STANDARD MANAGEMENT CORPORATION

                 CERTIFICATE OF DESIGNATIONS, PREFERENCES
                    AND RIGHTS OF SERIES A CONVERTIBLE
                         REDEEMABLE PREFERRED STOCK


     1.     DESIGNATION,  NUMBER OF SHARES AND STATED VALUE OF THE SERIES A
PREFERRED STOCK.  There is  hereby  authorized  and  established a class of
preferred  stock  with  the  designation  ASeries A Convertible  Redeemable
Preferred Stock@ (the ASeries A Preferred Stock@).   The  number  of shares
constituting  the  Series  A  Preferred  Stock  shall be 130,000, par value
$100.00  per  share.  The AStated Value@ of the Series  A  Preferred  Stock
shall be $100.00 per share.

     2.   DIVIDENDS.  The holders of shares of the Series A Preferred Stock
shall be entitled  to  receive,  when,  as  and if declared by the Board of
Directors of the Corporation, out of the assets  of the Corporation legally
available therefor, dividends at an annual rate of $7.75 per share, payable
quarterly,  subject to appropriate adjustment in the  event  of  any  stock
split, reverse  stock  split  or  similar  transaction.  Dividends shall be
payable quarterly on the last day of each calendar  quarter  (commencing on
the  first  such  date occurring after the date of issuance of such  shares
[the "Issue Date"]).   to  shareholders  of record as provided herein.  All
dividend payments shall be made in lawful  money  of  the  United States of
America.  Dividends payable on any Series A Preferred Stock  for any period
less  than a full year shall be computed on the basis of the actual  number
of days elapsed over a 365-day year.

     3.   PREFERENCE  ON  LIQUIDATION.   In  the  event of any voluntary or
involuntary  liquidation,  dissolution or winding up  of  the  Corporation,
before  any  payment or distribution  of  the  assets  of  the  Corporation
(whether capital  or surplus), or proceeds thereof, shall be made to or set
apart for the holders  of shares of any Junior Stock (as defined in Section
10), the holders of shares  of  the  Series  A  Preferred  Stock  shall  be
entitled  to  receive  payment  equal to the Stated Value per share held by
them, plus an amount in cash equal  to all accumulated and unpaid dividends
thereon to the date of such payment,  whether  or  not declared, subject to
appropriate adjustment in the event of any stock split, reverse stock split
or similar transaction with respect to the Series A  Preferred  Stock.  If,
upon any voluntary or involuntary liquidation, dissolution or winding up of
the  Corporation,  the  assets  of  the  Corporation,  or proceeds thereof,
available  for  distribution  among  the  holders  of  shares of  Series  A
Preferred Stock and any Parity Stock (as defined in Section  10)  shall  be
insufficient  to  pay in full the respective preferential amounts on shares
of the Series A Preferred Stock and such Parity Stock, then such assets, or
the proceeds thereof,  shall  be  distributed among the holders of all such
stock ratably in accordance with the  respective  amounts  which  would  be
payable  on  such shares if all amounts which would be payable thereon were
paid in full.   After  payment  of  the  full  amount  of  the  liquidation
preference  to  which the holders of Series A Preferred Stock are entitled,
such holders will  not  be  entitled  to  any  further participation in any
distribution  of  assets  of the Corporation.  For  the  purposes  of  this
Section 2, neither the merger nor the consolidation of the Corporation into
or with another corporation,  nor  the merger or consolidation of any other
corporation  into  or  with  the  Corporation,   nor  the  voluntary  sale,
conveyance, exchange, transfer or other disposition  (for  cash,  shares of
stock,  securities or other consideration) of all or substantially all  the
property or assets of the Corporation, shall be deemed to be a voluntary or
involuntary liquidation, dissolution or winding up of the Corporation.

     4.   CONVERSION.

     (a)  Each  share  of the Series A Preferred Stock shall be convertible
at the option of the holder  thereof  into  fully  paid  and  nonassessable
shares of Common Stock of the Corporation.  The number of shares  of Common
Stock  deliverable  upon  conversion  of  a share of the Series A Preferred
Stock, adjusted as hereinafter provided, shall  be equal to a fraction, the
numerator of which is the Stated Value of such shares of Series A Preferred
Stock  plus  all  accumulated  and  unpaid  dividends  thereon,   and   the
denominator of which is $8.50, such fraction hereinafter referred to as the
AConversion Rate@.  The Conversion Rate shall be subject to adjustment from
time to time pursuant to paragraph (e) of this Section 3.

     (b)  Conversion of the Series A Preferred Stock may be effected by any
such  holder  upon the surrender to the Corporation at the principal office
of the Corporation  or  at  the  office  of  any  agent  or  agents  of the
Corporation,  as  may  be  designated  by  the  Board  of  Directors of the
Corporation, of the certificate for such shares of the Series  A  Preferred
Stock  to  be  converted accompanied by a written notice stating that  such
holder elects to  convert all or a specified whole number of such shares in
accordance with the provisions of this Section 3 and specifying the name in
which such holder wishes  the  certificate  or  certificates  for shares of
Common  Stock  to be issued.  In case such notice shall specify a  name  or
names other than that of such holder, such notice shall be accompanied by a
payment of all transfer taxes payable upon the issuance of shares of Common
Stock in such name  or names.  Other than such taxes, the Corporation shall
pay any and all issue  and  other taxes (other than taxes based or measured
on income) that may be payable  in  respect  of  any  issue  or delivery of
shares  of  Common  Stock  on  conversion  of the Series A Preferred  Stock
pursuant hereto.  As promptly as practicable,  and in any event within five
(5) Business Days (as defined in Section 10) after  the  surrender  of such
certificate or certificates and the receipt of such notice relating thereto
and, if applicable, payment of all transfer taxes (or the demonstration  to
the  satisfaction  of  the  Corporation that such taxes have been paid) the
Corporation  shall  deliver or  cause  to  be  delivered  (i)  certificates
representing the number  of  validly  issued,  fully paid and nonassessable
full  shares  of Common Stock to which the holder  of  the  shares  of  the
Series A Preferred Stock being converted shall be entitled and (ii) if less
than the full number of shares of the Series A Preferred Stock evidenced by
the  surrender certificate  or  certificates  is  being  converted,  a  new
certificate  or  certificates,  of  like  tenor,  for  the number of shares
evidenced by such surrendered certificate or certificates  less  the number
of  shares  being converted.  Such conversion shall be deemed to have  been
made at the close  of  business on the date of giving of such notice and of
such surrender of the certificate  or  certificates representing the shares
of the Series A Preferred Stock to be converted  so  that the rights of the
holder thereof as to the shares being converted shall  cease except for the
right  to  receive  shares of Common Stock and cash in lieu  of  fractional
shares in accordance  herewith,  and  the  person  entitled  to receive the
shares  of Common Stock shall be treated for all purposes as having  become
the record  holder  of  such  shares  of  Common  Stock  at such time.  The
Corporation shall not be required to convert, and no surrender of shares of
the Series A Preferred Stock shall be effective for that purpose, while the
transfer books of the Corporation for the Common Stock are  closed  for any
purpose  (but  not  for  any  period in excess of ten (10) days); PROVIDED,
HOWEVER, that the surrender of  shares  of the Series A Preferred Stock for
conversion during any period while such books  are  so  closed shall become
effective for conversion immediately upon the reopening of  such  books, as
if  the  conversion  had been made on the date such shares of the Series  A
Preferred Stock were surrendered.

     (c)  In connection  with  the  conversion  of  any  shares of Series A
Preferred Stock, no fractional shares of Common Stock shall  be issued, but
in lieu thereof the Corporation shall pay a cash adjustment in  respect  of
such  fractional  interest  in  an amount equal to such fractional interest
multiplied by the Market Price (as  defined  in  Section  10)  per share of
Common  Stock  on the Trading Day (as defined in Section 10) on which  such
shares of the Series  A  Preferred Stock are deemed to have been converted.
If more than one share of Series A Preferred Stock shall be surrendered for
conversion by the same holder  at  the same time, the number of full shares
of Common Stock issuable on conversion  thereof  shall  be  computed on the
basis  of  the  total  number  of  shares  of  Series A Preferred Stock  so
surrendered.

     (d)  The Corporation shall at all times reserve,  and  keep  available
for  issuance  upon  the  conversion  of the Series A Preferred Stock, such
number of its authorized but unissued shares  of  Common Stock as will from
time  to  time be sufficient to permit the conversion  of  all  outstanding
shares of the  Series A Preferred Stock, and shall take all action required
to increase the authorized number of shares of Common Stock if necessary to
permit the conversion  of  all outstanding shares of the Series A Preferred
Stock.





<PAGE>
     (e)  The Conversion Rate  shall  be subject to adjustment from time to
time as follows:

          (i) In case the Corporation shall  at  any  time  or from time to
     time after the Issue Date (A) pay a dividend or make a distribution on
     the outstanding shares of Common Stock in shares of Common  Stock, (B)
     subdivide  the  outstanding  shares  of Common Stock, (C) combine  the
     outstanding shares of Common Stock into  a smaller number of shares or
     (D) issue by reclassification of the shares of Common Stock any shares
     of capital stock of the Corporation, then,  and in each such case, the
     Conversion  Rate  in effect immediately prior to  such  event  or  the
     record date therefor,  whichever is earlier, shall be adjusted so that
     the holder of any shares  of  the  Series A Preferred Stock thereafter
     surrendered for conversion shall be  entitled to receive the number of
     shares of Common Stock or other securities  of  the  Corporation  that
     such  holder  would  have owned or have been entitled to receive after
     the happening of any of the events described above, had such shares of
     the  Series  A  Preferred   Stock   been  surrendered  for  conversion
     immediately prior to the happening of  such  event  or the record date
     therefor, whichever is earlier.  An adjustment made pursuant  to  this
     clause (i) shall become effective (A) in the case of any such dividend
     or distribution, immediately after the close of business on the record
     date  for  the  determination  of  holders  of  shares of Common Stock
     entitled to receive such dividend or distribution,  or (B) in the case
     of any such subdivision, reclassification or combination, at the close
     of  business  on  the  day  upon  which such corporate action  becomes
     effective.

          (ii) In case the Corporation shall  at  any  time or from time to
     time after the Issue Date declare, order, pay or make  a  dividend  or
     other distribution (including, without limitation, any distribution of
     stock  or  other  securities  or  property  or  rights  or warrants to
     subscribe for securities of the Corporation or any of its subsidiaries
     by  way  of dividend or spin-off) on the Common Stock other  than  (A)
     dividends or distributions payable in cash out of retained earnings of
     the Corporation  or (B) dividends or distributions of shares of Common
     Stock that are referred  to in clause (i) of this paragraph (e), then,
     and in each such case, the  Conversion  Rate shall be adjusted so that
     the holder of each share of Series A Preferred Stock shall be entitled
     to  receive, upon the conversion thereof,  the  number  of  shares  of
     Common  Stock  determined by multiplying (A) the applicable Conversion
     Rate on the day  immediately  prior  to  the record date fixed for the
     determination of stockholders entitled to  receive  said  dividend  or
     distribution  by  (B)  a fraction, the numerator of which shall be the
     Market Price per share of Common Stock for the twenty (20) consecutive
     Trading  Days  immediately   preceding   such  record  date,  and  the
     denominator of which shall be such Market  Price  per  share of Common
     Stock minus the Fair Market Value (as defined in Section 10) per share
     of Common Stock of such dividend or distribution as determined in good
     faith   by   the   Board   of  Directors  of  the  Corporation,  whose
     determination shall be conclusive  and  described in a statement to be
     mailed to each holder of shares of the Series  A  Preferred Stock.  An
     adjustment made pursuant to this clause (ii) shall  be  made  upon the
     opening  of  business  on  the next Business Day following the day  on
     which any such dividend or distribution is made and shall be effective
     retroactively, immediately after  the  close of business on the record
     date fixed for the determination of stockholders  entitled  to receive
     such dividend or distribution.

          (iii) In case the Corporation shall issue to all holders  of  the
     Common  Stock  rights, options or warrants entitling them to subscribe
     for or purchase, or issue to such holders securities convertible into,
     Common Stock at a price per share less than the Market Price per share
     of  Common  Stock   on  the  record  date  for  the  determination  of
     stockholders entitled  to  receive  such  rights, options, warrants or
     convertible securities, then, and in each such  case,  the  Conversion
     Rate  shall  be adjusted so that the holder of each share of Series  A
     Preferred Stock  shall  be  entitled  to  receive, upon the conversion
     thereof,  the  number  of  shares  of  Common  Stock   determined   by
     multiplying  (A) the applicable Conversion Rate on the day immediately
     prior to such  record  date  by (B) a fraction, the numerator of which
     shall be the number of shares  of  Common  Stock  outstanding  on such
     record  date  plus  the  number  of  additional shares of Common Stock
     offered  for subscription or purchase and  the  denominator  of  which
     shall be the  number  of  shares  of  Common Stock outstanding on such
     record  date  plus  the  number of shares of  Common  Stock  that  the
     aggregate offering price of the total number of shares of Common Stock
     so offered would purchase  at  such  Market  Price per share of Common
     Stock.  An adjustment made pursuant to this clause (iii) shall be made
     on the next Business Day following the date on which any such issuance
     is  made  and shall be effective retroactively immediately  after  the
     close of business  on  such date.  Upon the expiration of such rights,
     options or warrants, upon  such  convertible  securities ceasing to be
     convertible into Common Stock or upon the repurchase  or redemption of
     any thereof, the adjustment to the Conversion Rate which was made upon
     the issuance thereof, any subsequent adjustments based  thereon, shall
     be  recomputed to reflect the issuance of only the number  of  rights,
     options  or  warrants  to subscribe for or purchase only the number of
     shares of Common Stock as  to  which  such rights, options or warrants
     were actually exercised, or only the number  of shares of Common Stock
     which  were  actually  issued  upon  conversion  of  such  convertible
     securities,  as  the  case may be.  Notwithstanding anything  in  this
     clause (iii) to the contrary,  the  issuance  of  any shares of Common
     Stock or the granting of any options to acquire any  shares  of Common
     Stock  to  any  employee,  officer,  director  or  consultant  of  the
     Corporation  under  the Corporation's Second Amended and Restated 1992
     Stock Option Plan, or  such  other  employee  benefit  or stock option
     plans as may be approved by the Board of Directors of the Corporation,
     shall  not  be  deemed to constitute the issuance of rights,  options,
     warrants or convertible  securities  by  the Corporation to which this
     clause (iii) applies.

          (iv)  In  case  of  any  consolidation or  merger  to  which  the
     Corporation is a party (other than  a merger or consolidation in which
     the  Corporation  is the surviving or continuing  corporation  and  in
     which the Common Stock  outstanding immediately prior to the merger or
     consolidation remains unchanged), each share of the Series A Preferred
     Stock shall thereafter be  convertible  into  shares of stock or other
     securities or property into which a holder of Common Stock immediately
     prior to such merger, combination or reclassification  would have been
     entitled  upon such merger, combination or reclassification.   In  any
     such case,  appropriate  adjustment  (as  determined  by  the Board of
     Directors  in  good  faith)  shall  be made in the application of  the
     provisions herein set forth with respect  to  the rights and interests
     thereafter of the holders of Series A Preferred  Stock,  such that the
     provisions set forth herein shall thereafter be applicable,  as nearly
     as  reasonably  may  be,  in  relation  to any share of stock or other
     property thereafter issuable upon conversion.

          (v) No adjustment in the Conversion Rate shall be required unless
     such adjustment would require an adjustment  of  at  least one percent
     (1%)  in  such  Conversion  Rate  price; PROVIDED, HOWEVER,  that  any
     adjustment that pursuant to this clause (v) is not required to be made
     shall be carried forward and taken  into  account  in  any  subsequent
     adjustment.

     (f)  Upon  any adjustment of the Conversion Rate pursuant to paragraph
(e) of this Section  3,  the  Corporation, within thirty (30) calendar days
thereafter,  shall have on file  for  inspection  by  the  holders  of  the
Series A Preferred  Stock  a  certificate  of the Board of Directors of the
Corporation setting forth (i) the Conversion  Rate  after  such adjustment,
(ii)  the method of calculation and the facts upon which such  calculations
are based  and  (iii) the number of shares of Common Stock purchasable upon
conversion of a share of the Series A Preferred Stock after such adjustment
in the Conversion  Rate,  which certificate shall be conclusive evidence of
the correctness of the matters set forth therein.


     5.   REDEMPTION BY THE CORPORATION OF SERIES A PREFERRED STOCK.

          (a) OPTIONAL REDEMPTION.

               (i)  No  shares   of  Series  A  Preferred  Stock  shall  be
          redeemable by the Corporation prior to July 1, 1999 (the AInitial
          Redemption Date@),PROVIDED, HOWEVER, that if prior to the Initial
          Redemption Date the average  of  the closing prices of the Common
          Stock of the Corporation on NASDAQ as reported in the WALL STREET
          JOURNAL for any 10 trading days within  a  30 consecutive trading
          day period, equals or exceeds $10.29  per share  (the ATriggering
          Event@),  the  date  on  which the Triggering Event occurs  shall
          become the Initial Redemption Date.

               (ii) The Corporation  may,  at  the  option  of the Board of
          Directors  of  the  Corporation, at any time between the  Initial
          Redemption Date and the  Mandatory Redemption Date (the AOptional
          Redemption  Date@) redeem,  from  any  source  of  funds  legally
          available therefor,  all  shares  of the Series A Preferred Stock
          outstanding  on the Optional Redemption  Date  at  the  following
          redemption prices (the AOptional Redemption Price@) (expressed as
          percentages of  the  Stated  Value per share), if such redemption
          occurs during the twelve month  period  beginning  July  1 of the
          years indicated below:

          YEAR                               OPTIONAL REDEMPTION PRICE

           1999                                         105%
           2000                                         104%
           2001                                         103%
           2002                                         102%
           2003 and thereafter                          100%

     in  each  case  together  with  any  and  all  accumulated  and unpaid
     dividends  thereon  as  of  the  Optional Redemption Date.  Shares  of
     Series A Preferred Stock redeemed  pursuant  to  this  Section  4 (ii)
     shall be redeemed in accordance with Section 4 (iii).

               (iii) At least twenty (20) days and not more than sixty (60)
     days  prior  to  the  Optional  Redemption  Date,  written notice (the
     AOptional  Redemption  Notice@) shall be mailed, postage  prepaid,  to
     each holder of record of  the  Series  A  Preferred  Stock at the post
     office address last shown on the records of the Corporation  for  such
     holder.  The Optional Redemption Notice shall state:

               (1)                      that all the outstanding shares  of
                    Series A Preferred Stock are to be redeemed;

               (2)                      the  Optional  Redemption  Date and
                    the Optional Redemption Price; and

               (3)                      that the holder is to surrender  to
                    the  Corporation,  in  the  manner  and  at  the  place
                    designated, his certificate or certificate representing
                    the shares of Series A Preferred Stock to be redeemed.

          (i)                 On  or  before  the Optional Redemption Date,
               each holder of Series A Preferred  Stock  shall surrender to
               the Corporation the certificate or certificates representing
               the  shares of Series A Preferred Stock to be  redeemed,  in
               the manner  and  at  the  place  designated  in the Optional
               Redemption  notice,  and  thereupon the Optional  Redemption
               Price  for such shares shall  be  payable  in  cash  on  the
               Optional Redemption Date to the person whose name appears on
               such certificate  or  certificates as the owner thereof, and
               each surrendered certificate shall be cancelled and retired.

          (ii)                Unless  the   Corporation   defaults  in  the
               payment in full of the Optional Redemption Price,  dividends
               on the Series A Preferred Stock called for redemption  shall
               cease to accumulate on the Optional Redemption Date, and all
               rights  of  the  holders of such shares redeemed shall cease
               with respect thereto  on the Optional Redemption Date, other
               than  the right to receive  the  Optional  Redemption  Price
               without interest.

          (b)  MANDATORY REDEMPTION

               (i) The  Corporation  shall,  at  the Stated Value per share
     redeemed plus an amount equal to the accumulated  and unpaid dividends
     through  the  Mandatory  Redemption  Date  (the AMandatory  Redemption
     Price@), redeem, using any source of funds legally available therefor,
     all shares of Series A Preferred Stock outstanding  on  July  1,  2003
     (the AMandatory Redemption Date@).  The Mandatory Redemption  shall be
     carried  out  pursuant  to  the procedures for redemption set forth in
     Section  4(a)  above,  except  that   for   purposes  of  a  Mandatory
     Redemption, all references to Optional Redemption  Date  and  Optional
     Redemption  Price shall be deemed to be Mandatory Redemption Date  and
     Mandatory Redemption Price, respectively.  If the Mandatory Redemption
     Date is not a  Business  Day,  the  shares of Series A Preferred Stock
     outstanding  on the Redemption Date shall  be  redeemed  on  the  next
     Business Day thereafter.

               (ii)  If  there are insufficient legally available funds for
     redemption of all shares  of Series A Preferred Stock pursuant to this
     Section 5(b), the Corporation  shall redeem such lesser number of full
     shares of Series A Preferred Stock  on  a pro rata basis in proportion
     to  the  number of shares of Series A Preferred  Stock  held  by  each
     holder thereof,  to  the  extent  there  are  funds  legally available
     therefor, and shall redeem all or part of the remainder  of the shares
     of  Series  A  Preferred  Stock subject to redemption as soon  as  the
     Corporation has sufficient funds which are legally available therefor.
     If the redemption is delayed because of insufficient legally available
     funds, dividends shall continue  to  accrue  on  shares  of  Series  A
     Preferred  Stock  outstanding, and shall be added to and become a part
     of the Mandatory Redemption  Price of such shares, until the Mandatory
     Redemption Price for such shares is paid in full.

          (c)  DEPOSIT OF FUNDS.  The  Corporation's  obligation to provide
funds  upon redemption in accordance with this Section 4  shall  be  deemed
fulfilled  if,  on  or before the Optional Redemption Date or the Mandatory
Redemption Date, as applicable,  the Corporation shall irrevocably deposit,
with a bank or trust company or shall  otherwise  set  aside  or make other
reasonable  provision  for the payment of cash required to be made  by  the
Corporation  pursuant  to  this  Section  4.   Upon  such  a  deposit,  all
certificates representing  shares  of  Series  A  Preferred  Stock shall be
deemed  redeemed. Any interest accrued on such funds shall be paid  to  the
Corporation  from  time to time. Any funds unclaimed at the end of one year
from the Optional Redemption  Date  or  the  Mandatory  Redemption Date, as
applicable,  shall be repaid and released to the Corporation,  after  which
the holder or holders of such shares of Series A Preferred Stock called for
redemption shall look only to the Corporation for delivery of such funds.

     6.   REPURCHASE  UPON  CHANGE  OF CONTROL.  If a Change of Control (as
defined below) occurs, the Corporation shall offer to repurchase all of the
Series A Preferred Stock pursuant to  an  offer  (the  AChange  of  Control
Offer@)  at a purchase price equal to the Stated Value of such shares  plus
all accumulated  and  unpaid  dividends  thereon,  if  any,  to the date of
purchase.

     A  AChange  of  Control@ means the occurrence of any of the  following
events after the Issue  Date (i) any person or group (within the meaning of
Section 13(d) or Section  14(d)  of the Securities Exchange Act of 1934, as
amended (the AExchange Act@)), becomes  the  direct  or indirect beneficial
owner  of  shares of capital stock of the Corporation representing  greater
than 50% of  the combined voting power of all outstanding shares of capital
stock of the Corporation  entitled  to  vote  in  the election of directors
under  ordinary  circumstances;  (ii)  subject to certain  exceptions,  the
Corporation consolidates with or merges  into  any  other  entity  and  the
outstanding  Common  Stock is changed or exchanged as a result; (iii) sale,
transfer  or  other  disposition  of  a  majority  of  the  assets  of  the
Corporation  or  of the  collective  assets  of  the  Corporation  and  the
subsidiaries; (iv)  at any time the Continuing Directors (as defined below)
cease to constitute a majority of the Board of Directors of the Corporation
then in office; or (v) on any day the Corporation makes any distribution of
cash, property or securities  (other than regular dividends declared in the
ordinary  course, Common Stock,  preferred  stock  which  is  substantially
equivalent  to  Common Stock or rights to acquire Common Stock or preferred
stock which is substantially  equivalent  to  Common  Stock)  to holders of
Common  Stock,  or the Corporation or any of its subsidiaries purchases  or
otherwise acquires  Common  Stock,  and the sum of the Fair Market Value of
such cash, property or securities distributed  or Common Stock purchased on
the date the same is made, plus the Fair Market  Value,  when  made, of all
other  cash,  property  or  securities  so  distributed or Common Stock  so
purchased which have occurred during the 12 month period ending on the such
date, in each case expressed as a percentage  of the aggregate Market Price
of all of the shares of Common Stock outstanding  at  the close of business
on the last day prior to the day prior to the date of such  distribution of
purchase, exceeds 50%.  AContinuing Director@ means at any date a member of
the  Board  of  Directors of the Corporation (i) who was a member  of  such
Board on the Issue  Date  or  (ii) who was nominated or elected by at least
two-thirds of the directors who  were  Continuing  Directors at the time of
such nomination or election or whose election to the  Board of Directors of
the Corporation was recommended or endorsed by at least  two-thirds  of the
directors  who  were  Continuing  Directors  at  the time of such election.
Notwithstanding the foregoing, a Change of Control  under clause (ii) above
will not include any transaction or Series of related transactions in which
85% or more of the consideration received by the holders  of  the  Series A
Preferred Stock (assuming conversion of such shares immediately after  such
transaction)  consists  of  common  stock  that  is  listed  on  a national
securities  exchange  or  approved  for  quotation  on  the NASDAQ National
Market.

     Within 30 days after any Change of Control, unless the Corporation has
previously given a notice of optional redemption by the Corporation  of all
of the Series A Preferred Stock, the Corporation shall give a notice of the
Change  of Control Offer to each holder of the Series A Preferred Stock  at
such holder's  address  as  last  shown  on  the records of the Corporation
stating: (i) that a Change of Control has occurred and that the Corporation
is offering to repurchase all of holder's Series  A Preferred Stock; (ii) a
brief  description of such Change of Control; (iii)  the  repurchase  price
(the AChange  of  Control Payment@); (iv) the expiration date of the Change
of Control Offer, which  shall be no earlier than 30 days nor later than 60
days from the date such notice  is mailed; (v) the date such purchase shall
be effected, which shall be no later  than 30 days after expiration date of
the Change of Control Offer; (vi) a statement  that  any shares of Series A
Preferred Stock not accepted for payment pursuant to the  Change of Control
Offer shall continue to accrue dividends; (vii) a statement that unless the
Corporation defaults in the payment of the Change of Control  Payment,  all
shares  of  Series  A  Preferred Stock accepted for payment pursuant to the
Change of Control Offer shall cease to accrue dividends after the Change of
Control Payment Date; (viii)  the  name  and  address  of the paying agent;
(ix)  a  statement  that  shares  of  Series  A  Preferred  Stock  must  be
surrendered  to the paying agent to collect the Change of Control  Payment;
and (x) any other  information  required  by  applicable law to be included
therein.

     In the event that the Corporation is required  to  make  a  Change  of
Control  Offer,  the Corporation will comply with any applicable securities
laws and regulations, including, to the extent applicable, Section 14(e) of
and Rule 14e-1 and any other tender offer rules under the Exchange Act.

     7.   VOTING RIGHTS.   The  holders  of  the  Series A Preferred Stock,
except as required by law or any provision of the Articles of Incorporation
for  the Corporation, shall not be entitled or permitted  to  vote  on  any
matter  required  or  permitted to be voted upon by the stockholders of the
Corporation.

     8.   CERTAIN RESTRICTIONS.

          (a)  Whenever  the  Corporation  shall fail to redeem in full all
outstanding shares of Series A Preferred Stock  on the Mandatory Redemption
Date for the Mandatory Redemption Price thereof as  provided  in Section 4,
thereafter  and  until  all  shares  of  the  Series A Preferred Stock  are
redeemed  in  full  for  the  Mandatory  Redemption  Price   thereof,   the
Corporation shall not:  (i) declare or pay any dividends, or make any other
distributions  on,  any  shares  of  Junior Stock (as hereinafter defined),
other than dividends or distributions payable in Junior Stock, (ii) declare
or pay any dividends, or make any other  distributions,  on  any  share  of
Parity  Stock,  except  dividends  or  distributions  paid  ratably  on the
Series  A  Preferred  Stock  and  all  Parity  Stock on which dividends are
payable  or in arrears, in proportion to the total  amounts  to  which  the
holders of all shares of the Series A Preferred Stock and such Parity Stock
are then entitled  or  (iii)  redeem,  purchase  or  otherwise  acquire for
consideration any shares of Junior Stock or Parity Stock.

          (b)  The  Corporation  shall  not  permit  any subsidiary of  the
Corporation to purchase or otherwise acquire for consideration  any  shares
of  capital stock of the Corporation unless the Corporation could, pursuant
to paragraph  (a)  of this Section 7, purchase such shares at such time and
in such manner.

      9.    REGISTRATION RIGHTS.

          (a)  At any  time  after July 1, 1999, the holders of 51% or more
of the shares of Series A Preferred Stock may demand registration under the
Securities Act of 1933, as amended  (the  ASecurities  Act@)  of all or any
portion of the Common Stock into which the Series A Preferred Stock  can be
converted and shares of Common Stock distributed as dividends on or through
the  conversion the Series A Preferred Stock (collectively, the "Restricted
Securities").  Upon such demand, the Corporation will prepare and file with
the Securities  and Exchange Commission (ASEC@) a registration statement (a
ARegistration Statement@)  and  use  its  best  efforts to cause the SEC to
declare the Registration Statement effective under the Securities Act.  The
Corporation  will, in the event a Registration Statement  is  filed,  among
other things,  provide  to each holder for whom such Registration Statement
was filed, copies of the  prospectus  which  is  a part of the Registration
Statement,  notify  each  such holder when the Registration  Statement  has
become effective and take certain  other  actions as are required to permit
unrestricted resales of such Restricted Securities.   A holder selling such
securities  pursuant  to  the  Registration  Statement generally  would  be
required to be named as a selling security holder in the related prospectus
and to deliver a prospectus to purchasers, and  will  be subject to certain
of the civil liability provisions under the Securities  Act  in  connection
with such sales.  All costs incurred in connection with the filing  of  the
Registration  Statement  shall be borne by the Corporation, except that the
underwriting commissions shall  be paid by the holders in proportion to any
Restricted Securities to be included on their behalf.

          (b)  If, but without any  obligation  to  do  so, the Corporation
proposes  to register any of its Common Stock under the Securities  Act  in
connection  with  the  public  offering  of such securities (other than the
registration of securities to be offered pursuant  to  an  employee benefit
plan  on  Form  S-8,  a registration made on Form S-4, or on any  successor
forms then in effect) the  Corporation  shall,  at such time, promptly give
the holders of shares of Series A Preferred Stock  written  notice  of such
registration.   Upon  the  written  request of any such holder given within
twenty (20) days after receipt of such  notice, the Corporation shall cause
to be registered under the Securities Act  all of the Restricted Securities
that  such  holder  has  requested  to  be  registered.   Except  that  the
underwriting commissions shall be paid by the  holders in proportion to any
Restricted Securities to be included on their behalf, the Corporation shall
bear  and pay all expenses incurred in connection  with  any  registration,
filing  or  qualification  of  Restricted  Securities  with  respect to the
registrations pursuant to this Section 8(b).

     10.  REISSUANCE OF SHARES OF SERIES A PREFERRED STOCK.  Any  shares of
Series  A  Preferred  Stock  that  have been issued and have been redeemed,
repurchased or reacquired in any manner  by  the Corporation shall have the
status of authorized and unissued shares of preferred  stock,  undesignated
as  to  class,  and  may thereafter be reissued as part of a new class,  as
permitted by law.

     11.  DEFINITIONS.   For the purposes of this Amendment to the Articles
of Incorporation, the following terms shall have the meanings indicated:

     ABusiness Day@ means  any  day that is not a Saturday or a Sunday or a
day on which banking institutions in the State of Indiana are authorized by
law or executive order to close.

     AFair Market Value@ shall mean  the  amount that a willing buyer would
pay a willing seller in an arm's length transaction.

     AJunior Stock@ shall mean any capital stock of the Corporation ranking
junior (either as to dividends or upon liquidation,  dissolution or winding
up) to the Series A Preferred Stock.  Junior Stock shall include the Common
Stock.

     AMarket Price@, when used with reference to shares  of Common Stock or
other  securities on any date, shall mean the closing price  per  share  of
Common Stock  or  such  other  securities on such date or, if such price is
determined over a period, the average of the daily closing prices per share
of  Common  Stock  or  such other securities  for  such  period;  PROVIDED,
HOWEVER, that in the event  that  the  Market  Price is determined during a
period following the ex-dividend date or the record date in connection with
an event triggering an adjustment pursuant to Sections 3 (e) (ii) and (iii)
hereof,  then,  and  in  each  such  case,  the  Market   Price   shall  be
appropriately  adjusted  to reflect the ex-dividend Market Price per  share
equivalent of the Common Stock.   The  closing  price for each day shall be
the last sale price, regular way, or, in case no  such  sale takes place on
such day, the average of the closing bid and asked prices,  regular way, in
either case as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading  on the New
York  Stock  Exchange or, if the Common Stock or such other securities  are
not listed or  admitted  to  trading  on  the  New  York Stock Exchange, as
reported  in the principal consolidated transaction reporting  system  with
respect to  securities listed on the principal national securities exchange
on which the  Common  Stock or such other securities are listed or admitted
to trading or, if the Common  Stock is not listed or admitted to trading on
any national securities exchange,  the last quoted sale price or, if not so
quoted, the average of the high bid  and  low asked prices in the over-the-
counter  market,  as  reported by the National  Association  of  Securities
Dealers, Inc.  Automated Quotation System or such other system then in use,
or, if on any such date  the  Common Stock or such other securities are not
quoted by any such organization,  the  average of the closing bid and asked
prices as furnished by a professional market  maker  making a market in the
Common Stock or such other securities selected by the Board of Directors of
the  Corporation.   If  the Common Stock or such other securities  are  not
publicly held or so listed  or  publicly  traded, AMarket Price@ shall mean
the Fair Market Value per share of Common Stock or of such other securities
as determined in good faith by the Board of Directors of the Corporation.

     AParity Stock@ shall mean any capital stock of the Corporation ranking
on  a parity (either as to dividends or upon  liquidation,  dissolution  or
winding  up)  with  the  Series  A Preferred Stock.  Parity Stock shall not
include the Common Stock.

     ATrading Day@ means a day on  which  the principal national securities
exchange on which the Common Stock is listed or admitted to trading is open
for the transaction of business or, if the  Common  Stock  is not listed or
admitted to trading on any national securities exchange, a Business Day.

     12.  SEVERABILITY   OF  PROVISIONS.   If  any  right,  preference   or
limitation of the Series A  Preferred  Stock  set  forth  herein  is deemed
invalid,  unlawful or incapable or being enforced by reason of any rule  of
law or public  policy,  such  right,  preference  or  limitation  shall  be
enforced  to  the  maximum  extent  permitted  by law and all other rights,
preferences and limitations set forth herein, which  can  be  given  effect
without  the  invalid,  unlawful  or  unenforceable  right,  preference  or
limitation  shall,  nevertheless,  remain  in full force and effect, and no
right, preference or limitation herein set forth  shall be deemed dependent
upon  any other such right, preference or limitation  unless  so  expressed
herein.

     13.  REPORTS.   So  long  as  any  of  the Series A Preferred Stock is
outstanding,  the Corporation will furnish the  holders  thereof  with  any
annual financial statements regularly prepared by or for the Corporation.

     14.  HEADINGS.    The   headings   of  the  sections  herein  are  for
convenience of reference only and shall not  affect  the  interpretation of
any of the provisions hereof.


















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