EXHIBIT 10.20


                        THIRD CERTIFICATE OF DESIGNATION
                                       OF
                          TOP SOURCE TECHNOLOGIES, INC.


         Section 1.  Designation,  Number of Shares and Stated Value of Series B
Convertible,   Redeemable  Preferred  Stock.  There  is  hereby  authorized  and
established  a series of Preferred  Stock that shall be  designated  as Series B
Convertible,  Redeemable Preferred Stock ("Series B Preferred"),  and the number
of shares  constituting such Series shall be 3,500. Such number of shares may be
increased  or  decreased,  but not to a number less than the number of shares of
Series B Preferred  then issued and  outstanding,  by resolution  adopted by the
Board of Directors.  The Stated Value per share of the Series B Preferred  shall
be equal to $1,000.

Section 2.  Definitions.  In addition  to the  definitions  set forth  elsewhere
     herein, the following terms shall have the meanings indicated:

         "Business  Day" shall mean any day other than a  Saturday,  Sunday or a
day on which banking  institutions in Miami, Florida are authorized or obligated
by law or executive order to close.

         "Common Stock" shall mean the common stock, par value $0.001 per share,
of the Corporation.

         "Conversion  Price" shall mean the conversion price per share of Common
Stock into which the Series B Preferred is convertible, as such conversion price
may be adjusted pursuant to the provisions hereof. The Series B Preferred may be
convertible  into a number of shares of Common  Stock  computed by dividing  the
Stated Value of the Series B Preferred being converted by 90% of the closing bid
price for the  previous  trading  day and if the  conversion  occurs on or after
November 1, 1999, by 85% of the closing bid price for the previous trading day.

         "Corporation" shall mean Top Source Technologies, Inc.

         "Junior  Securities"  means the  Common  Stock and any other  series of
stock issued by the Corporation ranking junior as to the Series B Preferred upon
liquidation, dissolution or winding up of the Corporation.

         "Original Issue Date" shall mean the date on which shares of the Series
B Preferred are first issued.

         "Parity  Security"  means any  class or  series of stock  issued by the
Corporation  ranking on a parity with the Series B Preferred  upon  liquidation,
dissolution or winding up of the Corporation.

     "Person" means any individual, corporation, association, partnership, joint
venture,   limited  liability  company,   trust,  estate,  or  other  entity  or
organization, other than the Corporation, any subsidiary of the Corporation, any
employee  benefit plan of the Corporation or any subsidiary of the  Corporation,
or any entity holding shares of Common Stock for or pursuant to the terms of any
such plan.

         "Senior  Securities"  means any class or series of stock  issued by the
Corporation   ranking  senior  to  the  Series  B  Preferred  upon  liquidation,
dissolution or winding up of the Corporation.

         Section 3.        Dividends and Distributions.

         (a) The Series B  Preferred  shall rank prior to the Common  Stock with
respect to  dividends.  Dividends  shall be payable  quarterly,  when, as and if
declared  by the Board of  Directors,  on April 10,  July 10,  October  10,  and
January 10 in each year (each a "Dividend Payment Date") to holders of record as
of March 31, June 30,  September  30 and  December 31 in each year (the  "Record
Date").  Dividends  shall be paid in cash unless the Corporation is unable to do
so as a result of a restriction contained in a loan agreement or other financing
agreement entered into prior to or after the date of this Second  Certificate of
Designation  or if the agreement to pay cash or the payment of cash results in a
breach of any such agreement. In such case the Corporation shall issue shares of
its  Common  Stock in lieu of a cash  dividend.  The  number of shares of Common
Stock to be issued as a dividend shall be based upon the  Conversion  Price then
in  effect,  and the  previous  trading  day  shall  be  deemed  to be as of the
applicable  Record Date. Such number shall be increased by 25% and rounded up to
the nearest whole share. By way of example,  if a quarterly  dividend is $78,750
and the  Conversion  Price is $1.00,  98,438  shares of  Common  Stock  shall be
issued. The registration  rights contained in Section 4(c) of the Stock Purchase
Agreement  entered into between the Corporation  and the Wilmington  Trust Co. &
George Jeff Mennen, Co-Trustees shall apply to all shares of Common Stock issued
as dividends.

         (b) Dividends shall be calculated on the basis of the time elapsed from
and  including  the date of issuance of such shares to and  including the Record
Date or on any final  distribution  date relating to conversion or redemption or
to a  dissolution,  liquidation  or  winding  up of the  Corporation.  Dividends
payable on the shares of Series B  Preferred  for any period of less than a full
calendar  year shall be pro-rated for the partial year on the basis of a 360-day
year.

         (c) Dividends  payable on each  Dividend  Payment Date shall be paid to
record  holders of the shares of Series B Preferred  as they appear on the books
of the  Corporation  at the close of  business  on the  applicable  Record  Date
immediately  preceding  the  respective  Dividend  Payment Date or on such other
record  date as may be fixed by the Board of  Directors  of the  Corporation  in
advance of a Dividend  Payment Date,  provided that no such Record Date shall be
less than 10 nor more than 60 calendar  days  preceding  such  Dividend  Payment
Date.

         (d) So long as any shares of Series B  Preferred  are  outstanding,  no
dividend or other  distribution,  whether in liquidation or otherwise,  shall be
declared  or paid,  or set apart for  payment  on or in  respect  of, any Junior
Securities, nor shall any Junior Securities be redeemed,  purchased or otherwise
acquired  for any  consideration  (or any  money  be paid to a  sinking  fund or
otherwise  set  apart  for  the  purchase  or  redemption  of  any  such  Junior
Securities),  unless (i) all dividends have been paid on all outstanding  shares
of the Series B Preferred  shall have been paid or set apart for payment for all
past dividend  periods,  and (ii) sufficient funds shall have been set apart for
the payment of the dividend for the then current dividend period with respect to
the Series B Preferred.

         Section 4.        Certain Covenants and Restrictions.

         (a)      So long as any shares of Series B Preferred are outstanding.

                  (i) The  Corporation  shall  at all  times  reserve  and  keep
         available  for issuance  upon the  conversion of the shares of Series B
         Preferred such number of its  authorized but unissued  shares of Common
         Stock as will be sufficient to permit the conversion of all outstanding
         shares of Series B Preferred,  and all other securities and instruments
         convertible  into shares of Common Stock, and shall take all reasonable
         action within its power required to increase the  authorized  number of
         shares of Common Stock  necessary to permit the  conversion of all such
         shares of Series B Preferred and all other  securities and  instruments
         convertible into shares of Common Stock.

                  (ii) The Corporation represents,  warrants and agrees that all
         shares  of  Common  Stock  that  may be  issued  upon  exercise  of the
         conversion  rights of shares of Series B Preferred will, upon issuance,
         be fully-paid and non-assessable.

                  (iii) The  Corporation  will  endeavor  to make the  shares of
         stock that may be issued  upon  exercise  of the  conversion  rights of
         shares of Series B Preferred  eligible  for trading  upon any  national
         securities exchange,  or any automated quotation system of a registered
         securities association,  if any, upon or through which the Common Stock
         shall then be traded prior to such delivery.

                  (iv)  Prior  to the  delivery  of  any  securities  which  the
         Corporation shall be obligated to deliver upon redemption or conversion
         of the Series B Preferred, the Corporation will endeavor to comply with
         all  federal  and  state  securities  laws and  regulations  thereunder
         requiring the  registration of such securities with, or any approval of
         or consent to the  delivery  of such  securities  by, any  governmental
         authority.

                  (v) The Corporation shall pay all taxes and other governmental
         charges (other than any income or franchise  taxes) that may be imposed
         with  respect to the issue or delivery  of shares of Common  Stock upon
         conversion of Series B Preferred as provided  herein.  The  Corporation
         shall not be required,  however, to pay any tax or other charge imposed
         in  connection  with  any  transfer   involved  in  the  issue  of  any
         certificate  for shares of Common  Stock in any name other than that of
         the  registered  holder  of  the  shares  of  the  Series  B  Preferred
         surrendered in connection with the conversion thereof, and in such case
         the  Corporation  shall not be  required  to issue or deliver any stock
         certificate  until such tax or other  charge  has been paid,  or it has
         been established to the Corporation's satisfaction that no tax or other
         charge is due.

         (b) In the event the Corporation  proposes to offer,  sell or issue any
of  its  equity  securities  (including,   without  limitation,  shares  of  the
Corporation's capital stock or any rights to acquire such shares), excluding (i)
interests  issued  pursuant  to the  Corporation's  option  plans that have been
adopted  by  the  stockholders  of the  Corporation,  (ii)  securities  issuable
pursuant to a transaction governed by Rule 145 of the Securities Act of 1933, as
amended,  and (iii)  securities  issuable as  dividends  or upon the exercise or
conversion  of other  securities  outstanding  as of the  filing of this  Second
Certificate  of  Designation  with the  Delaware  Secretary  of State,  then the
holders  of shares of Series B  Preferred  shall  have the  preemptive  right to
acquire such securities from the Corporation.  In the event that the Corporation
proposes  to make any offer,  sale or issuance  that is subject to this  Section
4(b), then and in each such case the Corporation shall at least 15 days prior to
any such event (the "Window"), provide to the Series B Preferred holders written
notice of the  Corporation's  intention to take such  action.  Such notice shall
include the number and type of securities,  the price, the intended  transaction
date, and any other information  reasonably  requested by the Series B Preferred
holders.  Each Series B Preferred holder may exercise this preemptive  right, by
providing  written notice to the Corporation  within eight days (the "Response")
after receipt of the foregoing  notice from the  Corporation,  with respect to a
percentage  of the  securities  to be  offered,  sold or issued,  calculated  by
dividing (i) the number of shares of Common  Stock then  entitled to be received
upon the conversion of all shares of Series B Preferred held by such holder,  by
(ii) the total  number of shares of Common  Stock then  entitled  to be received
upon the conversion of all shares of Series B Preferred then outstanding. In the
event  any  holder(s)  shall  elect not to  exercise  the  preemptive  rights as
provided hereunder, then the aggregate shares otherwise entitled to be purchased
by such  non-participating  holders (the  "Non-Subscribed  Securities") shall be
available for purchase by each remaining  Series B Preferred  holder,  who shall
accordingly  receive  notice from the  Corporation of such  availability  within
three days after the expiration of the Response Date, in the proportion that the
number of shares of Common  Stock then  entitled  to be  received by such holder
upon  conversion  of its Series B Preferred  shares then held bears to the total
number shares of Common Stock then  entitled to be received  upon  conversion of
the Series B  Preferred  shares  held by all such  holders  electing to exercise
preemptive   rights.   The  preemptive  rights  to  acquire  the  Non-Subscribed
Securities  shall expire upon the  expiration  of the Window,  at which time the
Corporation may sell or issue any and all securities  regarding which the Series
B Preferred holders failed to exercise their preemptive rights hereunder.

         Section 5. Redemption of the Company.  The  Corporation  shall have the
option to redeem the Series B  Preferred  at 110% of Stated  Value plus  accrued
dividends  at any time on or  before  April  30,  1999 and at a price of 115% of
Stated Value plus accrued  dividends for a period of 180-days  commencing on May
1, 1999 and expiring at 6:00 p.m., Miami time on October 27, 1999.

         Section  6.  Reacquired  Shares.  Any  shares  of  Series  B  Preferred
repurchased,  redeemed, converted or otherwise acquired by the Corporation shall
be retired and canceled promptly after the acquisition  thereof. All such shares
shall upon their cancellation become authorized but unissued shares of Preferred
Stock, without designation as to series or class.

     Section 7. Voting  Rights.  Except as  otherwise  provided  in by law,  the
holders of the shares of Series B Preferred  shall not have the right to vote on
any matters that come before the stockholders of the Corporation.

     Section 8. Conversion Rights. Holders of shares of Series B Preferred shall
have the right to convert all or a portion of such shares into Common Stock,  as
follows:

         (a) Prior to  November  1, 1999,  the Series B  Preferred  shall not be
convertible without the express written consent of the Corporation.

         (b) Once convertible,  the Series B Preferred may be convertible into a
number of shares of Common  Stock  computed by dividing  the Stated Value of the
Series B Preferred  (including  accrued dividends) being converted by 90% of the
closing bid price for the previous  trading day and if the conversion  occurs on
or after November 1, 1999 by dividing the Stated Value of the Series B Preferred
(including  accrued  dividends)  being converted by 85% of the closing bid price
for the previous  trading day. The closing bid price shall be  determined by the
principal market for the Corporation's Common Stock.

         (c)  Fractional  shares shall not be issued and the  Corporation  shall
issue cash for any fractional shares.

         (d) The  conversion  of any share of Series B Preferred may be effected
by the holder  thereof  by the  surrender  of the  certificate  or  certificates
therefor,  duly endorsed, at the principal offices of the Corporation or to such
agent  or  agents  of the  Corporation  as may be  designated  by the  Board  of
Directors  and by filing  written  notice to the  Corporation  that such  holder
elects to convert the same.

         (e) As promptly as practicable  after the surrender of shares of Series
B Preferred for conversion,  the Corporation shall issue and deliver or cause to
be issued and delivered to the holder of such shares  certificates  representing
the number of fully  paid and  non-assessable  share of Common  Stock into which
such shares of Series B Preferred  has been  converted  in  accordance  with the
provisions  of this  Section 8.  Subject  to the  following  provisions  of this
Section 8(f), such conversion  shall be deemed to have been made as of the close
of  business  on the date on which the shares of Series B  Preferred  shall have
been  surrendered  for  conversion  in the manner herein  provided,  so that the
rights of the holder of the shares of Series B Preferred  so  surrendered  shall
cease at such time, and the person or persons  entitled to receive the shares of
Common Stock upon conversion thereof shall be treated for all purposed as having
become the record holder or holders thereof for all purposes,  at the opening of
business on the next succeeding day on which such transfer books are open.

     Section 9. Record  Holders.  The  Corporation may deem and treat the record
holder of any shares of Series B Preferred as the true and lawful owner  thereof
for all purposes, and the Corporation shall not be affected by any notice to the
contrary.

         Section  10.  Notice.  Except as may  otherwise  be  provided by law or
provided for herein, all notices referred to herein shall be in writing, and all
notices  hereunder shall be deemed to have been given upon receipt,  in the case
of a notice of conversion given to the Corporation, or, in all other cases, upon
the earlier of receipt of such notice or two Business Days after the delivery by
overnight  courier addressed if to the Corporation,  to its principal  executive
offices or to any agent of the Corporation designated as permitted hereby, or if
to a holder of the Series B  Preferred,  to such  holder at the  address of such
holder of the  Series B  Preferred  as listed in the stock  record  books of the
Corporation,  or to such other address as the Corporation or holder, as the case
may be, shall have designated by notice similarly given.

         Section 11.  Successors and Transferees.  The provisions  applicable to
shares of Series B  Preferred  shall  bind and  inure to the  benefit  of and be
enforceable by the  Corporation,  the respective  successors to the Corporation,
and by any record holder of shares of Series B Preferred.

         IN  WITNESS  WHEREOF,  the  undersigned  has signed  and  executed  the
foregoing Second Certificate of Designation on this 17th day of November, 1998.

                            TOP SOURCE TECHNOLOGIES, INC.



                            By:_______________________________
                               William C. Willis, Jr., President