4/28/03
                           CERTIFICATE OF DESIGNATIONS
                                       OF
                                 CNE GROUP, INC.
                       ADOPTED PURSUANT TO SECTION 151(g)
                                     OF THE
                        DELAWARE GENERAL CORPORATION LAW


     RESOLVED,  that pursuant to the authority expressly granted to the Board of
Directors (the "Board of Directors") of CNE Group, Inc., a Delaware  Corporation
(the  "Company"),  by the provisions of the Amended and Restated  Certificate of
Incorporation  of the  Company  and the  provisions  of  Section  151(g)  of the
Delaware General Corporation Law, the Board of Directors hereby creates a series
of preferred stock, par value $0.00001 per share, and determines the designation
and number of shares of Series C Preferred  Stock which  constitute  such series
and the relative rights, preferences and limitations of such series as follows:

     1.  Designation  and  Number of Series C  Preferred  Stock.  The  series of
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Preferred Stock shall be designated as "Series C Preferred  Stock"  (hereinafter
called the "Series C Preferred Stock") and shall consist of a total of 9,735,875
shares of Series C Preferred  Stock,  with a par value  $0.00001 per share and a
stated value (the "Stated Value") of $1.00 per share.

     2. Dividends. The holders of Series C Preferred Stock shall not be entitled
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to receive any dividends except as provided in Section 4, below.

     3. Liquidation Preference.
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        (a) In the event of any  liquidation,  dissolution  or winding up of the
Company, either voluntary or involuntary,  the holders of the Series C Preferred
Stock will share in any assets  remaining  after  payment to the  holders of any
other then outstanding preferred stock on a pari passu basis with the holders of
the  Company's  Common Stock as if the C Preferred  Stock had been  redeemed for
Common Stock as provided in Section 4, below.

        (b) In the event of a  liquidation  as  described  above,  all  non-cash
assets of the Company shall be valued as follows:

            (i)  Securities  not subject to legend,  investment  letter or other
similar restrictions on free marketability:

            (A) If traded on a recognized  securities  exchange,  the value
shall be deemed to be the average of the  closing  prices of the  securities  on
such exchange over the thirty day period ending three days prior to the closing;



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            (B) If actively traded  over-the-counter,  the value shall be deemed
to be the average of the closing bid or sale prices  (whichever  is  applicable)
over the thirty day period ending three days prior to the closing; and

            (C) If there is no active public market, the value shall be the fair
market value thereof,  as determined by the Company's Board of Directors,  which
determination shall be final absent fraud or manifest error.

                 (ii) Securities  subject to legend,  investment letter or other
similar  restrictions shall be valued by an appropriate discount from the market
value as determined in accordance with subsection (i) (C) above.

     4.  Redemption.  The holders of the Series C Preferred  Stock shall have no
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right of redemption.  The Company shall have the right,  but not the obligation,
to redeem all or any  portion  of the Series C  Preferred  Stock  commencing  60
months after the  issuance  thereof for a period of six months  thereafter  (the
"Redemption Period").  The date on which the redemption may be effected shall be
30 days after the Company  shall give notice of such  redemption  to the holders
who shares are to be redeemed (the  "Redemption  Date").  Each share of Series C
Preferred Stock shall be redeemed,  at the Company's option, for (i) cash, in an
amount  equal to the Stated  Value plus a 17.5%  compounded  annual  return (the
"Rate of Return")  from the date of issuance such share to the  Redemption  Date
reduced by any  dividend  paid plus the Rate of Return on such  payment from the
date of such payment to the  Redemption  Date;  (ii) one share of the  Company's
Common  Stock  (which,  together  with  the  Company's  Series  E 8%  Cumulative
Preferred Stock,  hereinafter  referred to as the "Redeeming  Stock");  or (iii)
1.469328 shares of the Company's Series E 8% Cumulative  Preferred Stock (the "E
Preferred  Stock")  having a par value of $0.00001 per share and stated value of
$1.00 per share.  To the extent that the Company  shall  determine not to redeem
shares of Series C Preferred Stock during the C Redemption  Period, the Series C
Preferred  Stock  then  remaining   outstanding  shall  thereafter  bear  a  12%
cumulative  dividend,  payable  quarterly in cash. In the event that the Company
shall fail to pay two  consecutive  quarterly  dividends  (a  "Dividend  Payment
Failure"),  the holders of a majority of the then outstanding shares of Series C
Preferred  Stock  shall have the right to elect the  majority  of the  Company's
directors until the Dividend  Payment Failure shall have been cured.  If, during
the period prior to the Company curing a Dividend Payment  Failure,  the holders
of the Company's Series A Preferred Stock (the "A Preferred Stock") and/or the E
Preferred  Stock shall obtain the right to elect the  majority of the  Company's
directors  as the  result  of a  Dividend  Payment  Failure  as  defined  in the
Certificates of Designations for the A and/or E Preferred Stock, as the case may
be, then the holders of a majority of the shares of the Series C Preferred Stock
and the A and/or E Preferred  Stock,  as the case may be,  shall have the right,
voting as a single class, to elect the majority of the Company's directors until
the Dividend  Payment Failure of the applicable  Series of Preferred Stock shall
have been  paid.  By way of  example,  if the  holders  of the Series C, A and E
Preferred  Stock  shall  have  obtained  the  right to vote as  provided  herein
pursuant to a Dividend  Payment Failure and the Dividend  Payment Failure of one
Series is  subsequently  cured but the  Dividend  Payment  Failure  of


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the other  Series  shall not have been cured,  only the Classes  whose  Dividend
Payment Failure have not been cured shall retain the right to elect the majority
of the  Company's  directors.  If  the  Company  redeems  less  than  all of the
outstanding  shares of Series C Preferred  Stock as provided in this  Section 4,
then such redemption  shall be made on a pro rata basis. The Company shall remit
the appropriate  amount of cash or issue the appropriate number of shares of the
Redeeming  Stock,  as the case may be, to each  holder of the Series C Preferred
Stock upon receipt of such holder's  certificate  representing the shares of the
Series C Preferred Stock to be redeemed.  After the Redemption  Date, all shares
of Series C Preferred Stock redeemed as provided herein shall cease to exist and
the holders  thereof shall have only the right to receive the cash or the shares
of  Redeeming  Stock  payable or issuable  to them,  as the case may be, for the
redemption of their Series C Preferred Stock.

     5. Voting Rights.  The holders of outstanding  shares of Series C Preferred
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Stock  shall have no voting  rights  except as provided in Section 4 above or as
may be required by Delaware law.

     6. Protective Provisions. So long as any shares of Series C Preferred Stock
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are outstanding, the Company shall not, without first obtaining the approval (by
vote or by written  consent,  as  provided  by law) of the holders of at least a
majority of the then outstanding shares of Series C Preferred Stock:

            (a) alter or change the rights,  preferences  of  privileges  of the
Series C  Preferred  Stock so as to affect  adversely  such  Series C  Preferred
Stock;

            (b) increase or decrease (other than by redemption) the total number
of authorized shares of Series C Preferred Stock; or

            (c)  authorize  or issue,  or  obligate  itself to issue,  any other
equity  security,  including any other security  convertible into or exercisable
for any equity security (i) having a preference over, or being on a parity with,
the Series C Preferred Stock upon liquidation,  or (ii) having rights similar to
any of the rights of the Series C Preferred Stock under this Section 7.


     7.  Issuance  with  Warrants;  Detachability  of  Warrants.  The  Series  C
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Preferred  Stock shall be issued  together with the Company's  Class C Warrants,
each  Warrant to purchase  one share of Common  Stock,  initially,  at $1.00 per
share,  at the rate of one Warrant  for each share of Series C Preferred  Stock.
The Series C Preferred Stock and the Class C Warrants attached thereto shall not
detachable  from each other or separately  transferable  for 66 months after the
issuance thereof (the "Non-detachable Period") and the certificates representing
the shares of Series C Preferred  Stock issued to the holder  thereof shall bear
an appropriate legend reflecting this restriction.  In the event that any shares
of Series C  Preferred  Stock  shall be  redeemed  by the  Company  prior to the
expiration of the


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<PAGE>

Non-detachable Period, the Class C Warrants attached thereto shall expire on the
redemption date.


     8. Notices. Any notice required by the provisions hereof to be given to the
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holders of the Series C Preferred  Stock shall be deemed  given if  deposited by
mail,  postage  prepaid,  and  addressed  to each holder of record at his or her
address appearing on the books of the Company.

IN WITNESS WHEREOF, the Company has caused this Certificate of Designations to
be signed by Anthony S. Conigliaro, its Secretary, as of the 28th day of April
2003.

                                             /S/ANTHONY S. CONIGLIARO
                                             ------------------------
                                             Anthony S. Conigliaro



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