<PAGE>




     Designation of Powers, Preferences and Relative Participating, Optional,
     Conversion or Other Rights and Qualifications, Limitations and
     Restrictions of Series A Cumulative Convertible Redeemable Preferred
     Stock:

          NOW THEREFORE BE IT RESOLVED, that pursuant to the authority vested
     in the Board of Directors of the Corporation by the provisions of Article
     FOURTH of the Certificate of Incorporation to authorize the issuance of
     one or more series of preferred stock and to fix and determine with
     respect to each series the designation, powers, preferences and relative
     participating, optional, conversion or other rights and qualifications,
     limitations and restrictions thereof, the Corporation shall, and hereby
     does authorize issuance of a series of thirty (30) shares of Series A
     cumulative convertible redeemable preferred stock, having the following
     designation, powers, preferences and relative participating, optional,
     conversion or other rights and qualifications, limitations and
     restrictions:

          1.  Designation.  Such series of cumulative convertible redeemable
     preferred stock shall be designated and known as: "Series A 12% Cumulative
     Convertible Redeemable Preferred Stock" ("Preferred Stock").  The stated
     value of each share of Preferred Stock shall be $50,000 ("Stated Value").

          2.  Dividends.  The holders of shares of Preferred Stock shall be
     entitled to receive, but only when and as declared by the Board of
     Directors, cash dividends in an amount equal to twelve percent (12%) of
     the Stated Value per share per annum, payable quarterly on such dates in
     each year as shall be fixed by the Board of Directors.

          Such dividends on the Preferred Stock shall be cumulative from and
     after such date or dates as shall be fixed by the Board of Directors for
     such Series.  No dividends shall be paid or set apart for payment on the
     Corporation's Common Stock, nor shall any distribution be made on the
     Common Stock, other than a dividend payable in Common Stock or in stock
     ranking junior to the Preferred Stock ("Junior Stock"), nor shall any
     shares of Common Stock or Junior Stock be redeemed, retired or otherwise
     acquired for a valuable consideration  (except  upon the conversion 
     thereof) unless full cumulative dividends on all Preferred Stock for all
     dividend periods shall have been declared and the Corporation shall have
     paid such dividends or shall have set aside a sum sufficient for the
     payment thereof.

          Any accumulation of dividends on the Preferred stock shall not bear
     interest.  The holders of Preferred Stock shall not be entitled to receive
     any dividends thereon other than the dividends provided for herein.

          Dividends on Preferred Stock shall be declared if, when and as the
     Board of Directors shall in its sole discretion deem advisable, and only
     from the net profits or surplus of the Corporation as such shall be fixed
     and determined by the said Board of Directors.  The determination of the
     Board of Directors at any time of the amount of net profits or surplus


                                        - 1 -
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     available for dividend shall be binding and conclusive on the holders of
     all the stock of the Corporation at the time outstanding.

          3.  No preemptive rights.  No holder of the Preferred Stock shall be
     entitled, as of right, to purchase or subscribe for any part of the
     unissued stock of the Corporation or of any stock of the Corporation to be
     issued by reason of any increase of the authorized capital stock of the
     Corporation, or to purchase or subscribe for any bonds, certificates of
     indebtedness, debentures or other securities convertible into or carrying
     options or warrants to purchase stock or other securities of the
     Corporation or to purchase or subscribe for any stock of the Corporation
     purchased by the Corporation or by its nominee or nominees, or to have any
     other preemptive rights now or hereafter defined by the laws of the State
     of Delaware.

          4.  Preference on liquidation, etc.  In the event of any voluntary or
     involuntary liquidation, dissolution or winding up of the Corporation, or
     any reduction in its capital resulting in any distribution of assets to
     its stockholders, holders of Preferred Stock shall be entitled to receive
     in cash out of the assets of the Corporation, whether from capital or from
     earnings, available for distribution to its stockholders, before any
     amount shall be paid to the holders of Common Stock, a sum equal to Stated
     Value, plus an amount equal to all accumulated and unpaid dividends
     thereon to the date fixed for payment of such distributive amount. The
     purchase or redemption by the Corporation of stock of any class, in any
     manner permitted by law, shall not for the purpose of this paragraph be
     regarded as a liquidation, dissolution or winding up of the Corporation or
     as a reduction of its capital.   Neither the consolidation nor merger of
     the Corporation with or into any other corporation or corporations, nor
     the sale or transfer by the Corporation of all or any part of its assets,
     shall be deemed to be a liquidation, dissolution or winding up of the
     Corporation for the purposes of this paragraph.   A dividend or
     distribution to stockholders from net profits or surplus earned after the
     date of any reduction of capital shall not be deemed to be a distribution
     resulting from such reduction in capital.  No holder of Preferred Stock
     shall be entitled to receive any amounts with respect thereto upon any
     liquidation, dissolution or winding up of the Corporation other than the
     amounts provided for in this paragraph.

           5.  Redemption.  The Corporation, by action of its Board of
     Directors, may redeem all (but not less than all) the Preferred Stock at
     any time after six (6) months from the date of issuance of the Preferred
     Stock at a price equal to the Stated Value of each share redeemed , plus a
     sum equal to all accumulated and unpaid dividends thereon to the date
     fixed for redemption, but only if the average closing price of the
     Corporation's Common Stock on the dates during the 120-day period
     immediately prior to the date notice of redemption is given (as provided
     herein below) such Common Stock was traded  shall have been not less than
     $5.00 per share, and the closing price of the Corporation's Common Stock
     for each of the thirty (30) trading days immediately preceding the date of
     such notice shall have been not less than $5.00 per share, adjusted in


                                        - 2 -
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     each case for stock splits, stock dividends or other similar transactions
     effecting the price of the Common Stock.

          Notice of the election of the Corporation to redeem any Preferred
     Stock shall be given by the Corporation by mailing a copy of such notice
     in person or by registered or certified mail, return receipt requested not
     less than thirty (30) business days prior to the date designated therein
     as the date for such redemption, to the holders of record of the Preferred
     Stock to be redeemed, addressed to them at their respective address
     appearing on the books of the Corporation.

          The Board of Directors shall have full power and authority, subject
     to the limitations and provisions herein contained, to prescribe the
     manner in which and the terms and conditions upon which the Preferred
     Stock shall from time to time be redeemable.  On and after the date
     specified in such notice, each holder of the Preferred Stock called for
     redemption as aforesaid, upon presentation and surrender at the place
     designated in such notice of the certificate or certificates for such
     Preferred Stock held by him, properly endorsed in blank for transfer or
     accompanied by proper instruments of assignment in blank (if required by
     the Corporation) and bearing all necessary stock transfer tax stamps
     thereto affixed and cancelled, shall be entitled to receive therefor the
     redemption price thereof.

          From and after the date of redemption specified in such notice
     (unless default shall be made by the Corporation in providing moneys for
     the payment of the redemption price) all dividends upon the Preferred
     Stock so called for redemption shall cease to accrue and, from and after
     said date (unless default shall be made by the Corporation as aforesaid)
     or, if the Corporation shall so elect, from and after the date specified
     therefor in the notice of redemption (prior to the date of redemption so
     specified) on which the Corporation shall provide the moneys for the 
     payment of the redemption price by depositing the amount thereof in trust
     for such purpose with a bank or trust company doing business in the City,
     County and State of New York, and having a capital and surplus of at least
     $500,000,000, all rights of the holders of the Preferred Stock so called
     for redemption as stockholders of the Corporation, excepting only the
     right to receive the redemption price of such shares on and after the
     redemption date without interest thereon, shall cease and determine.

          In the event the rights of the holders of the Preferred Stock as
     stockholders of the Corporation shall cease prior to the date of
     redemption as aforesaid, the amount of dividends which would otherwise
     have accrued (if such rights had not ceased) on such Preferred Stock from
     the time such rights cease to the date of redemption, shall be deemed an
     additional premium.  Any interest accrued on funds so deposited shall be
     paid to the Corporation from time to time.   In case any holders of
     Preferred Stock so called for redemption shall not, within six years after
     such deposit, claim the amounts deposited with respect to the redemption
     thereof, any such bank or trust company shall, upon demand, pay over to
     the Corporation such unclaimed amounts and thereupon such bank or trust


                                        - 3 -
<PAGE>







     company shall be relieved of all responsibility in respect thereof to such
     holders.

          All Preferred Stock at any time redeemed shall be cancelled and shall
     not be reissued.

          The Corporation may also from time to time, to the extent now or
     hereafter permitted by law, purchase Preferred Stock at a purchase price
     not exceeding the redemption price thereof.  Except in accordance with an
     offer made to all holders of Preferred Stock, the Corporation shall not at
     any time purchase less than the whole amount of its then outstanding
     Preferred Stock unless full cumulative dividends to such date of purchase
     (if the same be a dividend payment date, or to the next preceding dividend
     payment date if such date of purchase is not a dividend payment date) upon
     all Preferred Stock outstanding, and not then to be purchased, shall have
     been paid or declared and set apart for payment.

          6.  Conversion.  The holders of shares of Preferred Stock shall have
     the right, at their option, to convert such shares into shares of  Common
     Stock of the Corporation ("Conversion Right") on the following terms and
     conditions:

          (a)  Each share of Preferred Stock shall be convertible, but only in
     whole, at any time commencing ninety (90) days after its issuance (or, if
     such share is called for redemption, at any time up to and including, but
     not after, the close of business on the fifth full business day prior to
     the date fixed for such redemption, unless default shall be made by the
     Corporation in providing moneys for the payment of the redemption price),
     into ninety-four thousand, three hundred forty (94,340) fully paid and
     non-assessable shares of  Common Stock of the Corporation as constituted
     at the time of such conversion.  Every reference herein to the  Common
     Stock of the Corporation (unless a different intention is expressed) shall
     be to the shares of the  Common Stock of the Corporation, par value $.01
     per share, as such stock exists immediately after the issuance of shares
     of Preferred Stock provided for hereunder, or to stock into which said 
     Common Stock may be changed from time to time thereafter.

          (b)  The Conversion Right is exercisable upon presentation and
     surrender of the certificate of Preferred Stock, duly endorsed for
     transfer, at the principal office to the Corporation or at any other
     office or agency maintained by the Corporation for the transfer of the
     Preferred Stock, whereupon the holder of such Preferred Stock, shall be
     entitled, subject to the limitations herein contained, to receive in
     exchange therefor a certificate or certificates for fully paid and
     nonassessable shares of  Common Stock, as provided above.  The Preferred
     Stock shall be deemed to have been converted and the person converting the
     same to have become the holder of record of  Common Stock, for the purpose
     of receiving dividends and for all other purposes whatever, as of the date
     when the certificate or certificates for such Preferred Stock are
     surrendered to the Corporation as aforesaid.  The Corporation shall not be
     required to make any such conversion, and no surrender of the Preferred
     Stock shall be effective for such purpose, while the books for the

                                        - 4 -
<PAGE>







     transfer of either class of stock are closed for any purpose, but the
     surrender of such shares of the Preferred Stock for conversion during any
     period while such books are closed shall become effective for all purposes
     of conversion immediately upon the reopening of such books, as if the
     conversion had been made on the date such shares of Preferred Stock were
     surrendered.

          7.  Dilution.

          (a)  In case, at any time or from time to time after the date of
     issuance of the Preferred Stock ("Issuance Date"), the Corporation shall
     issue or sell shares of its Common Stock  (other than any Common Stock
     issued upon (i) conversion of the Corporation's (A) 12% Convertible
     Subordinated Debentures and (B) 12% Convertible Senior Subordinated
     Debentures (together "Debentures"), (ii) exercise of those certain Amended
     and Restated Series A Warrants dated March 7, 1996 to purchase 600,000
     shares of Common Stock ("Series A Warrants"), (iii) exercise by each of
     Murray H. Feigenbaum and Jerome Deutsch of his option to purchase 100,000
     shares of Common Stock at a price of $.10 per share ("Principals'
     Options"), (iv) exercise of those certain Amended and Restated Series B
     Warrants dated March 7, 1996 to purchase 1,500,000 shares of Common Stock
     ("Series B Warrants"),  (v) exercise of those certain Series C Warrants
     dated March 7, 1996 to purchase 2,542,380 shares of Common Stock ("Series
     C Warrants"), (vi) exercise of those certain Series D Warrants dated
     March 7, 1996 to purchase 2,830,200 shares of Common Stock ("Series D
     Warrants"), (vii) exercise of those certain Series E Warrants dated
     March 7, 1996 to purchase 1,000,000 shares of Common Stock ("Series E
     Warrants" and together with the Series A, B, C and D Warrants, "Warrants")
     and (viii) exercise of those certain Stock Options, dated March 7, 1996 to
     purchase 1,000,000 shares of Common Stock issued to Richard K. Laird
     ("Laird Options" and together with the Debentures, the Warrants, the
     Principals' Options and the Laird Options, the "Subject Securities") for a
     consideration per share less than $.27 per share ("Trigger Price"), or, if
     a Pro Forma Adjusted Trigger Price (hereinafter defined) shall be in
     effect as provided below in this paragraph 7, then less than such Pro
     Forma Adjusted Trigger Price per share, then and in each such case the
     holder of Preferred Stock, upon the conversion hereof as provided in
     paragraph (a) hereof, shall be entitled to receive, in lieu of the shares
     of  Common Stock theretofore receivable upon the conversion of the
     Preferred Stock, a number of shares of Common Stock determined by (a)
     dividing the Trigger Price by a Pro Forma Adjusted Trigger Price per share
     to be computed as provided below in this paragraph 7, and (b) multiplying
     the resulting quotient by the number of shares of Common Stock into which
     the Preferred Stock is convertible.  A Pro Forma Adjusted Trigger Price
     per share shall be the price computed (to the nearest cent, a fraction of
     half cent or more being considered a full cent):

               by dividing (i) the sum of (x) the result obtained by
               multiplying the number of shares of  Common Stock of the
               Corporation outstanding immediately prior to such issue or
               sale by the Trigger Price (or, if a Pro Forma Adjusted
               Trigger Price shall be in effect, by such Price), and (y)

                                        - 5 -
<PAGE>







               the consideration, if any, received by the Corporation upon
               such issue or sale, by (ii) the number of shares of  Common
               Stock of the Corporation outstanding immediately after such
               issue or sale.

          For the purpose of this paragraph 7:

               (1)       In case the Corporation splits its  Common Stock or
                    shall declare any dividend, or make any other distribution,
                    upon any stock of the Corporation of any class payable in 
                    Common Stock, or in any stock or other securities directly
                    or indirectly convertible into or exchangeable for  Common
                    Stock (any such stock or other securities being hereinafter
                    called "Convertible Securities"), such split, declaration
                    or distribution shall be deemed to be an issue or sale (as
                    of the record date for such split, dividend or other
                    distribution), without consideration, of such  Common Stock
                    or such Convertible Securities, as the case may be.

               (2)       In case the Corporation shall issue or sell any
                    Convertible Securities other than the Subject Securities,
                    there shall be determined the price per share for which 
                    Common Stock is issuable upon the conversion or exchange
                    thereof, such determination to be made by dividing (a) 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 (b) the maximum number
                    of shares of  Common Stock of the Corporation issuable upon
                    the conversion or exchange of all such Convertible
                    Securities.

               If the price per share so determined shall be less than the
     Trigger Price (or, if a Pro Forma Adjusted Trigger Price shall be in
     effect, less than such Pro Forma Adjusted Trigger Price) as of the date of
     such issue or sale, then such issue or sale shall be deemed to be an issue
     or sale for cash (as of the date of issue or sale of such Convertible
     Securities) of such maximum number of shares of  Common Stock at the price
     per share so determined, provided that, if such Convertible Securities
     shall by their terms provide for an increase or increases, with the
     passage of time, in the amount of additional consideration, if any,
     payable to the Corporation, or in the rate of exchange, upon the
     conversion or exchange thereof, the Pro Forma Adjusted Trigger Price per
     share shall, forthwith upon any such increase becoming effective, be
     readjusted to reflect the same, and provided, further, that upon the
     expiration of such rights of conversion or exchange of such Convertible
     Securities, if any thereof shall not have been exercised, the Pro Forma
     Adjusted Trigger Price per share shall forthwith be readjusted and
     thereafter be the price which it would have been had an adjustment been
     made on the basis that the only shares of  Common Stock so issued or sold
     were those issued or sold upon the conversion or exchange of such

                                        - 6 -
<PAGE>







     Convertible Securities, and that they were issued or sold for the
     consideration actually received by the Corporation upon such conversion or
     exchange, plus the consideration, if any, actually received by the
     Corporation for the issue or sale of all such Convertible Securities which
     shall have been converted or exchanged.

          (b)  In case the Corporation shall grant any rights or options to
     subscribe for, purchase or otherwise acquire  Common Stock of any class
     other than the Subject Securities, there shall be determined the price per
     share for which  Common Stock is issuable upon the exercise of such rights
     or options, such determination to be made by dividing (a) the total
     amount, if any, received or receivable by the Corporation as consideration
     for the granting of such rights or options, plus the minimum aggregate
     amount of additional consideration, if any, payable to the Corporation
     upon the exercise of such rights or options, by (b) the maximum number of
     shares of  Common Stock issuable upon the exercise of such rights or
     options.

               If the price per share so determined shall be less than the
     Trigger Price (or, if a Pro Forma Adjusted Trigger Price shall be in
     effect, less than such Price) as of the date of such issue or sale, then
     the granting of such rights or options shall be deemed to be an issue or
     sale for cash (as of the date of the granting of such rights or options)
     of such maximum number of shares of  Common Stock at the price per share
     so determined, provided that, if such rights or options shall by their
     terms provide for an increase or increases, with the passage of time, in
     the amount of additional consideration, if any, payable to the Corporation
     upon the exercise thereof, the Pro Forma Adjusted Trigger Price per share
     shall, forthwith upon any such increase becoming effective, be readjusted
     to reflect the same, and provided, further, that upon the expiration of
     such rights or options, if any thereof shall not have been exercised, the
     Pro Forma Adjusted Trigger Price per share shall forthwith be readjusted
     and thereafter be the price which it would have been had an adjustment
     been made on the basis that the only shares of  Common Stock so issued or
     sold were those issued or sold upon the exercise of such rights or options
     and that they were issued or sold for the consideration actually received
     by the Corporation upon such exercise, plus the consideration, if any,
     actually received by the Corporation for the granting of all such rights
     or options, whether or not exercised.

          (c)  In case the Corporation shall grant any rights or options to
     subscribe for, purchase or otherwise acquire Convertible Securities, such
     Convertible Securities shall be deemed, for the purposes of
     paragraph 7(a)(2) above, to have been issued or sold for the total amount
     received or receivable by the Corporation as consideration for the
     granting of such rights or options plus the minimum aggregate amount of
     additional consideration, if any, payable to the Corporation upon the
     exercise of such rights or options, provided that, upon the expiration of
     such rights or options, if any thereof shall not have been exercised, the
     Pro Forma Adjusted Trigger Price per share shall forthwith be readjusted
     and thereafter be the price which it would have been had an adjustment
     been made upon the basis that the only Convertible Securities so issued or

                                        - 7 -
<PAGE>







     sold were those issued or sold upon the exercise of such rights or options
     and that they were issued or sold for the consideration actually received
     by the Corporation upon such exercise, plus the consideration, if any,
     actually received by the Corporation for the granting of all such rights
     or options, whether or not exercised.

          (d)  In case any shares of stock or other securities, other than
     Common Stock of the Corporation, shall at any time be receivable upon the
     conversion of Preferred Stock, and in case any additional shares of such
     stock or any additional such securities (or any stock or other securities
     convertible into or exchangeable for any such stock or securities) shall
     be issued or sold for a consideration per share such as to dilute the
     purchase rights evidenced by Preferred Stock, then and in each such case
     the Pro Forma Adjusted Trigger Price per share shall forthwith be
     adjusted, substantially in the manner provided for above in this
     paragraph 7, so as to protect the holder of Preferred Stock against the
     effect of such dilution.

          (e)  In case any shares of  Common Stock or Convertible Securities or
     any rights or options to subscribe for, purchase or otherwise acquire any 
     Common Stock or Convertible Securities shall be issued or sold for cash,
     the consideration received therefor shall be deemed to be the amount
     received by the Corporation therefor, after deducting any expenses
     incurred and any underwriting or similar commissions, compensation or
     concessions paid or allowed by the Corporation in connection with such
     issue or sale.

          (f)  In case any shares of  Common Stock or Convertible Securities or
     any rights or options to subscribe for, purchase or otherwise acquire any 
     Common Stock or Convertible Securities shall be issued or sold for a
     consideration other than cash (or a consideration which includes cash, if
     any cash constitutes a part of the assets of a corporation or business
     substantially all of the assets of which are being received a such
     consideration) then, for the purpose of this paragraph 7(f), the Board of
     Directors of the Corporation shall promptly determine the fair value of
     such consideration, and such  Common Stock, Convertible Securities, rights
     or options shall be deemed to have been issued or sold on the date of such
     determination in good faith.  Such value shall not be more than the amount
     at which such consideration is recorded in the books of the Corporation
     for accounting purposes except in the case of an acquisition accounted for
     on a pooling of interest basis.  In case any  Common Stock or Convertible
     Securities or any rights or options to subscribe for, purchase or
     otherwise acquire any  Common Stock or Convertible Securities shall be
     issued or sold together with other stock or securities or other assets of
     the Corporation for a consideration which covers both, the Board of
     Directors of the Corporation shall promptly determine what part of the
     consideration so received is to be deemed to be the consideration for the
     issue or sale of such  Common Stock or Convertible Securities or such
     rights or options.

               The Corporation covenants and agrees that, should any
     determination of fair value of consideration or of allocation of

                                        - 8 -
<PAGE>







     consideration be made by the Board of Directors of the Corporation,
     pursuant to this paragraph 7(f), it will, not less than seven (7) days
     after any and each such determination, deliver to the holder of the
     Preferred Stock a certificate signed by the President or a Vice President
     and the Treasurer or an Assistant Treasurer of the Corporation reciting
     such value as thus determined and setting forth the nature of the
     transaction for which such determination was required to be made, the
     nature of any consideration, other than cash, for which  Common Stock,
     Convertible Securities, rights or options have been or are to be issued,
     the basis for its valuation, the number of shares of  Common Stock which
     have been or are to be issued, and a description of any Convertible
     Securities, rights or options which have been or are to be issued,
     including their number, amount and terms.

          (g)  In case the Corporation shall take a record of the holders of
     shares of its stock of any class for the purpose of entitling them (a) to
     receive a dividend or a distribution payable in  Common Stock or in
     Convertible Securities, or (b) to subscribe for, purchase or otherwise
     acquire  Common Stock or Convertible Securities, then such record date
     shall be deemed to be the date of the issue or sale of the  Common Stock
     issued or sold or deemed to have been issued or sold upon the declaration
     of such dividend or the making of such other distribution, or the date of
     the granting of such rights of subscription, purchase or other
     acquisition, as the case may be.

          (h)  The number of shares of  Common Stock outstanding at any given
     time shall include shares issuable in respect of scrip certificates issued
     in lieu of fractions of shares of  Common Stock, but shall exclude shares
     in the treasury of the Corporation.

          (i)  Following each computation or readjustment of a Pro Forma
     Adjusted Trigger Price as provided in this paragraph 7, the newly computed
     or adjusted Pro Forma Adjusted Trigger Price shall remain in effect until
     a further computation or readjustment thereof is required by this
     paragraph 7.

          (j)  In case at any time or from time to time after the Issuance Date
     the holders of the  Common Stock of the Corporation of any class (or any
     other shares of stock or other securities at the time receivable upon the
     conversion of Preferred Stock) shall have received, or, on or after the
     record date fixed for the determination of eligible stockholders, shall
     have become entitled to receive:

               (A)  other or additional stock or other securities or property
          (other than cash) by way of dividend;

               (B)  any cash paid or payable out of capital or paid-in surplus
          or surplus created as a result of a revaluation of property by way of
          dividend; or

               (C)  other or additional (or less) stock or other securities or
          property (including cash) by way of stock-split, spin-off, split-off,

                                        - 9 -
<PAGE>







          split-up, reclassification, combination of shares or similar
          corporate rearrangement;

     (other than additional shares of  Common Stock issued to holders of 
     Common Stock as a stock dividend or stock-split, adjustments in respect of
     which shall be covered by the provisions of this paragraph 7), then in
     each case the holder of the Preferred Stock, upon the conversion thereof
     as provided in paragraph 6, shall be entitled to receive, in lieu of, or
     in addition to, as the case may be, the shares theretofore receivable upon
     the conversion of the Preferred Stock, the amount of stock or other
     securities or property (including cash in the cases referred to in clauses
     (B) and (C) above) which such holder would hold on the date of such
     exercise if, on the Issuance Date, he, she or it had been the holder of
     record of the number of shares of Common Stock of the Corporation into
     which the Preferred Stock is convertible and had thereafter, during the
     period from the Issuance Date to and including the date of such
     conversion, retained such shares and/or all other or additional (or less)
     stock or other securities or property (including cash in the cases
     referred to in clauses (B) and (C) above) receivable by him, her or it as
     aforesaid during such period, giving effect to all adjustments called for
     during such period by paragraphs 7(a) and 7(k) hereof.

          (k)  In case of any reorganization of the Corporation (or any other
     corporation the stock or other securities of which are at the time
     deliverable on the conversion of the Preferred Stock) after the date
     hereof, or in case, after such date, the Corporation (or any such other
     corporation) shall consolidate with or merge into another corporation or
     convey all or substantially all its assets to another corporation, then
     and in each such case the holder of the Preferred Stock, upon the
     conversion thereof as provided in paragraph 6 hereof, at any time after
     the consummation of such reorganization, consolidation, merger or
     conveyance, shall be entitled to receive the stock or other securities or
     property to which such holder would have been entitled upon such
     consummation if such holder had converted the Preferred Stock immediately
     prior thereto, all subject to further adjustments as provided for herein;
     in each such case, the terms of the Preferred Stock shall be applicable to
     the shares of stock or other securities or property receivable upon the
     conversion of the Preferred Stock after such consummation.

          (l)  The Corporation will not, by amendment of its charter or through
     reorganization, consolidation, merger, dissolution, sale of assets or any
     other voluntary action, avoid or seek to avoid the observance or
     performance of any of the terms of the Preferred Stock, but will at all
     times in good faith assist in the carrying out of all such terms and in
     the taking of all such action as may be necessary or appropriate in order
     to protect the rights of the holder hereof against dilution or other
     impairment.  Without limiting the generality of the foregoing, the
     Corporation will not increase the par value of any shares of stock
     receivable upon the conversion of the Preferred Stock above the amount
     payable therefor upon such exercise, and at all times will take all such
     action as may be necessary or appropriate in order that the Corporation


                                        - 10 -
<PAGE>







     may validly and legally issue fully paid and non-assessable stock upon the
     conversion of the Preferred Stock.

          (m)  In each case of an adjustment in the number of shares of Common
     Stock or other stock, securities or property receivable on the conversion
     of the Preferred Stock, at the request of the holder of the Preferred
     Stock the Corporation at its expense shall promptly cause independent
     public accountants of recognized standing, selected by the Corporation, to
     compute such adjustment in accordance with the terms of the Preferred
     Stock and prepare a certificate setting forth such adjustment and showing
     in detail the facts upon which such adjustment is based, including a
     statement of (A) the consideration received or to be received by the
     Corporation for any additional shares issued or sold or deemed to have
     been issued or sold, (B) the number of shares of  Common Stock outstanding
     or deemed to be outstanding and (C) the Pro Forma Adjusted Trigger Price. 
     The Corporation will forthwith mail a copy of each such certificate to the
     holder of the Preferred Stock.

          (n)  In case:

               (A)  the Corporation shall take a record of the holders of its 
          Common Stock (or other stock or securities at the time deliverable
          upon the conversion of the Preferred Stock) for the purpose of
          entitling or enabling them to receive any dividend (other than a cash
          or stock dividend at the same rate as the rate of the last cash or
          stock dividend theretofore paid) or other distribution, or to
          exercise any preemptive right pursuant to the Corporation's charter,
          or to receive any right to subscribe for or purchase any shares of
          stock of any class or any other securities, or to receive any other
          right; or

               (B)  of any capital reorganization of the Corporation, any
          reclassification of the capital stock of the Corporation, any
          consolidation or merger of the Corporation with or into another
          corporation, or any conveyance of all or substantially all of the
          assets of the Corporation to another corporation; or

               (C)  of the voluntary or involuntary dissolution, liquidation or
          winding up of the Corporation;

     then, and in each such case, the Corporation will mail or cause to be
     mailed to the holder of the Preferred Stock a notice specifying, as the
     case may be, (i) the date on which a record is to be taken for the purpose
     of such dividend, distribution or right, and stating the amount and
     character of such dividend, distribution or right, or (ii) the date on
     which such reorganization, reclassification, consolidation, merger,
     conveyance, dissolution, liquidation or winding up is to take place, and
     the times, if any is to be fixed, as of which the holders of record of 
     Common Stock (or such other stock or securities at the time deliverable
     upon the exercise of the Preferred Stock) shall be entitled to exchange
     their shares of  Common Stock of any class (or such other stock or
     securities) for reclassification, consolidation, merger, conveyance,

                                        - 11 -
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     dissolution, liquidation or winding up or (iii) the amount and character
     of the stock or other securities proposed to be issued or granted, the
     date of such proposed issuance or grant and the persons or class of
     persons to whom such stock or other securities are to be offered, issued
     or granted.  Such notice shall be mailed at least thirty (30) days prior
     to the date therein specified.

          (o)  The Corporation shall, so long as any of the Preferred Stock is
     outstanding, reserve and keep available out of its authorized and unissued 
     Common Stock, solely for the purpose of effecting the conversion of the
     Preferred Stock, such number of shares of  Common Stock as shall from time
     to time be sufficient to effect the conversion of all shares of the
     Preferred Stock, then outstanding.  The Corporation shall from time to
     time increase its authorized  Common Stock and take such other action as
     may be necessary to permit the issuance from time to time of the shares of 
     Common Stock, as fully paid and nonassessable shares, upon the conversion
     of the  Preferred Stock, as herein provided.

          (p)  The Corporation shall pay any and all taxes which may be imposed
     upon it with respect to the issuance and delivery of  Common Stock upon
     the conversion of Preferred Stock as herein provided.  The Corporation
     shall not be required in any event to pay any transfer or other taxes by
     reason of the issuance of such  Common Stock in names other than those in
     which the Preferred Stock surrendered for conversion may stand, and no
     such conversion or issuance of  Common Stock shall be made unless and
     until the person requesting such issuance has paid to the Corporation the
     amount of any such tax, or has established to the satisfaction of the
     Corporation and its transfer agent, if any, that such tax has been paid. 
     Upon any conversion of Preferred Stock, as herein provided, no adjustment
     or allowance shall be made for dividends on the Preferred Stock, so
     converted, and all rights to dividends, if any, shall cease and be deemed
     satisfied, but nothing in this sentence shall be deemed to relieve the
     Corporation from its obligation to pay any dividends which shall have been
     declared and shall be payable to holders of Preferred Stock, of record as
     of a date prior to such conversion even though the payment date for such
     dividend is subsequent to the date of conversion.

















                                        - 12 -
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          (q)  Preferred Stock surrendered upon conversion thereof shall not be
     reissued and no  Preferred Stock shall be issued in lieu thereof or in
     exchange thereof.

          8.  Voting rights of preferred.  Except as herein or by law expressly
     provided,  the  Preferred Stock shall have no right or power to vote on
     any question or in any proceeding or to be represented at or to receive
     notice of any meeting of the stockholders.  Notwithstanding  the
     provisions of the preceding sentence, so long as any shares of  Preferred
     Stock are outstanding, the Corporation shall not, without the affirmative
     vote at a meeting (the notice of which shall state the general character
     of the matters to be submitted thereat), or the written consent with or
     without a meeting, of the holders of at least two thirds (66 2/3%) of the
     then outstanding shares of  Preferred Stock:

          (a)  increase the authorized amount of Preferred Stock, or authorize
     or create; or increase the authorized amount of, any additional class of
     stock ranking prior to or on a parity with the Preferred Stock as to
     dividends or assets; or authorize or create, or increase the authorized
     amount of, any class of stock or obligations convertible into or
     evidencing the right to purchase any class of stock ranking prior to or on
     a parity with the Preferred Stock as to dividends or assets; or

          (b)  amend, alter or repeal any of the provisions of the Certificate
     of Incorporation or any of the rights, preferences or powers of the
     outstanding Preferred Stock fixed herein or determined by the Board of
     Directors for any series of Preferred Stock as herein authorized; so as
     adversely to affect the rights, preferences or powers of the preferred
     stock or its holders; provided, however, that if any such amendment,
     alteration or repeal would adversely affect the rights, preferences or
     powers of outstanding shares of preferred stock of any particular series
     without correspondingly affecting the rights, preferences or powers of the
     outstanding shares of all series, then like vote or consent by the holders
     of at least two thirds (66 2/3%) of the Preferred Stock of that particular
     series at the time outstanding shall also be necessary for effecting or
     validating any such amendment, alteration or repeal; or

          (c)  sell, lease or convey all, or substantially all, of its property
     or business; or

          (d)  merge or consolidate with or into any other corporation or
     corporations, unless the corporation surviving or resulting from such
     merger or consolidation will have after such merger or consolidation no
     class of stock either authorized or outstanding ranking prior to or on a
     parity with the Preferred Stock as to dividends or assets except the same
     number of shares of Preferred Stock with the same rights, preferences and
     powers as the preferred stock of the Corporation authorized and
     outstanding immediately preceding such merger or consolidation, and unless
     each holder of Preferred Stock at the time of such merger or consolidation
     and in connection therewith shall continue to hold (in the case of a
     merger in which the Corporation is the surviving corporation) his shares

                                        - 13 -
<PAGE>







     of Preferred Stock, or (in the case of a consolidation or a merger of the
     Corporation into some other corporation) shall receive the same number of
     shares of Preferred Stock, with the same rights, preferences and powers,
     of such resulting Corporation; or 

          (e)  amend or repeal any of the provisions of this paragraph 8.

          9.  Registration Rights.  Within 90 days after the date of issuance
     of the Preferred Stock, the Corporation shall prepare and file a
     registration statement ("Registration Statement") with the Securities and
     Exchange Commission ("SEC") covering the shares of Common Stock issuable
     upon conversion of the Preferred Stock ("Registrable Securities"), and
     will use its best efforts to cause the Registration Statement to become
     effective within ninety (90) days following the date of such filing.  Once
     effective, the Corporation shall keep the Registration Statement effective
     for a period of seven (7) years from the date it is declared effective by
     the SEC.

               In the event (i) the registration Statement is not filed by the
     Corporation with the SEC on or prior to ninety (90) days after the date of
     issuance of the Preferred Stock or (ii) the Registration Statement has not
     been declared effective by the SEC on or prior to one hundred-eighty (180)
     days after the date of issuance of the Preferred Stock, the annual
     dividend rate on the Preferred Stock shall be increased to thirteen and
     one-half percent (13 1/2%) per annum for the first three (3) months
     immediately following the expiration of such ninety (90) day period or one
     hundred-eighty (180) day period, as the case may be, and by an additional
     one-half percent (1/2%) per annum at the beginning of each subsequent
     thirty (30) day period thereafter, until such time as the requirements of
     clause (i) or (ii) above, as the case may be, have been satisfied, at
     which time such dividend rate shall revert to the rate that otherwise
     would be in effect but for the operation of this sentence; PROVIDED,
     HOWEVER, that in no event shall the dividend rate applicable to the
     Preferred Stock exceed seventeen percent (17%) per annum pursuant to this
     sentence.

               Except as otherwise expressly stated herein, the following
     provisions shall be applicable to the Registration Statement:

          (a)  The Corporation will use its best efforts to cause the
     Registration Statement to become effective as promptly as possible within
     the time periods specified above, and if any stop order shall be issued by
     the SEC in connection therewith to use its reasonable efforts to obtain
     the removal of such order.  Following the effective date of the
     Registration Statement, the Corporation shall, upon the request of the
     holder, forthwith supply such reasonable number of copies of the
     Registration Statement, preliminary prospectus and prospectus meeting the
     requirements of the Securities Act, and other documents necessary or
     incidental to a public offering of the Registrable Securities, as shall be
     reasonably requested by the holder to permit the holder to make a public
     distribution of its, his or her Registrable Securities.  The Corporation
     will use its reasonable efforts to qualify the Registrable Securities for

                                        - 14 -
<PAGE>







     sale in such states as the holder of Registrable Securities shall
     reasonably request, provided that no such qualification will be required
     in any jurisdiction where, solely as a result thereof, the Corporation
     would be subject to service of general process or to taxation or
     qualification as a foreign corporation doing business in such
     jurisdiction.  The obligations of the Corporation hereunder with respect
     to the holder's Registrable Securities are expressly conditioned on the
     holder's furnishing to the Corporation such appropriate information
     concerning the holder, the holder's Registrable Securities and the terms
     of the holder's offering of such Registrable Securities as the Corporation
     may reasonably request.

          (b)  The Corporation shall pay all expenses incurred in complying
     with the provisions of this paragraph 9, including, without limitation,
     all registration and filing fees (including all expenses incident to
     filing with the National Association of Securities Dealers, Inc.),
     printing expenses, fees and disbursements of counsel to the Corporation,
     securities law and blue sky fees and expenses and the expenses of any
     regular and special audits incident to or required by any such
     registration.  All underwriting discounts and selling commissions
     applicable to the sales of the Registrable Securities, and any state or
     federal transfer taxes payable with respect to the sales of the
     Registrable Securities and all fees and disbursements of counsel for the
     holder, if any, in each case arising in connection with registration of
     the Registrable Securities shall be payable by the holder.

          (c)  In connection with the registration of the Registrable
     Securities pursuant to this paragraph 9, the Corporation shall indemnify
     and hold harmless the holder, its affiliates, officers, directors,
     partners, employees, agents and representatives, each person, if any, who
     controls the holder within the meaning of the Securities Act of 1933, as
     amended (the "Securities Act"), or the Securities Exchange Act of 1934, as
     amended (the "Exchange Act"), and any person claiming by or through any of
     them (collectively, the "Indemnified Persons") from and against all
     losses, claims, damages, expenses or liabilities (or actions in respect
     thereof) which arise out of or are based upon any untrue statement of any
     material fact contained in the Registration Statement or alleged untrue
     statement, under which such securities were registered under the
     Securities Act, any preliminary prospectus or final prospectus contained
     therein, or any amendment or supplement thereto, or arise out of or are
     based upon the omission to state therein a material fact required to be
     stated therein or necessary to make the statements made therein, in light
     of the circumstances under which they are made, not misleading, or any
     violation by the Corporation of the Securities Act, the Exchange Act or
     state securities or blue sky laws applicable to the Corporation and
     relating to action or inaction required of the Corporation in connection
     with such registration or qualification under such state securities or
     blue sky laws; and will reimburse the Indemnified Persons for any legal or
     any other expenses reasonably incurred by them in connection with
     investigating or defending any such loss, claim, damage, liability or
     action; PROVIDED, HOWEVER, that the Corporation will not be liable in any
     such case to any Indemnified Person to the extent that any such loss,

                                        - 15 -
<PAGE>







     claim, damage or liability arises out of or is based upon an untrue
     statement or omission made in the Registration Statement, said preliminary
     prospectus or said final prospectus or said amendment or supplement or any
     document incident thereto in reliance upon and in conformity with written
     information furnished to the Corporation by or on behalf of the holder.

          (d)  The holder will indemnify and hold harmless the Corporation and
     each person, if any, who controls the Corporation within the meaning of
     the Securities Act or the Exchange Act, each officer of the Corporation
     who signs the Registration Statement and each director of the Corporation
     from and against any and all such losses, claims, damages or liabilities
     arising from any untrue statement in, or omission from, the Registration
     Statement, any such preliminary or final prospectus, amendment, or
     supplement or document incident thereto if the statement or omission in
     respect of which such loss, claim, damage or liability is asserted was
     made in reliance upon and in conformity with information furnished in
     writing to the Corporation by or on behalf of the holder for use in
     connection with the preparation of the Registration Statement or such
     prospectus or amendment or supplement thereof.

          (e)  The reimbursements required by subparagraphs 9(c) and (d) shall
     be made by periodic payments during the course of the investigation or
     defense as and when bills are received or expenses incurred; PROVIDED,
     HOWEVER, that to the extent that an indemnified party receives periodic
     payments for legal or other expenses during the course of an investigation
     or defense, and such party subsequently received payments for such
     expenses from any other parties to the proceeding, such payments shall be
     used by the indemnified party to reimburse the indemnifying party for such
     periodic payments.  Any party which proposes to assert the right to be
     indemnified under subparagraphs 9(c) or (d) will, promptly after receipt
     of notice of commencement of any action, suit or proceeding against such
     party in respect of which a claim is to be made against any indemnified
     party hereunder, notify each such indemnifying party of the commencement
     of such action, suit or proceeding, enclosing a copy of all papers served,
     but the failure to so notify such indemnifying party of any such action,
     suit or proceeding shall not relieve the indemnifying party from any
     obligation which it may have to any indemnified party hereunder unless and
     only to the extent that the indemnifying party is prejudiced by said lack
     of notice.  In case any such action, suit or proceeding shall be brought
     against any indemnified party and it shall notify the indemnifying party
     of the commencement thereof, the indemnifying party shall be entitled to
     participate in and, to the extent that it shall wish, jointly with any
     other indemnifying party similarly notified, to assume the defense
     thereof, with counsel satisfactory to such indemnified party, and after
     notice from the indemnifying party to such indemnified party of its
     election so to assume the defense thereof, the indemnifying party shall
     not be liable to such indemnified party for any legal or other expense,
     other than reasonable costs of investigation subsequently incurred by such
     indemnified party in connection with the defense thereof.  The indemnified
     party shall have the right to employ its own counsel in any such action,
     but the reasonable fees and expenses of such counsel shall be at the
     expense of such indemnified party, when and as incurred, unless (A) the

                                        - 16 -
<PAGE>







     employment of counsel by such indemnified party has been authorized by the
     indemnifying party, (B) the indemnified party has reasonably concluded
     (based on advice of counsel), that there may be legal defenses available
     to it that are different from or in addition to those available to the
     indemnifying party, (C) the indemnified party shall have reasonably
     concluded (based on advice of counsel) that there may be a conflict of
     interest between the indemnifying party and the indemnified party in the
     conduct of defense of such action (in which case the indemnifying party
     shall not have the right to direct the defense of such action on behalf of
     the indemnified party), or (D) the indemnifying party shall not in fact
     have employed counsel to assume the defense of such action within 15 days
     after receipt of notice of such action.  An indemnifying party shall not
     be liable for any settlement or any action or claim effected without its
     consent.

          (f)  If the indemnification provided for in this paragraph 9 is
     unavailable to any indemnified party hereunder in respect of any losses,
     claims, damages, liabilities or expenses referred to therein, then the
     indemnifying party, in lieu of indemnifying such indemnified party, shall
     contribute to the amount paid or payable by such indemnified party as a
     result of such losses, claims, damages, liabilities or expenses in such
     proportion as is appropriate to reflect the relative fault of the
     indemnifying party and indemnified parties in connection with the actions
     that resulted in such losses, claims, damages, liabilities or expenses, as
     well as any other relevant equitable considerations.  The relative fault
     of such indemnifying party and indemnified parties shall be determined by
     reference to, among other things, whether any action in question,
     including any untrue or alleged untrue statement of a material fact or
     omission or alleged omission to state a material fact, has been made by,
     or relates to information supplied by, such indemnifying party or
     indemnified parties, and the parties' relative intent, knowledge, access
     to information and opportunity to correct or prevent such action.  The
     amount paid or payable by a party as a result of the losses, claims,
     damages, liabilities and expenses referred to above shall be deemed to
     include, subject to the limitations set forth herein, any legal or other
     fees or expenses reasonably incurred by such party in connection with any
     investigation or proceeding.

          (g)  The Corporation has determined that it would not be just and
     equitable if contribution pursuant to subparagraph 9(f) were determined by
     pro rata allocation or by any other method of allocation that does not
     take account of the equitable considerations referred to in the
     immediately preceding paragraph.  Notwithstanding any other provision
     hereof, in no event shall the contribution obligation of the indemnifying
     party be greater in amount than the excess of (A) the dollar amount of
     proceeds received by the indemnifying party upon the sale of the
     securities giving rise to such contribution obligation over (B) the dollar
     amount of any damages that the indemnifying party has otherwise been
     required to pay by reason of the untrue or alleged untrue statement or
     omission or alleged omission giving rise to such obligation.  No person
     guilty of fraudulent misrepresentation (within the meaning of


                                        - 17 -
<PAGE>







     Section 11(f) of the Securities Act) shall be entitled to contribution
     from any person who was not guilty of such fraudulent misrepresentation.

          (h)  Neither the filing of the Registration Statement by the
     Corporation nor the making of any request for prospectuses by the holder
     shall impose upon the holder any obligation to sell his, her or its
     Registrable Securities.

          (i)  The holder, upon receipt of notice from the Corporation that an
     event has occurred which requires a post-effective amendment to the
     Registration Statement or a supplement to the prospectus included therein,
     shall promptly discontinue the sale of his, her or its Registrable
     Securities until the holder receives a copy of a supplemented or amended
     prospectus from the Corporation, which the Corporation shall provide as
     soon as practicable after such notice.

          10.  Replacement of certificates.  Upon receipt of evidence
     reasonably satisfactory to the Corporation of the loss, theft, destruction
     or mutilation of the certificate of Preferred Stock and (in the case of
     loss, theft or destruction) upon delivery of an indemnity agreement (with
     surety if reasonably required) in an amount reasonably satisfactory to it,
     or (in the case of mutilation) upon surrender and cancellation thereof,
     the Corporation will issue, in lieu thereof, a new certificate of like
     tenor.





























                                        - 18 -
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