EXHIBIT 3.1B



                          CERTIFICATE OF DESIGNATION OF

                            RIGHTS AND PREFERENCES OF

                           SERIES C PREFERRED STOCK OF

                             ALLION HEALTHCARE, INC.


                            (UNDER SECTION 151 OF THE

                        DELAWARE GENERAL CORPORATION LAW)

Allion Healthcare, Inc., a corporation organized and existing under the laws of
the State of Delaware (the "Corporation"), hereby certifies that the following
resolution was adopted by the Board of Directors of the Corporation:

RESOLVED, that pursuant to the authority expressly granted to and vested in the
Board of Directors of the Corporation (the "Board of Directors") by the
provisions of the Amended and Restated Certificate of Incorporation (the
"Certificate of Incorporation"), there is hereby created, out of the 20,000,000
shares of Preferred Stock, par value $.001 per share, of the Corporation
authorized in the Certificate of Incorporation (the "Preferred Stock"), a series
of Preferred Stock consisting of 2,000,000 shares, which series shall have the
following designation, powers, preferences and relative, participating, optional
or other rights, and the following qualifications, limitations and restrictions
(in addition to any powers, preferences and relative, participating, optional or
other rights, and the following qualifications, limitations and restrictions,
set forth in the Certificate of Incorporation):

1. DESIGNATION; NUMBER OF SHARES. 2,000,000 shares of Preferred Stock shall be
designated the "Series C Preferred Stock" (the "Series C Preferred Stock").

2. RANKING. All of the preferential amounts to be paid to the holders of the
Series C Preferred Stock as provided in this Certificate of Designation shall be
paid or set apart for payment (i) on a PARI PASSU basis with the Series A
Preferred Stock, par value $.001 per share of the Corporation (the "Series A
Preferred Stock") and the Series B Preferred Stock, par value $.001 per share of
the Corporation (the "Series B Preferred Stock") and (ii) before the payment or
setting apart for payment of any amount for, or the distribution of any property
of the Corporation to, the holders of any class or series of Common Stock (as
defined below) or other class or series of capital stock of the Corporation
other than the Series A Preferred Stock and Series B Preferred Stock, whether
now or hereafter authorized, ranking junior as to liquidation rights to the
Series C Preferred Stock.

3. DIVIDENDS. In the event any dividends are declared with respect to the common
stock, par value $.001 per share, of the Corporation (the "Common Stock"), or
upon the Series A Preferred Stock, Series B Preferred Stock, or any class or
Series of Preferred Stock which is designated for PARI PASSU dividend treatment,
the holders of the Series C Preferred Stock as of the record date established by
the Board of Directors for such dividend shall be entitled to receive as
dividends (the "Dividends") an amount (whether in the form of cash, securities
or other property) equal to the amount (and in the form) of the dividends that
such holder would have received had the Series C Preferred Stock been converted
into Common Stock as of the date immediately prior to the record date of such
dividend, or, in the case of dividends on Series A Preferred Stock, Series B





<PAGE>

Preferred Stock or other PARI PASSU series or class of Preferred Stock, an
amount per share equal to any dividends declared thereon, in each case such
Dividends to be payable on the payment date of the dividend established by the
Board of Directors (the "Dividend Payment Date"). The record date for any such
Dividends shall be the record date for the applicable dividend, and any such
Dividends shall be payable to the persons in whose name the Series C Preferred
Stock is registered at the close of business on the applicable record date.

4. LIQUIDATION DISSOLUTION OR WINDING UP. The Series A Preferred Stock, Series B
Preferred Stock and Series C Preferred Stock respective liquidation preferences
shall rank PARI PASSU in connection with any liquidation, dissolution or winding
up of the Corporation. In the event of any liquidation, dissolution or winding
up of the Corporation, whether voluntary or involuntary, before any distribution
may be made with respect to the Common Stock or any other series of capital
stock of the Corporation ranking junior as to liquidation rights to the Series A
Preferred Stock, Series B Preferred Stock or Series C Preferred Stock, the
holders of each share of (i) Series A Preferred Stock shall be entitled to be
paid out of the assets of the Corporation available for distribution to holders
of the Corporation's capital stock of all classes, whether such assets are
capital, surplus or capital earnings, on a PARI PASSU basis with the shares of
Series B Preferred Stock and Series C Preferred Stock and as a liquidation
preference an amount equal to $2.00 per share on the Series A Preferred Stock
(as adjusted for stock splits, stock dividends and the like) plus all declared
and unpaid dividends thereon, if any, since the date of issue up to and
including the date full payment shall be tendered to the holders of the Series A
Preferred Stock with respect to such liquidation, dissolution or winding up,
(ii) Series B Preferred Stock shall be entitled to be paid out of the assets of
the Corporation available for distribution to holders of the Corporation's
capital stock of all classes, whether such assets are capital, surplus or
capital earnings, on a PARI PASSU basis with the shares of Series A Preferred
Stock and Series C Preferred Stock and as a liquidation preference an amount
equal to $3.00 per share on the Series B Preferred Stock (as adjusted for stock
splits, stock dividends and the like) plus all declared and unpaid dividends
thereon, if any, since the date of issue up to and including the date full
payment shall be tendered to the holders of the Series B Preferred Stock with
respect to such liquidation, dissolution or winding up and (iii) Series C
Preferred Stock shall be entitled to be paid out of the assets of the
Corporation available for distribution to holders of the Corporation's capital
stock of all classes, whether such assets are capital, surplus or capital
earnings, on a PARI PASSU basis with the shares of Series A Preferred Stock and
Series B Preferred Stock, and as a liquidation preference, an amount equal to
$10.00 per share on the Series C Preferred Stock (as adjusted for stock splits,
stock dividends and the like) plus all declared and unpaid dividends thereon, if
any, since the date of issue up to and including the date full payment shall be
tendered to the holders of the Series C Preferred Stock with respect to such
liquidation, dissolution or winding up (the "Series C Liquidation Preference").
If, upon any liquidation, dissolution or winding up of the Corporation, the
amounts payable with respect to the Series C Preferred Stock are not paid in
full, the holders of the Series C Preferred Stock shall share ratably in any
distribution of assets in proportion to the full respective preferential amounts
to which they are otherwise entitled to receive.



                                      -2-
<PAGE>


After payment in full of the respective liquidation preferences for the Series A
Preferred Stock, Series B Preferred Stock and the Series C Liquidation
Preference, in each case as set forth in the preceding paragraph, the assets of
the Corporation legally available for distribution to its stockholders, if any,
shall be distributed ratably to the holders of the Common Stock of the
Corporation and Series C Preferred Stock, on an as-if-converted to Common Stock
basis, and the holders of Series A Preferred Stock and Series B Preferred Stock
shall be entitled to no further participation in the distribution of assets of
the Corporation with respect to the shares of Series A Preferred Stock and
Series B Preferred Stock held thereby.

5. CONVERSION. The holders of the Series C Preferred Stock shall have the
following conversion rights:

     (a)  VOLUNTARY CONVERSION. Each holder of shares of Series C Preferred
          Stock may elect at any time to convert the shares of Series C
          Preferred Stock then held by such holder into a number of shares of
          Common Stock computed by multiplying the number of shares of Series C
          Preferred Stock to be converted by their applicable Conversion Value
          (as defined below) and dividing the result by the applicable
          conversion price for the Series C Preferred Stock (the "Series C
          Conversion Price") then in effect. The "Conversion Value" of the
          Series C Preferred Stock shall be $5.00 per share. The Series C
          Conversion Price shall initially be $5.00 per share and shall be
          subject to adjustment as hereinafter provided. The conversion rate for
          each share of Series C Preferred Stock shall initially be one-to-one.
          If a holder of Series C Preferred Stock elects to convert Series C
          Preferred Stock at a time when there are any declared and unpaid
          dividends or other amounts due on such shares, such dividends and
          other amounts shall be paid in full by the Corporation in connection
          with such conversion.

     (b)  AUTOMATIC CONVERSION. Each share of Series C Preferred Stock
          outstanding shall automatically be converted into the number of shares
          of Common Stock into which such shares are convertible as computed
          according to the formula set forth in Section 5(a) hereof at the then
          effective applicable Series C Conversion Price upon the earlier of:

          (i)  the date specified by the holders of at least two-thirds of
               shares of Series C Preferred Stock then outstanding, or

          (ii) immediately prior to the closing of an underwritten public
               offering of shares of the Corporation's Common Stock pursuant to
               an effective registration statement under the Securities Act of
               1933, as amended, in which the price per share is at least $10.00
               per share and which results in gross proceeds to the Corporation
               of at least $30,000,000 (a "Qualified Public Offering").

     (c)  PROCEDURE FOR VOLUNTARY CONVERSION. Upon election to convert pursuant
          to Sections 5(a) or 5(b)(i), the relevant holder or holders of Series
          C Preferred Stock shall surrender the certificate or certificates
          representing the Series C Preferred Stock being converted, duly
          assigned or endorsed for transfer to the Corporation (or accompanied




                                      -3-
<PAGE>

          by duly executed stock powers relating thereto), at the principal
          executive office of the Corporation or the offices of the transfer
          agent for the Series C Preferred Stock or such office or offices in
          the continental United States of an agent for conversion, in each case
          as is from time to time designated by notice to the holders of the
          Series C Preferred Stock by the Corporation, or in the event the
          certificate or certificates are lost, stolen or missing, shall deliver
          an affidavit or agreement satisfactory to the Corporation to indemnify
          the Corporation from any loss incurred by it in connection therewith
          (an "Affidavit of Loss") with respect to such certificates. The
          issuance by the Corporation of Common Stock upon a conversion of
          Series C Preferred Stock upon election to convert pursuant to Sections
          5(a) or 5(b)(i) hereof shall be effective as of the surrender of the
          certificate or certificates for the Series C Preferred Stock to be
          converted, duly assigned or endorsed for transfer to the Corporation
          (or accompanied by duly executed stock powers relating thereto), or as
          of the delivery of an Affidavit of Loss. Upon surrender of a
          certificate representing Series C Preferred Stock for conversion, or
          delivery of an Affidavit of Loss, the Corporation shall issue and send
          by hand delivery, by courier or by first class mail (postage prepaid)
          to the holder thereof or to such holder's designee, at the address
          designated by such holder, certificates for the number of shares of
          Common Stock to which such holder shall be entitled upon conversion
          plus a cash payment in the amount of any declared but unpaid dividends
          payable in respect of the shares of Series C Preferred Stock which are
          converted. Notwithstanding the foregoing, in the event of an automatic
          conversion pursuant to Section 5(b)(i) the outstanding shares of such
          applicable Series C Preferred Stock shall be converted automatically
          without any further action by the holders of such shares and whether
          or not the certificates representing such shares are surrendered to
          the Corporation or its transfer agent and all rights with respect to
          such applicable Series C Preferred Stock shall terminate, except any
          of the rights of the holders thereof upon surrender of their
          certificate or certificates therefor or delivery of an Affidavit of
          Loss thereof to receive certificates for the number of shares of
          Common Stock into which such shares of Series C Preferred Stock has
          been converted plus all declared but unpaid dividends payable in
          respect of the shares of Series C Preferred Stock which are converted.
          The issuance of certificates for Common Stock upon conversion of
          Series C Preferred Stock will be made without charge to the holders of
          such shares for any issuance tax in respect thereof or other costs
          incurred by the Corporation in connection with such conversion and the
          related issuance of such stock.

     (d)  PROCEDURE FOR AUTOMATIC CONVERSION ON QUALIFIED PUBLIC OFFERING. As
          of, and in all cases subject to, the closing of a Qualified Public
          Offering (the "Automatic Conversion Date"), all outstanding shares of
          Series C Preferred Stock shall be converted automatically into shares
          of Common Stock as set forth in Section 5(b)(ii) hereof and without
          any further action by the holders of such shares and whether or not
          the certificates representing such shares of Series C Preferred Stock
          are surrendered to the Corporation or its transfer agent. On the
          Automatic Conversion Date, all rights with respect to the Series C
          Preferred Stock so converted shall terminate, except any of the rights
          of the holders thereof upon surrender of their certificate or
          certificates therefor or delivery of an Affidavit of Loss thereof to
          receive certificates for the number of shares of Common Stock into
          which such Series C Preferred Stock has been converted plus all
          declared but unpaid dividends payable in respect of the Shares of
          Series C Preferred Stock which are converted. If so required by the
          Corporation, certificates surrendered for conversion shall be endorsed




                                      -4-
<PAGE>

          or accompanied by a written instrument or instruments of transfer, in
          form satisfactory to the Corporation, duly executed by the registered
          holder or by his, her or its attorney duly authorized in writing. Upon
          surrender of such certificates or Affidavit of Loss the Corporation
          shall issue and deliver to such holder, promptly at such office and in
          its name as shown on such surrendered certificate or certificates, a
          certificate or certificates for the number of shares of Common Stock
          into which the shares of the Series C Preferred Stock surrendered are
          convertible on the Automatic Conversion Date and shall pay all
          declared but unpaid dividends payable in respect of the shares of
          Series C Preferred Stock which are converted. The issuance of
          certificates for Common Stock upon conversion of Series C Preferred
          Stock will be made without charge to the holders of such shares for
          any issuance tax in respect thereof or other costs incurred by the
          Corporation in connection with such conversion and the related
          issuance of such stock.

     (e)  FRACTIONAL SHARES. The Corporation shall not be obligated to deliver
          to holders of Series C Preferred Stock any fractional share of Common
          Stock issuable upon any conversion of such Series C Preferred Stock,
          but in lieu thereof may make a cash payment in respect thereof in any
          manner permitted by law.

     (f)  RESERVATION OF COMMON STOCK. The Corporation shall at all times
          reserve and keep available out of its authorized and unissued Common
          Stock, solely for issuance upon the conversion of Series C Preferred
          Stock as herein provided, free from any preemptive rights or other
          obligations, such number of shares of Common Stock as shall from time
          to time be issuable upon the conversion of all the Series C Preferred
          Stock then outstanding provided that the shares of Common Stock so
          reserved shall not be reduced or affected in any manner whatsoever so
          long as any shares of Series C Preferred Stock are outstanding. The
          Corporation shall prepare and shall use its best efforts to obtain and
          keep in force such governmental or regulatory permits or other
          authorizations as may be required by law, and shall comply with all
          requirements as to registration, qualification or listing of the
          Common Stock, in order to enable the Corporation lawfully to issue and
          deliver to each holder of record of Series C Preferred Stock such
          number of shares of its Common Stock as shall from time to time be
          sufficient to effect the conversion of all Series C Preferred Stock
          then outstanding and convertible into shares of Common Stock.

     (g)  ADJUSTMENTS TO SERIES C CONVERSION PRICE. The Series C Conversion
          Price in effect from time to time shall be subject to adjustment as
          follows:

          (i)  STOCK DIVIDENDS, SUBDIVISIONS AND COMBINATIONS. Upon the issuance
               of additional shares of Common Stock as a dividend or other
               distribution on outstanding Common Stock, the subdivision of
               outstanding shares of Common Stock into a greater number of
               shares of Common Stock, or the combination of outstanding shares
               of Common Stock into a smaller number of shares of the Common
               Stock, the applicable Series C Conversion Prices shall,
               simultaneously with the happening of such dividend, subdivision
               or split be adjusted by multiplying the then effective Series C
               Conversion Price by a fraction, the numerator of which shall be
               the number of shares of Common Stock outstanding immediately
               prior to such event and the denominator of which shall be the
               number of shares of Common Stock outstanding immediately after



                                      -5-
<PAGE>

               such event. An adjustment made pursuant to this Section 5(g)(i)
               shall be given effect, upon payment of such a dividend or
               distribution, as of the record date for the determination of
               stockholders entitled to receive such dividend or distribution
               (on a retroactive basis) and in the case of a subdivision or
               combination shall become effective immediately as of the
               effective date thereof.

          (ii) ADJUSTMENT UPON CERTAIN QUALIFIED PUBLIC OFFERINGS. In the event
               that the Company shall issue shares of its Common Stock in a
               Qualified Public Offering in which the issue price is less than
               $10.00 per share for each share of Common Stock and such
               Qualified Public Offering is completed on or prior to the date
               which is 24 months from the date of filing of this Certificate of
               Designation (the "Initial Period"), then the Conversion Price
               shall be automatically adjusted to an amount equal to 50% of the
               issue price per share of the Common Stock under such Qualified
               Public Offering. In the event that the Company shall issue shares
               of its Common Stock in a Qualified Public Offering in which the
               issue price is less than $13.33 per share of the Common Stock and
               such Qualified Public Offering is completed after the Initial
               Period, then the Conversion Price shall be automatically adjusted
               to an amount equal to 37.5% of the issue price per share of the
               Common Stock under such Qualified Public Offering.

          (iii) RATCHET. In the event the Company shall issue shares of its
               Common Stock, or securities convertible into shares of Common
               Stock (excluding in each case shares issued (i) in any of the
               transactions described in Subsection (g)(i) above, (ii) upon
               exercise of options granted to the Company's employees,
               directors, consultants or officers under a plan or plans adopted
               by the Company's Board of Directors, if such shares would
               otherwise be included in this Subsection (g), (iii) upon
               conversion of shares or exercise of options and warrants
               outstanding as of the date hereof, or (iv) to shareholders of any
               Company which merges into the Company in proportion to their
               stock holdings of such Company immediately prior to such merger,
               upon such merger), for consideration per share less than the then
               applicable Conversion Price (the "Offering Price"), the
               Conversion Price shall be adjusted immediately thereafter so that
               it shall equal such Offering Price. Such adjustment shall be made
               successively whenever such an issuance is made.

     (h)  OTHER ADJUSTMENTS. In the event the Corporation shall make or issue,
          or fix a record date for the determination of holders of Common Stock
          entitled to receive, a dividend or other distribution payable in
          securities of the Corporation other than shares of Common Stock, then
          and in each such event lawful and adequate provision shall be made so
          that the holders of Series C Preferred Stock shall receive upon
          conversion thereof in addition to the number of shares of Common Stock
          receivable thereupon, the number of securities of the Corporation
          which they would have received had their Series C Preferred Stock been
          converted into Common Stock on the date of such event and had they
          thereafter, during the period from the date of such event to and
          including the date of conversion retained such securities receivable
          by them as aforesaid during such period, giving application to all
          adjustments called for during such period under this Section 5 as
          applied to such distributed securities. If the Common Stock issuable
          upon the conversion of the Series C Preferred Stock shall be changed




                                      -6-
<PAGE>

          into the same or different number of shares of any class or classes of
          stock, whether by reclassification or otherwise (other than a
          subdivision or combination of shares or stock dividend provided for
          above, or a reorganization, merger, consolidation or sale of assets
          provided for elsewhere in this Section 5(h)), then and in each such
          event the holder of each share of Series C Preferred Stock shall have
          the right thereafter to convert such share into the kind and amount of
          shares of stock and other securities and property receivable upon such
          reorganization, reclassification or other change, by holders of the
          number of shares of Common Stock into which such shares of Series C
          Preferred Stock might have been converted immediately prior to such
          reorganization, reclassification or change, all subject to further
          adjustment as provided herein.

     (i)  MERGERS AND OTHER REORGANIZATIONS. If at any time or from time to time
          there shall be a capital reorganization of the Common Stock (other
          than a subdivision, combination, reclassification or exchange of
          shares provided for in Section 5(g) hereof) or a merger or
          consolidation of the Corporation with or into another corporation or
          the acquisition of the Corporation or the sale of all or substantially
          all of the Corporation's properties and assets to any other person,
          then, as a part of and as a condition to the effectiveness of such
          reorganization, merger, consolidation, acquisition or sale, lawful and
          adequate provision shall be made so that the holders of the Series C
          Preferred Stock shall thereafter be entitled to receive upon
          conversion of the Series C Preferred Stock, to receive the number of
          shares of stock or other securities or property of the Corporation or
          of the successor corporation resulting from such recapitalization,
          merger, consolidation or sale, which a holder of Common Stock would
          have been entitled to receive on such capital reorganization, merger,
          consolidation or sale. In any such case, appropriate provisions shall
          be made with respect to the rights of the holders of the Series C
          Preferred Stock after the reorganization, merger, consolidation,
          acquisition or sale such that the provisions of this Section 5
          (including without limitation provisions for adjustment of the Series
          C Conversion Price and the number of shares of Common Stock into which
          the holders of Series C are entitled to purchase the Series C
          Preferred Stock) shall thereafter be applicable, as nearly as can be,
          with respect to any shares of stock, securities or assets to be
          deliverable thereafter upon the conversion of the Series C Preferred
          Stock.

     (j)  NO IMPAIRMENT. The Corporation will not, by amendment of its
          Certificate of Incorporation or through any reorganization, transfer
          of assets, consolidation, merger, dissolution, issue or sale of
          securities or any other voluntary action, avoid or seek to avoid the
          observance or performance of any of the terms to be observed or
          performed hereunder by the Corporation, but will at all times in good
          faith assist in the carrying out of all of the provisions of this
          Section 5 and in the taking of all such action as may be necessary or
          appropriate in order to protect the rights of the holders of the
          Series C Preferred Stock against impairment.

     (k)  NOTICES OF ADJUSTMENTS. In each case of an adjustment or readjustment
          of the then applicable Series C Conversion Price, the Corporation will
          furnish each holder of Series C Preferred Stock with a certificate,
          prepared by the chief financial officer of the Corporation, showing
          such adjustment or readjustment, and stating in detail the facts upon
          which such adjustment or readjustment is based.


                                      -7-
<PAGE>


6. VOTING RIGHTS. Except as otherwise required by law, each holder of Series C
Preferred Stock shall be entitled to vote on all matters and each such holder
shall be entitled to that number of votes equal to the largest number of whole
shares of Common Stock into which such holder's shares of Series C Preferred
Stock could be converted pursuant to the provisions of Section 5 ,hereof, at the
record date for the determination of stockholders entitled to vote on such
matter or, if no such record date is established, at the date such vote is taken
or any written consent of stockholders is solicited. Except as required by law,
the holders of Series A Preferred Stock, Series B Preferred Stock, Series C
Preferred Stock and Common Stock shall vote together as a single class on all
matters; provided, that an affirmative vote of the holders of at least
two-thirds of the outstanding shares of Series C Preferred stock voting as a
separate class, shall be necessary to alter the rights and preferences of the
Series C Preferred Stock, or to issue any security with rights senior to those
of the holders of the Series C Preferred.

7. NO REISSUANCE OF SERIES C PREFERRED STOCK. No share or shares of the Series C
Preferred Stock acquired by the Corporation by reason of redemption, purchase,
conversion or otherwise shall be reissued, and all such shares shall be
canceled, retired and eliminated from the shares which the Corporation shall be
authorized to issue. The Corporation may from time to time take such appropriate
corporate action as may be necessary to reduce the authorized number of shares
of the Series C Preferred Stock accordingly.

8. NOTICES OF RECORD DATE. In the event (i) the Corporation establishes a record
date to determine the holders of any class of securities who are entitled to
receive any dividend or other distribution or (ii) there occurs any capital
reorganization of the Corporation, any reclassification or recapitalization of
the capital stock of the Corporation, any merger or consolidation of the
Corporation, any acquisition of the Corporation, any transfer of all or
substantially all of the assets of the Corporation to any other Corporation
entity or person, any sale of a majority of the voting securities of the
Corporation in one or a series of related transactions or any voluntary or
involuntary dissolution, liquidation or winding up of the Corporation, the
Corporation shall mail to each holder of Series C Preferred Stock at least
twenty (20) days prior to the record date specified therein, a notice specifying
(a) the date of such record date for the purpose of such dividend or
distribution and a description of such dividend or distribution, (b) the date on
which any such reorganization, reclassification, transfer, consolidation,
merger, acquisition, sale, dissolution, liquidation or winding up is expected to
become effective, and (c) the time, if any, that is to be fixed, as to when the
holders of record of Common Stock (or other securities) shall be entitled to
exchange their shares of Common Stock (or other securities) for securities or
other property deliverable upon such reorganization, reclassification, transfer,
consolidation, merger, acquisition, sale, dissolution, liquidation or winding
up.

9. PREEMPTIVE RIGHTS. Subject to the terms and conditions specified in this
Section 9, each time the Corporation proposes to offer any shares of, or
securities convertible into, or exchangeable or exercisable for, any shares of
its Common Stock, the Corporation shall make an offering of such securities to
the holders of shares of Series C Preferred Stock in accordance with the
following provisions:

     (a)  The Corporation shall deliver a notice ("Notice") to holders of shares
          of Series C Preferred Stock stating (i) its bona fide intention to
          offer such securities, (ii) the number of such securities to be
          offered, and (iii) the price and terms, if any, upon which it proposes
          to offer such securities.



                                      -8-
<PAGE>


     (b)  By written notification received by the Corporation, within thirty
          (30) calendar days after giving of Notice, each holder of shares of
          the Series C Preferred may elect to purchase, at the price and on the
          terms specified in the Notice, up to that portion of such securities
          which equals the ratio of the number of shares of Common Stock issued
          and held (as a result of any conversion of Shares to Common Stock), or
          issuable upon conversion of the Shares then held, by such holder of
          shares of Series C Preferred Stock, over the total number of shares of
          Common Stock of the Corporation then outstanding.

     (c)  If all securities referred to in the Notice which holders of shares of
          Series C Preferred Stock are entitled to obtain pursuant to subsection
          9(b) are not elected to be purchased as provided in subsection 9(b)
          hereof, the Corporation may, during the one hundred eighty (180) day
          period following the expiration of the thirty (30) day period provided
          in subsection 9(b) hereof, offer the remaining unsubscribed portion of
          such securities to any person or persons at a price not less than, and
          upon terms no more favorable to the offeree than those specified in
          the Notice. If the Corporation does not enter into an agreement for
          the sale of such securities within such period, or if such agreement
          is not consummated within ninety (90) days of the execution thereof,
          the right provided hereunder shall be deemed to be revived and such
          securities shall not be offered unless first reoffered to the holders
          of shares of Series C Preferred Stock in accordance herewith.

     (d)  The preemptive right in this Section 9 shall not be applicable to:

          (i)  shares of Common Stock issuable or issued to employees, advisors,
               consultants or outside directors of the Corporation directly or
               pursuant to a stock option plan or restricted stock plan approved
               by the Board of Directors of the Corporation;

          (ii) Common Stock issued or issuable upon exercise of warrants to
               purchase shares of Common Stock outstanding on the date hereof;

          (iii) Common Stock issued or issuable upon conversion of shares of any
               series of Preferred Stock which has been authorized as of the

          date hereof, including the Series C Preferred Stock; (iv) Common Stock
               issued or issuable in connection with a merger or consolidation,
               if as a result of which, the holders of the Corporation's
               outstanding securities immediately prior to the consummation of
               such transaction hold voting securities in excess of fifty
               percent (50%) of the voting power of the surviving or resulting
               entity; or of the Corporation's securities; and

          (v)  Common Stock issued in any initial public offering.




                                      -9-
<PAGE>


10. INFORMATION RIGHTS. The holders of shares of Series C Preferred Stock shall
have the right to obtain information from the Corporation in the same manner and
to the same extent as the holders of shares of Common Stock are entitled under
the Certificate of Incorporation, the Corporation's Bylaws or applicable law.

                                    * * * * *

                [Remainder of this page intentionally left blank]















                                      -10-
<PAGE>


IN WITNESS WHEREOF, the undersigned has executed this Certificate of Designation
this 27th day of March, 2003.



                                      /S/ MICHAEL P. MORAN
                                      --------------------
                                      Michael P. Moran
                                      President and Chief Executive Officer













                                      -11-
<PAGE>