CERTIFICATE OF DESIGNATIONS,
                             PREFERENCES AND RIGHTS

                                       of

                      SERIES M1 CONVERTIBLE PREFERRED STOCK

                                       of

                                   TREEV, INC.

                         (Pursuant to Section 151 of the
                        Delaware General Corporation Law)




         TREEV, Inc., a corporation organized and existing under the laws of the
State of Delaware  (the  "Corporation"),  hereby  certifies  that the  following
resolutions  were adopted by the Board of Directors of the Corporation  pursuant
to  authority  of the Board of  Directors  as  required  by  Section  151 of the
Delaware General Corporation Law.

         RESOLVED,  that pursuant to the authority  granted to and vested in the
Board of Directors of this Corporation (the "Board of Directors" or the "Board")
in  accordance  with the  provisions of its  Certificate  of  Incorporation  and
Bylaws,  each as amended  and  restated  through the date  hereof,  the Board of
Directors hereby authorizes a series of the Corporation's  previously authorized
Preferred Stock, par value $.0001 per share (the "Preferred Stock"),  and hereby
states the  designation  and number of shares,  and fixes the  relative  rights,
preferences, privileges, powers and restrictions thereof as follows:

         Series M1 Convertible Preferred Stock:


                            I. DESIGNATION AND AMOUNT

         The  designation  of this  series,  which  consists of 1,000  shares of
Preferred  Stock,  is the Series M1 Convertible  Preferred Stock (the "Series M1
Preferred  Stock")  and the face  amount  shall  be One  Thousand  U.S.  Dollars
($1,000.00) per share (the "Face  Amount").  The Holder will be issued shares of
the Series M1 Preferred Stock in denominations of 100 shares. No other Series M1
Preferred  Stock  shall be issued  without  the  consent  of Fred  Kassner  (the
"Holder").



                                II. NO DIVIDENDS

         The Series M1 Preferred  Stock will bear no dividends,  and the holders
of the Series M1 Preferred  Stock shall not be entitled to receive  dividends on
the Series M1 Preferred Stock.


                            III. CERTAIN DEFINITIONS

         For purposes of this  Certificate of  Designation,  the following terms
shall have the following meanings:

         A.  "Conversion  Date"  means,  for any Optional  Conversion,  the date
specified in the notice of conversion  in the form attached  hereto (the "Notice
of  Conversion"),  so long as the copy of the Notice of  Conversion is faxed (or
delivered  by  other  means  resulting  in  notice)  to the  Corporation  before
Midnight,  New York City time, on the Conversion Date indicated in the Notice of
Conversion.  If the Notice of Conversion is not so faxed or otherwise  delivered
before such time, then the Conversion Date shall be the date the holder faxes or
otherwise  delivers the Notice of Conversion to the Corporation.  The Conversion
Date for the Required Conversion at Maturity shall be the Maturity Date (as such
terms are defined in Paragraph D of Article IV).

         B. "Conversion Price" means a price equal to $.8125 per share of Common
Stock.

         C. "N"  means the  number  of days  from,  but  excluding,  the date of
original issuance of such share of Series M1 Preferred Stock.

         D. "Premium" means an amount equal to (.0850) x(N/365)x(1,000).


                                 IV. CONVERSION

          A.  Conversion  at  the  Option  of the  Holder.  (i)  Subject  to the
limitations  on  conversions  contained  in Paragraph C of this Article IV, each
holder of shares of Series M1 Preferred  Stock may, at any time and from time to
time,  convert  (an  "Optional  Conversion")  each of its  shares  of  Series M1
Preferred Stock into a number of fully paid and  nonassessable  shares of Common
Stock at $.8125 per share if the Corporation  timely redeems the Premium thereon
in cash or Common Stock,  at the sole option of the Company.  Each 100 shares of
the Series M1  Preferred  Stock is  convertible  into  123,070  shares of Common
Stock. The Premium, if paid in Common Stock, shall be determined by dividing the
total amount of the accrued  Premium as of the date the Notice of  Conversion is
received by 95% of the bid price for the Common Stock as of that date.

 (ii) (a) The  Corporation  shall have the right, in its sole  discretion,  upon
      receipt of a Notice of Conversion or in the event of a Required Conversion
      at  Maturity,  to  redeem  any  portion  of the  Premium  subject  to such
      conversion  for a sum of cash or Common  Stock,  at the sole option of the
      Company,  equal to the amount of the  Premium  being so  redeemed.  In the
      event that the Corporation  elects to pay the Premium in Common Stock, the
      number of shares of Common Stock issued shall be equal to the total dollar
      amount of the Premium divided by 95% of the then-current bid price for the
      Common Stock on that date the Notice of Conversion  is received.  All cash
      redemption  payments hereunder shall be paid in lawful money of the United
      States of America at such  address for the holder as appears on the record
      books of the  Corporation  (or at such other  address as such holder shall
      hereafter give to the Corporation by written notice).

         B. Mechanics of Conversion.  In order to effect an Optional Conversion,
a holder  shall:  (x) fax (or  otherwise  deliver) a copy of the fully  executed
Notice of Conversion  to the  Corporation  or the transfer  agent for the Common
Stock and (y)  surrender or cause to be  surrendered  the original  certificates
representing the Series M1 Preferred Stock being converted (the "Preferred Stock
Certificates"),  duly endorsed, along with a copy of the Notice of Conversion as
soon as practicable  thereafter to the Corporation or the transfer  agent.  Upon
receipt by the  Corporation of a facsimile copy of a Notice of Conversion from a
holder, the Corporation shall immediately send, via facsimile, a confirmation to
such holder stating that the Notice of Conversion  has been  received,  the date
upon which the  Corporation  expects to deliver the Common Stock  issuable  upon
such  conversion  and the name and telephone  number of a contact  person at the
Corporation regarding the conversion.  The Corporation shall not be obligated to
issue shares of Common Stock upon a conversion unless either the Preferred Stock
Certificates  are delivered to the Corporation or the transfer agent as provided
above,  or the holder  notifies the  Corporation or the transfer agent that such
certificates have been lost, stolen or destroyed (subject to the requirements of
Article XII.B).

                  (i)  Delivery  of  Common  Stock  Upon  Conversion.  Upon  the
surrender of Preferred Stock  Certificates  from a holder of Series M1 Preferred
Stock  accompanied by a Notice of Conversion,  the  Corporation  shall, no later
than the second  business day following the later of (a) the Conversion Date and
(b) the date of such  surrender  (or, in the case of lost,  stolen or  destroyed
certificates,  after  provision  of  indemnity  pursuant to Article  XII.B) (the
"Delivery Period"), issue and deliver to the holder (x) that number of shares of
Common  Stock  issuable  upon  conversion  of such shares of Series M1 Preferred
Stock being converted and (y) a certificate representing the number of shares of
Series M1 Preferred  Stock not being  converted,  if any. In lieu of  delivering
physical  certificates  representing  the Common Stock issuable upon conversion,
provided the Borrower's  transfer agent is participating in the Depository Trust
Company ("DTC") Fast Automated Securities Transfer program,  upon request of the
holder and its compliance with the provisions  contained in this  paragraph,  so
long as the certificates therefor do not bear a legend and the holder thereof is
not obligated to return such  certificate for the placement of a legend thereon,
the  Corporation  shall  use its best  efforts  to cause its  transfer  agent to
electronically  transmit the Common Stock issuable upon conversion to the holder
by crediting  the account of holder's  Prime Broker with DTC through its Deposit
Withdrawal Agent Commission system.

                  (ii) Taxes.  The  Corporation  shall pay any and all taxes and
all other  reasonable  expenses which may be imposed upon it with respect to the
issuance and delivery of the shares of Common Stock upon the  conversion  of the
Series M1 Preferred Stock.

                  (iii) No  Fractional  Shares.  If any  conversion of Series M1
Preferred  Stock would result in the  issuance of a  fractional  share of Common
Stock,  such  fractional  share shall be disregarded and the number of shares of
Common Stock issuable upon  conversion of the Series M1 Preferred Stock shall be
the next higher whole number of shares.

                  (iv)  Conversion  Disputes.  In the case of any  dispute  with
respect to a conversion,  the  Corporation  shall  promptly issue such number of
shares of Common Stock as are not disputed in accordance with  subparagraph  (i)
above.  If such dispute  involves the calculation of the Conversion  Price,  the
Corporation shall submit the disputed calculations to its outside accountant via
facsimile  within two (2) business days of receipt of the Notice of  Conversion.
The accountant  shall audit the  calculations and notify the Corporation and the
holder  of the  results  no later  than two (2)  business  days from the date it
receives the disputed calculations. The accountant's calculation shall be deemed
conclusive,  absent  manifest  error.  The  Corporation  shall  then  issue  the
appropriate number of shares of Common Stock in accordance with subparagraph (i)
above.

         C. Required Conversion at Maturity. Provided all shares of Common Stock
issuable upon conversion of all outstanding  shares of Series M1 Preferred Stock
are then (i) authorized  and reserved for issuance,  (ii)  registered  under the
Securities  Act of 1933,  as amended  (the  "Securities  Act") for resale by the
holders of such  shares of Series M1  Preferred  Stock and (iii)  eligible to be
traded on either the Nasdaq,  the New York Stock  Exchange or the American Stock
Exchange,  each share of Series M1 Preferred Stock issued and outstanding on the
fourth  anniversary of the execution date (the "Maturity  Date"),  automatically
shall be converted  into shares of Common Stock on such date in accordance  with
the  conversion  rate set forth in Paragraph A of this Article IV (the "Required
Conversion at Maturity").  If the Required  Conversion at Maturity  occurs,  the
Corporation  and the  holders  of Series M1  Preferred  Stock  shall  follow the
applicable  conversion  procedures  set forth in Paragraph B of this Article IV;
provided,  however,  that the  holders  of  Series  M1  Preferred  Stock are not
required to deliver a Notice of  Conversion to the  Corporation  or its transfer
agent.


                    V. RESERVATION OF SHARES OF COMMON STOCK

         Upon the initial  issuance of the shares of Series M1 Preferred  Stock,
the Corporation  shall reserve  1,730,769  shares of the authorized but unissued
shares of Common Stock for issuance  upon  conversion of the Series M1 Preferred
Stock and  thereafter  the number of  authorized  but unissued  shares of Common
Stock so reserved (the  "Reserved  Amount")  shall not be decreased and shall at
all times be sufficient to provide for the conversion of the Series M1 Preferred
Stock outstanding at the then current Conversion Price.


                      VI. REDEMPTION DUE TO CERTAIN EVENTS

         A. Redemption by Holder.  In the event (each of the events described in
clauses  (i)-(v) below after  expiration of the applicable  cure period (if any)
being a "Redemption Event"):

                   (i) the  Corporation  fails,  and any such failure  continues
uncured  for five (5)  business  days after the  Corporation  has been  notified
thereof in  writing  by the  holder,  to remove  any  restrictive  legend on any
certificate  or any shares of Common  Stock  issued to the  holders of Series M1
Preferred  Stock upon  conversion  of the Series M1 Preferred  Stock as and when
required by the Securities Purchase Agreement;

                  (ii) the  Corporation  provides notice to any holder of Series
M1 Preferred Stock, including by way of public announcement, at any time, of its
intention  not to issue  shares  of  Common  Stock to any  holder  of  Series M1
Preferred Stock upon conversion in accordance with the terms of this Certificate
of Designation  (other than due to the circumstances  contemplated by Articles V
or VII for  which  the  holders  shall  have  the  remedies  set  forth  in such
Articles);

                  (iii) the Corporation shall:

                           (a) sell, convey or  dispose  of all or substantially
all of its assets;

                           (b) merge, consolidate or  engage  in any other busi-
ness combination with any other  entity  (other  than  pursuant  to a  migratory
merger  effected  solely for the purpose of changing the  jurisdiction of incor-
poration of the Corporation); or

                           (c) have approved, recommended or otherwise consented
to any  transaction  or series of  related  transactions  which  result in fifty
percent  (50%)  or  more  of  the  voting  power  of  its  capital  stock  owned
beneficially  by one  person,  entity or  "group"  (as such  term is used  under
Section 13(d) of the Securities Exchange Act of 1934, as amended);

then, upon the occurrence of any such Redemption Event, each holder of shares of
Series M1 Preferred Stock shall thereafter have the option, exercisable in whole
or in part at any time and from time to time by delivery of a Redemption  Notice
(as defined in Paragraph C below) to the Corporation while such Redemption Event
continues,  to require the  Corporation  to purchase  for cash any or all of the
then outstanding  shares of Series M1 Preferred Stock held by such holder for an
amount per share  equal to the  Redemption  Amount (as  defined in  Paragraph  B
below) in effect at the time of the redemption hereunder.

         B.  Definition  of  Redemption  Amount.  The  "Redemption  Amount" with
respect to a share of Series M1 Preferred Stock means an amount equal to:

                      V        X       M
                  ----------
                     C P

where:

         "V" means the face amount thereof plus the accrued  Premium thereon and
all Conversion  Default  Payments (if any) with respect thereto through the date
of redemption;

         "CP" means $.8125; and

         "M" means the highest Closing Price of the  Corporation's  Common Stock
during the period  beginning on the date of the Redemption  Notice and ending on
the date of the redemption.

         C. Redemption Defaults.  If the Corporation fails to pay any holder the
Redemption  Amount with respect to any share of Series M1 Preferred Stock within
ten (10) business days of its receipt of a notice  requiring such  redemption (a
"Redemption  Notice"),  then the holder of Series M1 Preferred Stock  delivering
such  Redemption  Notice (i) shall be entitled  to  interest  on the  Redemption
Amount at a per annum  rate equal to the lower of twelve  percent  (12%) and the
highest  interest  rate  permitted  by  applicable  law  from  the  date  of the
Redemption  Notice until the date of redemption  hereunder,  and (ii) shall have
the right, at any time and from time to time, to require the  Corporation,  upon
written  notice,  to  immediately  convert  (in  accordance  with  the  terms of
Paragraph  A of Article IV) all or any portion of the  Redemption  Amount,  plus
interest as aforesaid, into shares of Common Stock at the Conversion Price.

         D.       Redemption by Corporation.

(i) The  Corporation  shall  have  the  right,  at any  time  and  provided  the
Corporation is not in material  violation of any of its  obligations  under this
Certificate of Designation  or the Securities  Purchase  Agreement to redeem (an
"Optional  Redemption")  all  (but not less  than  all) of the then  outstanding
Series M1 Preferred  Stock  (other than Series M1  Preferred  Stock which is the
subject of a Notice of  Conversion  delivered  prior to the delivery date of the
Optional  Redemption  Notice)  for a  price  per  share  equal  to the  Optional
Redemption  Amount (as defined below) which right shall be exercisable  only one
time while any Series M1 Preferred  Stock is outstanding  by the  Corporation in
its sole discretion by delivery of an Optional  Redemption  Notice in accordance
with the redemption  procedures set forth below.  Holders of Series M1 Preferred
Stock may not  convert  any shares of Series M1  Preferred  Stock  selected  for
redemption  hereunder into Common Stock at any time or on prior to the Effective
Date of Redemption  designated  by the  Corporation  in the Optional  Redemption
Notice.   The  "Optional   Redemption   Amount"  with  respect  to  all  of  the
then-outstanding  shares of the Series M1 Preferred  Stock shall be equal to (i)
the  combined  Face  Amount of those  outstanding  shares  plus (ii) the accrued
Premium thereon.

                                    VII. RANK

         All shares of the Series M1  Preferred  Stock shall rank (i) equal with
the Series M Preferred  Stock;  (ii) prior to the  Corporation's  Common  Stock;
(iii) prior to the Series K and L Cumulative  Convertible Preferred Stocks; (iv)
prior to any class or  series  of  capital  stock of the  Corporation  hereafter
created (unless,  with the consent of the holder(s) of Series M1 and M Preferred
Stock);  and (iii) junior to the  Corporations  Series A Cumulative  Convertible
Preferred Stock, par value $.0001 per share (the "Senior  Securities"),  in each
case as to distribution of assets upon liquidation, dissolution or winding up of
the Corporation, whether voluntary or involuntary.


                          VIII. LIQUIDATION PREFERENCE

         A. If the  Corporation  shall  commence a voluntary case under the U.S.
Federal  bankruptcy  laws or any  other  applicable  bankruptcy,  insolvency  or
similar  law,  or consent to the entry of an order for relief in an  involuntary
case under any law or to the  appointment of a receiver,  liquidator,  assignee,
custodian,  trustee, sequestrator (or other similar official) of the Corporation
or of any  substantial  part of its  property,  or make  an  assignment  for the
benefit of its  creditors,  or admit in writing its  inability  to pay its debts
generally  as they  become due, or if a decree or order for relief in respect of
the Corporation shall be entered by a court having  jurisdiction in the premises
in an  involuntary  case  under the U.S.  Federal  bankruptcy  laws or any other
applicable bankruptcy, insolvency or similar law resulting in the appointment of
a receiver,  liquidator,  assignee,  custodian,  trustee, sequestrator (or other
similar official) of the Corporation or of any substantial part of its property,
or ordering the winding up or liquidation of its affairs, and any such decree or
order  shall be  unstayed  and in effect for a period of sixty (60)  consecutive
days and,  on  account  of any such  event,  the  Corporation  shall  liquidate,
dissolve or wind up, or if the Corporation shall otherwise  liquidate,  dissolve
or wind up (a "Liquidation Event"), no distribution shall be made to the holders
of any shares of capital stock of the Corporation (other than Senior Securities)
upon liquidation,  dissolution or winding up unless prior thereto the holders of
shares of  Series  M1  Preferred  Stock  shall  have  received  the  Liquidation
Preference with respect to each share.

         B. The purchase or redemption by the Corporation of stock of any class,
in any manner permitted by law, shall not, for the purposes hereof,  be regarded
as a  liquidation,  dissolution  or winding up of the  Corporation.  Neither the
consolidation or merger of the Corporation with or into any other entity nor the
sale or transfer by the Corporation of less than substantially all of its assets
shall,  for the purposes hereof,  be deemed to be a liquidation,  dissolution or
winding up of the Corporation.

         C. The  "Liquidation  Preference"  with respect to a share of Series M1
Preferred  Stock  means an  amount  equal to the Face  Amount  thereof  plus the
accrued Premium thereon through the date of final distribution.  The Liquidation
Preference  with respect to any Pari Passu  Securities  shall be as set forth in
the Certificate of Designation filed in respect thereof.


                     IX. ADJUSTMENTS TO THE CONVERSION PRICE

         The Conversion  Price shall be subject to adjustment  from time to time
as follows:

         A. Stock Splits,  Stock Dividends,  Etc. If at any time on or after the
date of execution, the number of outstanding shares of Common Stock is increased
by a stock split, stock dividend, combination, reclassification or other similar
event, the Conversion Price shall be proportionately  reduced,  or if the number
of  outstanding  shares of Common Stock is  decreased by a reverse  stock split,
combination  or   reclassification  of  shares,  or  other  similar  event,  the
Conversion  Price  shall  be  proportionately  increased.  In  such  event,  the
Corporation shall notify the  Corporation's  transfer agent of such change on or
before the effective date thereof.

         B. Adjustment Due to Merger, Consolidation,  Etc. If, at any time after
the date of execution,  there shall be (i) any reclassification or change of the
outstanding  shares of Common Stock  (other than a change in par value,  or from
par value to no par value,  or from no par value to par value, or as a result of
a  subdivision  or  combination),  (ii)  any  consolidation  or  merger  of  the
Corporation  with any other entity (other than a merger in which the Corporation
is the surviving or continuing entity and its capital stock is unchanged), (iii)
any  sale  or  transfer  of  all or  substantially  all  of  the  assets  of the
Corporation or (iv) any share exchange  pursuant to which all of the outstanding
shares of Common Stock are converted into other  securities or property (each of
(i) - (iv) above being a  "Fundamental  Change"),  then the holders of Series M1
Preferred Stock shall thereafter have the right to receive upon  conversion,  in
lieu of the shares of Common  Stock  otherwise  issuable,  such shares of stock,
securities  and/or  other  property as would have been issued or payable in such
Fundamental  Change with  respect to or in exchange  for the number of shares of
Common Stock which would have been issuable upon conversion had such Fundamental
Change not taken place,  and in any such case,  appropriate  provisions shall be
made with  respect to the rights and  interests  of the holders of the Series M1
Preferred  Stock to the end  that  the  provisions  hereof  (including,  without
limitation,  provisions for adjustment of the Conversion Price and of the number
of shares of Common Stock  issuable  upon  conversion of the Series M1 Preferred
Stock)  shall  thereafter  be  applicable,  as nearly as may be  practicable  in
relation to any shares of stock or securities  thereafter  deliverable  upon the
conversion thereof.  The Corporation shall not effect any transaction  described
in this  Paragraph  B unless (i) each  holder of Series M1  Preferred  Stock has
received  written  notice of such  transaction  at least  thirty (30) days prior
thereto,  but in no event  later than ten (10) days prior to the record date for
the  determination of shareholders  entitled to vote with respect  thereto,  and
(ii) the  resulting  successor  or  acquiring  entity  (if not the  Corporation)
assumes by written  instrument  the  obligations  of this Paragraph B. The above
provisions  shall  apply  regardless  of whether or not there  would have been a
sufficient  number of  shares  of Common  Stock  authorized  and  available  for
issuance upon conversion of the shares of Series M1 Preferred Stock  outstanding
as of the date of such  transaction,  and shall  similarly  apply to  successive
reclassifications, consolidations, mergers, sales, transfers or share exchanges.

         C.  Adjustment  Due to  Distribution.  If at any time after the date of
execution the Corporation  shall declare or make any  distribution of its assets
(or rights to  acquire  its  assets)  to  holders  of Common  Stock as a partial
liquidating  dividend,  by way of return of capital or otherwise  (including any
dividend or distribution to the Corporation's shareholders in cash or shares (or
rights to acquire shares) of capital stock of a subsidiary (i.e. a spin-off)) (a
"Distribution"),  then  the  holders  of  Series  M1  Preferred  Stock  shall be
entitled,  upon any conversion of shares of Series M1 Preferred  Stock after the
date of record for determining  shareholders  entitled to such Distribution,  to
receive  the amount of such assets  which would have been  payable to the holder
with respect to the shares of Common Stock  issuable  upon such  conversion  had
such holder  been the holder of such  shares of Common  Stock on the record date
for the determination of shareholders entitled to such Distribution.

         D. Purchase  Rights.  If at any time after the date of  execution,  the
Corporation  issues any  Convertible  Securities  or rights to  purchase  stock,
warrants,  securities or other property (the "Purchase  Rights") pro rata to the
record  holders  of any class of Common  Stock,  then the  holders  of Series M1
Preferred Stock will be entitled to acquire,  upon the terms  applicable to such
Purchase  Rights,  the  aggregate  Purchase  Rights which such holder could have
acquired if such holder had held the number of shares of Common Stock acquirable
upon complete conversion of the Series M1 Preferred Stock immediately before the
date on which a record is taken for the grant, issuance or sale of such Purchase
Rights,  or, if no such record is taken, the date as of which the record holders
of  Common  Stock  are to be  determined  for the  grant,  issue or sale of such
Purchase Rights.

         E. Notice of  Adjustments.  Upon the  occurrence of each  adjustment or
readjustment  of  the  Conversion   Price  pursuant  to  this  Article  IX,  the
Corporation,   at  its  expense,  shall  promptly  compute  such  adjustment  or
readjustment and prepare and furnish to each holder of Series M1 Preferred Stock
a certificate  setting  forth such  adjustment  or  readjustment  and showing in
detail the facts  upon  which such  adjustment  or  readjustment  is based.  The
Corporation  shall, upon the written request at any time of any holder of Series
M1 Preferred Stock,  furnish to such holder a like certificate setting forth (i)
such adjustment or readjustment, (ii) the Conversion Price at the time in effect
and (iii) the number of shares of Common Stock and the amount,  if any, of other
securities or property which at the time would be received upon  conversion of a
share of Series M1 Preferred Stock.


                                X. VOTING RIGHTS

         The  holders of the  Series M1  Preferred  Stock  have no voting  power
whatsoever, except as otherwise provided by the Delaware General Corporation Law
(the "Business Corporation Law"), in this Article X and in Article XI below.

         Notwithstanding the above, the Corporation shall provide each holder of
Series  M1  Preferred  Stock  with  prior  notification  of any  meeting  of the
shareholders  (and  copies  of proxy  materials  and other  information  sent to
shareholders).  If the Corporation  takes a record of its  shareholders  for the
purpose of  determining  shareholders  entitled  to (a)  receive  payment of any
dividend  or  other  distribution,  any  right to  subscribe  for,  purchase  or
otherwise   acquire   (including   by   way   of   merger,    consolidation   or
recapitalization) any share of any class or any other securities or property, or
to receive any other right, or (b) to vote in connection with any proposed sale,
lease  or  conveyance  of  all  or  substantially  all  of  the  assets  of  the
Corporation, or any proposed merger, consolidation,  liquidation, dissolution or
winding  up of the  Corporation,  the  Corporation  shall  mail a notice to each
holder, at least twenty (20) days prior to the record date specified therein (or
thirty  (30)  days  prior  to the  consummation  of the  transaction  or  event,
whichever is earlier,  but in no event earlier than public  announcement of such
proposed  transaction),  of the date on which any such record is to be taken for
the purpose of such vote,  dividend,  distribution,  right or other event, and a
brief  statement  regarding  the amount and  character  of such vote,  dividend,
distribution, right or other event to the extent known at such time.

         To the extent that under the Business  Corporation  Law the vote of the
holders  of the  Series M1  Preferred  Stock,  voting  separately  as a class or
series,  as  applicable,  is  required  to  authorize  a  given  action  of  the
Corporation,  the  affirmative  vote or  consent  of the  holders  of at least a
majority of the shares of the Series M1 Preferred  Stock  represented  at a duly
held meeting at which a quorum is present or by written consent of a majority of
the shares of Series M1 Preferred  Stock  (except as  otherwise  may be required
under the Business Corporation Law) shall constitute the approval of such action
by the class.  To the extent that under the Business  Corporation Law holders of
the Series M1  Preferred  Stock are entitled to vote on a matter with holders of
Common Stock,  voting  together as one class,  each share of Series M1 Preferred
Stock  shall be  entitled  to a number of votes equal to the number of shares of
Common  Stock into which it is then  convertible  using the record  date for the
taking of such vote of shareholders as the date as of which the Conversion Price
is calculated.


                            XI. PROTECTION PROVISIONS

         So long as any shares of Series M1 Preferred Stock are outstanding, the
Corporation  shall not, without first obtaining the approval (by vote or written
consent, as provided by the Business Corporation Law) of the holders of at least
a majority of the then outstanding shares of Series M1 Preferred Stock:

                  (a) alter or change the rights, preferences  or  privileges of
                  the Series M1 Preferred Stock;

                  (b) alter or change the rights,  preferences  or privileges of
                  any capital stock of the Corporation so as to affect adversely
                  the Series M1 Preferred Stock;

                  (c) create any new class or series of capital  stock  having a
                  preference   over  the  Series  M1   Preferred   Stock  as  to
                  distribution  of  assets  upon  liquidation,   dissolution  or
                  winding up of the Corporation (as previously defined,  "Senior
                  Securities");

                  (d) create any new class or series of  capital  stock  ranking
                  pari  passu  with  the  Series  M1   Preferred   Stock  as  to
                  distribution  of  assets  upon  liquidation,   dissolution  or
                  winding up of the  Corporation (as previously  defined,  "Pari
                  Passu Securities");

                  (e) increase the authorized  number  of  shares  of  Series M1
                  Preferred Stock;

                  (f) issue any shares of Series M1  Preferred  Stock other than
                  pursuant  to  the  Securities  Purchase  Agreement  with  Fred
                  Kassner;

                  (g) issue any additional shares of Senior Securities; or

                  (h) redeem, or declare or pay any cash  dividend or  distribu-
                  tion on, any Junior Securities.

If holders of at least a majority  of the then  outstanding  shares of Series M1
Preferred  Stock agree to allow the  Corporation  to alter or change the rights,
preferences or privileges of the shares of Series M1 Preferred Stock pursuant to
subsection (a) above, then the Corporation shall deliver notice of such approved
change to the  holders  of the Series M1  Preferred  Stock that did not agree to
such alteration or change (the "Dissenting  Holders") and the Dissenting Holders
shall have the right,  for a period of thirty (30) days, to convert  pursuant to
the terms of this  Certificate  of  Designation  as they  existed  prior to such
alteration  or change or to continue to hold their shares of Series M1 Preferred
Stock.

                               XII. MISCELLANEOUS

         A.  Cancellation of Series M1 Preferred  Stock. If any shares of Series
M1 Preferred Stock are converted pursuant to Article IV, the shares so converted
shall be  canceled,  shall  return to the  status of  authorized,  but  unissued
preferred  stock of no  designated  series,  and  shall not be  issuable  by the
Corporation as Series M1 Preferred Stock.

         B. Lost or Stolen Certificates.  Upon receipt by the Corporation of (i)
evidence of the loss,  theft,  destruction or mutilation of any Preferred  Stock
Certificate(s)  and  (ii) (y) in the case of  loss,  theft  or  destruction,  of
indemnity  reasonably  satisfactory  to the  Corporation,  or (z) in the case of
mutilation,   upon   surrender  and   cancellation   of  the   Preferred   Stock
Certificate(s),  the  Corporation  shall execute and deliver new Preferred Stock
Certificate(s)  of like tenor and date.  However,  the Corporation  shall not be
obligated to reissue such lost or stolen Preferred Stock  Certificate(s)  if the
holder  contemporaneously  requests  the  Corporation  to convert such Series M1
Preferred Stock.

         C. Status as Stockholder.  Upon submission of a Notice of Conversion by
a holder of Series M1  Preferred  Stock,  the shares  covered  thereby  shall be
deemed converted into shares of Common Stock and the holder's rights as a holder
of such converted shares of Series M1 Preferred Stock shall cease and terminate,
excepting only the right to receive certificates for such shares of Common Stock
and to any remedies  provided herein or otherwise  available at law or in equity
to such holder because of a failure by the  Corporation to comply with the terms
of this Certificate of Designation.  Notwithstanding the foregoing,  if a holder
has not received  certificates for all shares of Common Stock prior to the tenth
(10th)  business day after the expiration of the Delivery Period with respect to
a  conversion  of Series M1  Preferred  Stock for any reason,  then  (unless the
holder  otherwise  elects to retain its status as a holder of Common  Stock) the
holder  shall  regain the rights of a holder of Series M1  Preferred  Stock with
respect  to such  unconverted  shares  of  Series  M1  Preferred  Stock  and the
Corporation shall, as soon as practicable, return such unconverted shares to the
holder.



                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]


<PAGE>


         IN WITNESS  WHEREOF,  this  Certificate  of  Designation is executed on
behalf of the Corporation this 30th day of June, 1998.


                                         TREEV, INC.



                                         By:_________________________




<PAGE>


                                                       
                              NOTICE OF CONVERSION

                    (To be Executed by the Registered Holder
               in order to Convert the Series M1 Preferred Stock)

The undersigned  hereby  irrevocably  elects to convert  ____________  shares of
Series M1 Preferred Stock (the  "Conversion"),  represented by stock certificate
No.(s).  ___________ (the "Preferred Stock  Certificates") into shares of common
stock  ("Common  Stock") of TREEV,  Inc.  (the  "Corporation")  according to the
conditions of the Certificate of Designations,  Preferences and Rights of Series
M1 Convertible  Preferred Stock (the  "Certificate of  Designation"),  as of the
date written below. If securities are to be issued in the name of a person other
than the  undersigned,  the undersigned will pay all transfer taxes payable with
respect thereto. No fee will be charged to the holder for any conversion, except
for  transfer  taxes,  if any. A copy of each  Preferred  Stock  Certificate  is
attached hereto (or evidence of loss, theft or destruction thereof).

The  undersigned  represents  and  warrants  that all  offers  and  sales by the
undersigned of the securities issuable to the undersigned upon conversion of the
Series M1 Preferred  Stock shall be made pursuant to  registration of the Common
Stock under the Securities  Act of 1933, as amended (the "Act"),  or pursuant to
an exemption from registration under the Act.

[  ]     The undersigned  hereby  requests that the  Corporation  electronically
         transmit  the  Common  Stock  issuable   pursuant  to  this  Notice  of
         Conversion to the account of the  undersigned's  Prime Broker (which is
         __________)  with DTC through its Deposit  Withdrawal  Agent Commission
         System.


                            Date of Conversion:___________________________

                            Applicable Conversion Price:    $.8125

                            Number of Shares of
                            Common Stock to be Issued:____________________

                            Signature:____________________________________

                            Name:_________________________________________

                            Address:______________________________________

* The  Corporation  is not  required to issue  shares of Common  Stock until the
original  Preferred  Stock   Certificate(s)  (or  evidence  of  loss,  theft  or
destruction  thereof) to be  converted  are received by the  Corporation  or its
transfer agent.  The Corporation  shall issue and deliver shares of Common Stock
to an overnight  courier not later than the later of (a) two (2)  business  days
following  receipt of this Notice of Conversion and (b) delivery of the original
Preferred Stock Certificates (or evidence of loss, theft or destruction thereof)
and shall make  payments  pursuant to the  Certificate  of  Designation  for the
failure to make timely delivery.