<PAGE>

                                                                     EXHIBIT 4.1


                        STATEMENT WITH RESPECT TO SHARES
                                       OF
         SERIES A 6.00% CONVERTIBLE REDEEMABLE PREFERRED STOCK DUE 2010
                                       OF
                               VERTICALNET, INC.

                           -------------------------

                        Pursuant to Section 1522 of the

          Business Corporation Law of the Commonwealth of Pennsylvania

                           -------------------------

     VERTICALNET, INC., a Delaware corporation (the "Company") certifies that
pursuant to the authority contained in ARTICLE EIGHTH of its Amended and
Restated Articles of Incorporation, as amended (the "Articles of
Incorporation"), and in accordance with the provisions of Section 1522 of the
Business Corporation Law of the Commonwealth of Pennsylvania, the Board of
Directors of the Company at a meeting duly called and held on January 15, 2000,
duly approved and adopted the following resolution which resolution remains in
full force and effect on the date hereof:

     RESOLVED, that pursuant to the authority vested in the Board of Directors
by the Articles of Incorporation, the Board of Directors does hereby designate,
create, authorize and provide for the issue of one series of Series A Preferred
Stock having a par value of $0.01 per share, which shall be designated as Series
A 6.00% Convertible Redeemable Preferred Stock due 2010 (the "Series A Preferred
Stock") consisting of 250,000 shares, and each share of Series A Preferred Stock
shall have the following voting powers, preferences and relative, participating,
optional and other special rights, and qualifications, limitations and
restrictions thereof as follows:

     1. CERTAIN DEFINITIONS.

     Unless the context otherwise requires, the terms defined in this Section 1
shall have, for all purposes of this resolution, the meanings herein specified
(with terms defined in the singular having comparable meanings when used in the
plural).

     AFFILIATE: The term "Affiliate" of any specified Person shall mean any
other Person directly or indirectly controlling or controlled by or under direct
or indirect common control with such specified Person.  For the purposes of this
definition, "control," when used with respect to any specified Person means the
power to direct or cause the direction of the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
<PAGE>

     APPLICABLE REDEMPTION PERIOD; APPLICABLE REDEMPTION PRICE; AND
APPLICABLE REDEMPTION THRESHOLD:

     The term "Applicable Redemption Period" shall mean the 12-month period
commencing on April 1 of each of the years set forth in the table below during
which a notice for the redemption of the Series A Preferred Stock is provided in
accordance with Section 6 hereof;

     The term "Applicable Redemption Price" shall mean a price per share equal
to the redemption price specified below (expressed as a percentage of the
Liquidation Preference thereof), in each case together with accumulated and
unpaid dividends (including an amount in cash equal to a prorated dividend for
any partial dividend period) to the date of redemption if redeemed; and

     The term "Applicable Redemption Threshold" shall mean the threshold
specified below (expressed as a percentage of the Conversion Price thereof) by
which the "Current Market Price" of the Company's Common Stock (determined in
accordance with Section 7(e)(6) below) during the twenty five (25) Trading Days
immediately prior to the date of the notice of redemption for the Applicable
Redemption Period, meets or exceeds:

<TABLE>
<CAPTION>
Applicable Redemption Period        Applicable Redemption Threshold        Applicable Redemption Price
<S>                              <C>                                    <C>
             2000                                170%                                105%
             2001                                160%                                105%
             2002                                150%                                105%
             2003                                150%                                105%
             2004                                150%                                105%
             2005                                125%                                104%
             2006                                125%                                103%
             2007                                125%                                102%
             2008                                125%                                101%
             2009                                125%                                100%
On or after April 1, 2010                   Not Applicable                           100%
</TABLE>

     BOARD OF DIRECTORS: The term "Board of Directors" shall mean the Board of
Directors of the Company or a committee of such Board duly authorized to act for
it hereunder.

     BUSINESS DAY: The term "Business Day" shall mean each Monday, Tuesday,
Wednesday, Thursday and Friday which is not a day on which the banking
institutions in Philadelphia, Pennsylvania are authorized or obligated by law or
executive order to close or be closed.

     CLOSING PRICE: The term "Closing Price" shall have the meaning specified in
Section 7(e)(6).

     COMMISSION: The term "Commission" shall mean the Securities and Exchange
Commission.



                                       2
<PAGE>

     COMMON STOCK: The term "Common Stock" shall mean any stock of any class of
the Company which has no preference in respect of dividends or of amounts
payable in the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company and which is not subject to redemption by the Company.
Subject to the provisions of Section 7(f), however, shares issuable on
conversion of Series A Preferred Stock shall include only shares of the class
designated as common stock of the Company at the date of this Statement of
Designation or shares of any class or classes resulting from any
reclassification or reclassifications thereof and which have no preference in
respect of dividends or of amounts payable in the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Company and which are
not subject to redemption by the Company; provided that if at any time there
shall be more than one such resulting class, the shares of each such class then
so issuable shall be substantially in the proportion which the total number of
shares of such class resulting from all such reclassifications bears to the
total number of shares of all such classes resulting from all such
reclassifications.

     COMPANY: The term "Company" shall mean VerticalNet, Inc., a Pennsylvania
corporation, having its principal office at 700 Dresher Road, Suite 100,
Horsham, Pennsylvania, 19044 and shall include its successors and assigns.

     CONVERSION PRICE: The term "Conversion Price" shall have the meaning
specified in Section 7(d).

     CONVERTIBLE SECURITY: The term "Convertible Security" shall be any security
that, by its terms, is convertible into Common Stock at the option of the holder
thereof.

     EXCHANGE ACT: The term "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended, and the rules and regulations promulgated thereunder,
as in effect from time to time.

     ISSUE DATE: The term "Issue Date" shall mean the first date on which shares
of the Series A Preferred Stock are issued.

     LIQUIDATION PREFERENCE: The term "Liquidation Preference" shall mean $1,000
per share of Series A Preferred Stock.

     PERSON: The term "Person" shall mean a corporation, an association, a
partnership, a limited liability corporation, an individual, a joint venture, a
joint stock company, a trust, an unincorporated organization or a government or
an agency or a political subdivision thereof.

     SECURITIES ACT: The term "Securities Act" shall mean the Securities Act of
1933, as amended, and the rules and regulations promulgated thereunder, as in
effect from time to time.

     SENIOR SECURITIES: The term "Senior Securities" means any security issued
by the Company that is prior in right to the Series A Preferred Stock with
respect to dividends, distributions or liquidation preference.

                                       3
<PAGE>

     SERIES A PREFERRED STOCK: The Term "Series A Preferred Stock" shall mean
the Company's Series A 6.00% Convertible Redeemable Preferred Stock due 2010.

     SHARE REGISTER: The term "Share register" shall have the meaning specified
in Section 2(e).

     TRADING DAY: The term "Trading Day" shall have the meaning specified in
Section 7(e)(6)e.

     TRIGGER EVENT: The term "Trigger Event" shall have the meaning specified in
Section 7(e)(4).

     2. ISSUE, DESIGNATION AND FORM

     (a) The Series A Preferred Stock shall be designated as "Series A 6.00%
Convertible Redeemable Preferred Stock due 2010."

     (b) The certificates evidencing shares of Series A Preferred Stock shall be
substantially in the form set forth in Exhibit A, which is incorporated in and
made a part of this Statement of Designation. Any certificates may have such
letters, numbers or other marks of identification and such notations, legends
and endorsements as the officers executing the same may approve (execution
thereof to be conclusive evidence of such approval) and as are not inconsistent
with the provisions of this Statement of Designation, or as may be required to
comply with any law or with any rule or regulation made pursuant thereto or with
any rule or regulation of any securities exchange or automated quotation system
on which the Series A Preferred Stock may be listed, or to conform to usage.

     (c) The Series A Preferred Stock shall be issuable in registered form in
whole or fractional shares. Every certificate evidencing Series A Preferred
Stock shall be dated the date of its execution.

     (d) The certificates evidencing shares of Series A Preferred Stock shall be
signed in the name and on behalf of the Company by the facsimile signature of
its Chief Executive Officer, President, any Executive or Senior Vice President
or any Vice President (whether or not designated by a number or numbers or word
or words added before or after the title "Vice President") and attested by the
facsimile signature of its Secretary or any of its Assistant Secretaries or
Treasurer or any of its Assistant Treasurers (which may be printed, engraved or
otherwise reproduced thereon, by facsimile or otherwise).

     (e) The Company shall maintain a register (the "Share register") in which,
subject to such reasonable regulations as it may prescribe, the Company shall
provide for the registration of shares of Series A Preferred Stock and of
transfers of shares of Series A Preferred Stock. The Share register shall be in
written form or in any form capable of being converted into written form within
a reasonably prompt period of time. Upon surrender for registration or
transfer of
                                       4
<PAGE>

any shares of Series A Preferred Stock to the Share registrar or any
co-registrar, and satisfaction of the requirements for such transfer set forth
in this Section 2(e), the Company shall execute, one or more new certificates
evidencing shares of Series A Preferred Stock of any authorized denominations
and of a like aggregate Liquidation Preference and bearing such restrictive
legends as may be required by this Statement of Designation.

     (f) Shares of Series A Preferred Stock may be exchanged for other shares of
Series A Preferred Stock of any authorized denominations and of a like aggregate
Liquidation Preference, upon surrender of the Series A Preferred Stock to be
exchanged at any such office or agency maintained by the Company for such
purposes. Whenever any shares of Series A Preferred Stock are so surrendered for
exchange, the Company shall execute the shares of Series A Preferred Stock which
the holder making the exchange is entitled to receive bearing registration
numbers not contemporaneously outstanding. All certificates evidencing Series A
Preferred Stock presented or surrendered for registration of transfer or for
exchange, redemption or conversion shall (if so required by the Share registrar)
be duly endorsed, or be accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company. No service charge shall be made
for any registration of transfer or exchange of shares of Series A Preferred
Stock, but the Company may require payment of a sum sufficient to cover any tax,
assessment or other governmental charge that may be imposed in connection with
any registration or transfer or exchange of such shares. Neither the Company nor
any Share registrar shall be required to exchange or register a transfer of any
shares of Series A Preferred Stock (i) called for redemption pursuant to Section
6, (ii) surrendered for conversion pursuant to Section 7, or (iii) during the
period of time from a Record Date until the next succeeding Dividend Payment
Date.

     (g) Until the expiration of the holding period applicable to sales thereof
under Rule 144(k) under the Securities Act (or any successor provision), any
certificate evidencing shares of Series A Preferred Stock (and all securities
issued in exchange therefor or substitution thereof, other than Common Stock, if
any, issued upon conversion thereof, which shall bear the legend set forth in
Section 2(h), if applicable) shall bear a legend in substantially the following
form, unless such Series A Preferred Stock has been sold pursuant to a
registration statement that has been declared effective under the Securities Act
(and which continues to be effective at the time of such transfer), or unless
otherwise agreed by the Company in writing:

     THE SERIES A PREFERRED STOCK EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER
     THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
     SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD UNLESS SUCH
     STOCK HAS BEEN REGISTERED UNDER THE SECURITIES ACT, OR SOLD PURSUANT TO AN
     APPLICABLE EXEMPTION AND THE HOLDER PROVIDES TO VERTICALNET, INC. A LEGAL
     OPINION FROM LEGAL COUNSEL REASONABLY ACCEPTABLE TO VERTICALNET, INC. THAT
     SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A
     TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
     ACT.


                                       5
<PAGE>

Any Series A Preferred Stock (or security issued in exchange or substitution
therefor) as to which such restrictions on transfer shall have expired in
accordance with their terms or as to the conditions for removal of the foregoing
legend set forth therein have been satisfied may, upon surrender of such Series
A Preferred Stock for exchange to the Share registrar in accordance with the
provisions of this Section 2(g), be exchanged for a new Series A Preferred
Stock, of like tenor and Liquidation Preference, which shall bear a restrictive
legend containing only the final sentence of the above legend.

     (h) Until the expiration of the holding period applicable to sales thereof
under Rule 144(k) under the Securities Act (or any successor provision), any
stock certificate representing Common Stock issued upon conversion of such
Series A Preferred Stock shall bear a legend in substantially the following
form, unless such Common Stock has been sold pursuant to a registration
statement that has been declared effective under the Securities Act (and which
continues to be effective at the time of such transfer) or such Common Stock has
been issued upon conversion of Series A Preferred Stock that have been
transferred pursuant to a registration statement that has been declared
effective under the Securities Act, or unless otherwise agreed by the Company in
writing with written notice thereof to the transfer agent:

     THE COMMON STOCK EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE
     SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
     SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD UNLESS SUCH
     STOCK HAS BEEN REGISTERED UNDER THE SECURITIES ACT, OR SOLD PURSUANT TO AN
     APPLICABLE EXEMPTION AND THE HOLDER PROVIDES TO VERTICALNET, INC. A LEGAL
     OPINION FROM LEGAL COUNSEL REASONABLY ACCEPTABLE TO VERTICALNET, INC. THAT
     SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A
     TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
     ACT.


Any such Common Stock as to which such restrictions on transfer shall have
expired in accordance with their terms or as to which the conditions for removal
of the foregoing legend set forth therein have been satisfied may, upon
surrender of the certificates representing such shares of Common Stock for
exchange in accordance with the procedures of the transfer agent for the Common
Stock, be exchanged for a new certificate or certificates for a like number of
shares of Common Stock, which shall not bear the restrictive legend required by
this Section 2(h).

     (i) In case any certificate representing shares of Series A Preferred Stock
shall become mutilated or be destroyed, lost or stolen, the Company in its
discretion may execute a new certificate representing shares of Series A
Preferred Stock, bearing a number not contemporaneously outstanding, in exchange
and substitution for the mutilated certificate, or in lieu of and in
substitution for the certificate so destroyed, lost or stolen. In every case the
applicant for a substituted certificate shall furnish to the Company, such
security or indemnity as may be required by them to save each of them harmless
for any loss, liability, cost or expense caused by or connected with such
substitution, and, in every case of destruction, loss or theft, the

                                       6
<PAGE>

applicant shall also furnish to the Company, evidence to their satisfaction
of the destruction, loss or theft of such certificate and of the ownership
thereof.

     (j) Following receipt by the Company of satisfactory security or indemnity
and evidence, as described in the preceding paragraph, any such substituted
certificate and make available for delivery such certificate. Upon the issuance
of any substituted certificate, the Company may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses connected therewith. In case any
certificate which has been called for redemption or has been tendered for
redemption (and not withdrawn) or is about to be converted into Common Stock
shall become mutilated or be destroyed, lost or stolen, the Company may, instead
of issuing a substitute certificate, pay or authorize the payment of or convert
or authorize the conversion of the same (without surrender thereof except in the
case of a mutilated certificate), as the case may be, if the applicant for such
payment or conversion shall furnish to the Company such security or indemnity as
may be required by them to save each of them harmless for any loss, liability,
cost or expense caused by or connected with such substitution, and, in case of
destruction, loss or theft, evidence satisfactory to the Company of the
destruction, loss or theft of such certificate and of the ownership thereof.

     (k) All certificates representing shares of Series A Preferred Stock
surrendered for the purpose of payment, redemption, conversion, exchange or
registration of transfer, shall, if surrendered to the Company or any paying
agent or any stock registrar or any conversion agent, be surrendered to the
Company and promptly canceled by it, or, if surrendered to the Company, shall be
promptly canceled by it, and no Series A Preferred Stock shall be issued in lieu
thereof except as expressly permitted by any of the provisions of this Statement
of Designation.

     (l) The Company in issuing the Series A Preferred Stock may use "CUSIP"
numbers, and may use "CUSIP" numbers in notices of redemption as a convenience
to holders.

     3. RANKING.

     The Series A Preferred Stock shall rank, with respect to dividend
distributions and distributions upon the liquidation, winding-up and dissolution
of the Company, (i) senior to all classes of common stock of the Company and to
each other class of capital stock of the Company outstanding on the date hereof
(collectively referred to with the Common Stock of the Company as "Junior
Securities"); and (ii) on a parity with any additional shares of Preferred Stock
issued by the Company in the future and any other class of capital stock or
series of Preferred Stock issued by the Company in the future, the terms of
which expressly provide that such class or series will rank on a parity with the
Series A Preferred Stock as to dividend distributions and distributions upon the
liquidation, winding-up and dissolution of the Company (collectively referred to
as "Parity Securities"). The Company shall not issue any shares of Senior
Securities or Parity Securities (other than additional shares of Series A
Preferred Stock) without the consent of holders of at least seventy-five percent
(75%) of the outstanding shares of Series A Preferred Stock.

                                       7
<PAGE>

     4. DIVIDENDS.

     (a) The holders of shares of the Series A Preferred Stock (other than
shares as to which conversion is deemed effective pursuant to Section 7 and as
to which all accrued dividends have been paid) shall be entitled to receive,
when, as and if dividends are declared by the Board of Directors out of funds of
the Company legally available therefor, cumulative preferential dividends from
the Issue Date accumulating at the rate of six percent (6.00%) of the
Liquidation Preference per share per annum, payable quarterly in arrears on each
January 1, April 1, July 1 or October 1 of each year or, if any such date is not
a Business Day, on the next succeeding Business Day (each, a "Dividend Payment
Date"), to the holders of record of such shares of Series A Preferred Stock as
of the next preceding December 15, March 15, June 15 or September 15 (each, a
"Record Date"). Dividends may be paid, at the Company's option, to any holder of
Series A Preferred Stock (i) in cash, (ii) by the issuance of additional shares
of Series A Preferred Stock having an aggregate Liquidation Preference (rounded
to the nearest $1,000.00) equal to the amount of such dividends payable on all
shares of Series A Preferred Stock held by such holder, (iii) or by the issuance
of shares of the Company's Common Stock, with the number of shares of Common
Stock issued to be determined based upon the Current Market Price of the
Company's Common Stock (determined in accordance with Section 7(e)(6) below)
during the twenty-five (25) Trading Days immediately prior to the Dividend
Payment Date. The issuance of such additional shares of Series A Preferred Stock
and/or Common Stock shall constitute "payment" of the related dividend for all
purposes of this Statement of Designation. The first dividend payment on the
Series A Preferred Stock shall be payable on July 1, 2000 (except with respect
to shares of Series A Preferred Stock converted or redeemed prior to such date,
if any). Dividends payable on the Series A Preferred Stock will be computed on
the basis of a 360-day year consisting of twelve (12) thirty (30) day months and
will be deemed to accumulate on a daily basis on the Liquidation Preference of
the Series A Preferred Stock.

     (b) Dividends on the Series A Preferred Stock shall accrue whether or not
the Company has earnings or profits, whether or not there are funds legally
available for the payment of such dividends and whether or not dividends are
declared. Dividends will accumulate to the extent they are not paid on the
Dividend Payment Date for the period to which they relate.

     (c) No dividend whatsoever shall be declared or paid upon, or any sum set
apart for the payment of dividends upon, any outstanding share of the Series A
Preferred Stock with respect to any dividend period unless all dividends for all
preceding dividend periods have been declared and paid, or declared and a
sufficient sum set apart for the payment of such dividend, upon all outstanding
shares of Series A Preferred Stock. Unless full cumulative dividends on all
outstanding shares of Series A Preferred Stock for all past dividend periods
shall have been declared and paid, or declared and a sufficient sum for the
payment thereof set apart, then: (i) no cash dividend (other than a dividend
payable solely in shares of any Junior Securities) shall be declared or paid
upon, or any sum set apart for the payment of dividends upon, any shares of
Junior Securities; (ii) no other distribution shall be declared or made upon, or
any sum set apart for the payment of any distribution upon, any shares of Junior
Securities; and (iii) no monies shall be paid into or set apart or made
available for a sinking or other like fund for the purchase, redemption or other
acquisition or retirement for value of any shares of Junior

                                       8
<PAGE>

Securities by the Company or any of its Subsidiaries, except in the ordinary
course of the Company's business. Holders of the Series A Preferred Stock will
not be entitled to any dividends, whether payable in cash, property or stock, in
excess of the full cumulative dividends as herein described.

     5. LIQUIDATION RIGHTS.

     Upon any voluntary or involuntary liquidation, dissolution or winding- up
of the Company or reduction or decrease in its capital stock resulting in a
distribution of assets to the holders of any class or series of the Company's
capital stock (other than shares of Senior Securities), each holder of shares of
the Series A Preferred Stock will be entitled to payment out of the assets of
the Company available for distribution of an amount equal to the Liquidation
Preference per share of Series A Preferred Stock held by such holder, plus all
accumulated and unpaid dividends, if any, to the date fixed for liquidation,
dissolution, winding-up or reduction or decrease in capital stock, before any
distribution is made on any Junior Securities, including, without limitation,
Common Stock of the Company. After payment in full of the Liquidation Preference
and all accumulated and unpaid dividends, if any, to which holders of Series A
Preferred Stock are entitled, such holders will not be entitled to any further
participation in any distribution of assets of the Company. If, upon any
voluntary or involuntary liquidation, dissolution or winding-up of the Company,
the amounts payable with respect to the Series A Preferred Stock and all other
Parity Securities are not paid in full, the holders of the Series A Preferred
Stock and the Parity Securities will share equally and ratably in any
distribution of assets of the Company in proportion to the full Liquidation
Preference and accumulated and unpaid dividends, if any, to which each is
entitled. However, neither the voluntary sale, conveyance, exchange or transfer
(for cash, shares of stock, securities or other consideration) of all or
substantially all of the property or assets of the Company nor the consolidation
or merger of the Company with or into one or more Persons will be deemed to be a
voluntary or involuntary liquidation, dissolution or winding-up of the Company
or reduction or decrease in capital stock, unless such sale, conveyance,
exchange or transfer shall be in connection with a liquidation, dissolution or
winding-up of the business of the Company or reduction or decrease in capital
stock.

     6. REDEMPTION.

     (a) On April 1, 2010, at the election of the holder of the Series A
Preferred Stock, the Company shall be required to redeem (subject to the legal
availability of funds therefor) all outstanding shares of Series A Preferred
Stock at the Applicable Redemption Price. The Company shall not be required to
make sinking fund payments with respect to the Series A Preferred Stock.

     (b) In addition, at the option of the Company each share of Series A
Preferred Stock will be subject to redemption at the Applicable Redemption Price
if the Current Market Price of the Company's Common Stock during the twenty-five
(25) Trading Days immediately prior to the "Redemption Date" (as defined in
Section 6(e) below) meets or exceeds the Applicable Redemption Threshold;
provided, however, that notwithstanding any other provision

                                       9
<PAGE>

of this Section 6, as a condition to the Company's right to pay the Applicable
Redemption Price for the Applicable Redemption Periods commencing on April 1,
2000, 2001, 2002, 2003 and 2004, pursuant to this Section 6(b) in Common Stock,
such Common Stock must be registered on a registration statement that has been
declared effective under the Securities Act on or before the first anniversary
of the Issue Date and that continues to be effective at the time of the issuance
of such Common Stock and for a period of two (2) years thereafter.

     (c) In case of redemption of less than all of the shares of Series A
Preferred Stock at the time outstanding, the shares to be redeemed shall be
selected pro rata or by lot as determined by the Company in its sole discretion.

     (d) Subject to the satisfaction of the provisions of Section 6(b) hereof,
the Company may elect to pay the Applicable Redemption Price either in (i) cash
or (ii) in shares of the Company's Common Stock based upon the Current Market
Price (determined as set forth in Section 7(e)(6)) of the Common Stock during
the twenty five (25) Trading Days immediately prior to the date of mailing of
the redemption notice.

     (e) Not less than thirty (30) nor more than sixty (60) days prior to the
date specified for redemption in such notice (the "Redemption Date"), (i) notice
of any redemption pursuant to Section 6(a) shall be sent by or on behalf of the
holders of the Series A Preferred Stock by first class mail, postage prepaid to
the Company at its corporate offices, and (ii) notice of any redemption pursuant
to Section 6(b) shall be sent by or on behalf of the Company to the holder of
the Series A Preferred Stock by first class mail, postage prepaid, to all
holders of record of the Series A Preferred Stock at their last addresses as
they shall appear on the books of the Company; provided, however, that no
failure to give such notice or any defect therein or in the mailing thereof
shall affect the validity of the proceedings for the redemption of any shares of
Series A Preferred Stock except as to the holder to whom the Company has failed
to give notice or except as to the holder to whom notice was defective. Such
notice shall state: (i) the Redemption Date; (ii) the Applicable Redemption
Price; (iii) the number of shares of Series A Preferred Stock to be redeemed
and, if less than all shares held by such holder are to be redeemed, the number
of such shares to be redeemed; (iv) the place or places where certificates for
such shares are to be surrendered for payment of the Applicable Redemption
Price; and (v) that dividends on the shares to be redeemed will cease to
accumulate on the Redemption Date. Upon the mailing of any such notice of
redemption, the Company shall become obligated to redeem at the time of
redemption specified thereon all shares called for redemption.

     (f) If (i) notice has been mailed in accordance with Section 6(e) above,
(ii) the conditions set forth in Section 6(b) have been satisfied by the
Company, as applicable, and (iii) provided that on or before the Redemption Date
specified in such notice, all funds necessary for such redemption shall have
been set aside by the Company, separate and apart from its other funds in trust
for the pro rata benefit of the holders of the shares so called for redemption,
so as to be, and to continue to be available therefor, then, from and after the
Redemption Date, dividends on the shares of the Series A Preferred Stock so
called for redemption shall cease to accumulate, and said shares shall no longer
be deemed to be outstanding and shall not have the status of shares of Series A
Preferred Stock, and all rights of the holders thereof as stockholders



                                       10
<PAGE>

of the Company (except the right to receive from the Company the Applicable
Redemption Price) shall cease. Upon surrender, in accordance with said notice,
of the certificates for any shares so redeemed (properly endorsed or assigned
for transfer, if the Company shall so require and the notice shall so state),
such shares shall be redeemed by the Company at the Applicable Redemption Price.
In case fewer than all the shares represented by any such certificate are
redeemed, a new certificate or certificates shall be issued representing the
unredeemed shares without cost to the holder thereof.

     (g) All shares of Series A Preferred Stock redeemed pursuant to this
Section 6 shall be restored to the status of authorized and unissued shares of
Series A Preferred Stock, without designation as to series and may thereafter be
reissued as shares of any series of preferred stock other than shares of Series
A Preferred Stock.

     7. CONVERSION

     (a) Subject to and upon compliance with the provisions of this Statement of
Designation, the holder of any Series A Preferred Stock shall have the right, at
its option, at any time after the date of this Statement of Designation to
convert any shares of Series A Preferred Stock, into that number of fully paid
and non-assessable shares of Common Stock (as such shares shall then be
constituted) obtained by dividing the aggregate Liquidation Preference on the
shares of Series A Preferred Stock to be converted (plus, in the event such
shares are converted on a date other than a Dividend Payment Date, accrued and
unpaid dividends on such Series A Preferred Stock through the date such Series A
Preferred Stock is deemed to be converted in accordance with this Section 7,
unless the Company shall elect to pay such accrued and unpaid dividend in cash
as set forth in Section 4(a) above) by the Conversion Price in effect at such
time, by surrender of the certificate evidencing such shares of Series A
Preferred Stock so to be converted in the manner provided. A holder of Series A
Preferred Stock is not entitled to any rights of a holder of Common Stock until
such holder has converted shares of Series A Preferred Stock to Common Stock,
and only to the extent such Series A Preferred Stock are deemed to have been
converted to Common Stock under this Section 7.

     (b) In order to exercise the conversion privilege with respect to any
shares of Series A Preferred Stock, the holder of shares to be converted shall
surrender such shares, duly endorsed, at an office or agency maintained by the
Company for such purposes, and shall give written notice of conversion in the
form provided on the certificate evidencing the Series A Preferred Stock (or
such other notice which is acceptable to the Company) to the office or agency
that the holder elects to convert shares of Series A Preferred Stock. Such
notice shall also state the name or names (with address or addresses) in which
the certificate or certificates for shares of Common Stock which shall be
issuable on such conversion shall be issued, and shall be accompanied by
transfer taxes, if required pursuant to Section 7(g). Each share of Series A
Preferred Stock surrendered for conversion shall, unless the shares issuable on
conversion are to be issued in the same name as the registration of such Series
A Preferred Stock, be duly endorsed by, or be accompanied by instruments of
transfer in form satisfactory to the Company duly executed by, the holder or his
duly authorized attorney. As promptly as practicable after satisfaction of the
requirements for conversion set forth above, subject to compliance with any


                                       11
<PAGE>

restrictions on transfer if shares issuable on conversion are to be issued in a
name other than that of the holder (as if such transfer were a transfer of the
Series A Preferred Stock), the Company shall issue and shall deliver to such
holder at the office or agency maintained by the Company for such purpose, a
certificate or certificates for the number of full shares of Common Stock to be
issued by the Company upon the conversion of shares of Series A Preferred Stock
in accordance with the provisions of this Section 7 and a check or cash in
respect of any fractional interest in respect of a share of Common Stock arising
upon such conversion, as provided in Section 7(c), and, if the Company elects to
pay accrued and unpaid dividends on such shares in cash pursuant to Section
4(a), a check or cash in respect of such amounts. In case any Series A Preferred
Stock shall be surrendered for partial conversion, the Company shall execute and
deliver to the holder of the Series A Preferred Stock so surrendered, without
charge to the holder, a new certificate evidencing the unconverted shares of
Series A Preferred Stock evidenced by the surrendered certificate.

     Each conversion shall be deemed to have been effected as to any such Series
A Preferred Stock on the date on which the requirements set forth above in this
Section 7(b) have been satisfied as to such Series A Preferred Stock, and the
Person in whose name any certificate or certificates for shares of Common Stock
shall be issuable upon such conversion shall be deemed to have become on said
date the holder of record of the shares represented thereby; provided, however,
that any such surrender on any date when the stock transfer books of the Company
shall be closed shall constitute the Person in whose name the certificates are
to be issued as the record holder thereof for all purposes on the next
succeeding day on which such stock transfer books are open, but such conversion
shall be at the Conversion Price in effect on the date upon which such Series A
Preferred Stock shall be surrendered.

     (c) No fractional shares of Common Stock or scrip representing fractional
shares shall be issued upon conversion of Series A Preferred Stock. If any
fractional share of stock would be issuable upon the conversion of any share or
shares of Series A Preferred Stock, the Company shall make an adjustment and
payment therefor in cash at the current market price thereof to the holder of
such shares. The current market price of a share of Common Stock shall be the
Closing Price on the last Business Day immediately preceding the day on which
the Series A Preferred Stock is deemed to have been converted.

     (d) The conversion price applicable to the Series A Preferred Stock shall
be $86.875 (herein called the "Conversion Price"), subject to adjustment as
provided in this Section 7.

     (e) The Conversion Price shall be adjusted from time to time by the Company
as follows:

         (1) In case the Company shall hereafter pay a dividend or make a
distribution to all holders of the outstanding Common Stock in shares of Common
Stock, the Conversion Price in effect at the opening of business on the date
following the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution shall be reduced by multiplying such
Conversion Price by a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding at the close of business on the date fixed
for
                                       12
<PAGE>

such determination and the denominator shall be the sum of such number of shares
and the total number of shares constituting such dividend or other distribution,
such reduction to become effective immediately after the opening of business on
the day following the date fixed for such determination. The Company will not
pay any dividend or make any distribution on shares of Common Stock held in the
treasury of the Company. If any dividend or distribution of the type described
in this Section 7(e)(1) is declared but not so paid or made, the Conversion
Price shall again be adjusted to the Conversion Price which would then be in
effect if such dividend or distribution had not been declared.

         (2) In case the Company shall issue rights or warrants to all holders
of its outstanding shares of Common Stock entitling them (for a period expiring
within forty-five (45) days after the date fixed for determination of
stockholders entitled to receive such rights or warrants) to subscribe for or
purchase shares of Common Stock at a price per share less than the Current
Market Price (as defined below) on the date fixed for determination of
stockholders entitled to receive such rights or warrants, the Conversion Price
shall be adjusted so that the same shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to the date fixed
for determination of stockholders entitled to receive such rights or warrants by
a fraction, the numerator of which shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for determination of
stockholders entitled to receive such rights and warrants plus the number of
shares which the aggregate offering price of the total number of shares so
offered would purchase at such Current Market Price, and the denominator shall
be the number of shares of Common Stock outstanding on the date fixed for
determination of stockholders entitled to receive such rights and warrants plus
the total number of additional shares of Common Stock offered for subscription
or purchase. Such adjustment shall be successively made whenever any such rights
and warrants are issued, and shall become effective immediately after the
opening of business on the day following the date fixed for determination of
stockholders entitled to receive such rights or warrants. To the extent that
shares of Common Stock are not delivered after the expiration of such rights or
warrants, the Conversion Price shall be readjusted to the Conversion Price which
would then be in effect had the adjustments made upon the issuance of such
rights or warrants been made on the basis of delivery of only the number of
shares of Common Stock actually delivered. In the event that such rights or
warrants are not so issued, the Conversion Price shall again be adjusted to be
the Conversion Price which would then be in effect if such date fixed for the
determination of stockholders entitled to receive such rights or warrants had
not been fixed. In determining whether any rights or warrants entitle the
holders to subscribe for or purchase shares of Common Stock at less than such
Current Market Price, and in determining the aggregate offering price of such
shares of Common Stock, there shall be taken into account any consideration
received by the Company for such rights or warrants, the value of such
consideration, if other than cash, to be determined by the Board of Directors.

         (3) In case outstanding shares of Common Stock shall be subdivided
into a greater number of shares of Common Stock, the Conversion Price in effect
at


                                       13
<PAGE>

the opening of business on the day following the day upon which such subdivision
becomes effective shall be proportionately reduced, and conversely, in case
outstanding shares of Common Stock shall be combined into a smaller number of
shares of Common Stock, the Conversion Price in effect at the opening of
business on the day following the day upon which such combination becomes
effective shall be proportionately increased, such reduction or increase, as the
case may be, to become effective immediately after the opening of business on
the day following the day upon which such subdivision or combination becomes
effective.

         (4) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock shares of any class of capital stock of the
Company (other than any dividends or distributions to which Section 7(e)(1)
applies) or evidences of its indebtedness or assets (including securities, but
excluding any rights or warrants referred to in Section 7(e)(2), and excluding
any dividend or distribution (x) paid exclusively in cash or (y) referred to in
Section 7(e)(1) (any of the foregoing hereinafter in this Section 7(e)(4) called
the "Securities")), then, in each such case (unless the Company elects to
reserve such Securities for distribution to the holders upon the conversion of
the shares of Series A Preferred Stock so that any such holder converting shares
will receive upon such conversion, in addition to the shares of Common Stock to
which such holder is entitled, the amount and kind of such Securities which such
holder would have received if such holder had converted its shares of Series A
Preferred Stock into Common Stock immediately prior to the record date (as
defined in Section 7(e)(6) for such distribution of the Securities)), the
Conversion Price shall be reduced so that the same shall be equal to the price
determined by multiplying the Conversion Price in effect on the record date with
respect to such distribution by a fraction, the numerator of which shall be the
Current Market Price per share of the Common Stock on such record date less the
fair market value (as determined by the Board of Directors, whose determination
shall be conclusive, and described in a resolution of the Board if Directors) on
the record date of the portion of the Securities so distributed applicable to
one share of Common Stock and the denominator shall be the Current Market Price
per share of the Common Stock, such reduction to become effective immediately
prior to the opening of business on the day following such record date;
provided, however, that in the event the then fair market value (as so
determined) of the portion of the Securities so distributed applicable to one
share of Common Stock is equal to or greater than the Current Market Price of
the Common Stock on the record date, in lieu of the foregoing adjustment,
adequate provision shall be made so that each holder shall have the right to
receive upon conversion the amount of Securities such holder would have received
had such holder converted each share of Series A Preferred Stock on the record
date. In the event that such dividend or distribution is not so paid or made,
the Conversion Price shall again be adjusted to be the Conversion Price which
would then be in effect if such dividend or distribution had not been declared.
If the Board of Directors determines the fair market value of any distribution
for purposes of this Section 7(e)(4) by reference to the actual or when issued
trading market for any securities, it must in doing so consider the prices in
such market over the same period used in computing the Current Market Price of
the Common Stock.

     In the event that the Company implements a stockholders' rights plan
("Rights Plan"), such Rights Plan must provide that, subject to customary
exceptions, upon conversion of the shares of Series A Preferred Stock the
holders will receive, in addition to the Common Stock issuable upon conversion,
such rights whether or not such rights have separated from the Common Stock at
the time of such conversion.

                                       14
<PAGE>

     Rights or warrants distributed by the Company to all holders of Common
Stock entitling the holders thereof to subscribe for or purchase shares of the
Company's capital stock (either initially or under certain circumstances), which
rights or warrants, until the occurrence of a specified event or events
("Trigger Event"): (i) are deemed to be transferred with such shares of Common
Stock; (ii) are not exercisable; and (iii) are also issued in respect of future
issuances of Common Stock, shall be deemed not to have been distributed for
purposes of this Section 7(e) (and no adjustment to the Conversion Price under
this Section 7(e) will be required) until the occurrence of the earliest Trigger
Event, whereupon such rights and warrants shall be deemed to have been
distributed and an appropriate adjustment (if any is required) to the Conversion
Price shall be made under this Section 7(e)(4). If any such right or warrant,
including any such existing rights or warrants distributed prior to the date of
this Certificate of Designation, are subject to events, upon the occurrence of
which such rights or warrants become exercisable to purchase different
securities, evidences of indebtedness or other assets, then the date of the
occurrence of any and each such event shall be deemed to be the date of
distribution and record date with respect to new rights or warrants with such
rights (and a termination or expiration of the existing rights or warrants
without exercise by any of the holders thereof). In addition, in the event of
any distribution (or deemed distribution) of rights or warrants, or any Trigger
Event or other event (of the type described in the preceding sentence) with
respect thereto that was counted for purposes of calculating a distribution
amount for which an adjustment to the Conversion Price under this Section 7(e)
was made, (i) in the case of any such rights or warrants which shall all have
been redeemed or repurchased without exercise by any holders thereof, the
Conversion Price shall be readjusted upon such final redemption or repurchase to
give effect to such distribution or Trigger Event, as the case may be, as though
it were a cash distribution, equal to the per share redemption or repurchase
price received by a holder or holders of Common Stock with respect to such
rights or warrants (assuming such holder had retained such rights or warrants),
made to all holders of Common Stock as of the date of such redemption or
repurchase, and (ii) in the case of such rights or warrants which shall have
expired or been terminated without exercise by any holders thereof, the
Conversion Price shall be readjusted as if such rights and warrants had not been
issued.

     For purposes of this Section 7(e)(4) and Sections 7(e)(1) and 7(e)(2), any
dividend or distribution to which this Section 7(e)(4) is applicable that also
includes shares of Common Stock, or rights or warrants to subscribe for or
purchase shares of Common Stock (or both), shall be deemed instead to be (i) a
dividend or distribution of the evidences of indebtedness, assets or shares of
capital stock other than such shares of Common Stock or rights or warrants (and
any Conversion Price reduction required by this Section 7(e)(4) with respect to
such dividend or distribution shall then be made) immediately followed by (ii) a
dividend or distribution of such shares of Common Stock or such rights or
warrants (and any further Conversion Price reduction required by Sections
7(e)(1), and (2) with respect to such dividend or distribution shall then be
made), except (A) the record date of such dividend or distribution shall be
substituted as "the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution" and "the date fixed for such
determination" within the meaning of Sections 7(e)(1) and (2), and (B) any
shares of Common Stock included in such dividend or distribution shall not be
deemed "outstanding at the close of business on the date fixed for such
determination" within the meaning of Section 7(e)(1).

                                       15
<PAGE>

         (5) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock, or to all holders of any series of preferred
stock or other equity security with respect to which dividends are payable, cash
(excluding any dividend or distribution in connection with the liquidation,
dissolution or winding up of the Company, whether voluntary or involuntary),
then, in such case, the Conversion Price shall be reduced so that the same shall
equal the price determined by multiplying the Conversion Price in effect
immediately prior to the close of business on such record date by a fraction,
the numerator of which shall be the Current Market Price of the Common Stock on
the record date less the amount of cash so distributed (and not excluded as
provided above) applicable to one share of Common Stock and the denominator
shall be such Current Market Price of the Common Stock, such reduction to be
effective immediately prior to the opening of business on the day following the
record date; provided, however, that in the event the portion of the cash so
distributed applicable to one share of Common Stock is equal to or greater than
the Current Market Price of the Common Stock on the record date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each holder shall
have the right to receive upon conversion the amount of cash such holder would
have received had such holder converted each share of Series A Preferred Stock
on the record date. In the event that such dividend or distribution is not so
paid or made, the Conversion Price shall again be adjusted to be the Conversion
Price which would then be in effect if such dividend or distribution had not
been declared. If any adjustment is required to be made as set forth in this
Section 7(e)(5) as a result of a distribution that is a quarterly dividend, such
adjustment shall be based upon the amount by which such distribution exceeds the
amount of the quarterly cash dividend permitted to be excluded pursuant hereto.
If an adjustment is required to be made as set forth in this Section 7(e)(5)
above as a result of a distribution that is not a quarterly dividend, such
adjustment shall be based upon the full amount of the distribution.

         (6) For purposes of this Section 7(e), the following terms shall have
the meaning indicated:

"Closing Price" with respect to any securities on any day shall mean the closing
sale price regular way on such day or, in case no such sale takes place on such
day, the average of the reported closing bid and asked prices, regular way, in
each case on the NASDAQ National Market ("NNM"), or, if such security is not
listed or admitted to trading on NNM, on the principal national security
exchange or quotation system on which such security is quoted or listed or
admitted to trading, or, if not quoted or listed or admitted to trading on any
national securities exchange or quotation system, the average of the closing bid
and asked prices of such security on the over-the-counter market on the day in
question as reported by the National Quotation Bureau Incorporated, or a similar
generally accepted reporting service, or if not so available, in such manner as
furnished by any National Association of Securities Dealers firm selected from
time to time by the Board of Directors for that purpose, or a price determined
in good faith by the Board of Directors or, to the extent permitted by
applicable law, a duly authorized committee thereof, whose determination shall
be conclusive.

"Current Market Price" shall mean the average of the daily Closing Prices per
share of Common Stock for the twenty-five (25) consecutive Trading Days
immediately prior to the date in question; provided,

                                       16
<PAGE>

however, that (1) if the "ex" date (as hereinafter defined) for any event that
requires an adjustment to the Conversion Price pursuant to Section 7(e)(1), (2),
(3), (4) or (5) occurs during such twenty-five (25) consecutive Trading Days,
the Closing Price for each Trading Day prior to the "ex" date for such other
event shall be adjusted by multiplying such Closing Price by the same fraction
by which the Conversion Price is so required to be adjusted as a result of such
other event, or (2) if the "ex" date for any event that requires an adjustment
to the Conversion Price pursuant to Section 7(e)(1), (2), (3), (4) or (5) occurs
on or after the "ex" date for the issuance or distribution requiring such
computation and prior to the day in question, the Closing Price for each Trading
Day on and after the "ex" date for such other event shall be adjusted by
multiplying such Closing Price by the reciprocal of the fraction by which the
Conversion Price is so required to be adjusted as a result of such other event.
For purposes of any computation under Section 7(e)(5), the Current Market Price
of the Common Stock on any date shall be deemed to be the average of the daily
Closing Prices per share of Common Stock for such day and the next two
succeeding Trading Days. For purposes of this paragraph, the term "ex" date, (1)
when used with respect to any issuance or distribution, means the first date on
which the Common Stock trades regular way on the relevant exchange or in the
relevant market from which the Closing Price was obtained without the right to
receive such issuance or distribution, and (2) when used with respect to any
subdivision or combination of shares of Common Stock, means the first date on
which the Common Stock trades regular way on such exchange or in such market
after the time at which such subdivision or combination becomes effective.

"fair market value" shall mean the amount which a willing buyer would pay a
willing seller in an arm's length transaction.

"record date" shall mean, with respect to any dividend, distribution or other
transaction or event in which the holders of Common Stock have the right to
receive any cash, securities or other property or in which the Common Stock (or
other applicable security) is exchanged for or converted into any combination of
cash, securities or other property, the date fixed for determination of
stockholders entitled to receive such cash, securities or other property
(whether such date is fixed by the Board of Directors or by statute, contract or
otherwise).

"Trading Day" shall mean (x) if the applicable security is listed or admitted
for trading on the New York Stock Exchange or another national security
exchange, a day on which the New York Stock Exchange or another national
security exchange is open for business or (y) if the applicable security is
quoted on the NNM, a day on which trades may be made on thereon or (z) if the
applicable security is not so listed, admitted for trading or quoted, any day
other than a Saturday or Sunday or a day on which banking institutions in the
Commonwealth of Pennsylvania are authorized or obligated by law or executive
order to close.

         (7) To the extent permitted by applicable law, the Company from time to
time may reduce the Conversion Price by any amount for any period of time if the
period is at least twenty (20) days, the reduction is irrevocable during the
period and the Board of Directors shall have made a determination that such
reduction would be in the best interests of the Company, which determination
shall be conclusive. Whenever the Conversion Price is reduced pursuant to the
preceding sentence, the Company shall mail to holders of record of the Series A
Preferred Stock a notice of the reduction at least fifteen (15) days prior to
the date
                                       17
<PAGE>

the reduced Conversion Price takes effect, and such notice shall state the
reduced Conversion Price and the period during which it will be in effect.

         (8) No adjustment in the Conversion Price shall be required unless such
adjustment would require an increase or decrease of at least one percent (1%) in
such price; provided, however, that any adjustments which by reason of this
Section 7(e)(8) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations under this Section 7
shall be made by the Company and shall be made to the nearest cent or to the
nearest one-hundredth (1/100) of a share, as the case may be. No adjustment need
be made for rights to purchase Common Stock pursuant to a Company plan for
reinvestment of dividends or interest. To the extent the Series A Preferred
Stock become convertible into cash, assets, property or securities (other than
capital stock of the Company), no adjustment need be made thereafter as to the
cash, assets, property or such securities. Interest will not accrue on the cash.

         (9) Whenever the Conversion Price is adjusted as herein provided, the
Company shall prepare a notice of such adjustment of the Conversion Price
setting forth the adjusted Conversion Price and the date on which each
adjustment becomes effective and shall mail such notice of such adjustment of
the Conversion Price to each holder of Series A Preferred Stock at the holder's
last address appearing on the Share register, within twenty (20) days after the
effectiveness thereof. Failure to deliver such notice shall not affect the
legality or validity of any such adjustment.

        (10) In any case in which this Section 7(e) provides that an adjustment
shall become effective immediately after a record date for an event, the Company
may defer until the occurrence of such event (i) issuing to the holder of any
Series A Preferred Stock converted after such record date and before the
occurrence of such event the additional shares of Common Stock issuable upon
such conversion by reason of the adjustment required by such event over and
above the Common Stock issuable upon such conversion before giving effect to
such adjustment, and (ii) paying to such holder any amount in cash in lieu of
any fraction pursuant to Section 7(c).

        (11) For purposes of this Section 7(e), the number of shares of Common
Stock at any time outstanding shall not include shares held in the treasury of
the Company but shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of shares of Common Stock. The Company will not pay
any dividend or make any distribution on shares of Common Stock held in the
treasury of the Company.

     (f) If any of the following events occur, namely (i) any reclassification
or change of the outstanding shares of Common Stock (other than a subdivision or
combination to which Section 7(e)(3) applies), (ii) any consolidation, merger or
combination of the Company with another corporation as a result of which holders
of Common Stock shall be entitled to receive stock, securities or other property
or assets (including

                                       18
<PAGE>

cash) with respect to or in exchange for such Common Stock, or (iii) any sale or
conveyance of the properties and assets of the Company as, or substantially as,
an entirety to any other corporation as a result of which holders of Common
Stock shall be entitled to receive stock, securities or other property or assets
(including cash) with respect to or in exchange for such Common Stock, then the
Company or the successor or purchasing corporation, as the case may be, shall
amend this Certificate of Designation to provide that such shares of Series A
Preferred Stock shall be convertible into the kind and amount of shares of stock
and other securities or property or assets (including cash) receivable upon such
reclassification, change, consolidation, merger, combination, sale or conveyance
by a holder of a number of shares of Common Stock issuable upon conversion of
such shares of Series A Preferred Stock (assuming, for such purposes, a
sufficient number of authorized shares of Common Stock available to convert all
such shares of Series A Preferred Stock) immediately prior to such
reclassification, change, consolidation, merger, combination, sale or conveyance
assuming such holder of Common Stock did not exercise the holder's rights of
election, if any, as to the kind or amount of securities, cash or other property
receivable upon such consolidation, merger, statutory exchange, sale or
conveyance (provided that, if the kind or amount of securities, cash or other
property receivable upon such consolidation, merger, statutory exchange, sale or
conveyance is not the same for each share of Common Stock in respect of which
such rights of election shall not have been exercised ("nonelecting share")),
then for the purposes of this Section 7(f), the kind and amount of securities,
cash or other property receivable upon such consolidation, merger, statutory
exchange, sale or conveyance for 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. Such amendment shall provide for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Section. The Company shall cause notice of the amendment of this Certificate of
Designation to be mailed to each holder of Series A Preferred Stock, at its
address appearing on the Share register, within twenty (20) days after execution
thereof. Failure to deliver such notice shall not affect the legality or
validity of such amendment. The above provisions of this Section shall similarly
apply to successive reclassifications, changes, consolidations, mergers,
combinations, sales and conveyances. If this Section 7(f) applies to any event
or occurrence, Section 7(e) shall not apply.

     (g) The issue of stock certificates on conversions of shares of Series A
Preferred Stock shall be made without charge to the converting holder for any
tax in respect of the issue thereof. The Company shall not, however, be required
to pay any tax which may be payable in respect of any transfer involved in the
issue and delivery of stock in any name other than that of the holder of any
share of Series A Preferred Stock converted, and the Company shall not be
required to issue or deliver any such stock certificate unless and until the
Person or Persons requesting the issue thereof shall have paid to the Company
the amount of such tax or shall have established to the satisfaction of the
Company that such tax has been paid.

     (h) The Company shall provide, free from preemptive rights, out of its
authorized but unissued shares or shares held in treasury, sufficient shares of
Common Stock to provide for the conversion of the shares of Series A Preferred
Stock from time to time as such are presented for conversion. Before taking any
action which would cause an adjustment reducing the Conversion Price below the
then par value, if any, of the shares of Common Stock issuable upon conversion
of the Series A Preferred Stock, the Company will take all corporate action
which may, in the opinion of its counsel, be necessary in order that the Company
may validly and legally issue shares of such Common Stock at such adjusted
Conversion Price. The Company covenants that all shares of Common Stock which
may be issued upon conversion of Series A Preferred Stock

                                       19
<PAGE>

will upon issue be fully paid and non-assessable by the Company and free
from all taxes, liens and charges with respect to the issue thereof.

     (i) In case:

          (1) the Company shall declare a dividend (or any other distribution)
     on its Common Stock that would require an adjustment in the Conversion
     Price pursuant to Section 7(e); or

          (2) the Company shall authorize the granting to the holders of all or
     substantially all of its Common Stock of rights or warrants to subscribe
     for or purchase any share of any class or any other rights or warrants; or

          (3) of any reclassification or reorganization of the Common Stock of
     the Company (other than a subdivision or combination of its outstanding
     Common Stock, or a change in par value, or from par value to no par value,
     or from no par value to par value), or of any consolidation or merger to
     which the Company is a party and for which approval of any stockholders of
     the Company is required, or of the sale or transfer of all or substantially
     all of the assets of the Company;

the Company shall cause to be mailed to each holder of Series A Preferred Stock
at the holder's address appearing on the Share register provided for in Section
2(e) of this Statement of Designation, as promptly as possible but in any event
at least fifteen (15) days prior to the applicable date hereinafter specified, a
notice stating (i) the date on which a record is to be taken for the purpose of
such dividend, distribution or 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 or rights are to be determined, or (ii) the date
on which such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up is expected to become effective or occur,
and the date as of which it is expected that holders of Common Stock of record
shall be entitled to exchange their Common Stock for securities or other
property deliverable upon such reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding up.  Failure to give such notice,
or any defect therein, shall not affect the legality or validity of such
dividend, distribution, reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up.

        8. CONSOLIDATION; MERGER; SALE OF ASSETS. Nothing contained in this
Certificate of Designation shall prevent any consolidation or merger of the
Company with or into any other corporation or corporations (whether or not
affiliated with the Company), or successive consolidations or mergers in which
the Company or its successor or successors shall be a party or parties, or shall
prevent any sale, conveyance or lease (or successive sales, conveyances or
leases) of all or substantially all of the property of the Company, to any other
corporation (whether or not affiliated with the Company), authorized to acquire
and operate the same and which shall be organized under the laws of the United
States of America, any state thereof or the District of Columbia; provided that
upon any such consolidation, merger, sale, conveyance or lease, the due and
punctual payment of the Liquidation Preference and any dividends on all of

                                       20
<PAGE>

the Series A Preferred Stock, according to their terms shall be expressly
assumed by the corporation (if other than the Company) formed by such
consolidation, or into which the Company shall have been merged, or by the
corporation which shall have acquired or leased such property, and such
amendment shall provide for the applicable conversion rights set forth in
Section 7(f).

     9. VOTING RIGHTS. Except as otherwise provided in this Statement
Designation or as required by law, the holders of record of shares of the Series
A Preferred Stock shall have no voting rights.

     10. AMENDMENT.

        (a) The Company shall not, without the affirmative vote or consent of
the holders of at least seventy-five percent (75%) of the outstanding
Liquidation Preference of Series A Preferred Stock then outstanding (with shares
held by the Company or any of its Affiliates not being considered to be
outstanding for this purpose) voting or consenting as the case may be, as one
class, amend or otherwise alter this Statement of Designation (including the
provisions of this Section 10) in any manner that adversely affects the
specified rights, preferences, privileges or voting rights of holders of Series
A Preferred Stock.

        (b) Without the consent of each holder affected, an amendment or waiver
of the Company's Articles of Incorporation or of this Statement of Designation
may not (with respect to any shares of Series A Preferred Stock held by a
non-consenting holder):

               (i) Reduce the number of shares of Series A Preferred Stock whose
          holders must consent to an amendment, supplement or waiver;

               (ii) Reduce or change the Liquidation Preference or the
          Conversion Price of any share of Series A Preferred Stock or alter the
          provisions with respect to the redemption of the Series A Preferred
          Stock;

               (iii) Reduce the rate of or change the time for payment of
          dividends on any share of Series A Preferred Stock;

               (iv) Make any share of Series A Preferred Stock payable in any
          form other than that stated in this Statement of Designation;

               (v) Make any change in the provisions of this Statement of
          Designation relating to waivers of the rights of holders of Series A
          Preferred Stock to receive the Liquidation Preference and dividends on
          the Series A Preferred Stock;

               (vi) Waive a redemption payment with respect to any share of
          Series A Preferred Stock (except as provided with respect to Section
          10 hereof); or

               (vii) Make any change in the foregoing amendment and waiver
          provisions.

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        (c) The Company in its sole discretion may without the vote or consent
of any holders of the Series A Preferred Stock amend or supplement this
Statement of Designation:

               (i) To cure any ambiguity, defect or inconsistency;

               (ii) To provide for uncertificated Series A Preferred Stock in
          addition to or in place of certificated Series A Preferred Stock;

               (iii) To make any change that would provide any additional rights
          or benefits to the holders of the Series A Preferred Stock or that
          does not adversely affect the legal rights under this Statement of
          Designation of any such holder; or

               (iv) To make any amendment required by Section 7(f) or 8.

          Except as set forth above, the creation, authorization or issuance of,
or the increase or decrease in the authorized amount of, capital stock of any
class, including any Series A Preferred Stock, shall not require the consent of
the holders of the Series A Preferred Stock and shall not be deemed to affect
adversely the rights, preferences, privileges, special rights or voting rights
of holders of shares of Series A Preferred Stock.

     11. EXCLUSION OF OTHER RIGHTS.

         Except as may otherwise be required by law, the shares of Series A
Preferred Stock shall not have any voting powers, preferences and relative,
participating, optional or other special rights, other than those specifically
set forth in this Statement of Designation (as amended from time to time) and in
the Articles of Incorporation. The shares of Series A Preferred Stock shall have
no preemptive or subscription rights.

     12. PROVISION FOR FINANCIAL INFORMATION.

         The Company will, within fifteen (15) days after filing with the
Commission the annual and quarterly reports that the Company is required to file
with the Commission pursuant to Section 13(a) or 15(d) of the Exchange Act,
transmit by mail to all holders, as their names and addresses appear in the
Share register, without cost to such holders copies of such annual and quarterly
reports.

     13. HEADINGS OF SUBDIVISIONS.

         The headings of the various subdivisions hereof are for convenience of
reference only and shall not affect the interpretation of any of the provisions
hereof.

     14. SEVERABILITY OF PROVISIONS.

         If any voting powers, preferences and relative, participating,
optional and other special rights of the Series A Preferred Stock and
qualifications, limitations and restrictions

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thereof set forth in this resolution (as such resolution may be amended from
time to time) is invalid, unlawful or incapable of being enforced by reason of
any rule of law or public policy, all other voting powers, preferences and
relative, participating, optional and other special rights of Series A Preferred
Stock and qualifications, limitations and restrictions thereof set forth in this
resolution (as so amended) which can be given effect without the invalid,
unlawful or unenforceable voting powers, preferences and relative,
participating, optional and other special rights of Series A Preferred Stock and
qualifications, limitations and restrictions thereof shall, nevertheless, remain
in full force and effect, and no voting powers, preferences and relative,
participating, optional or other special rights of Series A Preferred Stock and
qualifications, limitations and restrictions thereof herein set forth shall be
deemed dependent upon any other such voting powers, preferences and relative,
participating, optional or other special rights of Series A Preferred Stock and
qualifications, limitations and restrictions thereof unless so expressed herein.

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