<PAGE>


                                                                    EXHIBIT 3(i)

                                                                FILED
                                                         in the Office of the
                                                     Secretary of State of Texas
                                                              AUG 14 2000
                                                         Corporations Section
                                 SECOND AMENDED

                                       AND

                       RESTATED ARTICLES OF INCORPORATION

                                       OF

                         RETRACTABLE TECHNOLOGIES, INC.

     Pursuant to the provisions of Article 4.07 of the Texas Business
Corporation Act, Retractable Technologies, Inc. (hereinafter called the
"Corporation") hereby adopts the following amendments and restates the Articles
of Incorporation of the Corporation as previously amended or supplemented and as
further amended by these Second Amended and Restated Articles of Incorporation
of the Corporation as follows:

                                    ARTICLE I
                                    ---------

     The name of the Corporation is Retractable Technologies, Inc.

                                   ARTICLE II
                                   ----------

     The following amendment to the Articles of Incorporation was adopted by the
Board of Directors of the Corporation on August 1, 2000, and by the shareholders
of the Corporation effective as of August 11, 2000, for the purpose of changing
the registered agent and office of the Corporation. The Amendment alters
Artictle VII of the Restated Articles of Incorporation filed on April 13, 2000,
and the full text of Article VII, as hereby amended, is as follows:

          The street address of its registered office is 2001 Bryan Tower, Ste.
          2700, Dallas, Texas 75201 and the name of its registered agent is
          Ralph S. Janvey.

                                   ARTICLE III
                                   -----------

     The following amendment to the Articles of Incorporation was adopted by the
Board of Directors of the Corporation on August 1, 2000, and by the shareholders
of the Corporation effective as of August 11, 2000, for the purpose of changing
the term of office of directors from three to two years in order to comply with
Section 2.33 of the Texas Business Corporation Act. The Amendment alters Section
(a) of Article X of the Restated Articles of Incorporation filed on April 13,
2000, and the full text of Section (a) of Article X, as hereby amended, is as
follows:

     a)   Number, Election, and Terms of Directors. The business and affairs of
          the Corporation shall be managed by



                                        1

<PAGE>


          a Board of Directors, which, subject to the rights of holders of
          shares of any class of series of Preferred Stock of the Corporation
          then outstanding to elect additional directors under specified
          circumstances, shall consist of not less than three nor more than
          twenty-one persons. The exact number of directors within the minimum
          and maximum limitations specified in the preceding sentence shall be
          fixed from time to time by either (i) the Board of Directors pursuant
          to a resolution adopted by the majority of the entire Board of
          Directors, or (ii) the affirmative vote of the holders of 66-2/3% or
          more of the voting power of all of the shares of the Corporation
          entitled to vote generally in the election of directors voting
          together as a single class. No decrease in the number of directors
          constituting the Board of Directors shall shorten the term of any
          incumbent director; provided, however, that the term of existing
          Directors may be shortened to comply with this Article X and/or the
          Texas Business Corporation Act. The directors shall be divided into
          two classes as nearly equal in number as possible, with the term of
          office of the first class to expire at the 2001 annual meeting of
          stockholders, and the term of office of the second class to expire at
          the 2002 annual meeting of stockholders, and with the members of each
          class to hold office until their successors shall have been elected
          and qualified. At each annual meeting of stockholders following such
          initial classification and election, directors elected to succeed
          those directors shall be elected for a term of office to expire at the
          second succeeding annual meeting of stockholders after their election.

                                   ARTICLE IV
                                   ----------

     The following amendment to the Articles of Incorporation was adopted by the
Board of Directors of the Corporation on August 1, 2000 and by the shareholders
of the Corporation effective as of August 11, 2000, for the purpose of changing
the number of days of advance notice of stockholder nominations of directors
from 60 days to at least 5 days prior to the scheduled date for the next annual
meeting of stockholders. The Amendment alters Section (b) of Article X of the
Restated Articles of Incorporation filed on April 13, 2000, and the full text of
Section (b) of Article X, as hereby amended, is as follows:

     b)   Stockholder Nomination of Director Candidates. Advance notice of
          stockholder nominations for the election of directors shall be
          submitted to the Board of Directors at least five days prior to the
          scheduled date for the next annual meeting of stockholders.

                                        2

<PAGE>

                                    ARTICLE V
                                    ---------

     Each amendment made by these Restated Articles of Incorporation, which
amendments are set forth in Articles II through IV above, has been effected in
conformity with the provisions of the Texas Business Corporation Act.


                                   ARTICLE VI
                                   ----------

     This Restatement of the Articles of Incorporation of the Corporation
accurately copies the Articles of Incorporation and all amendments thereto that
are in effect to date and as further amended by these Restated Articles of
Incorporation of the Corporation and there are no other changes in any provision
thereof except that the number of directors now constituting the Board of
Directors and the names and addresses of the persons now serving as directors
have been inserted in lieu of similar information concerning the initial Board
of Directors and the names and addresses of each incorporator has been omitted
pursuant to Article 4.07 of the Texas Business Corporation Act. These restated
Articles of Incorporation and the amendments contained herein supersede the
original Articles of Incorporation and all amendments thereto.

                                   ARTICLE VII
                                   -----------

     The Articles of Incorporation of the Corporation as amended and
supplemented by all certificates of amendment previously issued by the Secretary
of State and as further amended by these Restated Articles of Incorporation of
the Corporation is hereby restated in its entirety as follows:

                            ARTICLES OF INCORPORATION

                                       OF

                         RETRACTABLE TECHNOLOGIES, INC.

     I, the undersigned natural person of the age of eighteen (18) years or
more, acting as an Incorporator of a corporation under the Texas Business
Corporation Act, do hereby adopt the following Articles of Incorporation for
such Corporation:

                                        3

<PAGE>

                                    ARTICLE I

     The name of the Corporation is Retractable Technologies, Inc.

                                   ARTICLE II

     The period of its duration is perpetual.

                                   ARTICLE III

     The purpose for which the Corporation is organized is the transaction of
any or all lawful business for which corporations may be incorporated under the
Texas Business Corporation Act.

                                   ARTICLE IV

     4.01  The aggregate number of shares which the Corporation shall have the
           authority to issue is 100,000,000 shares of Common Stock, no par
           value, 5,000,000 shares of Preferred Stock Class A with a par value
           of One Dollar ($1.00) per share and 5,000,000 shares of Preferred
           Stock Class B with a par value of One Dollar ($1.00) per share.

     4.02  The Corporation is authorized to issue three classes of stock, one
           designated as Common Stock, no par value, one designated as Preferred
           Stock Class A, par value One Dollar ($1.00) per share, and one
           designated as Preferred Stock Class B, par value One Dollar ($1.00)
           per share, each as described in this Article IV above. Provided,
           however, that none of the shares of Preferred Stock of either class
           shall carry any voting rights for the election of Directors or for
           any other matters, except where specifically designated or required
           by the applicable provisions of the Texas Business Corporation Act.

     4.03  The Directors shall have the authority to divide each class of the
           Preferred Stock into series and to set the relative rights and
           preferences as to and between series, including dividends, issuance
           of Preferred Stock, redemption of such shares and the conversion of
           any shares of Preferred Stock to other or common shares. Prior to the
           issuance of any Preferred Stock of a series established by resolution
           adopted by the Directors, the Corporation shall file with the
           Secretary of State the notice required by Article 2.13 of the Texas
           Business Corporation Act.

     4.04  The relative rights and preferences of the shares of Preferred Stock
           Class A are set forth in the Certificate of Designation, Preferences,
           Rights, and Limitations of Series A Convertible Preferred Stock of
           the Corporation filed on October 13, 1995, which certificate is
           attached hereto and incorporated herein for all purposes as Exhibit
           A.

                                        4

<PAGE>

     4.05  The relative rights and preferences of the shares of the Series I
           Preferred Stock Class B are set forth in the Certificate of
           Designation, Preferences, Rights, and Limitations of Class B
           Convertible Preferred Stock of the Corporation filed on May 11, 1996,
           which certificate is attached hereto and incorporated herein for all
           purposes as Exhibit B.

     4.06  The relative rights and preferences of the shares of the Series II
           Preferred Stock Class B are set forth in the Certificate of
           Designation, Preferences, Rights, and Limitations of Series II Class
           B Convertible Preferred Stock of the Corporation filed on May 27,
           1997, which certificate is attached hereto and incorporated herein
           for all purposes as Exhibit C.

     4.07  The relative rights and preferences of the shares of the Series III
           Preferred Stock Class B are set forth in the Certificate of
           Designation, Preferences, Rights, and Limitations of Series III Class
           B Convertible Preferred Stock of the Corporation filed on July 29,
           1998, which certificate is attached hereto and incorporated herein
           for all purposes as Exhibit D.

     4.08  The relative rights and preferences of the shares of the Series IV
           Preferred Stock Class B are set forth in the Certificate of
           Designation, Preferences, Rights, and Limitations of Series IV Class
           B Convertible Preferred Stock of the Corporation filed on January 24,
           2000, which certificate is attached hereto and incorporated herein
           for all purposes as Exhibit E.

                                    ARTICLE V

     The Corporation will not commence business until it has received, for the
issuance of its shares, consideration of the value of One Thousand Dollars
($1,000.00), consisting of money, labor done, or property actually received. The
manner in which any exchange, reclassification, cancellation of issued shares is
as follows: The present holder of 1,000 shares of no par value common stock may
exchange such shares for 14,000,000 shares of no par value Common Stock.

                                   ARTICLE VI

     Cumulative voting is expressly prohibited.

                                        5

<PAGE>

                                   ARTICLE VII

     The street address of its registered office is 2001 Bryan Tower, Ste. 2700,
Dallas, Texas 75201 and the name of its registered agent is Ralph S. Janvey.

                                  ARTICLE VIII

     The Directors of the Corporation shall be not less than three (3) nor more
than twenty-one (21) in number and the name and address of the directors who are
to serve until the annual meeting of year indicated or until their successors
are elected and qualified or until their term is terminated are as follows:

     Director                        Address                    Term expires
     ------------------------------  -------------------------  ------------
     Thomas J. Shaw                  511 Lobo Lane                      2000
                                     PO Box 9
                                     Little Elm, TX 75068-0009

     Steve Wisner                    511 Lobo Lane                      2000
                                     PO Box 9
                                     Little Elm, TX 75068-0009

     Lillian E. Salerno              511 Lobo Lane                      2000
                                     PO Box 9
                                     Little Elm, TX 75068-0009

     Douglas W. Cowan                511 Lobo Lane                      2000
                                     PO Box 9
                                     Little Elm, TX 75068-0009

     Clarence Zierhut                511 Lobo Lane                      2002
                                     PO Box 9
                                     Little Elm, TX 75068-0009

     Marwan Saker                    511 Lobo Lane                      2000
                                     PO Box 9
                                     Little Elm, TX 75068-0009

     Dr. Jimmie Shiu                 511 Lobo Lane                      2000
                                     PO Box 9
                                     Little Elm, TX 75068-0009

     Edith Zagona                    511 Lobo Lane                      2000
                                     PO Box 9
                                     Little Elm, TX 75068-0009

     Russell B. Kuhlman              511 Lobo Lane                      2000
                                     PO Box 9
                                     Little Elm, TX 75068-0009

                                        6

<PAGE>

                                   ARTICLE IX

     The name and address of the incorporator is intentionally omitted.

                                    ARTICLE X

     Corporate Governance

     a)   Number, Election, and Terms of Directors. The business and affairs of
          the Corporation shall be managed by a Board of Directors, which,
          subject to the rights of holders of shares of any class of series of
          Preferred Stock of the Corporation then outstanding to elect
          additional directors under specified circumstances, shall consist of
          not less than three nor more than twenty-one persons. The exact number
          of directors within the minimum and maximum limitations specified in
          the preceding sentence shall be fixed from time to time by either (i)
          the Board of Directors pursuant to a resolution adopted by the
          majority of the entire Board of Directors, or (ii) the affirmative
          vote of the holders of 66-2/3% or more of the voting power of all of
          the shares of the Corporation entitled to vote generally in the
          election of directors voting together as a single class. No decrease
          in the number of directors constituting the Board of Directors shall
          shorten the term of any incumbent director; provided, however, that
          the term of existing Directors may be shortened to comply with this
          Article X and/or the Texas Business Corporation Act. The directors
          shall be divided into two classes as nearly equal in number as
          possible, with the term of office of the first class to expire at the
          2001 annual meeting of stockholders, and the term of office of the
          second class to expire at the 2002 annual meeting of stockholders, and
          with the members of each class to hold office until their successors
          shall have been elected and qualified. At each annual meeting of
          stockholders following such initial classification and election,
          directors elected to succeed those directors shall be elected for a
          term of office to expire at the second succeeding annual meeting of
          stockholders after their election.

     b)   Stockholder Nomination of Director Candidates. Advance notice of
          stockholder nominations for the election of directors shall be
          submitted to the Board of Directors at least five days prior to the
          scheduled date for the next annual meeting of stockholders.

     c)   Newly Created Directorships and Vacancies. Vacancies of generally
          elected directors may be filled by a majority vote of the remaining
          generally elected directors, though less than a quorum,

                                        7

<PAGE>

          or by a sole remaining generally elected director. Vacancies of
          directors elected pursuant to a dividend default election by preferred
          shareholders shall be filled by the remaining directors so elected or
          by a sole remaining director elected by such shareholders, if any. In
          the event that no directors elected pursuant to a dividend default
          election remain, the vacancy may be filled by a vote of those
          shareholders that originally elected the director whose office is
          vacant.

     d)   Removal. Any director, or the entire Board of Directors, may be
          removed from office at any annual or special meeting called for such
          purpose, and then only for cause and only by the affirmative vote of
          the holders of 66-2/3% or more of the voting power of all of the
          shares of the Corporation entitled to vote in the election of such
          director(s) being removed. As used herein, cause shall mean only the
          following: proof that a director has been convicted of a felony,
          committed a grossly negligent or willful misconduct resulting in a
          material detriment to the Corporation, or committed a material breach
          of his or her fiduciary duty to the Corporation resulting in a
          material detriment to the Corporation.

     e)   Amendment, Repeal, etc. Notwithstanding anything contained in these
          Articles of Incorporation to the contrary and subject to the rights of
          the holders of any Preferred Stock outstanding, the affirmative vote
          of the holders of 66-2/3% or more of the voting power of all of the
          shares of the Corporation entitled to vote in the election of
          Directors, voting together as a single class, shall be required to
          alter, amend, or adopt any provision inconsistent with or repeal this
          Article X or to alter, amend, adopt any provision inconsistent with or
          repeal comparable sections of the Amended and Restated Bylaws of the
          Corporation.

     f)   Call of Special Meeting to Alter Article X. Notwithstanding anything
          contained in these Articles of Incorporation to the contrary, the
          affirmative vote of the holders of 66-2/3% or more of the voting power
          of all of the shares of the Corporation entitled to vote generally in
          the election of directors, voting together as a single class, shall be
          required to call a special meeting of the shareholders in order to
          alter, amend, adopt any provision inconsistent with or repeal this
          Article X, or to alter, amend, or adopt any provision inconsistent
          with comparable sections of the Amended and Restated Bylaws.

                                        8

<PAGE>

                                   ARTICLE XI

     The Board of Directors is hereby authorized to create and issue, whether or
not in connection with the issuance and sale of any of its stock or other
securities, rights (the "Rights") entitling the holders thereof to purchase from
the Corporation shares of capital stock or other securities. The times at which
and the terms upon which the Rights are to be issued will be determined by the
Board of Directors and set forth in the contracts or instruments that evidence
the Rights. The authority of the Board of Directors with respect to the Rights
shall include, but not be limited to, determination of the following:

     a)   The initial purchase price per share of the capital stock or other
          securities of the Corporation to be purchased upon exercise of the
          Rights.

     b)   Provisions relating to the times at which and the circumstances under
          which the Rights may be exercised or sold or otherwise transferred,
          either together with or separately from, any other securities of the
          Corporation.

     c)   Provisions that adjust the number or exercise price of the Rights or
          amount or nature of the securities or other property receivable upon
          exercise of the Rights in the event of a combination, split, or
          recapitalization of any capital stock of the Corporation, a change in
          ownership of the Corporation's securities, or a reorganization,
          merger, consolidation, sale of assets, or other occurrence relating to
          the Corporation or any capital stock of the Corporation, and
          provisions restricting the ability of the Corporation to enter into
          any such transaction absent an assumption by the other party or
          parties thereto of the obligations of the Corporation under such
          Rights.

     d)   Provisions that deny the holder of a specified percentage of the
          outstanding securities of the Corporation the right to exercise the
          Rights and/or cause the Rights held by such holder to become void.

     e)   Provisions that permit the Corporation to redeem the Rights.

     f)   The appointment of a Rights agent with respect to the Rights.

                                        9

<PAGE>

                                   ARTICLE XII
                                   -----------

     No holder of any shares of the Corporation shall have any preemptive right
to subscribe or acquire any additional, unissued or treasury shares of the
Corporation or any securities of the Corporation which are convertible into or
which carry a right to subscribe for or acquire shares of the Corporation.

                                  ARTICLE VIII
                                  ------------

     The number of shares of the Corporation that were issued and outstanding
and entitled to vote at the time of the adoption of the amendments was Fourteen
Million (14,000,000) shares of Common Stock having no par value per share.
Fourteen Million shares were voted in favor of the Restated Articles of
Incorporation as amended and no shares were voted against the Restated Articles
of Incorporation as amended.

     IN WITNESS WHEREOF, Thomas J. Shaw, the President of the Corporation, has
executed these Restated Articles of Incorporation of Retractable Technologies,
Inc. effective as of the 11th day of August, 2000.

                                         RETRACTABLE TECHNOLOGIES, INC.


                                         BY: /s/ Thomas J. Shaw
                                             ----------------------------
                                             THOMAS J. SHAW
                                             PRESIDENT

<PAGE>

                                                                       EXHIBIT A

                                                                FILED
                                                         In the Office of the
                                                     Secretary of State of Texas
                                                             OCT 13 1995
                                                         Corporations Section

                     CERTIFICATE OF DESIGNATION, PREFERENCES
                       RIGHTS AND LIMITATIONS OF SERIES A
                           CONVERTIBLE PREFERRED STOCK
                                       OF
                         RETRACTABLE TECHNOLOGIES, INC.

     Pursuant to Article 2.13 of the Texas Business Corporation Act and Article
Five of its Articles of Incorporation, Retractable Technologies, Inc., a
corporation organized and existing under the laws of the State of Texas (the
Corporation),

     DOES HEREBY CERTIFY that pursuant to the authority conferred upon the Board
of Directors of the Corporation by the Articles of Incorporation, as amended,
and pursuant to Article 2.13 of the Texas Business Corporation Act, said Board
of Directors, by unanimous written consent executed May 10, 1995, adopted a
resolution providing for the creation of a series of Preferred Stock consisting
of not more than five million (5,000,000) shares of Class A Convertible
Preferred Stock, which resolution is and reads as follows:

     RESOLVED that, pursuant to the authority provided in the Corporation's
Articles of Incorporation and expressly granted to and vested in the Board of
Directors of Retractable Technologies, Inc. (the "Corporation"), the Board of
Directors hereby creates out of the Class A Preferred Stock, par value one
dollar per share, of the Corporation a series of Series A Preferred Stock
consisting of not more than five million (5,000,000) shares, and the Board of
Directors hereby fixes the designation and the powers, preference and rights,
and the qualifications, limitations and restrictions thereof, to the extent not
otherwise provided in the Corporation's qualifications, limitations and
restrictions thereof, to the extent not otherwise provided in the Corporation's
Articles of Incorporation, as follows:

     1. Designation of series. The designation of the series of Class A
        ---------------------
Preferred Stock created by this resolution shall be "Series A Convertible
Preferred Stock" (the "Series A Preferred Stock").

     2. Dividends on Series A Preferred Stock.
        -------------------------------------

        a. Dividend Amount. The holders of the Series A Preferred Stock
           ---------------
shall be entitled to receive, in any calendar year, if when and as declared by
the Board of Directors, out of any assets at the time legally available therefor
and subject to the further limitations set out herein, dividends at the per
annum rate of $0.12 per share, all such dividends due quarterly in arrears as of
the last day of each March, June, September and December of each year, the first
dividend being declarable on September 1, 1995. On each

<PAGE>

date which a dividend may be declared is hereafter called the "Dividend Date,"
and each quarterly period ending with a Dividend Date is hereinafter referred to
as the "Dividend Period." Dividends shall be payable fifteen calendar days after
the Dividend Due Date, provided however, that if such date on which a dividend
is payable is a Saturday, Sunday or legal holiday, such dividend shall be
payable on the next following business day to the holders of record (whether
singular or plural, the "Holder").

          b. Dividends Cumulative. Dividends upon the Series A Preferred
             --------------------
Stock shall be accrued and be cumulative, whether or not in any Dividend Period
or Periods there shall be funds of the Corporation legally available for the
payment of such dividends.

          c. Dividend Accrual. On each Dividend Due Date all dividends which
             ----------------
shall have accrued since the last Dividend Due Date on each share of Series A
Preferred Stock outstanding on such Dividend Due Date shall accumulate and be
deemed to become "due." Any dividend which shall not be paid on the Dividend Due
Date on which it shall become due shall be deemed to be "past due" until such
dividend shall be paid or until the share of Series A Preferred Stock with
respect to which such dividend became due shall no longer be outstanding,
whichever is the earlier to occur. No interest, sum of money in lieu of interest
or other property or securities shall be payable in respect of any dividend
payment or payments which are past due. Dividends paid on shares of Series A
Preferred Stock in an amount less that the total amount of such dividends at the
time accumulated and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding. Dividend
payments made with respect to a Dividend Due Date shall be deemed to be made in
payment of the dividends which became due on that Dividend Due Date.

          d. Dividend Arrearage. If a dividend upon any shares of Series
             ------------------
A Preferred Stock is in arrears, all dividends or other distributions declared
upon shares of the Series A Preferred Stock (other than dividends paid in stock
of the Corporation ranking junior to the Series A Preferred Stock as to
dividends and upon liquidation, dissolution or winding up) may only be declared
pro rata. Except as set forth above, if a dividend upon any shares of Series A
Preferred Stock is in arrears: (i) no dividends (in cash, stock or other
property) may be paid or declared and set aside for payment or any other
distribution made upon any stock of the Corporation ranking junior to the Series
A Preferred Stock as to dividends (other than dividends of distributions in
stock of the Corporation ranking junior to the Series A Preferred Stock as to
dividends and upon liquidation, dissolution or winding up); and (ii) no stock of
the Corporation ranking junior to the Series A Preferred Stock as to dividends
may be (A) redeemed pursuant to a sinking fund of otherwise, except (1) by means
of redemption pursuant to which all outstanding shares of the Series A Preferred
Stock are redeemed, or (2) by conversion of any such junior stock into, or
exchange of any such junior stock into, or exchange of any such junior stock for
stock of the Corporation ranking junior to the Series A Preferred Stock as to
dividends and upon liquidation, dissolution or winding

                                        2

<PAGE>

up, or (B) purchased or otherwise acquired for any consideration by the
Corporation except (1) pursuant to an acquisition made pursuant to the terms of
one or more offers to purchase all of the outstanding shares of the Series A
Preferred Stock, which offers shall each have been accepted by the holders of at
least 50% of the shares of the Series A Preferred Stock receiving such offer
outstanding at the commencement of the first of such purchase offers, or (2) by
conversion into or exchange for stock of the Corporation ranking junior to the
Series A Preferred Stock as to dividends and upon liquidation, dissolution or
winding up.

     3. General, Class and Series Voting Rights. Except as provided in this
        ---------------------------------------
Section 3 and in Section 4 hereof or as otherwise from time to time required by
law, the Series A Preferred Stock shall have no voting rights.

     So long as any shares of Series A Preferred Stock remain outstanding, the
consent of the holders of at least fifty-one (51%) percent of the shares of
Series A Preferred Stock outstanding at the time voting separately as a class,
given in person or by proxy, either in writing at any special or annual meeting
called for the purpose, shall be necessary to permit, effect or validate any one
or more of the following:

          (i)  The authorization, creation or issuance, or any increase in the
     authorized or issued amount, of any class or series of stock (including any
     class or series of Preferred Stock) ranking equal or prior (as the terms
     are hereinafter defined in this Section 3) to the Series A Preferred Stock;
     or

          (ii) The amendment, alteration or repeal, whether by merger,
     consolidation or otherwise, of any of the provisions of the Articles of
     Incorporation or of this resolution which would alter or change the powers,
     preferences or special rights of the shares of the Series A Preferred Stock
     so as to affect them adversely; provided, however, that any increase in the
     amount of authorized Preferred Stock, or the creation and issuance of other
     series of Preferred Stock ranking junior to the Series A Preferred Stock
     with respect to the payment of dividends and the distribution of assets
     upon liquidation, dissolution or winding up, shall not be deemed to
     adversely affect such powers, preferences or special rights.

     The foregoing voting provisions shall not apply if, at or prior to the time
when the act with respect to which such vote would otherwise be required shall
be effected, all outstanding shares of Series A Preferred Stock shall have been
redeemed or sufficient funds shall have been deposited in trust to effect such
redemption.

     4. Default Voting Rights. Whenever, at any time or times, dividends
        ---------------------
payable on the shares of Series A Preferred Stock shall be in arrears for twelve
(12) consecutive quarterly dividend periods, the holders of a majority of the
outstanding shares of Series A

                                        3

<PAGE>

Preferred Stock shall have the exclusive right (voting separately as a class) to
elect one-third of the Board of Directors of the Corporation at the
Corporation's next annual meeting of stockholders (to serve until the next
annual meeting of stockholders, and until their successors are duly elected and
qualified) and at each subsequent annual meeting of stockholders so long as such
arrearage shall continue, and the Common Stock voting separately as a class,
shall be entitled to elect the remainder of the Board of Directors of the
Corporation. At elections for such directors, each holder of Series A Preferred
Stock shall be entitled to one vote for each share of Preferred Stock held. The
right of the holders of Series A Preferred Stock, voting separately as a class,
to elect members of the Board of Directors of the Corporation as aforesaid shall
continue until such time as all dividends accumulated on the Series A Preferred
Stock shall have been paid in full, at which time such right shall terminate,
except as herein or by law expressly provided, subject to revesting in the event
of each and every subsequent default of the character above mentioned.

     Directors elected by the holders of Series A Preferred Stock shall continue
to serve as such directors until such time as all dividends accumulated on the
Series A Preferred Stock shall have been paid in full, at which time the term of
office of all persons elected as directors by the holders of shares of Series A
Preferred Stock shall forthwith terminate. In the case of any vacancy in the
office of a director occurring among the directors elected by the holder of a
class (with the Series A Preferred Stock and Common Stock being treated as
separate classes) of stock, the remaining directors so elected by that class may
by affirmative vote of a majority thereof (or the remaining director so elected
if there be but one) elect a successor or successors to hold office for the
unexpired term of the director or directors whose place or places shall be
vacant. Any director who shall have been elected by the holders of a class of
stock or by any directors so elected as provided in the next preceding sentence
hereof may be removed during the aforesaid term of office, either for or without
cause, by, and only by, the affirmative vote of the holders of a majority of the
shares of the class of stock who elected such director or directors, given
either at a special meeting of such shareholders duly called for that purpose or
pursuant to a written consent of shareholders, and any vacancy thereby created
may be filled by the holders of that class of stock represented at such meeting
or pursuant to such written consent. Whenever the term of office of the
directors elected by the holders of Series A Preferred Stock voting as a class
shall end and the special voting powers vested in the holders of Series A
Preferred Stock voting as a class shall end and the special voting powers vested
in the holders of Series A Preferred Stock as provided in this Section 4 shall
have expired, the number of directors shall be such number as may be provided
for in the Articles of Incorporation or Bylaws irrespective of any increase made
pursuant to the provisions of this Section 4.

     5. Redemption. The outstanding shares of Series A Preferred Stock shall
        ----------
be nonredeemable prior to the lapse of three (3) years from the date of
issuance. On and after such date, the Series A Preferred Stock may be redeemed
at the option of the Corporation, as a whole at any time or in part from time to
time, at the Redemption Price of $1.70 per share plus all dividends (whether or
not declared or due) accrued and unpaid to the date of redemption (subject to
the right of the holder of record of shares of Series A Preferred Stock

                                        4

<PAGE>

on a record date for the payment of a dividend on the Series A Preferred Stock
to receive the dividend due on such shares of Series A Preferred Stock on the
corresponding Dividend Due Date.)

     No sinking fund shall be established for the Series A Preferred Stock.

     Notice of any proposed redemption of shares of Series A Preferred Stock
shall be mailed by means of first class mail, postage paid, addressed to the
holders of record of the shares of Series A Preferred Stock to be redeemed, at
their respective addresses then appearing on the books of the Corporation, at
least thirty (30) but not more than sixty (60) days prior to the date fixed for
such redemption (herein referred to as the "Redemption Date"). Each such notice
shall specify (i) the Redemption Date; (ii) the Redemption Price; (iii) the
place for payment and for delivering the stock certificate(s) and transfer
instrument(s) in order to collect the Redemption Price; (iv) the shares of
Series A Preferred Stock to be redeemed; and (v) the then effective Conversion
Price (as defined below) and that the right of holders of shares of Series A
Preferred Stock being redeemed to exercise their conversion right shall
terminate as to such shares at the close of business on the fifth day before the
Redemption Date (provided that no default by the Corporation in the payment of
the applicable Redemption Price (including any accrued and unpaid dividends)
shall have occurred and be continuing). Any notice mailed in such manner shall
be conclusively deemed to have been duly given whether or not such notice is in
fact received. If less than all the outstanding shares of Series A Preferred
Stock are to be redeemed, the Corporation will select those to be redeemed by
lot or by a substantially equivalent method. In order to facilitate the
redemption of Series A Preferred Stock to be redeemed, which shall not be more
than sixty (60) days prior to the Redemption Date with respect thereto.

     The holder of any shares of Series A Preferred Stock redeemed upon any
exercise of the Corporation's redemption right shall not be entitled to receive
payment of the Redemption Price for such shares until such holder shall cause to
be delivered to the place specified in the notice given with respect to such
redemption (i) the certificate(s) representing such shares of Series A Preferred
Stock; and (ii) transfer instrument(s) satisfactory to the Corporation and
sufficient to transfer such shares of Series A Preferred Stock to the
Corporation free of any adverse interest. No interest shall accrue on the
Redemption Price of any share of Series A Preferred Stock after its Redemption
Date.

     Subject to Section 2 hereof, the Corporation shall have the right to
purchase shares of Series A Preferred Stock from the owner of such shares on
such terms as may be agreeable to such owner. Shares of Series A Preferred Stock
may be acquired by the Corporation from any stockholder pursuant to this
paragraph without offering any other stockholder an equal opportunity to sell
his stock to the Corporation, and no purchase by the Corporation from any
stockholder pursuant to this paragraph shall be deemed to create any right on
the part of any stockholder to sell any shares of Series A Preferred Stock (or
any other stock) to the Corporation.

                                        5

<PAGE>

     Notwithstanding the foregoing provisions of this Section 5, and subject to
the provisions of Section 2 hereof, if a dividend upon any shares of Series A
Preferred Stock is past due, (i) no shares of the Series A Preferred Stock may
be redeemed, except (A) by means of a redemption pursuant to which all
outstanding shares of the Series A Preferred Stock are simultaneously redeemed
(or offered to be so redeemed) or pursuant to which the outstanding shares of
the Series A Preferred Stock are redeemed on a pro rata basis (or offered to be
so redeemed), or (B) by conversion of shares of Series A Preferred Stock into,
or exchange of such shares for, Common Stock or any other stock of the
Corporation ranking junior to the Series A Preferred Stock as to dividends and
upon liquidation, dissolution or winding up.

     6. Liquidation. In the event of any voluntary or involuntary dissolution,
        -----------
liquidation or winding up of the Corporation (for the purposes of this Section
6, a "Liquidation"), before any distribution of assets shall be made to the
holders of the Common Stock or the holders of any other stock that ranks junior
to the Series A Preferred Stock in respect of distributions upon the Liquidation
of the Corporation, the holder of each share of Series A Preferred Stock then
outstanding shall be entitled to $1.50 per share plus all dividends (whether or
not declared or due) accrued and unpaid on such share on the date fixed for the
distribution of assets of the Corporation to the holders of Series A Preferred
Stock.

     If upon any Liquidation of the Corporation, the assets available for
distribution to the holder of Series A Preferred Stock which shall then be
outstanding (hereinafter in this paragraph called the "Total Amount Available")
shall be insufficient to pay the holders of all outstanding shares of Series A
Preferred Stock the full amounts (including all dividends accrued and unpaid) to
which they shall be entitled by reason of such Liquidation of the Corporation,
then there shall be paid ratably to the holders of the Series A Preferred Stock
in connection with such Liquidation of the Corporation, an amount equal to each
holder's pro rata share of the Total Amount Available.

     The voluntary sale, conveyance, lease, exchange or transfer of all or
substantially all the property or assets of the Corporation, or the merger or
consolidation of the Corporation into the Corporation, or any purchase or
redemption of some or all of the shares of any class or series of stock of the
Corporation, shall not be deemed to be a Liquidation of the Corporation for the
purposes of this Section 6 (unless in connection therewith the Liquidation of
the Corporation is specifically approved).

     7. Conversion Privilege. At any time subsequent to three years after
        --------------------
issuance of any share of Series A Preferred Stock, the holder of any share of
Series A Preferred Stock ("Holder") shall have the right, at such Holder's
option (but if such share is called for redemption or exchange at the election
of the Corporation, then in respect of such share only to and including but not
after the close of business on (i) the fifth calendar day before the

                                        6

<PAGE>

date fixed for such redemption; or (ii) the date fixed for such exchange,
provided that the Corporation has set aside funds sufficient to effect such
redemption to convert such share into that number of fully paid and non-
assessable shares of Common Stock (calculated as to each conversion to the
nearest 1/100th of a share) obtained by dividing $1.00 by the Conversion Rate
then in effect.

          a. Conversion Rate. Each share of Series A Preferred Stock may be
             ---------------
converted, subject to the terms and provisions of this paragraph 2 into one (1)
share of the Corporation's Common Stock, which is a price equal to one share of
Common Stock for each $1.00 of Series A Preferred Stock or, in case an
adjustment of such rate has taken place pursuant to the provisions of
subdivision (f.) of this paragraph (7), then at the Conversion Rate as last
adjusted (such rate or adjusted rate, shall be expressed as the number of shares
of Common Stock to be acquired upon conversion of one share of Series A
Preferred Stock, and shall be referred to herein as the "Conversion Rate"). Each
share of Series A Preferred Stock shall be Convertible into Common Stock by
surrender to the corporation of the certificate representing such shares of
Series A Preferred Stock to be converted by the Holder and by giving written
notice to the Corporation of the Holder's election to convert.

     The Corporation shall, as soon as practicable after receipt of such written
notice and the proper surrender to the Corporation of the certificate or
certificates representing shares of Series A Preferred Stock to be converted in
accordance with the above provisions, issue and deliver for the benefit of the
Holder at the office of the Corporation's duly appointed transfer agent (the
"Transfer Agent") to the Holder for whose account such shares of Series A
Preferred Stock were so surrendered or to such Holder's nominee or nominees,
certificates for the number of shares of Common Stock to which the Holder shall
be entitled. The certificates of Common Stock of the Corporation issued upon
conversion shall bear such legends as may be required by state or federal laws.
Such conversion shall be deemed to have been effective immediately prior to the
close of business on the date on which the Corporation shall have received both
such written notice and the properly surrendered certificates for shares of
Series A Preferred Stock to be converted (the "Conversion Date"), and at such
time the rights of the Holder shall cease and the person or persons entitled to
receive the shares of Common Stock issuable upon the conversion of such shares
of Series A Preferred Stock shall be deemed to be, and shall be treated for all
purposes as, the record Holder or Holders of such Common Stock on the Conversion
Date. The Corporation shall not be required to convert, and no surrender of
shares of Series A Preferred Stock or written notice of conversion with respect
thereto shall be effected for that purpose, while the stock transfer books of
the Corporation are closed for any reasonable business purpose for any
reasonable period of time, but the proper surrender of shares of Series A
Preferred Stock for conversion immediately upon the reopening of such books.
During the period in which the stock transfer books of the Corporation are
closed, the Corporation may neither declare a dividend, declare a record date
for payment of dividends nor make any payment of dividends.

                                        7

<PAGE>

          b. Dividends. If any shares of Series A Preferred Stock shall be
             ---------
converted during any dividend payment period, the Holder shall be entitled to
all dividends accrued up to and through such Conversion Date, at the rate set
forth herein, whether or not there has been a dividend date, as set forth in
paragraph 2 hereof.

          c. Cancellation. Series A Preferred Stock converted into Common
             ------------
Stock pursuant to the provisions of this paragraph (7), shall be retired and
cancelled by the Corporation and given the status of authorized and unissued
preferred stock.

          d. Reissuance if Conversion is Partial. In the case of any
             ------------------------------------
certificate representing shares of Series A Preferred Stock which is surrendered
for conversion only in part, the Corporation shall issue and deliver to the
Holder a new certificate or certificates for Series A Preferred Stock of such
denominations as requested by the Holder in the amount of Series A Preferred
Stock equal to the unconverted shares of the Series A Preferred Stock
represented by the certificate so surrendered.

          e. Reservations of Shares. The Corporation shall at all times
             ----------------------
during which shares of Series A Preferred Stock may be converted into Common
Stock as provided in this paragraph (e), reserve and keep available, out of any
Common Stock held as treasury stock or out of its authorized and unissued Common
Stock, or both, solely for the purpose of delivery upon conversion of the shares
of Series A Preferred Stock as herein provided, such number of shares of Common
Stock as shall then be sufficient to effect the conversion of all shares of
Series A Preferred Stock from time to time outstanding, and shall take such
action as may from time to time be necessary to ensure that such shares of
Common Stock will, when issued upon conversion of Series A Preferred Stock, be
fully paid and nonassessable.

          f. Adjustment of Conversion Rate. The Conversion Rate provided in
             -----------------------------
subdivision (a) of this paragraph (7), in respect of Series A Preferred Stock,
shall be subject to adjustments from time to time as follows:

     (i) While any shares of Series A Preferred Stock shall be outstanding, in
   case the Corporation shall subdivide the outstanding shares of Common Stock
   into a greater number of shares of Common Stock or combine the outstanding
   shares of Common Stock into a smaller number of shares of Common Stock, or
   issue, by reclassification of its shares of Common Stock, any shares of the
   Corporation, the Conversion Rate in effect immediately prior thereto shall be
   adjusted so that the Holder shall be entitled to receive the number of shares
   which it would have owned or been entitled to receive after the happening of
   any of the events described above, had such shares of Series A Preferred
   Stock been converted immediately prior to the happening of such event, such
   adjustment to become effective immediately after the opening of business on
   the day following the day upon which such subdivision or combination or
   reclassification, as the case may be, becomes effective.

                                        8

<PAGE>

     (ii) In case the Corporation shall be consolidated with, or merge into, any
   other corporation, and the Corporation does not survive, proper provisions
   shall be made as a part of the terms of such consolidation or merger, whereby
   the Holder shall thereafter be entitled, upon exercise of such Holder's
   conversion rights, to receive the kind and amount of shares of stock or other
   securities of the Corporation resulting from such consolidation or merger, or
   such other property, as the Holder would have received if such conversion
   rights were exercised immediately prior to the effectiveness of such merger
   of consolidation.

     (iii) In the event the Corporation at any time, or from time to time after
   June 15, 1995 makes or issues, or fixes a record date for the determination
   of holders of Common Stock entitled to receive, a dividend or other
   distribution payable in additional shares of Common Stock or Common Stock
   Equivalents (as defined herein) which does not provide for the payment of any
   consideration upon the issuance, conversion or exercise thereof, without a
   corresponding dividend or other distribution to the Holder, based upon the
   number of shares of Common Stock into which the Series A Preferred Stock is
   convertible, then and in each such event the Conversion Rate then in effect
   will be increased as of the time of such issuance or, in the event such a
   record date shall have been fixed, as of the close of business on such record
   date, by multiplying such Conversion Rate by a fraction:

                (A) The number of which will be the total number of shares of
           Common Stock issues and outstanding immediately prior to the time of
           such issuance or the close of business on such record date plus the
           number of shares of Common Stock issuable in payment of such dividend
           or distribution (which, in the case of Common Stock Equivalents,
           shall mean the maximum number of shares of Common Stock issuable with
           respect thereto, as set forth in the instrument relative thereto
           without regard to any provision for subsequent adjustment); and

                (B) The denominator of which will be the total number of shares
           of Common Stock issued and outstanding immediately prior to the time
           of such issuance or the close of business on such record date;

   provided, however, that if such record date is fixed and such dividend is not
   fully paid or if such distribution is not fully made on the date fixed
   therefor, the Conversion Rate will be recomputed accordingly as of the close
   of business on such record date, and thereafter such Conversion Rate will be
   adjusted pursuant to this subparagraph (iii) as of the time of actual payment
   of such dividends of distributions.

     (iv) In the event the Corporation at any time or from time to time after
   June 15, 1995 makes or issues, or fixes a record date for the determination
   of holders of

                                        9

<PAGE>

   Common Stock entitled to receive a dividend or other distribution payable to
   all holders of Common Stock in securities of the Corporation Stock
   Equivalents, then, upon making such dividend or distribution provisions will
   be made so that the Holder will receive the amount of securities of the
   Corporation which it would have received had its Series A Preferred Stock
   been converted into Common Stock on the date of such event.

     (v) In the event the Corporation sells or issues any Common Stock, or sells
   or issues Common Stock Equivalents which can be converted into Common Stock
   at a per share consideration (as defined below in this subparagraph (v) of
   paragraph 7(B) less than the Stipulated Price then in effect, then the Holder
   shall be entitled to purchase from the Corporation in cash (for the same per
   share consideration at which such Common Stock was issued or the per share
   price at which a share of Common Stock is acquirable upon exercise or
   conversion of Common Stock Equivalents) that additional number of shares of
   Common Stock which, when added to the number of shares of Common Stock
   acquirable by the Holder upon conversion of any shares of Series A Preferred
   Stock outstanding and held by such Holder immediately before such issue or
   sale (the "Acquirable Shares"), will equal a percentage of the number of
   shares of Common Stock Deemed Outstanding (as defined herein) immediately
   after such sale or issuance that is the same as the percentage of the number
   of shares of Common Stock Deemed Outstanding immediately before such issuance
   or sale represented by the Acquirable Shares. This right shall exist for a
   forty-five-day period following the sale or issuance of shares of Common
   Stock or Common Stock Equivalents, and thereafter shall cease to exist.

   For the above purposes, the per share consideration with respect to the sale
   or issuance of Common Stock will be the price per share received by the
   Corporation, prior to the payment of any expenses, commissions, discounts and
   other applicable costs. With respect to the sale or issuance of Common Stock
   Equivalents which are convertible into or exchangeable for Common Stock
   without further consider, the per share consideration will be determined by
   dividing the maximum number of shares of Common Stock issuable with respect
   to such Common Stock Equivalents (as set forth in the instrument relating
   thereto without regard to any provisions contained therein for subsequent
   adjustment of such number) into the aggregate consideration receivable by the
   Corporation upon the sale or issuance of such Common Stock Equivalents. With
   respect to the issuance of other Common Stock Equivalents, the per share
   consideration will be determined by dividing the maximum number of shares of
   Common Stock issuable with respect to such Common Stock Equivalents into the
   total aggregate consideration received by the Corporation upon the sale or
   issuance of such Common Stock Equivalents plus the minimum aggregate amount
   of additional consideration received by the Corporation upon the conversion
   or exercise of such Common Stock Equivalents. In connection with the sale or
   issuance of Common

                                       10

<PAGE>

   Stock and/or Common Stock Equivalents for non-cash consideration, the amount
   of consideration will be the fair market value of such consideration as
   determined in good faith by the Board of Directors of the Corporation.

     (vi) As used herein, the term "Stipulated Price" means initial price of
   $1.00 per share of Common Stock, as adjusted from time to time pursuant to
   subparagraph (viii) of this paragraph 7(f); and the term "Common Stock
   Equivalent" means any securities (whether debt or equity securities) or
   rights issued by the Corporation convertible into or entitling the holder
   thereof to receive shares of, or securities convertible into, Common Stock.
   The number of shares of "Common Stock Deemed Outstanding" at any date shall
   equal the sum of the number of shares of Common Stock then outstanding plus
   the number of shares of Common Stock then obtainable pursuant to Common Stock
   Equivalents.

     (vii) In the event the Corporation declares any dividend or distribution
   payable to holders of its Common Stock (other than dividends payable out of
   the Corporation's retained earnings or earned surplus and dividends payable
   in shares of Common Stock or in securities convertible into or exchangeable
   for shares of Common Stock or rights or warrants to purchase Common Stock or
   securities convertible into or exchangeable for shares of Common Stock or any
   other securities issued by the Corporation), the Conversion Rate in effect
   immediately prior to the record date for such dividend or distribution shall
   be proportionately adjusted so that the Holder shall be entitled to receive
   the number of shares of Common Stock into which such shares of Common Stock
   or Preferred Stock was convertible immediately prior to such record date
   multiplied by a fraction, the numerator of which is the fair market value of
   a share of Common Stock on such record date and the denominator of which is
   such per share fair market value of a share of Common Stock on such record
   date less the fair market value on such record date of the securities or
   other property which are distributed as a dividend or other distribution. The
   term "fair market value" of a share of Common Stock or of any other security
   or other type of property on any date means (A) in the case of Common Stock
   or any other security (I) if the principal trading market for such Common
   Stock of other security is an exchange or the NASDAQ national market on such
   date, the closing price on such exchange or the NASDAQ national market on
   such date, provided, if trading of such Common Stock or other security is
   listed on any consolidated tape, the fair market value shall be the closing
   price set forth on such consolidated tape on such date, or (II) if the
   principal market for such Common Stock or other security is the over-the-
   counter market (other than the NASDAQ national market) the mean between the
   closing bid and asked prices on such date as set forth by NASDAQ or (B) in
   the case of Common Stock or any other security for which the fair market
   value cannot be determined pursuant to clause (A) above or of any other
   security or type of property, fair market value thereof on such date as
   determined in good faith by the Board of Directors.

                                       11

<PAGE>

       (viii) Whenever the Conversion Rate is adjusted pursuant to this
     paragraph (7)(f), the Stipulated Price shall also be adjusted by
     multiplying it by a fraction that is the reciprocal of the fraction used to
     adjust the Conversion Rate.

       (ix) The Corporation will not, by amendment of its Articles of
     Incorporation or through any dissolution, issuance or sale of securities or
     any other voluntary action, avoid or seek to avoid the observance or
     performance of any of the terms to be observed or performed hereunder by
     the Corporation, but at all times in good faith will assist in the carrying
     out of all the provisions of this paragraph and in the taking of all such
     action as may be necessary or appropriate in order to protect the
     conversion rights of the Holder against impairment.

       (x) No adjustment in the Conversion Rate shall be required, unless such
     adjustment would require an increase or decrease of at least one (1) share
     of Common Stock in the Conversion Rate of one share of Series A Preferred
     Stock, provided that all adjustments which do not meet this minimum
     requirement shall be cumulated and the adjustment will be made when the
     cumulated total is sufficient to require an adjustment. All calculations
     made pursuant to this subparagraph (x) of paragraph (7)(f) shall be made to
     the nearest one hundredth (1/100th) of a share of Common Stock.

     g. Fractional Shares. No fractional shares of Common Stock or scrip
        -----------------
representing fractional shares of Common Stock shall be issued upon any
conversion of shares of Series A Preferred Stock but, in lieu thereof, there
shall be paid an amount in cash equal to the same fraction of the current market
price of a whole share of Common Stock on the day preceding the day of
conversion.

     h. Statement to Transfer Agent. Whenever the Conversion Rate for
        ---------------------------
shares of Series A Preferred Stock shall be adjusted pursuant to the provisions
of paragraph (7)(f) hereof, the Corporation shall forthwith maintain at its
office and, if applicable, file with the Transfer Agent for shares of Series A
Preferred Stock and for shares of Common Stock, a statement signed by the
President or a Vice President of the Corporation and by its Treasurer or an
Assistant Treasurer, stating the adjusted Conversion Rate and setting forth in
reasonable detail the method of calculation and the facts requiring such
adjustment, such calculations to be confirmed by the Corporation's independent
auditors, and stating the faces on which the calculation is based. Each
adjustment shall remain in effect until a subsequent adjustment hereunder is
required.

     8. Registration Rights.
        -------------------

        a. Piggyback Registration. The Corporation, for a period ending six
           ----------------------
months after the last share of Series A Preferred Stock is redeemed, retired,
converted or otherwise no longer outstanding, will give written notice to the
Holder not less than 20 days in advance of the initial filing of any
registration statement under the Securities Act of 1933

                                       12

<PAGE>

(other than a registration Statement pertaining to securities issuable pursuant
to employee stock option, stock purchase, or similar plans or a registration
statement pertaining to securities issuable in connection with the acquisition
of a business, whether through merger, consolidation, acquisition of assets, or
exchange of securities) covering any Common Stock or other securities of the
Corporation, and will afford the Holder the opportunity to have included in such
registration all or such part of the shares of Common Stock acquired upon
conversion of Series A Preferred Stock, as may be designated by written notice
to the Corporation not later than 10 days following receipt of such notice from
the Corporation. The Corporation shall be entitled to exclude the shares of
Common Stock held by the Holder from any one, but not more than one, such
registration if the Corporation is advised by its investment banking firm that
the inclusion of such shares will, in the opinion of such investment banking
firm, materially interfere with the orderly sale and distribution of the
securities being offered under such registration statement by the Corporation.
Notwithstanding the foregoing, the Corporation shall not be entitled to exclude
the shares of Common Stock held by the Holder if shares of other shareholders
are being included in any such registration statement and, in such
circumstances, the Holder shall be entitled to include the shares of Common
Stock held by them on a pro rata basis in the proportion that the number of
shares of Common Stock held by the Holder bears to the shares of Common Stock
held by all other shareholders, including shares in such registration statement.
The Holder shall not be entitled to include shares in more than two registration
statement pursuant to the provisions of this subdivision a of paragraph (8), and
all rights of the Holder under this subdivision a of paragraph (8) shall
terminate after the Holder has included shares of Common Stock in two
registration statements pursuant to this subdivision a of paragraph (8).

        b. Expenses. The Corporation will pay all out-of-pocket costs and
           --------
expenses of any registration effected pursuant to the provisions of subdivision
(a) of this paragraph 8, including registration fees, legal fees, accounting
fees, printing expenses (including such number of any preliminary and the final
prospectus as may be reasonably requested), blue sky qualification fees and
expenses, and all other expenses, except for underwriting commissions or
discounts applicable to the shares of Common Stock being sold by the Holder and
the fees of counsel for the Holder, all of which shall be paid by the Holder.

     9. Reports.
        -------

     So long as any of the Series A Preferred Stock shall be outstanding, the
Corporation shall submit to the Holder financial reports no less frequently than
annually.

     10. Miscellaneous.
         -------------

          a. As used herein, the term "Common Stock" shall mean the
Corporation's Common Stock, $1.00 per share, or, in the case of any
reclassification or change of outstanding shares of Common Stock, the stock or
securities issued in exchange

                                       13

<PAGE>

for such Common Stock. The term "Common Stock" shall also include any capital
stock of the Corporation authorized after June 15, 1995 which shall not be
limited to a fixed sum or sums or percentage or percentages of par value in
respect of the rights of the holders thereof to participate in dividends or in
the distribution of assets upon the voluntary or involuntary liquidation,
dissolution or winding up of the Corporation.

          b. The shares of Series A Preferred Stock shall be fully transferrable
by the Holder thereof, subject to compliance with the applicable provisions of
federal and state securities laws.

     IN WITNESS WHEREOF, RETRACTABLE TECHNOLOGIES, INC. has caused its corporate
seal to be hereunto affixed and this Certificate to be signed by its President
and Secretary this _______ day of May, 1995.


                                        /s/ Thomas J. Shaw
                                        ----------------------------------------
                                        President

ATTEST:

/s/ Lillian E. Salerno
----------------------------------
Secretary

                                       14

<PAGE>

                                                                       EXHIBIT B

                                                                FILED
                                                         In the Office of the
                                                     Secretary of State of Texas
                                                             MAY 15 1996
                                                        Corporations Section

                     CERTIFICATE OF DESIGNATION, PREFERENCES
                        RIGHTS AND LIMITATIONS OF Class B
                           CONVERTIBLE PREFERRED STOCK
                                       OF
                         RETRACTABLE TECHNOLOGIES, INC.

     Pursuant to Article 2.13 of the Texas Business Corporation Act and Article
Five of its Articles of Incorporation, Retractable Technologies, Inc., a
corporation organized and existing under the laws of the State of Texas (the
Corporation),

     DOES HEREBY CERTIFY that pursuant to the authority conferred upon the Board
of Directors of the Corporation by the Articles of Incorporation, as amended,
and pursuant to Article 2.13 of the Texas Business Corporation Act, said Board
of Directors, by unanimous written consent executed May 10, 1995, adopted a
resolution providing for the creation of a series of Preferred Stock consisting
of not more than five million (5,000,000) shares of Class B Convertible
Preferred Stock, which resolution is and reads as follows:

     RESOLVED that, pursuant to the authority provided in the Corporation's
Articles of Incorporation and expressly granted to and vested in the Board of
Directors of Retractable Technologies, Inc. (the "Corporation"), the Board of
Directors hereby creates out of the Preferred Stock, par value one dollar per
share, of the Corporation a series of Class B Preferred Stock consisting of not
more than five million (5,000,000) shares, and the Board of Directors hereby
fixes the designation and the powers, preference and rights, and the
qualifications, limitations and restrictions thereof, to the extent not
otherwise provided in the Corporation's qualifications, limitations and
restrictions thereof, to the extent not otherwise provided in the Corporation's
Articles of Incorporation, as follows:

     1. Designation of series. The designation of the series of Preferred
        ---------------------
Stock created by this resolution shall be "Class B Convertible Preferred Stock"
(the "Class B Preferred Stock").

     2. Dividends on Class B Preferred Stock.
        ------------------------------------

          a. Dividend Amount. The holders of the Class B Preferred Stock
             ---------------
shall be entitled to receive, in any calendar year, if when and as declared by
the Board of Directors, out of any assets at the time legally available therefor
and subject to the further limitations set out herein, dividends at the per
annum rate of $0.50 per share, all such dividends due quarterly in arrears as of
the last day of each March, June, September and December of each year, the first
dividend being declarable on December 31, 1996. On each

                                   1

<PAGE>

date which a dividend may be declared is hereafter called the "Dividend Date,"
and each quarterly period ending with a Dividend Date is hereinafter referred to
as the "Dividend Period." Dividends shall be payable fifteen calendar days after
the Dividend Due Date, provided however, that if such date on which a dividend
is payable is a Saturday, Sunday or legal holiday, such dividend shall be
payable on the next following business day to the holders of record (whether
singular or plural, the "Holder").

          b. Dividends Cumulative. Dividends upon the Class B Preferred Stock
             --------------------
shall be accrued and be cumulative, whether or not in any Dividend Period or
Periods there shall be funds of the Corporation legally available for the
payment of such dividends.

          c. Dividend Accrual. On each Dividend Due Date all dividends which
             ----------------
shall have accrued since the last Dividend Due Date on each share of Class B
Preferred Stock outstanding on such Dividend Due Date shall accumulate and be
deemed to become "due." Any dividend which shall not be paid on the Dividend Due
Date on which it shall become due shall be deemed to be "past due" until such
dividend shall be paid or until the share of Class B Preferred Stock with
respect to which such dividend became due shall no longer be outstanding,
whichever is the earlier to occur. No interest, sum of money in lieu of interest
or other property or securities shall be payable in respect of any dividend
payment or payments which are past due. Dividends paid on shares of Class B
Preferred Stock in an amount less that the total amount of such dividends at the
time accumulated and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding. Dividend
payments made with respect to a Dividend Due Date shall be deemed to be made in
payment of the dividends which became due on that Dividend Due Date.

          d. Dividend Arrearage. If a dividend upon any shares of Class B
             ------------------
Preferred Stock is in arrears, all dividends or other distributions declared
upon shares of the Class B Preferred Stock (other than dividends paid in stock
of the Corporation ranking junior to the Class B Preferred Stock as to dividends
and upon liquidation, dissolution or winding up) may only be declared pro rata.
Except as set forth above, if a dividend upon any shares of Class B Preferred
Stock is in arrears: (i) no dividends (in cash, stock or other property) may be
paid or declared and set aside for payment or any other distribution made upon
any stock of the Corporation ranking junior to the Class B Preferred Stock as to
dividends (other than dividends of distributions in stock of the Corporation
ranking junior to the Class B Preferred Stock as to dividends and upon
liquidation, dissolution or winding up); and (ii) no stock of the Corporation
ranking junior to the Class B Preferred Stock as to dividends may be (A)
redeemed pursuant to a sinking fund of otherwise, except (1) by means of
redemption pursuant to which all outstanding shares of the Class B Preferred
Stock are redeemed, or (2) by conversion of any such junior stock into, or
exchange of any such junior stock into, or exchange of any such junior stock for
stock of the Corporation ranking junior to the Class B Preferred Stock as to
dividends and upon liquidation, dissolution or winding

                                        2

<PAGE>

up, or (B) purchased or otherwise acquired for any consideration by the
Corporation except (1) pursuant to an acquisition made pursuant to the terms of
one or more offers to purchase all of the outstanding shares of the Class B
Preferred Stock, which offers shall each have been accepted by the holders of at
least 50% of the shares of the Class B Preferred Stock receiving such offer
outstanding at the commencement of the first of such purchase offers, or (2) by
conversion into or exchange for stock of the Corporation ranking junior to the
Class B Preferred Stock as to dividends and upon liquidation, dissolution or
winding up.

     3. General, Class and Series Voting Rights. Except as provided in this
        ---------------------------------------
Section 3 and in Section 4 hereof or as otherwise from time to time required by
law, the Class B Preferred Stock shall have no voting rights.

     So long as any shares of Class B Preferred Stock remain outstanding, the
consent of the holders of at least fifty-one (51%) percent of the shares of
Class B Preferred Stock outstanding at the time voting separately as a class,
given in person or by proxy, either in writing at any special or annual meeting
called for the purpose, shall be necessary to permit, effect or validate any one
or more of the following:

        (i) The authorization, creation or issuance, or any increase in the
     authorized or issued amount, of any class or series of stock (including any
     class or series of Preferred Stock) ranking equal or prior (as the terms
     are hereinafter defined in this Section 3) to the Class B Preferred Stock;
     or

        (ii) The amendment, alteration or repeal, whether by merger,
     consolidation or otherwise, of any of the provisions of the Articles of
     Incorporation or of this resolution which would alter or change the powers,
     preferences or special rights of the shares of the Class B Preferred Stock
     so as to affect them adversely; provided, however, that any increase in the
     amount of authorized Preferred Stock, or the creation and issuance of other
     series of Preferred Stock ranking junior to the Class B Preferred Stock
     with respect to the payment of dividends and the distribution of assets
     upon liquidation, dissolution or winding up, shall not be deemed to
     adversely affect such powers, preferences or special rights.

     The foregoing voting provisions shall not apply if, at or prior to the time
when the act with respect to which such vote would otherwise be required shall
be effected, all outstanding shares of Class B Preferred Stock shall have been
redeemed or sufficient funds shall have been deposited in trust to effect such
redemption.

     4. Redemption. The outstanding shares of Class B Preferred Stock shall
        ----------
be nonredeemable prior to the lapse of three (3) years from the date of
issuance. On and after such date, the Class B Preferred Stock may be redeemed at
the option of the Corporation, as a whole at any time or in part from time to
time, at the Redemption Price of $7.50 per share plus all dividends (whether or
not declared or due) accrued and unpaid to the date of

                                        3

<PAGE>

redemption (subject to the right of the holder of record of shares of Class B
Preferred Stock on a record date for the payment of a dividend on the Class B
Preferred Stock to receive the dividend due on such shares of Class B Preferred
Stock on the corresponding Dividend Due Date.)

     No sinking fund shall be established for the Class B Preferred Stock.

     Notice of any proposed redemption of shares of Class B Preferred Stock
shall be mailed by means of first class mail, postage paid, addressed to the
holders of record of the shares of Class B Preferred Stock to be redeemed, at
their respective addresses then appearing on the books of the Corporation, at
least thirty (30) but not more than sixty (60) days prior to the date fixed for
such redemption (herein referred to as the "Redemption Date"). Each such notice
shall specify (i) the Redemption Date; (ii) the Redemption Price; (iii) the
place for payment and for delivering the stock certificate(s) and transfer
instrument(s) in order to collect the Redemption Price; (iv) the shares of Class
B Preferred Stock to be redeemed; and (v) the then effective Conversion Price
(as defined below) and that the right of holders of shares of Class B Preferred
Stock being redeemed to exercise their conversion right shall terminate as to
such shares at the close of business on the fifth day before the Redemption Date
(provided that no default by the Corporation in the payment of the applicable
Redemption Price (including any accrued and unpaid dividends) shall have
occurred and be continuing. Any notice mailed in such manner shall be
conclusively deemed to have been duly given whether or not such notice is in
fact received. If less than all the outstanding shares of Class B Preferred
Stock are to be redeemed, the Corporation will select those to be redeemed by
lot or by a substantially equivalent method. In order to facilitate the
redemption of Class B Preferred Stock to be redeemed, which shall not be more
than sixty (60) days prior to the Redemption Date with respect thereto.

     The holder of any shares of Class B Preferred Stock redeemed upon any
exercise of the Corporation's redemption right shall not be entitled to receive
payment of the Redemption Price for such shares until such holder shall cause to
be delivered to the place specified in the notice given with respect to such
redemption (i) the certificate(s) representing such shares of Class B Preferred
Stock; and (ii) transfer instrument(s) satisfactory to the Corporation and
sufficient to transfer such shares of Class B Preferred Stock to the Corporation
free of any adverse interest. No interest shall accrue on the Redemption Price
of any share of Class B Preferred Stock after its Redemption Date.

     Subject to Section 2 hereof, the Corporation shall have the right to
purchase shares of Class B Preferred Stock from the owner of such shares on such
terms as may be agreeable to such owner. Shares of Class B Preferred Stock may
be acquired by the Corporation from any stockholder pursuant to this paragraph
without offering any other stockholder an equal opportunity to sell his stock to
the Corporation, and no purchase by the Corporation from any stockholder
pursuant to this paragraph shall be deemed to create any right on the part of
any stockholder to sell any shares of Class B Preferred Stock (or any other
stock) to the Corporation.

                                        4

<PAGE>

     Notwithstanding the foregoing provisions of this Section 4, and subject to
the provisions of Section 2 hereof, if a dividend upon any shares of Class B
Preferred Stock is past due, (i) no shares of the Class B Preferred Stock may be
redeemed, except (A) by means of a redemption pursuant to which all outstanding
shares of the Class B Preferred Stock are simultaneously redeemed (or offered to
be so redeemed) or pursuant to which the outstanding shares of the Class B
Preferred Stock are redeemed on a pro rata basis (or offered to be so redeemed),
or (B) by conversion of shares of Class B Preferred Stock into, or exchange of
such shares for, Common Stock or any other stock of the Corporation ranking
junior to the Class B Preferred Stock as to dividends and upon liquidation,
dissolution or winding up.

     5. Liquidation. In the event of any voluntary or involuntary
        -----------
dissolution, liquidation or winding up of the Corporation (for the purposes of
this Section 5, a "Liquidation"), before any distribution of assets shall be
made to the holders of the Common Stock or the holders of any other stock that
ranks junior to the Class B Preferred Stock in respect of distributions upon the
Liquidation of the Corporation, the holder of each share of Class B Preferred
Stock then outstanding shall be entitled to $6.25 per share plus all dividends
(whether or not declared or due) accrued and unpaid on such share on the date
fixed for the distribution of assets of the Corporation to the holders of Class
B Preferred Stock.

     If upon any Liquidation of the Corporation, the assets available for
distribution to the holder of Class B Preferred Stock which shall then be
outstanding (hereinafter in this paragraph called the "Total Amount Available")
shall be insufficient to pay the holders of all outstanding shares of Class B
Preferred Stock the full amounts (including all dividends accrued and unpaid) to
which they shall be entitled by reason of such Liquidation of the Corporation,
then there shall be paid ratably to the holders of the Class B Preferred Stock
in connection with such Liquidation of the Corporation, an amount equal to each
holder's pro rata share of the Total Amount Available.

     The voluntary sale, conveyance, lease, exchange or transfer of all or
substantially all the property or assets of the Corporation, or the merger or
consolidation of the Corporation into the Corporation, or any purchase or
redemption of some or all of the shares of any class or series of stock of the
Corporation, shall not be deemed to be a Liquidation of the Corporation for the
purposes of this Section 5 (unless in connection therewith the Liquidation of
the Corporation is specifically approved).

     6. Conversion Privilege. At any time subsequent to three years after
        --------------------
issuance of any share of Class B Preferred Stock, the holder of any share of
Class B Preferred Stock ("Holder") shall have the right, at such Holder's option
(but if such share is called for redemption or exchange at the election of the
Corporation, then in respect of such share only to and including but not after
the close of business on (i) the fifth calendar day before the

                                        5

<PAGE>

date fixed for such redemption; or (ii) the date fixed for such exchange,
provided that the Corporation has set aside funds sufficient to effect such
redemption to convert such share into that number of fully paid and non-
assessable shares of Common Stock (calculated as to each conversion to the
nearest 1/100th of a share) obtained by dividing $5.00 by the Conversion Rate
then in effect.

          a. Conversion Rate. Each share of Class B Preferred Stock may be
             ---------------
converted, subject to the terms and provisions of this paragraph 6 into one (1)
share of the Corporation's Common Stock, which is a price equal to one share of
Common Stock for each $5.00 of Class B Preferred Stock or, in case an adjustment
of such rate has taken place pursuant to the provisions of subdivision (f.) of
this paragraph (6), then at the Conversion Rate as last adjusted (such rate or
adjusted rate, shall be expressed as the number of shares of Common Stock to be
acquired upon conversion of one share of Class B Preferred Stock, and shall be
referred to herein as the "Conversion Rate"). Each share of Class B Preferred
Stock shall be Convertible into Common Stock by surrender to the corporation of
the certificate representing such shares of Class B Preferred Stock to be
converted by the Holder and by giving written notice to the Corporation of the
Holder's election to convert.

     The Corporation shall, as soon as practicable after receipt of such written
notice and the proper surrender to the Corporation of the certificate or
certificates representing shares of Class B Preferred Stock to be converted in
accordance with the above provisions, issue and deliver for the benefit of the
Holder at the office of the Corporation's duly appointed transfer agent (the
"Transfer Agent") to the Holder for whose account such shares of Class B
Preferred Stock were so surrendered or to such Holder's nominee or nominees,
certificates for the number of shares of Common Stock to which the Holder shall
be entitled. The certificates of Common Stock of the Corporation issued upon
conversion shall bear such legends as may be required by state or federal laws.
Such conversion shall be deemed to have been effective immediately prior to the
close of business on the date on which the Corporation shall have received both
such written notice and the properly surrendered certificates for shares of
Class B Preferred Stock to be converted (the "Conversion Date"), and at such
time the rights of the Holder shall cease and the person or persons entitled to
receive the shares of Common Stock issuable upon the conversion of such shares
of Class B Preferred Stock shall be deemed to be, and shall be treated for all
purposes as, the record Holder or Holders of such Common Stock on the Conversion
Date. The Corporation shall not be required to convert, and no surrender of
shares of Class B Preferred Stock or written notice of conversion with respect
thereto shall be effected for that purpose, while the stock transfer books of
the Corporation are closed for any reasonable business purpose for any
reasonable period of time, but the proper surrender of shares of Class B
Preferred Stock for conversion immediately upon the reopening of such books.
During the period in which the stock transfer books of the Corporation are
closed, the Corporation may neither declare a dividend, declare a record date
for payment of dividends nor make any payment of dividends.

                                        6

<PAGE>

          b. Dividends. If any shares of Class B Preferred Stock shall be
             ---------
converted during any dividend payment period, the Holder shall be entitled to
all dividends accrued up to and through such Conversion Date, at the rate set
forth herein, whether or not there has been a dividend date, as set forth in
paragraph 2 hereof.

          c. Cancellation. Class B Preferred Stock converted into Common
             ------------
Stock pursuant to the provisions of this paragraph (6), shall be retired and
cancelled by the Corporation and given the status of authorized and unissued
preferred stock.

          d. Reissuance if Conversion is Partial. In the case of any
             -----------------------------------
certificate representing shares of Class B Preferred Stock which is surrendered
for conversion only in part, the Corporation shall issue and deliver to the
Holder a new certificate or certificates for Class B Preferred Stock of such
denominations as requested by the Holder in the amount of Class B Preferred
Stock equal to the unconverted shares of the Class B Preferred Stock represented
by the certificate so surrendered.

          e. Reservations of Shares. The Corporation shall at all times
             ----------------------
during which shares of Class B Preferred Stock may be converted into Common
Stock as provided in this paragraph (e), reserve and keep available, out of any
Common Stock held as treasury stock or out of its authorized and unissued Common
Stock, or both, solely for the purpose of delivery upon conversion of the shares
of Class B Preferred Stock as herein provided, such number of shares of Common
Stock as shall then be sufficient to effect the conversion of all shares of
Class B Preferred Stock from time to time outstanding, and shall take such
action as may from time to time be necessary to ensure that such shares of
Common Stock will, when issued upon conversion of Class B Preferred Stock, be
fully paid and nonassessable.

          f. Adjustment of Conversion Rate. The Conversion Rate provided in
             -----------------------------
subdivision (a) of this paragraph (6), in respect of Class B Preferred Stock,
shall be subject to adjustments from time to time as follows:

     (i) While any shares of Class B Preferred Stock shall be outstanding, in
   case the Corporation shall subdivide the outstanding shares of Common Stock
   into a greater number of shares of Common Stock or combine the outstanding
   shares of Common Stock into a smaller number of shares of Common Stock, or
   issue, by reclassification of its shares of Common Stock, any shares of the
   Corporation, the Conversion Rate in effect immediately prior thereto shall be
   adjusted so that the Holder shall be entitled to receive the number of shares
   which it would have owned or been entitled to receive after the happening of
   any of the events described above, had such shares of Class B Preferred Stock
   been converted immediately prior to the happening of such event, such
   adjustment to become effective immediately after the opening of business on
   the day following the day upon which such subdivision or combination or
   reclassification, as the case may be, becomes effective.

                                        7

<PAGE>

     (ii) In case the Corporation shall be consolidated with, or merge into, any
   other corporation, and the Corporation does not survive, proper provisions
   shall be made as a part of the terms of such consolidation or merger, whereby
   the Holder shall thereafter be entitled, upon exercise of such Holder's
   conversion rights, to receive the kind and amount of shares of stock or other
   securities of the Corporation resulting from such consolidation or merger, or
   such other property, as the Holder would have received if such conversion
   rights were exercised immediately prior to the effectiveness of such merger
   of consolidation.

     (iii) In the event the Corporation at any time, or from time to time after
   June 15, 1996 makes or issues, or fixes a record date for the determination
   of holders of Common Stock entitled to receive, a dividend or other
   distribution payable in additional shares of Common Stock or Common Stock
   Equivalents (as defined herein) which does not provide for the payment of any
   consideration upon the issuance, conversion or exercise thereof, without a
   corresponding dividend or other distribution to the Holder, based upon the
   number of shares of Common Stock into which the Class B Preferred Stock is
   convertible, then and in each such event the Conversion Rate then in effect
   will be increased as of the time of such issuance or, in the event such a
   record date shall have been fixed, as of the close of business on such record
   date, by multiplying such Conversion Rate by a fraction:

               (A) The number of which will be the total number of shares of
           Common Stock issues and outstanding immediately prior to the time of
           such issuance or the close of business on such record date plus the
           number of shares of Common Stock issuable in payment of such dividend
           or distribution (which, in the case of Common Stock Equivalents,
           shall mean the maximum number of shares of Common Stock issuable with
           respect thereto, as set forth in the instrument relative thereto
           without regard to any provision for subsequent adjustment); and

               (B) The denominator of which will be the total number of shares
           of Common Stock issued and outstanding immediately prior to the time
           of such issuance or the close of business on such record date;

   provided, however, that if such record date is fixed and such dividend is not
   fully paid or if such distribution is not fully made on the date fixed
   therefor, the Conversion Rate will be recomputed accordingly as of the close
   of business on such record date, and thereafter such Conversion Rate will be
   adjusted pursuant to this subparagraph (iii) as of the time of actual payment
   of such dividends of distributions.

     (iv) In the event the Corporation at any time or from time to time after
   June 15, 1996 makes or issues, or fixes a record date for the determination
   of holders of

                                        8

<PAGE>

   Common Stock entitled to receive a dividend or other distribution payable to
   all holders of Common Stock in securities of the Corporation Stock
   Equivalents, then, upon making such dividend or distribution provisions will
   be made so that the Holder will receive the amount of securities of the
   Corporation which it would have received had its Class B Preferred Stock been
   converted into Common Stock on the date of such event.

     (v) In the event the Corporation sells or issues any Common Stock, or sells
   or issues Common Stock Equivalents which can be converted into Common Stock
   at a per share consideration (as defined below in this subparagraph (v) of
   paragraph 7(B) less than the Stipulated Price then in effect, then the Holder
   shall be entitled to purchase from the Corporation in cash (for the same per
   share consideration at which such Common Stock was issued or the per share
   price at which a share of Common Stock is acquirable upon exercise or
   conversion of Common Stock Equivalents) that additional number of shares of
   Common Stock which, when added to the number of shares of Common Stock
   acquirable by the Holder upon conversion of any shares of Class B Preferred
   Stock outstanding and held by such Holder immediately before such issue or
   sale (the "Acquirable Shares"), will equal a percentage of the number of
   shares of Common Stock Deemed Outstanding (as defined herein) immediately
   after such sale or issuance that is the same as the percentage of the number
   of shares of Common Stock Deemed Outstanding immediately before such issuance
   or sale represented by the Acquirable Shares. This right shall exist for a
   forty-five-day period following the sale or issuance of shares of Common
   Stock or Common Stock Equivalents, and thereafter shall cease to exist.

   For the above purposes, the per share consideration with respect to the sale
   or issuance of Common Stock will be the price per share received by the
   Corporation, prior to the payment of any expenses, commissions, discounts and
   other applicable costs. With respect to the sale or issuance of Common Stock
   Equivalents which are convertible into or exchangeable for Common Stock
   without further consider, the per share consideration will be determined by
   dividing the maximum number of shares of Common Stock issuable with respect
   to such Common Stock Equivalents (as set forth in the instrument relating
   thereto without regard to any provisions contained therein for subsequent
   adjustment of such number) into the aggregate consideration receivable by the
   Corporation upon the sale or issuance of such Common Stock Equivalents. With
   respect to the issuance of other Common Stock Equivalents, the per share
   consideration will be determined by dividing the maximum number of shares of
   Common Stock issuable with respect to such Common Stock Equivalents into the
   total aggregate consideration received by the Corporation upon the sale or
   issuance of such Common Stock Equivalents plus the minimum aggregate amount
   of additional consideration received by the Corporation upon the conversion
   or exercise of such Common Stock Equivalents. In connection with the sale or
   issuance of Common

                                        9

<PAGE>

   Stock and/or Common Stock Equivalents for non-cash consideration, the amount
   of consideration will be the fair market value of such consideration as
   determined in good faith by the Board of Directors of the Corporation.

     (vi) As used herein, the term "Stipulated Price" means initial price of
   $5.00 per share of Common Stock, as adjusted from time to time pursuant to
   subparagraph (viii) of this paragraph 7(f); and the term "Common Stock
   Equivalent" means any securities (whether debt or equity securities) or
   rights issued by the Corporation convertible into or entitling the holder
   thereof to receive shares of, or securities convertible into, Common Stock.
   The number of shares of "Common Stock Deemed Outstanding" at any date shall
   equal the sum of the number of shares of Common Stock then outstanding plus
   the number of shares of Common Stock then obtainable pursuant to Common Stock
   Equivalents.

     (vii) In the event the Corporation declares any dividend or distribution
   payable to holders of its Common Stock (other than dividends payable out of
   the Corporation's retained earnings or earned surplus and dividends payable
   in shares of Common Stock or in securities convertible into or exchangeable
   for shares of Common Stock or rights or warrants to purchase Common Stock or
   securities convertible into or exchangeable for shares of Common Stock or any
   other securities issued by the Corporation), the Conversion Rate in effect
   immediately prior to the record date for such dividend or distribution shall
   be proportionately adjusted so that the Holder shall be entitled to receive
   the number of shares of Common Stock into which such shares of Common Stock
   or Preferred Stock was convertible immediately prior to such record date
   multiplied by a fraction, the numerator of which is the fair market value of
   a share of Common Stock on such record date and the denominator of which is
   such per share fair market value of a share of Common Stock on such record
   date less the fair market value on such record date of the securities or
   other property which are distributed as a dividend or other distribution. The
   term "fair market value" of a share of Common Stock or of any other security
   or other type of property on any date means (A) in the case of Common Stock
   or any other security (I) if the principal trading market for such Common
   Stock of other security is an exchange or the NASDAQ national market on such
   date, the closing price on such exchange or the NASDAQ national market on
   such date, provided, if trading of such Common Stock or other security is
   listed on any consolidated tape, the fair market value shall be the closing
   price set forth on such consolidated tape on such date, or (II) if the
   principal market for such Common Stock or other security is the over-the-
   counter market (other than the NASDAQ national market) the mean between the
   closing bid and asked prices on such date as set forth by NASDAQ or (B) in
   the case of Common Stock or any other security for which the fair market
   value cannot be determined pursuant to clause (A) above or of any other
   security or type of property, fair market value thereof on such date as
   determined in good faith by the Board of Directors.

                                       10

<PAGE>

       (viii) Whenever the Conversion Rate is adjusted pursuant to this
     paragraph (6)(f), the Stipulated Price shall also be adjusted by
     multiplying it by a fraction that is the reciprocal of the fraction used to
     adjust the Conversion Rate.

       (ix) The Corporation will not, by amendment of its Articles of
     Incorporation or through any dissolution, issuance or sale of securities or
     any other voluntary action, avoid or seek to avoid the observance or
     performance of any of the terms to be observed or performed hereunder by
     the Corporation, but at all times in good faith will assist in the carrying
     out of all the provisions of this paragraph and in the taking of all such
     action as may be necessary or appropriate in order to protect the
     conversion rights of the Holder against impairment.

       (x) No adjustment in the Conversion Rate shall be required, unless such
     adjustment would require an increase or decrease of at least one (1) share
     of Common Stock in the Conversion Rate of one share of Class B Preferred
     Stock, provided that all adjustments which do not meet this minimum
     requirement shall be cumulated and the adjustment will be made when the
     cumulated total is sufficient to require an adjustment. All calculations
     made pursuant to this subparagraph (x) of paragraph (6)(f) shall be made to
     the nearest one hundredth (1/100th) of a share of Common Stock.

     g. Fractional Shares. No fractional shares of Common Stock or scrip
        -----------------
representing fractional shares of Common Stock shall be issued upon any
conversion of shares of Class B Preferred Stock but, in lieu thereof, there
shall be paid an amount in cash equal to the same fraction of the current market
price of a whole share of Common Stock on the day preceding the day of
conversion.

     h. Statement to Transfer Agent. Whenever the Conversion Rate for
        ---------------------------
shares of Class B Preferred Stock shall be adjusted pursuant to the provisions
of paragraph (6)(f) hereof, the Corporation shall forthwith maintain at its
office and, if applicable, file with the Transfer Agent for shares of Class B
Preferred Stock and for shares of Common Stock, a statement signed by the
President or a Vice President of the Corporation and by its Treasurer or an
Assistant Treasurer, stating the adjusted Conversion Rate and setting forth in
reasonable detail the method of calculation and the facts requiring such
adjustment, such calculations to be confirmed by the Corporation's independent
auditors, and stating the faces on which the calculation is based. Each
adjustment shall remain in effect until a subsequent adjustment hereunder is
required.

     7.   Registration Rights.
          -------------------

          a. Piggyback Registration. The Corporation, for a period ending
             ----------------------
six months after the last share of Class B Preferred Stock is redeemed, retired,
converted or otherwise no longer outstanding, will give written notice to the
Holder not less than 20 days in advance of the initial filing of any
registration statement under the Securities Act of 1933

                                       11

<PAGE>

(other than a registration Statement pertaining to securities issuable pursuant
to employee stock option, stock purchase, or similar plans or a registration
statement pertaining to securities issuable in connection with the acquisition
of a business, whether through merger, consolidation, acquisition of assets, or
exchange of securities) covering any Common Stock or other securities of the
Corporation, and will afford the Holder the opportunity to have included in such
registration all or such part of the shares of Common Stock acquired upon
conversion of Class B Preferred Stock, as may be designated by written notice to
the Corporation not later than 10 days following receipt of such notice from the
Corporation. The Corporation shall be entitled to exclude the shares of Common
Stock held by the Holder from any one, but not more than one, such registration
if the Corporation is advised by its investment banking firm that the inclusion
of such shares will, in the opinion of such investment banking firm, materially
interfere with the orderly sale and distribution of the securities being offered
under such registration statement by the Corporation. Notwithstanding the
foregoing, the Corporation shall not be entitled to exclude the shares of Common
Stock held by the Holder if shares of other shareholders are being included in
any such registration statement and, in such circumstances, the Holder shall be
entitled to include the shares of Common Stock held by them on a pro rata basis
in the proportion that the number of shares of Common Stock held by the Holder
bears to the shares of Common Stock held by all other shareholders, including
shares in such registration statement. The Holder shall not be entitled to
include shares in more than two registration statement pursuant to the
provisions of this subdivision a of paragraph (7), and all rights of the Holder
under this subdivision a of paragraph (7) shall terminate after the Holder has
included shares of Common Stock in two registration statements pursuant to this
subdivision a of paragraph (7).

          b. Expenses. The Corporation will pay all out-of-pocket costs and
             --------
expenses of any registration effected pursuant to the provisions of subdivision
(a) of this paragraph 7, including registration fees, legal fees, accounting
fees, printing expenses (including such number of any preliminary and the final
prospectus as may be reasonably requested), blue sky qualification fees and
expenses, and all other expenses, except for underwriting commissions or
discounts applicable to the shares of Common Stock being sold by the Holder and
the fees of counsel for the Holder, all of which shall be paid by the Holder.

     8. Reports.
        -------

        So long as any of the Class B Preferred Stock shall be outstanding,
the Corporation shall submit to the Holder financial reports no less frequently
than annually.

     9. Miscellaneous.
        -------------

        a. As used herein, the term "Common Stock" shall mean the
Corporation's Common Stock, no par value, or, in the case of any
reclassification or change of outstanding shares of Common Stock, the stock or
securities issued in exchange for such Common Stock. The term "Common Stock"
shall also include any capital stock of the

                                       12

<PAGE>

Corporation authorized after June 15, 1995 which shall not be limited to a fixed
sum or sums or percentage or percentages of par value in respect of the rights
of the holders thereof to participate in dividends or in the distribution of
assets upon the voluntary or involuntary liquidation, dissolution or winding up
of the Corporation.

          b. The shares of Class B Preferred Stock shall be fully transferrable
by the Holder thereof, subject to compliance with the applicable provisions of
federal and state securities laws.

     IN WITNESS WHEREOF, RETRACTABLE TECHNOLOGIES, INC. has caused its corporate
seal to be hereunto affixed and this Certificate to be signed by its President
and Secretary this 30 day of April, 1996.




                                        /s/ Thomas J. Shaw
                                        ----------------------------------
                                        President

ATTEST:

/s/ Lillian E. Salerno
--------------------------------
Secretary

                                       13

<PAGE>

                                                                       EXHIBIT C

                                                               FILED
                                                        In the Office of the
                                                     Secretary of State of Texas
                                                            MAY 27 1997
                                                       Corporations Section

                    CERTIFICATE OF DESIGNATION, PREFERENCES
                RIGHTS AND LIMITATIONS OF THE SERIES II CLASS B
                           CONVERTIBLE PREFERRED STOCK
                                       OF
                         RETRACTABLE TECHNOLOGIES, INC.

     Pursuant to Article 2.13 of the Texas Business Corporation Act and Article
Five of its Articles of Incorporation, Retractable Technologies, Inc., a
corporation organized and existing under the laws of the State of Texas (the
Corporation),

     DOES HEREBY CERTIFY that pursuant to the authority conferred upon the Board
of Directors of the Corporation by the Articles of Incorporation, as amended,
and pursuant to Article 2.13 of the Texas Business Corporation Act, said Board
of Directors, by unanimous written consent executed May 10, 1995, adopted a
resolution providing for the creation of a series of Preferred Stock consisting
of not more than five million (5,000,000) shares of Series II Class B
Convertible Preferred Stock, which resolution is and reads as follows:

     RESOLVED that, pursuant to the authority provided in the Corporation's
Articles of Incorporation and expressly granted to and vested in the Board of
Directors of Retractable Technologies, Inc. (the "Corporation"), the Board of
Directors hereby creates out of the Preferred Stock, par value one dollar per
share, of the Corporation a series of Series II Class B Preferred Stock
consisting of not more than five million (5,000,000) shares, and the Board of
Directors hereby fixes the designation and the powers, preference and rights,
and the qualifications, limitations and restrictions thereof, to the extent not
otherwise provided in the Corporation's qualifications, limitations and
restrictions thereof, to the extent not otherwise provided in the Corporation's
Articles of Incorporation, as follows:

     1. Designation of Series. The designation of the series of Preferred
        ---------------------
Stock created by this resolution shall be "Series II Class B Convertible
Preferred Stock" (the "Series II Class B Preferred Stock").

     2. Dividends on Series II Class B Preferred Stock.
        ----------------------------------------------

        a. Dividend Amount. The holders of the Series II Class B Preferred
           ---------------
Stock shall be entitled to receive, in any calendar year, if when and as
declared by the Board of Directors, out of any assets at the time legally
available therefor and subject to the further limitations set out herein,
dividends at the per annum rate of $1.00 per share, all such dividends due
quarterly in arrears as of the last day of each March, June, September and
December of each year, the first dividend being declarable on December 31, 1997.
On each


                                        1

<PAGE>

date which a dividend may be declared is hereafter called the "Dividend Date,"
and each quarterly period ending with a Dividend Date is hereinafter referred to
as the "Dividend Period." Dividends shall be payable fifteen calendar days after
the Dividend Due Date, provided however, that if such date on which a dividend
is payable is a Saturday, Sunday or legal holiday, such dividend shall be
payable on the next following business day to the holders of record (whether
singular or plural, the "Holder").

          b. Dividends Cumulative. Dividends upon the Series II Class B
             --------------------
Preferred Stock shall be accrued and be cumulative, whether or not in any
Dividend Period or Periods there shall be funds of the Corporation legally
available for the payment of such dividends.

          c. Dividend Accrual. On each Dividend Due Date all dividends which
             ----------------
shall have accrued since the last Dividend Due Date on each share of Series II
Class B Preferred Stock outstanding on such Dividend Due Date shall accumulate
and be deemed to become "due." Any dividend which shall not be paid on the
Dividend Due Date on which it shall become due shall be deemed to be "past due"
until such dividend shall be paid or until the share of Series II Class B
Preferred Stock with respect to which such dividend became due shall no longer
be outstanding, whichever is the earlier to occur. No interest, sum of money in
lieu of interest or other property or securities shall be payable in respect of
any dividend payment or payments which are past due. Dividends paid on shares of
Series II Class B Preferred Stock in an amount less that the total amount of
such dividends at the time accumulated and payable on such shares shall be
allocated pro rata on a share-by-share basis among all such shares at the time
outstanding. Dividend payments made with respect to a Dividend Due Date shall be
deemed to be made in payment of the dividends which became due on that Dividend
Due Date.

          d. Dividend Arrearage. If a dividend upon any shares of Series II
             ------------------
Class B Preferred Stock is in arrears, all dividends or other distributions
declared upon shares of the Series II Class B Preferred Stock (other than
dividends paid in stock of the Corporation ranking junior to the Series II Class
B Preferred Stock as to dividends and upon liquidation, dissolution or winding
up) may only be declared pro rata. Except as set forth above, if a dividend upon
any shares of Series II Class B Preferred Stock is in arrears: (i) no dividends
(in cash, stock or other property) may be paid or declared and set aside for
payment or any other distribution made upon any stock of the Corporation ranking
junior to the Series II Class B Preferred Stock as to dividends (other than
dividends of distributions in stock of the Corporation ranking junior to the
Series II Class B Preferred Stock as to dividends and upon liquidation,
dissolution or winding up); and (ii) no stock of the Corporation ranking junior
to the Series II Class B Preferred Stock as to dividends may be (A) redeemed
pursuant to a sinking fund of otherwise, except (1) by means of redemption
pursuant to which all outstanding shares of the Series II Class B Preferred
Stock are redeemed, or (2) by conversion of any such junior stock into, or
exchange of any such junior stock into, or exchange of any such junior stock for
stock of the Corporation ranking junior to the Series II Class B Preferred Stock
as to dividends and upon liquidation, dissolution or winding up, or (B)
purchased or

                                        2

<PAGE>

otherwise acquired for any consideration by the Corporation except (1) pursuant
to an acquisition made pursuant to the terms of one or more offers to purchase
all of the outstanding shares of the Series II Class B Preferred Stock, which
offers shall each have been accepted by the holders of at least 50% of the
shares of the Series II Class B Preferred Stock receiving such offer outstanding
at the commencement of the first of such purchase offers, or (2) by conversion
into or exchange for stock of the Corporation ranking junior to the Series II
Class B Preferred Stock as to dividends and upon liquidation, dissolution or
winding up.

     3. General, Class and Series Voting Rights. Except as provided in this
        ---------------------------------------
Section 3 and in Section 4 hereof or as otherwise from time to time required by
law, the Series II Class B Preferred Stock shall have no voting rights.

     So long as any shares of Series II Class B Preferred Stock remain
outstanding, the consent of the holders of at least fifty-one (51%) percent of
the shares of Series II Class B Preferred Stock outstanding at the time voting
separately as a class, given in person or by proxy, either in writing at any
special or annual meeting called for the purpose, shall be necessary to permit,
effect or validate any one or more of the following:

        (i) The authorization, creation or issuance, or any increase in the
     authorized or issued amount, of any class or series of stock (including any
     class or series of Preferred Stock) ranking equal or prior (as the terms
     are hereinafter defined in this Section 3) to the Series II Class B
     Preferred Stock; or

        (ii) The amendment, alteration or repeal, whether by merger,
     consolidation or otherwise, of any of the provisions of the Articles of
     Incorporation or of this resolution which would alter or change the powers,
     preferences or special rights of the shares of the Series II Class B
     Preferred Stock so as to affect them adversely; provided, however, that any
     increase in the amount of authorized Preferred Stock, or the creation and
     issuance of other series of Preferred Stock ranking junior to the Series II
     Class B Preferred Stock with respect to the payment of dividends and the
     distribution of assets upon liquidation, dissolution or winding up, shall
     not be deemed to adversely affect such powers, preferences or special
     rights.

     The foregoing voting provisions shall not apply if, at or prior to the time
when the act with respect to which such vote would otherwise be required shall
be effected, all outstanding shares of Series II Class B Preferred Stock shall
have been redeemed or sufficient funds shall have been deposited in trust to
effect such redemption.

     4. Default Voting Rights. Whenever, at any time or times, dividends
        ---------------------
payable on the shares of Series II Class B Preferred Stock shall be in arrears
for twelve (12) consecutive quarterly dividend periods, the holders of a
majority of the outstanding shares of Series II Class B Preferred Stock shall
have the exclusive right (voting separately as a class) to elect one-third of
the Board of Directors of the Corporation at the Corporation's next annual

                                        3

<PAGE>

meeting of stockholders (to serve until the next annual meeting of shareholders,
and until their successors are duly elected and qualified) and at each
subsequent annual meeting of stockholders so long as such arrearage shall
continue, and the Common Stock voting separately as a class, shall be entitled
to elect the remainder of the Board of Directors of the Corporation. At
elections for such directors, each holder of Series II Class B Preferred Stock
shall be entitled to one vote for each share of Preferred Stock held. The right
of the holders of Series II Class B Preferred Stock, voting separately as a
class, to elect members of the Board of the Directors of the Corporation as
aforesaid shall continue until such time as all dividends accumulated on the
Series II Class B Preferred Stock shall have been paid in full, at which time
such right shall terminate, except as herein or by law expressly provided,
subject to revesting in the event of each and every subsequent default of the
character above mentioned.

     Directors elected by the holders of Series II Class B Preferred Stock shall
continue to serve as such directors until such time as all dividends accumulated
on the Series II Class B Preferred Stock shall have been paid in full, at which
time the term of office of all persons elected as directors by the holders of
shares of Series II Class B Preferred Stock shall forthwith terminate. In the
case of any vacancy in the office of a director occurring among the directors
elected by the holder of a class (with the Series II Class B Preferred Stock and
Common Stock being treated as separate classes) of stock, the remaining
directors so elected by that class may by affirmative vote of a majority thereof
(or the remaining director so elected if there be but one) elect a successor or
successors to hold office for the unexpired term of the director or directors
whose place or places shall be vacant. Any director who shall have been elected
by the holders of a class of stock or by an directors so elected as provided in
the next preceding sentence hereof may be removed during the aforesaid term of
office, either for or without cause, by, and only by, the affirmative vote of
the holders of a majority of the shares of the class of stock who elected such
director or directors, given either at a special meeting of such shareholders
duly called for that purpose or pursuant to a written consent of shareholders,
and any vacancy thereby created may be filled by the holders of that class of
stock represented at such meeting or pursuant to such written consent. Whenever
the term of office of the directors elected by the holders of Series II Class B
Preferred Stock voting as a class shall end and the special voting powers vested
in the holders of Series II Class B Preferred Stock voting as a class shall end
and the special voting powers vested in the holders of Series II Class B
Preferred Stock as provided in this Section 4 shall have expired, the number of
directors shall be such number as may be provided for in the Articles of
Incorporation or Bylaws irrespective of any increase made pursuant to the
provisions of this Section 4.

     5. Redemption. The outstanding shares of Series II Class B Preferred
        ----------
Stock shall be nonredeemable prior to the lapse of three (3) years from the date
of issuance. On and after such date, the Series II Class B Preferred Stock may
be redeemed at the option of the Corporation, as a whole at any time or in part
from time to time, at the Redemption Price of $15.00 per share plus all
dividends (whether or not declared or due) accrued and unpaid to the date of
redemption (subject to the right of the holder of record of shares of Series II
Class B Preferred Stock on a record date for the payment of a dividend on the
Series II Class B

                                        4

<PAGE>

Preferred Stock to receive the dividend due on such shares of Series II Class B
Preferred Stock on the corresponding Dividend Due Date.)

     No sinking fund shall be established for the Series II Class B Preferred
Stock.

     Notice of any proposed redemption of shares of Series II Class B Preferred
Stock shall be mailed by means of first class mail, postage paid, addressed to
the holders of record of the shares of Series II Class B Preferred Stock to be
redeemed, at their respective addresses then appearing on the books of the
Corporation, at least thirty (30) but not more than sixty (60) days prior to the
date fixed for such redemption (herein referred to as the "Redemption Date").
Each such notice shall specify (i) the Redemption Date; (ii) the Redemption
Price; (iii) the place for payment and for delivering the stock certificate(s)
and transfer instrument(s) in order to collect the Redemption Price; (iv) the
shares of Series II Class B Preferred Stock to be redeemed; and (v) the then
effective Conversion Price (as defined below) and that the right of holders of
shares of Series II Class B Preferred Stock being redeemed to exercise their
conversion right shall terminate as to such shares at the close of business on
the fifth day before the Redemption Date (provided that no default by the
Corporation in the payment of the applicable Redemption Price (including any
accrued and unpaid dividends) shall have occurred and be continuing). Any notice
mailed in such manner shall be conclusively deemed to have been duly given
whether or not such notice is in fact received. If less than all the outstanding
shares of Series II Class B Preferred Stock are to be redeemed, the Corporation
will select those to be redeemed by lot or by a substantially equivalent method.
In order to facilitate the redemption of Series II Class B Preferred Stock to be
redeemed, which shall not be more than sixty (60) days prior to the Redemption
Date with respect thereto.

     The holder of any shares of Series II Class B Preferred Stock redeemed upon
any exercise of the Corporation's redemption right shall not be entitled to
receive payment of the Redemption Price for such shares until such holder shall
cause to be delivered to the place specified in the notice given with respect to
such redemption (i) the certificate(s) representing such shares of Series II
Class B Preferred Stock; and (ii) transfer instrument(s) satisfactory to the
Corporation and sufficient to transfer such shares of Series II Class B
Preferred Stock to the Corporation free of any adverse interest. No interest
shall accrue on the Redemption Price of any share of Series II Class B Preferred
Stock after its Redemption Date.

     Subject to Section 2 hereof, the Corporation shall have the right to
purchase shares of Series II Class B Preferred Stock from the owner of such
shares on such terms as may be agreeable to such owner. Shares of Series II
Class B Preferred Stock may be acquired by the Corporation from any stockholder
pursuant to this paragraph without offering any other stockholder an equal
opportunity to sell his stock to the Corporation, and no purchase by the
Corporation from any stockholder pursuant to this paragraph shall be deemed to
create any right on the part of any stockholder to sell any shares of Series II
Class B Preferred Stock (or any other stock) to the Corporation.

                                        5

<PAGE>

     Notwithstanding the foregoing provisions of this Section 5, and subject to
the provisions of Section 2 hereof, if a dividend upon any shares of Series II
Class B Preferred Stock is past due, (i) no shares of the Series II Class B
Preferred Stock may be redeemed, except (A) by means of a redemption pursuant to
which all outstanding shares of the Series II Class B Preferred Stock are
simultaneously redeemed (or offered to be so redeemed) or pursuant to which the
outstanding shares of the Series II Class B Preferred Stock are redeemed on a
pro rata basis (or offered to be so redeemed), or (B) by conversion of shares of
Series II Class B Preferred Stock into, or exchange of such shares for, Common
Stock or any other stock of the Corporation ranking junior to the Series II
Class B Preferred Stock as to dividends and upon liquidation, dissolution or
winding up.

     6. Liquidation. In the event of any voluntary or involuntary
        -----------
dissolution, liquidation or winding up of the Corporation (for the purposes of
this Section 6, a "Liquidation"), before any distribution of assets shall be
made to the holders of the Common Stock or the holders of any other stock that
ranks junior to the Series II Class B Preferred Stock in respect of
distributions upon the Liquidation of the Corporation, the holder of each share
of Series II Class B Preferred Stock then outstanding shall be entitled to
$12.50 per share plus all dividends (whether or not declared or due) accrued and
unpaid on such share on the date fixed for the distribution of assets of the
Corporation to the holders of Series II Class B Preferred Stock.

     If upon any Liquidation of the Corporation, the assets available for
distribution to the holder of Series II Class B Preferred Stock which shall then
be outstanding (hereinafter in this paragraph called the "Total Amount
Available") shall be insufficient to pay the holders of all outstanding shares
of Series II Class B Preferred Stock the full amounts (including all dividends
accrued and unpaid) to which they shall be entitled by reason of such
Liquidation of the Corporation, then there shall be paid ratably to the holders
of the Series II Class B Preferred Stock in connection with such Liquidation of
the Corporation, an amount equal to each holder's pro rata share of the Total
Amount Available.

     The voluntary sale, conveyance, lease, exchange or transfer of all or
substantially all the property or assets of the Corporation, or the merger or
consolidation of the Corporation into the Corporation, or any purchase or
redemption of some or all of the shares of any class or series of stock of the
Corporation, shall not be deemed to be a Liquidation of the corporation for the
purposes of this Section 6 (unless in connection therewith the Liquidation of
the Corporation is specifically approved).

     7. Conversion Privilege. At any time subsequent to three years after
        --------------------
issuance of any share of Series II Class B Preferred Stock, the holder of any
share of Series II Class B Preferred Stock ("Holder") shall have the right, at
such Holder's option (but if such share is called for redemption or exchange at
the election of the Corporation, then in respect of such share only to and
including but not after the close of business on (i) the fifth calendar day
before the date fixed for such redemption; or (ii) the date fixed for such
exchange, provided

                                        6

<PAGE>

that the Corporation has set aside funds sufficient to effect such redemption to
convert such share into that number of fully paid and non-assessable shares of
Common Stock (calculated as to each conversion to the nearest 1/100th of a
share) obtained by dividing $10.00 by the Conversion Rate then in effect.

          a. Conversion Rate. Each share of Series II Class B Preferred Stock
             ---------------
     may be converted, subject to the terms and provisions of this paragraph 2
     into one (1) share of the Corporation's Common Stock, which is a price
     equal to one share of Common Stock for each $10.00 of Series II Class B
     Preferred Stock or, in case an adjustment of such rate has taken place
     pursuant to the provisions of subdivision (f.) of this paragraph (7), then
     at the Conversion Rate as last adjusted (such rate or adjusted rate, shall
     be expressed as the number of shares of Common Stock to be acquired upon
     conversion of one share of Series II Class B Preferred Stock, and shall be
     referred to herein as the "Conversion Rate"). Each share of Series II Class
     B Preferred Stock shall be Convertible into Common Stock by surrender to
     the corporation of the certificate representing such shares of Series II
     Class B Preferred Stock to be converted by the Holder and by giving written
     notice to the Corporation of the Holder's election to convert.

          The Corporation shall, as soon as practicable after receipt of such
     written notice and the proper surrender to the Corporation of the
     certificate or certificates representing shares of Series II Class B
     Preferred Stock to be converted in accordance with the above provisions,
     issue and deliver for the benefit of the Holder at the office of the
     Corporation's duly appointed transfer agent (the "Transfer Agent") to the
     Holder for whose account such shares of Series II Class B Preferred Stock
     were so surrendered or to such Holder's nominee or nominees, certificates
     for the number of shares of Common Stock to which the Holder shall be
     entitled. The certificates of Common Stock of the Corporation issued upon
     conversion shall bear such legends as may be required by state or federal
     laws. Such conversion shall be deemed to have been effective immediately
     prior to the close of business on the date on which the Corporation shall
     have received both such written notice and the properly surrendered
     certificates for shares of Series II Class B Preferred Stock to be
     converted (the "Conversion Date"), and at such time the rights of the
     Holder shall cease and the person or persons entitled to receive the shares
     of Common Stock issuable upon the conversion of such shares of Series II
     Class B Preferred Stock shall be deemed to be, and shall be treated for all
     purposes as, the record Holder or Holders of such Common Stock on the
     Conversion Date. The Corporation shall not be required to convert, and no
     surrender of shares of Series II Class B Preferred Stock or written notice
     of conversion with respect thereto shall be effected for that purpose,
     while the stock transfer books of the Corporation are closed for any
     reasonable business purpose for any reasonable period of time, but the
     proper surrender of shares of Series II Class B Preferred Stock for
     conversion immediately upon the reopening of such books. During the period
     in which the stock transfer books of the Corporation are closed, the

                                        7

<PAGE>

     Corporation may neither declare a dividend, declare a record date for
     payment of dividends nor make any payment of dividends.

          b. Dividends. If any shares of Class B Preferred Stock shall be
             ---------
     converted during any dividend payment period, the Holder shall be entitled
     to all dividends accrued up to and through such Conversion Date, at the
     rate set forth herein, whether or not there has been a dividend date, as
     set forth in paragraph 2 hereof.

          c. Cancellation. Class B Preferred Stock converted into Common
             ------------
     Stock pursuant to the provisions of this paragraph (7) shall be retired and
     cancelled by the Corporation and given the status of authorized and
     unissued preferred stock.

          d. Reissuance if Conversion is Partial. In the case of any
             -----------------------------------
     certificate representing shares of Series II Class B Preferred Stock which
     is surrendered for conversion only in part, the Corporation shall issue and
     deliver to the Holder a new certificate or certificates for Series II Class
     B Preferred Stock of such denominations as requested by the Holder in the
     amount of Series II Class B Preferred Stock equal to the unconverted shares
     of the Series II Class B Preferred Stock represented by the certificate so
     surrendered.

          e. Reservations of Shares. The Corporation shall at all times
             ----------------------
     during which shares of Series II Class B Preferred Stock may be converted
     into Common Stock as provided in this paragraph (e), reserve and keep
     available, out of any Common Stock held as treasury stock or out of its
     authorized and unissued Common Stock, or both, solely for the purpose of
     delivery upon conversion of the shares of Series II Class B Preferred Stock
     as herein provided, such number of shares of Common Stock as shall then be
     sufficient to effect the conversion of all shares of Series II Class B
     Preferred Stock from time to time outstanding, and shall take such action
     as may from time to time be necessary to ensure that such shares of Common
     Stock will, when issued upon conversion of Series II Class B Preferred
     Stock, be fully paid and nonassessable.

          f. Adjustment of Conversion Rate. The Conversion Rate provided in
             -----------------------------
     subdivision (a) of this paragraph (7), in respect of Class B Preferred
     Stock, shall be subject to adjustments from time to time as follows:

            (i) While any shares of Series II Class B Preferred Stock shall be
          outstanding, in case the Corporation shall subdivide the outstanding
          shares of Common Stock into a greater number of shares of Common Stock
          or combine the outstanding shares of Common Stock into a smaller
          number of shares of Common Stock, or issue, by reclassification of its
          shares of Common Stock any shares of the Corporation, the Conversion
          Rate in effect immediately prior thereto shall be adjusted so that the
          Holder shall be entitled to receive the number of shares which it
          would have owned or been entitled to receive after

                                        8

<PAGE>

          the happening of any of the events described above, had such shares of
          Series II Class B Preferred Stock been converted immediately prior to
          the happening of such event, such adjustment to become effective
          immediately after the opening of business on the day following the day
          upon which such subdivision or combination or reclassification, as the
          case may be, becomes effective.

            (ii) In case the Corporation shall be consolidated with, or merge
          into, any other corporation, and the Corporation does not survive,
          proper provisions shall be made as a part of the terms of such
          consolidation or merger, whereby the Holder shall thereafter be
          entitled, upon exercise of such Holder's conversion rights, to receive
          the kind and amount of shares of stock or other securities of the
          Corporation resulting from such consolidation or merger, or such other
          property, as the Holder would have received if such conversion rights
          were exercised immediately prior to the effectiveness of such merger
          of consolidation.

            (iii) In the event the Corporation at any time, or from time to time
          after June 15, 1997 makes or issues, or fixes a record date for the
          determination of holders of Common Stock entitled to receive, a
          dividend or other distribution payable in additional shares of Common
          Stock or Common Stock Equivalents (as defined herein) which does not
          provide for the payment of any consideration upon the issuance,
          conversion or exercise thereof, without a corresponding dividend or
          other distribution to the Holder, based upon the number of shares of
          Common Stock into which the Series II Class B Preferred Stock is
          convertible, then and in each such event the Conversion Rate then in
          effect will be increased as of the time of such issuance or, in the
          event such a record date shall have been fixed, as of the close of
          business on such record date, by multiplying such Conversion Rate by a
          fraction:

                  (A) The numerator of which will be the total number of shares
            of Common Stock issues and outstanding immediately prior to the time
            of such issuance or the close of business on such record date plus
            the number of shares of Common Stock issuable in payment of such
            dividend or distribution (which, in the case of Common Stock
            Equivalents, shall mean the maximum number of shares of Common Stock
            issuable with respect thereto, as set forth in the instrument
            relative thereto without regard to any provision for subsequent
            adjustment); and

                  (B) The denominator of which will be the total number of
            shares of Common Stock issued and outstanding immediately prior to
            the time of such issuance or the close of business on such record
            date;

                                        9

<PAGE>

            provided, however, that if such record date is fixed and such
            dividend is not fully paid or if such distribution is not fully made
            on the date fixed therefor, the Conversion Rate will be recomputed
            accordingly as of the close of business on such record date, and
            thereafter such Conversion Rate will be adjusted pursuant to this
            subparagraph (iii) as of the time of actual payment of such
            dividends or distributions.

               (iv) In the event the Corporation at any time or from time to
            time after June 15, 1997 makes or issues, or fixes a record date for
            the determination of holders of Common Stock entitled to receive a
            dividend or other distribution payable to all holders of Common
            Stock in securities of the Corporation or Common Stock Equivalents,
            then, upon making such dividend or distribution provisions will be
            made so that the Holder will receive the amount of securities of the
            Corporation which it would have received had its Series II Class B
            Preferred Stock been converted into Common Stock on the date of such
            event.

               (v) In the event the Corporation sells or issues any Common
            Stock, or sells or issues Common Stock Equivalents which can be
            converted into Common Stock at a per share consideration (as defined
            below in this subparagraph (v) of paragraph 7(f) less than the
            Stipulated Price then in effect, then the Holder shall be entitled
            to purchase from the Corporation in cash (for the same per share
            consideration at which such Common Stock was issued or the per share
            price at which a share of Common Stock is acquirable upon exercise
            or conversion of Common Stock Equivalents) that additional number of
            shares of Common Stock which, when added to the number of shares of
            Common Stock acquirable by the Holder upon conversion of any shares
            of Series II Class B Preferred Stock outstanding and held by such
            Holder immediately before such issue or sale (the "Acquirable
            Shares"), will equal a percentage of the number of shares of Common
            Stock Deemed Outstanding (as defined herein) immediately after such
            sale or issuance that is the same as the percentage of the number of
            shares of Common Stock Deemed Outstanding immediately before such
            issuance or sale represented by the Acquirable Shares. This right
            shall exist for a forty-five-day period following the sale or
            issuance of shares of Common Stock or Common Stock Equivalents, and
            thereafter shall cease to exist.

               For the above purposes, the per share consideration with respect
            to the sale or issuance of Common Stock will be the price per share
            received by the Corporation, prior to the payment of any expenses,
            commissions, discounts and other applicable costs. With respect to
            the sale or issuance of Common Stock Equivalents which are
            convertible into or exchangeable for Common Stock without further
            consideration, the per share consideration will be determined by
            dividing the maximum number of shares of Common Stock issuable with
            respect

                                       10

<PAGE>

            to such Common Stock Equivalents (as set forth in the instrument
            relating thereto without regard to any provisions contained therein
            for subsequent adjustment of such number) into the aggregate
            consideration receivable by the Corporation upon the sale or
            issuance of such Common Stock Equivalents. With respect to the
            issuance of other Common Stock Equivalents, the per share
            consideration will be determined by dividing the maximum number of
            shares of Common Stock issuable with respect to such Common Stock
            Equivalents into the total aggregate consideration received by the
            Corporation upon the sale or issuance of such Common Stock
            Equivalents plus the minimum aggregate amount of additional
            consideration received by the Corporation upon the conversion or
            exercise of such Common Stock Equivalents. In connection with the
            sale or issuance of Common Stock and/or Common Stock Equivalents for
            non-cash consideration, the amount of consideration will be the fair
            market value of such consideration as determined in good faith by
            the Board of Directors of the Corporation.

               (vi) As used herein, the term "Stipulated Price" means initial
            price of $10.00 per share of Common Stock, as adjusted from time to
            time pursuant to subparagraph (viii) of this paragraph 7(f); and the
            term "Common Stock Equivalent" means any securities (whether debt or
            equity securities) or rights issued by the Corporation convertible
            into or entitling the holder thereof to receive shares of, or
            securities convertible into, Common Stock. The number of shares of
            "Common Stock Deemed Outstanding" at any date shall equal the sum of
            the number of shares of Common Stock then outstanding plus the
            number of shares of Common Stock then obtainable pursuant to Common
            Stock Equivalents.

               (vii) In the event the Corporation declares any dividend or
            distribution payable to holders of its Common Stock (other than
            dividends payable out of the Corporation's retained earnings or
            earned surplus and dividends payable in shares of Common Stock or in
            securities convertible into or exchangeable for shares of Common
            Stock or rights or warrants to purchase Common Stock or securities
            convertible into or exchangeable for shares of Common Stock or any
            other securities issued by the Corporation), the Conversion Rate in
            effect immediately prior to the record date for such dividend or
            distribution shall be proportionately adjusted so that the Holder
            shall be entitled to receive the number of shares of Common Stock
            into which such shares of Common Stock or Preferred Stock was
            convertible immediately prior to such record date multiplied by a
            fraction, the numerator of which is the fair market value of a share
            of Common Stock on such record date and the denominator of which is
            such per share fair market value of a share of Common Stock on such
            record date less the fair market value on such record date of the
            securities or other property which are distributed as a dividend or
            other distribution. The term

                                       11

<PAGE>

            "fair market value" of a share of Common Stock or of any other
            security or other type of property on any date means (A) in the case
            of Common Stock or any other security (I) if the principal trading
            market for such Common Stock or other security is an exchange or the
            NASDAQ national market on such date, the closing price on such
            exchange or the NASDAQ national market on such date, provided, if
            trading of such Common Stock or other security is listed on any
            consolidated tape, the fair market value shall be the closing price
            set forth on such consolidated tape on such date, or (II) if the
            principal market for such Common Stock or other security is the
            over-the-counter market (other than the NASDAQ national market) the
            mean between the closing bid and asked prices on such date as set
            forth by NASDAQ or (B) in the case of Common Stock or any other
            security for which the fair market value cannot be determined
            pursuant to clause (A) above or of any other security or type of
            property, fair market value thereof on such date as determined in
            good faith by the Board of Directors.

               (viii) Whenever the Conversion Rate is adjusted pursuant to this
            paragraph (7)(f), the Stipulated Price shall also be adjusted by
            multiplying it by a fraction that is the reciprocal of the fraction
            used to adjust the Conversion Rate.

               (ix)   The Corporation will not, by amendment of its Articles of
            Incorporation or through any dissolution, issuance or sale of
            securities or any other voluntary action, avoid or seek to avoid the
            observance or performance of any of the terms to be observed or
            performed hereunder by the Corporation, but at all times in good
            faith will assist in the carrying out of all the provisions of this
            paragraph and in the taking of all such action as may be necessary
            or appropriate in order to protect the conversion rights of the
            Holder against impairment.

               (x)    No adjustment in the Conversion Rate shall be required,
            unless such adjustment would require an increase or decrease of at
            least one (1) share of Common Stock in the Conversion Rate of one
            share of Series II Class B Preferred Stock, provided that all
            adjustments which do not meet this minimum requirement shall be
            cumulated and the adjustment will be made when the cumulated total
            is sufficient to require an adjustment. All calculations made
            pursuant to this subparagraph (x) of paragraph (7)(f) shall be made
            to the nearest one-hundredth (1/100th) of a share of Common Stock.

     g. Fractional Shares. No fractional shares of Common Stock or scrip
        -----------------
representing fractional shares of Common Stock shall be issued upon any
conversion of shares of Series II Class B Preferred Stock but, in lieu thereof,
there shall be paid an amount in cash equal to the same fraction of the current
market price of a whole share of Common Stock on the day

                                       12

<PAGE>

preceding the day of conversion.

     h. Statement to Transfer Agent. Whenever the Conversion Rate for shares
        ---------------------------
of Series II Class B Preferred Stock shall be adjusted pursuant to the
provisions of paragraph (7)(f) hereof, the Corporation shall forthwith maintain
at its office and, if applicable, file with the Transfer Agent for shares of
Series II Class B Preferred Stock and for shares of Common Stock, a statement
signed by the President or a Vice President of the Corporation and by its
Treasurer or an Assistant Treasurer, stating the adjusted Conversion Rate and
setting forth in reasonable detail the method of calculation and the facts
requiring such adjustment, such calculations to be confirmed by the
Corporation's independent auditors, and stating the faces on which the
calculation is based. Each adjustment shall remain in effect until a subsequent
adjustment hereunder is required.

     8. Registration Rights.
        -------------------

        a. Piggyback Registration. The Corporation, for a period ending six
           ----------------------
months after the last share of Series II Class B Preferred Stock is redeemed,
retired, converted or otherwise no longer outstanding, will give written notice
to the Holder not less than 20 days in advance of the initial filing of any
registration statement under the Securities Act of 1933 (other than a
registration Statement pertaining to securities issuable pursuant to employee
stock option, stock purchase, or similar plans or a registration statement
pertaining to securities issuable in connection with the acquisition of a
business, whether through merger, consolidation, acquisition of assets, or
exchange of securities) covering any Common Stock or other securities of the
Corporation, and will afford the Holder the opportunity to have included in such
registration all or such part of the shares of Common Stock acquired upon
conversion of Series II Class B Preferred Stock, as may be designated by written
notice to the Corporation not later than 10 days following receipt of such
notice from the Corporation. The Corporation shall be entitled to exclude the
shares of Common Stock held by the Holder from any one, but not more than one,
such registration if the Corporation is advised by its investment banking firm
that the inclusion of such shares will, in the opinion of such investment
banking firm, materially interfere with the orderly sale and distribution of the
securities being offered under such registration statement by the Corporation.
Notwithstanding the foregoing, the Corporation shall not be entitled to exclude
the shares of Common Stock held by the Holder if shares of other shareholders
are being included in any such registration statement and, in such
circumstances, the Holder shall be entitled to include the shares of Common
Stock held by them on a pro rata basis in the proportion that the number of
shares of Common Stock held by the Holder bears to the shares of Common Stock
held by all other shareholders, including shares in such registration statement.
The Holder shall not be entitled to include shares in more than two registration
statement pursuant to the provisions of this subdivision a of paragraph (8), and
all rights of the Holder under this subdivision a of paragraph (8) shall
terminate after the Holder has included shares of Common Stock in two
registration statements pursuant to this subdivision a of paragraph (8).

                                       13

<PAGE>

     b. Expenses. The Corporation will pay all out-of-pocket costs and
        --------
expenses of any registration effected pursuant to the provisions of subdivision
(a) of this paragraph 8, including registration fees, legal fees, accounting
fees, printing expenses (including such number of any preliminary and the final
prospectus as may be reasonably requested), blue sky qualification fees and
expenses, and all other expenses, except for underwriting commissions or
discounts applicable to the shares of Common Stock being sold by the Holder and
the fees of counsel for the Holder, all of which shall be paid by the Holder.

     c. Notwithstanding anything to the contrary contained herein, in the event
that the Corporation files an initial registration statement under the
Securities Act of 1933, as amended (other than a registration statement
pertaining to securities issuable in connection with the acquisition of a
business, whether through merger, consolidation, acquisition of assets or
exchange of securities) concerning any Common Stock of the Corporation, it will
afford the Holder the opportunity to convert his shares into that number of
fully paid and non-assessable shares of Common Stock prior to the three year
holding period stated in paragraph 7 above. The Corporation may also, at its
option, accelerate its redemption rights pursuant to paragraph 4 above in the
event that the Corporation files an initial registration statement under the
Securities Act of 1933, as amended.

     9. Reports.
        -------

     So long as any of the Series II Class B Preferred Stock shall be
outstanding, the Corporation shall submit to the Holder financial reports no
less frequently than annually.

     10. Miscellaneous.
         -------------

         a. As used herein, the term "Common Stock" shall mean the
Corporation's Common Stock, no par value, or, in the case of any
reclassification or change of outstanding shares of Common Stock, the stock or
securities issued in exchange for such Common Stock. The term "Common Stock"
shall also include any capital stock of the Corporation authorized after June
15, 1995 which shall not be limited to a fixed sum or sums or percentage or
percentages of par value in respect of the rights of the holders thereof to
participate in dividends or in the distribution of assets upon the voluntary or
involuntary liquidation, dissolution or winding up of the Corporation.

         b. The shares of Series II Class B Preferred Stock shall be fully
transferable by the Holder thereof, subject to compliance with the applicable
provisions of federal and state securities laws.

                                       14

<PAGE>

     IN WITNESS WHEREOF, RETRACTABLE TECHNOLOGIES, INC. has caused its corporate
seal to be hereunto affixed and this Certificate to be signed by its President
and Secretary this 10th day of May, 1997.



                                        /s/ Thomas J. Shaw
                                        ----------------------------------------
                                        President

ATTEST:

/s/ Shayne Blythe
----------------------------
Secretary

                                       15

<PAGE>

                                                                       EXHIBIT D

                                                                FILED
                                                         In the Office of the
                                                     Secretary of State of Texas
                                                             JUL 29 1998
                                                        Corporations Section


        CERTIFICATE OF DESIGNATION, PREFERENCES, RIGHTS AND LIMITATIONS
             OF THE SERIES III CLASS B CONVERTIBLE PREFERRED STOCK
                                       OF
                         RETRACTABLE TECHNOLOGIES, INC.

Pursuant to the Article 2.13 of the Texas Business Corporation Act and Article
Four of its Articles of Incorporation, Retractable Technologies, Inc., a
corporation organized and existing under the laws of the State of Texas (the
Corporation),

DOES HEREBY CERTIFY that pursuant to the authority conferred upon the Board of
Directors of the Corporation by the Articles of Incorporation, as amended, and
pursuant to the Texas Business Corporation Act, said Board of Directors, by
unanimous written consent executed July 2, 1998, adopted a resolution providing
for the creation of a series of Preferred Stock consisting of not more than two
million (2,000,000) shares of Series III Class B Convertible Preferred Stock,
which resolution is and reads as follows:

RESOLVED that, pursuant to the authority provided in the Corporation's Articles
of Incorporation and expressly granted to and vested in the Board of Directors
of Retractable Technologies, Inc. (the "Corporation"), the Board of Directors
hereby creates out of the Preferred Stock, par value one ($1.00) dollar per
share, of the Corporation a series of Preferred Stock called the Series III
Class B Preferred Stock, consisting of not more than two million (2,000,000)
shares, and the Board of Directors hereby fixes the designation and the powers,
preference and rights, and the qualifications, limitations and restrictions
thereof, to the extent not otherwise provided in the Corporation's
qualifications, limitations and restrictions thereof, to the extent not
otherwise provided in the Corporation's Articles of Incorporation, as follows:

1.   Designation of series. The designation of the series of Preferred Stock
     created by this resolution shall be "Series III Class B Convertible
     Preferred Stock" (the "Series III Class B Preferred Stock").

2.   Dividends on Series III Class B Preferred Stock.

     a.   Dividend Amount. The holders of the Series III Class B Preferred Stock
          shall be entitled to receive, in any calendar year, if when and as
          declared by the Board of Directors, out of any assets at the time
          legally available therefor and subject to the further limitations set
          out herein, dividends at the per annum rate of $1.00 per share, all
          such dividends due quarterly in arrears as of the last day of each
          March, June, September and December of each year, the first dividend
          being declarable on December 31, 1998. On each date which a dividend
          may be declared is hereafter called the "Dividend Date," and each
          quarterly period ending with a Dividend Date is hereinafter referred
          to as the "Dividend Period." Dividends shall be payable fifteen
          calendar days after the Dividend Due Date, provided however, that
          if such date on which a dividend is payable is a Saturday, Sunday or
          legal holiday, such dividend shall be payable on the next following
          business day to the holders of record (whether singular or plural, the
          "Holder").

     b.   Dividends Cumulative. Dividends upon the Series III Class B Preferred
          Stock shall be accrued and be cumulative, whether or not in any
          Dividend Period or Periods there shall be funds of the Corporation
          legally available for the payment of such dividends.

     c.   Dividend Accrual. On each Dividend Due Date all dividends which shall
          have accrued since the last Dividend Due Date on each share of Series
          III Class B Preferred Stock outstanding on such Dividend Due Date
          shall accumulate and be deemed to become "due." Any dividend which
          shall not be paid on the Dividend Due Date on which it shall become
          due shall be deemed to be "past due" until such dividend shall be paid
          or until the share of Series III Class B Preferred Stock with respect
          to which such dividend became due shall no longer be outstanding,
          whichever is the earlier to occur. No interest, sum of money in lieu
          of interest or other property or securities shall be payable in
          respect of any dividend payment or payments which are past due.
          Dividends paid on shares of Series III Class B Preferred Stock in an
          amount less that the total amount of such dividends at the time
          accumulated and payable on such shares shall be allocated pro rata on
          a share-by-share basis among all such shares

PRIVATE PLACEMENT MEMORANDUM
------------------------------
RETRACTABLE TECHNOLOGIES, INC.
--------------------------------
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<PAGE>

          at the time outstanding. Dividend payments made with respect to a
          Dividend Due Date shall be deemed to be made in payment of the
          dividends which became due on that Dividend Due Date.

     d.   Dividend Arrearage. If a dividend upon any shares of Series III Class
          B Preferred Stock is in arrears, all dividends or other distributions
          declared upon shares of the Series III Class B Preferred Stock (other
          than dividends paid in stock of the Corporation ranking junior to the
          Series III Class B Preferred Stock as to dividends and upon
          liquidation, dissolution or winding up) may only be declared pro rata.
          Except as set forth above, if a dividend upon any shares of Series III
          Class B Preferred Stock is in arrears: (i) no dividends (in cash,
          stock or other property) may be paid or declared and set aside for
          payment or any other distribution made upon any stock of the
          Corporation ranking junior to the Series III Class B Preferred Stock
          as to dividends (other than dividends of distributions in stock of the
          Corporation ranking junior to the Series III Class B Preferred Stock
          as to dividends and upon liquidation, dissolution or winding up); and
          (ii) no stock of the Corporation ranking junior to the Series III
          Class B Preferred Stock as to dividends may be (A) redeemed pursuant
          to a sinking fund or otherwise, except (1) by means of redemption
          pursuant to which all outstanding shares of the Series III Class B
          Preferred Stock are redeemed, or (2) by conversion of any such junior
          stock into, or exchange of any such junior stock into, or exchange of
          any such junior stock for stock of the Corporation ranking junior to
          the Series III Class B Preferred Stock as to dividends and upon
          liquidation, dissolution or winding up, or (B) purchased or otherwise
          acquired for any consideration by the Corporation except (1) pursuant
          to an acquisition made pursuant to the terms of one or more offers to
          purchase all of the outstanding shares of the Series III Class B
          Preferred Stock, which offers shall each have been accepted by the
          holders of at least 50% of the shares of the Series III Class B
          Preferred Stock receiving such offer outstanding at the commencement
          of the first of such purchase offers, or (2) by conversion into or
          exchange for stock of the Corporation ranking junior to the Series III
          Class B Preferred Stock as to dividends and upon liquidation or
          winding up.

3.   General, Class and Series Voting Rights. Except as provided in this Section
     3, or as otherwise from time to time required by law, the Series III Class
     B Preferred Stock shall have no voting rights.

     So long as any shares of Series III Class B Preferred Stock remain
     outstanding, the consent of the holders of at least fifty-one (51%) percent
     of the shares of Series III Class B Preferred Stock outstanding at the time
     voting separately as a class, given in person or by proxy, either in
     writing at any special or annual meeting called for the purpose, shall be
     necessary to permit, effect or validate any one or more of the following:

     (i)  The authorization, creation or issuance, or any increase in the
          authorized or issued amount, of any class or series of stock
          (including any class or series of Preferred Stock) ranking equal or
          prior (as the terms are hereinafter defined in this Section 3) to the
          Series III Class B Preferred Stock; or

     (ii) The amendment, alteration, or repeal, whether by merger, consolidation
          or otherwise, of any of the provisions of the Articles of
          Incorporation or of this resolution which would alter or change the
          powers, preferences or special rights of the shares of the Series III
          Class B Preferred Stock so as to affect them adversely; provided,
          however, that any increase in the amount of authorized Preferred
          Stock, or the creation and issuance of other series of Preferred stock
          ranking junior to the Series III Class B Preferred Stock with respect
          to the payment of dividends and the distribution of assets upon
          liquidation, dissolution or winding up, shall not be deemed to
          adversely affect such powers, preferences or special rights.

     The foregoing voting provisions shall not apply if, at or prior to the time
     when the act with respect to which such vote would otherwise be required
     shall be effected, all outstanding shares of Series III Class B Preferred
     Stock shall have been redeemed or sufficient funds shall have been
     deposited in trust to effect such redemption.

4.   Redemption. The outstanding shares of Series III Class B Preferred Stock
     shall be nonredeemable prior to the lapse of three (3) years from the date
     of issuance. On and after such date, the Series III Class B Preferred Stock
     may be redeemed at the option of the Corporation, as a whole at any time or
     in part from time to time, at the Redemption Price of $15.00 per share plus
     all dividends (whether or not declared or due) accrued and unpaid to the
     date of redemption

PRIVATE PLACEMENT MEMORANDUM
------------------------------
RETRACTABLE TECHNOLOGIES, INC.
--------------------------------
RTIPVTPL. July 10, 1998                     64

<PAGE>

     (subject to the right of the holder of record of shares of Series III Class
     B Preferred Stock on a record date for the payment of a dividend on the
     Series III Class B Preferred Stock to receive the dividend due on such
     shares of Series III Class B Preferred Stock on the corresponding Dividend
     Due Date).

     No sinking fund shall be established for the Series III Class B Preferred
     Stock.

     Notice of any proposed redemption of shares of Series III Class B Preferred
     Stock shall be mailed by means of first class mail, postage paid, addressed
     to the holders of record of the shares of Series III Class B Preferred
     Stock to be redeemed, at their respective addresses then appearing on the
     books of the Corporation, at least thirty (30) days but not more than sixty
     (60) days prior to the date fixed for such redemption (herein referred to
     as the "Redemption Date"). Each such notice shall specify (i) the
     Redemption Date; (ii) the Redemption Price; (iii) the place for payment and
     for delivering the stock certificate(s) and transfer instrument(s) in order
     to collect the Redemption Price; (iv) the shares of Series III Class B
     Preferred Stock to be redeemed; and (v) the then effective Conversion Price
     (as defined below) and that the right of holders of shares of Series III
     Class B Preferred Stock being redeemed to exercise their Conversion right
     shall terminate as to such shares at the close of business on the fifth day
     before the Redemption Date, provided that no default by the Corporation in
     the payment of the applicable Redemption Price (including any accrued and
     unpaid dividends) shall have occurred and be continuing. Any notice mailed
     in such manner shall be conclusively deemed to have been duly given whether
     or not such notice is, in fact, received. If less than all the outstanding
     shares of Series III Class B Preferred Stock are to be redeemed, the
     Corporation will select those to be redeemed by lot or by a substantially
     equivalent method. In order to facilitate the redemption of Series III
     Class B Preferred Stock to be redeemed, notice of any such proposed
     redemption, shall not be more than sixty (60) days prior to the Redemption
     Date with respect thereto.

     The holder of any shares of Series III Class B Preferred Stock redeemed
     upon any exercise of the Corporation's redemption right shall not be
     entitled to receive payment of the Redemption Price for such shares until
     such holder shall cause to be delivered to the place specified in the
     notice given with respect to such redemption (i) the certificate(s)
     representing such shares of Series III Class B Preferred Stock; and (ii)
     transfer instrument(s) satisfactory to the Corporation and sufficient to
     transfer such shares free of any adverse interest. No interest shall accrue
     on the Redemption Price of any share of Series III Class B Preferred Stock
     after its Redemption Date.

     Subject to Section 2 hereof, the Corporation shall have the right to
     purchase shares of Series III Class B Preferred Stock from the owner of
     such shares on such terms as may be agreeable to such owner. Shares of
     Series III Class B Preferred Stock may be acquired by the Corporation from
     any stockholder pursuant to this paragraph without offering any other
     stockholder an equal opportunity to sell his stock to the Corporation, and
     no purchase by the Corporation from any stockholder pursuant to this
     paragraph shall be deemed to create any right on the part of any
     stockholder to sell any shares of Series III Class B Preferred Stock (or
     any other stock) to the Corporation.

     Notwithstanding the foregoing provisions of this Section 4, and subject to
     the provisions of Section 2 hereof, if a dividend upon any shares of Series
     III Class B Preferred Stock is past due, (i) no shares of the Series III
     Class B Preferred Stock may be redeemed, except (A) by means of a
     redemption pursuant to which all outstanding shares of the Series III Class
     B Preferred Stock are simultaneously redeemed (or offered to be so
     redeemed) or pursuant to which the outstanding shares of the Series III
     Class B Preferred Stock are redeemed on a pro rata basis (or offered to be
     so redeemed), or (B) by conversion of shares of Series III Class B
     Preferred Stock into, or exchange of such shares for, Common Stock or any
     other stock of the Corporation ranking junior to the Series III Class B
     Preferred Stock as to dividends and upon liquidation, dissolution or
     winding up.

5.   Liquidation. In the event of any voluntary or involuntary dissolution,
     liquidation or winding up of the Corporation (for the purposes of this
     Section 5, a "Liquidation"), before any distribution of assets shall be
     made to the holders of the Common Stock or the holders of any other stock
     that ranks junior to the Series III Class B Preferred Stock in respect
     of distributions upon the Liquidation of the Corporation, the holder of
     each share of Series III Class B Preferred Stock then outstanding shall be
     entitled to $12.50 per share plus all dividends (whether or not declared or
     due) accrued

PRIVATE PLACEMENT MEMORANDUM
------------------------------
RETRACTABLE TECHNOLOGIES, INC.
--------------------------------
RTIPVTPL. July 10, 1998                   65

<PAGE>

     and unpaid on such share on the date fixed for the distribution of assets
     of the Corporation to the holders of Series III Class B Preferred Stock.

     If upon any Liquidation of the Corporation, the assets available for
     distribution to the holder of Series III Class B Preferred Stock which
     shall then be outstanding (hereinafter in this paragraph called the "Total
     Amount Available") shall be insufficient to pay the holders of all
     outstanding shares of Series III Class B Preferred Stock the full amounts
     (including all dividends accrued and unpaid) to which they shall be
     entitled by reason of such Liquidation of the Corporation, then there shall
     be paid ratably to the holders of the Series III Class B Preferred Stock in
     connection with such Liquidation of the Corporation, an amount equal to
     each holder's pro rata share of the Total Amount Available.

     The voluntary sale, conveyance, lease, exchange or transfer of all or
     substantially all the property or assets of the Corporation, or the merger
     or consolidation of the Corporation into another Corporation, or any
     purchase or redemption of some or all of the shares of any class or series
     of stock of the Corporation, shall not be deemed to be a Liquidation of the
     Corporation for the purposes of this Section 6 (unless in connection
     therewith the Liquidation of the Corporation is specifically approved).

6.   Conversion Privilege. At any time subsequent to three years after issuance
     of any share of Series III Class B Preferred Stock, the holder of any share
     of Series III Class B Preferred Stock ("Holder") shall have the right, at
     such Holder's option (but if such share is called for redemption or
     exchange at the election of the Corporation, then in respect of such share
     only to and including but not after the close of business on (i) the fifth
     calendar day before the date fixed for such redemption; or (ii) the date
     fixed for such exchange, provided that the Corporation has set aside funds
     sufficient to effect such redemption) to convert such share into that
     number of fully paid and non-assessable shares of Common Stock (calculated
     as to each conversion to the nearest 1/100th of a share) obtained by
     dividing $10.00 by the Conversion Rate then in effect.

     a.   Conversion Rate. Each share of Series III Class B Preferred Stock may
          be converted, subject to the terms and provisions of this paragraph 6
          into one (1) share of the Corporation's Common Stock, which is a price
          equal to one share of Common Stock for each $10.00 of Series III Class
          B Preferred Stock or, in case an adjustment of such rate has taken
          place pursuant to the provisions of subdivision (f) of this paragraph
          6, then at the Conversion Rate as last adjusted (such rate or adjusted
          rate, shall be expressed as the number of shares of Common Stock to be
          acquired upon conversion of one share of Series III Class B Preferred
          Stock, and shall be referred to herein as the "Conversion Rate"). Each
          share of Series III Class B Preferred Stock shall be Convertible into
          Common Stock by surrender to the Corporation of the certificate
          representing such shares of Series III Class B Preferred Stock to be
          converted by the Holder and by giving written notice to the
          Corporation of the Holder's election to convert.

          The Corporation shall, as soon as practicable after receipt of such
          written notice and the proper surrender to the Corporation of the
          certificate or certificates representing shares of Series III Class B
          Preferred Stock to be converted in accordance with the above
          provisions, issue and deliver for the benefit of the Holder at the
          office of the Corporation's duly appointed transfer agent (the
          "Transfer Agent") to the Holder for whose account such shares of
          Series III Class B Preferred Stock were so surrendered or to such
          Holder's nominee or nominees, certificates for the number of shares of
          Common Stock to which the Holder shall be entitled. The certificates
          of Common Stock of the Corporation issued upon conversion shall bear
          such legends as may be required by state or federal laws. Such
          conversion shall be deemed to have been effective immediately prior to
          the close of business on the date on which the Corporation shall have
          received both such written notice and the properly surrendered
          certificates for shares of Series III Class B Preferred Stock to be
          converted (the "Conversion Date"), and at such time the rights of the
          Holder shall cease and the person or persons entitled to receive the
          shares of Common Stock issuable upon the conversion of such shares of
          Series III Class B Preferred Stock shall be deemed to be, and shall be
          treated for all purposes as, the record Holder or Holders of such
          Common Stock on the Conversion Date. The Corporation shall not be
          required to convert, and no surrender of shares of Series III Class B
          Preferred Stock or written notice of conversion with respect thereto
          shall be effected for that purpose, while the stock transfer books of
          the Corporation are closed for any reasonable business purpose for any
          reasonable period of time, but shall be required to convert upon the
          proper surrender of shares of Series III Class B Preferred Stock for
          conversion

PRIVATE PLACEMENT MEMORANDUM
------------------------------
RETRACTABLE TECHNOLOGIES, INC.
-------------------------------
RTIPVTPL. July 10, 1998                   66

<PAGE>

          immediately upon the reopening of such books. During the period in
          which the stock transfer books of the Corporation are closed, the
          Corporation may neither declare a dividend, declare a record date for
          payment of dividends nor make any payment of dividends.

     b.   Dividends. If any shares of Series III Class B Preferred Stock shall
          be converted during any dividend payment period, the Holder shall be
          entitled to all dividends accrued up to and through such Conversion
          Date, at the rate set forth herein, whether or not there has been a
          dividend date, as set forth in paragraph 2 hereof.

     c.   Cancellation. Series III Class B Preferred Stock converted into Common
          stock pursuant to the provisions of this paragraph 6 shall be retired
          and cancelled by the Corporation and given the status of authorized
          and unissued preferred stock.

     d.   Reissuance if Conversion is Partial. In the case of any certificate
          representing shares of Series III Class B Preferred Stock which is
          surrendered for conversion only in part, the Corporation shall issue
          and deliver to the Holder a new certificate or certificates for Series
          III Class B Preferred Stock of such denominations as requested by the
          Holder in the amount of Series III Class B Preferred Stock equal to
          the unconverted shares of the Series III Class B Preferred Stock
          represented by the certificate so surrendered.

     e.   Reservations of Shares. The Corporation shall at all times during
          which shares of Series III Class B Preferred Stock may be converted
          into Common Stock as provided in this paragraph (e), reserve and keep
          available, out of any Common Stock held as treasury stock or out of
          its authorized and unissued Common Stock, or both, solely for the
          purpose of delivery upon conversion of the shares of Series III Class
          B Preferred Stock as herein provided, such number of shares of Common
          Stock as shall then be sufficient to effect the conversion of all
          shares of Series III Class B Preferred Stock from time to time
          outstanding, and shall take such action as may from time to time be
          necessary to ensure that such shares of Common Stock will, when issued
          upon conversion of Series III Class B Preferred Stock, be fully paid
          and nonassessable.

     f.   Adjustment of Conversion Rate. The Conversion Rate provided in
          subdivision (a) of this paragraph 6, in respect of Series III Class B
          Preferred Stock, shall be subject to adjustments from time to time as
          follows:

          (i)   While any shares of Series III Class B Preferred Stock shall be
                outstanding, in case the Corporation shall subdivide the
                outstanding shares of Common Stock into a greater number of
                shares of Common Stock or combine the outstanding shares of
                Common Stock into a smaller number of shares of Common Stock, or
                issue, by reclassification of its shares of Common Stock, any
                shares of the Corporation, the Conversion Rate in effect
                immediately prior thereto shall be adjusted so that the Holder
                shall be entitled to receive the number of shares which it would
                have owned or been entitled to receive after the happening of
                any of the events described above, had such shares of Series III
                Class B Preferred Stock been converted immediately prior to the
                happening of such event, such adjustment to become effective
                immediately after the opening of business on the day following
                the day upon which such subdivision or combination or
                reclassification, as the case may be, becomes effective.

          (ii)  In case the Corporation shall be consolidated with, or merge
                into, any other corporation, and the Corporation does not
                survive, proper provisions shall be made as a part of the terms
                of such consolidation or merger, whereby the Holder shall
                thereafter be entitled, upon exercise of such Holder's
                conversion rights, to receive the kind and amount of shares of
                stock or other securities of the Corporation resulting from such
                consolidation or merger, or such other property, as the Holder
                would have received if such conversion rights were exercised
                immediately prior to the effectiveness of such merger or
                consolidation.

          (iii) In the event the Corporation at any time, or from time to time
                after August 1, 1998 makes or issues, or fixes a record date for
                the determination of holders of Common Stock entitled to
                receive, a dividend or other distribution payable in additional
                shares of Common Stock or Common Stock Equivalents (as defined
                herein) which does not provide for the payment of any
                consideration upon the issuance, conversion or exercise

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<PAGE>

               thereof, without a corresponding dividend or other distribution
               to the Holder, based upon the number of shares of Common Stock
               into which the Series III Class B Preferred Stock is convertible,
               then and in each such event the Conversion Rate then in effect
               will be increased as of the time of such issuance or, in the
               event such a record date shall have been fixed, as of the close
               of business on such record date, by multiplying such Conversion
               rate by a fraction:

               (A)  The numerator of which will be the total number of shares of
                    Common Stock issued and Outstanding immediately prior to the
                    time of such issuance or the close of business on such
                    record date plus the number of shares of Common Stock
                    issuable in payment of such dividend or distribution (which,
                    in the case of Common Stock Equivalents, shall mean the
                    maximum number of shares of Common Stock issuable with
                    respect thereto, as set forth in the instrument relative
                    thereto without regard to any provision for subsequent
                    adjustment); and

               (B)  The denominator of which will be the total number of shares
                    of Common Stock issued and outstanding immediately prior to
                    the time of such issuance or the close of business on such
                    record date; provided, however, that if such record date is
                    fixed and such dividend is not fully paid or if such
                    distribution is not fully made on the date fixed therefor,
                    the Conversion Rate will be recomputed accordingly as of the
                    close of business on such record date, and thereafter such
                    Conversion Rate will be adjusted pursuant to this
                    subparagraph (iii) as of the time of actual payment of such
                    dividends or distributions.

          (iv)  In the event the Corporation at any time or from time to time
                after August 1, 1998 makes or issues, or fixes a record date for
                the determination of holders of Common Stock entitled to receive
                a dividend or other distribution payable to all holders of
                Common Stock in securities of the Corporation or Common Stock
                Equivalents, then, upon making such dividend or distribution
                provisions will be made so that the Holder will receive the
                amount of securities of the Corporation which it would have
                received had its Series III Class B Preferred Stock been
                converted into Common Stock on the date of such event.

          (v)   In the event the Corporation sells or issues any Common Stock,
                or sells or issues Common Stock Equivalents which can be
                converted into Common Stock at a per share consideration (as
                defined below in this subparagraph (v) of paragraph 6(f) less
                than the Stipulated Price then in effect, then the Holder shall
                be entitled to purchase from the Corporation in cash (for the
                same per share consideration at which such Common Stock was
                issued or the per share price at which a share of Common Stock
                is acquirable upon exercise or conversion of Common Stock
                Equivalents) that additional number of shares of Common Stock
                which, when added to the number of shares of Common Stock
                acquirable by the Holder upon conversion of any shares of Series
                III Class B Preferred Stock outstanding and held by such Holder
                immediately before such issue or sale (the "Acquirable Shares"),
                will equal a percentage of the number of shares of Common Stock
                Deemed Outstanding (as defined herein) immediately after such
                sale or issuance that is the same as the percentage of the
                number of shares of Common Stock Deemed Outstanding immediately
                before such issuance or sale represented by the Acquirable
                Shares. This right shall exist for a forty-five-day period
                following the sale or issuance of shares of Common Stock or
                Common Stock Equivalents, and thereafter shall cease to exist.

                For the above purposes, the per share consideration with respect
                to the sale or issuance of Common Stock will be the price per
                share received by the Corporation, prior to the payment of any
                expenses, commissions, discounts and other applicable costs.
                With respect to the sale or issuance of Common Stock Equivalents
                which are convertible into or exchangeable for Common Stock
                without further consideration, the per share consideration will
                be determined by dividing the maximum number of shares of Common
                Stock issuable with respect to such Common Stock Equivalents (as
                set forth in the instrument relating thereto without regarding
                to any provisions contained therein for subsequent adjustment of
                such number) into the aggregate consideration receivable by the
                Corporation upon the sale or issuance of such Common Stock
                Equivalents. With respect to the issuance of other Common Stock
                Equivalents, the per share consideration will be determined by
                dividing the maximum number of shares of Common Stock issuable
                with respect to such Common Stock Equivalents into the total
                aggregate consideration received by the Corporation upon the
                sale

PRIVATE PLACEMENT MEMORANDUM
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<PAGE>

            or issuance of such Common Stock Equivalents plus the minimum
            aggregate amount of additional consideration received by the
            Corporation upon the conversion or exercise of such Common Stock
            Equivalents. In connection with the sale or issuance of Common Stock
            and/or Common Stock Equivalents for non-cash consideration, the
            amount of consideration will be the fair market value of such
            consideration as determined in good faith by the Board of Directors
            of the Corporation.

     (vi)   As used herein, the term "Stipulated Price" means initial price of
            $10.00 per share of Common Stock, as adjusted from time to time
            pursuant to subparagraph (viii) of this paragraph 6(f); and the term
            "Common Stock Equivalent" means any securities (whether debt or
            equity securities) or rights issued by the Corporation convertible
            into or entitling the holder thereof to receive shares of, or
            securities convertible into, Common Stock. The number of shares of
            "Common Stock Deemed Outstanding" at any date shall equal the sum of
            the number of shares of Common Stock then outstanding plus the
            number of shares of Common Stock then obtainable pursuant to Common
            Stock Equivalents.

     (vii)  In the event the Corporation declares any dividend or distribution
            payable to holders of its Common Stock (other than dividends payable
            out of the Corporation's retained earnings or earned surplus and
            dividends payable in shares of Common Stock or in securities
            convertible into or exchangeable for shares of Common Stock or
            rights or warrants to purchase Common Stock or securities
            convertible into or exchangeable for shares of Common Stock or
            securities convertible into or exchangeable for shares of Common
            Stock or any other securities issued by the Corporation), the
            Conversion Rate in effect immediately prior to the record date for
            such dividend or distribution shall be proportionately adjusted so
            that the Holder shall be entitled to receive the number of shares of
            Common Stock into which such shares of Common Stock or Preferred
            Stock was convertible immediately prior to such record date
            multiplied by a fraction, the numerator of which is the fair market
            value of a share of Common Stock on such record date and the
            denominator of which is such per share fair market value of a share
            of Common Stock on such record date less the fair market value on
            such record date of the securities or other property which are
            distributed as a dividend or other distribution. The term "fair
            market value" of a share of Common Stock or of any other security or
            other type of property on any date means (A) in the case of Common
            Stock or any other security (I) if the principal trading market for
            such Common Stock or other security is an exchange or the NASDAQ
            national market on such date, the closing price on such exchange or
            the NASDAQ national market on such date, provided, if trading of
            such Common Stock or other security is listed on any consolidated
            tape, the fair market value shall be the closing price set forth on
            such consolidated tape on such date, or (II) if the principal market
            for such Common Stock or other security is the over-the-counter
            market (other than the NASDAQ national market) the mean between the
            closing bid and asked prices on such date as set forth by NASDAQ or
            (B) in the case of Common Stock or any other security for which the
            fair market value cannot be determined pursuant to clause (A) above
            or of any other security or type of property, fair market value
            thereof on such date as determined in good faith by the Board of
            Directors.

     (viii) Whenever the Conversion Rate is adjusted pursuant to this paragraph
            6(f), the Stipulated Price shall also be adjusted by multiplying it
            by a fraction that is the reciprocal of the fraction used to adjust
            the Conversion Rate.

     (ix)   The Corporation will not, by amendment of its Articles of
            Incorporation or through any dissolution, issuance or sale of
            securities or any other voluntary action, avoid or seek to avoid the
            observance or performance of any of the terms to be observed or
            performed hereunder by the Corporation, but at all times in good
            faith will assist in the carrying out of all the provisions of this
            paragraph and in the taking of all such action as may be necessary
            or appropriate in order to protect the conversion rights of the
            Holder against impairment.

     (x)    No adjustment in the Conversion Rate shall be required, unless such
            adjustment would require an increase or decrease of at least one (1)
            share of Common Stock in the Conversion Rate of one share of Series
            III Class B Preferred Stock, provided that all adjustments which do
            not meet this minimum requirement shall be cumulated and the
            adjustment will be made when the cumulated total is sufficient to
            require an adjustment.

PRIVATE PLACEMENT MEMORANDUM
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<PAGE>

              All calculations made pursuant to this subparagraph (x) of
              paragraph 6(f) shall be made to the nearest one-hundredth
              (1/100th) of a share of Common Stock.

     g.   Fractional Shares. No fractional shares of Common Stock or scrip
          representing fractional shares of Common Stock shall be issued upon
          any conversion of shares of Series III Class B Preferred Stock but, in
          lieu thereof, there shall be paid an amount in cash equal to the same
          fraction of the current market price of a whole share of Common Stock
          on the day preceding the day of conversion.

     h.   Statement to Transfer Agent. Whenever the Conversion Rate for shares
          of Series III Class B Preferred Stock shall be adjusted pursuant to
          the provisions of paragraph 6(f) hereof, the Corporation shall
          forthwith maintain at its office and, if applicable, file with the
          Transfer Agent for shares of Series III Class B Preferred Stock and
          for shares of Common Stock, a statement signed by the President or a
          Vice President of the Corporation and by its Treasurer or an Assistant
          Treasurer, stating the adjusted Conversion Rate and setting forth in
          reasonable detail the method of calculation and the facts requiring
          such adjustment, such calculations to be confirmed by the
          Corporation's independent auditors, and stating the facts on which the
          calculation is based. Each adjustment shall remain in effect until a
          subsequent adjustment hereunder is required.

7.   Registration Rights.

     a.   Piggyback Registration. The Corporation, for a period ending six
          months after the last share of Series III Class B Preferred Stock is
          redeemed, retired, converted or otherwise no longer outstanding, will
          give written notice to the Holder not less than 20 days in advance of
          the initial filing of any registration statement under the Securities
          Act of 1933 (other than a registration Statement pertaining to
          securities issuable pursuant to employee stock option, stock purchase,
          or similar plans or a registration statement pertaining to securities
          issuable in connection with the acquisition of a business, whether
          through merger, consolidation, acquisition of assets, or exchange of
          securities) covering any Common Stock or other securities of the
          Corporation, and will afford the Holder the opportunity to have
          included in such registration all or such part of the shares of Common
          Stock acquired upon conversion of Series III Class B Preferred Stock,
          as may be designated by written notice to the Corporation not later
          than 10 days following receipt of such notice from the Corporation.
          The Corporation shall be entitled to exclude the shares of Common
          Stock held by the Holder from any one, but not more than one, such
          registration if the Corporation in its sole discretion decides that
          the inclusion of such shares will materially interfere with the
          orderly sale and distribution of the securities being offered under
          such registration statement by the Corporation. Notwithstanding the
          foregoing, the Corporation shall not be entitled to exclude the shares
          of Common Stock held by the Holder if shares of other shareholders are
          being included in any such registration statement and, in such
          circumstances, the Holder shall be entitled to include the shares of
          Common Stock held by them on a pro rata basis in the proportion that
          the number of shares of Common Stock held by the Holder bears to the
          shares of Common Stock held by all other shareholders, including
          shares in such registration statement. The Holder shall not be
          entitled to include shares in more than two registration statement
          pursuant to the provisions of this subdivision (a) of paragraph 7, and
          all rights of the Holder under this subdivision (a) of paragraph 7
          shall terminate after the Holder has included shares of Common Stock
          in two registration statements pursuant to this subdivision A of
          paragraph 7.

     b.   Expenses. The Corporation will pay all out-of-pocket costs and
          expenses of any registration effected pursuant to the provisions of
          subdivision (a) of this paragraph 7, including registration fees,
          legal fees, accounting fees, printing expenses (including such number
          of any preliminary and the final prospectus as may be reasonably
          requested), blue sky qualification fees and expenses, and all other
          expenses, except for underwriting commissions or discounts applicable
          to the shares of Common Stock being sold by the Holder and the fees of
          counsel for the Holder, all of which shall be paid by the Holder.

     c.   Notwithstanding anything to the contrary contained herein, in the
          event that the Corporation files an initial registration statement
          under the Securities Act of 1933, as amended (other than a
          registration statement pertaining to securities issuable in connection
          with the acquisition of a business, whether through merger,
          consolidation,

PRIVATE PLACEMENT MEMORANDUM
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<PAGE>

          acquisition of assets or exchange of securities) concerning any Common
          Stock of the Corporation, it will afford the Holder the opportunity to
          convert his shares into that number of fully paid and non-assessable
          shares of Common Stock prior to the three year holding period stated
          in paragraph 6 above. The Corporation may also, at its option at any
          time within one-hundred and eighty (180) days after an initial
          registration statement is deemed effective, demand the conversion of
          the Series III Class B Preferred Stock into that number of fully paid
          and non-assessable shares of Common Stock as provided herein.

8.   Reports.

     So long as any of the Series III Class B Preferred Stock shall be
     outstanding, the Corporation shall submit to the Holder financial reports
     no less frequently than annually.

9.   Miscellaneous.

     a.   As used herein, the term "Common Stock" shall mean the Corporation's
          Common Stock, no par value, or, in the case of any reclassification or
          change of outstanding shares of Common Stock, the stock or securities
          issued in exchange for such Common Stock. The term "Common Stock"
          shall also include any capital stock of the Corporation authorized
          after March 31, 1998 which shall not be limited to a fixed sum or
          sums or percentage or percentages of par value in respect of the
          rights of the holders thereof to participate in dividends or in the
          distribution of assets upon the voluntary or involuntary liquidation,
          dissolution or winding up of the Corporation.

     b.   The shares of Series III Class B Preferred Stock shall be fully
          transferable by the Holder thereof, subject to compliance with the
          applicable provisions of federal and state securities laws.

IN WITNESS WHEREOF, RETRACTABLE TECHNOLOGIES, INC. has caused its corporate seal
to be hereunto affixed and this Certificate to be signed by its Chief Executive
Officer Secretary this 10 day of July, 1998.

                                       /s/ Thomas J. Shaw
                                     -------------------------------------
                                     THOMAS J. SHAW,
                                     Its: Chief Executive Officer

ATTEST:

  /s/ Lillian E. Salerno
-----------------------------
LILLIAN E. SALERNO
Secretary

PRIVATE PLACEMENT MEMORANDUM
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RETRACTABLE TECHNOLOGIES, INC.
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                                                                       EXHIBIT E

                                                                FILED
                                                         In the Office of the
                                                     Secretary of State of Texas
                                                             JAN 24 2000
                                                        Corporations Section


        CERTIFICATE OF DESIGNATION, PREFERENCES, RIGHTS AND LIMITATIONS
             OF THE SERIES IV CLASS B CONVERTIBLE PREFERRED STOCK
                                       OF

                         RETRACTABLE TECHNOLOGIES, INC.

Pursuant to Article 2.13 of the Texas Business Corporation Act and Article Four
of its Articles of Incorporation, Retractable Technologies, Inc., a corporation
organized and existing under the laws of the State of Texas (the "Corporation"),

DOES HEREBY CERTIFY that, pursuant to the authority conferred upon the Board of
Directors of the Corporation by the Articles of Incorporation, as amended, and
pursuant to the Texas Business Corporation Act, said Board of Directors, by
unanimous written consent, executed December 20, 1999, adopted a resolution
providing for the creation of a series of Preferred Stock consisting of not more
than one million three hundred thousand (1,300,000) shares of Series IV Class B
Convertible Preferred Stock, which resolution is and reads as follows:

RESOLVED that pursuant to the authority provided in the Corporation's Articles
of Incorporation and expressly granted to and vested in the Board of Directors
of the Corporation, the Board of Directors hereby creates out of the Preferred
Stock, par value One Dollar ($1.00) per share, of the Corporation a series of
Preferred Stock called the Series IV Class B Preferred Stock, consisting of not
more than one million three hundred thousand (1,300,000) shares, and the Board
of Directors hereby fixes the designation and the powers, preference and rights,
and the qualifications, limitations and restrictions thereof, to the extent not
otherwise provided in the Corporation's qualifications, limitations and
restrictions thereof, to the extent not otherwise provided in the Corporation's
Articles of Incorporation, as follows:

1.        Designation of Series. The designation of the series of Preferred
          Stock created by this resolution shall be "Series IV Class B
          Convertible Preferred Stock" (the "Series IV Class B Preferred
          Stock").

2.        Dividends on Series IV Class B Preferred Stock.

          a.   Dividend Amount. The holders of the Series IV Class B Preferred
               Stock shall be entitled to receive, in any calendar year, if,
               when and as declared by the Board of Directors, out of any assets
               at the time legally available therefor and subject to the further
               limitations set out herein, dividends at the per annum rate of
               $1.00 per share, all such dividends due quarterly in arrears as
               of the last day of each March, June, September and December of
               each year, the first dividend being declarable on December 31,
               2000. On each date which a dividend may be declared is hereafter
               called the "Dividend Date," and each quarterly period ending with
               a Dividend Date is hereinafter referred to as the "Dividend
               Period." Dividends shall be payable fifteen calendar days after
               the Dividend Due Date, provided however, that if such date on
               which a dividend is payable is a Saturday, Sunday or legal
               holiday, such dividend shall be payable on the next following
               business day to the holders of record (whether singular or
               plural, the "Holder").

          b.   Dividends Cumulative. Dividends upon the Series IV Class B
               Preferred Stock shall be accrued and be cumulative, whether or
               not in any Dividend Period or Periods there shall be funds of the
               Corporation legally available for the payment of such dividends.

          c.   Dividend Accrual. On each Dividend Due Date all dividends which
               shall have accrued since the last Dividend Due Date on each share
               of Series IV Class B Preferred Stock outstanding on such Dividend
               Due Date shall accumulate and be deemed to become "due." Any
               dividend which shall not be paid on the Dividend Due Date on
               which it shall become due shall be deemed to be "past due" until
               such dividend shall be paid or until the share of Series IV Class
               B Preferred Stock with respect to which such dividend became due
               shall no longer be outstanding, whichever is the earlier to
               occur. No interest, sum of money in lieu of interest or other
               property or securities shall be payable in respect of any
               dividend payment or payments which are past due. Dividends paid
               on shares of Series IV Class B Preferred Stock in an amount less
               that the total amount of such

                                        1

<PAGE>

               dividends at the time accumulated and payable on such shares
               shall be allocated pro rata on a share-by-share basis among all
               such shares at the time outstanding. Dividend payments made with
               respect to a Dividend Due Date shall be deemed to be made in
               payment of the dividends which became due on that Dividend Due
               Date.

          d.   Dividend Arrearage. If a dividend upon any shares of Series IV
               Class B Preferred Stock is in arrears, all dividends or other
               distributions declared upon shares of the Series IV Class B
               Preferred Stock (other than dividends paid in stock of the
               Corporation ranking junior to the Series IV Class B Preferred
               Stock as to dividends and upon liquidation, dissolution or
               winding up) may only be declared pro rata. Except as set forth
               above, if a dividend upon any shares of Series IV Class B
               Preferred Stock is in arrears: (i) no dividends (in cash, stock
               or other property) may be paid or declared and set aside for
               payment or any other distribution made upon any stock of the
               Corporation ranking junior to the Series IV Class B Preferred
               Stock as to dividends (other than dividends of distributions in
               stock of the Corporation ranking junior to the Series IV Class B
               Preferred Stock as to dividends and upon liquidation, dissolution
               or winding up); and (ii) no stock of the Corporation ranking
               junior to the Series IV Class B Preferred Stock as to dividends
               may be (A) redeemed pursuant to a sinking fund or otherwise,
               except (1) by means of redemption pursuant to which all
               outstanding shares of the Series IV Class B Preferred Stock are
               redeemed, or (2) by conversion of any such junior stock into, or
               exchange of any such junior stock into, or exchange of any such
               junior stock for stock of the Corporation ranking junior to the
               Series IV Class B Preferred Stock as to dividends and upon
               liquidation, dissolution or winding up, or (B) purchased or
               otherwise acquired for any consideration by the Corporation
               except (1) pursuant to an acquisition made pursuant to the terms
               of one or more offers to purchase all of the outstanding shares
               of the Series IV Class B Preferred Stock, which offers shall each
               have been accepted by the holders of at least 50% of the shares
               of the Series IV Class B Preferred Stock receiving such offer
               outstanding at the commencement of the first of such purchase
               offers, or (2) by conversion into or exchange for stock of the
               Corporation ranking junior to the Series IV Class B Preferred
               Stock as to dividends and upon liquidation or winding up.

3.        General, Class and Series Voting Rights. Except as provided in this
          Section 3, or as otherwise from time to time required by law, the
          Series IV Class B Preferred Stock shall have no voting rights.

          So long as any shares of Series IV Class B Preferred Stock remain
          outstanding, the consent of the holders of at least fifty-one percent
          (51%) of the shares of Series IV Class B Preferred Stock outstanding
          at the time voting separately as a class, given in person or by proxy,
          either in writing at any special or annual meeting called for the
          purpose, shall be necessary to permit, effect or validate any one or
          more of the following:

          (i)  The authorization, creation or issuance, or any increase in the
               authorized or issued amount, of any class or series of stock
               (including any class or series of Preferred Stock) ranking equal
               or prior to the Series IV Class B Preferred Stock; or

          (ii) The amendment, alteration, or repeal, whether by merger,
               consolidation or otherwise, of any of the provisions of the
               Articles of Incorporation or of this resolution which would alter
               or change the powers, preferences or special rights of the shares
               of the Series IV Class B Preferred Stock so as to affect them
               adversely; provided, however, that any increase in the amount of
               authorized Preferred Stock, or the creation and issuance of other
               series of Preferred stock ranking junior to the Series IV Class B
               Preferred Stock with respect to the payment of dividends and the
               distribution of assets upon liquidation, dissolution or winding
               up, shall not be deemed to adversely affect such powers,
               preferences or special rights.

          The foregoing voting provisions shall not apply if, at or prior to the
          time when the act with respect to which such vote would otherwise be
          required shall be effected, all outstanding shares of Series IV Class
          B Preferred Stock shall have been redeemed or sufficient funds shall
          have been deposited in trust to effect such redemption.

                                        2

<PAGE>

4.   Redemption. The outstanding shares of Series IV Class B Preferred Stock
     shall be nonredeemable prior to the lapse of three (3) years from the date
     of issuance. On and after such date, the Series IV Class B Preferred Stock
     may be redeemed at the option of the Corporation, as a whole at any time or
     in part from time to time, at the Redemption Price of $11.00 per share plus
     all dividends (whether or not declared or due) accrued and unpaid to the
     date of redemption (subject to the right of the holder of record of shares
     of Series IV Class B Preferred Stock on a record date for the payment of a
     dividend on the Series IV Class B Preferred Stock to receive the dividend
     due on such shares of Series IV Class B Preferred Stock on the
     corresponding Dividend Due Date).

     No sinking fund shall be established for the Series IV Class B Preferred
     Stock.

     Notice of any proposed redemption of shares of Series IV Class B Preferred
     Stock shall be mailed by means of first class mail, postage paid, addressed
     to the holders of record of the shares of Series IV Class B Preferred Stock
     to be redeemed, at their respective addresses then appearing on the books
     of the Corporation, at least thirty (30) days but not more than sixty (60)
     days prior to the date fixed for such redemption (herein referred to as the
     "Redemption Date"). Each such notice shall specify (i) the Redemption Date;
     (ii) the Redemption Price; (iii) the place for payment and for delivering
     the stock certificate(s) and transfer instrument(s) in order to collect the
     Redemption Price; (iv) the shares of Series IV Class B Preferred Stock to
     be redeemed; and (v) the then effective Conversion Price (as defined below)
     and that the right of holders of shares of Series IV Class B Preferred
     Stock being redeemed to exercise their conversion right shall terminate as
     to such shares at the close of business on the fifth day before the
     Redemption Date, provided that no default by the Corporation in the payment
     of the applicable Redemption Price (including any accrued and unpaid
     dividends) shall have occurred and be continuing. Any notice mailed in such
     manner shall be conclusively deemed to have been duly given whether or not
     such notice is, in fact, received. If less than all the outstanding shares
     of Series IV Class B Preferred Stock are to be redeemed, the Corporation
     will select those to be redeemed by lot or by a substantially equivalent
     method. In order to facilitate the redemption of Series IV Class B
     Preferred Stock to be redeemed, notice of any such proposed redemption
     shall not be more than sixty (60) days prior to the Redemption Date with
     respect thereto.

     The holder of any shares of Series IV Class B Preferred Stock redeemed upon
     any exercise of the Corporation's redemption right shall not be entitled to
     receive payment of the Redemption Price for such shares until such holder
     shall cause to be delivered to the place specified in the notice given with
     respect to, such redemption (i) the certificate(s) representing such shares
     of Series IV Class B Preferred Stock; and (ii) transfer instrument(s)
     satisfactory to the Corporation and sufficient to transfer such shares free
     of any adverse interest. No interest shall accrue on the Redemption Price
     of any share of Series IV Class B Preferred Stock after its Redemption
     Date.

     Subject to Section 2 hereof, the Corporation shall have the right to
     purchase shares of Series IV Class B Preferred Stock from the owner of such
     shares on such term as may be agreeable to such owner. Shares of Series IV
     Class B Preferred Stock may be acquired by the Corporation from any
     stockholder pursuant to this paragraph without offering any other
     stockholder an equal opportunity to sell his stock to the Corporation, and
     no purchase by the Corporation from any stockholder pursuant to this
     paragraph shall be deemed to create any right on the part of any
     stockholder to sell any shares of Series IV Class B Preferred Stock (or any
     other stock) to the Corporation.

     Notwithstanding the foregoing provisions of this Section 4, and subject to
     the provisions of Section 2 hereof, if a dividend upon any shares of Series
     IV Class B Preferred Stock is past due, no shares of the Series IV Class B
     Preferred Stock may be redeemed, except (i) by means of a redemption
     pursuant to which all outstanding shares of the Series IV Class B Preferred
     Stock are simultaneously redeemed (or offered to be so redeemed) or
     pursuant to which the outstanding shares of the Series IV Class B Preferred
     Stock are redeemed on a pro rata basis (or offered to be so redeemed), or
     (ii) by conversion of shares of Series IV Class B Preferred Stock into, or
     exchange of such shares for, Common Stock or any other stock of the
     Corporation ranking junior to the Series IV Class B Preferred Stock as to
     dividends and upon liquidation, dissolution or winding up.

                                        3

<PAGE>

5.   Liquidation. In the event of any voluntary or involuntary dissolution,
     liquidation or winding up of the Corporation (for the purposes of this
     Section 5, a "Liquidation"), before any distribution of assets shall be
     made to the holders of the Common Stock or the holders of any other stock
     that ranks junior to the Series IV Class B Preferred Stock in respect of
     distributions upon the Liquidation of the Corporation, the holder of each
     share of Series IV Class B Preferred Stock then outstanding shall be
     entitled to $11.00 per share plus all dividends (whether or not declared or
     due) accrued and unpaid on such share on the date fixed for the
     distribution of assets of the Corporation to the holders of Series IV Class
     B Preferred Stock.

     If upon any Liquidation of the Corporation, the assets available for
     distribution to the holder of Series IV Class B Preferred Stock which shall
     then be outstanding (hereinafter in this paragraph called the "Total Amount
     Available") shall be insufficient to pay the holders of all outstanding
     shares of Series IV Class B Preferred Stock the full amounts (including all
     dividends accrued and unpaid) to which they shall be entitled by reason of
     such Liquidation of the Corporation, then there shall be paid ratably to
     the holders of the Series IV Class B Preferred Stock in connection with
     such Liquidation of the Corporation, an amount equal to each holder's pro
     rata share of the Total Amount Available.

     The voluntary sale, conveyance, lease, exchange or transfer of all or
     substantially all the property or assets of the Corporation, or the merger
     or consolidation of the Corporation into another Corporation, or any
     purchase or redemption of some or all of the shares of any class or series
     of stock of the Corporation, shall not be deemed to be a Liquidation of the
     Corporation for the purposes of this Section 6 (unless in connection
     therewith the Liquidation of the Corporation is specifically approved).

6.   Conversion Privilege. At any time subsequent to three years after issuance
     of any share of Series IV Class B Preferred Stock, the holder of any share
     of Series IV Class B Preferred Stock ("Holder") shall have the right, at
     such Holder's option (but if such share is called for redemption or
     exchange at the election of the Corporation, then in respect of such share
     only to and including but not after the close of business on (i) the fifth
     calendar day before the date fixed for such redemption; or (ii) the date
     fixed for such exchange, provided that the Corporation has set aside funds
     sufficient to effect such redemption) to convert such share into that
     number of fully paid and non-assessable shares of Common Stock (calculated
     as to each conversion to the nearest 1/100th of a share) obtained by
     dividing $10.00 by the Conversion Rate then in effect.

     a.   Conversion Rate. Each share of Series IV Class B Preferred Stock may
          be converted, subject to the terms and provisions of this paragraph 6
          into one (1) share of the Corporation's Common Stock, which is a price
          equal to one share of Common Stock for each $10.00 of Series IV Class
          B Preferred Stock or, in case an adjustment of such rate has taken
          place pursuant to the provisions of subdivision (f) of this paragraph
          6, then at the Conversion Rate as last adjusted (such rate or adjusted
          rate, shall be expressed as the number of shares of Common Stock to be
          acquired upon conversion of one share of Series IV Class B Preferred
          Stock, and shall be referred to herein as the "Conversion Rate")
          ("Conversion Price"). Each share of Series IV Class B Preferred Stock
          shall be Convertible into Common Stock by surrender to the Corporation
          of the certificate representing such shares of Series IV Class B
          Preferred Stock to be converted by the Holder and by giving written
          notice to the Corporation of the Holder's election to convert.

          The Corporation shall, as soon as practicable after receipt of such
          written notice and the proper surrender to the Corporation of the
          certificate or certificates representing shares of Series IV Class B
          Preferred Stock to be converted in accordance with the above
          provisions, issue and deliver for the benefit of the Holder at the
          office of the Corporation's duly appointed transfer agent (the
          "Transfer Agent") to the Holder for whose account such shares of
          Series IV Class B Preferred Stock were so surrendered or to such
          Holder's nominee or nominees, certificates for the number of shares of
          Common Stock to which the Holder shall be entitled. The certificates
          of Common Stock of the Corporation issued upon conversion shall bear
          such legends as may be required by state or federal laws.

                                        4

<PAGE>

          Such conversion shall be deemed to have been effective immediately
          prior to the close of business on the date on which the Corporation
          shall have received both such written notice and the properly
          surrendered certificates for shares of Series IV Class B Preferred
          Stock to be converted (the "Conversion Date"), and at such time the
          rights of the Holder shall cease and the person or persons entitled to
          receive the shares of Common Stock issuable upon the conversion of
          such shares of Series IV Class B Preferred Stock shall be deemed to
          be, and shall be treated for all purposes as, the record Holder or
          Holders of such Common Stock on the Conversion Date. The Corporation
          shall not be required to convert, and no surrender of shares of Series
          IV Class B Preferred Stock or written notice of conversion with
          respect thereto shall be effected for that purpose, while the stock
          transfer books of the Corporation are closed for any reasonable
          business purpose for any reasonable period of time, but shall be
          required to convert upon the proper surrender of shares of Series IV
          Class B Preferred Stock for conversion immediately upon the reopening
          of such books. During the period in which the stock transfer books of
          the Corporation are closed, the Corporation may neither declare a
          dividend, declare a record date for payment of dividends nor make any
          payment of dividends.

     b.   Dividends. If any shares of Series IV Class B Preferred Stock shall be
          converted during any dividend payment period, the Holder shall be
          entitled to all dividends accrued up to and through such Conversion
          Date, at the rate set forth herein, whether or not there has been a
          dividend date, as set forth in paragraph 2 hereof.

     c.   Cancellation. Series IV Class B Preferred Stock converted into Common
          stock pursuant to the provisions of this paragraph 6 shall be retired
          and cancelled by the Corporation and given the status of authorized
          and unissued preferred stock.

     d.   Reissuance if Conversion is Partial. In the case of any certificate
          representing shares of Series IV Class B Preferred Stock which is
          surrendered for conversion only in part, the Corporation shall issue
          and deliver to the Holder a new certificate or certificates for Series
          IV Class B Preferred Stock of such denominations as requested by the
          Holder in the amount of Series IV Class B Preferred Stock equal to the
          unconverted shares of the Series IV Class B Preferred Stock
          represented by the certificate so surrendered.

     e.   Reservations of Shares. The Corporation shall at all times during
          which shares of Series IV Class B Preferred Stock may be converted
          into Common Stock as provided in this paragraph (e), reserve and keep
          available, out of any Common Stock held as treasury stock or out of
          its authorized and unissued Common Stock, or both, solely for the
          purpose of delivery upon conversion of the shares of Series IV Class B
          Preferred Stock as herein provided, such number of shares of Common
          Stock as shall then be sufficient to effect the conversion of all
          shares of Series IV Class B Preferred Stock from time to time
          outstanding, and shall take such action as may from time to time be
          necessary to ensure that such shares of Common Stock will, when issued
          upon conversion of Series IV Class B Preferred Stock, be fully paid
          and nonassessable.

     f.   Adjustment of Conversion Rate. The Conversion Rate provided in
          subdivision (a) of this paragraph 6, in respect of Series IV Class B
          Preferred Stock, shall be subject to adjustments from time to time as
          follows:

          (i)  While any shares of Series IV Class B Preferred Stock shall be
               outstanding, in case the Corporation shall subdivide the
               outstanding shares of Common Stock into a greater number of
               shares of Common Stock or combine the outstanding shares of
               Common Stock into a smaller number of shares of Common Stock, or
               issue, by reclassification of its shares of Common Stock, any
               shares of the Corporation, the Conversion Rate in effect
               immediately prior thereto shall be adjusted so that the Holder
               shall be entitled to receive the number of shares which it would
               have owned or been entitled to receive after the happening of any
               of the events described above, had such shares of Series IV Class
               B Preferred Stock been converted immediately prior to the
               happening of such event, such

                                        5

<PAGE>

                adjustment to become effective immediately after the opening of
                business on the day following the day upon which such
                subdivision or combination or reclassification, as the case may
                be, becomes effective.

          (ii)  In case the Corporation shall be consolidated with, or merge
                into, any other corporation, and the Corporation does not
                survive, proper provisions shall be made as a part of the terms
                of such consolidation or merger, whereby the Holder shall
                thereafter be entitled, upon exercise of such Holder's
                conversion rights, to receive the kind and amount of shares of
                stock or other securities of the Corporation resulting from such
                consolidation or merger, or such other property, as the Holder
                would have received if such conversion rights were exercised
                immediately prior to the effectiveness of such merger or
                consolidation.

          (iii) In the event the Corporation at any time, or from time to time
                after December 31, 1999, makes or issues, or fixes a record date
                for the determination of holders of Common Stock entitled to
                receive, a dividend distribution payable in additional shares of
                Common Stock or Common Stock Equivalents (as defined which does
                not provide for the payment of any consideration upon the
                issuance, conversion or thereof, without a corresponding
                dividend or other distribution to the Holder, based upon the
                number of shares of Common Stock into which the Series IV Class
                B Preferred Stock is convertible, then and in each such event
                the Conversion Rate then in effect will be increased as of the
                time of such issuance or, in the event such a record date shall
                have been fixed, as of the close of business on such record
                date, by multiplying such Conversion rate by a fraction:

                (A) The numerator of which will be the total number of shares of
                    Common Stock issued and outstanding immediately prior to the
                    time of such issuance or the close of business on such
                    record date plus the number of shares of Common Stock
                    issuable in payment of such dividend or distribution (which,
                    in the case of Common Stock Equivalents, shall mean the
                    maximum number of shares of Common Stock issuable with
                    respect thereto, as set forth in the instrument relative
                    thereto without regard to any provision for subsequent
                    adjustment); and

                (B) The denominator of which will be the total number of shares
                    of Common Stock issued and outstanding immediately prior to
                    the time of such issuance or the close of business on such
                    record date; provided, however, that if such record date is
                    fixed and such dividend is not fully paid or if such
                    distribution is not fully made on the date fixed therefor,
                    the Conversion Rate will be recomputed accordingly as of the
                    close of business on such record date, and thereafter such
                    Conversion Rate will be adjusted pursuant to this
                    subparagraph (iii) as of the time of actual payment of such
                    dividends or distributions.

          (iv)  In the event the Corporation at any time or from time to time
                after December 31, 1999, makes or issues, or fixes a record date
                for the determination of holders of Common Stock entitled to
                receive a dividend or other distribution payable to all holders
                of Common Stock in securities of the Corporation or Common Stock
                Equivalents, then, upon making such dividend or distribution
                provisions will be made so that the Holder will receive the
                amount of securities of the Corporation which it would have
                received had its Series IV Class B Preferred Stock been
                converted into Common Stock on the date of such event.

          (v)   In the event the Corporation sells or issues any Common Stock,
                or sells or issues Common Stock Equivalents which can be
                converted into Common Stock at a per share consideration (as
                defined below in this subparagraph (v) of paragraph 6(f)) less
                than the Stipulated Price then in effect, then the Holder shall
                be entitled to purchase from the Corporation in cash (for the
                same per share consideration at

                                        6

<PAGE>

                 which such Common Stock was issued or the per share price at
                 which a share of Common Stock is acquirable upon exercise or
                 conversion of Common Stock Equivalents) that additional number
                 of shares of Common Stock which, when added to the number of
                 shares of Common Stock acquirable by the Holder upon conversion
                 of any shares of Series IV Class B Preferred Stock outstanding
                 and held by such Holder immediately before such issue or sale
                 (the "Acquirable Shares"), will equal a percentage of the
                 number of shares of Common Stock Deemed Outstanding (as defined
                 herein) immediately after such sale or issuance that is the
                 same as the percentage of the number of shares of Common Stock
                 Deemed Outstanding immediately before such issuance or sale
                 represented by the Acquirable Shares. This right shall exist
                 for a 45-day period following the sale or issuance of shares of
                 Common Stock or Common Stock Equivalents, and thereafter shall
                 cease to exist.

                 For the above purposes, the per share consideration with
                 respect to the sale or issuance of Common Stock will be the
                 price per share received by the Corporation, prior to the
                 payment of any expenses, commissions, discounts and other
                 applicable costs. With respect to the sale or issuance of
                 Common Stock Equivalents which are convertible into or
                 exchangeable for Common Stock without further consideration,
                 the per share consideration will be determined by dividing the
                 maximum number of shares of Common Stock issuable with respect
                 to such Common Stock Equivalents (as set forth in the
                 instrument relating thereto without regarding to any provisions
                 contained therein for subsequent adjustment of such number)
                 into the aggregate consideration receivable by the Corporation
                 upon the sale or issuance of such Common Stock Equivalents.
                 With respect to the issuance of other Common Stock Equivalents,
                 the per share consideration will be determined by dividing the
                 maximum number of shares of Common Stock issuable with respect
                 to such Common Stock Equivalents into the total aggregate
                 consideration received by the Corporation upon the sale or
                 issuance of such Common Stock Equivalents plus the minimum
                 aggregate amount of additional consideration received by the
                 Corporation upon the conversion or exercise of such Common
                 Stock Equivalents. In connection with the sale or issuance of
                 Common Stock and/or Common Stock Equivalents for non-cash
                 consideration, the amount of consideration will be the fair
                 market value of such consideration as determined in good faith
                 by the Board of Directors of the Corporation.

          (vi)   As used herein, the term "Stipulated Price" means initial price
                 of $10.00 per share of Common Stock, as adjusted from time to
                 time pursuant to subparagraph (viii) of this paragraph 6(f);
                 and the term "Common Stock Equivalent" means any securities
                 (whether debt or equity securities) or rights issued by the
                 Corporation convertible into or entitling the holder thereof to
                 receive shares of, or securities convertible into, Common
                 Stock. The number of shares of "Common Stock Deemed
                 Outstanding" at any date shall equal the sum of the number of
                 shares of Common Stock then outstanding plus the number of
                 shares of Common Stock then obtainable pursuant to Common Stock
                 Equivalents.

          (vii)  In the event the Corporation declares any dividend or
                 distribution payable to holders of its Common Stock (other than
                 dividends payable out of the Corporation's retained earnings or
                 earned surplus and dividends payable in shares of Common Stock
                 or in securities convertible into or exchangeable for shares of
                 Common Stock or rights or warrants to purchase Common Stock or
                 securities convertible into or exchangeable for shares of
                 Common Stock or any other securities issued by the
                 Corporation), the Conversion Rate in effect immediately prior
                 to the record date for such dividend or distribution shall be
                 proportionately adjusted so that the Holder shall be entitled
                 to receive the number of shares of Common Stock into which such
                 shares of Common Stock or

<PAGE>

                 Preferred Stock was convertible immediately prior to such
                 record date multiplied by a fraction, the numerator of which is
                 the fair market value of a share of Common Stock on such record
                 date and the denominator of which is such per share fair market
                 value of a share of Common Stock on such record date less the
                 fair market value on such record date of the securities or
                 other property which are distributed as a dividend or other
                 distribution. The term "fair market value" of a share of Common
                 Stock or of any other security or other type of property on any
                 date means (A) in the case of Common Stock or any other
                 security (I) if the principal trading market for such Common
                 Stock or other security is an exchange or the NASDAQ national
                 market on such date, the closing price on such exchange or the
                 NASDAQ national market on such date, provided, if trading of
                 such Common Stock or other security is listed on any
                 consolidated tape, the fair market value shall be the closing
                 price set forth on such consolidated tape on such date, or (II)
                 if the principal market for such Common Stock or other security
                 is the over-the-counter market (other than the NASDAQ national
                 market) the mean between the closing bid and asked prices on
                 such date as set forth by NASDAQ or (B) in the case of Common
                 Stock or any other security for which the fair market value
                 cannot be determined pursuant to clause (A) above or of any
                 other security or type of property, fair market value thereof
                 on such date as determined in good faith by the Board of
                 Directors.

          (viii) Whenever the Conversion Rate is adjusted pursuant to this
                 paragraph 6(f), the Stipulated Price shall also be adjusted by
                 multiplying it by a fraction that is the reciprocal of the
                 fraction used to adjust the Conversion Rate.

          (ix)   The Corporation will not, by amendment of its Articles of
                 Incorporation or through any dissolution, issuance or sale of
                 securities or any other voluntary action, avoid or seek to
                 avoid the observance or performance of any of the terms to be
                 observed or performed hereunder by the Corporation, but at all
                 times in good faith will assist in the carrying out of all the
                 provisions of this paragraph and in the taking of all such
                 action as may be necessary or appropriate in order to protect
                 the conversion rights of the Holder against impairment.

          (x)    No adjustment in the Conversion Rate shall be required, unless
                 such adjustment would require an increase or decrease of at
                 least one (1) share of Common Stock in the Conversion Rate of
                 one share of Series B Preferred Stock, provided that all
                 adjustments which do not meet this minimum requirement
                 cumulated and the adjustment will be made when the cumulated
                 total is sufficient to require an adjustment. All calculations
                 made pursuant to this subparagraph (x) of paragraph 6(f) shall
                 be made to the nearest one-hundredth (1/100th) of a share of
                 Common Stock.

     g.   Fractional Shares. No fractional shares of Common Stock or scrip
          representing fractional shares of Common Stock shall be issued upon
          any conversion of shares of Series IV Class B Preferred Stock but, in
          lieu thereof, there shall be paid an amount in cash equal to the same
          fraction of the current market price of a whole share of Common Stock
          on the day preceding the day of conversion.

     h.   Statement to Transfer Agent. Whenever the Conversion Rate for shares
          of Series IV Class B Preferred Stock shall be adjusted pursuant to the
          provisions of paragraph 6(f) hereof, the Corporation shall forthwith
          maintain at its office and, if applicable, file with the Transfer
          Agent for shares of Series IV Class B Preferred Stock and for shares
          of Common Stock, a statement signed by the President or a Vice
          President of the Corporation and by its Treasurer or an Assistant
          Treasurer, stating the adjusted Conversion Rate and setting forth in
          reasonable detail the method of calculation and the facts requiring
          such adjustment, such calculations to be confirmed by the
          Corporation's independent auditors, and stating the facts on which the
          calculation is based. Each adjustment shall remain in effect until a
          subsequent adjustment hereunder is required.

                                        8

<PAGE>

7. Registration Rights.

     a.   Piggyback Registration. The Corporation, for a period ending six
          months after the last share of Series IV Class B Preferred Stock is
          redeemed, retired, converted or otherwise no longer outstanding, will
          give written notice to the Holder not less than 20 days in advance of
          the initial filing of any registration statement under the Securities
          Act of 1933, as amended (other than a registration statement
          pertaining to securities issuable pursuant to employee stock option,
          stock purchase, or similar plans or a registration statement
          pertaining to securities issuable in connection with the acquisition
          of a business, whether through merger, consolidation, acquisition of
          assets, or exchange of securities), covering any Common Stock or other
          securities of the Corporation, and will afford the Holder the
          opportunity to have included in such registration all or such part of
          the shares of Common Stock acquired upon conversion of Series IV Class
          B Preferred Stock, as may be designated by written notice to the
          Corporation not later than 10 days following receipt of such notice
          from the Corporation. The Corporation shall be entitled to exclude the
          shares of Common Stock held by the Holder from any one, but not more
          than one, such registration if the Corporation in its sole discretion
          decides that the inclusion of such shares will materially interfere
          with the orderly sale and distribution of the securities being offered
          under such registration statement by the Corporation. Notwithstanding
          the foregoing, the Corporation shall not be entitled to exclude the
          shares of Common Stock held by the Holder if shares of other
          shareholders are being included in any such registration statement
          and, in such circumstances, the Holder shall be entitled to include
          the shares of Common Stock held by them on a pro rata basis in the
          proportion that the number of shares of Common Stock held by the
          Holder bears to the shares of Common Stock held by all other
          shareholders, including shares in such registration statement. The
          Holder shall not be entitled to include shares in more than two
          registration statements pursuant to the provisions of this subdivision
          (a) of paragraph 7, and all rights of the Holder under this
          subdivision (a) of paragraph 7 shall terminate after the Holder has
          included shares of Common Stock in two registration statements
          pursuant to this subdivision (a) of paragraph 7.

     b.   Expenses. The Corporation will pay all out-of-pocket costs and
          expenses of any registration effected pursuant to the provisions of
          subdivision (a) of this paragraph 7, including registration fees,
          legal fees, accounting fees, printing expenses (including such number
          of any preliminary and the final prospectus as may be reasonably
          requested), blue sky qualification fees and expenses, and all other
          expenses, except for underwriting commissions or discounts applicable
          to the shares of Common Stock being sold by the Holder and the fees of
          counsel for the Holder, all of which shall be paid by the Holder.

     c.   Notwithstanding anything to the contrary contained herein, in the
          event that the Corporation files an initial registration statement
          under the Securities Act of 1933, as amended (other than a
          registration statement pertaining to securities issuable in connection
          with the acquisition of a business, whether through merger,
          consolidation, acquisition of assets or exchange of securities),
          concerning any Common Stock of the Corporation, it will afford the
          Holder the opportunity to convert his shares into that number of fully
          paid and non-assessable shares of Common Stock prior to the 3-year
          holding period stated in paragraph 6 above. The Corporation may also,
          at its option at any time within one-hundred eighty (180) days after
          an initial registration statement is deemed effective, demand the
          conversion of the Series IV Class B Preferred Stock into that number
          of fully paid and nonassessable shares of Common Stock as provided
          herein.

                                        9

<PAGE>

8. Reports.

     So long as any of the Series IV Class B Preferred Stock shall be
     outstanding, the Corporation shall submit to the Holder financial reports
     no less frequently than annually.

9. Miscellaneous.

     a.   As used herein, the term "Common Stock" shall mean the Corporation's
          Common Stock, no par value, or, in the case of any reclassification or
          change of outstanding shares of Common Stock, the stock or securities
          issued in exchange for such Common Stock.

     b.   The shares of Series IV Class B Preferred Stock shall be fully
          transferable by the Holder thereof, subject to compliance with the
          applicable provisions of federal and state securities laws.

IN WITNESS WHEREOF, RETRACTABLE TECHNOLOGIES, INC. has caused its corporate seal
to be hereunto affixed and this Certificate to be signed by its Chief Executive
Officer and Secretary this 21/st/ day of January, 2000.

                                             /s/ Thomas J. Shaw
                                             ------------------------------
                                             THOMAS J. SHAW,
                                             Its: Chief Executive Officer

ATTEST:

/s/ Michele Larios
--------------------------
MICHELE LARIOS
Secretary

                                       10

<PAGE>

                                                                FILED
                                                         in the Office of the
                                                     Secretary of State of Texas

                                                             JUN 01 2001

                                                         Corporations Section



                         STATEMENT OF CHANGE OF ADDRESS

                               OF REGISTERED AGENT

                             BY A PROFIT CORPORATION

(1)  The name of the Corporation represented by the registered agent is
     Retractable Technologies, Inc.

(2)  The address, including street and number, at which such registered agent
     has maintained the registered office for the Corporation as shown in the
     records of the Secretary of State of Texas before filing this statement is
     2001 Bryan Tower, Suite 2700, Dallas, Texas 75201.

(3)  The new address, including street and number, at which such registered
     agent will thereafter maintain the registered office for said Corporation
     is 2600 San Jacinto Tower, 2121 San Jacinto Street, Dallas, Texas 75201.

(4)  Notice of the change has been given to the Corporation in writing at least
     ten (10) days prior to this filing.


Dated:  May 31, 2001.
                                            /s/ RALPH S. JANVEY
                                            ------------------------------------
                                            RALPH S. JANVEY
                                            REGISTERED AGENT


STATEMENT OF CHANGE OF ADDRESS OF
REGISTERED AGENT BY A PROFIT CORPORATION - Page Solo

<PAGE>

                                                             FILED
                                                        In the Office of
                                                 the Secretary of State of Texas
                                                          APR 19 2002
                                                      Corporations Section

         CERTIFICATE OF DESIGNATION, PREFERENCES, RIGHTS AND LIMITATIONS
               OF THE SERIES V CLASS B CONVERTIBLE PREFERRED STOCK
                                       OF
                         RETRACTABLE TECHNOLOGIES, INC.

Pursuant to Article 2.13 of the Texas Business Corporation Act and Article Four
of its Second Amended and Restated Articles of Incorporation (the "Articles of
Incorporation"), Retractable Technologies, Inc., a corporation organized and
existing under the laws of the State of Texas (the "Corporation"),

DOES HEREBY CERTIFY that, pursuant to the authority conferred upon the Board of
Directors of the Corporation by the Articles of Incorporation, as amended, and
pursuant to the Texas Business Corporation Act, said Board of Directors, on
April 15, 2002, at a meeting duly called and noticed adopted a resolution by all
necessary action on the part of the Corporation providing for the creation of a
series of Preferred Stock consisting of not more than 1,500,000 shares of Series
V Class B Convertible Preferred Stock, which resolution is and reads as follows:

RESOLVED that, pursuant to the authority provided in the Corporation's Articles
of Incorporation and expressly granted to and vested in the Board of Directors
of the Corporation, the Board of Directors hereby creates out of the Preferred
Stock, par value One Dollar ($1.00) per share, of the Corporation a series of
Preferred Stock called the Series V Class B Preferred Stock, consisting of
1,500,000 shares, which shall be subordinate to the Series A Convertible
Preferred and Series I through IV Class B Convertible Preferred Stock, and the
Board of Directors hereby fixes the designation and the powers, preference and
rights, and the qualifications, limitations, and restrictions thereof, to the
extent not otherwise provided in the Corporation's qualifications, limitations,
and restrictions thereof, to the extent not otherwise provided in the
Corporation's Articles of Incorporation, as follows:

1.   Designation of Series. The designation of the series of Preferred Stock
     created by this resolution shall be "Series V Class B Convertible Preferred
     Stock" (the "Series V Class B Preferred Stock").

2.   Dividends on Series V Class B Preferred Stock

     a.   Dividend Amount. The holders of the Series V Class B Preferred Stock
          shall be entitled to receive, in any calendar year, if, when, and as
          declared by the Board of Directors, out of any assets at the time
          legally available therefor and subject to the further limitations set
          out herein, dividends at the per annum rate of $.32 per share, all
          such dividends due quarterly in arrears as of the last day of each
          March, June, September, and December of each year, the first dividend
          being declarable on December 31, 2002. On each date which a dividend
          may be declared is hereafter called the "Dividend Date," and each
          quarterly period ending with a Dividend Date is hereinafter referred
          to as the "Dividend Period." Dividends shall be payable 15 calendar
          days after the Dividend Due Date; provided, however, that if such date
          on which a dividend is payable is a Saturday, Sunday, or legal
          holiday, such dividend shall be payable on the next following business
          day to the holders of record (whether singular or plural, the
          "Holder").

     b.   Dividends Cumulative. Dividends upon the Series V Class B Preferred
          Stock shall be accrued and be cumulative, whether or not in any
          Dividend Period or Periods there shall be funds of the Corporation
          legally available for the payment of such dividends.

     c.   Dividend Accrual. On each Dividend Due Date all dividends which shall
          have accrued since the last Dividend Due Date on each share of Series
          V Class B Preferred Stock outstanding on such Dividend Due Date shall
          accumulate and be deemed to become "due." Any dividend which shall not
          be paid on the Dividend Due Date on which it shall become due shall be
          deemed to be "past due" until such dividend shall be paid or until the
          share of Series V Class B Preferred Stock with respect to which such
          dividend became due shall no longer be outstanding, whichever is the
          earlier to occur. No interest, sum of money in lieu of interest, or
          other property or securities shall be payable in respect of any
          dividend payment or payments which are past due. Dividends paid
          on shares of Series V Class B Preferred Stock in an amount less than
          the total amount of such

                                       1

<PAGE>

          dividends at the time accumulated and payable on such shares shall be
          allocated pro rata on a share-by-share basis among all such shares at
          the time outstanding. Dividend payments made with respect to a
          Dividend Due Date shall be deemed to be made in payment of the
          dividends which became due on that Dividend Due Date.

     d.   Dividend Arrearage. If a dividend upon any shares of Series V Class B
          Preferred Stock is in arrears, all dividends or other distributions
          declared upon shares of the Series V Class B Preferred Stock (other
          than dividends paid in stock of the Corporation ranking junior to the
          Series V Class B Preferred Stock as to dividends and upon liquidation,
          dissolution, or winding up) may only be declared pro rata. Except as
          set forth above, if a dividend upon any shares of Series V Class B
          Preferred Stock is in arrears: (i) no dividends (in cash, stock, or
          other property) may be paid or declared and set aside for payment or
          any other distribution made upon any stock of the Corporation ranking
          junior to the Series V Class B Preferred Stock as to dividends (other
          than dividends of distributions in stock of the Corporation ranking
          junior to the Series V Class B Preferred Stock as to dividends and
          upon liquidation, dissolution, or winding up); and (ii) no stock of
          the Corporation ranking junior to the Series V Class B Preferred Stock
          as to dividends may be (A) redeemed pursuant to a sinking fund or
          otherwise, except (1) by means of redemption pursuant to which all
          outstanding shares of the Series V Class B Preferred Stock are
          redeemed, or (2) by conversion of any such junior stock into, or
          exchange of any such junior stock into, or exchange of any such junior
          stock for stock of the Corporation ranking junior to the Series V
          Class B Preferred Stock as to dividends and upon liquidation,
          dissolution, or winding up, or (B) purchased or otherwise acquired for
          any consideration by the Corporation except (1) pursuant to an
          acquisition made pursuant to the terms of one or more offers to
          purchase all of the outstanding shares of the Series V Class B
          Preferred Stock, which offers shall each have been accepted by the
          holders of at least 50% of the shares of the Series V Class B
          Preferred Stock receiving such offer outstanding at the commencement
          of the first of such purchase offers, or (2) by conversion into or
          exchange for stock of the Corporation ranking junior to the Series V
          Class B Preferred Stock as to dividends and upon liquidation or
          winding up.

3.   General, Class, and Series Voting Rights. Except as provided in this
     Section 3, or as otherwise from time to time required by law, the Series V
     Class B Preferred Stock shall have no voting rights.

     So long as any shares of Series V Class B Preferred Stock remain
     outstanding, the consent of the holders of at least 51% of the shares of
     Series V Class B Preferred Stock outstanding at the time voting separately
     as a class, given in person or by proxy, either in writing at any special
     or annual meeting called for the purpose, shall be necessary to permit,
     effect, or validate any one or more of the following:

     (i)  The authorization, creation, or issuance, or any increase in the
          authorized or issued amount, of any class or series of stock
          (including any class or series of Preferred Stock) ranking equal or
          prior to the Series V Class B Preferred Stock; or

     (ii) The amendment, alteration, or repeal, whether by merger,
          consolidation, or otherwise, of any of the provisions of the Articles
          of Incorporation or of this resolution which would alter or change the
          powers, preferences, or special rights of the shares of the Series V
          Class B Preferred Stock so as to affect them adversely; provided,
          however, that any increase in the amount of authorized Preferred
          Stock, or the creation and issuance of other series of Preferred Stock
          ranking junior to the Series V Class B Preferred Stock with respect to
          the payment of dividends and the distribution of assets upon
          liquidation, dissolution, or winding up, shall not be deemed to
          adversely affect such powers, preferences, or special rights.

     The foregoing voting provisions shall not apply if, at or prior to the time
     when the act with respect to which such vote would otherwise be required
     shall be effected, all outstanding shares of Series V Class B Preferred
     Stock shall have been redeemed or sufficient funds shall have been
     deposited in trust to effect such redemption.


                                       2

<PAGE>

     4.   Redemption. The outstanding shares of Series V Class B Preferred Stock
          shall be nonredeemable prior to the lapse of two (2) years from the
          date of issuance. On and after such date, the Series V Class B
          Preferred Stock may be redeemed at the option of the Corporation, as a
          whole at any time or in part from time to time, at the Redemption
          Price of $4.40 per share plus all dividends (whether or not declared
          or due) accrued and unpaid to the date of redemption (subject to the
          right of the holder of record of shares of Series V Class B Preferred
          Stock on a record date for the payment of a dividend on the Series V
          Class B Preferred Stock to receive the dividend due on such shares of
          Series V Class B Preferred Stock on the corresponding Dividend Due
          Date).

          No sinking fund shall be established for the Series V Class B
          Preferred Stock.

          Notice of any proposed redemption of shares of Series V Class B
          Preferred Stock shall be mailed by means of first class mail, postage
          paid, addressed to the holders of record of the shares of Series V
          Class B Preferred Stock to be redeemed, at their respective addresses
          then appearing on the books of the Corporation, at least thirty (30)
          days but not more than sixty (60) days prior to the date fixed for
          such redemption (herein referred to as the "Redemption Date"). Each
          such notice shall specify (i) the Redemption Date; (ii) the Redemption
          Price; (iii) the place for payment and for delivering the stock
          certificate(s) and transfer instrument(s) in order to collect the
          Redemption Price; (iv) the shares of Series V Class B Preferred Stock
          to be redeemed; and (v) the then effective Conversion Price (as
          defined below) and that the right of holders of shares of Series V
          Class B Preferred Stock being redeemed to exercise their conversion
          right shall terminate as to such shares at the close of business on
          the fifth day before the Redemption Date, provided that no default by
          the Corporation in the payment of the applicable Redemption Price
          (including any accrued and unpaid dividends) shall have occurred and
          be continuing. Any notice mailed in such manner shall be conclusively
          deemed to have been duly given whether or not such notice is, in fact,
          received. If less than all the outstanding shares of Series V Class B
          Preferred Stock are to be redeemed, the Corporation will select those
          to be redeemed by lot or by a substantially equivalent method. In
          order to facilitate the redemption of Series V Class B Preferred Stock
          to be redeemed, notice of any such proposed redemption shall not be
          more than sixty (60) days prior to the Redemption Date with respect
          thereto.

          The holder of any shares of Series V Class B Preferred Stock redeemed
          upon any exercise of the Corporation's redemption right shall not be
          entitled to receive payment of the Redemption Price for such shares
          until such holder shall cause to be delivered to the place specified
          in the notice given with respect to such redemption (i) the
          certificate(s) representing such shares of Series V Class B Preferred
          Stock; and (ii) transfer instrument(s) satisfactory to the Corporation
          and sufficient to transfer such shares free of any adverse interest.
          No interest shall accrue on the Redemption Price of any share of
          Series V Class B Preferred Stock after its Redemption Date.

          Subject to Section 2 hereof, the Corporation shall have the right to
          purchase shares of Series V Class B Preferred Stock from the owner of
          such shares on such term as may be agreeable to such owner. Shares of
          Series V Class B Preferred Stock may be acquired by the Corporation
          from any stockholder pursuant to this paragraph without offering any
          other stockholder an equal opportunity to sell his stock to the
          Corporation, and no purchase by the Corporation from any stockholder
          pursuant to this paragraph shall be deemed to create any right on the
          part of any stockholder to sell any shares of Series V Class B
          Preferred Stock (or any other stock) to the Corporation.

          Notwithstanding the foregoing provisions of this Section 4, and
          subject to the provisions of Section 2 hereof, if a dividend upon any
          shares of Series V Class B Preferred Stock is past due, no shares of
          the Series V Class B Preferred Stock may be redeemed, except (i) by
          means of a redemption pursuant to which all outstanding shares of the
          Series V Class B Preferred Stock are simultaneously redeemed (or
          offered to be so redeemed) or pursuant to which the outstanding shares
          of the Series V Class B Preferred Stock are redeemed on a pro rata
          basis (or offered to be so redeemed), or (ii) by conversion of shares
          of Series V Class B Preferred Stock into, or exchange of such shares
          for, Common Stock or any other stock of the

                                       3

<PAGE>

          Corporation ranking junior to the Series V Class B Preferred Stock as
          to dividends and upon liquidation, dissolution, or winding up.

     5.   Liquidation. In the event of any voluntary or involuntary dissolution,
          liquidation, or winding up of the Corporation (for the purposes of
          this Section 5, a "Liquidation"), before any distribution of assets
          shall be made to the holders of the Common Stock or the holders of any
          other stock that ranks junior to the Series V Class B Preferred Stock
          in respect of distributions upon the Liquidation of the Corporation,
          the holder of each share of Series V Class B Preferred Stock then
          outstanding shall be entitled to $4.40 per share plus all dividends
          (whether or not declared or due) accrued and unpaid on such share on
          the date fixed for the distribution of assets of the Corporation to
          the holders of Series V Class B Preferred Stock.

          If upon any Liquidation of the Corporation, the assets available for
          distribution to the holder of Series V Class B Preferred Stock which
          shall then be outstanding (hereinafter in this paragraph called the
          "Total Amount Available") shall be insufficient to pay the holders of
          all outstanding shares of Series V Class B Preferred Stock the full
          amounts (including all dividends accrued and unpaid) to which they
          shall be entitled by reason of such Liquidation of the Corporation,
          then there shall be paid ratably to the holders of the Series V Class
          B Preferred Stock in connection with such Liquidation of the
          Corporation, an amount equal to each holder's pro rata share of the
          Total Amount Available.

          The voluntary sale, conveyance, lease, exchange, or transfer of all or
          substantially all the property or assets of the Corporation, or the
          merger or consolidation of the Corporation into another Corporation,
          or any purchase or redemption of some or all of the shares of any
          class or series of stock of the Corporation, shall not be deemed to be
          a Liquidation of the Corporation for the purposes of this Section 5
          (unless in connection therewith the Liquidation of the Corporation is
          specifically approved).

     6.   Conversion Privilege. At any time after issuance of any share of
          Series V Class B Preferred Stock, the holder of any share of Series V
          Class B Preferred Stock ("Holder") shall have the right, at such
          Holder's option (but if such share is called for redemption or
          exchange at the election of the Corporation, then in respect of such
          share only to and including but not after the close of business on (i)
          the fifth calendar day before the date fixed for such redemption; or
          (ii) the date fixed for such exchange, provided that the Corporation
          has set aside funds sufficient to effect such redemption) to convert
          such share into that number of fully paid and nonassessable shares of
          Common Stock (calculated as to each conversion to the nearest 1/100th
          of a share) obtained by dividing $4.00 by the Conversion Rate then in
          effect.

          a.   Conversion Rate. Each share of Series V Class B Preferred Stock
               may be converted, subject to the terms and provisions of this
               paragraph 6 into one (1) share of the Corporation's Common Stock,
               which is a price equal to one share of Common Stock for each
               $4.00 of Series V Class B Preferred Stock or, in case an
               adjustment of such rate has taken place pursuant to the
               provisions of subdivision (f) of this paragraph 6, then at the
               Conversion Rate as last adjusted (such rate or adjusted rate,
               shall be expressed as the number of shares of Common Stock to be
               acquired upon conversion of one share of Series V Class B
               Preferred Stock, and shall be referred to herein as the
               "Conversion Rate") ("Conversion Price"). Each share of Series V
               Class B Preferred Stock shall be Convertible into Common Stock by
               surrender to the Corporation of the certificate representing such
               shares of Series V Class B Preferred Stock to be converted by the
               Holder and by giving written notice to the Corporation of the
               Holder's election to convert.

               The Corporation shall, as soon as practicable after receipt of
               such written notice and the proper surrender to the Corporation
               of the certificate or certificates representing shares of Series
               V Class B Preferred Stock to be converted in accordance with the
               above provisions, issue and deliver for the benefit of the Holder
               at the office of the Corporation's duly appointed transfer agent
               (the "Transfer Agent") to the Holder for whose account such
               shares of Series V Class B Preferred Stock were so surrendered or
               to such Holder's nominee or nominees, certificates for the number
               of shares of Common Stock to which the Holder shall be entitled.
               The certificates of Common Stock of the Corporation issued upon
               conversion shall bear such legends as may be required by state or

                                       4

<PAGE>

               federal laws. Such conversion shall be deemed to have been
               effective immediately prior to the close of business on the date
               on which the Corporation shall have received both such written
               notice and the properly surrendered certificates for shares of
               Series V Class B Preferred Stock to be converted (the "Conversion
               Date"), and at such time the rights of the Holder shall cease and
               the person or persons entitled to receive the shares of Common
               Stock issuable upon the conversion of such shares of Series V
               Class B Preferred Stock shall be deemed to be, and shall be
               treated for all purposes as, the record Holder or Holders of such
               Common Stock on the Conversion Date. The Corporation shall not be
               required to convert, and no surrender of shares of Series V Class
               B Preferred Stock or written notice of conversion with respect
               thereto shall be effected for that purpose, while the stock
               transfer books of the Corporation are closed for any reasonable
               business purpose for any reasonable period of time, but shall be
               required to convert upon the proper surrender of shares of Series
               V Class B Preferred Stock for conversion immediately upon the
               reopening of such books. During the period in which the stock
               transfer books of the Corporation are closed, the Corporation may
               neither declare a dividend, declare a record date for payment of
               dividends, nor make any payment of dividends.

          b.   Dividends. If any shares of Series V Class B Preferred Stock
               shall be converted during any dividend payment period, the Holder
               shall be entitled to all dividends accrued up to and through such
               Conversion Date, at the rate set forth herein, whether or not
               there has been a dividend date, as set forth in paragraph 2
               hereof.

          c.   Cancellation. Series V Class B Preferred Stock converted into
               Common Stock pursuant to the provisions of this paragraph 6 shall
               be retired by the Corporation and given the status of authorized
               and unissued Preferred Stock.

          d.   Reissuance if Conversion is Partial. In the case of any
               certificate representing shares of Series V Class B Preferred
               Stock which is surrendered for conversion only in part, the
               Corporation shall issue and deliver to the Holder a new
               certificate or certificates for Series V Class B Preferred Stock
               in the amount of Series V Class B Preferred Stock equal to the
               unconverted shares of the Series V Class B Preferred Stock
               represented by the certificate so surrendered.

          e.   Reservations of Shares. The Corporation shall at all times during
               which shares of Series V Class B Preferred Stock may be converted
               into Common Stock as provided in this paragraph (e), reserve and
               keep available, out of any Common Stock held as treasury stock or
               out of its authorized and unissued Common Stock, or both, solely
               for the purpose of delivery upon conversion of the shares of
               Series V Class B Preferred Stock as herein provided, such number
               of shares of Common Stock as shall then be sufficient to effect
               the conversion of all shares of Series V Class B Preferred Stock
               from time to time outstanding, and shall take such action as may
               from time to time be necessary to ensure that such shares of
               Common Stock will, when issued upon conversion of Series V Class
               B Preferred Stock, be fully paid and nonassessable.

          f.   Adjustment of Conversion Rate. The Conversion Rate provided in
               subdivision (a) of this paragraph 6, in respect of Series V Class
               B Preferred Stock, shall be subject to adjustments from time to
               time as follows:

               (i)  While any shares of Series V Class B Preferred Stock shall
                    be outstanding, in case the Corporation shall subdivide the
                    outstanding shares of Common Stock into a greater number of
                    shares of Common Stock or combine the outstanding shares of
                    Common Stock into a smaller number of shares of Common
                    Stock, or issue, by reclassification of its shares of Common
                    Stock, any shares of the Corporation, the Conversion Rate in
                    effect immediately prior thereto shall be adjusted so that
                    the Holder shall be entitled to receive the number of shares
                    which it would have owned or been entitled to receive after
                    the happening of any of the events described above, had such
                    shares of Series V Class B Preferred Stock been converted
                    immediately prior to the happening of such event, such

                                       5

<PAGE>

                    adjustment to become effective immediately after the opening
                    of business on the day following the day upon which such
                    subdivision or combination or reclassification, as the case
                    may be, becomes effective.

              (ii)  In case the Corporation shall be consolidated with, or merge
                    into, any other corporation, and the Corporation does not
                    survive, proper provisions shall be made as a part of the
                    terms of such consolidation or merger, whereby the Holder
                    shall thereafter be entitled, upon exercise of such Holder's
                    conversion rights, to receive the kind and amount of shares
                    of stock or other securities of the Corporation resulting
                    from such consolidation or merger, or such other property,
                    as the Holder would have received if such conversion rights
                    were exercised immediately prior to the effectiveness of
                    such merger or consolidation.

              (iii) In the event the Corporation at any time makes or issues, a
                    record date for the determination of holders of Common Stock
                    entitled to receive, a dividend distribution payable in
                    additional shares of Common Stock or Common Stock
                    Equivalents (as defined in subparagraph (iv) of this
                    paragraph 6(f)) which does not provide for the payment of
                    any consideration upon the issuance, conversion or thereof,
                    without a corresponding dividend or other distribution to
                    the Holder, based upon the number of shares of Common Stock
                    into which the Series V Class B Preferred Stock is
                    convertible, then and in each such event the Conversion Rate
                    then in effect will be increased as of the time of such
                    issuance or, in the event such a record date shall have been
                    fixed, as of the close of business on such record date, by
                    multiplying such Conversion rate by a fraction:

                    (A)  The numerator of which will be the total number of
                         shares of Common Stock issued and outstanding
                         immediately prior to the time of such issuance or the
                         close of business on such record date plus the number
                         of shares of Common Stock issuable in payment of such
                         dividend or distribution (which, in the case of Common
                         Stock Equivalents, shall mean the maximum number of
                         shares of Common Stock issuable with respect thereto,
                         as set forth in the instrument relative thereto without
                         regard to any provision for subsequent adjustment); and

                    (B)  The denominator of which will be the total number of
                         shares of Common Stock issued and outstanding
                         immediately prior to the time of such issuance or the
                         close of business on such record date; provided,
                         however, that if such record date is fixed and such
                         dividend is not fully paid or if such distribution is
                         not fully made on the date fixed therefor, the
                         Conversion Rate will be recomputed accordingly as of
                         the close of business on such record date, and
                         thereafter such Conversion Rate will be adjusted
                         pursuant to this subparagraph (iii) as of the time of
                         actual payment of such dividends or distributions.

              (iv)  In the event the Corporation at any time makes or issues, or
                    fixes a record date for the determination of holders of
                    Common Stock entitled to receive a dividend or other
                    distribution payable to all holders of Common Stock in
                    securities of the Corporation or Common Stock Equivalents,
                    then, upon making such dividend or distribution, provisions
                    will be made so that the Holder will receive the amount of
                    securities of the Corporation which it would have received
                    had its Series V Class B Preferred Stock been converted into
                    Common Stock on the date of such event.

              (v)   In the event the Corporation sells or issues any Common
                    Stock, or sells or issues Common Stock Equivalents which can
                    be converted into Common Stock at a per share consideration
                    (as defined below in this subparagraph (v) of paragraph
                    6(f)) less than the Stipulated Price then in effect, then
                    the Holder shall be entitled to purchase from the
                    Corporation in cash (for the same per share consideration at
                    which such Common Stock

                                        6

<PAGE>

                    was issued or the per share price at which a share of Common
                    Stock is acquirable upon exercise or conversion of Common
                    Stock Equivalents) that additional number of shares of
                    Common Stock which, when added to the number of shares of
                    Common Stock acquirable by the Holder upon conversion of any
                    shares of Series V Class B Preferred Stock outstanding and
                    held by such Holder immediately before such issue or sale
                    (the "Acquirable Shares"), will equal a percentage of the
                    number of shares of Common Stock Deemed Outstanding (as
                    defined herein) immediately after such sale or issuance that
                    is the same as the percentage of the number of shares of
                    Common Stock Deemed Outstanding immediately before such
                    issuance or sale represented by the Acquirable Shares. This
                    right shall exist for a 45-day period following the sale or
                    issuance of shares of Common Stock or Common Stock
                    Equivalents, and thereafter shall cease to exist.

                    For the above purposes, the per share consideration with
                    respect to the sale or issuance of Common Stock will be the
                    price per share received by the Corporation, prior to the
                    payment of any expenses, commissions, discounts and other
                    applicable costs. With respect to the sale or issuance of
                    Common Stock Equivalents which are convertible into or
                    exchangeable for Common Stock without further consideration,
                    the per share consideration will be determined by dividing
                    the maximum number of shares of Common Stock issuable with
                    respect to such Common Stock Equivalents (as set forth in
                    the instrument relating thereto without regard to any
                    provisions contained therein for subsequent adjustment of
                    such number) into the aggregate consideration receivable by
                    the Corporation upon the sale or issuance of such Common
                    Stock Equivalents. With respect to the issuance of other
                    Common Stock Equivalents, the per share consideration will
                    be determined by dividing the maximum number of shares of
                    Common Stock issuable with respect to such Common Stock
                    Equivalents into the total aggregate consideration received
                    by the Corporation upon the sale or issuance of such Common
                    Stock Equivalents plus the minimum aggregate amount of
                    additional consideration received by the Corporation upon
                    the conversion or exercise of such Common Stock Equivalents.
                    In connection with the sale or issuance of Common Stock
                    and/or Common Stock Equivalents for noncash consideration,
                    the amount of consideration will be the fair market value of
                    such consideration as determined in good faith by the Board
                    of Directors of the Corporation.

              (vi)  As used herein, the term "Stipulated Price" means initial
                    price of $4.00 per share of Common Stock, as adjusted from
                    time to time pursuant to subparagraph (viii) of this
                    paragraph 6(f); and the term "Common Stock Equivalent" means
                    any securities (whether debt or equity securities) or rights
                    issued by the Corporation convertible into or entitling the
                    holder thereof to receive shares of, or securities
                    convertible into, Common Stock. The number of shares of
                    "Common Stock Deemed Outstanding" at any date shall equal
                    the sum of the number of shares of Common Stock then
                    outstanding plus the number of shares of Common Stock then
                    obtainable pursuant to Common Stock Equivalents.

              (vii) In the event the Corporation declares any dividend or
                    distribution payable to holders of its Common Stock (other
                    than dividends payable out of the Corporation's retained
                    earnings or earned surplus and dividends payable in shares
                    of Common Stock or in securities convertible into or
                    exchangeable for shares of Common Stock or rights or
                    warrants to purchase Common Stock or securities convertible
                    into or exchangeable for shares of Common Stock or any other
                    securities issued by the Corporation), the Conversion Rate
                    in effect immediately prior to the record date for such
                    dividend or distribution shall be proportionately adjusted
                    so that the Holder shall be entitled to receive the number
                    of shares of Common Stock into which such shares of Common
                    Stock or Preferred Stock was convertible immediately prior
                    to such record date multiplied by a fraction, the numerator
                    of which is the fair market value of a share of Common Stock
                    on such record date and the denominator of which is such per
                    share fair

                                        7

<PAGE>

                    market value of a share of Common Stock on such record date
                    less the fair market value on such record date of the
                    securities or other property which are distributed as a
                    dividend or other distribution. The term "fair market value"
                    of a share of Common Stock or of any other security or other
                    type of property on any date means (A) in the case of Common
                    Stock or any other security (I) if the principal trading
                    market for such Common Stock or other security is an
                    exchange or the NASDAQ national market on such date, the
                    closing price on such exchange or the NASDAQ national market
                    on such date, provided, if trading of such Common Stock or
                    other security is listed on any consolidated tape, the fair
                    market value shall be the closing price set forth on such
                    consolidated tape on such date, or (II) if the principal
                    market for such Common Stock or other security is the
                    over-the-counter market (other than the NASDAQ national
                    market) the mean between the closing bid and asked prices on
                    such date as set forth by NASDAQ or (B) in the case of
                    Common Stock or any other security for which the fair market
                    value cannot be determined pursuant to clause (A) above or
                    of any other security or type of property, fair market value
                    thereof on such date as determined in good faith by the
                    Board of Directors.

             (viii) Whenever the Conversion Rate is adjusted pursuant to this
                    paragraph 6(f), the Stipulated Price shall also be adjusted
                    by multiplying it by a fraction that is the reciprocal of
                    the fraction used to adjust the Conversion Rate.

             (ix)   The Corporation will not, by amendment of its Articles of
                    Incorporation or through any dissolution, issuance, or sale
                    of securities or any other voluntary action, avoid or seek
                    to avoid the observance or performance of any of the terms
                    to be observed or performed hereunder by the Corporation,
                    but at all times in good faith will assist in the carrying
                    out of all the provisions of this paragraph and in the
                    taking of all such action as may be necessary or appropriate
                    in order to protect the conversion rights of the Holder
                    against impairment.

             (x)    No adjustment in the Conversion Rate shall be required,
                    unless such adjustment would require an increase or decrease
                    of at least one (1) share of Common Stock in the Conversion
                    Rate of one share of Series V Class B Preferred Stock,
                    provided that all adjustments which do not meet this minimum
                    requirement cumulated and the adjustment will be made when
                    the cumulated total is sufficient to require an adjustment.
                    All calculations made pursuant to this subparagraph (x) of
                    paragraph 6(f) shall be made to the nearest 1/100th of a
                    share of Common Stock.

     g.      Fractional Shares. No fractional shares of Common Stock or scrip
             representing fractional shares of Common Stock shall be issued upon
             any conversion of shares of Series V Class B Preferred Stock but,
             in lieu thereof, there shall be paid an amount in cash equal to the
             same fraction of the current market price of a whole share of
             Common Stock on the day preceding the day of conversion.

     h.      Statement to Transfer Agent. Whenever the Conversion Rate for
             shares of Series V Class B Preferred Stock shall be adjusted
             pursuant to the provisions of paragraph 6(f) hereof, the
             Corporation shall forthwith maintain at its office and, if
             applicable, file with the Transfer Agent for shares of Series V
             Class B Preferred Stock and for shares of Common Stock, a statement
             signed by the President of the Corporation and by its Treasurer,
             stating the adjusted Conversion Rate and setting forth in
             reasonable detail the method of calculation and the facts requiring
             such adjustment, such calculations to be confirmed by the
             Corporation's independent Accountants, and stating the facts on
             which the calculation is based. Each adjustment shall remain in
             effect until a subsequent adjustment hereunder is required.

7.   Registration Rights

                                        8

<PAGE>

     a.   Piggyback Registration. The Corporation, for a period ending six
          months after the last share of Series V Class B Preferred Stock is
          redeemed, retired, converted, or otherwise no longer outstanding, will
          give written notice to the holder not less than 20 days in advance of
          the initial filing of any registration statement under the Securities
          Act of 1933, as amended (other than a registration statement
          pertaining to securities issuable pursuant to employee stock option,
          stock purchase, or similar plans or a registration statement
          pertaining to securities issuable in connection with the acquisition
          of a business, whether through a merger, consolidation, acquisition of
          assets, or exchange of securities), covering any Common Stock or other
          securities of the Corporation, and will afford the holder the
          opportunity to have included in such registration all or such part of
          the shares of Common Stock acquired upon conversion of Series V Class
          B Preferred Stock, as may be designated by written notice to the
          Corporation not later than ten days following receipt of such notice
          from the Corporation. The Corporation shall be entitled to exclude the
          shares of Common Stock held by the holder from any one, but not more
          than one, such registration if the Corporation in its sole discretion
          decides that the inclusion of such shares will materially interfere
          with the orderly sale and distribution of the securities being offered
          under such registration statement by the Corporation. Notwithstanding
          the foregoing, the Corporation shall not be entitled to exclude the
          shares of Common Stock held by the Holder if shares of other
          shareholders are being included in any such registration statement
          and, in such circumstances, the Holder shall be entitled to include
          the shares of Common Stock held by them on a pro-rata basis in the
          proportion that the number of shares of Common Stock held by the
          Holder bears to the shares of Common Stock held by all other
          shareholders, including shares in such registration statement. The
          Holder shall not be entitled to include shares in more than two
          registration statements pursuant to the provisions of this subdivision
          (a) of paragraph 7, and all rights of the Holder under this
          subdivision (a) of paragraph 7 shall terminate after the Holder has
          included shares of Common Stock in two registration statements
          pursuant to this subdivision (a) of paragraph 7.

     b.   Expenses. The Corporation will pay all out-of-pocket costs and
          expenses of any registration effected pursuant to the provisions of
          subdivision (a) of this paragraph 7, including registration fees,
          legal fees, accounting fees, printing expenses (including such number
          of any preliminary and the final prospectus as may be reasonably
          requested), blue sky qualification fees and expenses, and all other
          expenses, except for underwriting commissions or discounts applicable
          to the shares of Common Stock being sold by the Holder and the fees of
          counsel for the Holder, all of which shall be paid by the Holder.

     c.   Notwithstanding anything to the contrary contained herein, in the
          event that the Corporation files an initial registration statement
          under the Securities Act of 1933, as amended (other than a
          registration statement pertaining to securities issuable in connection
          with the acquisition of a business, whether through merger,
          consolidation, acquisition of assets, or exchange of securities),
          concerning any Common Stock of the Corporation, it may, at its option,
          at any time within 180 days after the initial registration statement
          is deemed effective, demand the conversion of the Series V Class B
          Convertible Preferred shares into that number of fully paid and
          nonassessable shares of Common Stock as provided herein.

8.   Reports

     So long as any of the Series V Class B Preferred Stock shall be
     outstanding, the Corporation shall submit to the Holder financial reports
     no less frequently than annually.

9.   Miscellaneous

     a.   As used herein, the term "Common Stock" shall mean the Corporation's
          Common Stock, no par value, or, in the case of any reclassification or
          change of outstanding shares of Common Stock, the stock or securities
          issued in exchange for such Common Stock.

                                        9

<PAGE>

          b.   The shares of Series V Class B Preferred Stock shall be fully
               transferable by the Holder thereof, subject to compliance with
               the applicable provisions of federal and state securities laws.

                                       10

<PAGE>

IN WITNESS WHEREOF, RETRACTABLE TECHNOLOGIES, INC. has caused its corporate seal
to be hereunto affixed and this Certificate to be signed by its Chief Executive
Officer and Secretary this 17 day of April, 2002.

                                             /s/ Thomas J. Shaw
                                             -----------------------------------
                                             THOMAS J. SHAW,
                                             Its: Chief Executive Officer

ATTEST:

/s/ Michelle M. Larios
--------------------------
MICHELE M. LARIOS
Secretary

                                       11

<PAGE>

                                     FILED
                              in the Office of the
                          Secretary of State of Texas

                   STATEMENT OF INCREASE IN AUTHORIZED SHARES

                 OF SERIES V CLASS B CONVERTIBLE PREFERRED STOCK

                                       OF

                         RETRACTABLE TECHNOLOGIES, INC.

Pursuant to Article 2.13 of the Texas Business Corporation Act and Article Four
of its Second Amended and Restated Articles of Incorporation (the "Articles of
Incorporation"), Retractable Technologies, Inc., a corporation organized and
existing under the laws of the State of Texas (the "Corporation"),

DOES HEREBY CERTIFY that, pursuant to the authority conferred upon the Board of
Directors of the Corporation by the Articles of Incorporation, and pursuant to
the Texas Business Corporation Act, said Board of Directors, on June 20, 2002,
at a meeting duly called and noticed, adopted a resolution by all necessary
action on the part of the Corporation, providing for the increasing of the
authorized number of shares of Series V Class B Convertible Preferred Stock to
consist of not more than 3,097,855 shares, which resolution is and reads as
follows:

RESOLVED that the Officers are hereby authorized and directed to take all
actions necessary to increase the authorized number of shares of Series V Stock
of the Corporation to not more than 3,097,855 shares.

IN WITNESS WHEREOF, RETRACTABLE TECHNOLOGIES, INC. has caused its corporate seal
to be hereunto affixed and this Statement to be signed by its Chief Executive
Officer and Secretary this 20th day of June, 2002.


                                        /s/ THOMAS J. SHAW
                                        -------------------------------
                                        THOMAS J. SHAW,
                                        Its: Chief Executive Officer

ATTEST:

/s/ MICHELE M. LARIOS
-------------------------
MICHELE M. LARIOS
Secretary