Shares") then, within three (3) trading days of receipt
of written notice of such determination, the Company shall issue to such
Holder that number of additional shares of Common Stock or other
securities as shall have a value, based upon the then Conversion Price for
shares of Common Stock, as shall equal the Undelivered Shares times the
Conversion Price for shares of Common Stock on the date of conversion.
The cost of such proceeding shall be borne by the Company, except that the
prevailing party, as determined by the arbitrator presiding over the
arbitration, shall be entitled to recover reasonable attorney's fees, in
addition to other costs and expenses and any other available remedy.


                        (i)     Schedule of Computations.  The Company shall
provide written notice to the Holders of all adjustments pursuant to this
Paragraph 10 shall be notified within three (3) trading days of the
occurrence thereof and such notice shall be accompanied by a schedule
setting forth a detailed calculation of such adjustments (the "Schedule of
Computations").  If so requested by a Holder, the Company shall provide to
such Holder within ten (10) business days of its request therefor a
certificate of concurrence to the Schedule of Computations by the
independent certified public accountants of the Company.






                     11.     Fractional Shares.  No fractional shares of Common
Stock or scrip representing fractional shares of Common Stock shall be
issuable hereunder.  The number of shares of Common Stock that are
issuable upon any conversion shall be rounded up or down to the nearest
whole share.


                     12.     Reservation of Stock; Conversion Default.




                        (a)     Reservation Requirement.  The Company shall at
all times reserve and keep available out of its authorized but unissued
shares of Common Stock such number of shares of Common Stock as shall be
necessary for the purpose of effecting the conversion of shares of
Preferred Stock, which shares shall be free of preemptive rights, for the
purpose of enabling the Company to satisfy any obligation to issue shares
of its Common Stock, or other securities, upon conversion of all shares
of Preferred Stock pursuant hereto. The Company shall initially reserve a
number of shares of Common Stock equal to one and one-half times the
number of shares necessary to satisfy its obligations on conversion of
the Preferred Stock if all such shares were converted on the Issuance
Date.  Furthermore, additional provisions pertaining to the reservation
of Common Stock set forth in Section 5.2 of the Subscription Agreement
shall be applicable and are specifically incorporated by reference
herein.


                        (b)     Default.  If the Company (i) notifies a Holder
via facsimile or pursuant to a public disclosure, including, but not
limited to a press release, that the Company cannot, or does not intend
to, or (ii) fails to, issue shares of Common Stock registered for resale
under the Registration Statement for any reason (a "Conversion Default"),
including, without limitation, because the Company (x) does not have a
sufficient number of shares of Common Stock or other securities
authorized and available, (y) is otherwise prohibited by applicable law
or by the rules and regulations of any stock exchange, interdealer
quotation system or other self-regulatory organization with jurisdiction
over the Company or its securities, including without limitation the
Exchange Cap (as defined in Paragraph 16), from issuing all of the Common
Stock which is to be issued to a Holder or (z) fails to effectuate a
resale by a Holder because there is an insufficient number of shares
covered by the Registration Statement, then the Company shall issue as
many shares of Common Stock as it is able to issue in accordance with
such Holder's Conversion Notice, and with respect to the unconverted
shares of Preferred Stock, notify the Holder of such failure (a "Default
Notice") which notice shall indicate (I) the reason why the Company is
unable to fully satisfy such holder's Conversion Notice, (II) the number
of shares of  Preferred Stock which cannot be converted and (III) the
applicable mandatory redemption price (as calculated pursuant to the
terms below).  Such Holder must within ten (10) business days of (i)
receipt of such Default Notice or (ii) becoming aware of such Conversion
Default, deliver written notice via facsimile to the Company ("Remedies
Notice") of its election pursuant to this Paragraph 12.


                        (c)     Each Holder pursuant to such Default Notice shall
have the following options pursuant to this Paragraph 12(c), at its
election:  (i)  the right to demand from the Company immediate redemption
of its shares of Preferred Stock in cash at 125% of the Aggregate Value;
(ii) if the Company's inability to fully convert Preferred Shares is
pursuant to subparagraph (b)(ii)(z) above, require the Company to issue
restricted shares of Common Stock in accordance with such Holder's
Conversion Notice; or (iii) void its Conversion Notice and have returned
the nonconverted shares of Preferred Stock that were to be converted
pursuant to such Holder's Conversion Notice.  Notwithstanding the
foregoing, no Remedies Notice may be delivered by a Holder subsequent to
receipt by such Holder of notice from the Company (sent by overnight or
two-day courier with a copy sent by facsimile) of the availability of
sufficient shares of Common Stock or other securities to perfect
conversion (a "Post-Default Conversion") of all the Preferred Stock;
provided that such rights as set forth herein and election as set forth
in the Remedies Notice shall be reinstated if the Company shall
thereafter fail to perfect such Post-Default Conversion by delivery of
Common Stock certificates or certificates representing other securities
in accordance with the applicable provisions hereof and payment of all
accumulated and unpaid dividends in cash with respect thereto within five
(5) days of delivery of the notice of Post-Default Conversion.


                        (d)     In addition to the foregoing, upon a Conversion
Default, the Holders shall have the right to receive a 2.0% reduction in
the Conversion Price of the Preferred Stock (including shares of
Preferred Stock for which a Conversion Notice has not yet been sent) for
each thirty (30) day period (or part thereof) following a Conversion
Default;  provided, however, that if the Company's inability to fully
convert shares of the Preferred Stock is pursuant to subparagraph
(b)(ii)(y) above, the Company shall have sixty (60) days to cure such
default prior to giving rise to the right of the Holder to exercise
remedies pursuant to this Paragraph 12.






                     13.     Taxes.  The Company shall pay any and all taxes
attributable to the issuance and delivery of Common Stock or other
securities upon conversion of the Preferred Stock.


                     14.     Voting Rights.  The Holders shall have no voting
rights, except as required by law, including but not limited to the
Delaware General Corporation Law, and as expressly provided in this
Certificate of Designations.


                     15.     Liquidation, Dissolution, Winding-Up.  (a)  In the
event of any voluntary or involuntary liquidation, dissolution or winding
up of the Company, the Holders shall be entitled to receive in cash out
of the assets of the Company, whether from capital or from earnings
available for distribution to its stockholders (the "Preferred Funds"),
before any amount shall be paid to the holders of any Common Stock or any
Junior Securities, an amount per share of Preferred Stock equal to the
Aggregate Value (the "Liquidation Value"); provided that, if the
Preferred Funds are insufficient to pay the full amount due to the
Holders and any holders of Parity Securities, then each Holder and each
holder of Parity Securities shall receive a ratable percentage of the
Preferred Funds in accordance with the respective amounts that would be
payable in full to such holder as a liquidation preference, in accordance
with their respective Certificate of Designation, Preferences and Rights.




                        (b)     The purchase or redemption by the Company of
stock of any class, in any manner permitted by law, shall not, for the
purposes hereof, be regarded as a liquidation, dissolution or winding up
of the Company.  Neither the consolidation or merger of the Company with
or into any other person, nor the sale or transfer by the Company of less
than substantially all of its assets, shall, for the purposes hereof, be
deemed to be a liquidation, dissolution or winding up of the Company.


                        (c)     No Holder shall be entitled to receive any
amounts with respect thereto upon my liquidation, dissolution or winding
up of the Company other than the amounts provided for herein.





                     16.     Limitation on Number of Conversion Shares.  (a)  The
Company shall not be obligated to issue upon conversion of the shares of
Preferred Stock, in the aggregate, more than a number of shares of Common
Stock equal to 19.99% of the number of shares of Common Stock outstanding
on the Issuance Date (such amount to be proportionately and equitably
adjusted from time to time in the event of stock splits, stock dividends,
combinations, reverse stock splits, reclassification, capital
reorganization and similar events relating to the Common Stock) (the
"Exchange Cap"), if issuance of a larger number of shares of Common Stock
would constitute a breach of the Company's obligations under the rules or
regulations of The Nasdaq SmallCap Market or any other principal
securities exchange or market upon which the Common Stock is or becomes
traded.  The Exchange Cap shall be allocated among the Holders pro rata
based on the total number of outstanding shares of Preferred Stock.




                        (b)     Notwithstanding anything to the contrary
contained herein, after giving effect to the issuance of Common Stock
pursuant to each Conversion Notice, the total number of shares of Common
Stock deemed beneficially owned by the Holder submitting such Conversion
Notice (excluding shares that might otherwise be deemed beneficially
owned by reason of the conversion right in the Preferred Stock owned by
such Holder), together with all shares of Common Stock deemed
beneficially owned by such Holder's "affiliates" as defined in Rule 144
of the Securities Act, shall not exceed 4.99% of the total issued and
outstanding shares of the Common Stock.





                     17.     No Reissuance of Preferred Stock.  No shares of
Preferred Stock acquired by the Company by reason of redemption,
purchase, conversion or otherwise shall be reissued, and all such
Preferred Stock shall be retired.


                     18.     No Impairment.  The Company shall not intentionally
take any action which would impair the rights and privileges of the
Preferred Stock set forth herein or the rights of the Holders thereof.


                     19.     Registration Suspension.  In the event that at any time
or from time to time any Registration Statement is suspended or trading
in the Common Stock on the Nasdaq National Market is suspended for a
period of time (excluding disruptions from business announcements that
result in any halt(s) in trading of not more than one (1) day on each
occasion) and other suspension of trading on such market in general
(each, a "Blackout Period"), the Maturity Date hereunder shall be
extended for a period equal to l.5 times the number of days in such
Blackout Period.  Furthermore, additional provisions pertaining to the
suspension of effectiveness of such registration statement set forth in
Section 5A of the Registration Rights Agreement shall be applicable in
the event of a Blackout Period, and such provisions as specifically
incorporated by reference herein.


                     20.     Replacement Certificate.  In the event that any Holder
notifies the Company that a stock certificate evidencing shares of
Preferred Stock has been lost, stolen, destroyed or mutilated, the
Company shall issue a replacement stock certificate evidencing the
Preferred Stock identical in tenor and date (or if such certificate is
being issued for shares not covered in a redemption or conversion, in the
applicable tenor and date) to the original stock certificate evidencing
the Preferred Stock, provided that the Holder executes and delivers to
the Company an affidavit of lost stock certificate and an agreement
reasonably satisfactory to the Company to indemnify the Company from any
loss incurred by it in connection with such Preferred Stock stock
certificate; provided, however, the Company shall not be obligated to
re-issue replacement stock certificates if the Holder contemporaneously
requests the Company to convert or redeem the full number of shares
evidenced by such lost, stolen, destroyed or mutilated certificate.


                     IN WITNESS WHEREOF, the Company has caused this Certificate
of Designations to be duly executed by an officer thereunto duly
authorized this 30th day of December, 1999.



             CENTURA SOFTWARE CORPORATION



             By: _______________________________

                    Name: 

                    Title:





















                                        EXHIBIT 1



                                HOLDER REDEMPTION NOTICE



Reference is made to the Certificate of Designation, Preferences and
Rights (the "Certificate of Designations") of Centura Software
Corporation, a Delaware corporation (the "Company").  In accordance with
and pursuant to the Certificate of Designations, the undersigned hereby
elects to have the Company redeem the number of shares of Series A
Cumulative Convertible Preferred Stock, par value $.01 per share (the
''Preferred Stock"), of the Company, indicated below by tendering the
stock certificate(s) representing the share(s) of Preferred Stock
specified below as of the date specified below.


Date of Redemption:


Number of shares of
Preferred Stock to be redeemed:



Stock certificate no(s). of
Preferred Stock to be redeemed:


Please confirm the following information:


Redemption Price:


The undersigned holder hereby represents, warrants and reaffirms to the
Company, as of the date hereof, the accuracy of the representations and
warranties made by it in Article 2 of the Subscription Agreement dated
December 30, 1999 executed by the undersigned and accepted by the
Company.


Please issue any check drawn on an account of the Company into which the
Preferred Stock are being redeemed, and, if applicable, issue any shares
of Preferred Stock, in the following name and to the following address:


Pay to:





Facsimile Number:


Authorization:          

             By:             

             Title:



Dated:



















                                            EXHIBIT 2



                              COMPANY REDEMPTION NOTICE



Reference is made to the Certificate of Designation, Preferences and
Rights (the "Certificate of Designations") of Centura Software
Corporation, a Delaware corporation (the "Company").  In accordance with
and pursuant to the Certificate of Designations, the Company hereby
elects to redeem the number of shares of Series A Cumulative Convertible
Preferred Stock, par value $.01 per share (the ''Preferred Stock"), of
the Company in accordance with the information set forth below.  Please
tender the stock certificate(s) representing the share(s) of Preferred
Stock specified below as of the Redemption Date.


Date of Redemption:


Company Redemption Price:


CENTURA SOFTWARE CORPORATION



By:________________________________

     
        Name:

     
        Title:


Dated:




















                                     EXHIBIT 3



                              HOLDER CONVERSION NOTICE




Reference is made to the Certificate of Designation, Preferences and
Rights (the "Certificate of Designations") of Centura Software
Corporation, a Delaware corporation (the "Company").  In accordance with
and pursuant to the Certificate of Designations, the undersigned hereby
elects to have the Company convert the number of shares of Series A
Cumulative Convertible Preferred Stock, par value $.01 per share (the
"Preferred Stock"), of the Company, indicated below into shares of Common
Stock, par value $0.01 per share (the "Common Stock"), of the Company, by
tendering the stock certificate(s) representing the share(s) of Preferred
Stock specified below as of the date specified below.



Date of Conversion:


Number of Preferred Stock to be redeemed:



Stock certificate no(s). of

Preferred Stock to be converted:


Please confirm the following information:


Redemption Price:


Please issue the Common Stock and, if applicable, any check drawn on an
account of the Company into which the Preferred Stock are being converted
in the following name and to the following address:


Issue to:





Facsimile Number:


Authorization:
     
        By:

     
        Title:


Dated:




















                                         EXHIBIT 4



                              COMPANY ELECTION CONVERSION NOTICE



Reference is made to the Certificate of Designation, Preferences and
Rights (the "Certificate of Designations") of Centura Software
Corporation, a Delaware corporation (the "Company").  In accordance with
and pursuant to the Certificate of Designations, the Company hereby
elects to have the Holders convert the number of shares of Series A
Cumulative Convertible Preferred Stock, par value $.01 per share (the
"Preferred Stock"), of the Company, having an Aggregate Value indicated
below into shares of Common Stock, par value $0.01 per share (the "Common
Stock"), of the Company.



Aggregate Value of the Preferred Stock
selected for conversion:


Company Election Conversion Period:

        From:   ______________________________


        To:     ______________________________


Company Election Conversion Period

Commencement Date:      ______________________________


Holder's Pro Rata Conversion Amount:    ______________________________



CENTURA SOFTWARE CORPORATION



By:____________________________



     
        Name:

     
        Title: