<PAGE>





 
                                  EXHIBIT 3.1


                     ARTICLES OF INCORPORATION, AS AMENDED


                          ONLINE SYSTEM SERVICES, INC.










                                        
<PAGE>
 
                           ARTICLES OF INCORPORATION
                           -------------------------
                                       OF
                                       --
                          ONLINE SYSTEM SERVICES, INC.
                          ----------------------------

     The undersigned incorporator, being a natural person of the age of eighteen
years or more hereby establishes a corporation pursuant to the statutes of the
State of Colorado and adopts the following Articles of Incorporation:

                                   ARTICLE I
                                   ---------

                                      NAME
                                      ----

     The name of the corporation shall be Online System Services, Inc.

                                   ARTICLE II
                                   ----------

                               PERIOD OF DURATION
                               ------------------

     This Corporation shall exist in perpetuity, from and after the date of
filing these Articles of Incorporation with the Secretary of State of the State
of Colorado unless dissolved according to law.

                                  ARTICLE III
                                  -----------

                                    PURPOSES
                                    --------

     The purpose for which this corporation is organized is to engage in any
lawful act or activity for which corporations may be organized under the laws of
the State of Colorado.

     In furtherance of the foregoing purposes, the Corporation shall have and
may exercise all of the rights, powers and privileges now or hereafter conferred
upon corporations organized under the laws of the State of Colorado.  In
addition, it may do everything necessary, suitable or proper for the
accomplishment of any of its corporate purposes.
<PAGE>
 
                                   ARTICLE IV
                                   ----------

                                    CAPITAL
                                    -------

     1.  Authorized Shares.  The aggregate number of shares which this
corporation shall have authority to issue is 10,000 shares, all of one class,
Common Stock, having no par value.

     2.  Restrictions.  The Corporation shall have the right to impose
restrictions on the transfer of shares of the Corporation.

     3.  Dividends.  The Board of Directors may from time to time distribute to
shareholders in partial liquidation, or out of stated capital or capital surplus
of the Corporation, a portion of its assets, in cash or property, subject to the
limitations contained within the statutes of the State of Colorado.

     4.  Distribution in Liquidation.  Upon any liquidation, dissolution or
winding up of the Corporation, and after paying or adequately providing for the
payment of all its obligations, the remainder of the assets of the Corporation
shall be distributed, either in cash or in kind, pro rata to the holders of the
Common Stock.

                                   ARTICLE V
                                   ---------

                             VOTING BY SHAREHOLDERS
                             ----------------------

     1.  Voting Rights; No Cumulative Voting.  Each outstanding share of Common
Stock is entitled to one vote and each fractional share of Common Stock is
entitled to a corresponding fractional vote on each matter submitted to a vote
of shareholders.  Cumulative voting shall not be allowed in the election of
directors of the Corporation and every shareholder entitled to vote at such
election shall have the right to vote the number of shares owned by him for as
many persons as there are directors to be elected, and for whose election he has
a right to vote.

     2.  Denial of Preemptive Rights.  No shareholder of the Corporation,
whether now or hereafter authorized, shall have any preemptive or similar right
to acquire any additional unissued or treasury shares of stock or securities of
any class or rights, warrants or options to purchase stock or scrip or
securities in any kind, including shares or securities convertible into shares
or carrying stock purchase warrants or privileges.

     3.  Majority Vote.  A quorum for the purpose of stockholder meetings will
consist of a majority of the shares issued and outstanding and entitled to vote
at the meeting.
<PAGE>
 
     When a quorum is present, and when the statute requires a vote of two-
thirds of the shares entitled to vote to take action, the affirmative vote of a
majority of the shares issued and outstanding and entitled to vote on the
subject matter shall be the act of the stockholders.

                                   ARTICLE VI
                                   ----------

                               BOARD OF DIRECTORS
                               ------------------

     The initial Board of Directors shall consist of three (3) directors, and
the names and addresses of the persons who shall serve as directors until the
first annual meeting of the shareholders or until their successors are elected
and shall qualify are:

NAME                     MAILING ADDRESS

R. Steven Adams         1800 Glenarm Place, Suite 700
                        Denver, Colorado 80202

Craig A. Snapp          9063 S. Bermuda Run Circle
                        Highlands Ranch, CO 80126

Thomas D. Smart         1700 Broadway, Suite 1800
                        Denver, CO 80290

     The number of directors shall be prescribed by the Bylaws except that there
need be only as many directors as there are shareholders in the event that the
outstanding shares are held of record by fewer than two persons.

                                  ARTICLE VII
                                  -----------

                RIGHT OF DIRECTORS TO CONTRACT WITH CORPORATION
                -----------------------------------------------

     The following provisions are inserted for the management of the business
and for the conduct of the affairs of the Corporation, and the same are in
furtherance of and not in limitation of the powers conferred by law.

          1.  No contract or other transaction between this Corporation and one
or more of its directors or any other corporation, firm, association, or entity
in which one or more of its directors are directors or officers or are
financially interested shall be either void or voidable solely because of such
relationship or interest or solely because such directors are present at the
meeting of the Board of Directors or a committee thereof which authorizes,
approves, or ratifies such contract or transaction or solely because their votes
are counted for such purpose if:
<PAGE>
 
               (a) The material facts as to such relationship or interest and as
     to the contract or transaction are disclosed or are otherwise known to the
     Board of Directors or committee and the board or committee authorizes,
     approves, or ratifies such contract or transaction by the affirmative vote
     of a majority of the disinterested directors, even though the directors are
     less than a quorum; or

               (b) The material facts of such relationship or interest and as to
     the contract of transaction are disclosed or otherwise known to the
     shareholders entitled to vote thereon and they authorize, approve, or
     ratify such contract or transaction by vote or written consent; or

               (c) The contract or transaction is fair and reasonable to the
     Corporation.

          2.   Common or interested directors may be counted in determining the
presence of a quorum at a meeting of the Board of Directors or a committee
thereof which authorizes, approves or ratifies such contract or transaction.

                                  ARTICLE VIII
                                  ------------

                             CORPORATE OPPORTUNITY
                             ---------------------

          The officers, directors and other members of management of this
Corporation shall be subject to the doctrine of "corporate opportunities" only
insofar as it applies to business opportunities in which this Corporation has
expressed an interest as determined from time to time by this Corporation's
Board of Directors as evidenced by resolutions appearing in the Corporation's
minutes.  Once such areas of interest are delineated, all such business
opportunities within such areas of interest which come to the attention of the
officers, directors, and other members of management of this Corporation shall
be offered first to the Corporation.  In the event the Corporation declines to
pursue any or all such business opportunities, the officers, directors and other
members of management of this Corporation shall be free to engage in such areas
of interest on their own and this doctrine shall not limit the right of any
officer, director or other member of management of this Corporation (other than
an officer, director, or member of management) from any duties which he may have
to this Corporation.

                                   ARTICLE IX
                                   ----------

                          Indemnification of Officers,
                          ----------------------------
                              Directors and Others
                              --------------------

          1.  To the full extent permitted by the Colorado Corporation Code, the
Corporation shall indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative and whether
formal or informal (other than an action by or in the right of the Corporation)
by reason of the fact that he is or was a Director, Officer, employee, fiduciary
or agent of the Corporation, or is or was serving at the request of the
Corporation as a Director, Officer, employee, fiduciary or agent of another
corporation, partnership, joint venture, 
<PAGE>
 
trust, employee benefit plan or other enterprise, against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding if
he conducted himself in good faith and in a manner he reasonably believed to be
in or not opposed to the best interests of the Corporation, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement, or conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, create a presumption that the person did
not act in good faith and in a manner which he reasonably believed to be in or
not opposed to the best interests of the Corporation and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his conduct
was unlawful.

          2.  The Corporation shall indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the Corporation to procure a judgment in
its favor by reason of the fact that he is or was a Director, Officer, employee,
fiduciary or agent of the Corporation, or is or was serving at the request of
the Corporation as a Director, Officer, employee or agent of another
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the Corporation and except that no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable for negligence or
misconduct in the performance of his duty to the Corporation unless and only to
the extent that the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which such court shall deem proper.

          3.  To the extent that a Director, Officer, employee, fiduciary or
agent of the Corporation has been wholly successful on the merits or otherwise
in defense of any action, suit or proceeding referred to in paragraphs 1 and 2
of this Article, or in defense of any claim, issue or matter therein, he shall
be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection therewith.

          4.  Any indemnification under paragraphs 1 and 2 of this Article
(unless ordered by a court) shall be made by the Corporation only as authorized
in the specific case upon a determination that indemnification of the Director,
Officer, employee, fiduciary or agent is proper in the circumstances because he
has met the applicable standard of conduct set forth in paragraphs 1 and 2.
Such determination shall be made (1) by the Board of Directors by a majority
vote of a quorum consisting of Directors who were not parties to such action,
suit or pending, or (2) if such a quorum is not attainable, or, even if
obtainable a quorum of disinterested Directors so directs, by independent legal
counsel in a written opinion, or (3) by the stockholders.

          5.  Expenses (including attorneys' fees) incurred in defending a civil
or criminal action, suit or pending may be paid by the Corporation in advance of
the final disposition of such 
<PAGE>
 
action, suit or proceeding as authorized in the manner provided in paragraph 4
of this Article upon receipt of an undertaking by or on behalf of the Director,
Officer, employee, fiduciary or agent to repay such amount unless it shall
ultimately be determined that he is entitled to be indemnified by the
Corporation as authorized in this section.

          6.  The Corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a Director, Officer, employee,
fiduciary or agent of the Corporation, or is or was serving at the request of
the Corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise against any liability asserted against him and incurred by him in any
such capacity or arising out of his status as such, whether or not the
Corporation would have the power to indemnify him against such liability under
the provisions of this section.

          7.  In addition to the foregoing, the Corporation shall have the power
to indemnify current or former directors, officers, employees and agents to the
fullest extent provided by the laws of the State of Colorado.

                                   ARTICLE X
                                   ---------

                               DIRECTOR LIABILITY
                               ------------------

          To the fullest extent permitted by the Colorado Corporation Code, as
the same exists or may hereafter be amended, a director of this Corporation
shall not be liable to the Corporation or its shareholders for monetary damages
for breach of fiduciary duty as a director.

                                   ARTICLE XI
                                   ----------

                     REGISTERED OFFICE AND REGISTERED AGENT
                     --------------------------------------

          The address of the initial registered office of the Corporation is
1800 Glenarm Place, Suite 700, Denver, Colorado 80202 and the name of the
initial registered agent at such address is R. Steven Adams.  Either the
registered office or the registered agent may be changed in the manner permitted
by law.

                                  ARTICLE XII
                                  -----------

                                  INCORPORATOR
                                  ------------

          The name and address of the incorporator is as follows:

NAME                    ADDRESS

Kim P. Castillo         1800 Glenarm Place, Suite 700
                        Denver, Colorado 80202

          IN WITNESS WHEREOF, the above-named incorporator has signed these
Articles of Incorporation this 22nd day of March, 1994.
                               -----       -----       
<PAGE>
 
                              /s/ Kim P. Castillo
                              -------------------
                              Kim P. Castillo

STATE OF COLORADO  )
                    )ss.
COUNTY OF DENVER  )

          I, the undersigned, a Notary Public, hereby certify that on the 22nd
                                                                          ----
day of March, 1994, personally appeared before me, Kim P. Castillo, who being by
       ------                                                                   
me first duly sworn, severally declared that she is the person who signed the
foregoing document as incorporator, and the statements therein contained are
true.

          WITNESS my hand and official seal.

                              /s/ Colleen K. Overocker
                              ------------------------
                              Notary Public


My Commission Expires:  05/17/1995
<PAGE>
 
                             ARTICLES OF AMENDMENT
                                       OF
                           ARTICLES OF INCORPORATION
                                       OF
                          ONLINE SYSTEM SERVICES, INC.


     The undersigned, R. Steven Adams, President  of Online System Services,
Inc., a Colorado corporation (the "Corporation"), DOES HEREBY CERTIFY that the
number of votes cast for the following amendment by each voting group entitled
to vote separately on the amendment was sufficient for approval by that group,
in that the sole shareholder of the Corporation approved and adopted the
amendment in all respects:


     ARTICLE IV of the Articles of Incorporation of the Corporation is amended
     ----------                                                               
and replaced in its entirety to read as follows:

                                   ARTICLE IV
                                   ----------

                                    CAPITAL
                                    -------

     1.   Authorized Shares.  The aggregate number of shares that the
Corporation has authority to issue is 15,000,000.  The shares are classified in
two classes, consisting of 10,000,000 shares of Common Stock , no par value, and
5,000,000 shares of Preferred Stock, with such par value as the Board of
Directors of the Corporation may designate.  The Board of Directors of the
Corporation is authorized to establish one or more series of Preferred Stock,
setting forth the designation of each such series, and fixing the preferences,
limitations and relative rights of each such series of Preferred Stock.

     2.   Transfer Restrictions.  The Corporation shall have the right to impose
restrictions on the transfer of shares of the Corporation.

     3.   Dividends.  The Board of Directors of the Corporation may from time to
time distribute to shareholders in partial liquidation, or out of stated capital
or capital surplus of the Corporation, a portion of its assets, in cash or
property, subject to the limitations contained within the statutes of the State
of Colorado.

     4.   Distributions in Liquidation.  Upon any liquidation, dissolution or
winding up of the Corporation, and after paying or adequately providing for the
payment of all its obligations, the remainder of the assets of the Corporation
shall be distributed, either in cash or in kind, and subject to any preferences
of any series of Preferred Stock, to the shareholders of the Corporation.
<PAGE>
 
     I FURTHER CERTIFY that the foregoing amendment was approved and adopted by
the Corporation's sole shareholder effective as of  the 17th day of March, 1995.


     IN WITNESS WHEREOF, the undersigned has executed these Articles of
Amendment this 31st day of July, 1995.
               ----                  


                                    /s/ R. Steven Adams
                                    -------------------
                                    R. Steven Adams, President
<PAGE>
 
     The undersigned, Thomas S. Plunkett, Chief Financial Officer of Online
System Services, Inc., a Colorado corporation (the "Corporation"), DOES HEREBY
CERTIFY that pursuant to actions taken by the Board of Directors on December 16,
1997 in accordance with Sections 7-106-101, 7-106-102 and 7-110-102 of the
Colorado Business Corporation Act, the following amendment was duly adopted by
the Board of Directors without shareholder approval as permitted by Section 7-
106-102(4) of the Colorado Business Corporation Act:


     ARTICLE IV of the Articles of Incorporation of the Corporation, as amended,
     ----------                                                                 
is further amended  by adding a new Section 5, the text of which is set forth on
Exhibit A attached hereto.


     IN WITNESS WHEREOF, the undersigned has executed these Articles of
Amendment this 30th day of December, 1997.


                                    /s/ Thomas S. Plunkett
                                    ----------------------
                                    Thomas S. Plunkett, Chief
                                     Financial Officer
<PAGE>
 
                                   EXHIBIT A
                                        
     5.   Designation of 10% Preferred Stock.  The Corporation shall establish
and reserve for issuance from its 5,000,000 authorized shares of Preferred Stock
a class of preferred stock consisting of 500,000 shares to be known as the 10%
Preferred Stock (the "10% Preferred Stock").  The 10% Preferred Stock shall have
a stated value of $10.00 per share.  The preferences, limitations and relative
rights of the 10% Preferred Stock  shall be as provided in this Section 5.

          A. Voting Rights.

               (1) Each outstanding share of the 10% Preferred Stock is entitled
          to one vote on each matter submitted to a vote of shareholders.  The
          holders of the 10% Preferred Stock shall be entitled to vote on all
          matters voted upon by the holders of the Corporation's Common Stock.
          Unless otherwise required by law, the holders of the Common Stock and
          the holders of the 10% Preferred Stock shall vote as a single class on
          all matters submitted to a vote of shareholders.

               (2) The holders of the 10% Preferred Stock shall not be entitled
          to any rights of cumulative voting with respect to their shares.

          B.   Preemptive Rights. No holder of the 10% Preferred Stock shall
     have any preemptive or similar right to acquire any additional unissued or
     treasury shares of stock or securities of any class or rights, warrants or
     options to purchase stock or scrip or securities in any kind, including
     shares or securities convertible into shares or carrying stock purchase
     warrants or privileges.

          C.   Dividends.

               (1) Dividends shall accrue on the 10% Preferred Stock at the rate
          of ten percent (10%) per annum on the stated value of the 10%
          Preferred Stock and shall be paid quarterly on the first of each
          January, April, July and October, beginning July 1, 1998, to the
          record holder thereof on the 15th of the previous month, subject to
          the limitations contained within the statutes of the State of
          Colorado.  Dividends not paid in any quarter shall accumulate until
          paid, with interest on the unpaid balance, if any, accruing simple
          interest at the rate stated above.  Subject to the foregoing
          limitations, dividends may be paid out of any funds legally available
          for such purpose.

               (2) Dividends on the 10% Preferred Stock shall be declared and
          paid before dividends of any kind may be declared and paid on the
          Common Stock or any inferior class or series of stock and before
          distribution or any liquidation or distribution of any kind may be
          made upon the issued and outstanding Common Stock or any inferior
          class of stock.
<PAGE>
 
          (3) Upon any redemption or conversion of the 10% Preferred Stock
     pursuant to paragraphs G and H below, the Corporation shall pay all accrued
     but unpaid dividends on the 10% Preferred Stock called for redemption or
     converted, as the case may be. The Corporation may pay such accrued but
     unpaid dividends either (i) in cash or (ii) by issuing shares of Common
     Stock at a price per share equal to the lesser of (a) $10.00 or (b) if a
     redemption or a conversion occurring with respect to shares of the 10%
     Preferred Stock for which the Corporation has given a Notice of Redemption
     (as that term is defined in subparagraph G(2), below), the Average Per
     Share Closing Bid Price (as defined below) for the five trading days
     immediately preceding the date on which the Notice of Redemption was first
     given to the holders of the 10% Preferred Stock called for redemption, or,
     if a conversion occurring with respect to shares of the 10% Preferred Stock
     for which the Corporation has not given a Notice of Redemption, the Average
     Per Share Closing Bid Price for the five trading days immediately preceding
     the date on which the Conversion Notice (as that term is defined in
     subparagraph H(3), below) was first given to the Corporation.

          (4) Upon payment by the Corporation of dividends on the basis
     described in subparagraphs C(1)-C(3), the holders of the 10% Preferred
     Stock shall have no further right to dividends and shall not participate in
     any manner in dividends declared and paid or other distributions on the
     Common Stock or any inferior class or series of stock.

     D.   Liquidation Preference. In the event of the liquidation, dissolution
or winding up of the affairs of the Corporation, whether voluntary or
involuntary, the holders of the 10% Preferred Stock shall be entitled to
receive, after payment by the Corporation of its debts and liabilities, the
stated value of all shares of the 10% Preferred Stock in cash plus any all
accrued but unpaid dividends out of the assets of the Corporation before any
payment shall be made or any assets distributed to the holders of the Common
Stock or any other inferior class or series of stock. If sufficient assets are
not available to pay all holders of the 10% Preferred Stock in full, the
available assets shall be distributed to the holders of the 10% Preferred Stock
on a pro rata basis. Except as provided in this paragraph D, the holders of the
10% Preferred Stock shall not be entitled to receive any other payments from the
Corporation in the event of the liquidation, dissolution or winding up of the
affairs of the Corporation.

     E.   Other Securities, Obligations.

          (1) Subject to any limitations contained in these Articles of
     Incorporation, the Board of Directors of the Corporation reserves the right
     to establish additional classes and/or series of capital stock of the
     Corporation and to designate the preferences, limitations and relative
     rights of any such classes and/or series; provided, however, that no such
     class and/or series may have preferences, limitations and relative rights
     which are superior to or senior to the preferences, limitations and
     relative rights granted to the holders of the 10% Preferred Stock.

<PAGE>
 
              (2) At any time during which any shares of the 10% Preferred
          Stock are outstanding, the Corporation shall not incur any obligation
          or liability other than trade payables and other short-term
          indebtedness incurred in the ordinary course of business that is
          superior to or senior to the 10% Preferred Stock in any respects,
          including liquidation preferences.

          F.  Capital Reorganization.  If the Corporation shall at any time
     hereafter subdivide or combine its outstanding shares of Common Stock,
     declare a dividend payable in Common Stock, or in case of any capital
     reorganization or reclassification of the shares of Common Stock of the
     Corporation, the number of shares and stated value of the 10% Preferred
     Stock shall be adjusted appropriately to allow the holders of the 10%
     Preferred Stock, as nearly as reasonably possible, to maintain (i) the
     aggregate stated value of their 10% Preferred Stock and (ii) their pro rata
     interest in the Corporation and in the Common Stock upon conversion of the
     10% Preferred Stock, that they had prior to any such subdivision,
     combination, stock dividend, reorganization or reclassification.

          G.  Redemption.

              (1) The 10% Preferred Stock may be redeemed by the Corporation, in
          whole or in part, at any time for $10.00 per share (the "Redemption
          Price"). It is the Corporation's intent to use its best efforts to
          raise sufficient capital to both fund its operations and to permit it
          to redeem the 10% Preferred Stock as soon as is reasonably possible.
          In addition, if the Corporation completes a public offering of its
          securities that raises net proceeds of at least $5,000,000 (the
          "Public Offering") within nine months from the date on which the
          initial closing of the offering of the 10% Preferred Stock occurs (the
          "Closing Date"), then the Corporation shall redeem all of the
          outstanding 10% Preferred Stock.

              (2) The Corporation shall give not more than sixty (60) nor less
          than thirty (30) days notice (the "Notice of Redemption") of the date
          fixed for any redemption (as fixed, the "Redemption Date") of the 10%
          Preferred Stock by mailing the Notice of Redemption to the record
          holders of the 10% Preferred Stock to such holder's address as it
          appears on the records of the Corporation; provided, however, that the
          Corporation shall not be required to give notice of any redemption of
          the 10% Preferred Stock that occurs within nine months from the
          Closing Date.  In the case of a partial redemption of the 10%
          Preferred Stock, the shares to be redeemed shall be selected in any
          manner the Corporation may determine.  The Notice of Redemption shall
          be deemed given when it is deposited in the United States mail with
          sufficient postage affixed or when it is delivered to the record
          holder at such holder's address as it appears on the records of the
          Corporation.

              (3) On the Redemption Date, all rights of the holders of the 10%
          Preferred Stock called for redemption shall cease and terminate with
          respect to 
<PAGE>
 
          such shares except (i) the right to receive the Redemption
          Price upon surrender of the certificates representing the shares of
          the 10% Preferred Stock called for redemption and (ii) the right to
          receive payment of all dividends with respect to the shares of 10%
          Preferred Stock called for redemption which are accrued but unpaid on
          the Redemption Date.

          H.  Conversion.

              (1) If the 10% Preferred Stock is not redeemed within nine months
          from the Closing Date, each share of the outstanding 10% Preferred
          Stock shall become convertible, at the election of the holder thereof
          (the "Conversion Right"), into the number of shares of Common Stock of
          the Corporation equal to $10.00 divided by the lesser of (i) $10.00 or
          (ii) 80% of the Average Per Share Closing Bid Price of the
          Corporation's Common Stock as calculated pursuant to the next sentence
          The "Average Per Share Closing Bid Price" shall be (a) if the
          conversion occurs with respect to shares of the 10% Preferred Stock
          for which the Corporation has given a Notice of Redemption, the
          average per share closing bid price for the Corporation's Common Stock
          for the five trading days immediately preceding the date on which the
          Notice of Redemption was first given to the holders of the 10%
          Preferred Stock called for redemption or (b) if the conversion occurs
          with respect to shares of the 10% Preferred Stock for which the
          Corporation has not given a Notice of Redemption, the average closing
          bid price for the five trading days immediately preceding the date on
          which the holder gives the Conversion Notice (as that term is defined
          in subparagraph H(3), below) to the Corporation. The Closing Bid Price
          for the Common Stock at any date shall be (i) the Closing Bid Price of
          the Common Stock as reported in The Wall Street Journal (or, if not so
          reported, as otherwise reported by The Nasdaq Stock Market or, (ii) in
          the event that the Common Stock is listed on a stock exchange or on
          the Nasdaq National Market (or other national market), the Closing Bid
          Price shall be the closing price on the exchange or the Nasdaq
          National Market (or other national market), as the case may be, as
          reported in The Wall Street Journal (or, if not so reported, as
          otherwise reported by the stock exchange, Nasdaq or other national
          market). In the event that there is no reported Closing Bid Price or
          sale price, as the case may be, for a given day, the Closing Bid Price
          or sale price, as the case may be, for that day shall be deemed to be
          the Closing Bid Price or sale price, as the case may be, for the first
          day preceding such day for which there was a reported Closing Bid
          Price or sale price, as the case may be.

              (2) The Conversion Right shall expire and terminate five (5) days
          prior to the Redemption Date. In the case of a partial redemption of
          the 10% Preferred Stock, the Conversion Right shall so expire and
          terminate only with respect to the shares of the 10% Preferred Stock
          called for redemption.

              (3) In order to exercise the Conversion Right, the holder of the
          10% Preferred Stock to be converted shall give written notice (the
          "Conversion 
<PAGE>
 
          Notice") to the Corporation at its principal office or, at
          the option of the Corporation, at the offices of a conversion agent
          which the Corporation may designate from time to time by giving
          written notice of such designation to the holders of the 10% Preferred
          Stock, that the holder elects to convert such shares.  The Conversion
          Notice shall be accompanied by the certificate or certificates
          representing the shares of the 10% Preferred Stock to be converted,
          duly endorsed to the Corporation.  The Conversion Notice shall be
          deemed given when it is deposited in the United States mail with
          sufficient postage affixed or when it is delivered to the Corporation
          at its principal office (or to the offices of such conversion agent,
          if one be designated).


              (4) As soon as practicable after the receipt of the Conversion
          Notice and the certificates representing the shares of the 10%
          Preferred Stock to be converted, the Corporation shall issue and shall
          deliver to the record holder of the shares so surrendered for
          conversion by mail to the address of such record holder as it appears
          on the records of the Corporation, a certificate or certificates for
          the number of shares of Common Stock issuable upon conversion of the
          shares of the 10% Preferred Stock and a residual certificate for
          shares of the 10% Preferred Stock, if any, not converted.  Such
          conversion shall be deemed to have been effected on the date on which
          the Corporation (or the conversion agent, if one be designated), shall
          have received the Conversion Notice and the certificate or
          certificates representing shares of the 10% Preferred Stock to be
          converted, and the record holder shall be deemed to have become on
          such date the holder of record of the shares of Common Stock to be
          received upon conversion; provided, however, that any such surrender
          on any date when the stock transfer books of the Corporation shall be
          closed in accordance with the bylaws of the Corporation shall not be
          deemed to constitute the record holder as the holder of shares of
          Common Stock to be received upon conversion for any purpose until the
          close of business on the day succeeding the day on which such stock
          transfer books shall become open.

              (5) The Corporation shall not be required to issue fractional
          shares of Common Stock upon conversion of shares of the 10% Preferred
          Stock.  If any fractional interest in a share of Common Stock would be
          deliverable upon conversion of any shares of the 10% Preferred Stock,
          the Corporation shall make an adjustment therefor in cash at the
          current market value thereof, computed on the basis determined by the
          Corporation in its sole discretion.