Exhibit 3.3

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

            Certificate to Provide for the Designation, Preferences,
                     Rights, Qualifications, Limitations or
            Restrictions Thereof, of the Series A-1 Preferred Stock,
                        Non-Redeemable Convertible Series

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

         Williams Controls,  Inc., a Delaware  corporation (the  "Corporation"),
hereby certifies that pursuant to the authority vested in the Board of Directors
of the Corporation by the provisions of its Certificate of Incorporation, and by
the  provisions  of Section 151 of The General  Corporation  Law of the State of
Delaware, the Board of Directors adopted the following resolution:

         RESOLVED, there is hereby created a series of preferred stock, $.01 par
         value,  of  the  Corporation,   consisting  of  80,000  shares  of  the
         authorized, but unissued preferred stock and designated the "Series A-1
         Preferred  Stock"  (hereinafter  referred to as the "Series A-1");  and
         that to the  extent  that  the  terms,  relative  rights,  preferences,
         qualifications  and  limitations  of the  Series  A-1 are not fixed and
         determined by the Certificate of Incorporation  of the Corporation,  as
         amended,  they  hereby  are  fixed  and  determined  as  set  forth  in
         Attachment A attached hereto.

I, being the duly authorized officer of the Corporation, do hereby certify under
penalty of perjury that the foregoing resolution amending the Williams Controls,
Inc.  Certificate of Incorporation to provide for the designation,  preferences,
rights,  qualifications,  limitations or restrictions thereof, of the Series A-1
Preferred Stock,  Non-Redeemable  Convertible  Series is the act and deed of the
Corporation  and that the facts stated  herein are true and,  accordingly,  have
hereunto set my hand this 15th day of July, 2002.

                              /s/ ________________
                              -----------------------
                              Dennis E. Bunday
                              Chief Financial Officer, Treasurer and Secretary
                              Williams Controls, Inc.

<PAGE>
                          -----------------------------

            Certificate to Provide for the Designation, Preferences,
          Rights, Qualifications, Limitations or Restrictions Thereof,
                       of the Series A-1 Preferred Stock,
                        Non-Redeemable Convertible Series

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

SECTION  1.  DESIGNATION,  PAR VALUE AND  NUMBER.  80,000  shares of  authorized
preferred  stock of the  Corporation  are  hereby  constituted  as a  series  of
preferred  stock,  having a par value of $0.01 per share,  designated as "Series
A-1 Preferred  Stock,  Non-Redeemable  Convertible  Series"  hereinafter  called
"Series  A-1". In  accordance  with the terms  hereof,  each share of Series A-1
shall have the same  relative  rights as and be identical  in all respects  with
each other share of Series A-1.

SECTION 2. DIVIDENDS

    (a) Dividends.  When and as declared by the Corporation's Board of Directors
and to the  extent  permitted  under  the  General  Corporation  Law of State of
Delaware,  the  Corporation  shall  pay  preferential  dividends  in cash to the
holders  of shares of Series  A-1 as  provided  in this  Section  2.  Cumulative
preferential dividends on each share of Series A-1 shall accrue on a daily basis
on the sum of $100 from and  including the date of issuance of such share to and
including September 30, 2002 at rate sufficient to cause $18.219 of dividends to
have  accrued  on each  share of  Series  A-1 as of  September  30,  2002.  Such
dividends shall accrue whether or not they have been declared and whether or not
there are profits,  surplus or other funds of the Corporation  legally available
for the payment of dividends. The date on which the Corporation initially issues
any share shall be deemed to be its "date of issuance"  regardless of the number
of times  transfer of such share is made on the stock  records  maintained by or
for the Corporation  and regardless of the number of  certificates  which may be
issued to evidence such share.  Except as provided in Section 2(b), no dividends
shall accrue on the Series A-1 after September 30, 2002.

    (b) Participating  Dividends.  In the event that the Corporation declares or
pays any dividends upon the Common Stock (as defined below) (whether  payable in
cash, securities or other property),  the Corporation shall also declare and pay
to the holders of the Series A-1 at the same time that it declares and pays such
dividends to the holders of the Common  Stock,  the  dividends  which would have
been declared and paid with respect to the Common Stock issuable upon conversion
of the Series A-1 had all of the outstanding  Series A-1 been converted pursuant
to Section 4 immediately  prior to the record date for such  dividend,  or if no
record date is fixed,  the date as of which the record  holders of Common  Stock
entitled  to  such  dividends  are  to  be  determined.  "Common  Stock"  means,
collectively,  the Corporation's Common Stock, par value $.01 per share, and any
capital stock of any class of the Corporation  hereafter authorized which is not
limited to a fixed sum or  percentage  of par or stated  value in respect to the
rights of the holders thereof to participate in dividends or in the distribution
of assets upon any liquidation, dissolution or winding up of the Corporation.

    (c) Distribution of Partial Dividend Payments.  Except as otherwise provided
herein,  if at any time the  Corporation  pays  less  than the  total  amount of
dividends  then accrued with  respect to the Series A-1,  such payment  shall be
distributed pro rata among the holders thereof based upon the aggregate  accrued
but unpaid dividends on the shares held by each such holder.

SECTION 3. PRIORITY. All shares of the Series A-1 shall rank on a parity with
each other, shall be senior to all classes of Common Stock and the Corporation's
Series A Preferred Stock, 7 1/2% Redeemable
<PAGE>
Convertible   Series  (the  "Series  A")  and  shall  be   subordinate   to  the
Corporation's  Series B Preferred Stock, 15% Redeemable  Convertible Series (the
"Series B") and each other class or series of preferred stock of the Corporation
hereafter  created by the Board of Directors the terms of which do not expressly
provide  that it ranks on parity with or  subordinate  to the Series A-1, in all
cases as to the payment of dividends  (other than as set forth in Section  2(b))
and the distribution of assets upon the  liquidation,  dissolution or winding up
of the Corporation.

SECTION 4. VOLUNTARY CONVERSION RIGHTS.

    (a) Voluntary Conversion. Each holder of shares of Series A-1 shall have the
right at any time  from  time to time  after the first to occur of (i) the third
anniversary (the "Third  Anniversary") of the date (the "Funding Date") that the
closing of the  transactions  contemplated  by that  certain  Series B Preferred
Stock Purchase  Agreement,  by and among the Corporation and certain  investors,
occurs, and (ii) a Change of Control (as defined below), at the holder's option,
to  convert  all or any  portion  of such  holder's  shares of Series A-1 into a
number of validly  issued,  fully paid and  non-assessable  shares of Conversion
Stock (as defined below) of the  Corporation  computed by multiplying the number
of shares to be  converted  by the sum of $100 per share plus accrued and unpaid
dividends on such share (the "Liquidation Preference"),  and dividing the result
by the Voluntary  Conversion  Price (as defined  below) in effect at the time of
conversion;  provided, however, that holders of shares of Series A-1 may convert
their shares pursuant to this Section 4 prior to the first to occur of the Third
Anniversary and a Change of Control only if the average of the closing bid price
of the  Conversion  Stock as listed on the over the counter  bulletin board (the
"OTC Bulletin Board") or wherever the Corporation's Conversion Stock then trades
for at least twelve of the last thirteen  consecutive weeks prior to the date of
voluntary  conversion,  shall be greater  than or equal to $1.00 per share.  The
initial  Voluntary  Conversion Price is $.66. The "Voluntary  Conversion  Price"
means the  initial  Voluntary  Conversion  Price as  adjusted  from time to time
pursuant  to  Section  6.  "Change  of  Control"   means  the  occurrence  of  a
transaction,  whether in a single transaction or series of related transactions,
pursuant  to which a person or group of related  persons  (other  than  American
Industrial  Partners  Capital  Fund  III,  L.P.  or any of its  affiliates)  (A)
acquires,  whether  by merger,  stock  purchase,  recapitalization,  redemption,
issuance of capital stock or otherwise, more than fifty percent of the shares of
Common Stock  outstanding on a "fully  diluted  basis",  or (B) acquires  assets
constituting all or  substantially  all of the assets of the Corporation and its
subsidiaries.  "Fully diluted basis" means, as of any date of determination, the
number of shares of Common Stock  outstanding  plus  (without  duplication)  all
shares of Common  Stock  issuable,  whether at such time or upon the  passage of
time or the  occurrence  of future  events,  upon the  exercise,  conversion  or
exchange  of  all  then-outstanding  rights,  warrants,   options,   convertible
securities,  or  exchangeable  securities  or  indebtedness,  or  other  rights,
exercisable  for or convertible or  exchangeable  into,  directly or indirectly,
Common Stock or securities  exercisable for or convertible or exchangeable  into
Common Stock. "Conversion Stock" means shares of the Corporation's Common Stock,
par value  $.01 per  share;  provided,  that if there is a change  such that the
securities  issuable  upon  conversion of the Series A-1 are issued by an entity
other  than  the  Corporation  or  there  is a  change  in the  type or class of
securities so issuable, then the term "Conversion Stock" shall mean one share of
the security  issuable  upon  conversion  of the Series A-1 if such  security is
issuable in shares,  or shall mean the smallest  unit in which such  security is
issuable if such security is not issuable in shares.

    (b) Method of Voluntary  Conversion.  In order to voluntarily convert shares
of the Series A-1 into Conversion  Stock, the holder thereof shall surrender the
certificate or  certificates  therefor,  duly endorsed in blank at the principal
office of the Corporation or its transfer agent, if any, or at such other office
or offices, located in the United States as the Board of Directors may designate
by written  notice to all holders of Series A-1 shares,  and give written notice
to the  Corporation at said office that the holder elects to convert said shares
of Series A-1.  Shares of the Series A-1 shall be deemed to have been  converted
as of the date  (hereinafter  called  the  "Conversion  Date") of receipt by the
Corporation of the

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<PAGE>
surrender of such shares for  conversion  as provided  above,  and the person or
persons  entitled to receive the Conversion  Stock issuable upon such conversion
shall be  treated  for all  purposes  as the  record  holder or  holders of such
Conversion Stock on such date.

    (c)  Deliveries.  As soon as practicable on or after the Conversion Date but
in no event  more than five  business  days  thereafter,  the  Corporation  will
deliver by Federal Express or other  nationally  recognized  overnight  delivery
service  to the  address  of the  holders  who  submitted  the  Series  A-1  for
conversion:  (i) a certificate or certificates  for the number of full shares of
Conversion  Stock  issuable upon such  conversion in such name or names and such
denomination  or  denominations  as the converting  holder has  specified,  (ii)
payment  of  the  amount  payable  under  Section  7(e)  with  respect  to  such
conversion,  and (iii) a certificate representing any shares of Series A-1 which
were represented by the certificate or certificates delivered to the Corporation
in connection with such conversion but which were not converted.

SECTION 5. FORCED CONVERSION RIGHTS. The Corporation shall have the right in its
sole  discretion  to force  conversion of all of the shares of Series A-1 into a
number of validly  issued,  fully paid and  non-assessable  shares of Conversion
Stock of the  Corporation  computed  by  multiplying  the number of shares to be
converted by the amount of the Liquidation  Preference  thereof and dividing the
result by the Forced  Conversion  Price (as defined below) in effect at the time
of conversion at any time (a) after the Third Anniversary,  or (b) in connection
with a Change of Control, in each case so long as both on the day that notice of
forced  conversion  is given (the "Forced  Conversion  Notice  Date") and on the
Forced  Conversion  Date  (as  defined  below)  the  Conversion  Stock  has been
registered  pursuant  to the  Securities  Act of  1933,  as  amended,  and  such
registration is then currently in effect;  provided,  however, that in the event
of a forced  conversion in connection with a Change of Control,  the Corporation
shall  have  the  right  in its  sole  discretion  to  force  conversion  of the
Liquidation  Preference  of all  shares of Series A-1 into a number of shares of
Conversion Stock at a conversion price equal to the lesser of (i) the Conversion
Price then in effect, and (ii) the price per share of Conversion Stock as valued
in the Change of Control  (which value shall not be subject to reduction for any
escrow or other expenses  payable by the holders of the  Conversion  Stock under
the terms of the event  underlying  the Change of Control).  The initial  Forced
Conversion  Price is $0.66.  The  "Forced  Conversion  Price"  means the initial
Forced  Conversion  Price as  adjusted  from time to time  pursuant to Section 6
below.  The  Corporation  has  the  forced  conversion  right  after  the  Third
Anniversary  described  above in clause (a) of this Section 5 (as opposed to the
forced  conversion right in connection with a Change of Control  described above
in clause (b), in which case the  following  restrictions  do not apply) only if
the average weekly  closing bid price of the  Conversion  Stock as listed on the
OTC Bulletin Board or wherever the  Corporation's  Conversion  Stock then trades
shall be greater than or equal to the Forced Conversion Price for a period of at
least  twelve out of  thirteen  consecutive  weeks  ending no more than ten days
prior to the Forced Conversion Notice Date. Any notice of forced conversion must
be given to all holders no less than fifteen days nor more than  forty-five days
prior to the date set forth for conversion (the "Forced Conversion Date").

SECTION  6.  ANTI-DILUTION  ADJUSTMENTS.  For  purposes  of this  Section 6, the
Voluntary  Conversion  Price,  the  Forced  Conversion  Price and the  Mandatory
Conversion  Price shall be collectively  referred to as the "Conversion  Price."
The Conversion Price shall be adjusted as follows:

    (a)  Amendment  to the  Certificate  of  Incorporation.  In the  case of any
amendment to the Certificate of  Incorporation  of the Corporation to change the
designation of the Conversion Stock or the rights,  privileges,  restrictions or
conditions  in respect to the  Conversion  Stock or division  of the  Conversion
Stock,  the Series A-1 shall be adjusted so as to provide  that upon  conversion
thereof  the  holder  shall  receive,  in lieu of  shares  of  Conversion  Stock
theretofore issuable upon such conversion,  the kind and amount of shares, other
securities,  money and  property  receivable  upon such  designation,  change or
division by such holder had such holder converted such holder's shares of Series
A-1 into

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<PAGE>

Conversion  Stock  in  accordance  with  Section  4  immediately  prior  to such
designation,  change or division.  The Series A-1 shall be deemed  thereafter to
provide  for  adjustments  which  shall  be  as  nearly  equivalent  as  may  be
practicable to the adjustments provided for in this Section 6. The provisions of
this   Section   6(a)   shall   apply  in  the   same   manner   to   successive
reclassifications, changes, consolidations and mergers.

    (b) Stock Splits;  Stock  Dividends.  If the  Corporation  shall at any time
subdivide its outstanding shares of Common Stock into a greater number of shares
of Common Stock, or declare a dividend or make any other  distribution  upon the
Common Stock payable in shares of Common Stock,  the Conversion  Price in effect
immediately prior to such subdivision or dividend or other distribution shall be
proportionately  reduced,  and  conversely,  in case the  outstanding  shares of
Common Stock shall be combined into a smaller  number of shares of Common Stock,
the Conversion Price in effect  immediately  prior to such combination  shall be
proportionately increased.

    (c) Issuance of Additional  Securities.  In case the Corporation shall issue
or otherwise sell or distribute  shares of Common Stock,  or in accordance  with
Section 6(d) or 6(e) is deemed to have issued or otherwise  sold or  distributed
any shares of Common Stock, for a consideration per share in cash or property at
a price less than the then effective Conversion Price, the Conversion Price then
in effect shall  automatically  be reduced by  multiplying  the then  Conversion
Price by a  fraction,  the  numerator  of which shall be the number of shares of
Common  Stock  outstanding   immediately   prior  to  such  issuance,   sale  or
distribution  plus the  number of shares of  Common  Stock  which the  aggregate
consideration  received or to be received by the  Corporation for such issuance,
sale or distribution (such  consideration,  if other than cash, as determined by
the  Board of  Directors  including  a  majority  of the  Directors  who are not
officers or  employees  of the  Corporation  or any of its  subsidiaries,  whose
determination  shall be conclusive and described in a resolution of the Board of
Directors)  would  purchase  at the then  Conversion  Price per  share,  and the
denominator  of which shall be the number of shares of Common Stock  outstanding
immediately after giving effect to such issuance, sale or distribution.  For the
purposes of this clause (c),  the number of  outstanding  shares of Common Stock
shall be deemed to include the Common  Stock  issuable  upon  conversion  of the
Series A, the Series A-1, the Series B and any other  securities or other rights
convertible into Common Stock then outstanding.

    (d) Issuance of Options,  Warrants or Other Rights to Acquire  Common Stock.
If the Corporation in any manner grants or sells any options,  warrants or other
rights to acquire Common Stock and the price per share for which Common Stock is
issuable  upon the  exercise of such  options,  warrants or other rights or upon
conversion or exchange of any convertible  securities  issuable upon exercise of
such  options,  warrants or other  rights is less than the  Conversion  Price in
effect  immediately  prior to the time of the granting or sale of such  options,
warrants  or rights,  then the total  maximum  number of shares of Common  Stock
issuable  upon  the  exercise  of  such  options,  warrants  or  rights  or upon
conversion  or  exchange  of  the  total  maximum  amount  of  such  convertible
securities issuable upon the exercise of such options,  warrants or rights shall
be deemed to be outstanding  and to have been issued and sold by the Corporation
at the time of the granting or sale of such options, warrants or rights for such
price per share. For purposes of this clause (d), the "price per share for which
Common Stock is issuable"  shall be determined by dividing (i) the total amount,
if any,  received or  receivable by the  Corporation  as  consideration  for the
granting or sale of such options, warrants or rights, plus the minimum aggregate
amount of additional  consideration  payable to the Corporation upon exercise of
all such options, warrants or rights, plus in the case of such options, warrants
and rights which relate to convertible securities,  the minimum aggregate amount
of  additional  consideration,  if any,  payable  to the  Corporation  upon  the
issuance or sale of such  convertible  securities and the conversion or exchange
thereof,  by (ii) the total  maximum  number of shares of Common Stock  issuable
upon the exercise of such options,  warrants or rights or upon the conversion or
exchange of all such convertible  securities  issuable upon the exercise of such
options,  warrants and rights.  No further  adjustment of the  Conversion  Price
shall be made when convertible  securities are actually issued upon the exercise
of such options, warrants and rights or when

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<PAGE>
Common Stock is actually issued upon the exercise of such options,  warrants and
rights or the conversion or exchange of such convertible securities.

    (e) Issuance of Securities Convertible or Exchangeable into Common Stock. If
the Corporation in any manner issues or sells any convertible securities and the
price per share for which Common Stock is issuable  upon  conversion or exchange
thereof is less than the  Conversion  Price in effect  immediately  prior to the
time of such issue or sale,  then the maximum  number of shares of Common  Stock
issuable upon  conversion or exchange of such  convertible  securities  shall be
deemed to be outstanding  and to have been issued and sold by the Corporation at
the time of the issuance or sale of such  convertible  securities for such price
per share.  For the  purposes of this clause (e), the "price per share for which
Common Stock is issuable"  shall be  determined by dividing (i) the total amount
received or receivable by the Corporation as consideration for the issue or sale
of such Convertible Securities,  plus the minimum aggregate amount of additional
consideration,  if any,  payable  to the  Corporation  upon  the  conversion  or
exchange  thereof,  by (ii) the total  maximum  number of shares of Common Stock
issuable upon the conversion or exchange of all such convertible securities.  No
further  adjustment of the  Conversion  Price shall be made when Common Stock is
actually issued upon the conversion or exchange of such convertible  securities,
and if any  such  issue  or sale of such  convertible  securities  is made  upon
exercise  of any  options,  warrants  and  rights for which  adjustments  of the
Conversion Price had been or are to be made pursuant to other provisions of this
Section 6, no further adjustment of the Conversion Price shall be made by reason
of such issue or sale.

    (f) Change in Option Price or Conversion Rate;  Expiration.  If the purchase
price  provided for in any options,  warrants or rights to acquire Common Stock,
the additional consideration, if any, payable upon the conversion or exchange of
any convertible  securities or the rate at which any convertible  securities are
convertible  into or  exchangeable  for Common  Stock  changes at any time,  the
Conversion  Price in  effect  at the time of such  change  shall be  immediately
adjusted  to the  Conversion  Price which would have been in effect at such time
had such  options,  warrants,  rights to  acquire  Common  Stock or  convertible
securities  still   outstanding   provided  for  such  changed  purchase  price,
additional  consideration  or  conversion  rate, as the case may be, at the time
initially granted, issued or sold. Upon the expiration of any options,  warrants
or rights to acquire  Common  Stock for which an  adjustment  to the  Conversion
Price  had  been  made,  the  Conversion  Price  in  effect  at the time of such
expiration  shall be immediately  adjusted to the  Conversion  Price which would
have been in effect at such time had such options, warrants or rights to acquire
Common  Stock been  exercisable  only for the  number of shares of Common  Stock
actually issued upon the exercise of such options, warrants or rights to acquire
Common Stock. Notwithstanding the foregoing, no adjustment under this clause (f)
shall at any time cause the  Conversion  Price  hereunder  to be increased to an
amount which exceeds the Conversion  Price in effect on the applicable  original
adjustment date.

    (g) Treasury Shares. The number of shares of Common Stock outstanding at any
given time shall not include  shares  owned or held by or for the account of the
Corporation  or any  subsidiary  thereof,  and the  disposition of any shares so
owned or held shall be considered an issue or sale of Common Stock.

    (h) Certain  Events.  If any event  occurs of the type  contemplated  by the
provisions of this Section 6 but not expressly  provided for by such provisions,
then the Corporation's  Board of Directors shall make an appropriate  adjustment
in the  Conversion  Price so as to protect  the rights of the  holders of Series
A-1;  provided that no such  adjustment  shall increase the Conversion  Price as
otherwise determined pursuant to this Section 6 or decrease the number of shares
of Conversion Stock issuable upon conversion of each share of Series A-1.

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<PAGE>

    (i)  Exception.   Notwithstanding   anything  herein  to  the  contrary,  no
adjustment shall be made to the Conversion Price pursuant to this Section 6 upon
the exercise of any options,  warrants or other rights to purchase  Common Stock
outstanding  as of the Funding  Date,  upon the issuance of shares of the Series
A-1,  upon the issuance of any  dividends on  securities  outstanding  as of the
Funding  Date or on the  Series  A-1,  or upon  conversion  of the Series A, the
Series A-1,  the Series B or any  securities  or other rights  convertible  into
Common  Stock,  which  options,  warrants,   securities  or  other  rights  were
outstanding  as of the  Funding  Date.  Notwithstanding  anything  herein to the
contrary,  no adjustment  shall be made to the Conversion Price pursuant to this
Section 6 for (i) any options, warrants or other rights to purchase Common Stock
granted  to  officers,  directors  or  employees  of,  or  consultants  to,  the
Corporation  pursuant  to a warrant,  stock  grant,  option  agreement  or plan,
purchase plan or other employee stock incentive program or agreement approved by
the  Board of  Directors,  or (ii)  securities  issued  in  connection  with the
acquisition by the Corporation of another business entity or majority  ownership
thereof approved by the Board of Directors.

SECTION 7. ADDITIONAL CONVERSION MATTERS.

    (a)  Recapitalization,   Reorganization,  Reclassification,   Consolidation,
Merger  or  Sale.  Any   recapitalization,   reorganization,   reclassification,
consolidation,  merger,  sale of all or substantially  all of the  Corporation's
assets or other  transaction,  in each case which is  effected  in such a manner
that the holders of Conversion Stock are entitled to receive (either directly or
upon  subsequent  liquidation)  with  respect to or in exchange  for  Conversion
Stock,  shares of the Corporation's stock or other securities (other than shares
of  Conversion  Stock and other  than  securities  for  which an  adjustment  is
otherwise  provided in Section 6), stock or other  securities of other  persons,
assets  (excluding  cash  dividends) or options,  warrants or rights  (excluding
options and warrants to purchase and rights to subscribe for Conversion Stock or
other  securities  of the  Corporation  convertible  into  or  exchangeable  for
Conversion  Stock), is referred to herein as an "Organic Change".  Unless shares
of Series A-1 are converted to Conversion Stock prior to an Organic Change, then
prior to the consummation of any such Organic Change, the Corporation shall make
appropriate  provisions (in form and substance  reasonably  satisfactory  to the
holders of a majority of the Series A-1 then outstanding) to ensure that each of
the  holders  of Series  A-1 shall  thereafter  have the  right to  acquire  and
receive,  in lieu  of or in  addition  to (as the  case  may be) the  shares  of
Conversion  Stock  immediately  theretofore  acquirable and receivable  upon the
conversion  of such  holder's  Series A-1,  such shares of stock,  securities or
assets as such holder would have received in connection with such Organic Change
if such holder had  converted its Series A-1  immediately  prior to such Organic
Change.  In  each  such  case,  the  Corporation  shall  also  make  appropriate
provisions (in form and substance  reasonably  satisfactory  to the holders of a
majority  of the Series  A-1  Preferred  then  outstanding)  to insure  that the
provisions of this Certificate of Designation  shall thereafter be applicable to
the Series A-1 (including, in the case of any such consolidation, merger or sale
in  which  the  successor  entity  or  purchasing   entity  is  other  than  the
Corporation,  an immediate  adjustment of the Conversion  Price to the value for
the Conversion  Stock  reflected by the terms of such  consolidation,  merger or
sale,  and a  corresponding  immediate  adjustment  in the  number  of shares of
Conversion Stock acquirable and receivable upon conversion of Series A-1, if the
value so reflected is less than the Conversion Price in effect immediately prior
to such  consolidation,  merger or sale).  The Corporation  shall not effect any
such  consolidation,  merger or sale, unless prior to the consummation  thereof,
the  successor   entity  (if  other  than  the   Corporation)   resulting   from
consolidation or merger or the entity  purchasing such assets assumes by written
instrument (in form and substance  reasonably  satisfactory  to the holders of a
majority of the Series A-1 then outstanding),  the obligation to deliver to each
such holder such shares of stock,  securities or assets as, in  accordance  with
the  foregoing  provisions,   such  holder  may  be  entitled  to  acquire.  For
clarification  purposes only,  nothing in this Section 7(a) shall  terminate the
right of a holder of Series A-1 to convert  such  holder's  shares  pursuant  to
Section 4.

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<PAGE>

    (b) Record of Conversion Price. Whenever the shares of Common Stock or other
types of securities or assets receivable upon conversion of the Series A-1 shall
be adjusted as provided in Section 6, the Corporation shall forthwith obtain and
file  with  its  corporate  records  a  certificate  or  letter  from a firm  of
independent  public  accountants  of  recognized  standing  (which  may  be  the
Corporation's then independent  certified public accountants)  setting forth the
computation  and the  adjusted  number  of  shares  of  Common  Stock  or  other
securities  or  assets  resulting  from  such  adjustments,  and a copy  of such
certificate  or  letter  shall  be  mailed  to  the  holders  hereof.  Any  such
certificate or letter shall be conclusive  evidence as to the correctness of the
adjustment  or  adjustments  referred  to  therein  and shall be  available  for
inspection  by any holders of the Series A-1 on any day during  normal  business
hours.

    (c) Notice:

         (i)  Immediately  upon any  adjustment  of the  Conversion  Price,  the
         Corporation  shall give written notice thereof to all holders of Series
         A-1, setting forth in reasonable  detail and certifying the calculation
         of such adjustment.

         (ii) The Corporation shall give written notice to all holders of Series
         A-1 at least 20 days prior to the date on which the Corporation  closes
         its  books or  takes a  record  (A) with  respect  to any  dividend  or
         distribution  upon  Common  Stock,  (B)  with  respect  to any pro rata
         subscription  offer to holders of Common  Stock or (C) for  determining
         rights to vote with  respect  to any  Organic  Change,  dissolution  or
         liquidation..

         (iii) The Corporation  shall also give written notice to the holders of
         Series  A-1 at least 20 days  prior  to the date on which  any  Organic
         Change shall take place.

    (d) Reservation of Shares.  The  Corporation  shall at all times reserve and
keep available out of its authorized but unissued Common Stock,  for the purpose
of effecting the  conversion of the shares of the Series A-1, the full number of
shares of Common Stock then deliverable upon the conversion of all shares of the
Series A-1 then outstanding.

    (e) Fractional Shares. No fractional shares of Common Stock are to be issued
upon conversion.  The Corporation  shall pay a cash adjustment out of surplus in
respect to any  fraction of a share which would  otherwise  be  issuable,  in an
amount  equal to the fair  market  value of the Common  Stock which shall be the
same  fraction of the last price per share at which the Common Stock was sold on
any principal  stock  exchange on which such stock is then listed or admitted to
trading,  prior to the opening of business on the conversion date, or if no sale
of such  stock  takes  place on such day on such  exchange,  the  average of the
closing bid and asked prices on such day as officially  quoted on such exchange,
or if such stock  shall not at the time be listed or  admitted to trading on any
stock  exchange,  the average of the last bid and asked prices for such stock on
such day in the OTC  Bulletin  Board  prior to the  opening of  business  on the
conversion  date,  or,  if the  Common  Stock  is not then  included  in the OTC
Bulletin Board, as furnished by the National  Quotation Bureau,  Inc. or if such
firm is not at the time  engaged in the business of  reporting  such prices,  as
furnished  by any firm then  engaged  in such  business  or by any member of the
National  Association of Securities Dealers,  Inc., selected by the Corporation.
If the Common  Stock is not then  publicly  traded,  fair market  value shall be
determined in good faith by the Corporation's Board of Directors.

    (f) Transfer Taxes. The Corporation will pay any and all transfer taxes that
may be payable in respect of the issue or delivery of shares of Common  Stock on
conversion of shares of the Series A-1 pursuant hereto.

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<PAGE>

    (g)  Status  of Common  Stock.  All  Common  Stock  that may be issued  upon
conversion of the Series A-1 will, upon issuance,  be validly issued, fully paid
and  non-assessable  and free from all taxes,  liens and charges with respect to
the issuance thereof.

    (h) Close of Books.  The  Corporation  shall not close its books against the
transfer of Series A-1 or of Conversion Stock issued or issuable upon conversion
of Series A-1 in any manner  which  interferes  with the  timely  conversion  of
Series A-1. The Corporation shall assist and cooperate with any holder of Shares
required to make any governmental  filings or obtain any  governmental  approval
prior to or in connection  with any conversion of Shares  hereunder  (including,
without limitation, making any filings required to be made by the Corporation).

SECTION 8. VOTING.

    (a) Election of Directors.  In the election of directors of the Corporation,
the holders of the Series A-1,  voting  together  with the holders of the Common
Stock and the  holders  of the  Series A as a single  class,  with each share of
Common Stock  entitled to one vote,  each share of Series A entitled to one vote
for each share of Common Stock issuable upon conversion pursuant to Section 4 of
that certain  Certificate to Provide for the Designation,  Preferences,  Rights,
Qualifications,  Limitations or Restrictions  Thereof, of the Series A Preferred
Stock, 71/2% Redeemable Convertible Series and each share of Series A-1 entitled
to one vote for each share of Common Stock issuable upon conversion  pursuant to
Section 4  hereof,  in all  cases as of the  record  date of such vote or, if no
record  date is  specified,  as of the date of such vote,  shall be  entitled to
elect one less than a majority of the  directors (or two less than a majority if
there are an even number of  directors) to serve on the  Corporation's  Board of
Directors,  until such director's  successors are duly elected by the holders of
the Common Stock,  the Series A and the Series A-1 or are removed from office by
the holders of the Common Stock, the Series A and the Series A-1.

    (b) Voting as a Separate  Class.  The  Corporation  shall not,  without  the
consent of the  holders  of at least a majority  of the shares of the Series A-1
then  outstanding,  voting as a  separate  class to the  exclusion  of all other
classes,  amend, alter, change, or repeal any of the express terms of the Series
A-1.

    (c) Other Voting Rights.  The holders of the Series A-1 shall be entitled to
vote on all matters,  other than those  described  above in clause (a) or (b) of
this  Section  8, in which  holders of Common  Stock,  Series A and Series B are
entitled to vote, voting together with holders of the Common Stock, the Series A
and the Series B as a single class with (i) each share of Common Stock  entitled
to one vote,  (ii) each share of Series A-1  entitled to one vote for each share
of Common Stock  issuable upon  conversion  pursuant to Section 4 hereof,  (iii)
each  share of Series A  entitled  to one vote for each  share of  Common  Stock
issuable upon  conversion  pursuant to Section 4 of that certain  Certificate to
Provide for the Designation, Preferences, Rights, Qualifications, Limitations or
Restrictions  Thereof,  of the Series A Preferred  Stock,  71/2%  Non-Redeemable
Convertible  Series,  and (iv) each share of Series B  entitled  to one vote for
each share of Common Stock  issuable  upon  conversion  pursuant to Section 4 of
that certain  Certificate to Provide for the Designation,  Preferences,  Rights,
Qualifications,  Limitations or Restrictions  Thereof, of the Series B Preferred
Stock, 15% Redeemable  Convertible Series, in all cases as of the record date of
such vote or, if no record date is specified,  as of the date of such vote.  The
holders of the Series A-1 shall be entitled to receive all  communications  sent
by the Corporation to the holders of Common Stock.

    (d) Except as provided in Section 8(b) or by Delaware law, holders of shares
of the Series A-1 shall not be entitled to vote as a separate class.

SECTION 9. LIQUIDATION.

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<PAGE>

    (a)  Liquidation  Preference.  In the event of any voluntary or  involuntary
liquidation,   dissolution  or  winding  up  of  the  Corporation   (hereinafter
collectively  called  "liquidation"),  before any amount shall be paid to or set
aside for, or any assets shall be  distributed  among,  the holders of shares of
Series A, Common  Stock,  or of any other  equity  security  of the  Corporation
subordinate to the Series A-1 as provided in Section 3 hereof,  each holder of a
share of the Series A-1 shall be  entitled  to receive  out of the assets of the
Corporation or the proceeds thereof, the higher of (i) a preferential payment in
an amount equal to the Liquidation Preference thereof, and (ii) the value of the
Common  Stock  issuable  upon  conversion  of  the  Series  A-1  had  all of the
outstanding Series A-1 been converted immediately prior to liquidation.

    (b) Proportional  Rights. In the event the amount available for distribution
as  liquidation  preference  payments to holders of the Series A-1 and any other
stock ranking on a parity  therewith is  insufficient  to pay the full amount of
their  respective  preferences,  such amount shall be divided  among and paid to
such holders  ratably in  proportion  to the  respective  amounts which would be
payable to such holders if their respective  liquidation  preferences were to be
paid in full.

    (c) Insufficient  Funds. In the event any liquidation  preference payment to
be made on the shares of the Series A-1 shall  amount in the  aggregate  to less
than the Liquidation  Preference thereof,  the Corporation in its discretion may
require the surrender of  certificates  for shares of the Series A-1 and issue a
replacement  certificate  or  certificates,  or it may require the  certificates
evidencing  the shares in respect  of which such  payments  are to be made to be
presented to the Corporation,  or its agent, for notation thereon of the amounts
of the liquidation  preference  payments made in respect of such shares.  In the
event a certificate for shares of the Series A-1 on which payment of one or more
partial  liquidation  preferences  has been made is  presented  for  exchange or
transfer  shall  bear an  appropriate  notation  as to the  aggregate  amount of
liquidation preference payments theretofore made in respect thereof.

    (d) Merger or Sale.  Neither the  consolidation or merger of the Corporation
into or with any other entity or entities (whether or not the Corporation is the
surviving  entity),  nor the sale or transfer by the  Corporation  of all or any
part of its assets,  nor the reduction of the capital  stock of the  Corporation
nor  any  other  form  of  recapitalization  or  reorganization   affecting  the
Corporation  shall be deemed to be a  liquidation,  dissolution or winding up of
the Corporation for the purposes of this Section 9.

SECTION 10. REPLACEMENT CERTIFICATES.

    (a) Mutilated  Certificate.  If any mutilated  certificate  of Series A-1 is
surrendered to the  Corporation,  the  Corporation  shall execute and deliver in
exchange  therefor a new  certificate for Series A-1 of like tenor and principal
amount, bearing a number not contemporaneously outstanding.

    (b)  Destroyed,  Lost or Stolen  Certificate.  If there is  delivered to the
Corporation (i) evidence to its reasonable satisfaction of the destruction, loss
or theft of any certificate of Series A-1 and (ii) such  reasonable  security or
indemnity as may be required by it to save it harmless,  then, in the absence of
notice to the Corporation  that such certificate of Series A-1 has been acquired
by a bona fide purchaser,  the Corporation  shall execute and deliver in lieu of
any such destroyed,  lost or stolen certificate of Series A-1, a new certificate
of Series  A-1 of like  tenor and  principal  amount  and  bearing a number  not
contemporaneously outstanding.

    (c) Status of New  Certificate.  Upon the issuance of any new certificate of
Series A-1 under this Section 11, the  Corporation  may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in  relation  thereto  and any other  expenses  connected  therewith.  Every new
certificate  of Series A-1  issued  pursuant  to this  Section 11 in lieu of any
destroyed,  lost or  stolen  certificate  of Series  A-1,  shall  constitute  an
original additional contractual obligation of the

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<PAGE>
Corporation,  whether or not the destroyed, lost or stolen certificate of Series
A-1 shall be at any time  enforceable by anyone.  Any new certificate for Series
A-1  delivered  pursuant to this  Section 11 shall be so dated that neither gain
nor loss in interest  shall result from such  exchange.  The  provisions of this
Section 11 are  exclusive  and shall  preclude (to the extent  lawful) all other
rights and remedies  with respect to the  replacement  or payment of  mutilated,
destroyed, lost or stolen certificate of Series A-1.

SECTION 11. AMENDMENT AND WAIVER. No amendment,  modification or waiver shall be
binding or effective  with  respect to any  provision of Sections 1 to 12 hereof
without the prior written  consent of the holders of a majority of the shares of
Series A-1 outstanding at the time such action is taken.

SECTION 12.  NOTICES.  Except as otherwise  expressly  provided  hereunder,  all
notices  referred  to  herein  shall be in  writing  and shall be  delivered  by
registered or certified mail, return receipt  requested and postage prepaid,  or
by reputable overnight courier service,  charges prepaid, and shall be deemed to
have been given when so mailed or sent (i) to the Corporation,  at its principal
executive  offices and (ii) to any  stockholder,  at such holder's address as it
appears in the stock records of the Corporation  (unless otherwise  indicated by
any such holder).











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