EXHIBIT 3.1
                          CERTIFICATE OF INCORPORATION
                                       OF
                                   TEXACO INC.
                   (as amended to and including August 4, 1999)

      A Restated Certificate of  Incorporation  was duly adopted by the Board of
Directors  of Texaco  Inc.  on April 27,  1990,  pursuant  to Section 245 of the
General Corporation Law of the State of Delaware and was amended on December 22,
1992,  November 9, 1994,  September 10, 1997,  March 2, 1999, April 27, 1999 and
August 4, 1999. This document only restates and integrates the provisions of the
Company's  Restated  Certificate  of  Incorporation  as  heretofore  amended  or
supplemented.

      The  Company  was  incorporated  under the laws of  Delaware on August 26,
1926, as The Texas Corporation.

                                       I.

      The name of this Company is TEXACO INC.

                                       II.

      Its principal  office in the State of Delaware is located at 32 Loockerman
Square,  Suite L-100, in the City of Dover,  County of Kent, and the name of its
resident agent is The Prentice-Hall  Corporation System,  Inc., whose address is
32 Loockerman Square, Suite L-100, Dover, Delaware.

                                      III.

      The objects or purposes  for which the Company is formed and the nature of
the  business  to be  carried  on,  any one or all of which it may pursue in the
United States of America and the states, districts,  territories and possessions
thereof and in foreign countries, are as follows:

      A. to  engage  in and  carry on the  petroleum  business  and the  various
branches thereof, including the extraction, production, storage, transportation,
purchase  and  sale of oil  and  gas,  natural  gas  liquids,  shale  and  other
hydrocarbon  substances  and  their  products  and  by-products,  and  refining,
treating,  applying,  compounding,  processing and otherwise  preparing them for
market;

      B. to engage in and carry on any other business,  without limit as to kind
and whether or not related  to,  similar to or  different  from,  the  petroleum
business, including but not limited to, the businesses of mining, manufacturing,
processing, storage, construction, service, transportation and merchandising;

      C. to acquire,  own, hold, enjoy, lease, deal in, operate,  dispose of and
convey  real and  personal  property of every kind and  description,  rights and
interests  therein,  and the  business,  property,  assets  and good will of any
person, partnership, association, firm, corporation or other entity;

      D. to acquire,  own, hold, enjoy, deal in and sell,  transfer or otherwise
dispose  of  stock,  bonds,  notes and other  securities,  as well as  accounts,
contracts and evidences of indebtedness of any person, partnership, association,
firm,  corporation or other entity,  in whatsoever  business or activity engaged
and  whether  private  or public in  character,  and to  exercise  all rights in
respect thereto;

                                       1


<PAGE>

     E. to make  secured and  unsecured  loans,  with or without  interest,  to
assume or  guarantee  the stock,  bonds,  and  obligations  of, or  otherwise to
assist, any person, partnership, association, firm, corporation or other entity,
in  whatsoever  business  or activity  engaged and whether  public or private in
character,  when so doing, in the opinion of the Board of Directors,  would tend
to promote the business of this Company;

      F. to  acquire,  own,  hold,  enjoy,  grant,  deal in,  transfer,  sell or
otherwise  dispose  of  intangible  property  of  every  kind  and  description,
including, without limitation,  patents, patent rights, trademarks, trade names,
copyrights, licenses, formulae and chooses in action of any kind;

      G. to do all and everything useful in or incidental to the  accomplishment
of the objects and purposes  herein  stated,  as principal,  agent,  contractor,
trustee,  or otherwise,  either alone or in association with others, to the same
extent and as fully as could natural persons.

      No  enumeration  of specific  objects,  purposes or powers,  or particular
description  of business in this  article  shall be held to limit or restrict in
any  manner  those  enumerations  or  descriptions  which are  general  in their
character,  and the objects,  powers and descriptions of one section shall in no
wise be limited or restricted by reference to or inference from the terms of any
other section.

                                       IV.

      The total number of shares of all classes of stock which the Company shall
have authority to issue is 880,000,000  shares,  consisting of 30,000,000 shares
of  Preferred  Stock of the par value of $1.00  each and  850,000,000  shares of
Common Stock of the par value of $3.125 each.

      The  designations  and  the  powers,   preferences  and  rights,  and  the
qualifications,  limitations  or  restrictions  of the  Preferred  Stock and the
Common Stock are as follows:

      (A) The  Preferred  Stock may be  issued  from time to time in one or more
series.  Subject  to the  limitations  set  forth  herein  and  any  limitations
prescribed  by law, the Board of Directors  is  expressly  authorized,  prior to
issuance of any series of Preferred  Stock,  to fix by resolution or resolutions
providing  for the issue of any  series the  number of shares  included  in such
series and the  designation,  relative powers,  preferences and rights,  and the
qualifications,  limitations  or  restrictions  of such series.  Pursuant to the
foregoing  general  authority  vested  in the  Board  of  Directors,  but not in
limitation of the powers conferred on the Board of Directors  thereby and by the
General  Corporation  Law of the State of  Delaware,  the Board of  Directors is
expressly  authorized  to  determine  with  respect to each series of  Preferred
Stock:

            1. the  designation or designations of such series and the number of
      shares  (which  number from time to time may be  decreased by the Board of
      Directors,  but not below the number of such  shares of such  series  then
      outstanding,  or may  be  increased  by  the  Board  of  Directors  unless
      otherwise provided in creating such series) constituting such series;

            2. the rate or amount and times at which,  and the  preferences  and
      conditions  under  which,  dividends  shall be  payable  on shares of such
      series, the status of such dividends as cumulative or non-cumulative,  the
      date or dates from which dividends, if cumulative,  shall accumulate,  and
      the status of such as participating or non-participating after the payment
      of dividends as to which such shares are entitled to any preference;

                                       2
<PAGE>

            3. the rights and  preferences,  if any, of the holders of shares of
      such series upon the liquidation, dissolution or winding up of the affairs
      of, or upon any  distribution of the assets of, the Company,  which amount
      may vary depending upon whether such  liquidation,  dissolution or winding
      up is voluntary or  involuntary  and, if voluntary,  may vary at different
      dates,  and the status of the shares of such  series as  participating  or
      non-participating   after  the   satisfaction   of  any  such  rights  and
      preferences;

            4. the full or limited  voting  rights,  if any, to be provided  for
      shares of such series, in addition to the voting rights provided by law;

            5. the times,  terms and  conditions,  if any,  upon which shares of
      such  series  shall be subject  to  redemption,  including  the amount the
      holders  of  shares of such  series  shall be  entitled  to  receive  upon
      redemption  (which  amount  may  vary  under  different  conditions  or at
      different redemption dates) and the amount,  terms,  conditions and manner
      of operation of any  purchase,  retirement  or sinking fund to be provided
      for the shares of such series;

            6. the  rights,  if any,  of  holders  of shares  of such  series to
      convert such shares into,  or to exchange  such shares for,  shares of any
      other  class or  classes  or of any other  series of the same  class,  the
      prices or rates of conversion or exchange,  and adjustments  thereto,  and
      any other terms and conditions applicable to such conversion or exchange;

            7.  the  limitations,  if  any,  applicable  while  such  series  is
      outstanding on the payment of dividends or making of distributions  on, or
      the  acquisition  or  redemption  of,  Common  Stock or any other class of
      shares ranking junior, either as to dividends or upon liquidation,  to the
      shares of such series;

            8. the  conditions  or  restrictions,  if any, upon the issue of any
      additional shares (including additional shares of such series or any other
      series or of any other  class)  ranking  on a parity  with or prior to the
      shares of such series either as to dividends or upon liquidation; and

            9.  any  other  relative  powers,   preferences  and  participating,
      optional or other special rights, and the  qualifications,  limitations or
      restrictions thereof, of shares of such series;

in each case, so far as not inconsistent with the provisions of this Certificate
of Incorporation or the General Corporation Law of the State of Delaware as then
in effect.  All shares of Preferred  Stock shall be identical  and of equal rank
except in respect to the particulars that may be fixed by the Board of Directors
as provided  above,  and all shares of each series of  Preferred  Stock shall be
identical  and of equal  rank  except  as to the  times  from  which  cumulative
dividends, if any, thereon shall be cumulative.

      B. Pursuant to the authority  conferred upon the Board of Directors by the
Restated  Certificate of  Incorporation,  the Board of Directors has created the
following  series  of  Preferred  Stock,   with  the  following  voting  powers,
preferences and relative,  participating,  optional or other special rights, and
the following qualifications, limitations or restrictions.

                                       3

<PAGE>

                  Series D Junior Participating Preferred Stock

      SECTION 1. Designation and Amount.

      The  shares  of such  series  shall  be  designated  as  "Series  D Junior
Participating Preferred Stock" and the number of shares constituting such series
shall be 3,000,000.

      SECTION 2. Dividends and Distributions.

      (A) Subject to the prior and superior  rights of the holders of any shares
of any series of  Preferred  Stock  ranking  prior and superior to the shares of
Series D Junior  Participating  Preferred  Stock with respect to dividends,  the
holders  of shares of Series D Junior  Participating  Preferred  Stock  shall be
entitled to receive,  when,  as and if declared by the Board of Directors out of
funds legally available for the purpose,  quarterly dividends payable in cash on
the 15th day of March, June, September and December in each year (each such date
being referred to herein as a "Quarterly Dividend Payment Date"),  commencing on
the first Quarterly Dividend Payment Date after the first issuance of a share or
fraction  of a share of Series D Junior  Participating  Preferred  Stock,  in an
amount per share (rounded to the nearest cent) equal to the greater of (a) $5.00
or (b) subject to the provision for adjustment  hereinafter set forth, 100 times
the  aggregate  per  share  amount  of all cash  dividends,  and 100  times  the
aggregate per share amount (payable in kind) of all non-cash  dividends or other
distributions other than a dividend payable in shares of common stock, par value
$6.25 per share,  of the Company (the "Common  Stock") or a  subdivision  of the
outstanding shares of Common Stock (by reclassification or otherwise),  declared
on the Common Stock, since the immediately  preceding Quarterly Dividend Payment
Date, or, with respect to the first Quarterly  Dividend  Payment Date, since the
first  issuance  of any  share  or  fraction  of a  share  of  Series  D  Junior
Participating  Preferred Stock. In the event the Company shall at any time after
March 16, 1989 (the  "Rights  Declaration  Date") (i)  declare  any  dividend on
Common Stock payable in shares of Common Stock,  (ii) subdivide the  outstanding
Common  Stock,  or (iii)  combine the  outstanding  Common  Stock into a smaller
number of shares,  then in each such case the amount to which  holders of shares
of Series D Junior Participating Preferred Stock were entitled immediately prior
to such event under clause (b) of the  preceding  sentence  shall be adjusted by
multiplying  such amount by a fraction  the  numerator of which is the number of
shares  of  Common  Stock  outstanding  immediately  after  such  event  and the
denominator  of  which is the  number  of  shares  of  Common  Stock  that  were
outstanding immediately prior to such event.

      (B) The Company shall declare a dividend or  distribution  on the Series D
Junior  Participating  Preferred  Stock  as  provided  in  paragraph  (A)  above
immediately  after it declares a dividend or  distribution  on the Common  Stock
(other than a dividend payable in shares of Common Stock); provided that, in the
event no dividend or  distribution  shall have been declared on the Common Stock
during the period  between  any  Quarterly  Dividend  Payment  Date and the next
subsequent Quarterly Dividend Payment Date, a dividend of $5.00 per share on the
Series D Junior  Participating  Preferred Stock shall nevertheless be payable on
such subsequent Quarterly Dividend Payment Date.

      (C)  Dividends  shall  begin to accrue and be  cumulative  on  outstanding
shares of  Series D Junior  Participating  Preferred  Stock  from the  Quarterly
Dividend  Payment Date next preceding the date of issue of such shares of Series
D Junior Participating  Preferred Stock, unless the date of issue of such shares
is prior to the record date for the first  Quarterly  Dividend  Payment Date, in
which case dividends on such shares shall begin to accrue from the date of issue
of such shares, or unless the date of issue is a Quarterly Dividend Payment Date
or is a date after the record date for the determination of holders of shares of
Series D Junior  Participating  Preferred  Stock entitled to receive a quarterly
dividend and


                                       4
<PAGE>


before such  Quarterly  Dividend  Payment  Date,  in either of which events such
dividends shall begin to accrue and be cumulative  from such Quarterly  Dividend
Payment Date.  Accrued but unpaid  dividends shall not bear interest.  Dividends
paid on the shares of Series D Junior Participating Preferred Stock in an amount
less than the total amount of such  dividends at the time accrued and payable on
such shares shall be allocated pro rata on a share-by-share basis among all such
shares at the time outstanding. The Board of Directors may fix a record date for
the  determination  of  holders  of  shares  of  Series D  Junior  Participating
Preferred  Stock  entitled  to receive  payment of a  dividend  or  distribution
declared  thereon,  which record date shall be no more than 45 days prior to the
date fixed for the payment thereof.

      SECTION 3. Voting Rights.

      The  holders of shares of Series D Junior  Participating  Preferred  Stock
shall have the following voting rights:

      (A) Subject to the provision for adjustment  hereinafter  set forth,  each
share of Series D Junior Participating  Preferred Stock shall entitle the holder
thereof to 100 votes on all matters  submitted to a vote of the  stockholders of
the  Company.  In the  event the  Company  shall at any time  after  the  Rights
Declaration  Date (i) declare any dividend on Common Stock  payable in shares of
Common Stock, (ii) subdivide the outstanding  Common Stock, or (iii) combine the
outstanding Common Stock into a smaller number of shares, then in each such case
the  number  of votes per  share to which  holders  of shares of Series D Junior
Participating  Preferred  Stock were  entitled  immediately  prior to such event
shall be adjusted by  multiplying  such number by a fraction  the  numerator  of
which is the number of shares of Common Stock outstanding immediately after such
event and the  denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.

      (B) Except as otherwise  provided  herein or by law, the holders of shares
of Series D Junior  Participating  Preferred  Stock and the holders of shares of
Common Stock shall vote together as one class on all matters submitted to a vote
of stockholders of the Company.

      (C) If at the time of any annual meeting of stockholders  for the election
of  directors,  the  equivalent  of  six  quarterly  dividends  (whether  or not
consecutive)  payable on any share or shares of preferred  stock are in default,
the number of directors constituting the Board of Directors of the Company shall
be increased by two. The holders of record of the Series D Junior  Participating
Preferred Stock,  voting separately as a class with the holders of shares of any
one or more other series of preferred  stock upon which like voting  rights have
been conferred,  shall be entitled at said meeting of stockholders  (and at each
subsequent annual meeting of stockholders), unless all dividends in arrears have
been paid or declared and set apart for payment prior  thereto,  to vote for the
election of two  directors  of the  Company,  the holders of any Series D Junior
Participating  Preferred  Stock  being  entitled  to cast 100 votes per share of
Series D Junior  Participating  Preferred Stock, with the remaining directors of
the Company to be elected by the holders of shares of any other class or classes
or series of stock entitled to vote  therefor.  Until the default in payments of
all  dividends  which  permitted the election of said  directors  shall cease to
exist,  any  director  who  shall  have  been so  elected  pursuant  to the next
preceding  sentence  may be removed at any time,  either with or without  cause,
only by the  affirmative  vote of the holders of the shares at the time entitled
to cast a majority of the votes entitled to be cast for the election of any such
director at a special  meeting of such holders called for that purpose,  and any
vacancy thereby  created may be filled by the vote of such holders.  If and when
such  default  shall  cease  to  exist,  the  holders  of the  Series  D  Junior
Participating  Preferred  Stock  and the  holders  of  shares of any one or more
series of  preferred  stock upon which like voting  rights  have been  conferred
shall be divested of the foregoing  special voting rights,  subject to revesting
in the event of each and every subsequent like default in payments of dividends.
Upon the termination of the foregoing special


                                       5
<PAGE>


voting  rights,  the terms of office of all  persons  who may have been  elected
directors pursuant to said special voting rights shall forthwith terminate,  and
the number of directors  constituting the Board of Directors shall be reduced by
two.

      (D) Except as set forth herein,  holders of Series D Junior  Participating
Preferred  Stock shall have no special voting rights and their consent shall not
be  required  (except to the extent they are  entitled  to vote with  holders of
Common Stock as set forth herein) for taking any corporate action.

      SECTION 4. Certain Restrictions.

      (A) In the event  that full  cumulative  dividends  on the Series D Junior
Participating  Preferred  Stock have not been declared and paid or set apart for
payment when due, the Company  shall not declare or pay or set apart for payment
any dividends or make any other distributions on, or make any payment on account
of the purchase,  redemption or other  retirement of any other class of stock or
series thereof of the Company ranking, as to dividends or as to distributions in
the event of a liquidation,  dissolution or winding-up of the Company, junior to
the  Series  D  Junior  Participating  Preferred  Stock  until  full  cumulative
dividends on the Series D Junior  Participating  Preferred Stock shall have been
paid or  declared  and set  apart  for  payment;  provided,  however,  that  the
foregoing  shall not apply to (i) any dividend  payable  solely in any shares of
any stock  ranking,  as to dividends and as to  distributions  in the event of a
liquidation,  dissolution  or winding-up of the Company,  junior to the Series D
Junior  Participating  Preferred  Stock or (ii) the acquisition of shares of any
stock  ranking,  as to  dividends  or as to  distributions  in  the  event  of a
liquidation,  dissolution  or winding-up of the Company,  junior to the Series D
Junior Participating  Preferred Stock in exchange solely for shares of any other
stock  ranking,  as to  dividends  and as to  distributions  in the  event  of a
liquidation,  dissolution  or winding-up of the Company,  junior to the Series D
Junior Participating Preferred Stock.

      (B) The Company shall not permit any subsidiary of the Company to purchase
or otherwise acquire for consideration any shares of stock of the Company unless
the Company could,  under paragraph (A) of this Section 4, purchase or otherwise
acquire such shares at such time and in such manner.

      SECTION 5. Reacquired Shares.

      Any shares of Series D Junior  Participating  Preferred Stock purchased or
otherwise  acquired by the Company in any manner whatsoever shall be retired and
canceled  promptly  after the  acquisition  thereof.  All such shares shall upon
their cancellation  become authorized but unissued shares of Preferred Stock and
may be  reissued  as part of a new  series of  Preferred  Stock to be created by
resolution or resolutions  of the Board of Directors,  subject to the conditions
and restrictions on issuance set forth herein.

      SECTION 6. Liquidation, Dissolution or Winding Up.

      (A) Upon any liquidation (voluntary or otherwise),  dissolution or winding
up of the  Company,  no  distribution  shall be made to the holders of shares of
stock ranking junior (either as to dividends or upon liquidation, dissolution or
winding up) to the Series D Junior  Participating  Preferred Stock unless, prior
thereto, the holders of shares of Series D Junior Participating  Preferred Stock
shall have received  $100 per share,  plus an amount equal to accrued and unpaid
dividends and  distributions  thereon,  whether or not declared,  to the date of
such payment (the "Series D Liquidation  Preference").  Following the payment of
the  full  amount  of  the  Series  D  Liquidation  Preference,   no  additional
distributions  shall  be made to the  holders  of  shares  of  Series  D  Junior
Participating  Preferred Stock unless,  prior thereto,  the


                                       6
<PAGE>


holders of shares of Common  Stock shall have  received an amount per share (the
"Common Adjustment") equal to the quotient obtained by dividing (i) the Series D
Liquidation  Preference by (ii) 100 (as  appropriately  adjusted as set forth in
subparagraph  (C) below to reflect such events as stock splits,  stock dividends
and  recapitalizations  with respect to the Common Stock) (such number in clause
(ii) immediately above being referred to as the "Adjustment Number").  Following
the payment of the full amount of the Series D  Liquidation  Preference  and the
Common  Adjustment  in  respect  of all  outstanding  shares  of Series D Junior
Participating Preferred Stock and Common Stock, respectively,  holders of Series
D Junior  Participating  Preferred  Stock and holders of shares of Common  Stock
shall receive their ratable and  proportionate  share of the remaining assets to
be distributed in the ratio of the Adjustment  Number to one (1) with respect to
such Preferred Stock and Common Stock, on a per share basis, respectively.

      (B) In the event,  however, that there are not sufficient assets available
to  permit  payment  in full of the  Series  D  Liquidation  Preference  and the
liquidation  preferences of all other series of Preferred  Stock,  if any, which
rank on a parity with the Series D Junior  Participating  Preferred Stock,  then
such remaining assets shall be distributed ratably to the holders of such parity
shares in proportion to their respective liquidation preferences.  In the event,
however,  that there are not  sufficient  assets  available to permit payment in
full of the Common  Adjustment,  then such remaining assets shall be distributed
ratably to the holders of Common Stock.

      (C)  In the  event  the  Company  shall  at  any  time  after  the  Rights
Declaration  Date (i) declare any dividend on Common Stock  payable in shares of
Common Stock, (ii) subdivide the outstanding  Common Stock, or (iii) combine the
outstanding Common Stock into a smaller number of shares, then in each such case
the  Adjustment  Number  in  effect  immediately  prior to such  event  shall be
adjusted by multiplying  such  Adjustment  Number by a fraction the numerator of
which is the number of shares of Common Stock outstanding immediately after such
event and the  denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.


      SECTION 7. Consolidation, Merger, etc.

      In  case  the  Company  shall  enter  into  any   consolidation,   merger,
combination  or other  transaction  in which  the  shares  of  Common  Stock are
exchanged for or changed into other stock or  securities,  cash and/or any other
property,  then in any such case the  shares  of  Series D Junior  Participating
Preferred  Stock shall at the same time be similarly  exchanged or changed in an
amount per share (subject to the provision for adjustment hereinafter set forth)
equal to 100 times the aggregate  amount of stock,  securities,  cash and/or any
other  property  (payable in kind),  as the case may be, into which or for which
each share of Common  Stock is changed or  exchanged.  In the event the  Company
shall at any time after the Rights  Declaration Date (i) declare any dividend on
Common Stock payable in shares of Common Stock,  (ii) subdivide the  outstanding
Common  Stock,  or (iii)  combine the  outstanding  Common  Stock into a smaller
number of shares,  then in each such case the amount set forth in the  preceding
sentence  with  respect to the  exchange  or change of shares of Series D Junior
Participating  Preferred Stock shall be adjusted by multiplying such amount by a
fraction  the  numerator  of which is the  number  of  shares  of  Common  Stock
outstanding  immediately  after such event and the  denominator  of which is the
number of shares of Common Stock that were outstanding immediately prior to such
event.

                                       7

<PAGE>

      SECTION 8. Redemption.

      The outstanding  shares of Series D Junior  Participating  Preferred Stock
may be redeemed at the option of the Board of Directors as a whole,  or in part,
at any time,  or from  time to time,  at a cash  price  per  share  equal to the
product of the Adjustment Number times the Average Market Value (as such term is
hereinafter defined) of the Common Stock on the date of mailing of the notice of
redemption,  plus all dividends which on the redemption date have accrued on the
shares to be redeemed and have not been paid,  or declared and a sum  sufficient
for the payment thereof set apart, without interest.  The "Average Market Value"
as of a particular  date is the average of the closing sale prices of the Common
Stock during the 10 consecutive  Trading Day period  immediately  preceding such
date on the Composite  Tape for New York Stock Exchange  Listed  Stocks,  or, if
such stock is not quoted on the Composite  Tape, on the New York Stock Exchange,
or, if such stock is not listed on such Exchange, on the principal United States
securities  exchange  registered  under the Securities  Exchange Act of 1934, as
amended,  on which such stock is listed,  or, if such stock is not listed on any
such exchange, the average of the closing sale prices with respect to a share of
Common Stock during such 10-day period, as quoted on the National Association of
Securities Dealers,  Inc. Automated Quotations System or any system then in use,
or if no such  quotations  are  available,  the fair market  value of the Common
Stock as determined  by the Board of Directors in good faith.  The term "Trading
Day" shall mean a day on which the  principal  national  securities  exchange on
which  the  Common  Stock is  listed  or  admitted  to  trading  is open for the
transaction  of  business  or, if the Common  Stock is not listed or admitted to
trading on any  national  securities  exchange,  a Monday,  Tuesday,  Wednesday,
Thursday or Friday on which  banking  institutions  in the State of New York are
not authorized or obligated by law or executive order to close.

      SECTION 9. Ranking.

      The Series D Junior Participating Preferred Stock shall rank junior to the
Company's  Series B ESOP  Convertible  Preferred Stock, and shall rank junior to
all other series of the Company's  Preferred  Stock unless the terms of any such
other series shall  provide  otherwise,  as to the payment of dividends  and the
distribution of assets.

      SECTION 10. Amendment.

      The Restated  Certificate  of  Incorporation  of the Company  shall not be
further amended in any manner which would materially alter or change the powers,
preferences  or special  rights of the Series D Junior  Participating  Preferred
Stock so as to affect them adversely without the affirmative vote of the holders
of a majority or more of the outstanding shares of Series D Junior Participating
Preferred Stock, voting separately as a class.

      SECTION 11. Fractional Shares.

      Series D Junior  Participating  Preferred Stock may be issued in fractions
of a share  which  shall  entitle the holder,  in  proportion  to such  holder's
fractional shares, to exercise voting rights, receive dividends,  participate in
distributions and to have the benefit of all other rights of holders of Series D
Junior Participating Preferred Stock.

                                       8

<PAGE>


                         Market Auction Preferred Shares

      SECTION 1. Designation; Amount and Series.

      The Preferred Stock authorized hereby consists of 1,200 shares (each share
a series)  designated as "Market Auction  Preferred  Shares" (referred to as the
"Auction  Preferred",  the  "Preferred  Stock" or the  "Remarketing  Preferred")
issuable in the following  groups of series (each group a "Series"):  300 shares
designated  "Market  Auction  Preferred  Shares,  Series G-1 through G-300" (the
"Series G Preferred  Stock"),  300 shares  designated  "Market Auction Preferred
Shares,  Series H-1 through H-300" (the "Series H Preferred Stock"),  300 shares
designated  "Market  Auction  Preferred  Shares,  Series I-1 through I-300" (the
"Series I Preferred Stock") and 300 shares designated  "Market Auction Preferred
Shares,  Series J-1 through J-300" (the "Series J Preferred  Stock").  Except as
expressly  provided  herein,  each  share of each  separate  Series  of  Auction
Preferred  shall be  identical  and equal in all aspects to every other share of
such Series, and the shares of all of the Series shall be identical and equal in
all respects.

      SECTION 2. Definitions.

      Any  references to Sections or  subsections  that are made in this part of
Article  IV(B)  shall be to Sections or  subsections  contained  in this part of
Article IV(B).  Unless the context or use indicates another or different meaning
or intent,  the following  terms shall have the following  meanings when used in
this part of Article IV(B), whether used in the singular or plural:

      "Act" means the Securities Act of 1933, as amended.

      "Additional  Payments"  means an amount  equal to the  product  of (i) the
Default Rate on the date on which such Failure to Deposit  occurred (or, if such
Failure to Deposit  relates to a failure to pay dividends  other than at the end
of a Dividend Period, the Default Rate computed using the Percentage  applicable
to the rating category below "baa3" or "BBB-" as of the Business Day immediately
preceding the Auction Date or the date of the immediately  preceding Remarketing
for such  shares),  times (ii) a fraction,  the  numerator  of which will be the
number of days during which such failure  existed and was not cured as described
in Section 3(i)(B)  (including the day such failure occurs and excluding the day
such failure is cured) and the denominator of which will be 360, times (iii) the
full amount of the  dividends  required to be paid on the Dividend  Payment Date
with respect to which such failure occurred.

      "Affiliate" means any Person controlled by, in control of, or under common
control with, the Corporation.

      "Applicable `AA' Composite  Commercial Paper Rate", on any date, means, in
the case of any Dividend Period of (1) 1 to 48 days, the interest  equivalent of
the  30-day  rate,  (2) 49 days or more but  less  than 70  days,  the  interest
equivalent  of the 60-day rate,  (3) 70 days or more but less than 85 days,  the
arithmetic  average of the interest  equivalent  of the 60-day and 90-day rates,
(4) 85 days or more but less  than 120  days,  the  interest  equivalent  of the
90-day rate, (5) 120 days or more but less than 148 days, the arithmetic average
of the interest equivalent of the 90-day and 180-day rates, (6) 148 days or more
but less than 184 days,  the interest  equivalent  of the 180-day  rate, in each
case, on commercial  paper placed on behalf of issuers whose corporate bonds are
rated  "AA" by S&P or "Aa" by  Moody's,  or the  equivalent  of such  rating  by
another rating agency, as made available on a discount basis or otherwise by the
Federal Reserve Bank of New York for the Business Day immediately preceding such

                                       9
<PAGE>


date.  In the  event  that the  Federal  Reserve  Bank of New York does not make
available  any of the  foregoing  rates,  then such rates  shall be the  30-day,
60-day,  90-day or 180-day rate or arithmetic average of such rates, as the case
may be, as quoted on a discount  basis or  otherwise,  by the  Commercial  Paper
Dealers to the Auction Agent or the applicable Remarketing Agent as of the close
of business on the  Business Day next  preceding  such date.  If any  Commercial
Paper Dealer does not quote a rate  required to determine  the  Applicable  "AA"
Composite  Commercial Paper Rate, the Applicable "AA" Composite Commercial Paper
Rate shall be determined  on the basis of the quotation or quotations  furnished
by the remaining Commercial Paper Dealer (if any) and any Substitute  Commercial
Paper Dealer or Substitute  Commercial Paper Dealers selected by the Corporation
to  provide  such rate or rates  or,  if the  Corporation  does not  select  any
Substitute  Commercial Paper Dealer or Substitute  Commercial Paper Dealers,  by
the remaining Commercial Paper Dealer (if any). For purposes of this definition,
the "interest  equivalent"  means the  equivalent  yield on a 360-day basis of a
discount-basis security to an interest-bearing security.

      "Applicable  Determining Rate" means (i) for any Dividend Period from 1 to
48 days, Standard Dividend Period or Short-Dividend  Period of 183 days or less,
the Applicable "AA" Composite Commercial Paper Rate, (ii) for any Short Dividend
Period of 184 to 364 days, the  Applicable  Treasury Bill Rate and (iii) for any
Long Dividend Period, the Applicable Treasury Note Rate.

      "Applicable  Rate" means the dividend rate payable on a share of Preferred
Stock for any Dividend Period subsequent to the Initial Dividend Period for such
share established pursuant to Section 3 below.

      "Applicable Treasury Bill Rate" for any Short Dividend Period in excess of
183 days and "Applicable  Treasury Note Rate" for any Long Dividend  Period,  on
any date,  means the interest  equivalent of the rate for direct  obligations of
the United States  Treasury  having an original  maturity  which is equal to, or
next  lower  than,  the length of such Short  Dividend  Period or Long  Dividend
Period,  as the case may be, as published weekly by the Federal Reserve Board in
"Federal Reserve Statistical Release H.15(519)-Selected  Interest Rates", or any
successor  publication  by the Federal  Reserve  Board,  within 5 Business  Days
preceding  such  date.  In the event  that the  Federal  Reserve  Board does not
publish such rate, or if such release is not available,  the Applicable Treasury
Bill Rate or Applicable  Treasury Note Rate will be the  arithmetic  mean of the
secondary market bid rates as of approximately 3:30 P.M., New York City time, on
the  Business Day next  preceding  such date of the U.S.  Government  Securities
Dealers  furnished to the Auction Agent or the applicable  Remarketing Agent for
the issue of direct  obligations of the United States Treasury,  in an aggregate
principal  amount of at least  $250,000 with a remaining  maturity  equal to, or
next  lower  than,  the length of such Short  Dividend  Period or Long  Dividend
Period,  as the case may be. If any U.S.  Government  Securities Dealer does not
quote a rate  required to determine  the  Applicable  Treasury  Bill Rate or the
Applicable  Treasury Note Rate, the Applicable  Treasury Bill Rate or Applicable
Treasury  Note  Rate  shall  be  determined  on the  basis of the  quotation  or
quotations furnished by the remaining U.S. Government Securities Dealer (if any)
or any Substitute U.S.  Government  Securities Dealer or Dealers selected by the
Corporation to provide such rate or rates or, if the Corporation does not select
any such Substitute U.S.  Government  Securities  Dealer,  by the remaining U.S.
Government  Securities  Dealer (if any);  provided  that, if the  Corporation is
unable to cause such  quotations  to be  furnished  to the Auction  Agent or the
applicable  Remarketing  Agent by such sources,  the  Corporation may cause such
rates to be furnished to the Auction Agent or the applicable  Remarketing  Agent
by such  alternative  source  as the  Corporation  in  good  faith  deems  to be
reliable.  For purposes of this definition,  the "interest equivalent" of a rate
stated on a discount  basis shall be equal to the  quotient of (A) the  discount
rate divided by (B) the difference between 1.00 and the discount rate.


                                       10
<PAGE>

      "Articles   of   Incorporation"   means  the   Restated   Certificate   of
Incorporation, as amended, of the Corporation.

      "Auction" means each periodic implementation of the Auction Procedures.

      "Auction  Agent" means The Bank of New York,  unless or until another bank
or trust company has been appointed as such by the Corporation.

      "Auction Agent Agreement" has the meaning set forth in Section 8 below.

      "Auction  Date"  means,  for any  Series of Auction  Preferred,  the first
Business Day  preceding  the first day of each  Dividend  Period for such Series
other than the Initial Dividend Period for such Series.

      "Auction  Method"  means a method  of  determining  Dividend  Periods  and
dividend  rates for the Auction  Preferred  of a Series  pursuant to the Auction
Procedures.

      "Auction  Preferred" means the Auction Preferred,  including the Converted
Remarketing Preferred, being auctioned pursuant to the Auction Procedures.

      "Auction  Procedures"  means the procedures  for  conducting  Auctions set
forth in Section 7 below.

      "Board of Directors"  means the Board of Directors of the  Corporation  or
any duly  authorized  committee  of the  Board of  Directors  acting  on  behalf
thereof.

      "Broker-Dealer" means any broker-dealer,  or other entity permitted by law
to  perform  the  functions   required  of  a  Broker-Dealer  in  these  Auction
Procedures,  that has been  selected by the  Corporation  and has entered into a
Broker-Dealer Agreement with the Auction Agent that remains effective.

      "Business  Day" means a day on which the New York Stock  Exchange  is open
for  trading  and which is not a day on which  banks in The City of New York are
authorized or obliged by law to close.

      "Certificate of Designations"  or  "Certificate"  means the Certificate of
Designations,  Preferences and Rights of Market Auction  Preferred Shares of the
Corporation dated and filed with the Delaware Secretary of State on December 22,
1992.

      "Chief  Financial  Officer" has the meaning set forth in Section  3(g)(ii)
below.

      "Code" means the Internal Revenue Code of 1986, as amended.

      "Commercial  Paper  Dealers"  means Morgan Stanley and First Boston or, in
lieu thereof, their respective affiliates or successors.

      "Converted  Auction Preferred" means shares of Auction Preferred which, by
reason of an election  by the Method  Selection  Agent of a  different  Dividend
Determination  Method,  will  become  Remarketing  Preferred  at the  end of the
then-current Dividend Period applicable thereto.

      "Converted  Remarketing  Preferred" means shares of Remarketing  Preferred
which,  by reason of an  election by the Method  Selection  Agent of a different
Dividend  Determination  Method, will become Auction Preferred at the end of the
then-current Dividend Period applicable thereto.


                                       11

<PAGE>

      "Corporation" means Texaco Inc., a Delaware corporation, or its successor.

      "Date of Original  Issue",  with respect to any share of Preferred  Stock,
means  the  date on  which  the  Corporation  originally  issued  such  share of
Preferred Stock.

      "Default Period" has the meaning set forth in Section 6(b)(i) below.

      "Default  Rate"  means  the  higher  of (A) the  Maximum  Applicable  Rate
obtained by multiplying the Applicable  Determining  Rate,  determined as of the
Business Day next preceding the date of the Failure to Deposit that, pursuant to
Section 3(i), caused the application of such Default Rate, by the Percentage for
the rating  category below "baa3" or "BBB-",  and (B) (i) if the Corporation has
failed  timely to pay  dividends,  the dividend  rate in effect for the Dividend
Period in  respect of which such  Failure  to Deposit  occurred,  or (ii) if the
Corporation has failed timely to pay the redemption price (including accumulated
and unpaid  dividends)  of shares of any Series of  Preferred  Stock  called for
redemption, the dividend rate in effect on the date such redemption price was to
have been paid. The Percentage used to determine the Default Rate for any shares
of Preferred  Stock shall be the Percentage for the rating category below "baa3"
or "BBB-" (i) in effect on the immediately preceding Auction Date or the date of
the  immediately  preceding  Remarketing,  in the case of a  Default  Rate  that
applies to the  portion of a Dividend  Period  occurring  after a failure to pay
dividends and (ii) in effect on the date of determination, in all other cases.

      "Depository  Agreement"  means each agreement among the  Corporation,  the
Remarketing Depository and a Remarketing Agent.

      "Dividend  Determination Method" or "Method" shall mean either the Auction
Method or the Remarketing Method.

      "Dividend  Payment  Date" has the meaning  set forth in Section  3(b)(iii)
below.

      "Dividend Period" has the meaning set forth in Section 3(b)(v) below.

      "Dividend Quarter" has the meaning set forth in Section 3(b)(iii) below.

      "Dividends-Received  Deduction"  has the  meaning  set  forth  in  Section
3(f)(v) below.

      "Existing  Holder"  means a Person  who has  signed  a Master  Purchaser's
Letter and is listed as the beneficial owner of any shares of Auction  Preferred
in the records of the Auction Agent.

      "Failure to Deposit"  means the failure by the  Corporation  to pay to the
Paying Agent by 11:00 A.M., New York City Time, in immediately  available funds,
(i) on a Dividend Payment Date, the full amount of any dividend  (whether or not
earned or  declared) to be paid on such  Dividend  Payment Date on any shares of
Preferred  Stock  or (ii) on any  redemption  date,  the full  redemption  price
(including accumulated and unpaid dividends), to be paid on such redemption date
for any shares of Preferred Stock.

      "Federal  Reserve  Board"  means the  Board of  Governors  of the  Federal
Reserve System.

      "First Boston" means The First Boston Corporation.

      "Holder"  means an Existing  Holder or any  beneficial  owner of Preferred
Stock acquired pursuant to a Remarketing.

                                       12

<PAGE>

      "Initial  Auction Date" means the Business Day  immediately  preceding the
first day of a Dividend Period for Auction Preferred.

      "Initial Dividend Rate" has the meaning set forth in Section 3(g)(i)
below.

      "Initial  Dividend  Period"  means the periods  commencing  on the Date of
Original  Issue and ending on the  respective  days  immediately  preceding  the
Initial Dividend Payment Dates for each Series of Preferred Stock.

      "Initial  Dividend Payment Date" has the meaning set forth in Section 3(b)
below.

      "Long Dividend Period" has the meaning set forth in Section 3(b)(v) below.

      "Marketing  Conditions"  means the following  factors:  (i) short-term and
long-term market rates and indices of such short-term and long-term rates,  (ii)
market supply and demand for  short-term and long-term  securities,  (iii) yield
curves for  short-term  and  long-term  securities  comparable  to the Preferred
Stock,  (iv)  industry and financial  conditions  which may affect the Preferred
Stock,  (v) the number of shares of  Preferred  Stock to be sold  pursuant to an
Auction  or a  Remarketing,  as the case may be,  (vi) the  number of  potential
purchasers of Preferred Stock,  (vii) the Dividend Periods and dividend rates at
which  current and  potential  holders  would remain or become  holders,  (viii)
current tax laws and  administrative  interpretations  with respect  thereto and
(ix) the Corporation's  current and projected funding  requirements based on its
asset and liability position, tax position and current financing objectives.  If
Marketing  Conditions are being assessed by the Chief  Financial  Officer,  such
officer's  evaluation  of the factors  described in clauses (vi) and (vii) above
may be  based on  discussions  with one or more  Broker-Dealers  or  Remarketing
Agents.

      If Marketing  Conditions are being assessed by the Term Selection Agent or
the Method Selection Agent,  such agent's  evaluation of the factor described in
clause  (ix)  above  may be based on  discussions  with  representatives  of the
Corporation.

      "Maximum  Applicable  Rate",  as of any date,  means the rate  obtained by
multiplying the Applicable Determining Rate then in effect for a Dividend Period
by the  Percentage  (as it may be  adjusted  from time to time  based on certain
factors by the Chief Financial Officer in accordance with the provisions hereof)
determined as set forth below based on the lower of the credit ratings  assigned
to the Preferred Stock by Moody's and S&P.

<TABLE>
<CAPTION>
                                   Credit Rating
------------------------------------------------------------------------------
 <S>                                                <C>                                     <C>
              Moody's                                  S & P                                Percentage
         "aa3" or Above                             AA- or Above                                 150%
         "a3" to "a1"                               A- to A+                                     200%
         "baa3" to "baa1"                           BBB- to BBB+                                 225%
         Below "baa3"                               Below BBB                                    275%
</TABLE>

      The  Corporation  will  take all  reasonable  action  necessary  to enable
Moody's and S&P to provide ratings for the Preferred Stock. If either Moody's or
S&P does not make such rating  available  or neither  Moody's nor S&P shall make
such a rating  available,  the  Corporation  will  designate a rating  agency or
rating agencies as a substitute rating agency or substitute rating agencies,  as
the case may be,  subject to the  approval of Morgan  Stanley and First  Boston,
such approval not to be unreasonably withheld, and the Corporation will take all
reasonable  action to enable such rating agency or rating  agencies to provide a
rating or ratings for each Series of Preferred  Stock.  If either Moody's or S&P
shall  change its

                                       13
<PAGE>

rating  categories  for preferred  stock,  or if one or more  substitute  rating
agencies are  designated,  then the  determination  set forth above will be made
based upon the  substantially  equivalent  new rating  categories  for preferred
stock of such rating agency or substitute rating agency.

      "Memorandum"  means the Private  Placement  Memorandum  dated December 16,
1992  relating to the  Corporation  and the placement of the shares of Preferred
Stock.

      "Method  Selection Agent" means any entity appointed by the Corporation to
act on its behalf in selecting  Dividend  Determination  Methods for a Series of
Preferred  Stock,  provided that if the Corporation  shall appoint more than one
entity to so act with respect to a Series,  "Method Selection Agent" shall mean,
unless the context otherwise requires, all entities so appointed.

      "Method  Selection  Agreement" means an agreement  between the Corporation
and the Method  Selection  Agent  pursuant to which the Method  Selection  Agent
agrees to determine the Method applicable to a Series of Preferred Stock.

      "Minimum Holding Period" has the meaning set forth in Section 3(f)(v)
below.

      "Moody's" means Moody's Investors Service, Inc., or its successor, so long
as such agency (or  successor)  is in the business of rating  securities  of the
type of the Preferred Stock and, if such agency is not in such business,  then a
Substitute Rating Agency.

      "Morgan Stanley" means Morgan Stanley & Co. Incorporated.

      "Normal  Dividend  Payment  Date" has the  meaning  set  forth in  Section
3(b)(ii) below.

      "Notice of Change in Dividend Period" has the meaning set forth in Section
3(d)(ii) below.

      "Notice  of  Method  Revocation"  has the  meaning  set  forth in  Section
3(C)(ii) below.

      "Notice of Method  Selection" has the meaning set forth in Section 3(C)(i)
below.

      "Notice  of  Percentage  Increase"  has the  meaning  set forth in Section
3(h)(i) below.

      "Notice of Removal" has the meaning set forth in Section 3(C)(iii) below.

      "Notice of Revocation" has the meaning set forth in Section 3(d)(ii)
below.

      "Outstanding" means, as of any date, shares of Preferred Stock theretofore
issued  except,   without  duplication,   (i)  any  shares  of  Preferred  Stock
theretofore cancelled, delivered to the Corporation for cancellation or redeemed
and (ii) as of any Auction  Date or  Remarketing  Date,  any shares of Preferred
Stock subject to redemption on the next following Business Day.

      "Participant" means the member of the Securities  Depository that will act
on behalf of an Existing  Holder or a Potential  Holder,  in the case of Auction
Preferred,  or the beneficial owner, in the case of Remarketing  Preferred,  and
that is  identified  as  such in such  Holder's  or  Potential  Holder's  Master
Purchaser's Letter.

      "Paying  Agent"  means the  Auction  Agent  unless  another  bank or trust
company  has  been  appointed  to act as the  paying  agent  for the  shares  of
Preferred Stock by resolution of the Board of Directors.


                                       14

<PAGE>

      "Percentage" has the meaning set forth in Section 3(h)(i) below.

      "Person" means and includes an individual, a partnership, a corporation, a
trust,  an  unincorporated  association,  a joint  venture or other  entity or a
government or any agency or political subdivision thereof.

      "Purchaser's  Letter" means a Master Purchaser's  Letter  substantially in
the form of Appendix E to the Memorandum  delivered to the initial purchasers of
the Preferred Stock which each prospective  purchaser of Preferred Stock will be
required to sign as a condition to purchasing  Preferred Stock or  participating
in an Auction or Remarketing.

      "Redemption  Agent" means the Auction  Agent unless  another bank or trust
company  has been  appointed  to act as the  redemption  agent for the shares of
Preferred Stock by resolution of the Board of Directors.

      "Remarketing" means the implementation of Remarketing Procedures.

      "Remarketing  Agent" means, at any time, the entity or entities  appointed
by the  Corporation  to act on its  behalf in  establishing  dividend  rates and
Dividend  Periods for  Remarketing  Preferred and to act on behalf of holders of
Remarketing  Preferred in remarketing such Remarketing  Preferred as provided in
the Remarketing Procedures.

      "Remarketing Depository" means The Bank of New York, and its successors or
any other  depository  selected by the  Corporation  which  agrees to follow the
procedures  required to be followed by such depository in connection with shares
of Remarketing Preferred with a Dividend Period of less than 7 days.

      "Remarketing  Method" means a method of determining  Dividend  Periods and
dividend rates for the Preferred Stock.

      "Remarketing Preferred" means the Preferred Stock, including the Converted
Auction  Preferred  for which the dividend  rate and  Dividend  Period are to be
determined pursuant to the Remarketing Method.

      "Remarketing  Procedures"  means the procedures for remarketing  shares of
Remarketing Preferred as set forth in Section 9.

      "Securities  Depository"  means The Depository  Trust Company or any other
securities  depository  selected  by the  Corporation  that agrees to follow the
procedures  required to be followed by such securities  depository in connection
with the Preferred Stock.

      "Series"  means any of the Series G, Series H, Series I or Series J of the
Preferred Stock authorized by this Certificate.

      "Short Dividend Period" has the meaning set forth in Section 3(b)(v)
below.

      "Standard  Dividend  Period" has the meaning set forth in Section  3(b)(v)
below.

      "Standard & Poor's" or "S&P" means Standard & Poor's  Corporation,  or its
successor,  so long as such agency (or  successor)  is in the business of rating
securities of the type of the Preferred Stock and, if such agency is not in such
business, then a Substitute Rating Agency.


                                       15

<PAGE>

      "Stock Books" means the stock transfer books of the Corporation maintained
by the Paying Agent.

      "Substitute  Commercial Paper Dealer" means Goldman, Sachs & Co., Shearson
Lehman Brothers Inc. or Merrill Lynch, Pierce,  Fenner & Smith Incorporated,  or
their  respective  affiliates or successors or, if none of such firms  furnishes
commercial  paper  quotations,  a leading dealer in the commercial  paper market
selected by the Corporation in good faith.

      "Substitute  Rating  Agency"  means a  nationally  recognized  statistical
rating  organization  (as that term is used in the rules and  regulations of the
Securities  Exchange  Act of  1934)  selected  by the  Corporation,  subject  to
approval  by  Morgan  Stanley  and First  Boston,  which  approval  is not to be
unreasonably withheld.

      "Substitute U.S.  Government  Securities  Dealers" means Goldman,  Sachs &
Co.,  Shearson  Lehman  Brothers Inc. or Merrill Lynch,  Pierce,  Fenner & Smith
Incorporated,  or their respective  affiliates or successors or, if none of such
firms provides  quotes in U.S.  government  securities,  a leading dealer in the
government securities market selected by the Corporation in good faith.

      "Tender Agent" means, at any time, the bank or the organization (initially
The Bank of New York)  appointed  by the  Corporation  to perform  the duties of
Tender Agent as provided in the Remarketing Procedures.

      "Term  Selection  Agent" means any entity  appointed by the Corporation to
act on its behalf in  establishing  the length of any Dividend Period other than
the Standard Dividend Period,  the Dividend Payment Dates for any Short Dividend
Period  and,  in the case of any Long  Dividend  Period,  additional  redemption
provisions,  if any,  for a Series of Auction  Preferred,  provided  that if the
Corporation  shall  appoint  more than one  entity to so act with  respect  to a
Series,  "Term  Selection  Agent"  shall  mean,  unless  the  context  otherwise
requires, all entities so appointed.

      "U.S. Government Securities Dealers" means Morgan Stanley and First Boston
or, in lieu thereof, their respective affiliates or successors.

      SECTION 3. Dividends.

      (a)  Holders of shares of  Preferred  Stock  shall be entitled to receive,
when,  as and if  declared  by the  Board  of  Directors  out of  funds  legally
available therefor,  cumulative cash dividends at the Applicable Rate per annum,
determined  as set forth in  Section  3(f)  below,  and no more,  payable on the
respective dates set forth below.

      (b) (i)  Dividends on the shares of  Preferred  Stock of each Series shall
accumulate (whether or not declared) from the Date of Original Issue.

         (ii)  Dividends on each Series of  Preferred  Stock shall be payable on
      the  Initial  Dividend  Payment  Date for such  Series.  After the Initial
      Dividend  Periods,  dividends on any shares of Preferred  Stock with (a) a
      Dividend Period of 1 to 48 days (which, in the case of Auction  Preferred,
      shall be a  period  of days  divisible  by 7) will be  payable  on the day
      following the last day of such Dividend  Period,  (b) a Standard  Dividend
      Period will be payable on the day  following the last day of such Standard
      Dividend  Period  (which last day of such  Standard  Dividend  Period will
      normally  be each  seventh  Wednesday  following  the  preceding  Dividend
      Payment Date for such Series),  (c) a Short  Dividend  Period,  on the day
      following  the last day of such  Short  Dividend  Period and on such other
      Dividend  Payment  Dates as  established  at the time such Short  Dividend


                                       16
<PAGE>

      Period is determined and (d) a Long Dividend Period,  on the day following
      the last day of such Long  Dividend  Period and on the March 31,  June 30,
      September  30 and  December 31 of each year during such  dividend  period.
      Each day on which  dividends on shares of  Preferred  Stock of each Series
      would be payable as  determined  as set forth in this  clause (ii) but for
      adjustments set forth in Section 3(f)(v) below,  other than adjustments to
      reflect changes in the Minimum Holding Period,  is referred to herein as a
      "Normal Dividend Payment Date".

         (iii) Each date on which  dividends  for each share of Preferred  Stock
      shall be payable as set forth  herein is referred to herein as a "Dividend
      Payment  Date".  If  applicable,  the period from the  preceding  Dividend
      Payment Date to the next Dividend  Payment Date for any share of Preferred
      Stock with a Long  Dividend  Period is herein  referred  to as a "Dividend
      Quarter".  Although any particular  Dividend Payment Date may not occur on
      the  originally  scheduled  Normal  Dividend  Payment  Date because of the
      adjustments set forth in Section 3(f)(v) below,  each succeeding  Dividend
      Payment Date shall be, subject to such adjustments, the date determined as
      set forth in clause (ii) above as if each preceding  Dividend Payment Date
      had  occurred  on the  respective  originally  scheduled  Normal  Dividend
      Payment Date.

         (iv)  Dividend  Periods  may be of any  duration  (including  perpetual
      duration)  and  not  less  than  (i)  seven  days in the  case of  Auction
      Preferred (other than Converted Remarketing Preferred) and (ii) one day in
      the  case  of  Remarketing   Preferred   (other  than  Converted   Auction
      Preferred).  The duration of each subsequent Dividend Period following the
      Initial  Dividend  Period for each Series and the Applicable Rate for such
      subsequent Dividend Period will be determined by either the Auction Method
      or the Remarketing Method.

         (v) The Initial  Dividend  Payment Date for the Initial Dividend Period
      for Series G  Preferred  Stock shall be February  11,  1993,  for Series H
      Preferred  Stock shall be February 18, 1993, for Series I Preferred  Stock
      shall be February 25, 1993 and for Series J Preferred Stock shall be March
      4, 1993.  After the Initial  Dividend  Period for each Series of Preferred
      Stock,  each subsequent  Dividend Period for any shares of Preferred Stock
      shall  (except for the  adjustments  for  non-Business  Days  described in
      Section 3(f)(v) below) be 49 days (each such 49-day period, subject to any
      adjustment as a result of a change in law  adjusting  the Minimum  Holding
      Period as described in Section 3(f)(v) below,  being referred to herein as
      a "Standard Dividend Period"), unless as provided in clause (d) below, the
      Term Selection Agent or the applicable  Remarketing Agent, as the case may
      be,  specifies that any such  subsequent  Dividend Period for a particular
      share of  Preferred  Stock shall be (A) a Dividend  Period of 1 to 48 days
      (which  in the  case of  Auction  Preferred,  shall  be a  period  of days
      divisible by 7), (B) a Dividend Period of 50 to 364 days and consisting of
      a whole  number of weeks (a "Short  Dividend  Period")  or (C) a  Dividend
      Period of 365 days or longer and  consisting of a whole number of weeks (a
      "Long  Dividend  Period").  Each  such  Dividend  Period  of 1 to 48 days,
      Standard  Dividend Period,  Short Dividend Period and Long Dividend Period
      (together  with (i) any  Initial  Dividend  Periods  and  (ii) any  period
      commencing on a redemption date on which there is a Failure to Deposit and
      ending on the date the  redemption  price  for such  shares is paid to the
      Paying Agent) being referred to herein as a "Dividend Period").

      (c) (i)  Subject  to  certain  limitations  set forth in clause (v) below,
      either  Dividend  Determination  Method  may be  selected  by  the  Method
      Selection  Agent  for a  Series  of  Preferred  Stock  for any  subsequent
      Dividend  Period with respect to all shares of such Series,  provided that
      such Method  Selection Agent determines at the time of such selection that
      a change in the Dividend  Determination  Method will be the most favorable
      financing  alternative  for the  Corporation  based upon the  then-current
      Marketing  Conditions.  If more  than one  entity  is  serving

                                      17
<PAGE>



      as Method Selection Agent for a Series, such entities shall act in concert
      in performing  their duties,  provided that notices referred to herein may
      be  given  by one  entity  on  behalf  of all such  entities.  The  Method
      Selection Agent for any Series of Preferred Stock will make such selection
      in a notice (a "Notice of Method Selection") sent by such Method Selection
      Agent to the Corporation, the Term Selection Agent, the Auction Agent, the
      Securities Depository,  the Remarketing  Depository,  the Tender Agent and
      any  applicable  Remarketing  Agent by  telephone  (with  confirmation  in
      writing), and to any other record holders of the shares of Preferred Stock
      of such Series by first-class mail,  postage prepaid,  not less then seven
      Business Days prior to the first day of such subsequent  Dividend  Period.
      Each  Notice of Method  Selection  will state the Method  selected  by the
      Method  Selection  Agent. If the Method Selection Agent for a Series which
      is then a Series of Remarketing  Preferred  selects the Auction Method for
      any subsequent Dividend Period, the Remarketing Agent for such Series will
      establish  Dividend Periods and Applicable Rates for shares of such Series
      until the  Initial  Auction  Date in a manner  that will best  promote  an
      orderly  transition  to the Auction  Method.  Any  Dividend  Determination
      Method so  selected  by the  Method  Selection  Agent  for a Series  shall
      continue  in effect  for such  Series  until the  Method  Selection  Agent
      selects the other Method in the aforesaid manner. Until a Method Selection
      Agent for any Series has been appointed, the Dividend Determination Method
      will be the Auction Method.

         (ii) A Notice of Method  Selection  may be revoked (a "Notice of Method
      Revocation")  by the Method  Selection  Agent on or prior to 10:00 A.M. on
      the  second  Business  Day  preceding  the  first  day of the  sub-sequent
      Dividend   Period  by  giving  a  Notice  of  Method   Revocation  to  the
      Corporation,  the Term Selection  Agent,  the Securities  Depository,  the
      Remarketing  Depository,   the  Auction  Agent,   the  Tender  Agent,  any
      applicable Remarketing  Agent and  any other record  holders of the shares
      of Preferred  Stock of such Series.

         (iii) Any Notice of Method  Selection  with  respect to any  subsequent
      Dividend  Period for any Series of Preferred Stock shall be deemed to have
      been  withdrawn if on or prior to the second  Business Day  preceding  the
      first day of such subsequent  Dividend  Period the Corporation  shall have
      removed the Method  Selection  Agent for such  Series,  provided  that the
      Corporation  shall have given a notice (a "Notice of Removal") to the Term
      Selection Agent, the Securities  Depository,  the Remarketing  Depository,
      the Auction Agent, the Tender Agent, any applicable  Remarketing Agent and
      any other record  holders of shares of  Preferred  Stock of such Series no
      later than 3:00 P.M., New York City time, on such second  Business Day. If
      more than one entity has been appointed and is acting as Method  Selection
      Agent for that Series,  such Notice of Method Selection shall be deemed to
      have been  withdrawn only if the  Corporation  shall have removed all such
      entities;  and the removal at any time by the  Corporation  of one or more
      but not all such entities shall not effect a deemed withdrawal of a Notice
      of Method  Selection  and in any such event no Notice of  Removal  need be
      given.  If the Method  Selection  Agent for any Series of Preferred  Stock
      resigns or is removed  (or,  in either  case,  if more than one entity has
      been  appointed  and is acting as Method  Selection  Agent for that Series
      then all such entities),  the Dividend  Determination Method applicable to
      such  Series in effect at the time of such  resignation  or  removal  will
      continue  in effect  until the  Corporation  appoints a  successor  Method
      Selection  Agent for such Series and such Method  Selection  Agent sends a
      Notice of Method Selection.  If, as a result of the resignation or removal
      of the Method Selection Agent, the Dividend  Determination  Method for any
      Series will  continue to be the Auction  Method,  then the duration of the
      next  succeeding  Dividend  Period for such  Series  will be the  Standard
      Dividend Period.

         (iv) Any Method for a Series of Preferred  Stock selected by the Method
      Selection Agent for such Series  pursuant to a Notice of Method  Selection
      (except a Notice of Method  Selection  that is

                                       18
<PAGE>




      revoked or deemed to have been withdrawn)  shall be conclusive and binding
      on the Corporation  and the holders of Preferred Stock of such Series.  If
      the  Notice  of Method  Selection  is not  revoked  or deemed to have been
      withdrawn,  any Method so  selected  by the Method  Selection  Agent for a
      Series will continue in effect for that Series until such Method Selection
      Agent or any successor  selects the other Method in the aforesaid  manner.
      No  defect  in the  Notice  of  Method  Selection,  the  Notice  of Method
      Revocation  or the Notice of Removal of the Method  Selection  Agent or in
      the  mailing  thereof  shall  affect  the  validity  of any  change in the
      Dividend Determination Method or any withdrawal, revocation or removal.

                  (v) Notwithstanding the foregoing,  the Method Selection Agent
      shall not be entitled  to change the  Dividend  Determination  Method then
      applicable  to a  Series  if (i) at  the  time  of an  election  that  the
      Remarketing  Method apply to a Series,  the  Corporation has not appointed
      (and given notice or taken such other  action as may be necessary  for the
      timely  effectiveness of such  appointment) a Remarketing  Agent, a Tender
      Agent,  a Securities  Depository  and a  Remarketing  Depository  for such
      Series, (ii) at the time of an election that the Auction Method apply to a
      Series,  the Corporation has not appointed (and given notice or taken such
      other action as aforesaid) an Auction Agent,  a Securities  Depository and
      at least one  Broker-Dealer for such Series, or such election would result
      in more than one Dividend Period for the shares of Preferred Stock of such
      Series or (iii) at the time of any such election, a Failure to Deposit has
      occurred and is continuing. Once the Method Selection Agent has selected a
      Dividend  Determination  Method for a Series in the aforesaid manner, such
      selection shall become effective on the last day of the Dividend Period(s)
      then   applicable   to  shares   of   Preferred   Stock  of  such   Series
      notwithstanding  any Failure to Deposit  for such  Series  which may occur
      after  the  delivery  of the  Notice of Method  Selection  by such  Method
      Selection  Agent,  the failure to remarket  tendered shares of Remarketing
      Preferred of such Series,  in the case of the selection of the  emarketing
      Method,  or the lack of  Sufficient  Clearing Bids in the Auction for such
      Series, in the case of the selection of the Auction Method.

      (d) (i) With  respect  to shares of  Auction  Preferred,  each  successive
      Dividend  Period  shall  commence  on the  Dividend  Payment  Date for the
      preceding Dividend Period for such Series and shall end (A) in the case of
      a Dividend Period of 7 to 48 days or a Standard  Dividend  Period,  on the
      day  preceding  the next  Dividend  Payment  Date and (B) in the case of a
      Short Dividend  Period or a Long Dividend  Period,  on the last day of the
      Short  Dividend  Period  or Long  Dividend  Period,  as the  case  may be,
      specified by the Term Selection  Agent, in the related Notice of Change in
      Dividend Period.

         (ii) The Term Selection  Agent will give telephonic and written notice,
      not less than 10 and not more than 30 days  prior to an  Auction  Date and
      based on the then-current  Marketing Conditions,  to the Corporation,  the
      Auction Agent, the Method  Selection Agent, the Securities  Depository and
      any other record holders of a Series of Auction Preferred if it determines
      that  the next  succeeding  Dividend  Period  for  such  Series  will be a
      Dividend  Period  of 7 to 48  days,  a  Short  Dividend  Period  or a Long
      Dividend  Period  (any  such  notice,  a "Notice  of  Change  in  Dividend
      Period");  provided, that if the then-current Dividend Period is less than
      10 days,  the Term  Selection  Agent  will give  such  Notice of Change in
      Dividend  Period no less than 5 days prior to an Auction  Date.  Each such
      Notice of Change in Dividend Period shall be in substantially  the form of
      Exhibit D to the Auction  Agent  Agreement and shall specify the following
      terms,  (A) the next  succeeding  Dividend  Period  for such  Series  as a
      Dividend  Period  of 7 to 48  days,  a  Short  Dividend  Period  or a Long
      Dividend  Period;  provided  that a Dividend  Period of 7 to 48 days shall
      only be  established  so long  as  corporate  holders  of such  Series  of
      Preferred  Stock  shall  not lose  entitlement  to the  Dividends-Received
      Deduction as a result of the length of such Dividend Period,


                                       19
<PAGE>

      (B) the term  thereof,  (C) in the case of a Short  Dividend  Period,  the
      Dividend  Payment Dates with respect thereto and (D) in the case of a Long
      Dividend  Period,  additional  redemption  provisions or  restrictions  on
      redemption, if any, as authorized in Section 4(b)(ii) hereof. However, for
      any Auction occurring after the initial Auction,  the Term Selection Agent
      may not give a Notice of Change in Dividend Period (and any such Notice of
      Change  in  Dividend  Period  shall be null and  void)  unless  Sufficient
      Clearing Bids were made in the last  occurring  Auction for any Series and
      full  cumulative  dividends,  if any, for all Series of Auction  Preferred
      payable prior to the date of such notice have been paid in full.  The Term
      Selection  Agent may establish a Dividend  Period of 7 to 48 days, a Short
      Dividend  Period or a Long  Dividend  Period for any  Series of  Preferred
      Stock,  if the Term Selection  Agent  determines that such Dividend Period
      and,  in  the  case  of a  Long  Dividend  Period,  additional  redemption
      provisions or restrictions on redemption, provide the Corporation with the
      most favorable financing alternative based upon the then-current Marketing
      Conditions.  A Notice of Change in  Dividend  Period may be revoked by the
      Term  Selection  Agent on or prior to 10:00 A.M. New York City time on the
      related  Auction  Date by  telephonic  and  written  notice (a  "Notice of
      Revocation"),  in substantially the form of Exhibit E to the Auction Agent
      Agreement,  to the  Corporation,  the Auction Agent,  the Method Selection
      Agent,  the  Securities  Depository  and any other  record  holders of the
      shares  of such  Series,  specifying  that the Term  Selection  Agent  has
      determined   that  because  of  subsequent   changes  in  such   Marketing
      Conditions,  such Dividend  Period would not result in the most  favorable
      financing alternative for the Corporation.  Notices of Revocation given by
      the  Term  Selection  Agent  will  be  conclusive  and  binding  upon  the
      Corporation and the holders of shares of Auction  Preferred and, except as
      set forth  below in clause  (iv),  a Notice of Change in  Dividend  Period
      given by the Term Selection  Agent will be conclusive and binding upon the
      Corporation and the holder of shares of Auction Preferred.

         (iii) Any  Notice of Change in  Dividend  Period  with  respect  to any
      subsequent  Dividend  Period for any Series of Auction  Preferred  will be
      deemed to have been  withdrawn  if on or prior to the second  Business Day
      preceding  an Auction  Date the  Corporation  shall have  removed the Term
      Selection Agent,  provided that the Corporation shall have given Notice of
      Removal  to  the  Auction  Agent,  the  Method  Selection  Agent  and  the
      Securities  Depository  and any other record holders of the shares of such
      Series,  no later  than 3:00  P.M.,  New York City  time,  on such  second
      Business  Day. If the Term  Selection  Agent  resigns or is  removed,  the
      Dividend  Period for each Series of Auction  Preferred shall be a Standard
      Dividend Period until the Corporation  appoints a successor Term Selection
      Agent for such  Series  and such Term  Selection  Agent  sends a Notice of
      Change in Dividend Period.

         (iv) If the Term  Selection  Agent  does not give a Notice of Change in
      Dividend  Period with respect to the next  succeeding  Dividend Period for
      any  Series of Auction  Preferred  or has given such a Notice of Change in
      Dividend  Period and gives a Notice of Revocation  with respect thereto or
      such Notice of Change in Dividend  Period is deemed to be withdrawn,  such
      next succeeding  Dividend Period shall be a Standard  Dividend Period with
      respect to such Series. In addition, in the event the Term Selection Agent
      has given a Notice of Change in Dividend  Period with  respect to the next
      succeeding Dividend Period for a Series of Preferred Stock and such notice
      has not been revoked or deemed to be withdrawn,  but  Sufficient  Clearing
      Bids are not made in the related  Auction or such  Auction is not held for
      any reason,  such next  succeeding  Dividend  Period for such Series will,
      notwithstanding  such Notice of Change in Dividend  Period,  be a Standard
      Dividend  Period and the Term Selection  Agent may not again give a Notice
      of Change in  Dividend  Period  (and any such Notice of Change in Dividend
      Period shall be null and void) for such Series until  Sufficient  Clearing
      Bids have been made in an Auction for such Series.

                                       20
<PAGE>

      (e) (i) With respect to shares of Remarketing  Preferred,  the duration of
      each  subsequent  Dividend  Period and the  Applicable  Rate for each such
      subsequent  Dividend Period shall be established by the Remarketing  Agent
      for such  shares  of  Remarketing  Preferred  and will be  conclusive  and
      binding on the Corporation and the holders of such shares.

          (ii) For each  Dividend  Period the applicable Remarketing Agent shall
      establish a dividend rate, not in excess of the Maximum  Applicable  Rate,
      which it determines  shall be the lowest rate at which tendered  shares of
      Remarketing  Preferred  would be  remarketed  at  $250,000  per share.  In
      establishing  each Dividend  Period and dividend  rate,  each  Remarketing
      Agent  will  establish  Dividend  Periods  and  dividend  rates  which  it
      determines will result in the most favorable financing alternative for the
      Corporation based on the then-current Marketing Conditions.

         (iii)  Each  Holder  will be  deemed  to have  tendered  its  shares of
      Remarketing  Preferred  for  sale  by  Remarketing  on  the  Business  Day
      immediately  preceding the first day of each  subsequent  Dividend  Period
      applicable   thereto,   unless  it  gives  irrevocable  notice  otherwise.
      Consequently,  a Holder will hold shares of Remarketing Preferred only for
      a Dividend  Period and at a dividend rate accepted by that holder,  except
      for one or more  successive  Dividend  Periods of one day resulting from a
      Failure to Deposit or the  failure to remarket  such  shares as  described
      below. At any time, any or all shares of Remarketing Preferred of a Series
      may have  Dividend  Periods of various  lengths.  Depending  on  Marketing
      Conditions at the time of  Remarketing,  any or all shares  of Remarketing
      Preferred of a Series may have different Applicable Rates, including those
      set on the same day for Dividend Periods of equal length.

      (f) (i) Not later  than  11:00  A.M.  New York  City time on the  Dividend
      Payment Date (except as provided in Section  3(f)(v) below) for each share
      of Preferred Stock, the Corporation is required to deposit with the Paying
      Agent sufficient  immediately  available funds for the payment of declared
      dividends.

            (ii) Each  dividend  shall be  payable  to the  holder or holders of
      record of such shares of Preferred  Stock as such holders' names appear on
      the Stock Books on the Business Day next preceding the applicable Dividend
      Payment  Date.  Subject  to  Section  3(i)  below,  dividends  in  arrears
      (including any Additional Payments) for any past Dividend Payment Date may
      be  declared  by the  Board of  Directors  and paid at any  time,  without
      reference to any regular  Dividend  Payment Date, to the holder or holders
      of record as such holders appear on the Stock Books as of the Business Day
      next  preceding such Dividend  Payment Date. Any dividend  payment made on
      any  shares  of  Preferred  Stock  shall  first be  credited  against  the
      dividends  accumulated with respect to the earliest  Dividend Payment Date
      for which dividends have not been paid with respect to such shares.

         (iii) So long as the  shares of  Preferred  Stock are held of record by
      the nominee of the Securities Depository or the Remarketing Depository, as
      the case may be,  dividends  will be paid to the nominee of the Securities
      Depository or the Remarketing  Depository,  on each Dividend Payment Date.
      Dividends  on  shares of  Preferred  Stock  held  through  the  Securities
      Depository will be paid through the Securities Depository on each Dividend
      Payment Date in accordance with its normal procedures.

         (iv) Dividends on any shares of Preferred Stock held by the Remarketing
      Depository  will  be  paid  through  the  Remarketing  Depository  on each
      Dividend  Payment Date by wire or other transfer of immediately  available
      funds to a Holder's account with a commercial bank in the United States so
      long as such  Holder has  provided  the  Remarketing  Depository  with the
      necessary

                                       21
<PAGE>

      information  to effect such  transfer.  Any  payments  not made by wire or
      other  transfer  will be made by check  to the  Holder  of such  Preferred
      Stock.

         (v) In the  case of  dividends  payable  with  respect  to a  share  of
      Preferred  Stock  with a  Dividend  Period  of 7 to 48  days,  a  Standard
      Dividend Period or a Short Dividend Period, if:


                  (A) (x)  The  Securities  Depository  shall  continue  to make
            available  to  Participants  the  amounts due as  dividends  on such
            shares of  Preferred  Stock in next-day  funds on the dates on which
            such dividends are payable and (y) a Normal Dividend Payment Date is
            not a Business Day, or the day next  succeeding such Normal Dividend
            Payment Date is not a Business Day, then dividends  shall be payable
            on the first  Business Day preceding  such Normal  Dividend  Payment
            Date that is next succeeded by a Business Day; or

                 (B) (x) The  Securities  Depository  shall  make  available  to
            Participants  the  amounts  due  as  dividends  on  such  shares  of
            Preferred Stock in immediately available funds on the dates on which
            such dividends are payable (and the Securities Depository shall have
            so advised the Auction Agent) and (y) a Normal Dividend Payment Date
            is not a Business Day, then dividends  shall be payable on the first
            Business Day following such Normal Dividend Payment Date.

                  (C) In the case of dividends payable with respect to shares of
            Preferred Stock with a Long Dividend Period, if:

                  (I) (x)  The  Securities  Depository  shall  continue  to make
                  available to its  Participants the amounts due as dividends on
                  such shares of Preferred  Stock in next-day funds on the dates
                  on which such dividends are payable and (y) a Normal  Dividend
                  Payment Date is not a Business Day, or the day next succeeding
                  such Normal Dividend  Payment Date is not a Business Day, then
                  dividends shall be payable on the first Business Day following
                  such Normal Dividend  Payment Date that is next succeeded by a
                  Business Day; or

                  (II) (x) The Securities Depository shall make available to its
                  Participants  the amounts due as  dividends  on such shares of
                  Preferred Stock in immediately available funds on the dates on
                  which  such   dividends   are  payable  (and  the   Securities
                  Depository  shall have so advised the Auction Agent) and (y) a
                  Normal  Dividend  Payment  Date is not a  Business  Day,  then
                  dividends shall be payable on the first Business Day following
                  such Normal Dividend Payment Date.

                  (D)  Notwithstanding  the  foregoing,  in case of  payment  in
            next-day  funds,  if the  date  on  which  dividends  on  shares  of
            Preferred  Stock  would be  payable  as  determined  as set forth in
            clauses  (A), (B) and (C) above is a day that would  result,  due to
            such procedures,  in the number of days between  successive  Auction
            Dates or Remarketing Dates for such shares  (determined by excluding
            the first Auction Date or Remarketing  Date, as the case may be, and
            including the second Auction Date and the second  Remarketing  Date,
            as the case may be),  not being at least  equal to the  then-current
            minimum holding period (currently set forth in Section 246(c) of the
            Code)  (the  "Minimum  Holding   Period")   required  for  corporate
            taxpayers  to be entitled to the  dividends-  received  deduction on
            preferred stock held by  nonaffiliated  corporations  (currently set
            forth  in  Section  243(a)  of the  Code)  (the  "Dividends-Received
            Deduction"),  then  dividends on such shares shall be payable on the
            first Business Day following such date on which  dividends  would be
            so payable that is next  succeeded by a


                                       22

<PAGE>
            Business  Day  that  results  in the  number  of days  between  such
            successive  Auction Dates or Remarketing  Dates,  as the case may be
            (determined  as set forth  above),  being at least equal to the then
            current Minimum Holding Period.

                  (E) In addition,  notwithstanding the foregoing,  in the event
            of a change in law altering the Minimum Holding  Period,  the period
            of time  between  Dividend  Payment  Dates  shall  automatically  be
            adjusted  so  that  there  shall  be a  uniform  number  of  days in
            subsequent  Dividend  Periods  (such number of days  without  giving
            effect to the adjustments referred to above being referred to herein
            as "Subsequent  Dividend Period Days")  commencing after the date of
            such change in law equal to or, to the extent  necessary,  in excess
            of the then current Minimum Holding Period; provided that the number
            of  Subsequent  Dividend  Period  Days shall not exceed by more than
            nine days the length of such then-current Minimum Holding Period and
            shall be  evenly  divisible  by  seven,  and the  maximum  number of
            Subsequent  Dividend  Period  Days,  as  adjusted  pursuant  to this
            provision, in no event shall exceed 119 days.

                  (F)  If  a  Normal   Dividend   Payment  Date  for  shares  of
            Remarketing  Preferred with Dividend  Periods of less than 7 days is
            not a Business  Day,  then  dividends  shall be payable on the first
            Business Day following such Normal Dividend Payment Date.

      (g) (i) For the Initial  Dividend  Periods  dividends will accumulate at a
rate per  annum of 3.25%  for  Series G  Preferred  Stock,  3.25%  for  Series H
Preferred  Stock,  3.25% for Series I  Preferred  Stock,  and 3.25% for Series J
Preferred Stock (in each case, the "Initial  Dividend Rate").  The dividend rate
for each share of Preferred Stock for each  subsequent  Dividend Period shall be
the Applicable  Rate  determined by either the Auction Method or the Remarketing
Method.

      (ii)  Notwithstanding  the application of either the Auction Method or the
      Remarketing  Method,  the dividend  rate on each share of Preferred  Stock
      shall not exceed the Maximum  Applicable  Rate per annum for any  Dividend
      Period;  provided,  however,  that  the  Chief  Financial  Officer  of the
      Corporation (the "Chief  Financial  Officer") based on certain factors may
      increase the Percentage  used to calculate the Maximum  Applicable Rate at
      any time up to certain  amounts set forth below in Section  3(h)(ii).  The
      provisions of the immediately preceding sentence  notwithstanding,  at any
      time that the  application of the provisions  with respect to a Failure to
      Deposit  would,  but  for  the  provisions  of the  immediately  preceding
      sentence, result in a dividend rate on a share of Preferred Stock being in
      excess of the Maximum Applicable Rate per annum, the maximum dividend rate
      applicable to such share of Preferred  Stock shall be such higher dividend
      rate as provided below.

      (h) (i) Not later than 10:00  A.M.,  New York City  time,  on the  related
Auction Date or Remarketing  Date, as the case may be, and based on the criteria
set forth below,  the Chief  Financial  Officer may, upon telephonic and written
notice, to the Auction Agent, each applicable  Remarketing Agent, the Securities
Depository,  the Remarketing Depository and any other record holder of shares of
Preferred Stock affected  thereby,  increase the percentage  (the  "Percentage")
used to calculate the Maximum  Applicable Rate for any shares of Preferred Stock
(a "Notice of Percentage  Increase").  Such Notice of Percentage  Increase shall
specify the new Percentages to be used to calculate the Maximum  Applicable Rate
and  shall  be in  substantially  the form of  Exhibit  G to the  Auction  Agent
Agreement.

      The Chief  Financial  Officer may increase such  Percentages  if the Chief
Financial   Officer   determines  that  supervening   considerations   make  the
Percentages  then  in  effect  inimical  to  the  financial   interests  of  the
Corporation  and that such  increase is necessary to enable the operation of the
then-

                                       23
<PAGE>


applicable  Method to provide the Corporation with the most favorable  financing
alternatives  based on then-current  Marketing  Conditions.  The Chief Financial
Officer  may not  revoke a Notice of  Percentage  Increase  and the  Percentages
specified  therein will be the applicable  Percentages for the  determination of
the Maximum Applicable Rate with respect to such shares for subsequent  Dividend
Periods,  except as described below,  until a new Notice of Percentage  Increase
shall be delivered in accordance with the terms thereof.

         (ii) Except as described  below,  the Chief  Financial  Officer may not
      increase the Percentage  used to calculate the Maximum  Applicable Rate to
      above the  Percentages  set forth in the third  column of the table  below
      corresponding to the applicable  credit ratings set forth in the first two
      columns of the table below.

<TABLE>
<CAPTION>

                            Credit Rating                                             Maximum Percentage
                                                                                       Permitted to be
                                                                                      Used to Calculate
                                                                                      Maximum Applicable
               Moody's                        Standard & Poor's                              Rate
               -------                        -----------------                       ------------------

<S>                                           <C>                                    <C>
           "aa3" or Above                       AA- or Above                                 175%
            "a3" to "a1"                          A- to A+                                   225%
          "baa3" to "baa1"                      +BBB- to BBB                                 250%
            Below "baa3"                          Below BBB                                  275%
</TABLE>


            The maximum  percentages  set forth in the third column of the above
            table may be increased by the Chief Financial Officer,  upon receipt
            of an opinion of counsel  addressed to the Corporation to the effect
            that the use of such higher  percentages  to  calculate  the Maximum
            Applicable  Rate will not adversely  affect the tax treatment of the
            Preferred Stock.

         (iii)  The  Chief  Financial  Officer  may only  raise  the  Percentage
      applicable to a Series of Auction Preferred if the Chief Financial Officer
      raises  such  Percentage  for all the  shares  of such  Series.  The Chief
      Financial  Officer may, however,  only raise the Percentage  applicable to
      shares  of   Remarketing   Preferred  with  respect  to  those  shares  of
      Remarketing  Preferred being remarketed on the same date, and shall not be
      required  to raise  the  Percentage  applicable  to any  other  shares  of
      Remarketing Preferred. However, if the Percentage applicable to a share of
      Remarketing  Preferred is less than the Percentage applicable to any other
      share of Remarketing  Preferred of the same Series,  the lower  Percentage
      applicable to such share shall, at the end of the current  Dividend Period
      for such share,  automatically be increased to the highest Percentage then
      applicable to any share of  Remarketing  Preferred of such Series,  unless
      the Chief  Financial  Officer  elects to increase  further the  Percentage
      applicable to such share.

      (i) (A) In the event a Failure to Deposit  occurs and any such  Failure to
      Deposit  shall not have been cured within three  Business  Days after such
      occurrence,  then until  such time as the full  amount due shall have been
      paid to the Paying  Agent,  the  Auction  Procedures  and the  Remarketing
      Procedures will be suspended. The Applicable Rate for each Dividend Period
      commencing on or after any such Dividend Payment Date (or redemption date,
      as the case may be) on which  there has been a Failure to Deposit and such
      Failure to Deposit has not been cured within three  Business Days shall be
      equal to the Default Rate for such Dividend  Period.  In addition,  if any
      such Dividend Payment Date was not the last day of a Dividend Period,  the
      Applicable Rate for the portion of such Dividend Period commencing on such
      Dividend  Payment Date and ending on the day preceding the next succeeding
      Dividend Payment Date shall be the Default Rate for

                                       24

<PAGE>


      such period, computed as if such period were a "Dividend Period". If there
      has been a failure to pay dividends on the last day of a Dividend  Period,
      the  Dividend  Period to which such  Default  Rate will  apply  shall be a
      Standard  Dividend Period in the case of Auction  Preferred and successive
      one day periods in the case of Remarketing Preferred.  If there has been a
      failure to pay the  redemption  price of shares of Preferred  Stock called
      for redemption,  the Dividend Period to which such Default Rate will apply
      shall be the period commencing on, and including,  the redemption date and
      ending on, but  excluding,  the date the  redemption  price is paid to the
      Paying Agent. The suspension of the Auction Procedures and the Remarketing
      Procedures  shall  continue  in effect  until there shall occur a Dividend
      Payment  Date at least one  Business Day prior to which the full amount of
      any dividends (whether or not earned or declared) payable on each Dividend
      Payment Date prior to and including such Dividend  Payment Date along with
      any  Additional  Payments then due, and the full amount of any  redemption
      price  (including  accumulated  and unpaid  dividends) then due shall have
      been paid to the Paying Agent,  and thereupon  application  of the Auction
      Procedures and the Remarketing Procedures shall resume for any Outstanding
      shares on the terms stated  herein for Dividend  Periods  commencing  with
      such Dividend  Payment Date. If a Failure to Deposit is cured within three
      Business  Days,  then  the  Applicable  Rate  will  be the  dividend  rate
      established in connection with any Auction or Remarketing relating to such
      shares of Preferred Stock conducted  immediately  preceding the Failure to
      Deposit,  provided that the Applicable  Rate shall be the Default Rate for
      each day  (excluding  the date of deposit) until the Failure to Deposit is
      cured.  Such  Default  Rate shall be computed  using the  Dividend  Period
      established in connection with any Auction or Remarketing relating to such
      shares of Preferred Stock conducted  immediately  preceding the Failure to
      Deposit.

             (B) Any Failure to Deposit  with  respect to any share of Preferred
      Stock shall be deemed to be cured if, with respect to a Failure to Deposit
      relating  to (a) the  payment of  dividends  on such  shares of  Preferred
      Stock,  the Corporation  deposits with the Paying Agent by 11:00 A.M., New
      York City time,  all  accumulated  and unpaid  dividends on such shares of
      Preferred  Stock,  including  the full amount of any  dividends to be paid
      with  respect to the  Dividend  Period or portion  thereof with respect to
      which the Failure to Deposit occurred,  plus Additional Payments,  and (b)
      the redemption of such shares,  the  Corporation  deposits with the Paying
      Agent  by 11:00  A.M.,  New  York  City  time,  funds  sufficient  for the
      redemption of such shares (including accumulated and unpaid dividends) and
      gives irrevocable instructions to apply such funds and, if applicable, the
      income and  proceeds  therefrom,  to the payment of the  redemption  price
      (including  accumulated  and unpaid  dividends)  for such  shares.  If the
      Corporation  shall  have cured  such  Failure to Deposit by making  timely
      payment to the Paying Agent,  either the Auction Agent or the  Remarketing
      Agent, as the case may be, will give telephonic and written notice of such
      cure to each Holder of shares of Preferred  Stock at the telephone  number
      and address  specified in such Holder's Master  Purchaser's  Letter and to
      each  Broker-Dealer,  in the case of the  Auction  Agent,  as  promptly as
      practicable after such cure is effected.  Additional  Payments paid to the
      Paying  Agent with  respect to a Failure to Deposit will be payable to the
      Holders of shares of  Preferred  Stock on the Record Date for the Dividend
      Payment Date with respect to which such Failure to Deposit occurred.

      (j) If an Auction or Remarketing  for any shares of Preferred Stock is not
held on an Auction Date or  Remarketing  Date for any reason (other than because
of the  suspension  of  Auctions or  Remarketing  due to a Failure to Deposit as
described  above),  the  dividend  rate for  such  shares  shall be the  Maximum
Applicable Rate (calculated  assuming a Standard Dividend Period)  determined as
of such Auction  Date or  Remarketing  Date and the  Dividend  Period shall be a
Standard  Dividend  Period,  in the case of Auction  Preferred,  and  successive
Dividend  Periods of one day, in the case of Remarketing  Preferred,  until such
shares of Remarketing Preferred are remarketed.


                                       25
<PAGE>

      (k) The amount of dividends per share payable on any Dividend Payment Date
on a share of Preferred  Stock having a Dividend  Period of up to 364 days shall
be computed by  multiplying  the Applicable  Rate for each Dividend  Period by a
fraction the  numerator  of which shall be the number of days  between  Dividend
Payment Dates (calculated by counting the date of the preceding Dividend Payment
Date as the first day and the day preceding the current Dividend Payment Date as
the last day) and the  denominator  of which shall be 360, and  multiplying  the
amount so  obtained  by  $250,000.  During  any  Dividend  Period of 365 days or
longer,  the amount of dividends  accumulated  on each share will be computed on
the basis of a 360-day year consisting of twelve 30-day months.

      (l) (i) Holders of shares of each Series of  Preferred  Stock shall not be
      entitled to any dividends,  whether payable in cash, property or stock, in
      excess of full  cumulative  dividends.  So long as any shares of Preferred
      Stock are  Outstanding,  the  Corporation  shall not declare or pay or set
      apart for payment any  dividends  or make any other  distributions  on, or
      payment on account of the purchase,  redemption or other retirement of the
      common  stock  of  the  Corporation  or any  other  capital  stock  of the
      Corporation ranking junior to the Preferred Stock as to dividends or as to
      distributions   upon   liquidation,   dissolution  or  winding-up  of  the
      Corporation  unless (i) full  cumulative  dividends on the Preferred Stock
      have been paid (or declared and a sum sufficient  for the payment  thereof
      set apart for such  payment) for all Dividend  Periods  terminating  on or
      prior to the date of such payment,  distribution,  purchase, redemption or
      other  retirement  with respect to such junior  capital stock and (ii) the
      Corporation  is not in default with respect to any obligation to redeem or
      retire  shares  of  the  Preferred  Stock;  provided,  however,  that  the
      foregoing shall not apply to (i) any dividend payable solely in any shares
      of any stock ranking, as to dividends and as to distributions in the event
      of a liquidation,  dissolution or winding-up of the Corporation, junior to
      the  Preferred  Stock or (ii)  the  acquisition  of  shares  of any  stock
      ranking,  as to  dividends  or as  to  distributions  in  the  event  of a
      liquidation,  dissolution or winding-up of the Corporation,  junior to the
      Preferred  Stock in exchange solely for shares of any other stock ranking,
      as to dividends  and as to  distributions  in the event of a  liquidation,
      dissolution  or  winding-up  of the  Corporation,  junior to the Preferred
      Stock.

         (ii) Each  dividend  will be payable to the holder or holders of record
       of shares of  Preferred  stock as they  appear on the Stock  Books on the
       Business  Day  next  preceding  the  applicable  Dividend  Payment  Date.
       Dividends  in  arrears  for any past  Dividend  Period  (and for any past
       Dividend  Payment  Date  occurring  prior  to the end of a Long  Dividend
       Period or a Short Dividend  Period) may be declared and paid at any time,
       without  reference to any regular  Dividend  Payment  Date, to the record
       holders  of such  shares.  Any  dividend  payment  made on any  shares of
       Preferred Stock shall first be credited against the dividends accumulated
       with respect to the earliest  Dividend  Payment Date for which  dividends
       have not been paid with respect to such shares.  So long as the shares of
       Preferred  stock  are held of  record by the  nominee  of the  Securities
       Depository or the Remarketing  Depository,  as the case may be, dividends
       will  be  paid  to  the  nominee  of  the  Securities  Depository  or the
       Remarketing Depository, on each Dividend Payment Date.

         (iii) Unless  otherwise  provided for in the  Restated  Certificate  of
      Incorporation,  as the  same  may be  amended,  of  the  Corporation,  all
      payments in the form of dividends made upon shares of Preferred  Stock and
      any other stock ranking on a parity with the Preferred  Stock with respect
      to such dividend  shall be pro rata, so that amounts paid per share on the
      Preferred Stock and such other stock shall in all cases bear to each other
      the same ratio that the required  dividends  then payable per share on the
      shares of Preferred Stock and such other stock bear to each other.


      SECTION 4. Optional Redemption.

                                       26

<PAGE>


      (a) At the  option  of the  Corporation,  by  resolution  of the  Board of
Directors,  the shares of a Series of Preferred Stock may be redeemed,  in whole
or in  part,  out of funds  legally  available  therefor,  on the  Business  Day
immediately  preceding any Dividend Payment Date for such shares,  upon at least
15 but not more than 45 days notice,  at a  redemption  price per share equal to
the sum of $250,000 plus premium thereon, if any, and an amount equal to accrued
and unpaid  dividends  thereon  (whether or not earned or  declared) to the date
that the  Corporation  pays the full  amount  payable  upon  redemption  of such
shares;  provided that such redemption  date shall be the Dividend  Payment Date
for such shares if the payment on the  Business  Day  preceding  such date would
reduce the holding  period for such shares since the Auction Date or Remarketing
Date preceding such payment below the Minimum Holding  Period.  Pursuant to such
right of optional redemption, the Corporation may elect to redeem some or all of
the shares of  Preferred  Stock of any Series  without  redeeming  shares of any
other Series.

      (b) (i) Notwithstanding  the foregoing,  if any dividends on shares of any
      Series of Preferred Stock are in arrears,  (i) no shares of such Series of
      Preferred  Stock  or of any  other  Series  of  Preferred  Stock  shall be
      redeemed unless all  outstanding  shares of each Series of Preferred Stock
      are simultaneously redeemed and (ii) the Corporation shall not purchase or
      otherwise acquire any shares of Preferred Stock;  provided,  however, that
      the foregoing  shall not prevent the purchase or  acquisition of shares of
      Preferred Stock pursuant to an otherwise lawful purchase or exchange offer
      made on the same terms to all Holders of  Outstanding  shares of Preferred
      Stock.

         (ii) In connection  with the selection of a Long Dividend  Period,  the
      Term Selection Agent or the applicable  Remarketing Agent, as the case may
      be, may restrict the  Corporation's  ability to redeem shares of Preferred
      Stock by  providing  for the payment of a  redemption  premium or fixing a
      period of time  during  which such  shares of  Preferred  Stock may not be
      redeemed if the Term Selection Agent or the applicable  Remarketing Agent,
      as  the  case  be,  determines,   based  on  the  then-current   Marketing
      Conditions,  that  adding  such  terms will  result in the most  favorable
      financing alternative for the Corporation.

      (c) (i) If shares of Preferred  Stock are to be redeemed,  the  Redemption
      Agent will,  at the  direction of the  Corporation,  cause to be sent,  by
      first-class or air mail, postage prepaid,  telex or facsimile, a notice of
      redemption to each holder of record  (initially  Cede & Co., as nominee of
      the Securities  Depository)  of shares of Preferred  Stock to be redeemed.
      Such notice of  redemption  shall be sent not fewer than  fifteen nor more
      than 45 days prior to the redemption  date. Each notice of redemption will
      identify the Preferred Stock to be redeemed by CUSIP number and will state
      (a) the redemption date, (b) the redemption price, (c) the place where the
      redemption  price is to be paid and (d) the number of shares of  Preferred
      Stock and the Series  thereof  to be  redeemed.  The  notice  will also be
      published in The Wall Street Journal.

            (ii) No defect in the  notice of  redemption  or in the  mailing  or
      publication   thereof   will  affect  the   validity  of  the   redemption
      proceedings,  except as required by applicable law. A notice of redemption
      will be deemed given on the day that it is mailed in  accordance  with the
      foregoing description.

            (iii) The  Corporation may elect to redeem some or all of the shares
      of each Series of Preferred Stock.

            (iv) In the case of shares of a Series of Auction Preferred, so long
      as the  Securities  Depository's  nominee  is the  record  holder  of such
      shares,   the  Redemption   Agent  will  give  notice  to  the  Securities
      Depository,  and the  Securities  Depository  will determine the number of
      shares of each such Series to be redeemed from the accounts of each of its
      Participants. A Participant may


                                       27
<PAGE>


      determine to redeem shares from certain of the beneficial  holders holding
      through such Participant  (which may include a Participant  holding shares
      for its own account)  without  redeeming shares from the accounts of other
      beneficial owners.

      Any such  redemption  will be made in accordance  with applicable laws and
rules.

            (v) In the case of shares of Remarketing  Preferred,  notice of such
      redemption shall be given to the Securities  Depository or the Remarketing
      Depository,  as the case  may be,  and any  other  record  holders  of the
      Remarketing  Preferred to be redeemed.  The Corporation  shall identify by
      CUSIP number the shares of  Remarketing  Preferred to be redeemed.  To the
      extent less than all of the shares of Remarketing Preferred represented by
      a  certificate  with a particular  CUSIP  number are to be  redeemed,  the
      applicable  Depository  shall  determine  the shares  represented  by such
      certificate to be redeemed. In the case of the Securities Depository,  the
      shares to be redeemed  shall be  determined  as described in the preceding
      paragraph, and in the case of the Remarketing Depository,  the Remarketing
      Depository  shall  determine  the  number  of shares  represented  by such
      certificate to be redeemed from each Holder thereof.

             (vi) If any shares of  Preferred  Stock to be redeemed are not held
      of record by a nominee for the  Securities  Depository or the  Remarketing
      Depository,  the particular shares of Preferred Stock to be redeemed shall
      be  selected  by the  Corporation  by lot or by such  other  method as the
      Corporation shall deem fair and equitable.

             (vii)  Upon any date  fixed for  redemption  (unless  a Failure  to
      Deposit  occurs),  all rights of the Holders of shares of Preferred  Stock
      called for redemption  will cease and terminate,  except the right of such
      Holders  to receive  the  amounts  payable  in respect of such  redemption
      therefor, but without interest, and such shares of Preferred Stock will be
      deemed no longer  outstanding  and, upon the taking of any action required
      by applicable law, shall have the status of authorized and unissued shares
      of preferred  stock and may be reissued by the  Corporation at any time as
      shares of any series of preferred  stock other than as shares of Preferred
      Stock.


                                       28
<PAGE>

SECTION 5. Liquidation Preference.

      (a) In the event of any  liquidation,  dissolution  or  winding  up of the
affairs of the Corporation,  whether voluntary or involuntary,  after payment or
provision for payment of the debts and other liabilities of the Corporation, the
holders of the shares of the Preferred  Stock shall be entitled to receive,  out
of the assets of the Corporation, whether such assets are capital or surplus and
whether or not any  dividends  as such are  declared  but before any  payment or
distribution  of assets is made to holders of common stock of the Corporation or
any other class of stock or series thereof ranking junior to the Preferred Stock
with  respect  to  the  distribution  of  assets,  a  preferential   liquidation
distribution  in the amount of  $250,000  per share of  Preferred  Stock plus an
amount equal to accumulated and unpaid  dividends on each such share (whether or
not  declared)  to and  including  the  date of such  distribution  and no more.
Neither the merger or  consolidation  of the Corporation  with or into any other
corporation,  nor the merger or consolidation  of any other  corporation with or
into the Corporation,  nor the sale, lease, exchange or other transfer of all or
any  portion  of  the  assets  of  the  Corporation,  shall  be  deemed  to be a
liquidation,  dissolution or winding up of the Corporation within the meaning of
this Section 5.

      (b) If upon any  liquidation,  dissolution or winding up of the affairs of
the Corporation, whether voluntary or involuntary, the assets of the Corporation
available  for  distribution  to the  holders of  Preferred  Stock and any other
series  of  capital  stock  of the  Corporation  ranking  on a  parity  with the
Preferred  Stock are  insufficient to pay the holders of the Preferred Stock the
full  amount of the  preferential  liquidation  distributions  to which they are
entitled, then such assets of the Corporation shall be distributed ratably among
the  holders of  Preferred  Stock and any other  series of capital  stock of the
Corporation ranking on a parity with the Preferred Stock based upon the ratio of
(x) the aggregate  amount  available for distribution on all shares of Preferred
Stock and such parity stock to (y) the total amount  distributable on all shares
of Preferred Stock and such parity stock upon liquidation.

SECTION  6. Voting Rights.

      (a) Holders of the  Preferred  Stock will have no voting  rights except as
hereinafter described or as otherwise provided by the General Corporation Law of
the State of  Delaware;  provided,  however,  that the  affirmative  vote of the
holders  of record of at least 66 2/3% of the  Outstanding  shares of  Preferred
Stock,  voting  separately  as one  class,  shall  be  necessary  to  adopt  any
alteration,   amendment   or  repeal  of  any   provision  of  the  Articles  of
Incorporation   or  this   Certificate  of  Designations   (including  any  such
alteration,  amendment or repeal  effected by any merger or  consolidation),  if
such  alteration,  amendment  or  repeal  would  alter  or  change  the  powers,
preferences or special  rights of the shares of Preferred  Stock so as to affect
them adversely.

      (b)  (i) If at any  time  the  equivalent  of six or more  full  quarterly
      dividends  (whether or not  consecutive)  payable on the  Preferred  Stock
      shall be in arrears (to any extent) (a  "Default  Period"),  the number of
      directors  constituting the Board of Directors of the Corporation shall be
      increased  by two (2),  and the holders of record of the  Preferred  Stock
      shall have the exclusive right, voting as a class with any other shares of
      preferred stock of the  Corporation so entitled to vote thereon,  to elect
      the directors to fill such newly created  directorships.  This right shall
      remain vested until all  dividends in arrears on the Preferred  Stock have
      been paid or  declared  and set apart for  payment,  at which time (A) the
      right  shall  terminate  (subject  to  revesting),  (B)  the  term  of the
      directors  then in office elected in accordance  with the foregoing  shall
      terminate,  and (C) the  number  of  directors  constituting  the Board of
      Directors of the  Corporation  shall be reduced by the number of directors
      whose term has been terminated  pursuant to clause (B) above. For purposes
      of the  foregoing,  default in the payment of dividends for the equivalent
      of six quarterly  dividends

                                       29

<PAGE>


      means, in the case of Preferred Stock which pays dividends  either more or
      less frequently than every quarter, default in the payment of dividends in
      respect of one or more Dividend Periods containing not less than 540 days.

            (ii) Whenever  such right shall vest, it may be exercised  initially
      by the vote of the  holders  of  record  of a  majority  of the  shares of
      Preferred  Stock present and voting,  in person or by proxy,  at a special
      meeting of holders of record of the Preferred  Stock or at the next annual
      meeting of stockholders.  A special meeting for the exercise of such right
      shall be  called  by the  Secretary  of the  Corporation  as  promptly  as
      possible,  and in any event  within  10 days  after  receipt  of a written
      request signed by the holders of record of at least 25% of the Outstanding
      shares  of  the  Preferred  Stock,   subject  to  any  applicable   notice
      requirements  imposed  by  law.  Notwithstanding  the  provisions  of this
      paragraph,  no such special meeting shall be held during the 30-day period
      preceding  the date fixed for the annual  meeting of  stockholders  of the
      Corporation.

            (iii) So long as a Default Period continues,  any director who shall
      have been elected by holders of record of Preferred Stock entitled to vote
      in accordance  herewith  shall hold office for a term expiring at the next
      annual meeting of stockholders  and during such term may be removed at any
      time,  without cause by, and only by, the affirmative  vote of the holders
      of record of a  majority  of the shares of  Preferred  Stock  present  and
      voting,  in person or by proxy, at a special meeting of such  stockholders
      of record called for such purpose, and any vacancy created by such removal
      may also be  filled  at such  meeting.  A  meeting  for the  removal  of a
      director  elected  by the  holders  of record of  Preferred  Stock and the
      filling of the vacancy created thereby shall be called by the Secretary of
      the  Corporation  as promptly as possible  and in any event within 10 days
      after receipt of request  therefor  signed by the holders of record of not
      less than 25% of the Outstanding shares of Preferred Stock, subject to any
      applicable notice requirements  imposed by law. Such meeting shall be held
      at  the  earliest   practicable  date  thereafter.   Notwithstanding   the
      provisions  of this  paragraph,  no such meeting  shall be held during the
      30-day  period  preceding  the  date  fixed  for  the  annual  meeting  of
      stockholders of the Corporation.

            (iv) Any vacancy  caused by the death,  resignation or expiration of
      the term of office of a director who shall have been elected in accordance
      with these  provisions may be filled by the remaining  director so elected
      or, if not so filled,  by a vote of holders of record of a majority of the
      shares of Preferred Stock present and voting,  in person or by proxy, at a
      meeting called for such purpose (or, in the case of expiration of the term
      of office of such director,  at the annual meeting of  stockholders of the
      Corporation).  Unless such vacancy shall have been filled by the remaining
      director or by vote at the annual  meeting of  stockholders,  such special
      meeting  shall  be  called  by the  Secretary  of the  Corporation  at the
      earliest  practicable date after such death,  resignation or expiration of
      term of office, and in any event within 10 days after receipt of a written
      request signed by the holders of record of at least 25% of the Outstanding
      shares  of  Preferred  Stock.   Notwithstanding  the  provisions  of  this
      paragraph,  no such special meeting shall be held during the 30-day period
      preceding  the date fixed for the annual  meeting of  stockholders  of the
      Corporation.

            (v) If any meeting of the holders of the  Preferred  Stock  required
      above to be  called  shall  not have  been  called  within  10 days  after
      personal  service of a written request  therefor upon the Secretary of the
      Corporation  or within 15 days after mailing the same by  registered  mail
      addressed to the Secretary of the  Corporation  at his  principal  office,
      subject to any  applicable  notice  requirements  imposed by law, then the
      holders of record of at least 25% of the  Outstanding  shares of Preferred
      Stock may  designate in writing a holder of  Preferred  Stock to call such
      meeting at the expense of the Corporation,  and such meeting may be called
      by such person so designated  upon the notice required for annual meetings
      of  stockholders  or such  shorter  notice (but in no event


                                       30
<PAGE>


      shorter than  permitted by law) as may be  acceptable  to the holders of a
      majority of the total number of shares of Preferred  Stock.  Any holder of
      Preferred Stock so designated  shall have access to the stock books of the
      Corporation  for the purpose of causing such meeting to be called pursuant
      to  these  provisions.   Such  meeting  shall  be  held  at  the  earliest
      practicable  date  thereafter.  Notwithstanding  the  provisions  of  this
      paragraph,  no  such  meeting  shall  be held  during  the  30-day  period
      preceding  the date fixed for the annual  meeting of  stockholders  of the
      Corporation.

            (vi) At any meeting of the holders of record of the Preferred  Stock
      called in accordance with the above provisions for the election or removal
      of directors,  the presence in person or by proxy of the holders of record
      of one-third of the total number of Outstanding  shares of Preferred Stock
      shall be required to  constitute a quorum;  in the absence of a quorum,  a
      majority of the holders of record present in person or by proxy shall have
      power to adjourn the meeting from time to time without notice,  other than
      announcement at the meeting, until a quorum shall be present.


      SECTION  7. Auction Procedures.

      (a) Certain  Definitions.  Capitalized terms not defined in this Section 7
shall have the respective  meanings specified  elsewhere in this part of Article
IV(B).  As used in this Section 7, the following  terms shall have the following
meanings, unless the context otherwise requires:

            (i)  "Available  Shares of Auction  Preferred"  has the  meaning set
forth in subsection (d)(i) below.

            (ii) "Bid" has the meaning set forth in subsection (b)(i) below.

            (iii) "Bidder" has the meaning set forth in subsection (b)(i) below.

            (iv)  "Broker-Dealer  Agreement"  means  an  agreement  between  the
      Auction  Agent and a  Broker-Dealer  pursuant to which such  Broker-Dealer
      agrees to follow the procedures specified in these Auction Procedures.

            (v) "Hold  Order" has the  meaning  set forth in  subsection  (b)(i)
below.

            (vi) "Order" has the meaning set forth in subsection (b)(i) below.

            (vii)  "Potential  Holder" means any Person,  including any Existing
      Holder,  (A) who shall have executed a Purchaser's  Letter and (B) who may
      be interested in acquiring shares of Auction Preferred (or, in the case of
      an Existing Holder, additional shares of Auction Preferred).

            (viii) "Sell Order" has the meaning set forth in  subsection  (b)(i)
below.

            (ix)  "Submission  Deadline" means 1:00 P.M., New York City time, on
      any  Auction  Date,  or  such  other  time on any  Auction  Date as may be
      specified  from  time to time by the  Auction  Agent as the time  prior to
      which each  Broker-Dealer  must submit to the Auction Agent in writing all
      Orders  obtained by it for the  Auction to be  conducted  on such  Auction
      Date.

            (x) "Submitted  Bid" has the meaning set forth in subsection  (C)(i)
below.

            (xi)  "Submitted Hold Order" has the meaning set forth in subsection
(C)(i) below.

            (xii)  "Submitted  Order" has the  meaning  set forth in  subsection
(C)(i) below.


                                       31

<PAGE>


            (xiii)   "Submitted  Sell  Order"  has  the  meaning  set  forth  in
subsection (C)(i) below.

            (xiv)  "Sufficient  Clearing  Bids"  has the  meaning  set  forth in
subsection (d)(i) below.

            (xv)  "Winning  Bid Rate" has the  meaning  set forth in  subsection
(d)(i) below.

      (b)   Orders by Existing Holders and Potential Holders.

            (i) Prior to the  Submission  Deadline on each  Auction Date for any
Series of Auction Preferred:

                  (A)  each  Existing  Holder  may  submit  to  a  Broker-Dealer
information as to:

                        (1)  the  number  of   Outstanding   shares  of  Auction
                  Preferred,  if any,  held by such  Existing  Holder  that such
                  Existing  Holder desires to continue to hold without regard to
                  the Applicable Rate for the next succeeding Dividend Period;

                        (2)  the  number  of   Outstanding   shares  of  Auction
                  Preferred,  if any,  held by such  Existing  Holder  that such
                  Existing Holder desires to sell,  provided that the Applicable
                  Rate for the next succeeding  Dividend Period is less than the
                  rate per annum specified by such Existing Holder; and/or

                        (3)  the  number  of   Outstanding   shares  of  Auction
                  Preferred,  if any,  held by such  Existing  Holder  that such
                  Existing   Holder  desires  to  sell  without  regard  to  the
                  Applicable Rate for the next succeeding Dividend Period; and

                  (B) each Broker-Dealer, using a list of Potential Holders that
            shall be maintained in accordance  with the  provisions set forth in
            the  Broker-Dealer   Agreement  for  the  purpose  of  conducting  a
            competitive  Auction,   shall  contact  both  Existing  Holders  and
            Potential  Holders,  including  Existing  Holders with respect to an
            offer by any such Existing Holder to purchase  additional  shares of
            Auction Preferred,  on such list to notify such Existing Holders and
            Potential  Holders as to the length of the next Dividend  Period and
            (i) with  respect  to any Short  Dividend  Period  or Long  Dividend
            Period,  the Dividend  Payment  Date(s) and (ii) with respect to any
            Long  Dividend  Period,  any dates  before  which  shares of Auction
            Preferred may not be redeemed and any redemption  premium applicable
            in an optional redemption and to determine the number of Outstanding
            shares of Auction Preferred, if any, with respect to which each such
            Existing Holder and each Potential Holder desires to submit an Order
            and each such Potential Holder offers to purchase, provided that the
            Applicable Rate for the next succeeding Dividend Period shall not be
            less than the rate per annum specified by such Potential Holder.

      For  the  purposes  hereof,   the  communication  to  a  Broker-Dealer  of
information  referred  to in  clause  (A) or (B) of this  Subsection  (b)(i)  is
hereinafter  referred  to as an  "Order"  and  each  Existing  Holder  and  each
Potential  Holder placing an Order is hereinafter  referred to as a "Bidder;" an
Order containing the information referred to in clause (A)(1) of this Subsection
(b)(i) is  hereinafter  referred to as a "Hold Order;" an Order  containing  the
information  referred to in clause  (A)(2) or (B) of this  Subsection  (b)(i) is
hereinafter  referred  to as a "Bid;" and an Order  containing  the  information
referred to in clause (A)(3) of this Subsection  (b)(i) is hereinafter  referred
to as a "Sell Order".

            (ii) (A) A Bid by an Existing Holder shall constitute an irrevocable
offer to sell:

                                       32

<PAGE>

                        (1)  the  number  of   Outstanding   shares  of  Auction
                  Preferred  specified  in  such  Bid  if  the  Applicable  Rate
                  determined  on such  Auction  Date shall be less than the rate
                  per annum specified in such Bid; or

                        (2) such number or a lesser number of Outstanding shares
                  of  Auction  Preferred  to  be  determined  as  set  forth  in
                  Subsections  (e)(i)(D)  and  (e)(iii) if the  Applicable  Rate
                  determined on such Auction Date shall be equal to the rate per
                  annum specified therein; or

                        (3) a lesser  number of  Outstanding  shares of  Auction
                  Preferred  to  be  determined  as  set  forth  in  Subsections
                  (e)(ii)(C) and (e)(iii) if such specified rate per annum shall
                  be higher  than the  Maximum  Applicable  Rate and  Sufficient
                  Clearing Bids do not exist.

                  (B) a Sell Order by an Existing  Holder  shall  constitute  an
            irrevocable offer to sell:

                        (1)  the  number  of   Outstanding   shares  of  Auction
                  Preferred specified in such Sell Order; or

                        (2) such number or a lesser number of Outstanding shares
                  of  Auction  Preferred  to  be  determined  as  set  forth  in
                  Subsections  (e)(ii)(C)  and (e)(iii) if  Sufficient  Clearing
                  Bids do not exist.


                  (C)  a  Bid  by  a  Potential   Holder  shall   constitute  an
            irrevocable offer to purchase:

                        (1)  the  number  of   Outstanding   shares  of  Auction
                  Preferred  specified  in  such  Bid  if  the  Applicable  Rate
                  determined  on such Auction Date shall be higher than the rate
                  per annum specified in such Bid; or

                        (2) such number or a lesser number of Outstanding shares
                  of  Auction  Preferred  to  be  determined  as  set  forth  in
                  Subsections  (e)(i)(E)  and  (e)(iv)  if the  Applicable  Rate
                  determined on such Auction Date shall be equal to the rate per
                  annum specified therein.

      (c)         Submission of Orders by Broker-Dealers to Auction Agent.

            (i) Each Broker-Dealer  shall submit in writing to the Auction Agent
      prior to the  Submission  Deadline on each  Auction Date for any Series of
      Auction  Preferred all Orders  obtained by such  Broker-Dealer  specifying
      with respect to each Order:

                  (A)   the name of the Bidder placing such Order;

                  (B) the  aggregate  number of  Outstanding  shares of  Auction
            Preferred that are the subject of such Order;

                  (C) to the extent that such Bidder is an Existing Holder:

                        (1)  the  number  of   Outstanding   shares  of  Auction
                  Preferred,  if any,  subject to any Hold Order  placed by such
                  Existing Holder;

                        (2)  the  number  of   Outstanding   shares  of  Auction
                  Preferred,  if any, subject to any Bid placed by such Existing
                  Holder and the rate per annum specified in such Bid; and

                                       33

<PAGE>

                        (3)  the  number  of  Outstanding   shares  of   Auction
                  Preferred,  if any,  subject to any Sell Order  placed by such
                  Existing Holder; and

                  (D) to the extent such Bidder is a Potential Holder,  the rate
            per annum specified in such Potential Holder's Bid.

            (Each "Hold  Order",  "Bid" or "Sell  Order" as  submitted or deemed
            submitted  by  a  Broker-Dealer   being   hereinafter   referred  to
            individually  as a "Submitted  Hold Order",  a "Submitted  Bid" or a
            "Submitted  Sell  Order",  as the  case may be,  or as a  "Submitted
            Order".)

            (ii) If any rate per annum  specified in any  Submitted Bid contains
      more than three  figures to the right of the  decimal  point,  the Auction
      Agent shall round such rate up to the next highest  one-thousandth  (.001)
      of 1%.

            (iii) If one or more  Orders  covering in the  aggregate  all of the
      Outstanding shares of Auction Preferred held by an Existing Holder are not
      submitted to the Auction  Agent prior to the  Submission  Deadline for any
      reason  (including the failure of a Broker-Dealer to contact such Existing
      Holder or to submit such Existing Holder's Order or Orders), such Existing
      Holder shall be deemed to have  submitted a Hold Order covering the number
      of Outstanding  shares of Auction  Preferred held by such Existing  Holder
      that are not subject to Orders submitted to the Auction Agent.

            (iv) A Submitted  Order or  Submitted  Orders of an Existing  Holder
      that cover in the aggregate more than the number of Outstanding  shares of
      Auction Preferred held by such Existing Holder will be considered valid in
      the following order of priority:

                  (A) any Submitted  Hold Order of such Existing  Holder will be
            considered  valid up to and  including  the  number  of  Outstanding
            shares of Auction  Preferred held by such Existing Holder,  provided
            that,  if there is more than one such  Submitted  Hold Order and the
            aggregate  number of shares of  Auction  Preferred  subject  to such
            Submitted Hold Orders  exceeds the number of  Outstanding  shares of
            Auction Preferred held by such Existing Holder, the number of shares
            of Auction  Preferred  subject to each of such Submitted Hold Orders
            will be reduced pro rata so that such  Submitted  Hold Orders in the
            aggregate  will cover  exactly the number of  Outstanding  shares of
            Auction Preferred held by such Existing Holder;

                  (B)  any  Submitted  Bids  of  such  Existing  Holder  will be
            considered  valid (in the ascending order of their  respective rates
            per annum if there is more than one  Submitted  Bid of such Existing
            Holder) for the number of  Outstanding  shares of Auction  Preferred
            held by such Existing Holder equal to the difference between (i) the
            number of  Outstanding  shares  of  Auction  Preferred  held by such
            Existing Holder and (ii) the number of Outstanding shares of Auction
            Preferred  subject  to any  Submitted  Hold  Order of such  Existing
            Holder  referred to in clause  (iv)(A)  above (and, if more than one
            Submitted  Bid of such Existing  Holder  specifies the same rate per
            annum and  together  they  cover more than the  remaining  number of
            shares  of  Auction  Preferred  that  can be the  subject  of  valid
            Submitted Bids of such Existing  Holder after  application of clause
            (iv)(A) above and of the foregoing portion of this clause (iv)(B) to
            any  Submitted  Bid  or  Submitted  Bids  of  such  Existing  Holder
            specifying a lower rate or rates per annum,  the number of shares of
            Auction  Preferred subject to each of such Submitted Bids specifying
            the same  rate  per  annum  will be  reduced  pro rata so that  such
            Submitted  Bids,  in the  aggregate,  cover  exactly such  remaining
            number of Outstanding  shares of Auction  Preferred of such Existing
            Holder).

                                       34

<PAGE>

                  (C) any  Submitted  Sell Order of an  Existing  Holder will be
            considered  valid up to and  including  the  excess of the number of
            Outstanding shares of Auction Preferred held by such Existing Holder
            over  the sum of (a) the  number  of  shares  of  Auction  Preferred
            subject to Submitted Hold Orders by such Existing Holder referred to
            in  clause  (iv)(A)  above and (b) the  number of shares of  Auction
            Preferred  subject to valid  Submitted Bids by such Existing  Holder
            referred to in clause (iv)(B) above; provided that, if there is more
            than one Submitted Sell Order of such Existing Holder and the number
            of shares of Auction Preferred subject to such Submitted Sell Orders
            is  greater  than such  excess,  the  number  of  shares of  Auction
            Preferred  subject to each of such  Submitted  Sell  Orders  will be
            reduced  pro  rata  so  that  such  Submitted  Sell  Orders,  in the
            aggregate,  will  cover  exactly  the  number of  shares of  Auction
            Preferred equal to such excess.

      The number of Outstanding shares of Auction Preferred,  if any, subject to
Submitted  Bids of such  Existing  Holder not valid under clause  (iv)(B)  above
shall be treated as the subject of a Submitted Bid by a Potential  Holder at the
rate per annum specified in such Submitted Bids.

            (v) If there is more than one Submitted Bid by any Potential  Holder
      in any Auction,  each such  Submitted  Bid shall be  considered a separate
      Submitted  Bid with  respect to the rate per annum and number of shares of
      Auction Preferred specified therein.

      (d)   Determination of Sufficient Clearing Bids, Winning Bid Rate and
      Applicable Rate.

            (i) Not earlier  than the  Submission  Deadline on each Auction Date
      for any Series of Auction Preferred,  the Auction Agent shall assemble all
      Orders submitted or deemed submitted to it by the Broker-Dealers and shall
      determine:

                  (A) the excess of the total  number of  Outstanding  shares of
            Auction  Preferred  over the number of shares of  Auction  Preferred
            that are the subject of  Submitted  Hold Orders  (such  excess being
            hereinafter   referred  to  as  the  "Available  Shares  of  Auction
            Preferred");

                  (B)  from  the  Submitted   Orders,   whether  the  number  of
            Outstanding  shares of  Auction  Preferred  that are the  subject of
            Submitted Bids by Potential Holders specifying one or more rates per
            annum equal to or lower than the Maximum  Applicable Rate exceeds or
            is equal to the sum of:

                       (1) the number of Outstanding shares of Auction Preferred
                  that are the subject of  Submitted  Bids by  Existing  Holders
                  specifying one or more rates per annum higher than the Maximum
                  Applicable Rate, and

                       (2) the number of Outstanding shares of Auction Preferred
                  that are subject to Submitted Sell Orders.

                  (if such excess or such  equality  exists  (other than because
                  the  number of  Outstanding  shares of  Auction  Preferred  in
                  clauses  (1) and (2) above are each  zero  because  all of the
                  Outstanding  shares of Auction  Preferred  are the  subject of
                  Submitted Hold Orders), there shall exist "Sufficient Clearing
                  Bids" and such  Submitted  Bids by Potential  Holders shall be
                  hereinafter  referred to collectively as "Sufficient  Clearing
                  Bids"); and

                  (C) if Sufficient  Clearing  Bids exist,  the winning bid rate
            (the  "Winning Bid Rate"),  which shall be the lowest rate per annum
            specified in the Submitted Bids that if:


                                       35
<PAGE>

                       (1) each  Submitted Bid from Existing Holders  specifying
                  the  Winning  Bid  Rate  and all  other  Submitted  Bids  from
                  Existing  Holders   specifying  lower  rates  per  annum
                  were  accepted,   thus  entitling  such  Existing  Holders  to
                  continue to hold the shares of Auction  Preferred that are the
                  subject of such Submitted Bids, and

                       (2) each Submitted Bid from Potential Holders  specifying
                  the  Winning  Bid  Rate  and all  other  submitted  Bids  from
                  Potential  Holders  specifying  lower  rates  per  annum  were
                  accepted,  thus entitling  such Potential  Holders to purchase
                  the shares of Auction  Preferred  that are the subject of such
                  Submitted  Bids,   would  result  in  such  Existing   Holders
                  described in subclause (C)(1)  continuing to hold an aggregate
                  number of Outstanding  shares of Auction  Preferred that, when
                  added to the number of Outstanding shares of Auction Preferred
                  to  be  purchased  by  such  Potential  Holders  described  in
                  subclause  (C)(2),   would  equal  or  exceed  the  number  of
                  Available Shares of Auction Preferred.

            (ii) In connection  with any Auction and promptly  after the Auction
      Agent has made the  determinations  pursuant  to  Subsection  (d)(i),  the
      Auction Agent shall advise the Corporation of the Maximum  Applicable Rate
      and,  based  on such  determinations,  the  Applicable  Rate  for the next
      succeeding Dividend Period as follows:

                  (A) if  Sufficient  Clearing Bids exist,  that the  Applicable
            Rate for the next  succeeding  Dividend Period shall be equal to the
            Winning Bid Rate;

                  (B) if  Sufficient  Clearing  Bids do not  exist  (other  than
            because all of the Outstanding  shares of Auction  Preferred are the
            subject of Submitted Hold Orders), that the next succeeding Dividend
            Period will be a Standard  Dividend  Period and the Applicable  Rate
            for the next succeeding Dividend Period determined shall be equal to
            the  Maximum   Applicable  Rate  for  a  Standard   Dividend  Period
            determined on the Business Day  immediately  preceding such Auction;
            or

                  (C) if all of the Outstanding  shares of Auction Preferred are
            the subject of Submitted Hold Orders,  that the Applicable  Rate for
            the next  succeeding  Dividend  Period  shall be equal to 58% of the
            Applicable  "AA"  Composite  Commercial  Paper Rate,  in the case of
            Auction Preferred with a Dividend Period of 7 to 48 days, a Standard
            Dividend  Period or a Short Dividend Period of 183 days or less, 58%
            of the  Applicable  Treasury  Bill  Rate  in  the  case  of  Auction
            Preferred with a Short Dividend Period of 184 to 364 days, or 58% of
            the Applicable  Treasury Note Rate, in the case of Auction Preferred
            with a Long Dividend Period, in effect on the Auction Date.

      (e)  Acceptance  and Rejection of Submitted Bids and Submitted Sell Orders
and Allocation of Shares of Auction Preferred.  Based on the determinations made
pursuant to  Subsection  (d)(i),  the Submitted  Bids and Submitted  Sell Orders
shall be accepted or rejected and the Auction Agent shall take such other action
as set forth below:

            (i) If  Sufficient  Clearing  Bids have been  made,  subject  to the
      provisions  of  Subsections  (e)(iii)  and  (e)(iv),  Submitted  Bids  and
      Submitted Sell Orders shall be accepted or rejected in the following order
      of priority and all other Submitted Bids shall be rejected:

                  (A) the  Submitted  Sell Orders of Existing  Holders  shall be
            accepted  and the  Submitted  Bid of each  of the  Existing  Holders
            specifying  any rate per annum that is higher  than the


                                       36
<PAGE>

            Winning  Bid Rate  shall  be  rejected,  thus  requiring  each  such
            Existing Holder to sell the Outstanding  shares of Auction Preferred
            that are the subject of such Submitted Sell Order or Submitted Bid;

                  (B)  the  Submitted  Bid  of  each  of  the  Existing  Holders
            specifying  any rate per annum  that is lower than the  Winning  Bid
            Rate shall be accepted,  thus entitling each such Existing Holder to
            continue to hold the  Outstanding  shares of Auction  Preferred that
            are the subject of such Submitted Bid;

                  (C)  the  Submitted  Bid  of  each  of the  Potential  Holders
            specifying  any rate per annum  that is lower than the  Winning  Bid
            Rate shall be accepted;

                  (D)  the  Submitted  Bid  of  each  of  the  Existing  Holders
            specifying  a rate per annum that is equal to the  Winning  Bid Rate
            shall be  accepted,  thus  entitling  each such  Existing  Holder to
            continue to hold the  Outstanding  shares of Auction  Preferred that
            are  the  subject  of such  Submitted  Bid,  unless  the  number  of
            Outstanding   shares  of  Auction  Preferred  subject  to  all  such
            Submitted  Bids  shall be  greater  than the  number of  Outstanding
            shares  of   Auction   Preferred   ("Remaining   Shares  of  Auction
            Preferred")  equal to the excess of the Available  Shares of Auction
            Preferred over the number of Outstanding shares of Auction Preferred
            subject to Submitted  Bids  described in  Subsections  (e)(i)(B) and
            (e)(i)(C),  in which event the Submitted  Bids of each such Existing
            Holder shall be  rejected,  and each such  Existing  Holder shall be
            required to sell Outstanding shares of Auction  Preferred,  but only
            in an  amount  equal to the  difference  between  (1) the  number of
            Outstanding  shares of Auction  Preferred then held by such Existing
            Holder subject to such Submitted Bid and (2) the number of shares of
            Auction  Preferred   obtained  by  multiplying  (x)  the  number  of
            Remaining  Shares  of  Auction  Preferred  by  (y) a  fraction,  the
            numerator  of which  shall be the  number of  Outstanding  shares of
            Auction  Preferred  held by such  Existing  Holder  subject  to such
            Submitted  Bid and the  denominator  of which shall be the aggregate
            number of Outstanding  shares of Auction  Preferred  subject to such
            Submitted  Bids made by all such Existing  Holders that  specified a
            rate per annum equal to the Winning Bid Rate; and

                  (E)  the  Submitted  Bid  of  each  of the  Potential  Holders
            specifying  a rate per annum that is equal to the  Winning  Bid Rate
            shall be  accepted,  but only in an  amount  equal to the  number of
            Outstanding  shares of Auction Preferred obtained by multiplying (x)
            the difference between the Available Shares of Auction Preferred and
            the number of  Outstanding  shares of Auction  Preferred  subject to
            Submitted  Bids described in  Subsections  (e)(i)(B),  (e)(i)(C) and
            (e)(i)(D)  by (y) a fraction,  the  numerator  of which shall be the
            number of Outstanding  shares of Auction  Preferred  subject to such
            Submitted Bid and the  denominator  of which shall be the sum of the
            number of Outstanding  shares of Auction  Preferred  subject to such
            Submitted  Bids made by all such  Potential  Holders that  specified
            rates per annum equal to the Winning Bid Rate.

            (ii) If  Sufficient  Clearing  Bids have not been made  (other  than
      because all of the Outstanding  shares of Auction Preferred are subject to
      Submitted Hold Orders),  subject to the provisions of Subsection (e)(iii),
      Submitted Orders shall be accepted or rejected as follows in the following
      order of priority and all other Submitted Bids of Potential  Holders shall
      be rejected:

                  (A) the Submitted Bid of each Existing  Holder  specifying any
            rate per annum that is equal to or lower than the Maximum Applicable
            Rate shall be  accepted,  thus  entitling  such

                                       37
<PAGE>

            Existing  Holder  to  continue  to hold the  Outstanding  shares  of
            Auction Preferred that are the subject of such Submitted Bid;

                  (B) the Submitted Bid of each Potential Holder  specifying any
            rate per annum that is equal to or lower than the Maximum Applicable
            Rate shall be accepted,  thus  requiring  such  Potential  Holder to
            purchase the  Outstanding  shares of Auction  Preferred that are the
            subject of such Submitted Bid; and

                  (C) the Submitted Bids of each Existing Holder  specifying any
            rate per annum that is higher than the Maximum Applicable Rate shall
            be rejected,  thus requiring  each such Existing  Holder to sell the
            Outstanding shares of Auction Preferred that are the subject of such
            Submitted Bid, and the Submitted Sell Orders of each Existing Holder
            shall be  accepted,  in both  cases  only in an amount  equal to the
            difference  between (1) the number of Outstanding  shares of Auction
            Preferred  then  held  by  such  Existing  Holder  subject  to  such
            Submitted  Bid or Submitted  Sell Order and (2) the number of shares
            of Auction  Preferred  obtained by  multiplying  (x) the  difference
            between the Available Shares of Auction  Preferred and the aggregate
            number  of  Outstanding  shares  of  Auction  Preferred  subject  to
            Submitted Bids described in Subsections (e)(ii)(A) and (e)(ii)(B) by
            (y) a  fraction,  the  numerator  of which  shall be the  number  of
            Outstanding shares of Auction Preferred held by such Existing Holder
            subject  to such  Submitted  Bid or  Submitted  Sell  Order  and the
            denominator  of which shall be the aggregate  number of  Outstanding
            shares of Auction  Preferred  subject to all such Submitted Bids and
            Submitted Sell Orders

            (iii) If, as a result of the  procedures  described  in  Subsections
      (e)(i) or (e)(ii),  any  Existing  Holder would be entitled or required to
      sell or any Potential Holder would be entitled or required to purchase,  a
      fraction of a share of Auction  Preferred on any Auction Date, the Auction
      Agent shall, in such manner as in its sole discretion it shall  determine,
      round up or down the number of shares of Auction Preferred to be purchased
      or sold by any Existing Holder or Potential Holder on such Auction Date so
      that only whole shares of Auction  Preferred  will be entitled or required
      to be sold or purchased.

            (iv) If,  as a result  of the  procedures  described  in  Subsection
      (e)(i),  any  Potential  Holder  would be entitled or required to purchase
      less than a whole  share of Auction  Preferred  on any Auction  Date,  the
      Auction  Agent shall,  in such manner as in its sole  discretion  it shall
      determine,  allocate  shares  of  Auction  Preferred  for  purchase  among
      Potential  Holders so that only  whole  shares of  Auction  Preferred  are
      purchased  on such  Auction  Date by any  Potential  Holder,  even if such
      allocation results in one or more of such Potential Holders not purchasing
      any shares of Auction Preferred on such Auction Date.

            (v) Based on the results of each  Auction,  the Auction  Agent shall
      determine,  with respect to each Broker-Dealer that submitted Bids or Sell
      Orders on behalf of Existing Holders or Potential  Holders,  the aggregate
      number of Outstanding  shares of Auction Preferred to be purchased and the
      aggregate number of Outstanding  shares of Auction Preferred to be sold by
      such Potential  Holders and Existing  Holders and, to the extent that such
      aggregate  number  of  Outstanding  shares  of  Auction  Preferred  to  be
      purchased  and such  aggregate  number of  Outstanding  shares of  Auction
      Preferred to be sold differ,  the Auction  Agent shall  determine to which
      other  Broker-Dealer or  Broker-Dealers  acting for one or more purchasers
      such  Broker-Dealer  shall deliver,  or from which other  Broker-Dealer or
      Broker-Dealers  acting for one or more  sellers such  Broker-Dealer  shall
      receive, as the case may be, Outstanding shares of Auction Preferred.

                                       38
<PAGE>


SECTION 8. Auction Agent.

      The  Corporation  shall use its best  efforts to  maintain,  pursuant to a
written agreement (the "Auction Agent Agreement"), an Auction Agent with respect
to each Series of Auction  Preferred,  to act in accordance  with the provisions
set forth herein with respect to such Series.

SECTION 9. Remarketing Procedures.

      (a)  Determination  of Dividend Periods and Dividend Rates for Remarketing
MAPS.  Subject to Section 3 hereof,  the  duration of each  subsequent  Dividend
Period and the dividend rate for each subsequent Dividend Period with respect to
any share of Remarketing  Preferred  will be established by a Remarketing  Agent
and will be  conclusive  and binding on the  Corporation  and the Holder of such
share of Remarketing  Preferred.  Each Remarketing Agent will establish dividend
rates,  not in excess of the Maximum  Applicable  Rate, for each Dividend Period
which  it  determines  will be the  lowest  rate at  which  tendered  Shares  of
Remarketing Preferred would be remarketed at $250,000 per share. In establishing
each Dividend  Period and dividend rate, each  Remarketing  Agent will establish
Dividend  Periods and dividend rates which it determines will result in the most
favorable  financing  alternative for the Corporation  based on the then-current
Marketing Conditions.

      (b) Remarketing; Tender for Remarketing. The following procedures shall be
applicable to each share of Remarketing Preferred:

            (i) The Remarketing Agent. Each Remarketing Agent shall use its best
      efforts,  on behalf of the  Holders  thereof,  to  remarket  all shares of
      Remarketing  Preferred  tendered for sale by  Remarketing  for which it is
      acting  as  Remarketing  Agent  without  charge  to such  Holder,  only at
      $250,000  per share,  provided  that no such  Remarketing  Agent  shall be
      obligated  to  remarket  such  Remarketing  Preferred  if there shall be a
      material  misstatement or omission in any disclosure  document provided by
      the  Corporation  and  used in  connection  with the  Remarketing  of such
      Remarketing  Preferred  or at any time such  Remarketing  Agent shall have
      determined that it is not advisable to remarket  Remarketing  Preferred by
      reason of: (i) a pending or proposed change in applicable tax laws, (ii) a
      material  adverse  change in the financial  condition of the  Corporation,
      (iii) a banking  moratorium,  (iv) domestic or international  hostilities,
      (v) an amendment of the provisions  hereof which  materially and adversely
      changes  the  nature  of  the  shares  of  Remarketing  Preferred  or  the
      Remarketing Procedures or (vi) a Failure to Deposit. Any Remarketing Agent
      may,  but  shall  not  be  obligated  to,  purchase  tendered  Remarketing
      Preferred for its own account.  Should the Remarketing Agent for any share
      of  Remarketing  Preferred not succeed in  Remarketing  all such shares of
      Remarketing  Preferred  so  tendered  for  Remarketing  on any date,  such
      Remarketing Agent shall select the shares of such Remarketing Preferred to
      be sold from those  tendered pro rata.  Payments in the amount of $250,000
      per share of Remarketing  Preferred remarketed shall be made by the Tender
      Agent by crediting  such  payments to the accounts of the Holders  thereof
      maintained  by the Tender  Agent or, to the extent duly  requested  of the
      Tender  Agent  by  Holders,  by  wire or  other  transfer  in  immediately
      available  funds to their  accounts  with  commercial  banks in the United
      States.  If for  any  reason  a  share  of  Remarketing  Preferred  is not
      remarketed  on the date of  tender,  such share  will be  retained  by its
      Holder.  Until remarketed,  each such share of Remarketing  Preferred will
      have  successive  Dividend  Periods  of one day and  will be  entitled  to
      dividends,  payable  on  each  succeeding  Business  Day  at  the  Maximum
      Applicable Rate.


            (ii) Notice of Shares of Remarketing Preferred to be Retained.  Each
      share of  Remarketing  Preferred  will be deemed to have been tendered for
      sale by  Remarketing on the last day of each Dividend  Period,  unless the
      Holder thereof gives irrevocable notice to the contrary to the

                                      39

<PAGE>

      Remarketing  Agent  for  such  share  of  Remarketing  Preferred  or if so
      instructed by such  Remarketing  Agent, to the Tender Agent.  Such notice,
      which may be telephonic or written, must be delivered, prior to 3:00 P.M.,
      New York City time, on the Business Day immediately preceding the last day
      of a Dividend Period or on the earlier day specified in a notice,  if any,
      mailed by the Tender Agent at the direction of such  Remarketing  Agent to
      such record  holder at its address as the same  appears on the Stock Books
      of the  Corporation,  which  day  will be a  Business  Day at  least  four
      Business  Days after the  mailing  of such  notice.  The notice  from such
      Holder of an  election to retain  shares of  Remarketing  Preferred  shall
      state:

                  (A) the number of shares of such Remarketing Preferred held by
            the Securities Depository or the Remarketing Depository, and

                  (B) the number of such shares of Remarketing  Preferred  which
            shall be deemed not to have been so tendered.

            (iii)  Shares  Deemed to Have Been  Tendered.  The  failure  to give
      notice of an election  to retain any shares of  Remarketing  Preferred  as
      provided in (b)(ii) above will constitute the irrevocable  tender for sale
      by  Remarketing  of such  shares of  Remarketing  Preferred.  Certificates
      representing shares of Remarketing  Preferred remarketed will be issued to
      the Securities Depository or the Remarketing  Depository,  as the case may
      be,  irrespective of whether the certificates  formerly  representing such
      shares of Remarketing Preferred have been delivered to the Tender Agent. A
      Holder  which has not  given  notice  that it will  retain  its  shares of
      Remarketing  Preferred  shall have no further  rights with respect to such
      shares of  Remarketing  Preferred  upon the  Remarketing of such shares of
      Remarketing Preferred, except the right to receive any declared but unpaid
      dividends thereon and the proceeds of the Remarketing of such shares.

            (iv) Funds for Purchase of Shares.  Payments to Holders of shares of
      Remarketing  Preferred  remarketed  will be made solely from the  proceeds
      received from the purchasers of such shares in a Remarketing.  Neither the
      Corporation, the Tender Agent nor any Remarketing Agent shall be obligated
      to provide  funds to make payment to the holders of shares of  Remarketing
      Preferred tendered for Remarketing.

                                       40

<PAGE>


            (c)  The  Remarketing  Process.  The  Remarketing  process  will  be
      conducted on the following schedule and in the following manner (all times
      are New York City time):

<TABLE>
<CAPTION>
  The Last Business Day of a Dividend Period:*
               Beginning Not Later Than

<S>                                                      <C>
      1:00 P.M ........................................  The  Remarketing  Agent  for the  shares of  Remarketing
                                                         Preferred  will   determine  and,  upon  request,   make
                                                         available   to  all   interested   persons   non-binding
                                                         indications  of  Dividend  Periods  and  dividend  rates
                                                         based  upon  then  current  Marketing  Conditions.  Each
                                                         Holder  may  obtain  a  binding  commitment  as  to  the
                                                         specific  Dividend  Period or  Dividend  Periods and the
                                                         related  Applicable Rate or Applicable  Rates which will
                                                         be  applicable  to  such  Holder's  shares  should  such
                                                         Holder elect to retain them.

      At 3:00 P.M .....................................  Holders  of  shares  of  Remarketing Preferred  will  be
                                                         deemed to have tendered shares of Remarketing  Preferred
                                                         for sale by  Remarketing  at $250,000  per share  unless
                                                         they   have   given   contrary   instructions   to   the
                                                         Remarketing   Agent  for  such  shares  of   Remarketing
                                                         Preferred  or,  if so  instructed  by  such  Remarketing
                                                         Agent, to the Tender Agent.

      After 3:00 P.M ..................................  The  applicable   Remarketing  Agent  will  solicit  and
                                                         receive  orders from  prospective  investors to purchase
                                                         tendered shares of Remarketing  Preferred.  A purchaser,
                                                         at the  time of its  agreement  to  purchase  shares  of
                                                         Remarketing  Preferred,  may obtain a binding commitment
                                                         as to the specific  Dividend Period or Dividend  Periods
                                                         and the related  Applicable Rate or Applicable Rates for
                                                         such  shares  of   Remarketing   Preferred   based  upon
                                                         then-current Marketing Conditions.
<FN>
--------
* Or such other time and day as may have been  specified in a notice mailed
to the holders of Remarketing Preferred.
</FN>
</TABLE>

                                       41
<PAGE>

<PAGE>


<TABLE>
<CAPTION>

      First Business Day of Next Dividend Period:

<S>                                                      <C>
      Opening of Business                                The  applicable   Remarketing Agent  will  continue,  if
                                                         necessary,  remarketing shares of Remarketing  Preferred
                                                         as described above.

      By 1:00 P.M .....................................  The  applicable  Remarketing  Agent  will have  completed
                                                         Remarketing  and will advise the Tender  Agent as to the
                                                         Applicable Rate and Dividend  Period  applicable to each
                                                         share of  Remarketing  Preferred  commencing  a Dividend
                                                         Period on that day and of any failure to remarket.

      By 2:30 P.M .....................................  New  Holders   must   deliver  the   purchase  price  as
                                                         instructed by the applicable  Remarketing Agent.  Former
                                                         Holders will be paid the proceeds of the  Remarketing of
                                                         their  shares by the Tender  Agent  (upon  surrender  of
                                                         their certificates, if applicable).
</TABLE>

SECTION 10. The Remarketing Agent.

      The Corporation will take all reasonable  action necessary so that, at all
times,  at least one  investment  bank,  broker,  dealer  or other  organization
qualified to remarket shares of Remarketing  Preferred and to establish Dividend
Periods and Applicable  Rates is acting as  Remarketing  Agent for each share of
Remarketing Preferred.

SECTION 11. Book Entry System.

      (a) Shares of Preferred  Stock with  Dividend  Periods of 7 days or longer
shall be represented by a global  certificate or certificates  registered in the
name of a nominee of the Securities Depository, as depository for such shares of
Preferred Stock.  Shares of Remarketing  Preferred with Dividend Periods of less
than 7 days  shall  be  represented  by a  global  certificate  or  certificates
registered in the name of a nominee of the Remarketing Depository, as depository
for such shares of Remarketing Preferred.

      (b) All of the  Outstanding  shares of Auction  Preferred  of each  Series
shall be represented by a single  certificate for each Series  registered in the
name of the nominee of the Securities  Depository  unless otherwise  required by
law or  unless  there is no  Securities  Depository.  If there is no  Securities
Depository,  shares of Auction  Preferred shall be registered in the Stock Books
in the name of the Existing  Holder thereof and such Existing  Holder  thereupon
will be entitled to receive a certificate  therefor and be required to deliver a
certificate therefor upon transfer or exchange thereof.

      (c)  Each  Series  of  Remarketing  Preferred  shall be  represented  by a
separate  global  security  or  global  securities  and  shares  of  Remarketing
Preferred having different  Dividend Payment Dates,  dividend rates,  redemption
provisions or  Percentages,  if any, shall be  represented by a separate  global
security.

      (d)  Interests  in  shares  of  Preferred  Stock  represented  by a global
security will be shown on, and transfers  thereof will be effected only through,
records maintained by the respective depository.

                                       42

<PAGE>

      (e) If the Securities  Depository  should resign and the  Corporation  not
select a substitute  securities  depository,  physical  delivery of certificates
shall be made in the names of designated  transferees in exchange for the global
security or securities held for the account of the Securities Depository.

SECTION 12. Miscellaneous.

      (a) So long as the dividend  rate is based on the results of an Auction or
Remarketing,  a Holder (i) may sell,  transfer or otherwise dispose of shares of
Auction  Preferred  only pursuant to a Bid or Sell Order in accordance  with the
Auction  Procedures  or to or through a  Broker-Dealer  or to a Person  that has
delivered a signed copy of a Purchaser's  Letter to a Broker-Dealer,  and in the
case of all transfers  other than pursuant to Auctions,  such Existing Holder of
the shares of Auction  Preferred,  its Broker-Dealer or its Participant  advises
the Auction  Agent of such  transfer,  (ii) may transfer  shares of  Remarketing
Preferred  only  pursuant to a tender of such shares to the Tender Agent or to a
person that has delivered a signed copy of a Purchaser's Letter to a Remarketing
Agent, and in the case of all transfers of shares of Remarketing Preferred other
than  pursuant  to a  tender  of  such  shares,  the  holder  of the  shares  so
transferred  advises a  Remarketing  Agent of such  transfer  and  (iii)  unless
otherwise required by law, shall have its ownership of shares of Preferred Stock
maintained in book entry form by the  Securities  Depository  or, in the case of
shares of Remarketing  Preferred with a Dividend Period of less than 7 days, the
Remarketing Depository.

      (b)  Each  Remarketing  Agent  will  be  required  to  register  on a list
maintained  pursuant  to  a  Remarketing  Agreement  a  transfer  of  shares  of
Remarketing  Preferred  for which it is the  Remarketing  Agent from a holder to
another  person only if such  transfer is made to a person that has  delivered a
signed copy of a Purchaser's  Letter to such  Remarketing  Agent and if (i) such
transfer is pursuant to a Remarketing  or (ii) such  Remarketing  Agent has been
notified  in writing  (A) by such  holder of such  transfer or (B) by any person
that  purchased  or sold such  Remarketing  Preferred  in a  Remarketing  of the
failure of such  Remarketing  Preferred to be delivered or paid for, as the case
may be, in connection with such Remarketing. A Remarketing Agent is not required
to register a transfer of Remarketing Preferred pursuant to clause (ii) above on
or prior to the Business Day immediately preceding the first day of a subsequent
Dividend Period for such  Remarketing  Preferred  unless it receives the written
notice  required by such clause  (ii) by 3:00 P.M.,  New York City time,  on the
second Business Day preceding the first day of such subsequent  Dividend Period.
Such  Remarketing  Agent will  rescind a transfer  registered  on such list as a
result of a Remarketing if the  Remarketing  Agent is notified in writing of the
failure  of shares  of  Remarketing  Preferred  to be  delivered  or paid for as
required.  Any transfer of shares of Remarketing  Preferred made in violation of
the terms of a Purchaser's  Letter may affect the right of the Person  acquiring
such shares to participate in Remarketings.

      (c) (i) If the Method of determining  the Dividend Rate for some or all of
      the Series of Preferred  Stock is the Auction  Method,  the Corporation or
      any Affiliate of the  Corporation may not submit for its own account a Bid
      or Hold Order in an Auction.  If the  Corporation  or any Affiliate  holds
      shares of Auction  Preferred  for its own  account,  it must submit a Sell
      Order in the next auction with respect to such shares.  Any  Broker-Dealer
      that is an Affiliate of the Corporation may not submit for its own account
      Bid Orders or Hold Orders in Auctions.  If such  affiliated  Broker-Dealer
      holds shares of Auction  Preferred  for its own account,  it must submit a
      Sell Order in the next  Auction  with  respect  to such  shares of Auction
      Preferred.

         (ii) The  Corporation or any Affiliate of the  Corporation may acquire,
      hold or  dispose  of  shares of  Remarketing  Preferred.  Subject  to such
      limitations as the Corporation and the Remarketing Agent may agree, it and
      its Affiliates will purchase shares of Remarketing Preferred,

                                       43
<PAGE>

      if any,  during  Remarketings  only after 3:00 P.M.  on the  Business  Day
      immediately preceding the first day of each subsequent Dividend Period and
      only at  Applicable  Rates and for  Dividend  Periods  established  by the
      Remarketing Agents without regard to such offers by the Corporation or its
      Affiliates and will tender shares of Remarketing Preferred for Remarketing
      only  upon at least 10  days'  prior  notice  to the  Remarketing  Agents;
      provided,  however,  that if the then current Dividend Period is less than
      10 days, the Corporation will give notice to the Remarketing  Agent on the
      day such Dividend Period of less than 10 days commences. In the event that
      the Corporation or its Affiliates purchase shares of Remarketing Preferred
      for  their  respective  accounts,  all  shares  of  Remarketing  Preferred
      tendered by other holders,  including any such Remarketing Preferred owned
      by a Remarketing  Agent,  will be remarketed before the Remarketing of any
      such Remarketing Preferred owned by the Corporation or its Affiliates.  If
      any shares of Remarketing Preferred tendered for Remarketing are not sold,
      any  shares of  Remarketing  Preferred  tendered  for  Remarketing  by the
      Corporation or an Affiliate of the  Corporation,  up to the number of such
      shares not so sold, will be deemed not to have been so tendered.

      (d) The  purchase  price of each share of  Preferred  Stock  which is sold
either through the Auction  Procedures or the  Remarketing  Procedures  shall be
$250,000.

      (e) If a holder of Converted  Auction  Preferred fails to give irrevocable
notice otherwise to the Remarketing Agent for such Remarketing Preferred (or, if
so instructed by such  Remarketing  Agent, to the Tender Agent) by no later than
3:00 P.M.,  New York City time,  on the Business Day  immediately  preceding the
first day of the subsequent  Dividend Period applicable  thereto,  or such other
day as is  specified  in a notice  delivered  in the manner set forth in Section
9(b)(ii),  such holder will be deemed to have  tendered such  Converted  Auction
Preferred for sale by Remarketing on such Business Day.

      (f) An  Auction  will be held in  respect  of  each  Series  of  Converted
Remarketing  Preferred  on the Initial  Auction  Date.  If a holder of Converted
Remarketing Preferred does not submit an Order in such Auction, such holder will
be deemed to have submitted a Sell Order in such Auction.

SECTION 13. Exclusive Remedy.

      In the event  that  dividends  are not  timely  declared  on the shares of
Preferred Stock,  the exclusive remedy of Holders against the Corporation  shall
be as set forth in this part of Article IV (B) and in no event shall  Holders of
such  shares  have  a  specifically  enforceable  right  to the  declaration  of
dividends.

SECTION 14. Additional Terms.

      (a) The Board of Directors may  interpret  the  provisions of this part of
Article IV (B) to resolve any  inconsistency  or  ambiguity or remedy any formal
defect.

      (b) The  headings of the various  subdivisions  of this part of Article IV
(B)  are  for   convenience   of  reference   only  and  shall  not  affect  the
interpretation of any of the provisions hereof.


                                   ----------

      (C) Except as  otherwise  provided by the General  Corporation  Law of the
State of Delaware or by any  resolution  heretofore or hereafter  adopted by the
Board of Directors  fixing the relative  powers,  preferences and rights and the
qualifications,   limitations  or  restrictions  of  any  additional  series  of
Preferred  Stock,  the entire  voting power of the shares of the Company for the
election of directors  and for all other  purposes,  as well as all other rights
appertaining to shares of the Company, shall be vested


                                       44
<PAGE>



exclusively in the Common Stock.  Each share of Common Stock shall have one vote
upon all matters to be voted on by the holders of the Common Stock, and shall be
entitled to  participate  equally in all  dividends  payable with respect to the
Common Stock and to share ratably,  subject to the rights and preferences of any
Preferred  Stock,  in all assets of the Company in the event of any voluntary or
involuntary  liquidation,  dissolution  or  winding  up of  the  affairs  of the
Company, or upon any distribution of the assets of the Company.

      (D) The Company shall not, without either the prior approval of a majority
of the total number of shares then issued and  outstanding  and entitled to vote
or the  receipt by the  Company of a favorable  opinion  issued by a  nationally
recognized  investment  banking  firm  designated  by the  Committee  of  Equity
Security Holders of Texaco Inc. appointed in the Company's jointly  administered
Chapter 11 case in the United States  Bankruptcy Court for the Southern District
of New  York or its last  chairman  (or his  designee)  to the  effect  that the
proposed  issuance is fair from a finance point of view to the  stockholders  of
the Company issue to its  stockholders  generally (i) any warrant or other right
to purchase  any  security of the Company,  any  successor  thereto or any other
person or entity or (ii) any security of the Company  containing  any such right
to purchase,  which warrant, right or security (a) is exercisable,  exchangeable
or  convertible,  based or  conditioned  in whole or in part on (I) a change  of
control of the Company or (II) the owning or holding of any number or percentage
of  outstanding  shares or voting  power or any offer to  acquire  any number of
shares or  percentage  of voting  power by any  entity,  individual  or group of
entities and/or individuals or (b) discriminates among holders of the same class
of  securities  (or the class of  securities  for which such warrant or right is
exercisable or exchangeable) of the Company or any successor thereto.


                                       V.

      The Company is to have perpetual existence.

                                       VI.

      The  private  property  of the  stockholders  is not to be  subject to the
payment of corporate debts to any extent whatever.

                                      VII.

      No holder of stock of the  Company  shall have any  preferential  right of
subscription  to any share of any class of stock of the Company  issued or sold,
or to any  obligations  convertible  into stock of the Company,  or any right of
subscription  to any thereof  other than such, if any, as the Board of Directors
in its discretion  may  determine,  and at such prices as the Board of Directors
may fix.

                                      VIII.

      The  Company may use its surplus  earnings or  accumulated  profits in the
purchase or  acquisition of its own capital stock from time to time as its Board
of Directors  shall  determine,  and such capital stock so purchased may, if the
directors  so  determine,  be held in the  treasury  of the  Company as treasury
stock,  to be thereafter  disposed of in such manner as the directors shall deem
proper.

                                       45

<PAGE>

                                       IX.

      (A) Number, Election and Terms of Directors.  Except as otherwise fixed by
or pursuant to the provisions of Article IV hereof relating to the rights of the
holders of any class or series of stock having  preference over the Common Stock
as to  dividends  or  upon  liquidation  to  elect  additional  directors  under
specified  circumstances,  the number of the  directors of the Company  shall be
fixed from time to time by or pursuant to the by-laws. The directors, other than
those who may be elected by the holders of any class or series of stock having a
preference over the Common Stock as to dividends or upon  liquidation,  shall be
classified,  with respect to the time for which they severally hold office, into
three  classes,  as nearly equal in number as possible,  as shall be provided in
the manner  specified in the by-laws,  one class to be originally  elected for a
term expiring at the annual meeting of stockholders to be held in 1985,  another
class to be  originally  elected for a term  expiring  at the annual  meeting of
stockholders to be held in 1986, and another class to be originally  elected for
a term expiring at the annual meeting of  stockholders  to be held in 1987, with
each class to hold office until its successor is elected and qualified.  At each
annual meeting of the  stockholders of the Company,  the successors of the class
of directors  whose term expires at that meeting shall be elected to hold office
for a term expiring at the annual meeting of stockholders held in the third year
following the year of their election.

      (B)  Stockholder  Nomination  of Director  Candidates.  Advance  notice of
stockholder  nominations  for the  election of  directors  shall be given in the
manner provided in the by-laws.

      (C)  Newly  Created  Directorships  and  Vacancies.  Except  as  otherwise
provided  for or fixed by or  pursuant  to the  provisions  of Article IV hereof
relating to the rights of the  holders of any class or series of stock  having a
preference  over the Common Stock as to dividends or upon  liquidation  to elect
directors under specified  circumstances,  newly created directorships resulting
from any increase in the number of directors  and any  vacancies on the Board of
Directors resulting from death, resignation or disqualification,  or other cause
shall be filled by the affirmative vote of a majority of the remaining directors
then in office,  even though less than a quorum of the Board of  Directors.  Any
director so elected  shall stand for  election  (for the balance of his term) at
the next annual meeting of stockholders,  unless his term expires at such annual
meeting.  Any  vacancy  on the Board of  Directors  resulting  from  removal  by
stockholder  vote shall be filled  only by the vote of a majority  of the voting
power of all shares of the Company entitled to vote generally in the election of
directors, voting together as a single class.

      (D) Removal.  Subject to the rights of any class or series of stock having
a preference over the Common Stock as to dividends or upon  liquidation to elect
directors  under  specified  circumstances,  any  director  may be removed  from
office, with or without cause, only by the affirmative vote of the holders of 66
2/3% of the  combined  voting  power of the  then  outstanding  shares  of stock
entitled to vote  generally in the election of directors,  voting  together as a
single class.

      (E) Amendment,  Repeal,  Etc.  Notwithstanding  anything contained in this
Certificate  of  Incorporation  to the  contrary,  the  affirmative  vote of the
holders  of at least 66 2/3% of the voting  power of all  shares of the  Company
entitled to vote  generally in the election of directors,  voting  together as a
single  class,   shall  be  required  to  alter,   amend,  adopt  any  provision
inconsistent with or repeal this Article IX.

                                       46

<PAGE>



                                       X.

      In furtherance,  and not in limitation of the powers conferred by statute,
the Board of Directors is expressly authorized:

      (A) to fix in the by-laws from time to time the number of directors of the
Company, none of whom need be stockholders;

      (B) to fix the amount to be reserved as working capital over and above its
capital stock paid in;

      (C) to  borrow  money  and to make and  issue  notes,  bonds,  debentures,
obligations  and  evidence  of  indebtedness  of all kinds,  with or without the
privilege of  conversion  into stock of the Company;  and also to authorize  and
cause to be executed  mortgages and liens upon the real and personal property of
the Company and conveyances of its real estate;

      (D) from time to time to determine whether and to what extent, and at what
times and places,  and under what conditions and  regulations,  the accounts and
books of the Company  (other than the stock  ledger),  or any of them,  shall be
open to inspection of stockholders;  and no stockholder  shall have any right of
inspecting  any account  book or document of the Company  except as conferred by
statute, unless authorized by a resolution of the stockholders or directors; and

      (E) if the by-laws so provide, to designate by resolution three or more of
its number to constitute an executive committee,  which committee shall, for the
time being,  have and  exercise  such of the powers of the Board of Directors in
the  management  of the business  and affairs of the Company,  and have power to
authorize  the seal of the Company to be affixed to all papers which may require
it.

      The  Company  may in its  by-laws  confer  powers  upon its  directors  in
addition  to  the  foregoing  and in  addition  to the  powers  and  authorities
expressly conferred upon them by statute.

      Both  stockholders  and  directors  shall have  power,  if the  by-laws so
provide, to hold their meeting and to have one or more offices within or without
the State of  Delaware,  and to keep the books of the  Company  (subject  to the
provisions of applicable laws),  outside of the State of Delaware at such places
as may be from time to time designated by the Board of Directors.

                                       XI.

      Any action  required or permitted to be taken by the  stockholders  of the
Company  must be  effected at a duly  called  annual or special  meeting of such
holders  and may not be  effected  by any  consent in  writing by such  holders.
Except as otherwise  required by law and subject to the rights of the holders of
any class or series of stock  having a  preference  over the Common  Stock as to
dividends or upon  liquidation,  special meetings of stockholders of the Company
may be called only by the Board of Directors  pursuant to a resolution  approved
by a  majority  of the  entire  Board  of  Directors.  Notwithstanding  anything
contained in this Certificate of Incorporation to the contrary,  the affirmative
vote of the holders of at least 66 2/3% of the voting power of all shares of the
Company entitled to vote generally in the election of directors, voting together
as a single  class,  shall be  required  to alter,  amend,  adopt any  provision
inconsistent with or repeal this Article XI.

                                       47

<PAGE>

                                      XII.

      The Board of Directors shall have power to make,  alter,  amend and repeal
the by-laws  (except so far as the  by-laws  adopted by the  stockholders  shall
otherwise provide). Any by-laws made by the directors under the powers conferred
hereby  may  be  altered,  amended  or  repealed  by  the  directors  or by  the
stockholders.  Notwithstanding  the  foregoing  and  anything  contained in this
Certificate  of  Incorporation  to the  contrary,  Section  2 of  Article  I and
Sections 1,2,3 and 4 of Article II of the by-laws shall not be altered,  amended
or repealed and no provision inconsistent therewith shall be adopted without the
affirmative  vote of the holders of at least 66 2/3% of the voting  power of all
the  shares  of the  Company  entitled  to vote  generally  in the  election  of
directors, voting together as a single class. Notwithstanding anything contained
in this Certificate of  Incorporation  to the contrary,  the affirmative vote of
the holders of at least 66 2/3% of the voting power of all shares of the Company
entitled to vote  generally in the election of directors,  voting  together as a
single  class,   shall  be  required  to  alter,   amend,  adopt  any  provision
inconsistent with or repeal this Article XII.

                                      XIII.

      (A)   Vote Required for Certain Business Combinations.

            (1) Higher Vote for Certain  Business  Combinations.  In addition to
      any affirmative vote required by law or this Certificate of Incorporation,
      and except as  otherwise  expressly  provided in Section B of this Article
      XIII:

                  (a)  any  merger  or  consolidation  of  the  Company  or  any
            Subsidiary  (as   hereinafter   defined)  with  (i)  any  Interested
            Stockholder  (as  hereinafter  defined)  or (ii) any  other  Company
            (whether or not itself an Interested Stockholder) which is, or after
            such merger or consolidation  would be, an Affiliate (as hereinafter
            defined) of an Interested Stockholder; or

                  (b) any sale, lease, exchange,  mortgage,  pledge, transfer or
            other  disposition (in one transaction or a series of  transactions)
            to or  with  any  Interested  Stockholder  or any  Affiliate  of any
            Interested   Stockholder  of  any  assets  of  the  Company  or  any
            Subsidiary  having an aggregate Fair Market Value of $100 million or
            more; or

                  (c) the issuance or transfer by the Company or any  Subsidiary
            (in one transaction or a series of  transactions)  of any securities
            of the Company or any  Subsidiary to any  Interested  Stockholder or
            any Affiliate of any  Interested  Stockholder  in exchange for cash,
            securities or other  property (or a combination  thereof)  having an
            aggregate Fair Market Value of $100 million or more or;

                  (d) the adoption of any plan or proposal  for the  liquidation
            or  dissolution  of  the  Company  proposed  by or on  behalf  of an
            Interested   Stockholder   or  any   Affiliate  of  any   Interested
            Stockholder; or

                  (e) any reclassification of securities  (including any reverse
            stock split), or  recapitalization  of the Company, or any merger or
            consolidation  of the Company  with any of its  Subsidiaries  or any
            other  transaction  (whether  or  not  with  or  into  or  otherwise
            involving an Interested  Stockholder) which has the effect, directly
            or  indirectly,   of  increasing  the  proportionate  share  of  the
            outstanding shares of any class of equity or convertible  securities
            of the Company or any  Subsidiary  which is  directly or  indirectly
            owned  by  any  Interested

                                       48
<PAGE>

            Stockholder  or any Affiliate of any Interested  Stockholder;  shall
            require the  affirmative  vote of the holders of at least 80% of the
            voting power of the then outstanding  shares of capital stock of the
            Company entitled to vote generally in the election of directors (the
            "Voting  Stock"),  voting  together  as a  single  class  (it  being
            understood that for purposes of this Article XIII, each share of the
            Voting  Stock shall have the number of votes  granted to it pursuant
            to  Article  IV  of  this   Certificate  of   Incorporation).   Such
            affirmative vote shall be required  notwithstanding the fact that no
            vote may be required,  or that a lesser percentage may be specified,
            by law or in any agreement with any national  securities exchange or
            otherwise.

            (2)  Definition  of  "Business   Combination."  The  term  "Business
      Combination" as used in this Article XIII shall mean any transaction which
      is referred to in any one or more of clauses (a) through (e) of  paragraph
      (1) of this Section (A).

      (B) When Higher Vote is Not Required.  The provisions of Section A of this
Article XIII shall not be applicable to any particular Business Combination, and
such  Business  Combination  shall  require  only  such  affirmative  vote as is
required by law and any other provision of this Certificate of Incorporation, if
all of the  conditions  specified in either of the following  paragraphs (1) and
(2) are met:

            (1) Approval by Disinterested  Directors.  The Business  Combination
      shall have been approved by a majority of the Disinterested  Directors (as
      hereinafter defined).

            (2)   Price  and  Procedure  Requirements.   All  of  the  following
      conditions shall have been met:

                  (a) The aggregate amount of the cash and the Fair Market Value
            (as hereinafter  defined) as of the date of the  consummation of the
            Business Combination of consideration other than cash to be received
            per share by holders of Common  Stock in such  Business  Combination
            shall be at least equal to the higher of the following:

                        (i)(if   applicable)   the   highest   per  share  price
                  (including  any  brokerage  commissions,  transfer  taxes  and
                  soliciting  dealers' fees) paid by the Interested  Stockholder
                  for any shares of Common  Stock  acquired by it (a) within the
                  two-year  period  immediately  prior to the first  publication
                  announcement of the proposal of the Business  Combination (the
                  "Announcement  Date")  or (b) in the  transaction  in which it
                  became an Interested Stockholder, whichever is higher; and

                        (ii) the Fair Market  Value per share of Common Stock on
                  the  Announcement  Date or on the date on which the Interested
                  Stockholder became an Interested Stockholder (such latter date
                  is  referred  to in this  Article  XIII as the  "Determination
                  Date"), whichever is higher.

                  (b) The aggregate amount of the cash and the Fair Market Value
            as of the date of the  consummation  of the Business  Combination of
            consideration other than cash to be received per share by holders of
            shares of any other class of  outstanding  Voting  Stock shall be at
            least equal to the highest of the following (it being  intended that
            the  requirements of this paragraph 2(b) shall be required to be met
            with respect to every class of outstanding Voting Stock,  whether or
            not the Interested Stockholder has previously acquired any shares of
            a particular class of Voting Stock):

                                       49

<PAGE>

                        (i)(if   applicable)   the   highest   per  share  price
                  (including  any  brokerage  commissions,  transfer  taxes  and
                  soliciting  dealers' fees) paid by the Interested  Stockholder
                  for any shares of such class of Voting  Stock  acquired  by it
                  (a)  within  the  two-year  period  immediately  prior  to the
                  Announcement Date or (b) in the transaction in which it became
                  an Interested Stockholder, whichever is higher;

                        (ii) (if applicable) the highest preferential amount per
                  share to which the  holders  of shares of such class of Voting
                  Stock  are   entitled  in  the  event  of  any   voluntary  or
                  involuntary  liquidation,  dissolution  or  winding  up of the
                  Company; and

                        (iii) the Fair  Market  Value per share of such class of
                  Voting Stock on the Announcement  Date or on the Determination
                  Date, whichever is higher.

                  (c)  The   consideration  to  be  received  by  holders  of  a
            particular  class of  outstanding  Voting  Stock  (including  Common
            Stock)  shall  be in cash  or in the  same  form  as the  Interested
            Stockholder  has previously  paid for shares of such class of Voting
            Stock.  If the  Interested  Stockholder  has paid for  shares of any
            class of Voting Stock with varying forms of consideration,  the form
            of consideration for such class of Voting Stock shall be either cash
            or the form used to  acquire  the  largest  number of shares of such
            class  of  Voting  Stock  previously   acquired  by  it.  The  price
            determined  in  accordance  with  paragraph  2(a)  and  2(b) of this
            Section B shall be subject to appropriate adjustment in the event of
            any stock  dividend,  stock split,  combination of shares or similar
            event.

                  (d) After such Interested Stockholder has become an Interested
            Stockholder   and  prior  to  the   consummation  of  such  Business
            Combination:   (i)  except  as   approved   by  a  majority  of  the
            Disinterested Directors, there shall have been no failure to declare
            and pay at the regular date  therefor any full  quarterly  dividends
            (whether or not cumulative) on the outstanding Preferred Stock; (ii)
            there  shall  have  been  (A) no  reduction  in the  annual  rate of
            dividends  paid on the Common Stock  (except as necessary to reflect
            any  subdivision  of the  Common  Stock),  except as  approved  by a
            majority of the Disinterested Directors, and (B) an increase in such
            annual   rate   of   dividends   as   necessary   to   reflect   any
            reclassification    (including    any    reverse    stock    split),
            recapitalization,  reorganization  or any similar  transaction which
            has the effect of reducing the number of  outstanding  shares of the
            Common Stock  unless the failure so to increase  such annual rate is
            approved by a majority  of the  Disinterested  Directors;  and (iii)
            such  Interested  Stockholder  shall have not become the  beneficial
            owner of any additional shares of Voting Stock except as part of the
            transaction which results in such Interested Stockholder becoming an
            Interested Stockholder.

                  (e) After such Interested Stockholder has become an Interested
            Stockholder, such Interested Stockholder shall not have received the
            benefit,   directly  or  indirectly  (except  proportionately  as  a
            stockholder), of any loans, advances,  guarantees,  pledges or other
            financial  assistance  or any tax  credits  or other tax  advantages
            provided by the Company, whether in anticipation of or in connection
            with such Business Combination or otherwise.

                  (f) A proxy or information  statement  describing the proposed
            Business  Combination  and complying  with the  requirements  of the
            Securities  Exchange  Act of 1934  and  the  rules  and  regulations
            thereunder (or any subsequent  provisions  replacing such Act, rules
            or  regulations)  shall be  mailed  to  public  stockholders  of the
            Company at least 30 days prior to

                                       50
<PAGE>

            the consummation of such Business  Combination  (whether or not such
            proxy or information  statement is required to be mailed pursuant to
            such Act or subsequent provisions).

      (C) Vote Required for Certain Stock Repurchases.  In addition to any other
requirement of this  Certificate of  Incorporation,  the affirmative vote of the
holders  of  at  least  50%  of  the  Voting  Stock  (other  than  Voting  Stock
beneficially owned by a Selling Stockholder (as hereinafter defined)),  shall be
required before the Company purchases any outstanding  shares of Common Stock at
a price above the Market Price (as  hereinafter  defined) from a person actually
known by the Company to be a Selling Stockholder, unless the purchase is made by
the Company (i) on the same terms and as a result of an offer made  generally to
all holders of Common Stock or (ii) pursuant to statutory appraisal right.

      (D) Certain Definitions. For the purposes of this Article XIII:

            (1) A "person" shall mean any individual, firm, corporation or other
      entity.

            (2) "Interested  Stockholder"  shall mean any person (other than the
      Company or any Subsidiary) who or which:

                  (a) is the beneficial owner,  directly or indirectly,  of more
            than 20% of the voting power of the outstanding Voting Stock; or

                  (b) is an  Affiliate of the Company and at any time within the
            two-year  period  immediately  prior to the date in question was the
            beneficial  owner,  directly  or  indirectly,  of 20% or more of the
            voting power of the then outstanding Voting Stock; or

                  (c) is an assignee of or has otherwise succeeded to any shares
            of Voting  Stock which were at any time within the  two-year  period
            immediately prior to the date in question  beneficially owned by any
            Interested Stockholder,  if such assignment or succession shall have
            occurred in the course of a  transaction  or series of  transactions
            not involving a public offering within the meaning of the Securities
            Act of 1933.

            (3) A person shall be a "beneficial owner" of any Voting Stock:

                  (a) which such person or any of its  Affiliates  or Associates
            (as hereinafter  defined)  beneficially owns directly or indirectly;
            or

                  (b) which such person or any of its  Affiliates  or Associates
            has (i) the right to  acquire  (whether  such  right is  exercisable
            immediately  or only  after the  passage of time),  pursuant  to any
            agreement,  arrangement  or  understanding  or upon the  exercise of
            conversion  rights,   exchange  rights,   warrants  or  options,  or
            otherwise,  or (ii) the  right to vote  pursuant  to any  agreement,
            arrangement or understanding; or

                  (c) which are beneficially owned,  directly or indirectly,  by
            any other person with which such person or any of its  Affiliates or
            Associates has any agreement,  arrangement or understanding  for the
            purpose of acquiring,  holding, voting or disposing of any shares of
            Voting Stock.

            (4)  For  the  purposes  of  determining  whether  a  person  is  an
      Interested  Stockholder  pursuant to  paragraph  2 of this  Section C, the
      number of shares of Voting Stock deemed to be  outstanding  shall  include
      shares deemed owned through  application  of paragraph 3 of this Section C
      but shall

                                       51
<PAGE>

      not  include  any other  shares  which  may be  issuable  pursuant  to any
      agreement,  arrangement or  understanding,  or upon exercise of conversion
      rights, warrants or options, or otherwise.

            (5)  "Affiliate" or "Associate"  shall have the respective  meanings
      ascribed to such terms in Rule 12b-2 of the General Rules and  Regulations
      under the Securities Exchange Act of 1934, as in effect on March 1, 1984.

            (6)  "Subsidiary"  means any  corporation of which a majority of any
      class of equity security is owned, directly or indirectly, by the Company;
      provided,  however,  that for the purposes of the definition of Interested
      Stockholder  set  forth  in  paragraph  2 of  this  Section  C,  the  term
      "Subsidiary"  shall mean only a  corporation  of which a majority  of each
      class of equity security is owned, directly or indirectly, by the Company.

            (7)  "Disinterested  Director"  means  any  member  of the  Board of
      Directors who is  unaffiliated  with the Interested  Stockholder and was a
      member of the  Board of  Directors  prior to the time that the  Interested
      Stockholder  became an  Interested  Stockholder,  and any  successor  of a
      Disinterested Director who is unaffiliated with the Interested Stockholder
      and is  recommended to succeed a  Disinterested  Director by a majority of
      Disinterested Directors then on the Board of Directors.

            (8) "Fair Market  Value"  means:  (a) in the case of the stock,  the
      highest closing sale price during the 30-day period immediately  preceding
      the date in  question of a share of such stock on the  Composite  Tape for
      New York Stock Exchange-Listed  Stocks, or, if such stock is not listed on
      such  Exchange,   on  the  principal  United  States  securities  exchange
      registered  under the Securities  Exchange Act of 1934 on which such stock
      is  listed,  or, if such  stock is not  listed on any such  exchange,  the
      highest closing bid quotation with respect to a share of such stock during
      the  30-day  period  preceding  the  date  in  question  on  the  National
      Association of Securities Dealers, Inc. Automated Quotations System or any
      system  then in use,  or if no such  quotations  are  available,  the fair
      market  value  on the  date in  question  of a  share  of  such  stock  as
      determined by the Board of Directors in good faith; and (b) in the case of
      property other than cash or stock,  the fair market value of such property
      on the date in question as  determined  by the Board of  Directors in good
      faith.

            (9)  "Selling  Stockholder"  means  any  person  who or which is the
      beneficial  owner  of in the  aggregate  more  than 1% of the  outstanding
      shares  of  Common  Stock  and who or which  has  purchased  or  agreed to
      purchase any of such shares within the most recent two-year period and who
      sells or proposes  to sell Common  Stock in a  transaction  requiring  the
      affirmative vote provided for in Section C of this Article XIII.

            (10)  "Market  Price"  means the highest sale price on or during the
      period of five trading days immediately  preceding the date in question of
      a  share  of  such  stock  on  the  Composite  Tape  for  New  York  Stock
      Exchange-Listed  Stocks,  or if such stock is not quoted on the  Composite
      Tape on the New York  Stock  Exchange,  or, if such stock is not listed on
      such  Exchange,   on  the  principal  United  States  securities  exchange
      registered  under the Securities  Exchange Act of 1934 on which such stock
      is  listed,  or, if such  stock is not  listed on any such  exchange,  the
      highest  closing  bid  quotation  with  respect  to a share of stock on or
      during the period of five trading days  immediately  preceding the date in
      question on the National Association of Securities Dealers, Inc. Automated
      Quotations  System or any system then in use, or if no such quotations are
      available,  the fair  market  value on the date in  question of a share of
      such stock as determined by a majority of the Disinterested Directors.


                                       52
<PAGE>

      (E) Powers of the Board of Directors.  A majority of the  directors  shall
have the power and duty to determine  for the purposes of this Article  XIII, on
the basis of information known to them after reasonable  inquiry,  (1) whether a
person is an  Interested  Stockholder,  (2) the number of shares of Voting Stock
beneficially  owned by any  person,  (3)  whether  a person is an  Affiliate  or
Associate  of  another,  (4)  whether  the assets  which are the  subject of any
Business  Combination have, or the consideration to be received for the issuance
or  transfer of  securities  by the Company or any  Subsidiary  in any  Business
Combination  has, an  aggregate  Fair Market  Value of $100  million or more.  A
majority of the  directors  shall have the further power to interpret all of the
terms and provisions of this Article XIII.

      (F) No Effect on Fiduciary Obligations of Interested Stockholders. Nothing
contained in this  Article  XIII shall be  construed  to relieve any  Interested
Stockholder from any fiduciary obligation imposed by law.

      (G) Amendment,  Repeal, etc.  Notwithstanding any other provisions of this
Certificate of Incorporation or the by-laws (and notwithstanding the fact that a
lesser  percentage may be specified by law, this Certificate of Incorporation or
the  by-laws)  the  affirmative  vote  of the  holders  of 80%  or  more  of the
outstanding  Voting Stock,  voting together as a single class, shall be required
to amend or repeal, or adopt any provisions inconsistent with this Article XIII.

                                      XIV.

      A  director  of the  Company  shall not be liable  to the  Company  or its
stockholders  for monetary  damages for breach of fiduciary  duty as a director,
except to the extent such exemption from liability or limitation  thereof is not
permitted under the Delaware  General  Corporation Law as the same exists or may
hereafter be amended.

      Any repeal or modification of the foregoing  paragraph by the stockholders
of the Company shall not adversely  affect any right or protection of a director
of the Company existing at the time of such repeal or modification.

                                       53

<PAGE>



                                       XV.

      The  Company  reserves  the right to amend,  alter,  change or repeal  any
provision  contained in this Certificate of Incorporation,  in the manner now or
hereafter  prescribed by this Certificate of  Incorporation or statute,  and all
rights  conferred  upon   stockholders   herein  are  granted  subject  to  this
reservation.







                                       54