E-2
                                       
                                                                    EXHIBIT 3.1

                           SECOND AMENDED AND RESTATED
                          CERTIFICATE OF INCORPORATION
                                       OF
                              ANDERSEN GROUP, INC.

         We, the subscribers, certify that we do hereby associate ourselves as a
body politic and corporate  under the statute laws of the State of  Connecticut;
and we further certify that:

FIRST:        The name of the corporation is Andersen Group, Inc.

SECOND:       The nature of the business to be transacted and the purposes to be
              promoted and carried out by the corporation are as follows:

              To  engage  in  any  lawful  act  or  activity   for  which  a
              corporation  may be  organized  under  the  provisions  of the
              Connecticut Business Corporation Act.

THIRD:        The amount  of  the  capital  stock  of  said  corporation  hereby
              authorized is six million(6,000,000) shares of common stock, 
              without par value, and eight hundred thousand (800,000) shares of
              preferred stock, without par value, the terms of which are set 
              forth on Exhibit A attached  hereto.  The Board of Directors is 
              authorized to issue, from time to time, all such shares, to fix 
              and determine the terms, limitations and relative rights and 
              preferences of the preferred stock into series, to fix and
              determine the variations among series to the extent permitted by
              law and to provide that shares of the preferred stock, or any 
              thereof, may series be convertible into the same or a different 
              number of shares of common stock.

FOURTH:       The amount of paid-in capital with which this corporation shall 
              commence business is $2,000.

FIFTH:        The duration of the corporation is unlimited.

SIXTH:        No stockholder  of said  corporation  shall have any preemptive or
              other right of subscription  to any  shares  of any class of stock
              of said corporation, issued  or  to  be  issued  or  sold, whether
              now or hereafter authorized, or to any securities convertible into
              stock of said corporation of any class, or to receive any such 
              shares or securities by way of dividend, other than right or 
              rights,  if any, as the Board of Directors may determine;  but any
              shares of stock or  convertible  securities  which the  Board of  
              Directors may determine to offer for subscription to  stockholders
              may, at the discretion of the Board of Directors, be offered in 
              such proportions and to the holders of any one or more or all
              classes of stock of the corporation then outstanding, and at such
              price or prices as the Board of Directors may determine.

SEVENTH:      A director of the corporation shall not be liable to the 
              corporation or its  shareholders  for breach of duty as a director
              for  monetary damages  in an amount in excess of the  compensation
              received by such  director  for serving the corporation during the
              year of such breach (or such lesser  amount as may  hereafter be 
              permitted by the Connecticut Business Corporation  Act), except to
              the extent such exemption from liability or limitation  thereof is
              not permitted under the Connecticut  Business  Corporation Act as 
              currently in effect or as the same may hereafter be amended.  No 
              amendment, modification or repeal of this provision shall 
              adversely affect any right or protection of a director that exists
              at the time of such  amendment,  modification  or repeal.



<PAGE>


                                    EXHIBIT A


                      STATEMENT FIXING AND DETERMINING THE
       TERMS OF SHARES OF SERIES A CUMULATIVE CONVERTIBLE PREFERRED STOCK
                            OF ANDERSEN GROUP, INC.

     The Series A Cumulative Convertible Preferred Stock of Andersen Group, Inc.
shall be  subject  to the  following  terms,  limitations,  relative  rights and
preferences.

         1.  Designation.  There  shall  be a series  of  Preferred  Stock,  the
designation  of which shall be the "Series A  Cumulative  Convertible  Preferred
Stock, without par value," hereinafter referred to as the Series A Stock and the
number of authorized shares constituting the Series A Stock shall be 800,000.

         2.  Dividends.  (a) The holders of the Series A Stock shall be entitled
to receive, when and as declared by the Board of Directors but only out of funds
legally available  therefor,  cumulative cash dividends at the rate specified in
subparagraph  (b) below,  and no more,  payable not later than 45 days after the
end of each fiscal quarter of the Company, commencing with the end of the fiscal
quarter  during which the Series A Stock is  initially  issued.  Such  dividends
shall be subject to  proportional  adjustment  if dividends  are payable for any
part of a  fiscal  quarter.  So long as any  share  of  Series  A Stock  remains
outstanding no dividend or other  distribution  shall be paid or declared on any
shares of Common Stock,  without par value (the "Common Stock"), of the Company,
other than  dividends  payable in shares of Common Stock of the Company,  unless
all cumulative  dividends on the Series A Stock shall have been paid or declared
and set apart for payment.  Subject to the  foregoing  and not  otherwise,  such
dividends  (payable in cash,  stock or  otherwise)  as may be  determined by the
Board of  Directors  may be declared  and paid on the Common  Stock from time to
time out of any funds legally available  therefor,  and the Series A Stock shall
not be entitled to participate in any such  dividends or  distributions  whether
payable in cash, stock or otherwise.

                  (b) Cumulative  dividends shall be payable at a quarterly rate
per share upon the Series A Stock in an amount equal to $0.375.

<PAGE>

         3.  Optional  Redemption.  All or any part of the Series A Stock may be
called for  redemption  by the Company at its option at any time or from time to
time on or after the day after the second  anniversary of February 28, 1991 (the
"Effective Time"), by paying therefor in cash a redemption price equal to $17.75
per share in the case of any such redemption during the period commencing on the
day after such second  anniversary  and ending on the third  anniversary  of the
Effective Time,  $18.00 per share in the case of any such redemption  during the
period  commencing  on the day after  such third  anniversary  and ending on the
fourth  anniversary of the Effective  Time,  $18.25 per share in the case of any
such  redemption  during the  period  commencing  on the day after  such  fourth
anniversary  and ending on the fifth  anniversary  of the  Effective  Time,  and
$18.75  per share in the case of any such  redemption  thereafter,  in each case
plus  accrued and unpaid  dividends to the date fixed for  redemption.  At least
twenty (20) days'  notice prior to the  redemption  date,  by prepaid  certified
mail,  shall be given  to the  holders  of  record  of the  Series A Stock to be
redeemed,  addressed to the last post office address shown on the records of the
Company.  On the date  fixed for  redemption,  and stated in such  notice,  such
holder of such Series A Stock  shall  surrender  such  holder's  certificate  or
certificates at the place designated in such notice and thereupon be entitled to
receive  payment of the redemption  price. If notice of redemption is duly given
and if funds for the  redemption  have been set  aside  prior to the  redemption
date,  notwithstanding  the fact that a shareholder may have failed to surrender
the same,  no dividend  shall be payable on such shares after the date fixed for
redemption, and all rights with respect to shares so called for redemption shall
forthwith,  after such date, terminate,  except only the right of the holders to
receive the redemption price thereof,  without  interest.  If fewer than all the
outstanding  shares  of  Series  A Stock  are to be  redeemed  pursuant  to this
paragraph,  the number of shares to be redeemed shall be determined by the Board
of Directors of the Company, and such shares shall be redeemed pro rata from all
record  holders of the Series A Stock in proportion to the number of such shares
held by such holders (rounding to the nearest whole share to avoid redemption of
fractional shares).

         4.       Voting Rights.

                  (a)  General.  The  shares  of  Series  A Stock  shall  not be
entitled to vote upon any matters upon which  shareholders are entitled to vote,
except to the extent required by law, including the right to a class vote in the
event of any  amendment to the  Company's  certificate  of  incorporation  which
creates a new class of shares  equal or senior to the  Series A Stock or changes
an existing  class of shares into a class equal or senior to the Series A Stock,
and except to the extent set forth in subparagraph (b) of this paragraph 4.

                  (b) Certain  Voting  Rights.  If and  whenever  six  quarterly
dividends or the equivalent (whether or not consecutive) payable on the Series A
Stock  shall be in  arrears  whether or not  earned or  declared,  the number of
Directors  then  constituting  the Board of  Directors  of the Company  shall be
increased  by one and the  holders of the Series A Stock,  voting  together as a
class,  shall be  entitled  to elect the one  additional  Director at any annual
meeting of  shareholders  or a special  meeting held in place  thereof,  or at a
special  meeting  of the  holders of the  Series A Stock  called as  hereinafter
provided.  Whenever  all  arrears  in  dividends  on the  Series  A  Stock  then
outstanding  shall have been paid and dividends thereon for the current dividend
period  shall have been paid or  declared  and set apart for  payment,  then the
right of the holders of the Series A Stock to elect such additional one Director
shall cease (but subject  always to the same  provisions for the vesting of such
voting rights in the case of any similar future  arrearages in  dividends),  and
the term of office of any  person  elected  as  Director  by the  holders of the
Series  A Stock  shall  forthwith  terminate  and the  number  of the  Board  of
Directors  shall be reduced  accordingly.  At any time after such  voting  power
shall have been so vested in the Series A Stock,  the  Secretary  of the Company
may, and upon the written  request of any holder of shares of the Series A Stock
(addressed to the Secretary at the principal office of the Company) shall,  call
a special  meeting of the holders of the Series A Stock for the  election of the
one Director to be elected by them as herein  provided,  such call to be made by
notice  similar to that  provided in the  by-laws  for a special  meeting of the
shareholders or as required by law. If any such special  meeting  required to be
called as above provided shall not be called by the Secretary within twenty (20)
days after receipt of any such request,  then any holder of shares of the Series
A Stock may call such  meeting,  upon the notice  above  provided,  and for that
purpose  shall  have  access to the stock  books of the  Company.  The  Director
elected at any such  special  meeting  shall hold  office  until the next annual
meeting of the  shareholders  or special  meeting held in place  thereof if such
office  shall not have  previously  terminated  as above  provided.  In case any
vacancy  shall occur with respect to the Director  elected by the holders of the
Series A Stock, a successor  shall be elected by the Board of Directors to serve
until the next annual  meeting of the  shareholders  or special  meeting held in
place thereof upon the nomination by the holders of the Series A Stock.

<PAGE>
         5.  Liquidation,  Dissolution  and  Winding  Up.  In the  event  of any
liquidation,  dissolution  or winding up of the affairs of the Company,  whether
voluntary or  involuntary,  the holders of the Series A Stock shall be entitled,
before any assets of the Company shall be distributed  among or paid over to the
holders of the Common  Stock,  to be paid  $18.75  per share  together  with any
accrued and unpaid dividends thereon, and to no more. If, upon such liquidation,
dissolution or winding up, the assets of the Company  distributable as aforesaid
among the holders of the Series A Stock shall be  insufficient to permit payment
to them of said amount, the entire assets shall be distributed ratably among the
holders of the Series A Stock issued and outstanding and having such priority.

<PAGE>

        6.  Conversion.  (a) The holder of shares of Series A Stock  shall have
the right, at its option,  to convert one or more of such shares into fully paid
and  nonassessable  shares of Common  Stock of the  Company at any time and from
time to time after the date of  issuance,  at the rate of 1.875 shares of Common
Stock for each one share of Series A Stock or at the rate which results from the
making of any  adjustment  specified in  subparagraph  (e) hereof (the number of
shares of Common Stock  issuable at any time,  giving effect to the latest prior
adjustment  pursuant to  subparagraph  (e) hereof,  if any, in exchange  for one
share of Series A Stock being hereinafter called the "Conversion Rate").

                  (b) The Series A Stock shall be  convertible  at the office of
any transfer agent of the Company,  and at such other office or offices, if any,
that the Board of Directors  may  designate,  into fully paid and  nonassessable
shares of Common Stock at the Conversion Rate. In case of the redemption for any
shares of Series A Stock, such right of conversation  shall cease and terminate,
as to the shares to be redeemed,  at the close of business on the date fixed for
such  redemption,  unless default shall be made in the payment of the redemption
price for the shares to be so redeemed.

                  (c) In order to convert  shares of Series A Stock into  shares
of Common Stock  pursuant to the right of conversion  set forth in  subparagraph
(a),  the  holder  thereof  shall  surrender  the  certificate  or  certificates
representing  Series A Stock,  duly endorsed to the Company or in blank,  at any
office herein above  mentioned  and shall give written  notice to the Company at
said office that such holder elects to convert the same,  stating in such notice
the name or names in which such holder wishes the  certificate  or  certificates
representing shares of Common Stock to be issued. The Company shall, within five
business  days,  deliver at said office to such holder of Series A Stock,  or to
such holder's nominee or nominees,  a certificate or certificates for the number
of shares of Common Stock to which such holder  shall be entitled as  aforesaid,
together  with cash to which such holder shall be entitled in lieu of fractional
shares  in an  amount  equal  to the  same  fraction  of the  Market  Price  (as
hereinafter  defined)  of a whole  share of  Common  Stock on the  business  day
preceding the day of conversion. The Company shall make no payment or adjustment
on  account  of any  dividends  accrued  on the  shares  of the  Series  A Stock
surrendered  for  conversion or any dividends upon shares of Common Stock issued
upon conversion,  except that the registered  holder of shares of Series A Stock
being  converted  shall be entitled to receive  payment of any unpaid  dividends
which  have  accrued  on such  shares for  dividend  periods up to the  dividend
payment date immediately preceding such surrender for conversion at the time the
Company makes  payment to other holders of the Series A Stock of accrued  unpaid
dividends for such dividend periods;  provided,  that if the Company acquires at
any time all outstanding shares of Series A Stock, the Company shall on the date
of the acquisition of the last outstanding  share,  declare and pay such accrued
and unpaid dividends out of funds legally available therefor. Shares of Series A
Stock shall be deemed to have been  converted as of the date of the surrender of
such shares for conversion as provided above, and the person or persons entitled
to receive the shares of Common Stock  issuable  upon such  conversion  shall be
treated  for all  purposes  as the record  holder or  holders of such  shares of
Common Stock on such date.  Upon  conversion  of only a portion of the number of
shares  covered  by  a  certificate   representing  shares  of  Series  A  Stock
surrendered for conversion,  the Company shall issue and deliver to, or upon the
written order of, the holder of the  certificate so surrendered  for conversion,
at the expense of the Company,  a new certificate  covering the number of shares
of Series A Stock  representing  the  unconverted  portion of the certificate so
surrendered,  which new  certificate  shall  entitle  the holder  thereof to the
rights of the shares of Series A Stock represented thereby to the same extent as
if the certificate  theretofore  covering such  unconverted  shares had not been
surrendered for conversion.

<PAGE>

                  (d) The  issuance of  certificates  for shares of Common Stock
upon the  conversion of shares of Series A Stock shall be made without charge to
the converting  stockholder for any original issue or transfer tax in respect of
the issuance of such certificates and any such tax shall be paid by the Company.
The Company shall not, however,  be required to pay any tax which may be payable
in respect  of any  transfer  involved  in the issue and  delivery  of shares of
Common  stock in a name other than that in which the shares of Series A Stock so
converted  were  registered,  and no such issue or delivery shall be made unless
and until the person requesting such issue has paid to the Company the amount of
any such tax or has established to the satisfaction of the Company that such tax
has been paid.

                  (e) The  Conversion  Rate shall be  subject  to the  following
adjustments:

                         (i) If the Company shall declare and pay to the holders
of Common  Stock a  dividend  or other  distribution  payable  in shares of
Common Stock or Convertible  Securities (as hereinafter defined), the Conversion
Rate in effect  immediately  prior thereto shall be adjusted so that the holders
of Series A Stock  hereafter  surrendered  for  conversion  shall be entitled to
receive the number of shares of Common  Stock which such holder would have owned
or been entitled to receive after the  declaration  and payment of such dividend
or other  distribution  if such  shares  of  Series A Stock  had been  converted
immediately  prior to the  record  date for the  determination  of  stockholders
entitled to receive such dividend or other distribution.

     (ii) If the Company shall subdivide the outstanding  shares of Common Stock
into a greater  number of shares of Common  Stock,  or combine  the  outstanding
shares  of  Common  Stock  into  a  lesser   number  of  shares,   or  issue  by
reclassification  of its shares of Common Stock any shares of the  Company,  the
Conversion  Rate in effect  immediately  prior thereto shall be adjusted so that
the holders of Series  Stock  thereafter  surrendered  for  conversion  shall be
entitled to receive the number of shares of Common Stock which such holder would
have owned or been  entitled to receive after the happening of any of the events
described above if such shares of Series A Stock had been converted  immediately
prior to the  happening  of such event on the day upon  which such  subdivision,
combination or reclassification, as the case may be, becomes effective.

<PAGE>

     (iii) If the Company  shall issue or sell any  Additional  Shares of Common
Stock for a consideration  per share less than the Conversion  Amount,  then the
Conversion  Rate shall be adjusted to the number  determined by multiplying  the
Conversion  Rate in  effect  immediately  prior  to such  issuance  or sale by a
fraction,  the  numerator of which shall be the number of shares of Common Stock
outstanding  immediately prior to the issuance or sale of such Additional Shares
of Common  Stock plus the number of such  Additional  Shares of Common  Stock so
issued or sold,  and the  denominator  of which shall be the number of shares of
Common  Stock  outstanding  immediately  prior to the  issuance  or sale of such
Additional  Shares of Common  Stock  plus the  number of shares of Common  Stock
which the aggregate  consideration for such Additional Shares of Common Stock so
issued  or sold  would  purchase  at a  consideration  per  share  equal  to the
Conversion Amount.  For the purposes of this subparagraph  (iii), the date as of
which the Conversation  Amount shall be computed shall be the earlier of (x) the
date on which the Company  shall enter into a firm  contract for the issuance or
sale of such  Additional  Shares of Common  Stock or (y) the date of the  actual
issuance or sale of such shares.

<PAGE>

     (iv) If the Company  shall  issue or sell any  warrants or options or other
rights  entitling the holders  thereof to subscribe  for or purchase  either any
Additional Shares of Common Stock or evidences of indebtedness,  shares of stock
or other securities which are convertible into or exchangeable,  with or without
payment of additional  consideration in cash or property,  for Additional Shares
of Common Stock (such  convertible or  exchangeable  evidences of  indebtedness,
shares  of stock or  other  securities  hereinafter  being  called  "Convertible
Securities"),  and the  consideration  per share for which Additional  Shares of
Common Stock may at any time thereafter be issuable pursuant to such warrants or
other rights or pursuant to the terms of such Convertible Securities (when added
to the  consideration  per  share of Common  Stock,  if any,  received  for such
Convertible  Securities,  warrants  or other  rights),  shall  be less  than the
Conversion  Amount,  then the  Conversion  Rate shall be adjusted as provided in
subparagraph (iii) on the basis that (x) the maximum number of Additional Shares
of Common  Stock  issuable  pursuant  to all such  warrants  or other  rights or
necessary  to  effect  the  conversion  or  exchange  of  all  such  Convertible
Securities   shall  be  deemed  to  have  been  issued  and  (y)  the  aggregate
consideration  (plus the  consideration,  if any,  received for such Convertible
Securities,  warrants or other  rights) for such  maximum  number of  Additional
Shares of Common  Stock  shall be deemed to be the  consideration  received  and
receivable by the Company for the issuance of such  Additional  Shares of Common
Stock pursuant to such warrants or other rights or pursuant to the terms of such
Convertible  Securities.  

                          (v) If the  Company  shall  issue or sell  Convertible
Securities and the consideration per share for which Additional Shares of Common
Stock  may at any time  thereafter  be  issuable  pursuant  to the terms of such
Convertible  Securities  shall be less  than  the  Conversion  Amount,  then the
Conversion Rate shall be adjusted as provided in subparagraph (iii) on the basis
that (x) the maximum  number of Additional  Shares of Common Stock  necessary to
effect the conversion or exchange of all such  Convertible  Securities  shall be
deemed to have been issued and (y) the aggregate  consideration for such maximum
number  of  Additional  Shares  of  Common  Stock  shall  be  deemed  to be  the
consideration  received and  receivable  by the Company for the issuance of such
Additional  Shares of Common  Stock  pursuant  to the terms of such  Convertible
Securities.  No  adjustment  of the  Conversion  Rate  shall be made  under this
subparagraph  (v) upon the  issuance  of any  Convertible  Securities  which are
issued  pursuant  to the  exercise  of any  warrants  or other  rights,  if such
adjustment shall previously have been made upon the issuance of such warrants or
other  rights  pursuant  to   subparagraph   (iv).  

     (vi) For the purposes of  subparagraphs  (iv) and (v), the date as of which
the Conversion Amount shall be computed shall be the earliest of (x) the date of
which the Company shall take a record of the holders of its Common Stock for the
purpose of entitling them to receive any warrants or other rights referred to in
subparagraph  (iv) or to receive  any  Convertible  Securities,  (y) the date on
which the Company  shall  enter into a firm  contract  for the  issuance of such
warrants or other rights or Convertible Securities or (z) the date of the actual
issuance of such warrants or other rights or Convertible Securities.

     (vii) No adjustment of the Conversion Rate shall be made under subparagraph
(iii) upon the  issuance  of any  Additional  Shares of Common  Stock  which are
issued  pursuant to the  exercise of any warrants or other rights or pursuant to
the exercise of any conversion or exchange rights in any Convertible Securities,
if such  adjustment  shall  previously  have been made upon the issuance of such
warrants or other rights or upon the issuance of such Convertible Securities (or
upon the  issuance  of any  warrants  or other  rights  therefor),  pursuant  to
subparagraphs (iv) or (v).

<PAGE>

     (viii) If any  warrants or other  rights (or any  portions  thereof)  which
shall  have  given  rise to any  adjustment  pursuant  to  subparagraph  (iv) or
conversion rights pursuant to Convertible Securities which shall have given rise
to any adjustment  pursuant to subparagraph (v) shall have expired or terminated
without the exercise  thereof  and/or if by reason of the terms of such warrants
or other rights or Convertible  Securities  there shall have been an increase or
increases,  with the passage of time or otherwise, in the price payable upon the
exercise or conversion  thereof,  then the Conversion  Rate  hereunder  shall be
readjusted (but to no greater extent than  originally  adjusted) on the basis of
(x) eliminating  from the  computation of any Additional  Shares of Common Stock
corresponding  to such  warrants or other rights or  conversion  rights as shall
have expired or terminated,  (y) treating the Additional Shares of Common Stock,
if any,  actually issued or issuable  pursuant to the previous  exercise of such
warrants or other rights or of  conversion  rights  pursuant to any  Convertible
Securities  as having been issued for the  consideration  actually  received and
receivable therefor, and (z) treating any of such warrants or other rights or of
conversion   rights  pursuant  to  any  Convertible   Securities   which  remain
outstanding  as being  subject to  exercise or  conversion  on the basis of such
exercise  or  conversion  price as shall be in  effect  at the  time;  provided,
however,  that any  consideration  which was actually received by the Company in
connection with the issuance or sale of such warrants or other rights shall form
part of the  readjustment  computation even though such warrants or other rights
shall have  expired  without the exercise  thereof.  (ix) To the extent that any
Additional Shares of Common Stock, any warrants or other rights to subscribe for
or purchase any Additional Shares of Common Stock, or any Convertible Securities
shall be issued for a cash  consideration,  the  consideration  received  by the
Company  therefor  shall be deemed to be the amount of the cash  received by the
Company  therefor,  or, if such Additional  Shares of Common Stock,  warrants or
other  rights  or  Convertible   Securities  are  offered  by  the  Company  for
subscription,  the  subscription  price or, if such Additional  Shares of Common
Stock,  warrants  or  other  rights  or  Convertible   Securities  are  sold  to
underwriters or dealers for public offering without a subscription offering, the
initial public  offering  price,  in any such case excluding any amounts paid or
receivable for accrued  interest or accrued  dividends and without  deduction of
any compensation,  discounts or expenses paid or incurred by the Company for and
in the underwriting  of, or otherwise in connection with, the issuance  thereof.
If and to the extent that such issuance shall be for a consideration  other than
cash, then, except as herein otherwise  expressly  provided,  the amount of such
consideration  shall be deemed to be the fair value of such consideration at the
time of such issuance as determined by the Board of Directors of the Company. If
Additional  Shares  of  Common  Stock  shall be  issued  as part of a unit  with
warrants or other rights,  then the amount of  consideration  for the warrant or
other right shall be deemed to be the amount  determined at the time of issuance
by the Board of  Directors  of the  Company.  If the Board of  Directors  of the
Company shall not make any such determination, the consideration for the warrant
or other right shall be deemed to be zero.

     (x) In case the Company shall effect a reorganization,  shall merge with or
consolidate  into  another  corporation,  or shall sell,  transfer or  otherwise
dispose of all or  substantially  all of its  property,  assets or business and,
pursuant  to  the  terms  of  such  reorganization,   merger,  consolidation  or
disposition of assets,  shares of stock or other securities,  property or assets
of the Company,  successor or transferee or an affiliate  thereof or cash are to
be received by or distributed  to the holders of Common Stock,  then each holder
of Series A Stock shall be given a written  notice  from the  Company  informing
each  holder  of the terms of such  reorganization,  merger,  consolidation,  or
disposition  of assets  and of the record  date,  thereof  for any  distribution
pursuant  thereto,  at least ten days in advance of such record  date,  and each
holder of  Series A Stock  shall  have the right  thereafter  to  receive,  upon
conversion  of such  Series A Stock,  the  number  of  shares  of stock or other
securities,  property  or assets of the  Company,  successor  or  transferee  or
affiliate thereof or cash receivable upon or as a result of such reorganization,
merger,  consolidation  or  disposition  of assets by a holder of the  number of
shares of Common Stock equal to the Conversion  Rate  immediately  prior to such
event, multiplied by the number of shares of Series A Stock as may be converted.
The  provisions of this  subparagraph  (x) shall  similarly  apply to successive
reorganizations, mergers, consolidation or dispositions of assets.

     (xi) The Company may make such increases in the  conversion  rate, so as to
increase  the number of shares of Common Stock into which the Series A Stock may
be converted,  in addition to those required by subparagraphs  (i) - (v) and (x)
above,  as it  considers  to be  advisable  in order that any event  treated for
Federal  income tax purposes as a dividend of stock or stock rights shall not be
taxable to the recipients.

     (xii) The number of shares of Common  Stock  outstanding  at any given time
shall not include shares owned or held by or for the account of the Company, and
the  disposition  of such shares shall be  considered an issue or sale of Common
Stock for the purposes of this paragraph (e).

<PAGE>

     (xiii) If a state of facts shall occur which,  without  being  specifically
controlled by the  provisions of this paragraph (e), would not in the reasonable
opinion of the Board of Directors  fairly protect the  conversion  rights of the
Series A Stock in accordance  with the essential  intent and  principles of such
provision,  then the Board of Directors of the Company  shall make an adjustment
in the application of such provisions,  in accordance with such essential intent
and principles, so as to protect such conversion rights.

     (xiv) Anything herein to the contrary notwithstanding, no adjustment in the
Conversion  Rate shall be  required  unless  such  adjustment,  either by itself
orwith other  adjustments  not  previously  made,  would  require a change of at
least1% in such rate; provided,  however, that any adjustment which by reason of
this subparagraph  (xiv) is not required to be made shall be carried forward and
taken into account in any subsequent adjustment.

     (xv) All calculations under this paragraph (e) shall be made to the nearest
one-thousandth of a share.

     (xvi)  Whenever  the  Conversion  Rate shall be  adjusted  pursuant to this
paragraph (e), the Company shall  forthwith cause to be delivered to each holder
of  Series A Stock,  a notice  setting  forth in  reasonable  detail  the  event
requiring the adjustment and the method by which such  adjustment was calculated
(including  a  description  of the basis on which the Board of  Directors of the
Company determined the fair value of any consideration  other than cash pursuant
to subparagraph  (ix)) and specifying the new Conversion Rate,  accompanied by a
letter of a firm of independent  certified public  accountants (which may be the
regular auditors of the Company) of recognized national standing selected by the
Board of  Directors  of the  Company,  stating  that such firm has  reviewed the
relevant provisions of this paragraph 6 and the Company's calculation of the new
Conversion Rate. In the case referred to in subparagraph  (x), such notice shall
be issued  describing  the amount  and kind of stock,  securities,  property  or
assets or cash which shall be receivable  upon  conversion of the Series A Stock
after giving effect to the provision of such subparagraph (x).

     (xvii) The Company  shall  provide the holders of the Series A Stock prompt
notice ofany tender or exchange offer made to holders of the Common Stock to the
extent such offer is subject to the Securities Exchange Act of 1934, as amended,
and the rules and regulations thereunder.

                  (f) The Company shall at all times reserve and keep available,
free from preemptive rights, out of its authorized but unissued shares of Common
Stock,  solely for the purposes of effecting  the  conversion of Series A Stock,
the full number of shares of Common Stock then  deliverable  upon the conversion
of all shares of Series A Stock at the time outstanding.  The Company shall take
at all times  such  corporate  action as shall be  necessary  in order  that the
Company may validly and  legally  issue fully paid and  nonassessable  shares of
Common  Stock  upon the  conversion  of  Series A Stock in  accordance  with the
provision hereof,  free from all taxes,  liens,  charges and security  interests
with respect to the issue  thereof.  The Company will,  at its expense,  use its
best  efforts  to cause such  shares of Common  Stock to be listed  (subject  to
issuance  or notice of  issuance  on all stock  exchanges,  if any, on which the
Company's Common Stock may become listed.

                  (g) No fractional shares of Common Stock or scrip representing
fractional  shares of Common Stock shall be issued upon any conversion of Series
A Stock,  but, in lieu  thereof,  there shall be paid an amount in cash equal to
the same  fraction of the Market  Price of a whole share of Common  Stock on the
business day preceding the day of conversion.

<PAGE>

         7.       Definitions

                  (a) "Additional  Shares of Common Stock" shall mean all shares
of Common Stock of the Company  issued by the Company after the Effective  Time,
except (i) shares  which may be issued  pursuant to  conversion  of the Series A
Stock,  and  (ii)  shares  issued  upon  conversion  of  convertible  securities
outstanding on the date of issuance of the Series A Stock,  or upon the exercise
of  options  granted  or to be granted  with  respect  to up to  100,000  shares
pursuant to any stock option plan approved by the shareholders of the Company.

                  (b) "Conversion Amount" shall mean at any applicable date, the
amount equal to the quotient  resulting  from dividing  $15.45 by the Conversion
Rate in effect on such date for the Series A Stock.

                  (c) "Market Price" of a share of Common Stock on any day shall
mean the average closing price of a share of Common Stock for the 15 consecutive
trading days preceding such day on the principal national securities exchange on
which the shares of Common  Stock are listed or  admitted  to trading or, if not
listed or admitted to trading on any national securities  exchange,  the average
closing  price of a share of Common  Stock for the 15  consecutive  trading days
preceding such day on the  NASDAQ/National  Market Systems,  or if the shares of
Common Stock are not publicly traded, the Market Price for such day shall be the
Conversion Amount or the book value of a share of Common Stock of the Company as
disclosed in the last  balance  sheet of the Company  regularly  prepared by the
Company, whichever is higher.

         8. Stated Value. The entire consideration  received by the Company upon
issuance of the Series A Stock shall be allocated to capital surplus.

         9. Shares Surrendered. Any shares of Series A Stock redeemed, purchased
or otherwise  reacquired,  or surrendered  for conversion  shall be canceled and
restored to the status of authorized but unissued  shares of Preferred  Stock of
the Company, but shall not thereafter be issued as shares of Series A Stock.

         10.  Reports to Holders.  The Company shall  transmit to the holders of
the  Series  A  Stock  copies  of the  annual  reports  and of the  information,
documents  and other reports (or copies of such portions of any of the foregoing
as the  Securities  and Exchange  Commission  may from time to time by rules and
regulations  prescribe)  which  the  Company  may be  required  to file with the
Securities  and Exchange  Commission  pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934, as amended, including,  without limitation,
its  Annual  Reports to  Shareholders,  its  Annual  Reports  on Form 10-K,  its
Quarterly  Reports  on Form 10-Q and its  Current  Reports  on Form 8-K.  If the
Company is not required to file such  information  the Company shall transmit to
the  holders  of the  Series A Stock,  within 15 days  after it would  have been
required to file such information  with the Securities and Exchange  Commission,
financial statements,  including any notes thereto,  prepared in accordance with
generally accepted accounting  principles,  reasonably  comparable to that which
the  Company  would  have been  required  to  include  in such  annual  reports,
information,  documents  or other  reports if the  Company  were  subject to the
reporting requirements of the Securities Exchange Act of 1934, as amended.