STATEMENT OF RESOLUTION
                     ESTABLISHING SERIES OF PREFERRED STOCK
                                       OF
                          TELSCAPE INTERNATIONAL, INC.


                            TO THE SECRETARY OF STATE
                             OF THE STATE OF TEXAS:

     Pursuant  to  the  provisions  of  Article  2.13  of  the  Texas  Business
Corporation  Act (the "TBCA"), the undersigned corporation submits the following
statement  for  the  purpose  of  amending  and  restating  the  preferred stock
designation  for  its  Class  D  Convertible  Senior  Preferred  Stock:

     A.     The  name  of  the  Company  is  Telscape  International,  Inc.

     B.     The  following resolution amending and restating the preferred stock
designation  for  the  Company's  Class D Convertible Senior Preferred Stock was
duly  adopted  by the Board of Directors of the Company as of December ___, 2000
and approved by a Supermajority of the outstanding shares of Class D Convertible
Senior  Preferred Stock, such Board and shareholder approval being all necessary
action  to  adopt  such  resolutions:

     "RESOLVED,  that  pursuant  to  the  authority granted to and vested in the
Board,  in  accordance  with the provisions of its Articles of Incorporation, as
amended,  a  series of Preferred Stock, with a par value of $0.001 per share, of
the Company be, and hereby is, established and given the distinctive designation
of  Class  D Convertible Senior Preferred Stock (the "Class D Preferred Stock").
This  series  consists  of  15,000 shares with the following relative rights and
preferences:

     Section  1.     Dividends.
                     ---------

          a.     Priority  of  Dividends.  No dividends shall be declared or set
                 -----------------------
aside for the Common Stock or any other class or series of the Company's capital
stock  which  ranks  junior  to  the  Class D Preferred Stock (collectively, the
"Junior Stock") unless prior thereto all accumulated and unpaid dividends on the
Class  D  Preferred Stock shall be declared, set aside and paid.  So long as any
Class  D  Preferred Stock remains outstanding, without the prior written consent
of  the  holders  of  sixty-six  and  two-thirds  percent  (66  2/3%)  (a
"Supermajority")  of  the  outstanding  shares  of  Class D Preferred Stock, the
Company  shall  not,  nor  shall  it  permit any of its subsidiaries to, redeem,
purchase or otherwise acquire directly or indirectly any Junior Stock, nor shall
the  Company  directly  or  indirectly  pay  or declare any dividend or make any
distribution  upon  any  Junior  Stock,  if  at the time of any such redemption,
purchase,  acquisition,  dividend  or distribution the Company has failed to pay
the  full  amount of dividends accumulated on the Class D Preferred Stock or the
Company  has  failed  to  make  any  redemption  of  the Class D Preferred Stock
required  hereunder.


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<PAGE>
          b.     If  the  Board of Directors determines to pay dividends due and
payable  pursuant to this Section 1 in cash, and in the event that funds legally
available  for  distribution  of such dividends on any Dividend Payment Date (as
defined  in  paragraph  (c) of this Section 1) are insufficient to fully pay the
cash  dividend  due  and payable on such Dividend Payment Date to all holders of
outstanding  Class  D  Preferred  Stock,  then  all  funds legally available for
distribution  shall  be  paid  in  cash to holders of Class D Preferred Stock in
accordance  with  the  number  of shares of Class D Preferred Stock held by each
such  holder.  Any  remaining  dividend  amount  owed  to holders of the Class D
Preferred  Stock  shall  be  accrued  in  accordance  with paragraph (c) of this
Section  1.  The  holders  of  the  Class  D  Preferred  Stock shall have senior
preference  and  priority  to the dividends of the Company over any Junior Stock
and pari passu with the Class C Convertible Senior Preferred Stock (the "Class C
    ---- -----
Preferred  Stock"), the Class E Convertible Senior Preferred Stock (the "Class E
Preferred Stock") and the Class F Convertible Senior Preferred Stock (the "Class
F  Preferred  Stock").

          c.     Stock  Dividend  Rate;  Dividend Payment Dates.  Each holder of
                 ----------------------------------------------
Class D Preferred Stock shall be entitled to receive when and as declared by the
Board,  out  of  funds  legally  available  therefor,  cumulative  dividends, in
preference  and  priority  to dividends on any Junior Stock, and pari passu with
                                                                 ---- -----
the  dividends  on  the Class C Preferred Stock, the Class E Preferred Stock and
the  Class F Preferred Stock that shall accrue daily, and compound quarterly, on
each  share  of  the Class D Preferred Stock at the rate of twelve percent (12%)
per  annum  (subject  to  adjustment  pursuant  to  Section 8) on the sum of the
Liquidation Price (as defined) thereof plus all accumulated and unpaid dividends
thereon,  from  and including the date on which such stock was first issued (the
"Original  Issue  Date") to and including the date on which such share ceases to
be  outstanding.  The accrued dividends will be appropriately adjusted for stock
splits,  stock  dividends,  combinations,  recapitalizations, reclassifications,
mergers,  consolidations  and  other  similar  events (each, a "Recapitalization
Event"  and  collectively, "Recapitalization Events") which affect the number of
outstanding  shares  of  the  Class D Preferred Stock.  Accrued dividends on the
Class D Preferred Stock shall be payable out of funds legally available therefor
on  June  30,  2000 and thereafter quarterly on September 30, December 31, March
31, and June 30 of each year (each a "Dividend Payment Date"), to the holders of
record  of  the  Class  D  Preferred  Stock  as  of the close of business on the
applicable  record  date.  Such  dividends shall accrue whether or not they have
been  declared  and  whether or not there are profits, surplus or other funds of
the  Company  legally available for the payment of dividends, and such dividends
shall  be  fully cumulative and shall accrue on a daily basis based on a 365-day
or  366-day  year,  as  the  case  may be, without regard to the occurrence of a
Dividend  Payment  Date and whether or not such dividends have been declared and
whether or not there are any unrestricted funds of the Company legally available
for the payment of dividends.  The amount of dividends "accrued" with respect to
any share of Class D Preferred Stock as of the first Dividend Payment Date after
the  Original  Issue Date, or as of any other date after the Original Issue Date


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<PAGE>
that  is  not  a  Dividend Payment Date, shall be calculated on the basis of the
actual number of days elapsed from and including the Original Issue Date, in the
case  of  the first Dividend Payment Date and any date of determination prior to
the  first  Dividend  Payment  Date,  or  from  and including the last preceding
Dividend  Payment  Date,  in the case of any other date of determination, to and
including  such date of determination which is to be made, in each case based on
a  year of 365 or 366 days, as the case may be.  Whenever the Board declares any
dividend  pursuant  to  this Section 1, notice of the applicable record date and
related  Dividend  Payment  Date  shall be given in accordance with Section 4(k)
hereof.

          d.     Pro  Rata  Declaration and Payment of Dividends.  All dividends
                 -----------------------------------------------
paid  with  respect  to  shares  of the Class D Preferred Stock pursuant to this
Section  1  shall be declared and paid pro rata to all the holders of the shares
                                       --- ----
of  Class  D  Preferred  Stock  outstanding  as  of  the applicable record date.

          e.     Payment  of  Dividends with Additional Shares.  Notwithstanding
                 ---------------------------------------------
any  other  provision of this Section 1, in the sole discretion of the Company's
Board of Directors, any dividends accruing on the Class D Preferred Stock may be
paid  in  lieu  of  cash  dividends  by  the issuance on the applicable Dividend
Payment  Date, ratably among the holders of Class D Preferred, of that number of
additional  shares  of  Class  D  Preferred  Stock (including fractional shares)
("Additional  Shares")  in an aggregate number equal to (i) the aggregate amount
of  the dividend to be paid divided by (ii) the Stated Value then existing as of
such  applicable  Dividend  Payment Date.  If and when any Additional Shares are
issued  under  this  Section  1(e)  for  the payment of accrued divi-dends, such
Additional  Shares  shall  be  deemed  to  be validly issued and outstanding and
fully-paid  and  nonassessable.

     Section  2.     Liquidation,  Dissolution  or  Winding  Up.
                     ------------------------------------------

          a.     In  the  event  of  any  voluntary  or involuntary liquidation,
dissolution  or  winding  up of the Company, any merger as a result of which the
majority  of  the  stockholders  of  the  Company  are  not  the majority of the
stockholders  of  the  surviving  entity,  or  consolidation of the Company with
another  entity (whether or not the Company is the surviving entity) or the sale
of substantially all of its assets (each such event, a "Liquidation"), except as
provided  in  paragraph  (b) of this Section 2, the holders of shares of Class D
Preferred Stock then outstanding shall be entitled, ratably in proportion to the
number of shares of Class D Preferred Stock held by such holders, to be paid out
of  the  assets  of  the  Company available for distribution to its stockholders
before  payment  to the holders of Junior Stock, and pari passu with the Class C
                                                     ---- -----
Preferred Stock, the Class E Preferred Stock and the Class F Preferred Stock, by
reason  of  their  ownership  thereof, an amount equal to $3,000.00 per share of
Class  D  Preferred  Stock  (subject  to  appropriate  adjustment  for  any
Recapitalization  Events)  (the  "Stated  Value"),  plus  an amount equal to all
accumulated  and unpaid dividends on such share of Class D Preferred Stock since
the  Original Issue Date thereof as of such time of determination (collectively,
the  "Liquidation  Price"  per share).  Upon such payment, the Class D Preferred
Stock  will  be  retired.

          b.     If  upon  any  such  Liquidation  the  remaining  assets of the
Company  available for distribution to its shareholders shall be insufficient to
pay  the  holders  of shares of Class D Preferred Stock the full amount to which
they  shall  be  entitled,  then  the  entire  assets  of  the  Company shall be
distributed  among  the holders of shares of Class D Preferred Stock and holders
of  all  other classes of preferred stock of the Company ranking pari passu with
                                                                 ---- -----
the  Class  D  Preferred  Stock as set forth above, ratably in proportion to the
full  amount  to  which  such  holders  are  entitled.


                                        3
<PAGE>
          c.     After  the  payment  of all preferential amounts required to be
paid  to  the  holders of Class D Preferred Stock and other classes of preferred
stock  as  set  forth  in paragraph b. above, upon a Liquidation, the holders of
shares  of  the  Junior  Stock then outstanding shall be entitled to receive the
remaining  assets  and  funds  of  the Company available for distribution to its
shareholders.

          d.     In the event of a distribution pursuant to this Section 2, such
distribution  shall  be paid in cash or in the event and to the extent that cash
is  not  available  for  distribution, in securities or property.  Whenever such
distribution  shall  be  in securities or property other than cash, the value of
such  securities  or  property other than cash shall be the fair market value of
such  securities  or  other  property as determined by the Board of Directors in
good  faith.

     Section  3.     Voting  Rights.
                     --------------

          a.     Each  holder  of  shares  of  Class  D Preferred Stock shall be
entitled  to  votes  equal  in the aggregate to the number of votes to which the
number  of  whole  shares  of  Common  Stock  into  which such shares of Class D
Preferred  Stock  held  by  such  holder  are  convertible would be entitled (as
adjusted from time to time pursuant to Section 4 hereof), at each meeting of the
shareholders of the Company (and for purposes of written actions of shareholders
in  lieu  of  meetings)  with  respect  to  any and all matters presented to the
shareholders  of  the  Company  for  their action or consideration, and shall be
entitled to notice of any shareholders' meeting in accordance with the Bylaws of
the Company.  Except as otherwise provided herein or required by law, holders of
shares  of  Class  D  Preferred  Stock  shall vote with the holders of shares of
Common  Stock  and  any other class of stock of the Company entitled to vote and
not as a separate class.  Holders of shares of the Class D Preferred Stock shall
have  the  right  to  vote  as  a  class  on all matters requiring their vote or
approval  under,  and in the manner set forth in, the TBCA.  Except as otherwise
provided  herein,  any  class vote pursuant to this Section 3 or required by law
shall  be  determined by the holders of a Supermajority of the shares of capital
stock  of  such  class  voting  as  a  class  as  of the applicable record date.

          b.     For  so  long  as  any shares of Class D Preferred Stock remain
outstanding,  the  Company  shall not amend, alter or repeal or otherwise change
any provision of these Articles of Incorporation, as amended (whether by merger,
consolidation  or  otherwise),  the  resolutions  of  its  Board authorizing and
designating  the  Class D Preferred Stock, or the preferences, special rights or
other  powers  of  the  Class  D  Preferred  Stock, in each case so as to affect
adversely  any  of  the rights, powers, preferences or privileges of the Class D
Preferred  Stock, without the written consent or affirmative vote of the holders
of  at least a Supermajority of the then outstanding shares of Class D Preferred
Stock,  given  in  writing or by vote at a meeting, consenting or voting (as the
case  may  be)  separately as a class, in person or by proxy.  For this purpose,


                                        4
<PAGE>
without  limiting  the  generality  of  the  foregoing, amendments, alterations,
repeals or other changes to any provision of these Articles of Incorporation, as
amended  (whether  by  merger, consolidation or otherwise), considered to affect
adversely  any  of  the rights, powers, preferences or privileges of the Class D
Preferred  Stock  shall  include,  but  are  not  limited  to: (i) the creation,
authorization,  issuance, or increase in the authorized amount of, any preferred
stock  (except  for increases in the authorized amount of and issuance of shares
of  Class  D Preferred Stock solely for the purpose of paying dividends pursuant
to  Section  1(e) hereof) or any other class or series of any equity securities,
or  any  warrants,  options or other rights convertible or exchangeable into any
class  or series of any equity securities of the Company, having a preference or
priority  over  or ranking pari passu with the Class D Preferred Stock as to the
                           ---- -----
right  to  receive  dividends  or  amounts distributable upon Liquidation of the
Company;  (ii)  those  that  reduce  the dividend rates on the Class D Preferred
Stock  or  cancel  accumulated and unpaid dividends; (iii) those that change the
relative  seniority  rights  of the holders of the Class D Preferred Stock as to
the  payment  of dividends in relation to the holders of any other capital stock
of  the  Company; or (iv) those that reduce the amount payable to the holders of
the  Class  D  Preferred Stock upon a Liquidation or change the seniority of the
liquidation  preferences  of the holders of the Class D Preferred Stock relative
to  the  rights  upon a Liquidation of the holders of any other capital stock of
the  Company.

          c.     In  addition  to  and  distinct  from  the matters described in
Sections  3(a) and 3(b) above, holders of the Class D Preferred Stock shall have
the  right  to designate two individuals to be members of the Board of Directors
with  each  of Sandler (as defined) and Pensat (as defined), having the right to
designate  one of such two individuals to be a member of the Board of Directors.
Each director duly designated to the Board of Directors by Sandler and Pensat in
accordance  with  this  Section  3(c)  shall  be  subject to removal only at the
request  of Sandler and Pensat, respectively.  If Sandler or Pensat, as the case
may  be, for any reason fails to designate anyone to fill any such directorship,
such  position  shall remain vacant until such time as Sandler or Pensat, as the
case may be, designates a director to fill such position and shall not be filled
by  resolution  or  vote  of  the  Board  of  Directors  or  the Company's other
shareholders.  For  purposes  of  this  Section  3, "Sandler" shall mean Sandler
Capital  Partners  IV, L.P. ("SCP IV") and Sandler Capital Partners IV FTE, L.P.
("SCP  IV  FTE") (together with their respective Affiliates (as defined)), or in
the  event  that  none  of  SCP IV or SCP IV FTE (together with their respective
Affiliates)  holds  at least 35% in the aggregate of the Class D Preferred Stock
originally  issued to them, those holders holding more than 50% in the aggregate
of  the  Class  D Preferred Stock originally issued to Sandler.  For purposes of
this Section 3, "Pensat" shall mean Oger Pensat Holdings Ltd. (together with its
respective  Affiliates) or in the event Oger Pensat Holdings Ltd. (together with
its  respective  Affiliates) does not hold at least 35% of the Class D Preferred
Stock  originally  issued  to  Oger  Pensat  Holdings  Ltd.(together  with  its
respective  Affiliates), those holders holding more than 50% in the aggregate of
the  Class  D  Preferred  Stock  originally  issued to Oger Pensat Holdings Ltd.
(together  with  its respective Affiliates).  "Affiliate" means, with respect to
any  individual,  corporation,  association,  partnership, joint venture, trust,
estate,  limited  liability  company, limited liability partnership, joint stock
company,  unincorporated  organization  or government or any agency or political
subdivision  thereof,  or  other  entity or organization (each, a "Person"), any
Person  that,  directly  or  indirectly,  controls, is controlled by or is under
common  control  with  such  first-named  Person.  For  the  purposes  of  this
definition,  "control"  (including  with  correlative  meanings,  the  terms
"controlled  by"  and  "under  common  control with") shall mean the possession,
directly  or  indirectly,  of  the power to direct or cause the direction of the
management  and policies of such Person, whether through the ownership of voting
securities  or  by  contract  or  otherwise.


                                        5
<PAGE>
     Section  4.     Conversion  at  the  Option  of  a  Holder.
                     ------------------------------------------

     The  holders of the Class D Preferred Stock shall have conversion rights as
follows  (the  "Conversion  Rights"):

          a.     Right  to Convert.  Each share of Class D Preferred Stock shall
                 -----------------
be  convertible  at  the  option  of  the holder thereof, at any time, into such
number  of  fully-paid and nonassessable shares of Common Stock as determined by
dividing  the Conversion Value (as defined) by the Conversion Price (as defined)
then  in  effect  (as appropriately adjusted in accordance with this Section 4).
No additional consideration shall be paid by a holder of Class D Preferred Stock
upon  exercise  of  its  respective Conversion Rights pursuant to this paragraph
(a).

               i.     Conversion  Value.  The  "Conversion Value" for each share
                      -----------------
of  Class  D Preferred Stock shall be the Liquidation Price per share of Class D
Preferred  Stock.

               ii.     Conversion  Price.  The  conversion price at which shares
                       -----------------
of  Common Stock shall be deliverable upon conversion of Class D Preferred Stock
without  the  payment  of  additional  consideration by the holder thereof shall
initially be $6.26 (the "Conversion Price").  Such initial Conversion Price (and
therefore  the corresponding rate at which shares of Class D Preferred Stock may
be  converted  into  shares  of Common Stock), shall be subject to adjustment as
provided  in  this  Section  4.

               iii.     Fractional Shares.  No fractional shares of Common Stock
                        -----------------
shall  be issued upon conversion of the Class D Preferred Stock.  In lieu of any
fractional  shares  to which a holder of Class D Preferred Stock would otherwise
be entitled, the Company shall pay cash equal to such fraction multiplied by the
then  effective  Conversion  Price.

          c.     Mechanics  of  Conversion.
                 -------------------------

               i.       In  order  for  a  holder  of Class D Preferred Stock to
convert  shares  of  Class  D  Preferred Stock into shares of Common Stock, such
holder  shall surrender the certificate or certificates for such shares of Class
D  Preferred Stock at the office of the transfer agent for the Class D Preferred
Stock  (or  at  the principal office of the Company if the Company serves as its
own  transfer  agent),  together  with written notice that such holder elects to
convert  all  or any number of the shares of Class D Preferred Stock represented
by  such  certificate  or  certificates and stating therein the name or names in
which  the  holder  desires  the  certificate  or certificates for shares of the
Common Stock to be issued.  If required by the Company, certificates surrendered
for  conversion  shall  be  endorsed  or  accompanied by a written instrument or
instruments  of  transfer, in form satisfactory to the Company, duly executed by
the  registered  holder or his or its attorney duly authorized in writing.  Each
date of receipt of such certificates and notice by the transferring agent (or by
the  Company  if  the  Company  serves  as  its  own  transfer agent) shall be a


                                        6
<PAGE>
conversion  date  (each,  a  "Conversion  Date").  The Company shall, as soon as
practicable  after each Conversion Date and no later than two (2) days after the
Conversion  Date, (i) issue and deliver at such office to such holder of Class D
Preferred  Stock,  a  certificate  or  certificates  for the number of shares of
Common  Stock to which such holder shall be entitled as aforesaid, together with
cash  in lieu of any fraction of a share in accordance with paragraph (b) above,
or  (ii)  in lieu of delivering physical certificates representing the shares of
Common  Stock,  provided  the  Company's  transfer agent is participating in the
Depositary  Trust  Issuer  Fast  Automated Securities Transfer ("FAST") program,
upon  request of the holder, the Company shall use its best efforts to cause its
transfer  agent  to  electronically transmit the shares of Common Stock issuable
upon  conversion  of  the Class D Preferred Stock to the holder by crediting the
account  of  the holder's prime broker with Depositary Trust Company through its
Deposit  Withdrawal Agent Commission system.  Such conversion shall be deemed to
have  been  made  immediately  prior  to the close of business on the applicable
Conversion Date, and the person entitled to receive certificates of Common Stock
on  such  date shall be regarded for all corporate purposes as the holder of the
number  of shares of Common Stock to which it is entitled upon the conversion on
such  Conversion  Date.

               ii.     The  Company  shall, at all times when any of the Class D
Preferred  Stock shall remain outstanding, reserve and keep available out of its
authorized  but  unissued  stock, for the purpose of effecting the conversion of
the Class D Preferred Stock, such number of its duly authorized shares of Common
Stock  as  shall from time to time be sufficient to effect the conversion of all
outstanding  Class  D  Preferred  Stock.

               iii.     All  shares  of Class D Preferred Stock which shall have
been  surrendered for conversion as herein provided shall no longer be deemed to
be  outstanding  and  all  rights  with respect to such shares shall immediately
cease and terminate on the Conversion Date, except only the right of the holders
thereof  to receive shares of Common Stock and cash in lieu of fractional shares
in  exchange therefor.  Any shares of Class D Preferred Stock so converted shall
be retired and canceled and shall not be reissued, and the Company may from time
to  time  take  such  appropriate  action  as  may  be  necessary  to reduce the
authorized  Class  D  Preferred  Stock,  accordingly.

          d.     Adjustments  to  Conversion  Price  for  Diluting  Issues.
                 ---------------------------------------------------------

               i.     Special  Definitions.  For  purposes of this Section 4(d),
                      --------------------
the  following  definitions  shall  apply:

                    (1)     "Option"  shall  mean rights, options or warrants to
subscribe  for,  purchase  or  otherwise  acquire  Common  Stock  or Convertible
Securities  (as  defined), excluding (1) options granted to employees, officers,
directors  or  consultants  of  the  Company  or  rights,  warrants,  or  other
convertible  securities  which,  in  each  case, are outstanding as of the First
Issue  Date  (as  defined),  (2)  any warrants issued in connection with or as a
direct  result  of  the  consummation of the merger contemplated by that certain
Amended  and  Restated  Agreement  and  Plan of Merger by and among the Company,
Pointe  Acquisition Corp., and Pointe Communications  Corporation dated December
31,  1999  (the "Merger Agreement"), (3) options granted to employees, officers,
directors  or  consultants  pursuant to stock option plans existing on the First
Issue Date or adopted by the Board of Directors and approved by the Compensation
Committee  of  the  Board  of  Directors  after the First Issue Date, or (4) any
warrants  issued in connection with the issuance of the Company's Class G Senior
Preferred  Stock,  par  value  $0.001 per share (the "Class G Preferred Stock").


                                        7
<PAGE>
                    (2)     "First  Issue  Date"  shall  mean  the first date on
which  shares  of  Class  D  Preferred  Stock  were  first  issued.

                    (3)     "Convertible Securities" shall mean any evidences of
indebtedness,  shares  or  other securities other than options excluded from the
definition  of  "Option" in subparagraph (A) of this Section 4(d)(i) directly or
indirectly  convertible  into  or  exchangeable  for  Common  Stock.

                    (4)     "Additional  Shares  of Common Stock" shall mean all
shares  of Common Stock issued (or, pursuant to subparagraph (iii) below, deemed
to  be  issued)  by the Company after the First Issue Date, other than shares of
Common  Stock  issued  or  issuable:

                         (a)     upon  the  conversion  of  shares  of  Class  D
Preferred  Stock  outstanding;

                         (b)     as  a  dividend  or  distribution  on  Class  D
Preferred  Stock;

(c)     by  reason of a dividend, stock split, split-up or other distribution on
shares  of  the  Class  D  Preferred  Stock  or  Common  Stock;

                         (d)     upon  the exercise of options excluded from the
definition  of  "Option"  in  subparagraph  (A)  of  this  Section  4(d)(i);  or

                         (e)     in  connection  with  an  acquisition  or other
transaction by the Company, in either case approved by the holders of at least a
Supermajority  of  the  then  outstanding shares of the Class D Preferred Stock,
unless  the  Company  agrees  to  include  such  issuance  in  the definition of
"Additional Shares of Common Stock" in connection with obtaining the approval of
the  holders  of  at least a Supermajority of the then outstanding shares of the
Class  D  Preferred  Stock  to  such  acquisition  or  other  transaction;  or

                         (f)     by  reason of a dividend, stock split, split-up
or  other distribution on shares of Common Stock excluded from the definition of
"Additional  Shares of Common Stock" by the foregoing clauses (1), (2), (3), (4)
and  (5)  or  this  clause  (6).


                                        8
<PAGE>
                    ii.     No Adjustment of Conversion Price.  No adjustment in
                            ---------------------------------
the  number  of shares of Common Stock into which the Class D Preferred Stock is
convertible  shall  be made, by adjustment in the Conversion Price thereof:  (A)
unless  the  consideration  per  share  (determined pursuant to subparagraph (v)
below)  for  an  Additional  Share of Common Stock issued or deemed to be issued
pursuant  to subparagraph (iii) below by the Company is less than the Conversion
Price  in  effect immediately prior to, the issuance of such Additional Share of
Common  Stock,  or  (B)  if prior to such issuance, the Company receives written
notice  from  the  holders  of  at least a Supermajority of the then outstanding
shares of Class D Preferred Stock agreeing that no such adjustment shall be made
as  the  result  of  the  issuance  of  such  Additional Shares of Common Stock.

                    iii.     Issue  of  Securities  Deemed  Issue  of Additional
                             ---------------------------------------------------
Shares  of  Common Stock.  If the Company at any time or from time to time after
    --------------------
the First Issue Date shall issue any Options or Convertible Securities, then the
maximum  number  of  shares  of  Common  Stock  (as  set forth in the instrument
relating  thereto  without  regard  to  any  provision  contained  therein for a
subsequent adjustment of such number) issuable upon the exercise of such Options
or,  in  the case of Convertible Securities and Options therefor, the conversion
or  exchange  of  such  Convertible Securities, shall be deemed to be Additional
Shares  of  Common  Stock  issued as of the time of such issuance, provided that
Additional Shares of Common Stock shall not be deemed to have been issued unless
the  consideration  per share (determined pursuant to subparagraph (v) below) of
such  Additional  Shares of Common Stock would be less than the Conversion Price
in  effect  immediately prior to such issuance, and provided further that in any
such  case  in  which Additional Shares of Common Stock are deemed to be issued:

                         (1)     No  further  adjustment in the Conversion Price
shall  be  made upon the subsequent issuance of Convertible Securities or shares
of  Common  Stock upon the exercise of such Options or conversion or exchange of
such  Convertible  Securities;

                         (2)     If  such  Options  or Convertible Securities by
their  terms provide, with the passage of time or otherwise, for any increase in
the consideration payable to the Company, or decrease in the number of shares of
Common  Stock  issuable,  upon the exercise, conversion or exchange thereof, the
conversion price computed upon the original issuance thereof, and any subsequent
adjustments  based  thereon,  shall, upon any such increase or decrease becoming
effective,  be  recomputed  to  reflect  such increase or decrease insofar as it
affects  such  Options  or  the  rights  of  conversion  or  exchange under such
Convertible  Securities;

                         (3)     No  readjustment  pursuant  to clause (B) above
shall  have  the  effect  of  increasing the Conversion Price to an amount which
exceeds  the  Conversion  Price  on  the  original  adjustment  date;  and

                         (4)     In  the  event  of  any change in the number of
shares of Common Stock issuable upon the exercise, conversion or exchange of any
Option  or  Convertible  Security,  including,  but  not  limited  to,  a change
resulting  from  the anti-dilution provisions thereof, the Conversion Price then
in  effect  shall forthwith be readjusted to such Conversion Price as would have
obtained  had the adjustment which was made upon the issuance of any such Option
or  Convertible Security which had not been exercised or converted prior to such
change been made upon the basis of such change in the number of shares of Common
Stock, but no further adjustment shall be made for the actual issuance of Common
Stock  upon  the  exercise  or  conversion  of  any  such  Option or Convertible
Security.


                                        9
<PAGE>
                         (5)     Upon  the expiration of any such Options or any
rights  of  conversion or exchange under such Convertible Securities which shall
not  have  been exercised, the Conversion Price computed upon the original issue
date  thereof,  and  any  subsequent adjustments based thereon, shall, upon such
expiration,  be  recomputed  as  if:

                              (a)     in  the  case of Convertible Securities or
Options for Common Stock, the only Additional Shares of Common Stock issued were
the  shares  of  Common Stock, if any, actually issued upon the exercise of such
Options  or  the  conversion  or exchange of such Convertible Securities and the
consideration  received  therefor was the consideration actually received by the
Company  upon such exercise; or for the issue of all such Convertible Securities
which  were  actually converted or exchanged, plus the additional consideration,
if  any,  actually received by the Company upon such conversion or exchange; and

                              (b)     in  the  case  of  Options for Convertible
Securities,  only  the  Convertible Securities, if any, actually issued upon the
exercise  thereof  were  issued  at  the  time of issue of such Options, and the
consideration  received by the Company for the Additional Shares of Common Stock
deemed  to  have been then issued was the consideration actually received by the
Company  for  the  issue of all such Options, whether or not exercised, plus the
consideration  deemed to have been received by the Company upon the issue of the
Convertible  Securities  with  respect  to  which  such  Options  were  actually
exercised.

                    iv.     Adjustment  of  Conversion  Price  Upon  Issuance of
                            ----------------------------------------------------
Additional  Shares  of Common Stock.  In the event the Company shall at any time
    -------------------------------
after  the  First  Issue Date issue Additional Shares of Common Stock (including
Additional  Shares  of Common Stock deemed to be issued pursuant to subparagraph
(iii)  above,  but  excluding  shares  issued  as  a dividend or distribution as
provided in paragraph (f) below or upon a stock split or combination as provided
in  paragraph  (e) below), for a consideration per share (determined pursuant to
subparagraph  (v)  below)  less  than the Conversion Price in effect immediately
prior  to such issuance, then and in each such case, such Conversion Price shall
be  reduced, concurrently with such issuance, to a Conversion Price equal to the
price  determined  by  dividing  (a)  the  sum  of  (1)  the  product derived by
multiplying the Conversion Price in effect immediately prior to such issuance by
the  number  of  shares  of  Common  Stock outstanding immediately prior to such
issuance  (together with the number of shares of Common Stock then issuable upon
conversion  of  the  outstanding  shares  of  Class  D  Preferred  Stock and the
conversion  or  exercise of any Convertible Securities or Options), plus (2) the
aggregate  consideration  received  by  the  Company  (as determined pursuant to
subparagraph  (v)  below)  upon  such  issuance,  by (b) the number of shares of
Common  Stock  outstanding  immediately  after  such issuance (together with the
number  of  shares  of  Common  Stock  then  issuable  upon  conversion  of  the
outstanding  shares of Class D Preferred Stock and the conversion or exercise of
any  Convertible  Securities  or  Options).


                                       10
<PAGE>
               No  adjustment of the Conversion Price, however, shall be made in
an  amount  less  than  $.01  per share, and any such lesser adjustment shall be
carried  forward  and  shall  be  made  at  the  time and together with the next
subsequent  adjustment  which  together  with any adjustments so carried forward
shall amount to $.01 per share or more.  Any adjustments to the Conversion Price
shall  be  rounded  to  the  nearest  $.01  per  share.

               v.     Determination  of  Consideration.  For  purposes  of  this
                      --------------------------------
Section  4(d), the consideration received by the Company for the issuance of any
Additional  Shares  of  Common  Stock  shall  be  computed  as  follows:

                    (1)     Cash  and  Property.  Such  consideration  shall:
                            -------------------

                         (a)     insofar  as it consists of cash, be computed at
the aggregate of cash received by the Company, excluding amounts paid or payable
for  accrued  interest  or  accrued  dividends;

                         (b)     insofar  as  it consists of property other than
cash, be computed at the fair market value thereof at the time of such issuance,
as  is  reasonably  determined  in  good  faith  by  the Board of Directors; and

                         (c)     in  the event Additional Shares of Common Stock
are  issued  together  with  other  shares  of securities or other assets of the
Company  for  consideration  which  covers  both,  be  the  proportion  of  such
consideration so received, computed as provided in clauses (1) and (2) above, as
is  reasonably  determined  in  good  faith  by  the  Board  of  Directors.

                    (2)     Options  and  Convertible  Securities.  The
                            -------------------------------------
consideration  per share received by the Company for Additional Shares of Common
Stock  deemed to have been issued pursuant to subparagraph (iii) above, relating
to  Options  and  Convertible  Securities,  shall  be  determined  by  dividing:

                         (a)     the  total  amount,  if  any,  received  or
receivable  by  the Company as consideration for the issuance of such Options or
Convertible  Securities,  plus  the  minimum  aggregate  amount  of  additional
consideration  (as set forth in the instruments relating thereto, without regard
to  any  provision  contained  therein  for  a  subsequent  adjustment  of  such
consideration)  payable  to the Company upon the exercise of such Options or the
conversion or exchange of such Convertible Securities, or in the case of Options
for  Convertible  Securities,  the  exercise  of  such  Options  for Convertible
Securities  and  the  conversion  or exchange of such Convertible Securities, by

                         (b)     the  maximum  number  of shares of Common Stock
(as  set  forth  in  the  instruments  relating  thereto,  without regard to any
provision contained therein for a subsequent adjustment of such number) issuable
upon  the  exercise  of  such  Options  or  the  conversion  or exchange of such
Convertible  Securities.

          e.     Adjustment  for  Stock Splits and Combinations.  If the Company
                 ----------------------------------------------
shall  at  any  time  or  from  time to time after the First Issue Date effect a
subdivision of the outstanding Common Stock, the Conversion Price then in effect
immediately  before that subdivision shall be proportionately decreased.  If the
Company  shall  at  any  time  or  from  time to time after the First Issue Date
combine  the  outstanding  shares  of Common Stock, the Conversion Price then in
effect  immediately  before  the combination shall be proportionately increased.
Any  adjustment  under  this  paragraph  shall  become effective at the close of
business  on  the  date  the  subdivision  or  combination  becomes  effective.


                                       11
<PAGE>
          f.     Adjustment  for  Certain  Dividends  and  Distributions. In the
                 -------------------------------------------------------
event  the Company at any time, or from time to time after the First Issue Date,
shall  make  or  issue  a  dividend  or other distribution payable in additional
shares of Common Stock, then and in each such event the Conversion Price then in
effect  shall  be  decreased as of the time of such issuance, by multiplying the
Conversion  Price  then  in  effect  by  a  fraction:

               (1)     the  numerator  of  which  shall  be  the total number of
shares  of  Common Stock issued and outstanding immediately prior to the time of
such  issuance  or  the  close  of  business  on  such  record  date,  and

               (2)     the  denominator  of  which  shall be the total number of
shares  of  Common Stock issued and outstanding immediately prior to the time of
such  issuance  or  the close of business on such record date plus the number of
shares  of  Common  Stock  issuable in payment of such dividend or distribution;
provided,  however,  if such record date shall have been fixed and such dividend
is  not  fully  paid or if such distribution is not fully made on the date fixed
therefor,  the  Conversion Price shall be recomputed accordingly as of the close
of  business  on  such  record date and thereafter the Conversion Price shall be
adjusted  pursuant  to  this  paragraph as of the time of actual payment of such
dividends  or  distributions.

          g.     Adjustments  for  Other  Dividends  and  Distributions.  In the
                 ------------------------------------------------------
event  the  Company  at any time or from time to time after the First Issue Date
shall  make  or  issue a dividend or other distribution payable in securities of
the  Company  other  than  shares  of  Common Stock, then and in each such event
provision shall be made so that the holders of the Class D Preferred Stock shall
receive  upon  conversion  thereof in addition to the number of shares of Common
Stock  receivable  thereupon,  the amount of securities of the Company that they
would have received had their Class D Preferred Stock been converted into Common
Stock  on  the date of such event and had thereafter, during the period from the
date  of  such  event  to  and  including  the  conversion  date,  retained such
securities receivable by them as aforesaid during such period giving application
to  all  adjustments  called  for  during  such period under this paragraph with
respect  to  the  rights  of  the  holders  of  the  Class  D  Preferred  Stock.

          h.     Adjustment for Reclassification, Exchange, or Substitution.  If
                 ----------------------------------------------------------
the  Common  Stock  issuable  upon the conversion of the Class D Preferred Stock
shall  be  changed into the same or a different number of shares of any class or
classes  of  stock,  whether  by  capital  reorganization,  reclassification  or
otherwise  (other  than a subdivision or combination of shares or stock dividend
provided  for  above,  or  a  reorganization,  merger, consolidation, or sale of
assets  provided for below), then and in each such event the holder of each such
share of Class D Preferred Stock shall have the right thereafter to convert such
share  into  the  kind  and  amount  of shares of stock and other securities and
property receivable upon such reorganization, reclassification, or other change,
by  holders  of  the  number of shares of Common Stock into which such shares of
Class  D  Preferred  Stock  might  have been converted immediately prior to such
reorganization,  reclassification,  or change, all subject to further adjustment
as  provided  herein.


                                       12
<PAGE>
          i.     Adjustment  for  Merger  or  Reorganization.  In  case  of  any
                 -------------------------------------------
consolidation  or  merger  of the Company with or into another corporation, each
share  of  Class D Preferred Stock shall thereafter be convertible into the kind
and  amount of shares of stock or other securities or property to which a holder
of  the  number  of  shares  of  Common  Stock  of  the Company deliverable upon
conversion  of  such  Class D Preferred Stock would have been entitled if it had
converted  its shares immediately prior to such consolidation or merger; and, in
such  case,  appropriate adjustment (as determined in good faith by the Board of
Directors)  shall be made in the application of the provisions in this Section 4
set  forth  with respect to the rights and interest thereafter of the holders of
the  Class  D  Preferred Stock, to the end that the provisions set forth in this
Section 4 (including provisions with respect to changes in and other adjustments
of the Conversion Price) shall thereafter be applicable, as nearly as reasonably
may  be  practicable,  in  relation  to  any  shares  of stock or other property
thereafter  deliverable  upon  the  conversion  of  the Class D Preferred Stock.

          j.     No  Impairment.  The  Company  will  not, by amendment of these
                 --------------
Articles  of  Incorporation  or  through any reorganization, transfer of assets,
consolidation,  merger,  dissolution,  issue  or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the  terms to be observed or performed hereunder by the Company, but will at all
times  in  good  faith  assist in the carrying out of all the provisions of this
Section  4  and  in  the  taking  of  all  such  action  as  may be necessary or
appropriate  in  order  to  protect  the Conversion Rights of the holders of the
Class  D  Preferred  Stock.

          k.     Notice  of  Record  Date.  In  the  event:
                 ------------------------

               i.     that  the  Company shall propose to declare a dividend (or
any  other distribution) on its Common Stock, whether payable in cash, property,
Common  Stock  or other securities of the Company, whether or not a regular cash
dividend  and  whether  or  not  out  of  earnings  or  earned  surplus;

               ii.     that  the  Company  shall propose to subdivide or combine
its  outstanding  shares  of  Common  Stock;

               iii.     that  the  Company  shall  propose  to  effect  any
reclassification  or  recapitalization  of  the  Common  Stock  of  the  Company
outstanding  (other  than a subdivision or combination of its outstanding shares
of  Common  Stock  or  a  stock  dividend or stock distribution thereon), or any
consolidation  or  merger  of  the  Company into or with another corporation; or

               iv.     that  the Company shall propose to effect the Liquidation
of  the  Company;


                                       13
<PAGE>
then  in connection with each such event, the Company shall cause to be filed at
its  principal  office  or  at  the  office of the transfer agent of the Class D
Preferred Stock and shall cause to be mailed to each of the holders of the Class
D Preferred Stock at their last addresses as shown on the records of the Company
or  such  transfer  agent,  at  least  ten  (10)  days  prior to the record date
specified in (1) below or at least twenty (20) days before the date specified in
(2)  below,  a  notice  stating:

                    (1)     the  record  date  of  such  dividend, distribution,
subdivision  or  combination, or, if a record is not to be taken, the date as of
which  the  holders  of  Common Stock of record to be entitled to such dividend,
distribution,  subdivision  or  combination  are  to  be  determined,  or

                    (2)     the  date  on  which  such  reclassification,
consolidation,  merger,  or Liquidation is expected to become effective, and the
date  as of which it is expected that holders of Common Stock of record shall be
entitled  to  exchange  their  shares  of  Common  Stock for securities or other
property  deliverable  upon  such  reclassification,  consolidation,  merger, or
Liquidation.

          l.     Certificate  as  to  Adjustments.  Upon  the occurrence of each
                 --------------------------------
adjustment  or  readjustment  pursuant  to  this  Section  4, the Company at its
expense  shall  promptly  compute  such adjustment or readjustment in accordance
with  the  terms  hereof and furnish to each holder of Class D Preferred Stock a
certificate  setting forth such adjustment or readjustment and showing in detail
the  facts  upon  which  such  adjustment or readjustment is based.  The Company
shall,  upon  the written request at any time of any holder of Class D Preferred
Stock  furnish  or  cause  to  be furnished to such holder a similar certificate
setting  forth (i) such adjustments and readjustments; (ii) the Conversion Price
then  in  effect; and (iii) the number of shares of Common Stock and the amount,
if  any,  of  other property which then would be received upon the conversion of
Class  D  Preferred  Stock.

          m.     Stock  to  be  Reserved.  The Company will at all times reserve
                 -----------------------
and keep available out of its authorized Common Stock, solely for the purpose of
issuance upon the conversion of Class D Preferred Stock as herein provided, such
number  of  shares of Common Stock as shall then be issuable upon the conversion
of  all  outstanding  shares  of Class D Preferred Stock.  The Company covenants
that  all  shares  of  Common  Stock  which shall be so issued shall be duly and
validly  issued  and fully-paid and nonassessable and free from all taxes, liens
and  charges  with  respect  to  the  issue  thereof,  and, without limiting the
generality  of  the  foregoing,  the Company covenants that it will from time to
time  take  all such action as may be requisite to assure that the par value per
share  of  the Common Stock is at all times equal to or less than the Conversion
Price  in  effect  at the time.  The Company will take all such action as may be
necessary  to  assure  that  all  such  shares  of Common Stock may be so issued
without  violation of any applicable law or regulation, or of any requirement of
any  national  securities  exchange or market upon which the Common Stock may be
listed.  The Company will not take any action which results in any adjustment of
the  Conversion  Price  if the total number of shares of Common Stock issued and
issuable  after such action upon conversion of the Class D Preferred Stock would
exceed  the  total  number  of  shares  of Common Stock then authorized by these
Articles  of  Incorporation,  as  amended.


                                       14
<PAGE>
          n.     Issue  Tax.  The  issuance of certificates for shares of Common
                 ----------
Stock  upon  conversion  of  the  Class D Preferred Stock, shall be made without
charge  to the holders thereof for any issuance tax in respect thereof, provided
that  the  Company  shall not be required to pay any tax which may be payable in
respect of any transfer involved in the issuance and delivery of any certificate
in  a name other than that of the holder of the Class D Preferred Stock which is
being  converted.

     Section  5.     Mandatory  Conversion.
                     ---------------------

          a.     The  Company  may  require  the  conversion  of  all  of  the
outstanding Class D Preferred Stock (i) in conjunction with a Qualified Offering
(as  defined)  or (ii) at any time after the first year anniversary of the First
Issue  Date  if:  (1) the Common Stock shall have been listed for trading on the
New York Stock Exchange, the Nasdaq National Market System or the American Stock
Exchange  (each,  an "Exchange"); (2) the Common Stock shall have traded on such
Exchange  for  a  period  of at least 20 consecutive trading days at a price per
share of at least $22.37 (subject to appropriate adjustment for Recapitalization
Events);  and  (3)  the  average daily trading volume of the Common Stock during
such  20  consecutive trading day period shall be at least $1,000,000; provided,
                                                                       --------
that,  the  shares of Common Stock issuable upon such conversion shall have been
 ---
Registered (as defined) and listed on each securities exchange, over-the-counter
market  or  on  the Nasdaq National Market on which similar securities issued by
the  Company  are  then  listed.  "Registered"  shall  refer  to  a registration
effected  by  preparing  and  filing with the Securities and Exchange Commission
(the  "Commission")  a  registration statement in compliance with the Securities
Act  of  1933,  as amended, and the declaration or ordering by the Commission of
the  effectiveness  of  such  registration  statement.  A  mandatory  conversion
pursuant  to  a  Qualified  Offering  shall  only be effected at the time of and
subject to the closing of the Qualified Offering and upon written notice of such
mandatory  conversion  delivered  to  all  holders of Class D Preferred Stock at
least  seven  (7) days prior to such closing.  The Company shall deliver written
notice  of  a mandatory conversion pursuant to clause (ii) of this paragraph (a)
to  all holders of Class D Preferred Stock at least seven (7) days prior to such
conversion.  For  purposes  of this paragraph (a), the term "Qualified Offering"
shall mean the sale by the Company of its Common Stock or other equity interests
in  a firm commitment underwritten public offering at a purchase price per share
in  excess  of  $17.90  per  share  (subject  to  appropriate  adjustment  for
Recapitalization  Events)  yielding  net  aggregate  proceeds  to the Company in
excess  of  $30,000,000.

          b.     On  the  date  fixed for conversion, all rights with respect to
the  Class D Preferred Stock so converted will terminate upon conversion.  If so
required  by  the  Company,  certificates  surrendered  for  conversion shall be
endorsed  or  accompanied  by  written instrument or instruments of transfer, in
form  satisfactory  to the Company, duly executed by the registered holder or by
his  or  its  attorney duly authorized in writing.  As soon as practicable after
the date of such conversion and the surrender of the certificate or certificates
for  Class D Preferred Stock, the Company shall cause to be issued and delivered
to  such  holder,  or on his or its written order, a certificate or certificates


                                       15
<PAGE>
for  the  number  of  full shares of Common Stock issuable on such conversion in
accordance  with  the  provisions hereof and cash as provided in Section 4(c) in
respect  of any fraction of a share of Common Stock otherwise issuable upon such
conversion.

          c.     All  certificates  evidencing shares of Class D Preferred Stock
which  are  required  to  be  surrendered  for conversion in accordance with the
provisions  hereof  shall,  from  and  after  the  date such certificates are so
required  to be surrendered, be deemed to have been retired and canceled and the
shares  of  Class  D  Preferred  Stock represented thereby converted into Common
Stock  for  all purposes as of the date of conversion set forth in paragraph (a)
above, notwithstanding the failure of the holder or holders thereof to surrender
such  certificates.

     Section  6.     Mandatory  Exchange.
                     -------------------

          a.     The  Company shall be required to exchange all of the shares of
Class  D  Preferred Stock on the twelfth anniversary of the First Issue Date for
shares  of  Common  Stock;  provided, that, the shares of Common Stock so issued
                            --------  ----
shall  have  been  Registered  and  listed  on  each  securities  exchange,
over-the-counter  market  or  on  the  Nasdaq  National  Market on which similar
securities  issued  by  the  Company  are  then  listed.

          b.     The  exchange  price  shall be paid by the Company in shares of
Common  Stock  and  shall  be  in  an  amount equal to the Liquidation Price, as
defined in Section 2 (a) of this Certificate (the "Exchange Price").  The number
of  shares  of Common Stock to be issued shall be determined by dividing (i) the
Exchange  Price  by (ii) the average trading price per share of Common Stock for
the  20  consecutive  trading  days  immediately  prior  to  the  date fixed for
redemption  discounted  by  five  percent  (5%).

          c.     The  Company  shall  provide  each  holder of Class D Preferred
Stock  with a written notice of exchange (addressed to the holder at its address
as  it  appears  on  the  stock transfer books of the Company), not earlier than
sixty  (60)  nor later than twenty (20) days before the date fixed for exchange.
The  notice  of  exchange shall specify (i) the class of shares to be exchanged;
(ii)  the  date fixed for exchange; (iii) the Exchange Price; and (iv) the place
the  holders of Class D Preferred Stock may obtain payment of the Exchange Price
upon  surrender  of their certificates.  If shares of Common Stock are available
on  the  date fixed for exchange, then whether or not shares are surrendered for
payment of the Exchange Price, the shares shall no longer be outstanding and the
holders  thereof  shall  cease to be shareholders of the Company with respect to
the  shares  exchanged  on  and  after  the date fixed for exchange and shall be
entitled  to  receive  the Exchange Price without interest upon the surrender of
the  share  certificate.

     Section  7.     Preemptive  Rights.
                     ------------------

          a.     Each holder of the Class D Preferred Stock shall be entitled to
a  preemptive right to purchase its pro rata share of all or any part of any New
                                    --- ----
Securities  (as  defined)  which  the  Company  may, from time to time, sell and
issue.  Such  holder's pro rata share, for purposes of this preemptive right, is
                       --- ----
the  ratio that the number of whole shares of Common Stock into which the shares
of Class D Preferred Stock held by such holder (including any Additional Shares)
are  convertible  plus  the  number  of  shares of Common Stock then held by the
holder  as  a  result  of the conversion of Class D Preferred Stock bears to the
total  number of shares of Common Stock of the Company on a fully-diluted basis.


                                       16
<PAGE>
          b.     Except  as  set  forth  in  the next sentence, "New Securities"
shall  mean  any shares of capital stock of the Company, including Common Stock,
whether  now authorized or not, and rights, options or warrants to purchase said
shares  of capital stock, and securities of any type whatsoever that are, or may
become,  convertible  into  said  shares  of capital stock.  Notwithstanding the
foregoing,  "New  Securities"  does  not  include  (i) securities offered to the
public  generally pursuant to a registration statement filed with the Commission
and  declared  effective  under  the  Securities  Act, (ii) securities issued in
connection  with  the  acquisition  of  another entity by the Company by merger,
purchase  of  substantially  all  of  the assets or other reorganization or in a
transaction  governed  by  Rule  145  under  the  Exchange  Act,  (iii)  options
exercisable  for  Common  Stock  issued  to  employees,  officers,  directors or
consultants  of  the  Company  outstanding as of the First Issue Date or options
issued  to employees, officers, directors or consultants of the Company pursuant
to  the  Employment  Plan,  the  Executive  Plan or the Director Plan or a stock
option  plan  adopted  by the Board of Directors and approved by a Supermajority
the  holders  of Class D Preferred Stock after the First Issue Date, (iv) shares
of Common Stock issued on conversion of outstanding Class D Preferred Stock; (v)
shares of Common Stock issued upon exercise of rights, convertible securities or
warrants  (A) outstanding as of the First Issue Date or (B) issued in connection
with  the  sale  of  Class  D  Preferred  Stock  under  the  Securities Purchase
Agreement,  (vi)  stock  issued  pursuant to any rights or agreements, including
without limitation convertible securities, options and warrants, provided, that,
                                                                 --------  ----
the  preemptive rights established by this Section 7 shall apply with respect to
the  initial  sale  or  grant  by  the Company of interests in its capital stock
pursuant to such rights or agreements, (vii) stock issued in connection with any
stock split, stock dividend or recapitalization by the Company, or (viii) shares
of  Common  Stock issued upon exercise of the warrants issued in connection with
the  issuance  of  the  Company's  Class  G  Preferred  Stock.

          c.     In  the  event the Company proposes to undertake an issuance of
New Securities, it shall give the holders of the Class D Preferred Stock written
notice  of  its  intention, describing the type of New Securities, and the price
and  terms  upon  which  the Company proposes to issue the same.  Each holder of
Class D Preferred Stock shall have ten (10) days from the date of receipt of any
such notice to agree to purchase up to its respective pro rata share of such New
                                                      --- ----
Securities  for  the  price and upon the terms specified in the notice by giving
written notice to the Company and stating therein the quantity of New Securities
to  be  purchased.

          d.     In  the  event a holder fails to exercise such preemptive right
within  said  forty-day  period  (each such holder a "Non-Electing Holder"), the
Company  shall  give  the  holders that have elected to exercise such preemptive
right  within  said  forty-day  period  (each  such holder an "Electing Holder")
written  notice of each Non-Electing Holder's failure to exercise its preemptive
right to purchase its pro rata share of the New Securities (such securities, the
                      --- ----
"Additional  New  Securities").  Each  Electing  Holder shall have ten (10) days
from  the  date of receipt of any such notice to elect to purchase up to its pro
                                                                             ---
rata  share  of  the  Additional  New Securities by giving written notice to the
 ---
Company and stating therein the quantity of such New Securities to be purchased.


                                       17
<PAGE>
          e.     In  the  event  any  Electing  Holder  fails  to  exercise  its
preemptive  right pursuant to paragraph (d) above within said thirty-day period,
the  Company  shall  have  ninety  (90) days thereafter to sell or enter into an
agreement  (pursuant  to  which  the  sale  of Additional New Securities covered
thereby shall be closed, if at all, within sixty (60) days from the date of said
agreement)  to sell the Additional New Securities not elected to be purchased by
Electing  Holders  at  the  price  and  upon  the terms no more favorable to the
purchasers  of  such  securities  than  specified in the Company notice.  In the
event  the Company has not sold the Additional New Securities or entered into an
agreement  to  sell  the Additional New Securities within said ninety-day period
(or  sold  and issued Additional New Securities in accordance with the foregoing
within  sixty  (60) days from the date of said agreement), the Company shall not
thereafter  issue  or  sell any of such Additional New Securities, without first
offering  such  securities  in  the  manner  provided  above.

          f.     In  the  event  no holders exercise their respective preemptive
right pursuant to paragraph (c) above within said thirty-day period, the Company
shall  have  ninety  (90)  days  thereafter  to  sell or enter into an agreement
(pursuant  to  which the sale of New Securities covered thereby shall be closed,
if  at  all, within sixty (60) days from the date of said agreement) to sell the
New  Securities  not elected to be purchased by holders of the Class D Preferred
Stock  at  the  price  and upon the terms no more favorable to the purchasers of
such  securities  than  specified  in  the  Company's  notice.  In the event the
Company has not sold the New Securities or entered into an agreement to sell the
New  Securities within said ninety-day period (or sold and issued New Securities
in  accordance  with  the foregoing within sixty (60) days from the date of said
agreement),  the  Company  shall  not  thereafter  issue or sell any of such New
Securities, without first offering such securities in the manner provided above.

     Section  8.     Events  of  Noncompliance.
                     -------------------------

          a.     Definition.  An  Event of Noncompliance shall have occurred if:
                 ----------

               i.     the  Company fails to pay on any Dividend Payment Date the
full amount of dividends then accrued on the Class D Preferred Stock, whether or
not  such payments are legally permissible or are prohibited by any agreement to
which  the  Company  is  subject;

               ii.     the Company fails to exchange the Class D Preferred Stock
as  required hereunder, whether or not such redemption is legally permissible or
is  prohibited  by  any  agreement  to  which  the  Company  is  subject;

               iii.     subject to subparagraph (iv) below, the Company breaches
any  provision of that certain Registration Rights Agreement dated as of June 2,
2000,  by  and  among  the  Company,  Sandler Capital Partners IV, L.P., Sandler
Capital  Partners  IV  FTE,  L.P.,  CPP  LLC  and Oger Pensat Holdings Ltd. (the
"Registration Rights Agreement") and fails to cure such breach within 45 days of
notice  thereof  (in  which  case, the Event of Noncompliance shall be deemed to
have  occurred  on  the  original  date  of  such  breach);  or


                                       18
<PAGE>
               iv.     the  Company  breaches Section 2.1(a) of the Registration
Rights  Agreement.

          a.          Consequences  of  Events  of  Noncompliance.
                      -------------------------------------------

               i.     If  an  Event  of  Noncompliance  has  occurred,  (1)  the
dividend  rate on the Class D Preferred Stock set forth in Section 1(a) shall be
deemed  to increase immediately by an increment of twelve (12) percentage points
and (2) all dividends on the Class D Preferred Stock thereafter shall be paid by
the issuance of Additional Shares as set forth in Section 1(e).  Any increase of
the  dividend  rate  resulting  from  the  operation  of this subparagraph shall
terminate  as  of  the  close  of  business  on  the  date  on which no Event of
Noncompliance  exists.

               ii.     If  any  Event  of Noncompliance of the type described in
subparagraph  8(a)(i)  has  occurred, for each such occurrence of the failure to
pay  on  any  Dividend Payment Date the full amount of dividends then accrued on
the  Class  D Preferred, whether or not such payments are legally permissible or
are prohibited by any agreement to which the Company is subject, the  Conversion
Price  shall  be  reduced immediately by fifty percent (50%) from the Conversion
Price  in  effect  immediately  prior to such adjustment.  In no event shall any
Conversion  Price  adjustment  be  rescinded.

               iii.     If  any  Event  of  Noncompliance exists, each holder of
Class  D  Preferred  Stock shall also have any other rights which such holder is
entitled  to  under  the  Securities Purchase Agreement or any other contract or
agreement  with  such  holder at any time and any other rights which such holder
may  have  pursuant  to  applicable  law."

                  [Remainder of Page Intentionally Left Blank]


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<PAGE>
     IN  WITNESS  WHEREOF, this amended and restated Statement of Resolution has
been  signed  by  the  President  of the Company this ___ day of December, 2000.
TELSCAPE  INTERNATIONAL,  INC.



                                         By:___________________________________

                                         Name:_________________________________

                                         Title:________________________________


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