**CERTIFICATE
      OF DESIGNATION**


**(PURSUANT
      TO NRS 78.1955)**





**Certificate
      of Designation**


**For
      Nevada Profit Corporation**


**(Pursuant
      to NRS 78.1955)**





**1.**
            **Name
                of Corporation:**  LEGACY COMMUNICATIONS
              CORPORATION





**2.**
            **By
                resolution of the board of directors pursuant to a provision in the
                articles of incorporation, this certificate establishes the following
                regarding the voting powers, designations, preferences, limitations,
                restrictions and relative rights of the following class or series
                of
                stock.**  PER ATTACHED EXHIBIT
              A





**3.**
            **Effective
                date of filing (optional):**





**4.**
            **Officer
                Signature (Required):**/s/
                E. Morgan Skinner,
                Jr.





**Filing
      Fee: $175.00**





**IMPORTANT:
      Failure to include any of the above information and submit the proper fees
      may
      cause this filing to be rejected.**  Page
            1


**EXHIBIT
      A TO**





**CERTIFICATE
      OF DESIGNATION**


**of**


**SERIES
      A CONVERTIBLE REDEEMABLE PREFERRED STOCK**


**of**


**LEGACY
      COMMUNICATIONS CORPORATION**


(pursuant
      to NRS 78.1955)





Legacy
      Communications Corporation, a Nevada corporation (the “ Corporation ”),
      pursuant to Section 78.1955 of the Nevada Revised Statutes (the “ NRS ”),
      hereby certifies that the following resolution was adopted by the Board of
      Directors of the Corporation pursuant to the authority granted by the
      Corporation’s Restated Articles of Incorporation:





RESOLVED,
      that pursuant to the authority expressly granted to and vested in the Board
      of
      Directors of the Corporation (the “ Board
      of Directors ”)
      by the
      provisions of the Restated Articles of Incorporation of the Corporation (the
      “ Articles
      of Incorporation ”),
      there
      is hereby created, out of the 5,000,000 shares of preferred stock, par value
      $0.001 per share, of the Corporation authorized in Article IV of the Articles
      of
      Incorporation (the “ Preferred
      Stock ”),
      a
      series of the Preferred Stock consisting of 185,000 shares, which series shall
      have the following powers, designations, preferences and relative,
      participating, optional or other rights, and the following qualifications,
      limitations and restrictions (in addition to any powers, designations,
      preferences and relative, participating, optional or other rights, and any
      qualifications, limitations and restrictions, set forth in the Articles of
      Incorporation which are applicable to the Preferred Stock):





1.  Designation
      and Amount .  There
      shall be a series of Preferred Stock designated as “ Series
      A Convertible Redeemable Preferred Stock ,”
and
      the number of shares constituting such series shall be 185,000 shares. Such
      series is referred to herein as the “ Series
      A Preferred Stock ”.





2.  Stated
      Capital; Stated Value .  The
      amount to be represented in stated capital at all times for each share of Series
      A Preferred Stock shall be $.001 per share. The Stated Value shall equal $1.00
      per share.





3.  Dividends .  The
      Series A Preferred Stock shall not be entitled to receive dividends or other
      distributions by the Corporation except for distributions upon liquidation,
      dissolution or winding up as set forth in these Designations.





4.  Liquidation
      Preference .  In
      the event of a liquidation, dissolution or winding up of the Corporation,
      whether voluntary or involuntary, the assets of the Corporation available for
      distribution to stockholders, whether such assets are stated capital or surplus
      of any nature, shall be distributed first among the holders of Series A
      Preferred Stock, until the Holders of Series A Preferred Stock shall have
      received a liquidation preference payment (the “ Liquidation
      Preference ”)
      equal
      to the Stated Value, plus an amount equal to the product of (a) the Stated
      Value
      times (b) 12.5%. After the payment of the Liquidation Preference has been made,
      the remaining assets of the Corporation, if any, available for distribution
      to
      stockholders shall be distributed pro-rata among the holders of the Common
      Stock. Neither a consolidation or merger of the Corporation with another
      corporation nor a sale or transfer of all or part of the Corporation’s assets
      for cash, securities or other property will be considered a liquidation,
      dissolution or winding up of the Corporation.  Page
            2


5.  Voting
      Rights .





(a)  General .  At
      every meeting of the stockholders or upon any action taken by stockholders
      with
      or without a meeting, each Holder of Series A Preferred Stock shall be entitled
      to 200 votes in person or by proxy for each share of Series A Preferred Stock
      standing in his or her name on the transfer books of the Corporation; provided,
      however, that the aggregate votes that may be cast by any Holder or any group
      (as defined in Rule 13d-5 under the Exchange Act) with respect to Series A
      Preferred Stock held by such Holder or the members of such group shall not
      exceed 4.99% of the aggregate voting interest of the Series A Preferred Stock
      and the Common Stock then outstanding until such time as all shares of Series
      A
      Preferred Stock authorized by these Designations have been issued by the
      Corporation after which this proviso shall no longer apply.





(b)  Class
      Voting Rights .  Without
      the affirmative vote of the Holders of at least a majority of the outstanding
      shares of the Series A Preferred Stock, voting as a single class (or, if less
      than all shares of the Series A Preferred Stock then outstanding would be
      adversely affected thereby, without the affirmative vote of the Holders of
      at
      least a majority of the outstanding shares of the series so affected, voting
      as
      a separate class), the Corporation may not





(i)
      amend
      the Corporation’s Articles of Incorporation or these Designations so as to
      adversely affect the voting powers or other rights or preferences of shares
      of
      the Series A Preferred Stock;





(ii)
      increase the total number of shares of Series A Preferred Stock; or





(iii)
      create or issue any series or class of capital stock, reclassify any authorized
      capital stock of the Corporation into stock of any other series or class, or
      increase the authorized and unissued amount of any class or series of stock
      that, in each case, ranks prior to the Series A Preferred Stock.





6.  Conversion
      Privilege .





(a)  Right
      of Conversion .  Each
      share of Series A Preferred Stock shall be convertible by the Holder thereof
      after July 1, 2008 into 200 shares of Common Stock; provided, however, that
      (i)
      the Corporation has failed to (A) file its Annual Report on Form 10-KSB for
      the
      year ended December 31, 2007 on or before April 30, 2008; (B) file when due
      all
      other reports require required to be filed prior to July 1, 2008 with the
      Securities and Exchange Commission (the “ SEC ”)
      by
      issuers having a class of securities registered under Section 12(g) of the
      Exchange Act; (C) file a timely and adequate response to comments received
      from
      the SEC with respect to any report or registration statement filed with the
      SEC
      prior to July 1, 2008; (D) obtain a complete release from any outstanding
      indebtedness; (D) maintain the eligibility of its Common Stock for quotation
      on
      the Over-the-Counter Bulletin Board; (F) provide the Holders of the Series
      A
      Preferred Stock any information requested in writing within 15 days after
      receipt of such request; or (G) perform any other actions as are necessary
      to
      maintain the registration of the Common Stock with the SEC; (ii) such conversion
      ratio shall be adjusted as necessary such that the fair market value (determined
      in accordance with Section 6(c)(v) of these Designations) of the shares of
      Common Stock issued upon conversion of each share of Series A Preferred shall
      not exceed the Liquidation Premium on the day of conversion; and (iii) the
      Corporation has sufficient authorized and unissued and unreserved shares of
      Common Stock at the time of conversion. The foregoing proviso sections (i)
      and
      (ii) shall not apply after all shares of Series A Preferred stock authorized
      by
      these Designations have been issued by the Corporation.  Page
            3


(b)  Conversion
      Procedure .  Any
      Holder of shares of Series A Preferred Stock desiring to convert such shares
      into Common Stock shall surrender the certificate or certificates for such
      shares of Series A Preferred Stock at the office of the transfer agent for
      the
      Series A Preferred Stock, which certificate or certificates, if the Corporation
      shall so require, shall be duly endorsed to the Corporation or in blank, or
      accompanied by proper instruments of transfer to the Corporation or in blank,
      accompanied by irrevocable written notice (a “ Notice
      of Conversion ”)
      to the
      Corporation that the Holder elects so to convert such shares of Series A
      Preferred Stock, specifying the name or names (with address) in which a
      certificate or certificates for Common Stock are to be issued, and stating
      which
      provision of Section 6(a) governs such conversion.





Within
      three (3) trading days after receipt of a Notice of Conversion and certificates
      of Series A Preferred Stock, duly endorsed or accompanied by proper instruments
      of transfer as set forth in Section 6(b), the Corporation will either (i)
      deliver at the office of the transfer agent to the person for whose account
      such
      shares of Series A Preferred Stock were so surrendered, or to his nominee or
      nominees, certificates for the number of full shares of Common Stock to which
      he
      shall be entitled as aforesaid, together with a cash adjustment of any fraction
      of a share as hereinafter provided, (ii) notify the Holder that there are not
      sufficient authorized and unissued shares of Common Stock to complete such
      conversion, or (iii) notify the Holder of any dispute regarding the provision
      of
      Section 6(a) governing such conversion. Any such dispute shall be resolved
      within ten (10) trading days by binding arbitration in accordance with these
      Designations.





Subject
      to the following provisions of this paragraph, such conversion shall be deemed
      to have been made as of the date of such surrender of the shares of Series
      A
      Preferred Stock to be converted, and the person or person entitled to receive
      the Common Stock deliverable upon conversion of such Series A Preferred Stock
      shall be treated for all purposes as the record holder or holders of such Common
      Stock on such date; *provided,
      however,* that
      the
      Corporation shall not be required to convert any shares of Series A Preferred
      Stock while the stock transfer books of the Corporation are closed for any
      purpose, but the surrender of Series A Preferred Stock for conversion during
      any
      period while such books are so closed shall become effective for conversion
      immediately upon the reopening of such books as if the surrender had been made
      on the date of such reopening, and the conversion shall be at the conversion
      rate in effect on such date.





(c)  Adjustment
      of Conversion Rate .  The
      number of shares of Common Stock and number or amount of any other securities
      and property as hereinafter provided into which a share of Series A Preferred
      Stock is convertible (the “ conversion
      rate ”)
      shall
      be subject to adjustment from time to time as follows:  Page
            4


(i)
      In
      case the Corporation shall (1) subdivide its outstanding shares of Common Stock
      into a greater number of shares, or (2) distribute as a dividend to the holders
      of its Common Stock additional shares of Common Stock or securities convertible
      into or exchangeable for shares of its Common Stock to the holders of the Common
      Stock, then in either such case the conversion rate in effect immediately prior
      thereto shall be adjusted retroactively by multiplying the conversion rate
      by a
      fraction, (A) the numerator of which is the number of shares of Common Stock
      that is outstanding immediately following and after giving effect to such
      transaction and the denominator of which is the number of shares of Common
      Stock
      outstanding immediately prior to and before giving effect to such transaction.
      An adjustment made pursuant to this subparagraph (i) shall become effective
      immediately on the record date of a subdivision, dividend, or
      distribution.





(ii)
      In
      case the Corporation shall combine its outstanding shares of Common Stock into
      a
      lesser number of outstanding shares by any means, including but not limited
      to
      (1) the filing in the office of the Secretary of State of its incorporation,
      or
      such other state in which the Corporation is legally domiciled, of an amendment
      to (or amendment and restatement of) the Articles of Incorporation or other
      charter document of the Corporation, (2) a merger with or into another
      corporation that causes a change in the legal domicile of the Corporation,
      or
      (3) a *pro
      rata* reduction
      in the total number of issued and outstanding shares of Common Stock of the
      Corporation then in any such case the conversion rate in effect immediately
      prior thereto shall not be adjusted and the Holder of any shares of Series
      A
      Preferred Stock thereafter surrendered for conversion shall be entitled to
      receive the same number of shares of Common Stock of the Corporation after
      such
      event which such Holder would have been entitled to receive before the happening
      of any of the events described above.





(iii)
      In
      case the Corporation shall issue rights or warrants to all holders of its Common
      Stock entitling them to subscribe for or purchase shares of Common Stock at
      a
      price per share less than the current market price per share (determined as
      provided below) of the Common Stock on the date fixed for the determination
      of
      stockholders entitled to receive such rights or warrants, or shall sell any
      shares of Common Stock at a price per share less than the current market price
      per share, then the conversion rate in effect at the opening of business on
      the
      day following the date fixed for such determination shall be increased by
      multiplying such conversion rate by a fraction the numerator of which shall
      be
      the number of shares of Common Stock outstanding at the close of business on
      the
      date fixed for such determination plus the number of shares of Common Stock
      so
      offered for subscription or purchase (or issuable upon the exercise of any
      warrant or other rights) and the denominator shall be the number of shares
      of
      Common Stock outstanding at the close of business on the date fixed for such
      determination plus the number of shares of Common Stock which the aggregate
      of
      the offering price of the total number of shares of Common Stock so offered
      for
      subscription or purchase would purchase at such current market price, such
      increase to become effective immediately after the opening of business on the
      day following the date fixed for such determination; *provided,
      however,* in
      the
      event that all the shares of Common Stock offered for subscription or purchase
      are not delivered upon the exercise of such rights or warrants, upon the
      expiration of such rights or warrants the conversion rate shall be readjusted
      to
      the conversion rate which would have been in effect had the numerator and the
      denominator of the foregoing fraction and the resulting adjustment been made
      based upon the number of shares of Common Stock actually delivered upon the
      exercise of such rights or warrants rather than upon the number of shares of
      Common Stock offered for subscription or purchase (or issuable upon exercise).  Page
            5


(iv)
      In
      case the Corporation shall, by dividend or otherwise, distribute to all holders
      of its Common Stock evidences of its indebtedness, cash (excluding ordinary
      cash
      dividends paid out of retained earnings of the Corporation), other assets or
      rights or warrants to subscribe for or purchase any security (excluding those
      referred to in subparagraphs (i) and (iii) above), then in each such case the
      conversion rate shall be adjusted retroactively so that the same shall equal
      the
      rate determined by multiplying the conversion rate in effect immediately prior
      to the close of business on the date fixed for the determination of stockholders
      entitled to receive such distribution by a fraction the numerator of which
      shall
      be the current market price per share (determined as provided below) of the
      Common Stock on the date fixed for such determination and the denominator shall
      be such current market price per share of the Common Stock less the amount
      of
      cash and the then fair market value (as determined by the Board of Directors,
      whose determination shall be conclusive and described in a resolution of the
      Board of Directors) of the portion of the assets, rights or evidences of
      indebtedness so distributed applicable to one share of Common Stock, such
      adjustment to become effective immediately prior to the opening of business
      on
      the day following the date fixed for the determination of stockholders entitled
      to receive such distribution.





(v)
      For
      the purpose of any computation under this Section 6, the current market price
      per share of Common Stock on any date shall be deemed to be the average of
      the
      daily closing prices for the five (5) consecutive trading days commencing with
      the 1st trading day before the day in question. The closing price for each
      day
      shall be the reported last sales price regular way or, in case no such reported
      sale takes place on such day, the average of the reported highest closing bid
      and lowest closing asked prices regular way, in either case on the market on
      which the Common Stock trades in the following order: (1) the principal national
      securities exchange on which the Common Stock is listed or admitted to trading
      (based on the aggregate dollar value of all securities listed or admitted to
      trading, (2) the Over the Counter Bulletin Board, or (3) in a manner established
      by the Board of Directors of the Corporation in good faith. “Trading day” shall
      mean a day on which the market on which the market used to determine the closing
      price is open for the transaction of business or the reporting of trades or,
      if
      the closing price is not so determined, a day on which the New York Stock
      Exchange is open for the transaction of business.





(vi)
      No
      adjustment in the conversion rate shall be required unless such adjustment
      would
      require an increase of at least 1% in such rate; *provided,
      however,* that
      the
      Corporation may make any such adjustment at its election; *and
      provided further,* that
      any
      adjustments which by reason of this subparagraph (vi) are not required to be
      made shall be carried forward and taken into account in any subsequent
      adjustment. All calculations under this Section 6 shall be made to the nearest
      cent or to the nearest one-hundredth of a share, as the case may be.  Page
            6





(vii)
      Whenever the conversion rate is adjusted as provided in any provision of this
      Section 6: (1) the Corporation shall compute the adjusted conversion rate in
      accordance with this Section 6 and shall prepare a certificate signed by the
      principal financial officer of the Corporation setting forth the adjusted
      conversion rate and showing in reasonable detail the facts upon which such
      adjustment is based, and such certificate shall forthwith be filed with the
      transfer agent of the Series A Preferred Stock; and (2) a notice stating that
      the conversion rate has been adjusted and setting forth the adjusted conversion
      rate shall forthwith be required, and as soon as practicable after it is
      required, such notice shall be mailed by the Corporation to all record Holders
      of Series A Preferred Stock at then last addresses as they shall appear in
      the
      stock transfer books of the Corporation.





(d)  No
      Fractional Shares .  No
      fractional shares or scrip representing fractional shares of Common Stock shall
      be issued upon conversion of Series A Preferred Stock. If more than one
      certificate representing shares of Series A Preferred Stock shall be surrendered
      for conversion at one time by the same Holder, the number of full shares
      issuable upon conversion thereof shall be computed on the basis of the aggregate
      number of shares of Series A Preferred Stock so surrendered. Instead of any
      fractional share of Common Stock which would otherwise be issuable upon
      conversion of any shares of Series A Preferred Stock, the Corporation will
      pay a
      cash adjustment in respect of such fractional interest in an amount equal to
      the
      same fraction of the market price per share of Common Stock.





(e)  Reclassification;
      Consolidation; Merger or Sale of Assets .  In
      case of any reclassification of the Common Stock, any consolidation of the
      Corporation with, or merger of the Corporation into, any other person, any
      merger of another person into the Corporation (other than a merger which does
      not result in any reclassification, conversion, exchange or cancellation of
      outstanding shares of Common Stock of the Corporation), any sale or transfer
      of
      all or substantially all of the assets of the Corporation or any compulsory
      share exchange pursuant to which share exchange the Common Stock is converted
      into other securities, cash or other property, then lawful provision shall
      be
      made as part of the terms of such transaction whereby the Holder of each share
      of Series A Preferred Stock then outstanding shall be entitled to receive such
      securities, cash or other property as he would be entitled to receive, and
      shall
      be entitled to make such elections with respect to the manner or type of
      consideration to be received, as if all shares of the Series A Preferred Stock
      held by such Holder had been converted to shares of Common Stock of the
      Corporation immediately prior to such reclassification, merger, sale, transfer
      or share exchange, and assuming such Holder is not a person with which the
      Corporation consolidated or into which the Corporation merged or which merged
      into the Corporation, to which such sale or transfer was made or a party to
      such
      share exchange, as the case may be (“ constituent
      person ”),
      or an
      affiliate of a constituent person. The Corporation, the person formed by such
      consolidation or resulting from such merger or which acquires such assets or
      which acquires the Corporation’s shares, as the case maybe, shall make
      provisions in its certificate or articles of incorporation or other constituent
      document to establish such right. Such certificate or articles of incorporation
      or other constituent document shall provide for adjustments which, for events
      subsequent to the effective date of such certificate or articles of
      incorporation or other constituent document, shall be as nearly equivalent
      as
      may be practicable to the adjustments provided for in this Section 6. The above
      provisions shall similarly apply to successive reclassifications,
      consolidations, mergers, sales, transfers or share exchanges.  Page
            7


(f)  Reservation
      of Shares; Transfer Taxes; Etc .  The
      Corporation shall at all times reserve and keep available, out of its authorized
      and unissued stock, solely for the purpose of effecting the conversion of the
      Series A Preferred Stock, such number of shares of its Common Stock free of
      preemptive rights as shall from time to time be sufficient to effect the
      conversion of all shares of Series A Preferred Stock from time to time
      outstanding. The Corporation shall from time to time, in accordance with the
      laws of the State of its incorporation, increase the authorized number of shares
      of Common Stock if at any time the unissued and unreserved shares of Common
      Stock shall not be sufficient to permit the conversion of all the then
      outstanding shares of Series A Preferred Stock at the conversion rate then
      in
      effect and, upon such increase, all shares of Series A Preferred Stock
      previously presented for conversion that have not been converted because there
      was not sufficient authorized and unissued shares of Common Stock when the
      Notice of Conversion was received by the Corporation shall be automatically
      converted into shares of Common Stock at the conversion rate in effect on the
      date of such increase in authorized and unissued and unreserved Common Stock
      as
      if the Notice of Conversion was received on such date.





If
      any
      shares of Common Stock required to be reserved for purposes of conversion of
      the
      Series A Preferred Stock hereunder require registration with or approval of
      any
      governmental authority under any Federal or State law before such shares may
      be
      issued upon conversion, the Corporation will in good faith and as expeditiously
      as possible endeavor to cause such shares to be duly registered or approved,
      as
      the case may be. If the Common Stock is listed on any national securities
      exchange, the Corporation will, if permitted by the rules of such exchange,
      list
      and keep listed on such exchange, upon official notice of issuance, all shares
      of Common Stock issuable upon conversion of the Series A Preferred
      Stock.





The
      Corporation will pay any and all issue or other taxes that may be payable in
      respect of any issue or delivery of shares of Common Stock on conversion of
      the
      Series A Preferred Stock. The Corporation shall not, however, be required to
      pay
      any tax which may be payable in respect of any transfer involved in the issue
      or
      delivery of Common Stock (or other securities or assets) in a name other than
      that which the shares of Series A Preferred Stock so converted were registered,
      and no such issue or delivery shall be made unless and until the person
      requesting such issue has paid to the Corporation the amount of such tax or
      has
      established, to the satisfaction of the Corporation, that such tax has been
      paid.





(g)  Prior
      Notice of Certain Events .  If
      the Corporation shall (i) declare any dividend (or any other distribution)
      on
      its Common Stock, other than a dividend payable in shares of Common Stock or
      other securities of the Corporation, (ii) declare or authorize a redemption
      or
      repurchase of the then-outstanding shares of Common Stock; (iii) reclassify
      its
      Common Stock (other than a subdivision or combination of the outstanding Common
      Stock, or a change in par value, or from par value to no par value, or from
      no
      par value to par value), (iv) consolidate or merge with any person for which
      approval of any stockholders of the Corporation shall be required, (v) sell
      or
      transfer all or substantially all of the assets of the Corporation, (vi) engage
      in any other transaction in which the Common Stock or the assets of the
      Corporation is converted into other securities, cash or other property; (vii)
      file for voluntary protection from its creditors under any bankruptcy or
      insolvency laws or take any action to dissolve, liquidate or wind up, or (viii)
      have filed against it any involuntary action in bankruptcy or insolvency or
      seeking the dissolution, liquidation or winding up of the Corporation and such
      action shall not be stayed or dismissed within 90 days (each a “ Default ”),
      the
      Corporation shall cause to be filed with the transfer agent for the Series
      A
      Preferred Stock, and shall cause to be mailed to the Holders of record of the
      Series A Preferred Stock, at their last address as they shall appear upon the
      stock transfer books of the Corporation, at least 15 days prior to the
      applicable record date hereinafter specified, a notice stating (A) the date
      on
      which a record is to be taken for the purpose of such dividend, distribution,
      redemption or granting of rights or warrants or, if a record is not to be taken,
      the date as of which the holders of Common Stock of record to be entitled to
      such dividend, distribution, redemption, rights or warrants are to be
      determined, or (B) the date on which such reclassification, consolidation,
      merger, sale, transfer, share exchange, dissolution, liquidation or winding
      up
      is expected to become effective, and the date as of which it is expected that
      holders of Common Stock of record shall be entitled to exchange their shares
      of
      Common Stock for securities or other property deliverable upon such
      reclassification, consolidation, merger, sale, transfer, share exchange,
      dissolution, liquidation or winding up (but no failure to mail such notice
      or
      any defect therein or in the mailing thereof shall affect the validity of the
      corporate action required to be specified in such notice).  Page
            8


(h)  Limitation
      on Conversion Rights .  The
      Corporation shall not effect any conversion under this Section 6, and a Holder
      of shares of Series A Preferred Stock shall not have the right to convert any
      Series A Preferred Stock, to the extent that after giving effect to the issuance
      of Common Stock upon such conversion, such Holder (together with such Holder’s
      affiliates, and any other person or entity acting as a group together with
      such
      Holder or any of such Holder’s affiliates) would beneficially own in excess of
      4.99% of the issued and outstanding Common Stock of the Corporation. For
      purposes of this Section 6(h), the number of shares of Common Stock beneficially
      owned by such Holder and its affiliates shall include the number of shares
      of
      Common Stock issuable upon conversion of all Series A Preferred Stock with
      respect to which such determination is being made, but shall exclude the number
      of shares of Common Stock which would be issuable upon (i) the conversion of
      such non-converted Series A Preferred Stock beneficially owned by such Holder
      or
      any of its affiliates and (ii) exercise or conversion of the unexercised or
      nonconverted portion of any other securities of the Corporation subject to
      a
      limitation on conversion or exercise analogous to the limitation contained
      herein beneficially owned by such Holder or any of its affiliates.  Except
      as set forth in the preceding sentence, for purposes of this Section 6(h),
      beneficial ownership shall be calculated in accordance with Section 13(d) of
      the
      1934 Act and the rules and regulations promulgated thereunder, it being
      acknowledged by a Holder that the Corporation is not representing to such Holder
      that such calculation is in compliance with Section 13(d) of the 1934 Act and
      such Holder is solely responsible for any schedules required to be filed in
      accordance therewith.





7.  Optional
      Redemption by Corporation .
      At any
      time from and after July 1, 2008, the Corporation may, at its option, redeem
      the
      issued and outstanding shares of Series A Preferred Stock for (i) an amount
      in
      cash per share equal to the Liquidation Value if (i) the Corporation has failed
      to (A) file its Annual Report on Form 10-KSB for the year ended December 31,
      2007 on or before April 30, 2008; (B) file when due all other reports require
      required to be filed prior to July 1, 2008 with the Securities and Exchange
      Commission (the “ SEC ”)
      by
      issuers having a class of securities registered under Section 12(g) of the
      Exchange Act; (C) file a timely and adequate response to comments received
      from
      the SEC with respect to any report or registration statement filed with the
      SEC
      prior to July 1, 2008; (D) obtain a complete release from any outstanding
      indebtedness; (D) maintain the eligibility of its Common Stock for quotation
      on
      the Over-the-Counter Bulletin Board; (F) provide the Holders of the Series
      A
      Preferred Stock any information requested in writing within 15 days after
      receipt of such request; or (G) perform any other actions as are necessary
      to
      maintain the registration of the Common Stock with the SEC or (ii)
      1/1000 th share of
      Common Stock in all other events.. The right of the Corporation to redeem the
      Series A Preferred Stock under this provision shall terminate and the Series
      A
      Preferred Stock shall become non-redeemable immediately upon the issuance of
      all
      Series A Preferred Stock authorized by these Designations.  Page
            9


8.  Securities
      Not Registered Under the Securities Act of 1933 .  Neither
      the shares of Series A Preferred Stock nor the Common Stock issuable upon
      conversion thereof has been registered under the Securities Act of 1933 (the
      “ Act ”)
      or the
      laws of any state of the United States and may not be transferred without such
      registration or an exemption from registration.





(a)  Restrictive
      Legends .  Each
      share of Series A Preferred Stock and certificate for Common Stock issued upon
      the conversion of any shares of Series A Preferred Stock, and each preferred
      stock certificate issued upon the transfer of any such shares of Series A
      Preferred Stock or Common Stock (except as otherwise permitted by this Section
      8), shall be stamped or otherwise imprinted with a legend in substantially
      the
      following form:


THE
        SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
        ACT
        OF 1933. SUCH SECURITIES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
        SUCH
        REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT





(b)  Notice
      of Proposed Transfer: Opinions of Counsel .  Except
      as provided in paragraph (c) of this Section 8, prior to any transfer of any
      such shares of Series A Preferred Stock, the Holder thereof will give written
      notice to the Corporation of such Holder’s intention to effect such transfer and
      to comply in all other respects with this Section 8. Each such notice (A) shall
      describe the manner and circumstances of the proposed transfer in sufficient
      detail to enable counsel to render the opinions referred to below, and (B)
      shall
      designate counsel for the Holder giving such opinions (who may be house counsel
      for such Holder). The Holder giving such notice will submit a copy thereof
      to
      the counsel designated in such notice and the Corporation will promptly submit
      a
      copy thereof to its counsel. If in the opinion of each such counsel the proposed
      transfer of such shares of Series A Preferred Stock may be effected without
      registration under the Act, the Corporation will promptly notify the Holder
      thereof and such Holder shall thereupon be entitled to transfer such shares
      of
      Series A Preferred Stock in accordance with the terms of the notice delivered
      by
      such Holder to the Corporation. Each share of Series A Preferred Stock or
      certificate, if any, issued upon or in connection with such transfer shall
      bear
      the appropriate restrictive legend set forth in paragraph (a) of this Section
      8,
      unless in the opinion of each such counsel such legend is no longer required
      to
      insure compliance with the Act. If for any reason counsel for the Corporation
      (after having been furnished with the information required to be furnished
      by
      this paragraph (b)) shall fail to deliver an opinion of the Corporation, or
      the
      Corporation shall fail to notify such Holder thereof as aforesaid, within 20
      days after counsel for such Holder shall have delivered its opinion to such
      Holder (with a copy to the Corporation), then for all purposes of these
      Designations the opinion of counsel for the Corporation shall be deemed to
      be
      the same as the opinion of counsel for such Holder. If in the opinion of either
      or both of such counsel the proposed transfer of such shares of Series A
      Preferred Stock may not be effected without registration under the Act, the
      Corporation will promptly so notify the Holder thereof and thereafter such
      Holder shall not be entitled to transfer such share of Series A Preferred Stock
      until receipt of a further notice from the Corporation under this Section
      8(b).  Page
            10


(c)  Proposed
      Transfer to Institutions .  Notwithstanding
      the foregoing, any Holder of such share of Series A Preferred Stock shall be
      permitted to transfer any such share of Series A Preferred Stock to a limited
      number of Institutional Investors, provided that;





(i)
      Each
      such institution represents in writing that it is acquiring such shares of
      Series A Preferred Stock for investment and not with a view to the distribution
      thereof (subject, however, to any requirement of law that the disposition
      thereof shall at all times be within the control of such transferee);





(ii)
      Each
      such institution agrees in writing to be bound by all the restrictions on
      transfer of such shares of Series A Preferred Stock contained in this Section
      8;
      and





(iii)
      Such Holder delivers to the Corporation an opinion of counsel who shall be
      satisfactory to counsel for the Corporation, stating that such transfer may
      be
      effected without registration under the Act.





9.  Status
      of Acquired Shares .  Shares
      of Series A Preferred Stock redeemed by the Corporation pursuant to Section
      7,
      received upon conversion pursuant to Section 6, or otherwise acquired by the
      Corporation will be restored to the status of authorized but unissued shares
      of
      preferred stock, without designation as to class, and may thereafter be issued,
      but not as shares of Series A Preferred Stock.





10.  Preemptive
      Rights .  The
      Series A Preferred is not entitled to any preemptive or subscription rights
      in
      respect of any securities of the Corporation.





11.  Severability
      of Provisions .  Whenever
      possible, each provision hereof shall be interpreted in a manner as to be
      effective and valid under applicable law, but if any provision hereof is held
      to
      be prohibited by or invalid under applicable law, such provision shall be
      ineffective only the extent of such prohibition or invalidity, without
      invalidating or otherwise adversely affecting the remaining provisions hereof.
      If a court of competent jurisdiction should determine that a provision hereof
      would be valid or enforceable if a period of time were extended or shortened
      or
      a particular percentage were increased or decreased, then such court may make
      such change as shall be necessary to render the provision in question effective
      and valid under applicable law.  Page
            11