<PAGE>

                                                                   EXHIBIT 4.2.1

                           CERTIFICATE OF DESIGNATION

                            VALERO ENERGY CORPORATION

                           CERTIFICATE OF DESIGNATION
                         Pursuant to Section 151 of the
                General Corporation Law of the State of Delaware

                  We, the undersigned, John D. Gibbons, Executive Vice President
and Chief Financial Officer, and Jay D. Browning, Vice President and Corporate
Secretary of Valero Energy Corporation, a Delaware corporation (herein called
the "corporation"), pursuant to the provisions of Section 151 of the General
Corporation Law of the State of Delaware, do hereby make this Certificate of
Designation and do hereby state and certify that pursuant to the authority
expressly vested in the Board of Directors of the corporation by the Restated
Certificate of Incorporation, the Board of Directors, at a meeting thereof duly
called and held on March 20, 2003, at which meeting a quorum was present,
appointed a special committee of directors (the "Special Committee") to
designate the terms of an issue of preferred stock of the corporation in
connection with a proposed acquisition by the corporation approved at such
meeting and pursuant to a meeting of the Special Committee held on April 23,
2003, the Special Committee duly adopted the following resolutions providing for
the issuance of a series of shares of Preferred Stock as hereinafter referred
to, and further providing for the powers, designations, preferences and
relative, participating, optional or other special rights thereon, and the
qualifications, limitations or restrictions thereof, in addition to those set
forth in said Restated Certificate of Incorporation, all in accordance with the
provisions of Section 151 of the General Corporation Law of the State of
Delaware:

                  RESOLVED, that pursuant to the authority expressly granted to
and vested in the Board of Directors of the corporation by the provisions of the
Restated Certificate of Incorporation of the corporation, as amended, out of the
authorized but unissued shares of Preferred Stock of the corporation, this
corporation hereby creates a series of the Preferred Stock, par value $.01 per
share, of the corporation, and authorizes the issuance thereof, and hereby fixes
the powers, designations, preferences and relative, participating, optional or
other special rights of the shares of such series, and the qualifications,
limitations, or restrictions thereof (in addition to the powers, designations,
preferences and relative, participating, optional or other special rights, and
the qualifications, limitations or restrictions thereof, set forth in the
Restated Certificate of Incorporation of the corporation, as amended, which are
applicable to Preferred Stock of all series) as follows:

                    2% MANDATORY CONVERTIBLE PREFERRED STOCK

1.       Designation and Amount. The designation of the series of Preferred
Stock created by this resolution shall be 2% Mandatory Convertible Preferred
Stock (hereinafter called the "Preferred Stock"), and the number of shares
constituting such series shall initially be 10 million shares with a stated
value of $25.00 per share. The number of authorized but unissued shares of
Preferred Stock may be reduced by further resolution duly adopted by the Board
of Directors of the corporation or a duly authorized committee thereof and by
the filing of a certificate pursuant to the provisions of the General
Corporation Law of the State of Delaware stating that such

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2.       reduction has been so authorized, but the number of authorized shares
of Preferred Stock shall not be increased.

3.       Dividend.

                  (a)      The holders of the Preferred Stock shall be entitled
         to receive, when and as declared by the Board of Directors out of the
         funds of the corporation legally available therefor, dividends in cash
         at the rate per annum of $0.50 per share. Dividends on the Preferred
         Stock, will accrue from the date of original issuance and will be paid
         (when and as declared by the Board of Directors of the corporation)
         quarterly, in arrears, on the last day of each March, June, September
         and December (each, a "Dividend Payment Date"), commencing on September
         30, 2003, except that if such Dividend Payment Date is not a business
         day, then such dividend shall be payable on the first immediately
         succeeding business day (as used herein, the term "business day" shall
         mean any day except a Saturday, Sunday or day on which banking
         institutions are legally authorized to close in the City of New York).
         The first dividend on the Preferred Stock paid on the last day of the
         calendar quarter during which the Preferred Stock is issued will
         reflect an accrual of dividends from the date of issuance to the end of
         such quarter at the annual dividend rate. The amount of dividends
         payable on each share of Preferred Stock for each full quarterly period
         thereafter shall be computed by dividing the annual dividend rate by
         four. The amount of dividends payable for any other period that is
         shorter or longer than a full quarterly dividend period will be
         computed on the basis of a 360-day year consisting of twelve 30-day
         months. Notwithstanding the foregoing and subject to the following
         sentence, dividends on the Preferred Stock shall be non-cumulative,
         shall not accrue and shall not be payable with respect to any calendar
         quarter (a "Non-Accruing Quarter") in any calendar year if between the
         first day of such calendar quarter and the last day of such calendar
         quarter the Board of Directors shall not have declared a dividend on
         the Common Stock. If the Board of Directors announces a change in
         dividend policy to suspend quarterly dividends and pay dividends on a
         semiannual or annual basis, any dividend that would have otherwise
         accrued on the Preferred Stock during any Non-Accruing Quarter in the
         period covered by such policy but for the operation of the immediately
         preceding sentence shall accrue and shall become payable in accordance
         with the terms of this Certificate of Designation. Each such dividend
         shall be paid to the holders of record of shares of the Preferred Stock
         as they appear on the stock register of the corporation on the first
         business day of the calendar month in which the applicable Dividend
         Payment Date falls. Dividends in arrears on any Preferred Stock not
         declared for payment or paid on any Dividend Payment Date (or, as
         applicable, next business day) may be declared by the Board of
         Directors of the corporation and paid on any date fixed by the Board of
         Directors of the corporation, whether or not a Dividend Payment Date
         (or, as applicable, the next business day) to the holders of record of
         the shares of Preferred Stock as they appear on the stock register of
         the corporation on such record date, not exceeding 30 days preceding
         the payment date thereof, as shall be fixed by the Board of Directors
         of the corporation.

                  (b)      If all accrued but unpaid dividends on the Preferred
         Stock have not been declared and paid or irrevocably set apart for
         payment when due, then the corporation shall not (i) declare or pay any
         dividend on any Dividend Pari Passu Security or

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         Dividend Junior Security (each as defined below), (ii) redeem,
         purchase, retire or otherwise acquire for consideration shares of any
         Dividend Junior Security (or rights, options or warrants to purchase
         such Dividend Junior Security), other than (w) purchases or
         acquisitions of shares of any Dividend Junior Security in connection
         with any employee benefit or incentive plan, including the purchase of
         Common Stock to prevent dilution of outstanding Common Stock in the
         administration of such plans, (x) as a result of a reclassification of
         any Dividend Junior Security or the exchange or conversion of one class
         or series of any Dividend Junior Security for another class or series
         of any Dividend Junior Security, (y) redemptions or purchases of any
         Preference Share Purchase Rights (as defined below) or the declaration
         and payment of a dividend or distribution of similar share purchase
         rights in the future or (z) the purchase of fractional interests in
         shares of any Dividend Junior Security pursuant to the conversion or
         exchange provisions of such Dividend Junior Security, (iii) redeem,
         purchase, retire or otherwise acquire for consideration any Dividend
         Pari Passu Security (or rights, options or warrants to purchase such
         Dividend Pari Passu Security) or (iv) permit any subsidiary of the
         corporation to purchase or otherwise acquire for consideration any
         shares of stock of the corporation unless the corporation could,
         pursuant to the foregoing, purchase or otherwise acquire such shares at
         such time and in such manner. The preceding sentence, however, shall
         not apply to, or prohibit (i) dividends or distributions of any
         Preference Share Purchase Rights, (ii) dividends or distributions of
         similar share purchase rights in the future, (iii) dividends or
         distributions in shares of Common Stock or another class or series of
         capital stock of the corporation that is junior to the Preferred Stock
         as to the payment of dividends and the distribution of assets upon
         liquidation, dissolution or winding-up of the corporation or (iv)
         dividends, distributions, redemptions and other payments under the
         Premium Equity Participating Security Units and the Trust Originated
         Preferred Securities issued by subsidiaries of the corporation and
         outstanding on the date of the issuance of the Preferred Stock. The
         term "Dividend Pari Passu Security" means any preference stock or
         preferred stock or other capital stock of the corporation ranking pari
         passu with the Preferred Stock as to the payment of dividends.
         "Dividend Junior Security" means Common Stock and any other class or
         series of capital stock of the corporation ranking junior to the
         Preferred Stock as to the payment of dividends.

4.       Redemption. The shares of Preferred Stock are not redeemable by the
corporation.

5.       Regarding Voting Rights.

                  (a)      The holders of the Preferred Stock shall not, except
         as otherwise provided by subsections (b) or (c) of this Section 4 or as
         required by law or as set forth in the Restated Certificate of
         Incorporation of the corporation, have any right or power to vote on
         any question or in any proceeding or to be represented at or to receive
         notice of any meeting of stockholders. Except as otherwise provided in
         subsection (b) of this Section 4, on any matters on which the holders
         of the Preferred Stock shall be entitled to vote, they shall be
         entitled to one vote for each share held.

                  (b)      Each holder of shares of Preferred Stock shall have a
         number of votes per share of Preferred Stock as to all matters voted
         upon by the holders of Common Stock

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<PAGE>

         equal to the Voting Ratio in effect on the record date for determining
         the holders of Common Stock entitled to vote on such matters, and shall
         be entitled to vote on all such matters together with the holders of
         the Common Stock, and together with the holders of any other classes or
         series of stock who are entitled to vote thereon and, except as
         provided in subsection (c), not as a separate class. The "Voting
         Ratio," in effect on a particular date, shall mean the Conversion Ratio
         that would have been in effect if the Conversion Date occurred on such
         date.

                  (c)      So long as any shares of Preferred Stock remain
         outstanding, the approval of the holders of at least two-thirds of the
         outstanding shares of Preferred Stock voting together as a separate
         class, given in person or by proxy, at any special or annual meeting
         called for such purpose, or by written consent as permitted by
         applicable law and the Restated Certificate of Incorporation and Bylaws
         of the corporation, shall be necessary to permit, effect or validate
         any amendment, alteration or repeal, by merger or otherwise, of any of
         the provisions of the Restated Certificate of Incorporation or of this
         Certificate of Designation which would adversely affect any power,
         preference or special right of the Preferred Stock provided that such
         an adverse effect shall not be deemed to have occurred solely as a
         result of the authorization, designation or issuance of any class of
         equity security.

6.       Priority in Event of Dissolution. In the event of any liquidation,
dissolution, or winding up of the affairs of the corporation, after payment or
provision for payment of the debts and other liabilities of the corporation, the
holders of the Preferred Stock shall be entitled to receive, out of the
remaining assets of the corporation, the amount of $25.00 in cash for each share
of Preferred Stock, plus in each case an amount equal to all dividends accrued
and unpaid on each such share (whether or not declared) up to the date fixed for
distribution, before any distribution shall be made to the holders of the Common
Stock or to the holders of any other class of stock ranking junior to the
Preferred Stock as to distribution of assets upon the liquidation, dissolution
or winding up of the affairs of the corporation. If upon any liquidation,
dissolution or winding up of the affairs of the corporation, the assets
distributable among the holders of Preferred Stock shall be insufficient to
permit the payment in full to the holders of all of the Preferred Stock of all
preferential amounts payable to all such holders, then the entire assets of the
corporation thus distributable shall be distributed ratably among the holders of
the Preferred Stock in proportion to the respective amounts that would be
payable per share if such assets were sufficient to permit payment in full.

7.       Conversion.

                  (a)      On July 1, 2006 (the "Conversion Date"), each share
         of Preferred Stock will be automatically converted (unless previously
         converted at the option of the holder of such Preferred Stock in
         accordance with Section 6(b) or a Change of Control Early Conversion
         has occurred in accordance with Section 6(c)) into (i) the number of
         shares of Common Stock, $.01 par value, of the corporation ("Common
         Stock") as provided below and (ii) the right to receive an amount in
         cash equal to all accrued and unpaid dividends on such share of
         Preferred Stock to and including the day immediately prior to the
         Conversion Date, whether or not earned or declared, out of funds
         legally available therefor provided, that for purposes of this clause
         (ii) any dividends that would have

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<PAGE>

         been accrued and unpaid as of the Conversion Date in respect of the
         quarter in which the Conversion Date occurs but for the fact that the
         corporation shall not have declared a dividend on the Common Stock
         during such quarter and prior to the Conversion Date, such dividends
         shall be treated as accrued and unpaid unless prior to the Conversion
         Date the corporation shall have publicly announced an intention to not
         declare a dividend on the Common Stock during such quarter. The number
         of shares of Common Stock to be received for each share of Preferred
         Stock (the "Conversion Ratio") shall be based on the Applicable Market
         Value in accordance with the following table, in each case subject to
         adjustment as provided in this Section 6:

<TABLE>
<CAPTION>
                                                                  Conversion Ratio
                                                             ---------------------------
                                                             Shares of Common Stock for
      Applicable Market Value                               each share of Preferred Stock
---------------------------------------                     -----------------------------
<S>                                                         <C>
(1)   Less than or equal to $37.37                                      .6690

(2)   Greater than $37.37 but less than                                $25.00
      or equal to  $50.45                                      -----------------------
                                                               Applicable Market Value
(3)   Greater than $50.45                                               .4955
</TABLE>

                  Subject to any adjustment pursuant to this Section 6, the
         "Applicable Market Value" means the average of the Closing Prices (as
         defined in subsection (j) below) per share of Common Stock on each of
         the twenty (20) consecutive Trading Days (as defined in subsection (j)
         below) ending on the second Trading Day immediately preceding the
         Conversion Date or the applicable Change of Control Early Conversion
         Date (as defined herein) as the case may be.

                  (b)      Each share of Preferred Stock is convertible, at the
         option of the holder thereof ("Optional Conversion"), at any time or
         from time to time, before the Conversion Date into a number of shares
         of Common Stock equal to the conversion ratio set forth in clause (3)
         of the definition of Conversion Ratio (as may be adjusted pursuant to
         this Section 6) (the "Optional Conversion Ratio"). Optional Conversion
         of shares of Preferred Stock may be effected by delivering written
         notice of conversion and the certificates and instruments required by
         subsection (d) to the office of the corporation set forth in subsection
         (d). Each Optional Conversion shall be deemed to have been effected
         immediately before the close of business on the date on which the
         foregoing requirements shall have been satisfied. The Optional
         Conversion shall be at the Optional Conversion Ratio in effect at such
         time and on such date. Holders of shares of Preferred Stock at the
         close of business on the record date for any payment of declared
         dividends shall be entitled to receive the dividend payable on such
         share of Preferred Stock on the corresponding dividend payment date
         notwithstanding the Optional Conversion of such shares of Preferred
         Stock following such record date and on or prior to such dividend
         payment date. Except as provided above, upon any Optional Conversion of
         shares of Preferred Stock, the corporation shall make no payment of or
         allowance for unpaid dividends, whether or not in arrears, on such
         shares of Preferred Stock as to which

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<PAGE>

         Optional Conversion has been effected or for previously declared
         dividends or distributions on the shares of Common Stock issued upon
         Optional Conversion.

                  (c)      Upon a Change of Control (as defined below) that is
         not a Common Stock Transaction (as defined below) and that occurs no
         later than the fifth business day immediately preceding the Conversion
         Date, each holder of Preferred Stock shall have the right, at the
         holder's option, for a period of 30 days after the mailing of a notice
         by the corporation to the holders of the Preferred Stock pursuant to
         this subsection (c) that a Change of Control has occurred, to convert
         all or any portion of such holder's shares of Preferred Stock (a
         "Change of Control Early Conversion") into Common Stock (or other
         securities or property pursuant to an adjustment to the Conversion
         Ratio including in respect of such Change of Control) at the Conversion
         Ratio in effect (after giving effect to any adjustments in respect of
         such Change of Control) on the effective date of such conversion (the
         "Change of Control Early Conversion Date"). Within 20 days after the
         occurrence of the Change of Control, the corporation shall mail written
         notice to each holder of Preferred Stock of the occurrence of the
         Change of Control, which notice shall be made by certified or
         registered mail and shall specify the deadline for submitting a notice
         of an election to convert pursuant to this subsection (c), the date on
         which such Change of Control shall have occurred, the applicable
         Conversion Ratio and the amount per share of Preferred Stock or cash,
         securities and other consideration receivable by the holder upon
         conversion if an election is made pursuant to the immediately preceding
         sentence. In addition, if a holder of Preferred Stock effects a Change
         of Control Early Conversion of some or all of such holder's Preferred
         Stock, such holder shall be entitled to receive, on the Change of
         Control Early Conversion Date, the aggregate amount of any accrued and
         unpaid dividends to and including the day immediately prior to the
         Change of Control Early Conversion Date on such shares of Preferred
         Stock that are so converted, whether or not earned or declared, out of
         funds legally available therefor. The Change of Control Early
         Conversion of shares of Preferred Stock may be effected by delivering
         written notice of conversion and certificates and instruments required
         by subsection (d) to the office of the corporation as set forth in
         subsection (d). Each Change of Control Early Conversion shall be deemed
         to have been effected immediately before the close of business on the
         date on which the foregoing requirements shall have been satisfied.

                  "Change of Control" means any of the following events: (i) the
         sale, lease, transfer, conveyance or other disposition (other than by
         way of merger or consolidation), in one or a series of related
         transactions, of all or substantially all of the assets of the
         corporation and its subsidiaries taken as a whole to any "person" or
         group of related persons (a "Group") (as such term is used in Sections
         13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
         "Exchange Act")); (ii) the consummation of any transaction (including,
         without limitation, any purchase, sale, acquisition, disposition,
         merger or consolidation) the result of which is that any "person" or
         Group becomes the "beneficial owner" (as such term is defined in Rule
         13d-3 and Rule 13d-5 under the Exchange Act) of more than 50% of the
         aggregate voting power of all classes of capital stock of the
         corporation having the right to elect directors under ordinary
         circumstances; (iii) any consolidation or merger of the corporation
         with or into another corporation (other than a merger or consolidation
         in which the Common Stock outstanding

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<PAGE>

         immediately prior to the merger or consolidation is not exchanged for
         cash, securities or other property of the corporation or another entity
         except an entity created for such transaction in which each share of
         Common Stock is converted into one share of common stock of such
         entity) or (iv) the adoption of a plan relating to the liquidation or
         dissolution of the corporation.

                  "Common Stock Transaction" means any transaction in which more
         than 50% of the value (as determined in good faith by the Board of
         Directors of the corporation) of the consideration received by holders
         of the Common Stock consists of common stock that for each of the ten
         consecutive Trading Days prior to the effective date of the transaction
         has been admitted for listing or admitted for listing subject to notice
         of issuance on a national securities exchange or quoted on the Nasdaq
         National Market.

                  (d)      As promptly as practicable following the Conversion
         Date or, in the case of an Optional Conversion or a Change of Control
         Early Conversion, after the surrender of a certificate representing
         shares of Preferred Stock which have been converted to the corporation
         at the principal offices of the corporation located at One Valero
         Place, San Antonio, Texas 78212, Attention: Shareholder Services
         Department (or at such other place as the corporation shall hereafter
         designate in writing to the registered holders of the Preferred Stock),
         accompanied by a written instrument in form reasonably satisfactory to
         the corporation duly executed by the registered holder or his duly
         authorized legal representative specifying the name or names (with
         address) in which the Common Stock is to be issued, the corporation
         shall deliver or cause to be delivered at the offices set forth above
         to or upon the written order of the holder of such shares of Preferred
         Stock so surrendered a certificate or certificates representing the
         number of fully paid and nonassessable shares of Common Stock or other
         cash, securities or property into which such shares of Preferred Stock
         have been converted in accordance with the provisions of this Section
         6. Conversion shall be deemed to have been made immediately prior to
         the close of business on the Conversion Date or the date specified in
         subsection (b) and (c), as applicable, so that the rights of the
         holders of such shares as holders of Preferred Stock shall cease with
         respect to such shares at such time, and the person or persons entitled
         to receive the shares of Common Stock upon conversion of shares of
         Preferred Stock shall be treated for all purposes as having become the
         record holder or holders of such shares of Common Stock at such time.
         Except as otherwise expressly provided herein, no adjustments in
         respect of cash dividends on Common Stock or Preferred Stock shall be
         made upon the conversion of any shares provided that if a record date
         for dividends on the Preferred Stock shall have occurred prior to the
         close of business on the Conversion Date or such other date as the
         conversion is deemed to have been effected, holders of Preferred Stock
         shall be entitled to receive such dividend, irrespective of whether
         conversion of such Preferred Stock into Common Stock has occurred prior
         to such dividend payment date.

                  (e)      If the corporation shall (i) pay a stock dividend or
         stock dividends or otherwise make a distribution or distributions on
         shares of its Common Stock in each case payable in shares of its Common
         Stock, (ii) subdivide outstanding shares of Common Stock into a larger
         number of shares, (iii) combine outstanding shares of Common Stock into
         a smaller number of shares, or (iv) issue by reclassification of shares

                                       7
<PAGE>

         of Common Stock any shares of capital stock of the corporation of any
         class or classes, the Conversion Ratio applicable prior to such action
         shall be adjusted so that the holder of any Preferred Stock thereafter
         surrendered for conversion shall be entitled to receive the Conversion
         Ratio in effect immediately prior to such action times the number and
         class or classes of shares of the capital stock of the corporation
         which a holder of one share of Common Stock would have owned or have
         been entitled to receive immediately after the happening of any of the
         events described above. An adjustment made pursuant to this subsection
         (e) shall become effective immediately after the record date for
         determination of stockholders entitled to receive such dividend or
         distribution in the case of a dividend or distribution and shall become
         effective immediately after the effective date in the case of a
         subdivision, combination or reclassification.

                  (f)      In case the corporation shall issue rights or
         warrants to all holders of Common Stock entitling them (for a period
         expiring within 45 days after the record date mentioned below) to
         subscribe for or purchase shares of Common Stock at a price per share
         less than the then Current Market Price per share of Common Stock (as
         defined in subsection (j) below) at the record date mentioned below,
         the Conversion Ratio in effect immediately prior to such record date
         shall be increased by multiplying the Conversion Ratio applicable prior
         to such record date by a fraction, of which the numerator shall be the
         number of shares of Common Stock (excluding treasury shares, if any)
         outstanding on such record date plus the number of additional shares of
         Common Stock offered for subscription or purchase, and of which the
         denominator shall be the number of shares of Common Stock (excluding
         treasury shares, if any) outstanding on such record date plus the
         number of shares of Common Stock which the aggregate offering price of
         the total number of shares so offered for subscription or purchase
         would purchase at such Current Market Price. Such adjustment shall
         become effective immediately after the record date for the
         determination of stockholders entitled to receive such rights or
         warrants. However, upon the expiration of any right or warrant to
         purchase Common Stock the issuance of which resulted in an adjustment
         in the Conversion Ratio pursuant to this subsection (f), if any such
         right or warrant shall expire and shall not have been exercised, the
         Conversion Ratio shall immediately upon such expiration be recomputed
         and effective immediately upon such expiration be increased to the
         ratio which it would have been (but reflecting any other adjustments in
         the Conversion Ratio made pursuant to the provisions of this Section 6
         after the issuance of such rights or warrants) had the adjustment of
         the Conversion Ratio made upon the issuance of such rights or warrants
         been made on the basis of offering for subscription or purchase only
         that number of shares of Common Stock actually purchased upon the
         exercise of such rights or warrants actually exercised.

                  (g)      In case the corporation shall distribute, by dividend
         or otherwise, to all holders of Common Stock evidences of its
         indebtedness, cash or other assets (excluding any dividend or
         distribution referred to in subsection (e) above and Excluded
         Dividends) or rights to subscribe (excluding those referred to in
         subsection (f) above) or if the Distribution Date (as defined below)
         with respect to the Preference Share Purchase Rights shall occur, then
         in each such case the Conversion Ratio shall be adjusted by multiplying
         the Conversion Ratio in effect immediately prior to the record date
         fixed for determination of stockholders entitled to receive such
         distribution by a fraction, of which

                                       8
<PAGE>

         the numerator shall be the Current Market Price per share of Common
         Stock determined as of the record date mentioned above, and of which
         the denominator shall be such Current Market Price per share of the
         Common Stock less the then fair market value (as determined by the
         Board of Directors of the corporation in good faith, whose
         determination shall be conclusive if made in good faith and shall be
         described in a statement provided to all registered holders of
         Preferred Stock) of the portion of cash, other assets or evidences of
         indebtedness so distributed or such subscription rights or Preference
         Share Purchase Rights applicable to one share of the Common Stock. Such
         adjustment shall become effective immediately after the record date
         mentioned above. "Excluded Dividends" shall mean any quarterly cash
         dividend on the Common Stock to the extent that the aggregate cash
         dividend per share of Common Stock in any fiscal quarter does not
         exceed the greater of (A) the amount per share of Common Stock of the
         immediately preceding quarterly cash dividend on the Common Stock to
         the extent that such preceding quarterly dividend did not require an
         adjustment of the Conversion Ratio pursuant to this subsection (g) (as
         adjusted to reflect subdivisions or combinations of Common Stock), and
         (B) 3.5% of the arithmetic average of the Closing Prices (as defined
         below) of the Common Stock during the ten consecutive Trading Days
         immediately prior to the date of declaration of such dividend.

                  (h)      In case of a tender or exchange offer (other than any
         odd-lot tender offer) made by the corporation or any subsidiary of the
         corporation for all or any portion of the Common Stock and upon
         expiration of such tender or exchange offer, the corporation or its
         subsidiary shall be required to pay to the stockholders based on
         acceptance (up to any maximum specified in the terms of the tender or
         exchange offer) of Corporation Purchased Shares (as herein defined) any
         consideration, then if the sum of (i) the fair market value of the
         aggregate consideration to be paid in such tender offer or exchange
         offer (as determined by the Board of Directors of the corporation in
         good faith, whose determination shall be conclusive if made in good
         faith and shall be described in a statement provided to all registered
         holders of Preferred Stock) plus (ii) the aggregate of the cash plus
         the fair market value (as determined by the Board of Directors of the
         corporation in good faith, whose determination shall be conclusive if
         made in good faith and shall be described in a statement provided to
         all registered holders of Preferred Stock), as of the expiration of
         such tender or exchange offer, of consideration payable in respect of
         any other tender or exchange offer (other than consideration payable in
         respect of any odd-lot tender offer), by the corporation or any
         subsidiary of the corporation for all or any portion of Common Stock
         expiring within the 12 months preceding the expiration of such tender
         or exchange offer and in respect of which no adjustment pursuant to
         this subsection (h) has been made, plus (iii) the aggregate amount of
         any distributions (other than regular quarterly cash dividends) to all
         holders of Common Stock made exclusively in cash within the 12 months
         preceding the expiration of such tender or exchange offer and in
         respect of which no adjustment pursuant to subsection (g) has been
         made, exceeds 15% of the product of the Current Market Price per share
         of Common Stock as of the last time (the "Corporation Expiration Time")
         tenders or exchanges may be made pursuant to such tender or exchange
         offer (as it shall have been amended) times the number of shares of
         Common Stock outstanding (including any tendered shares but excluding
         treasury shares, if any) on the Corporation Expiration Time, the
         Conversion Ratio shall be increased so that the same shall equal the
         rate determined by multiplying the Conversion

                                       9
<PAGE>

         Ratio in effect immediately prior to the Corporation Expiration Time by
         a fraction of which the numerator shall be the product of (a) the
         Current Market Price per share of Common Stock as of the Corporation
         Expiration Time and (b) the number of shares of Common Stock
         outstanding (including any tendered shares but excluding treasury
         shares, if any) as of the Corporation Expiration Time less the number
         of all shares validly tendered and not withdrawn as of the Corporation
         Expiration Time (the shares deemed so accepted up to any such maximum,
         being referred to as the "Corporation Purchased Shares") and the
         denominator of which shall be equal to (x) the product of (1) the
         Current Market Price per share of Common Stock on the date of the
         Corporation Expiration Time and (2) the number of shares of Common
         Stock outstanding (including any tendered shares but excluding treasury
         shares, if any) on the date of the Corporation Expiration Time less (y)
         the amount of cash plus the fair market value (determined as aforesaid)
         of the aggregate consideration payable to stockholders based on the
         transactions described in clauses (i), (ii) and (iii) above (assuming
         in the case of clause (i) the acceptance, up to any maximum specified
         in the terms of the tender or exchange offer, of Corporation Purchased
         Shares), such adjustment to become effective at the opening of business
         on the date following the date of the Corporation Expiration Time.

                  (i)      In case of a tender or exchange offer made by a
         person other than the corporation or any subsidiary of the corporation
         for an amount which increases the offeror's ownership of Common Stock
         by more than 25% of the Common Stock outstanding (excluding treasury
         shares, if any) and shall involve the payment by such person of
         consideration per share of Common Stock having a fair market value (as
         determined by the Board of Directors of the corporation in good faith,
         whose determination shall be conclusive if made in good faith and shall
         be described in a statement provided to all registered holders of
         Preferred Stock) at the last time (the "Expiration Time") tenders or
         exchanges may be made pursuant to such tender or exchange offer (as it
         shall have been amended) that exceeds the Current Market Price of the
         Common Stock on the Trading Day next succeeding the Expiration Time,
         and in which, as of the Expiration Time, the Board of Directors is
         recommending acceptance of the offer, the Conversion Ratio shall be
         increased so that the same shall equal the rate determined by
         multiplying the Conversion Ratio in effect immediately prior to the
         Expiration Time by a fraction of which the numerator shall be the sum
         of (x) the fair market value (determined as aforesaid) of the aggregate
         consideration payable to stockholders based on the acceptance (up to
         any maximum specified in the terms of the tender or exchange offer) of
         all shares validly tendered or exchanged and not withdrawn as of the
         Expiration Time (the shares deemed so accepted, up to any such maximum,
         being referred to as the "Purchased Shares") and (y) the product of the
         number of shares of Common Stock outstanding (less any Purchased Shares
         and excluding treasury shares, if any) on the Expiration Time and the
         Current Market Price of the Common Stock on the Trading Day next
         succeeding the Expiration Time, and the denominator shall be the number
         of shares of Common Stock outstanding (including any tendered or
         exchanged shares but excluding treasury shares, if any) on the
         Expiration Time multiplied by the Current Market Price of the Common
         Stock on the Trading Day next succeeding the Expiration Time, such
         increase to become effective immediately prior the opening of business
         on the day following the Expiration Time. In the event that such person
         is obligated to purchase shares pursuant to any such tender or exchange
         offer, but such

                                       10
<PAGE>

         person is permanently prevented by applicable law from effecting any
         such purchases or all such purchases are rescinded, the Conversion
         Ratio shall again be adjusted to the Conversion Ratio which would be in
         effect if such tender or exchange offer had not been made.
         Notwithstanding the foregoing, the adjustment described in this
         subsection (i) shall not be made if, as of the Expiration Time, the
         offering documents with respect to such offer disclose a plan or
         intention to cause the corporation to engage in a consolidation or
         merger of the corporation or a sale of all or substantially all of the
         assets of the corporation.

                  (j)      For purposes of this Section 6, the "Current Market
         Price" per share of Common Stock of the corporation at any date shall
         be deemed to be equal to the average Closing Price of the Common Stock
         for the twenty (20) consecutive Trading Days ending on the second
         trading day prior to the date of determination. As used herein the
         "Closing Price" per share of Common Stock on any day shall mean the
         closing sales prices for such shares as reported in the Wall Street
         Journal's NYSE-Composite Transaction listing for such day (corrected
         for typographical errors), or if such shares are not reported in such
         listing, then the closing sales prices reported on the largest exchange
         (based on the aggregate dollar value of securities listed) on which
         such shares are listed, or if such shares are not listed or traded on
         any exchange, then the closing sales prices for such shares in the
         over-the-counter market, as reported on the National Association of
         Securities Dealers Automated Quotations System, or, if such price shall
         not be reported thereon, the average of the means between the closing
         bid and asked prices so reported, or, if such prices shall not be
         reported thereon, as the same shall be reported by the National
         Quotation Bureau Incorporated, or, in all other cases, the market value
         of the Common Stock on such date as determined by a recognized
         independent investment banking firm retained for this service by the
         corporation. A "Trading Day" means a day on which the Common Stock (A)
         is not suspended from trading on any national or regional securities
         exchange or association or over-the-counter market at the close of
         business and (B) has traded at least once on the national or regional
         securities exchange or association or over-the-counter market that is
         the primary market for the trading of the Common Stock.

                  (k)      No adjustment otherwise required in the Conversion
         Ratio shall be required unless such adjustment would require an
         increase or decrease of at least 1% in such ratio; provided, however,
         that any adjustment which by reason of this subsection (k) is not
         required to be made shall be carried forward and taken into account in
         any subsequent adjustment. All calculations under this Section 6 shall
         be made to the nearest 1/100th of a share.

                  (l)      If an adjustment is made to the Conversion Ratio
         pursuant to subsections (e), (f), (g), (h) or (i), an adjustment shall
         also be made to the Applicable Market Value solely to determine which
         of clauses (1), (2) or (3) of the definition of Conversion Ratio in
         subsection (a) shall apply on the Conversion Date or the applicable
         Change of Control Early Conversion Date, as the case may be. Such
         adjustment shall be made by multiplying the Applicable Market Value by
         a fraction of which the numerator shall be the Conversion Ratio
         immediately after such adjustment pursuant to subsections (e), (f),
         (g), (h) or (i) and the denominator shall be the Conversion Ratio

                                       11
<PAGE>

         immediately before such adjustment; provided, however, that if such
         adjustment to the Conversion Ratio is required to be made pursuant to
         the occurrence of any of the events contemplated by subsections (e),
         (f), (g), (h) or (i) during the period taken into consideration for
         determining the Applicable Market Value, appropriate and customary
         adjustments shall be made to the Conversion Ratio.

                  (m)      Whenever the Conversion Ratio is adjusted, as herein
         provided, the corporation shall promptly mail to each registered holder
         of Preferred Stock a notice setting forth the Conversion Ratio after
         such adjustment and setting forth a brief statement of the facts
         requiring such adjustment. The Conversion Ratio as most recently
         adjusted pursuant to this Section 6 shall then apply to the conversion
         of Preferred Stock pursuant to subsections (a), (b) or (c) of this
         Section 6.

                  (n)      For the purposes of this Section 6 the term "Common
         Stock" shall mean (i) the class of stock designated as the Common Stock
         of the corporation at the date of this certificate, or (ii) any other
         class of stock resulting from successive changes or reclassifications
         of such Common Stock consisting solely of changes in par value or from
         par value to no par value, or from no par value to par value. Unless
         the context otherwise specifies or requires, all references in this
         certificate to "Common Stock" include the Common Stock and the
         Preference Share Purchase Rights trading therewith. As used herein, all
         references to "Preference Share Purchase Rights" in this certificate
         shall mean the Preference Share Purchase Rights issued pursuant to that
         certain Rights Agreement, dated as of July 17, 1997, between the
         corporation and Computershare Investors Services L.L.C., as Rights
         Agent, as the same may hereafter be amended or supplemented (the
         "Rights Agreement"), and any similar rights issued in exchange for,
         upon conversion of or in substitution for such Preference Share
         Purchase Rights. As used herein, all references to the term
         "Distribution Date" shall have the meaning set forth in the Rights
         Agreement or in any successor agreement pertaining to any similar
         rights issued in exchange for, upon conversion of or in substitution
         for the Preference Share Purchase Rights. In the event that at any
         time, as a result of an adjustment made pursuant to this Section 6, the
         holder of any Preferred Stock thereafter surrendered for conversion
         shall become entitled to receive any shares of the corporation other
         than shares of Common Stock, thereafter the number of such other shares
         so receivable upon conversion of any Preferred Stock shall be subject
         to adjustment from time to time in a manner and on terms as nearly
         equivalent as practicable to the provisions with respect to the Common
         Stock contained in subsections (a) to (m) inclusive above and
         subsections (o) and (p) below, and the provisions of said subsections
         (a) to (m) above and of subsections (o) and (p) below shall apply on
         like terms to any such other shares.

                  (o)      No fractional shares or scrip representing fractional
         shares shall be issued upon the conversion of Preferred Stock. If more
         than one share of Preferred Stock shall be surrendered for conversion
         at one time by the same holder, the number of full shares of Common
         Stock issuable upon conversion thereof shall be computed by multiplying
         the aggregate number of shares of Preferred Stock so surrendered by the
         Conversion Ratio in effect at the time of conversion. If the conversion
         of any shares of Preferred Stock results in a fraction, an amount equal
         to such fraction multiplied by the Current Market Price of the Common
         Stock as of the time of conversion shall be paid promptly to such
         holder in

                                       12
<PAGE>

         cash by the corporation. All shares of Preferred Stock delivered to the
         corporation pursuant to this Section 6 shall be imprinted with a legend
         indicating such conversion, and such converted shares shall be held by
         the corporation and restored to authorized but unissued shares of
         preferred stock of the Corporation.

                  (p)      In case of (i) any consolidation or merger of the
         corporation with or into another entity (other than a merger or
         consolidation in which the corporation is the continuing corporation
         and in which the Common Stock outstanding immediately prior to the
         merger or consolidation is not exchanged for cash, securities or other
         property of the corporation or another entity created for such
         transaction in which each share of Common Stock is converted into one
         share of common stock of such entity), (ii) any sale or transfer to
         another entity of the property of the corporation as an entirety or
         substantially as an entirety or (iii) any statutory exchange of
         securities of the corporation with another entity (other than in
         connection with a merger or acquisition) (any such event, a
         "Reorganization Event"), the Conversion Ratio shall be adjusted to
         provide that each holder of Preferred Stock shall receive upon
         conversion thereof, the kind and amount of securities, cash and other
         property (the "Event Consideration") receivable upon consummation of
         the Reorganization Event by a holder of one share of Common Stock
         multiplied by the Conversion Ratio, assuming such holder of Common
         Stock is not a person or entity with which the Corporation consolidated
         or into which the corporation merged or that merged into the
         corporation or to which such sale or transfer was made, as the case may
         be ("Constituent Person"), or an affiliate of a Constituent Person, and
         that such holder failed to exercise such holder's rights of election,
         if any, as to the kind or amount of securities, cash and other property
         receivable upon such Reorganization Event (provided that if the kind or
         amount of securities, cash and other property receivable upon such
         Reorganization Event is not the same for each share of Common Stock
         held immediately prior to such Reorganization Event by other than a
         Constituent Person or an affiliate thereof and in respect of which such
         rights of election shall not have been exercised ("non-electing
         share"), then for the purpose of this subsection (p) the kind and
         amount of securities, cash and other property receivable upon such
         Reorganization Event by each non-electing share shall be deemed to be
         the kind and amount so receivable per share by a plurality of the
         non-electing shares). Following a Reorganization Event, the Applicable
         Market Value shall equal the value of the Event Consideration
         receivable in respect of one share of Common Stock, determined in the
         following manner: (i) for any Event Consideration consisting of cash,
         the amount of such cash; (ii) for any Event Consideration consisting of
         Marketable Common Stock, the average of the Closing Prices per share of
         such Marketable Common Stock on each of the twenty (20) consecutive
         Trading Days ending on the second Trading Day immediately preceding the
         Conversion Date or the applicable Change of Control Early Conversion
         Date, as the case may be; and (iii) for any Event Consideration
         consisting of securities or other property other than cash or
         Marketable Common Stock, an amount equal to the fair market value of
         such Event Consideration on the Conversion Date or the applicable
         Change of Control Early Conversion Date, as the case may be (as
         determined by the Board of Directors of the corporation in good faith,
         whose determination shall be conclusive if made in good faith and shall
         be described in a statement provided to all registered holders of
         Preferred Stock). "Marketable Common Stock" means any common equity
         securities listed on a U.S. national exchange or automated quotation
         system. In the event of and as a condition

                                       13
<PAGE>

         to such a Reorganization Event, the person or entity formed by such
         consolidation, merger or exchange shall expressly provide for (x) the
         rights of the Preferred Stock provided by this subsection (p), (y)
         adjustments to the Conversion Ratio for events subsequent to the
         effective date of such Reorganization Event that shall be as nearly
         equivalent as may be practicable to the adjustments provided for in
         this Section 6, and (z) such modifications to the definition of "Common
         Stock" and such other provisions hereof and of the Preferred Stock as
         shall be necessary to carry out the economic intent of this Certificate
         of Designations. This provision shall similarly apply to successive
         Reorganization Events.

                  (q)      The issuance of certificates for shares of Common
         Stock upon the conversion of shares of Preferred Stock shall be made
         without charge to the converting stockholders for such certificates or
         for any tax in respect of the issuance of such certificates, and such
         certificates shall be issued in the respective names of, or in such
         names as may be directed by, the holders of the shares so converted;
         provided, however, that the corporation shall not be required to pay
         any tax which may be payable in respect of any transfer involved in the
         issuance and delivery of any such certificate in a name other than that
         of the holder of the shares converted, and the corporation shall not be
         required to issue or deliver any such certificate unless and until the
         person or persons requesting the issuance thereof shall have paid to
         the corporation the amount of such tax or shall have established to the
         satisfaction of the corporation that such tax has been paid, and
         provided further, that the corporation shall not be required to pay or
         reimburse the holder for any income tax payable by such holder as a
         result of such issuance. Upon conversion of the Preferred Stock, the
         corporation may withhold the payment of dividends on Common Stock for
         the account of any holder who has not surrendered its certificate(s) of
         Preferred Stock until such time as such holder shall have done so.

                  (r)      In case:

                           (i)      the corporation shall declare a dividend (or
                  any other distribution) on the Common Stock other than
                  Excluded Dividends; or

                           (ii)     the corporation shall declare a special
                  nonrecurring cash dividend on or a redemption of its Common
                  Stock; or

                           (iii)    the corporation shall authorize the granting
                  to the holders of the Common Stock of rights or warrants to
                  subscribe for or purchase any shares of capital stock of any
                  class or of any other rights; or

                           (iv)     the approval of any stockholders of the
                  corporation shall be required in connection with any
                  reclassification of the Common Stock (other than a subdivision
                  or combination of the outstanding shares of Common Stock), any
                  consolidation or merger to which the corporation is a party,
                  any sale or transfer of all or substantially all of the assets
                  of the corporation or any statutory share exchange involving
                  the Common Stock; or

                                       14
<PAGE>

                           (v)      of the voluntary or involuntary dissolution,
                  liquidation or winding up of the affairs of the corporation;

         then the corporation shall cause to be filed at each office or agency
         maintained for the purpose of conversion of the Preferred Stock, and
         shall cause to be mailed to the holders of record of the Preferred
         Stock, at their last addresses as they shall appear upon the stock
         books of the corporation, at least 10 days prior to the applicable
         record date hereinafter specified, a notice stating (x) the date on
         which a record is to be taken for the purpose of such dividend,
         distribution, redemption, rights or warrants, or, if a record is not to
         be taken, the date as of which the holders of Common Stock of record to
         be entitled to such dividend, distribution, redemption, rights or
         warrants are to be determined, or (y) the date on which such
         reclassification, consolidation, merger, sale, transfer, dissolution,
         liquidation or winding up is expected to become effective, and the date
         as of which it is expected that holders of Common Stock of record shall
         be entitled to exchange their shares of Common Stock for securities or
         other property deliverable upon such reclassification, consolidation,
         merger, sale, transfer, dissolution, liquidation or winding up (but no
         failure to mail such notice or any defect therein or in the mailing
         thereof shall affect the validity of the corporate action required to
         be specified in such notice).

                  (s)      The corporation shall at all times reserve and keep
         available out of its authorized but unissued Common Stock, solely for
         the purpose of effecting the conversion of the shares of Preferred
         Stock, the full number of shares of Common Stock then issuable upon the
         conversion of all outstanding shares of Preferred Stock. For the
         purpose of this subsection (s), the full number of shares of Common
         Stock issuable upon the conversion of all outstanding shares of
         Preferred Stock shall be computed as if at the time of computation of
         such number of shares of Common Stock, all outstanding shares of
         Preferred Stock were held by a single holder. The corporation shall
         from time to time, in accordance with the laws of the State of
         Delaware, increase the authorized amount of its Common Stock if at any
         time the authorized amount of its Common Stock remaining unissued shall
         not be sufficient to permit the conversion of all shares of Preferred
         Stock at the time outstanding.

8.       Sinking Fund. The Preferred Stock shall not be entitled to any
mandatory redemption or prepayment (except on liquidation, dissolution or
winding up of the affairs of the corporation) or to the benefit of any sinking
fund.

                  RESOLVED FURTHER, that, before the corporation shall issue any
shares of the Preferred Stock, a certificate pursuant to Section 151 of the
General Corporation Law of the State of Delaware, to be entitled a "Certificate
of Designation," shall be made, executed, acknowledged, filed and recorded in
accordance with the provisions of said Section 151; and that the proper officers
of the corporation are hereby authorized and directed to do all acts and things
which may be necessary or proper in their opinion to carry into effect the
purposes and intent of this and the foregoing resolutions.

                                       15
<PAGE>

                  IN WITNESS WHEREOF, this Certificate of Designation has been
made under the seal of the corporation and the hands of the undersigned, said
John D. Gibbons, Executive Vice President and Chief Financial Officer, and said
Jay D. Browning, Vice President and Corporate Secretary, respectively, of the
corporation, this 30th day of June, 2003.

                                            /s/ John D. Gibbons
                                            ------------------------------------
                                            John D. Gibbons
                                            Executive Vice President and
                                            Chief Financial Officer

/s/ Jay Browning
---------------------------------------
Jay D. Browning
Vice President and Corporate Secretary