Exhibit 4.1 - Restated Certificate of Incorporation, as amended


State of Delaware

Office of the Secretary of State 

Page 1

     I, EDWARD J. FREEL,
SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY CERTIFY THE ATTACHED ARE
TRUE AND CORRECT COPIES OF ALL DOCUMENTS FILED FROM AND INCLUDING THE RESTATED
CERTIFICATE OF "PERMA-FIX ENVIRONMENTAL SERVICES, INC." AS RECEIVED AND FILED IN
THIS OFFICE.
    THE FOLLOWING DOCUMENTS HAVE BEEN
CERTIFIED:

    RESTATED CERTIFICATE, FILED THE TWENTY-SIXTH
DAY OF NOVEMBER, A.D. 1991, AT 10 O'CLOCK A.M.

    CERTIFICATE OF AMENDMENT, CHANGING ITS NAME
FROM "NATIONAL ENVIRONMENTAL INDUSTRIES, LTD." TO "PERMA-FIX ENVIRONMENTAL
SERVICES, INC.", FILED THE SEVENTEENTH DAY OF DECEMBER, A.D. 1991, AT 4:30
O'CLOCK A.M.

    CERTIFICATE OF AMENDMENT, FILED THE FOURTH
DAY OF SEPTEMBER, A.D. 1992, AT 11:30 O'CLOCK A.M.

    CERTIFICATE OF DESIGNATION, FILED THE SIXTH
DAY OF FEBRUARY, A.D. 1996, AT 4 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED THE
TWENTIETH DAY OF FEBRUARY, A.D. 1996, AT 10:45 O'CLOCK A.M.

    CERTIFICATE OF DESIGNATION, FILED THE
NINETEENTH DAY OF JULY, A.D. 1996, AT 12:30 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED THE
SIXTEENTH DAY OF DECEMBER, A.D. 1996, AT 4:30 O'CLOCK P.M.

    CERTIFICATE OF AMENDMENT, FILED THE SIXTH DAY
OF JANUARY, A.D. 1997, AT 4:30 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED  THE
ELEVENTH DAY OF JUNE, A.D. 1997, AT 11 O'CLOCK A.M.

    CERTIFICATE OF DESIGNATION, FILED THE
FOURTEENTH DAY OF JULY, A.D. 1997, AT 11:15 O'CLOCK A.M.

    CERTIFICATE OF DESIGNATION, FILED THE
THIRTEENTH DAY OF NOVEMBER, A.D. 1997, AT 1:30 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION FILED THE
THIRTEENTH DAY OF NOVEMBER, A.D. 1997, AT 1:31 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED THE
TWENTH-SIXTH DAY OF NOVEMBER, A.D. 1997, AT 10 O'CLOCK A.M.

    CERTIFICATE OF DESIGNATION, FILED THE TENTH
DAY OF JULY, A.D. 1998, AT 12 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED THE
SIXTEENTH DAY OF JULY, A.D. 1998, AT 1:30 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED THE
SIXTEENTH DAY OF JULY, A.D. 1998, AT 1:31 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED THE
SIXTEENTH DAY OF JULY, A.D. 1998, AT 1:32 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED THE
FIFTEENTH DAY OF JULY, A.D. 1999, AT 12:30 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION,FILED THE
FIFTEENTH DAY OF JULY, A.D. 1999, AT 12:31 O'CLOCK P.M.

    CERTIFICATE OF DESIGANTION, FILED THE
FIFTEENTH DAY OF JULY, A.D. 1999, AT 12:32 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED THE
FIFTEENTH DAY OF JULY, A.D. 1999, AT 12:33 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED THE TENTH
DAY OF AUGUST, A.D. 1999, AT 12:30 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED THE TENTH DAY OF AUGUST,
A.D. 1999, AT 12:31 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED THE TENTH DAY OF AUGUST,
A.D. 1999, AT 12:32 O'CLOCK P.M.

    CERTIFICATE OF DESIGNATION, FILED THE TENTH DAY OF AUGUST,
A.D. 1999, AT 12:33 O'CLOCK P.M.

THE CERTIFICATE OF RESTATED CERTIFICATE OF "NATIONAL
ENVIRONMENTAL INDUSTRIES, LTD." FILED IN THIS OFFICE ON THE TWENTY- SIXTH DAY OF
NOVEMBER, A.D. 1991 AT 10 O'CLOCK
A.M.

                                                                                           /s/
Edward J.
Freel                                     
                                                                                    Edward
J. Freel, Secretary of State

 

2249849 
8100X                                                         AUTHENTICATION: 
0642864

001433866                                                                                          DATE:  08-28-00
 

 

RESTATED CERTIFICATE OF INCORPORATION

OF

NATIONAL ENVIRONMENTAL INDUSTRIES, LTD.


          1.  The
present name of the corporation (hereinafter called the
"Corporation") is National Environmental Industries, Ltd.,
and the date of filing the original certificate of incorporation of the Corporation with the Secretary of State of
the State of Delaware is December 19,
1990.

          2.  The
certificate of incorporation of the Corporation is hereby
amended by striking out Articles FOURTH through NINTH thereof and by substituting in lieu thereof new Articles FOURTH
through NINTH as set forth in the Restated Certificate of
Incorporation hereinafter provided
for.

          3.  The
provisions of the certificate of incorporation as heretofore
amended and/or supplemented, and as herein amended, are
hereby restated and integrated into the single instrument which is hereinafter set forth, and which is entitled Restated Certificate of Incorporation of National Environmental Industries,
Ltd. without any further amendment other than the amendment
certified herein and without any discrepancy between the

 

 

 

provisions of the certificate of
incorporation as heretofore amended and supplemented and the
provisions of the said single instrument hereinafter set
forth.

          4.  The
amendment and restatement of the certificate of incorporation herein certified have been duly adopted by the stockholders in accordance with the provisions of Sections 228,
242 and 245 of the General Corporation Law of the State of
Delaware.  Prompt written notice of the adoption of the
amendment and of the restatement of the certificate of
incorporation herein certified has been given to those
stockholders who have not consented in writing thereto, as
provided in Section 228 of the General Corporation Law of
the State of Delaware.

           5.  The
certificate of incorporation of the Corporation, as amended
and restated herein, shall at the effective time of this Restated Certificate of Incorporation, read as follows:

"Restated Certificate of
Incorporation
of
National Environmental Industries, Ltd.

                   FIRST:
The name of the Corporation is National Environmental
Industries, Ltd.

                   SECOND:
The address of the Corporation's registered office in the
State of Delaware is 32 Loockerman Square, Suite L-100, City of Dover, County of
Dover. The name of its registered agent at such address is
The Prentice-Hall Corporation System, Inc.

 

2

 

                     THIRD:
The purpose of the Corporation is to engage in any lawful
act or activity for which a corporation may be organized under the laws of the General Corproation Law of the State of
Delaware.

                     FOURTH:
The total number of shares of capital stock which the Corporation shall have
authority to issue is Twenty-Two Million (22,000,000) shares, of which Twenty
Million (20,000,000) shares shall be Common Stock, par value
$.001 per share, and Two Million (2,000,000) shares shall be
Preferred Stock, $.001 par value per share.

                      The
Preferred Stock may be issued from time to time in one or more series. The Board
of Directors is hereby expressly authorized to provide, by resolution or
resolutions duly adopted by it prior to issuance, for the creation of each such
series and to fix the designation and the powers, preferences, rights,
qualifications, limitations and restrictions relating to the shares of each such
series. The authority of the Board of Directors with respect to each such series
of Preferred Stock shall include, but not be limited to, determining the
following:

                       (a)
the designation of such series, the number of shares to constitute such series
and the stated value if different from the par value thereof; 

                      (b)
whether the shares of such series shall have voting rights, in addition to any
voting rights provided by law, and, if so, the terms of such voting rights,
which may be general or limited;

 

3

 

                     (c)
the dividends, if any, payable on such series, whether any such dividends shall
be cumulative, and, if so, from what dates, the conditions and dates upon which
such dividends shall be payable, and the preference or relation which such
dividends shall bear to the dividends payable on any shares of stock of any
other class or any other series of Preferred Stock;

                     (d)
whether the shares of such series shall be subject to redemption by the
Corporation, and, if so, the times, prices and other conditions of such
redemption; 

                     (e)
the amount or amounts payable upon shares of such series
upon, and the rights of the holders of such series in, the
voluntary or involuntary liquidation, dissolution or winding
up, or upon any distribution of the assets of the Corporation;

                     (f)
whether the shares of such series shall be subject to the operation of a
retirement or sinking fund and, if so, the extent to and manner in which any
such retirement or sinking fund shall be applied to the purchase or redemption
of the shares of such series for retirement or other corporate purposes and the
terms and provisions relating to the operation thereof;

 

4

 

                    (g)
whether the shares of such series shall be convertible into, or exchangeable
for, shares of stock of any other class or any other series of Preferred Stock
or any other securities and, if so, the price or prices or the rate or rates of
conversion or exchange and the method, if any, of adjusting the same, and any
other terms and conditions of conversion or exchange;

                    (h)
the limitations and restrictions, if any, to be effective while any shares of
such series are outstanding upon the payment of dividends or the making of other
distributions on, and upon the purchase, redemption or other acquisition by the
Corporation of, the Common Stock or shares of stock of any other class or any
other series of Preferred Stock;

                    (i)
the conditions or restrictions, if any, upon the creation of indebtedness of the
Corporation or upon the issue of any additional stock, including additional
shares of such series or of any other series of Preferred Stock or of any other
class; and

                   (j)
any other powers, preferences and relative participating, optional and other
special rights, and any qualifications, limitations and restrictions
thereof.

                    The
powers, preferences and relative, participating, optional and other special
rights of each series of Preferred Stock, and the qualifications, limitations or
restrictions thereof, 

 

5

 

if any, may differ from those of any and all other series at any
time outstanding. All shares of any one series of Preferred Stock shall be
identical in all respects with all other shares of such series, except that
shares of any one series issued at different times may differ as to the dates
from which dividends thereof shall be cumulative.

                      FIFTH:
Unless required by law or determined by the chairman of the meeting to be
advisable, the vote by stockholders on any matter, including the election of
directors, need not be by written ballot.

                      SIXTH:
The Corporation reserves the right to increase or decrease its authorized
capital stock, or any class or series thereof, and to reclassify the same, and
to amend, alter, change or repeal any provision contained in the Certificate of
Incorporation under which the Corporation is organized or in any amendment
thereto, in the manner now or hereafter prescribed by law, and all rights
conferred upon stockholders in said Certificate of Incorporation or any
amendment thereto are granted subject to the aforementioned
reservation.

                     SEVENTH:
The Board of Directors shall have the power at any time, and from time to time,
to adopt, amend and repeal any and all By-Laws of the Corporation.

                    EIGHTH:
All persons who the Corporation is empowered to indemnify pursuant to the
provisions of Section 145 of the General Corporation Law of the State of
Delaware (or any similar provision or provisions

 

6

 

of applicable law at the time in effect), shall be indemnified
by the Corporation to the full extent permitted thereby. The foregoing right of
indemnification shall not be deemed to be exclusive of any other rights to which
those seeking indemnification maybe entitled under any by-law, agreement, vote
of stockholders or disinterested directors, or otherwise. No repeal or amendment
of this Article EIGHTH shall adversely affect any rights of any person pursuant
to this Article Eighth which existed at the time of such repeal or amendment
with respect to acts or omissions occurring prior to such repeal or
amendment.

                    NINTH:
No director of the Corporation shall be personally liable to the Corporation or
its stockholders for any monetary damages for breaches of fiduciary duty as a
director, provided that this provisions shall not eliminate or limit the
liability of a director (i) for any breach of the director's duty of loyalty to
the Corporation or its stockholders; (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law;
(iii) under Section 174 of the General Corporation Law of the State of Delaware;
or (iv) for any transaction from which the director derived an improper personal
benefit. No repeal or amendment of this Article NINTH shall adversely affect any
rights of any person pursuant to this

 

7

 

Article NINTH which existed at the time of such repeal or
amendment with respect to acts or omissions occurring prior
to such repeal or amendment."

       IN WITNESS WHEREOF, we
have signed this Certificate this 22nd day of November,
1991.



                                                                                                     /s/
Louis
Centofanti                        
                                                                                                              President


ATTEST:


    /s/ Carol A.
Dixon             
Secretary

 

 

 

 

 

 

 

 

8

 

CERTIFICATE OF AMENDMENT
TO THE
RESTATED
CERTIFICATE OF INCORPORATION
OF
NATIONAL ENVIRONMENTAL INDUSTRIES,
LTD.


          It
is hereby certified that:

          1.  The
name of the corporation (hereinafter called the "Corporation") is National
Environmental Industries, Ltd.

          2.  The
Restated Certificate of Incorporation is hereby amended by striking out Article
FIRST thereof and by substituting in lieu of said Article
FIRST the following new Article:

               "FIRST:
The name of the Corporation is Perma-Fix Environmental Services,
Inc."

          3.  The
amendment of the Certificate of Incorporation herein certified has been duly
adopted in accordance with the provisions of Sections 228 and 242 of the General
Corporation Law of the State of Delaware. Prompt written notice of the adoption
of the amendment herein certified has been given to those stockholders who have
not consented in writing thereto, as provided in Section 228 of the General
Corporation Law of the State of Delaware.

           IN
WITNESS WHEREOF, we have signed this Certificate this 16th day of December,
1991.


                                                                                                /s/
Louis
Centofanti                           
                                                                                            Louis
Centofanti, President

ATTEST:


/s/
Mark
Zwecker                             
Mark
Zwecker, Secretary






 

CERTIFICATE OF AMENDMENT
TO
RESTATED
CERTIFICATE OF INCORPORATION, AS AMENDED
OF
PERMA-FIX ENVIRONMENTAL
SERVICES, INC.

 

          Perma-Fix
Environmental Services, Inc., a Delaware corporation (the
"Corporation"), does hereby certify:

          That the
amendment set forth below to the Corporation's Restated Certificate of
Incorporation, as amended, was duly adopted in accordance with the provisions of
Section 242 of the General Corporation Law of the State of Delaware and written
notice thereof has been given as provided in Section 228 thereof:

          I)
The first paragraph of Article FOURTH of the Corporation's
Restated Certificate of Incorporation, as amended, is hereby
deleted and replaced in its entirety by the following:

                           Fourth:
The total number of shares of capital stock that the
Corporation shall
have 
                           authority
to issue is 22,000,000 shares of which 20,000,000
shares of the par
value 
                           of
$.001 per share shall be designated Common Stock ("Common
Stock"), and 
                           2,000,000
shares of the par value of $.001 per share shall be
designated
Preferred 
                           Stock.

                          As
of September 4, 1992 (the "Effective Time"), each share of Common Stock
issued 
                          and
outstanding immediately prior to the Effective Time shall automatically be
changed 
                          and
converted, without any action on the part of the holder thereof, into
1/3.0236956 
                          of
a share of Common Stock and, in connection with fractional interests in shares
of 
                          Common
Stock of the Corporation, each holder whose aggregate holdings of
shares 
                          of
Common stock prior to the Effective Time amounted to less than 3.0236956,
or 
                          to
a number not evenly divisible by 3.0236956 shares of Common Stock shall
be 

 

 

 

                          entitled
to receive for such fractional interest, and at such time, any such
fractional 
                          interest
in shares of Common Stock of the Corporation shall be converted into
the 
                          right
to receive, upon surrender of the stock certificates formerly
representing 
                          shares
of Common Stock of the Corporation, one whole share of Common Stock.

          IN
WITNESS whereof, Perma-Fix Environmental Services, Inc. has
caused this Certificate to be signed and attested to by its
duly authorized officers as of this first day of September, 1992.

                                                                    Perma-Fix
Environmental Services, Inc.



                                                                    By: /s/ Louis
Centofanti                             
                                                                          Dr. Louis F.
Centofanti
                                                                          President

ATTEST:



By: /s/ Mark
Zwecker                         
      Secretary


981311720
 
 

 

CERTIFICATE OF DESIGNATIONS
OF SERIES I CLASS A
PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.


     Perma-Fix Environmental Services,
Inc. (the "Corporation"), a corporation organized and existing under the General
Corporation Law of the State of Delaware, does hereby certify:

     That, pursuant to authority
conferred upon by the Board of Directors by the
Corporation's Certificate of Incorporation, as amended, and
pursuant to the provisions of Section 151 of the Delaware
Corporation Law, said Board of Directors, acting by unanimous written consent in lieu of a meeting dated February 2,
1996, hereby adopted the terms of the Series I Class A
Preferred Stock, which resolutions are set forth on the
attached page.

Dated: February 2, 1996

                                                          PERMA-FIX
ENVIRONMENTAL SERVICES, INC.



                                                           By /s/ Louis F.
Centofanti                                                
                                                                Dr.
Louis F.
Centofanti
                                                                Chairman of the Board


ATTEST:

/s/ Mark A.
Zwecker                   
Mark A. Zwecker, Secretary
 
 

 

 

PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the
"Corporation")

RESOLUTION OF THE BOARD OF DIRECTORS

FIXING THE
NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS
ATTACHING TO THE SERIES I CLASS A
PREFERRED STOCK


WHEREAS,

A.  The Corporation's share capital includes Preferred
Stock, par value $.001 per share ("Preferred
Stock"),
      which Preferred Stock may be issued in one or more series with the directors of the Corporation (the
      "Board") being
entitled by resolution to fix the number of shares in each
series and to designate the 
      rights, designations,
preferences, and relative, participating, optional or other
special rights, privileges,
      restrictions and conditions attaching to the shares of each such series; and

B.  It is in the best interests of the
Corporation for the Board to create a new series from the
Preferred 
      Stock designated
as the Series I Class A Preferred Stock, par value
$.001. 

NOW, THEREFORE, BE IT RESOLVED,
THAT:

      The Series I Class A
Preferred Stock, par value $.001 (the "Series I Class A
Preferred Stock") of the
      Corporation
shall consist of 1,100 shares and no more and shall be
designated as the Series I Class
A
      Preferred Stock and in addition to
the preferences, rights, privileges, restrictions and
conditions 
      attaching to all the Series I
Class A Preferred Stock as a series, the rights, privileges,
restrictions 
      and conditions
attaching to the Series I Class A Preferred Stock shall be
as follows:

Part 1 - Voting and Preemptive Rights.

1.1  Except as otherwise provided herein, in the
Certificate of Incorporation (the "Articles") or the General Corporation Law of
the State of Delaware (the "GCL"), each holder of Series I Class A Preferred
Stock, by virtue of his ownership thereof, shall be entitled to cast that number
of votes per share thereof on each matter submitted to the Corporation's
shareholders for voting which equals the number of votes which could be cast by
such holder of the number of shares of the Corporation's Common Stock, par value
$.001 per share (the "Common Shares") into which such shares of Series I Class A
Preferred Stock would be converted into pursuant to Part 5 hereof immediately
prior to the record date of such vote. The outstanding Series I Class A
Preferred Stock and the Common Shares of the Corporation shall vote together as
a single class, except as otherwise expressly required by the GCL or Part 7
hereof. The Series I Class A Preferred Stock shall not have cumulative voting
rights.

 

 

1.2  The Series I Class A Preferred Stock shall not
give its holders any preemptive rights to acquire any other securities issued by
the Corporation at any time in the future.

Part 2 - Liquidation Rights.

2.1  If the Corporation shall be voluntarily or
involuntarily liquidated, dissolved or wound up at any time when any Series I
Class A Preferred Stock shall be outstanding, the holders of the then
outstanding Series I Class A Preferred Stock shall have a preference in
distribution of the Corporation's property available for distribution to the
holders of the Common Shares equal to $1,000 consideration per outstanding share
of Series I Class A Preferred Stock, together with an amount equal to all unpaid
dividends accrued thereon, if any, to the date of payment of such distribution,
whether or not declared by the Board; provided, however, that the
merger of the Corporation with any corporation or corporations in which the
Corporation is not the survivor, or the sale or transfer by the Corporation of
all or substantially all of its property, or any reduction by at least seventy
percent (70%) of the then issued and outstanding Common Shares of the
Corporation, shall be deemed to be a liquidation of the Corporation within the
meaning of any of the provisions of this Part 2.

2.2  Subject to the provisions of Part 6 hereof, all
amounts to be paid as preferential distributions to the holders of Series I
Class A Preferred Stock, as provided in this Part 2, shall be paid or set apart
for payment before the payment or setting apart for payment of any amount for,
or the distribution of any of the Corporation's property to the holders of
Common Shares, whether now or hereafter authorized, in connection with such
liquidation, dissolution or winding up.

Part 3 - Dividends.

3.1  Holders of record of Series I Class A Preferred
Stock, out of funds legally available therefor and to the extent permitted by
law, shall be entitled to receive dividends on their Series I Class A Preferred
Stock, which dividends shall accrue at the rate per share of five percent (5%)
per annum of consideration paid for each share of Series I Class A Preferred
Stock ($50.00 per share per year for each full year) commencing on the date of
the issuance thereof, payable, at the option of the Corporation, (i) in cash, or
(ii) by the issuance of that number of whole Common Shares computed by dividing
the amount of the dividend by the market price applicable to such
dividend.

3.2  For the purposes of this Part 3 and Part 4
hereof, "market price" means the average of the daily closing prices of Common
Shares for a period of five (5) consecutive trading days ending on the date on
which any dividend becomes payable or of any notice of redemption as the case
may be. The closing price for each trading day shall be (i) for any period
during which the Common Shares shall be listed for trading on a national
securities exchange, the last reported bid price per share of Common Shares as
reported by the primary stock exchange, or the Nasdaq Stock Market, if the
Common Shares are quoted on the Nasdaq Stock Market, or (ii) if last sales price
information is not available, the average closing bid price of Common Shares as
reported

 

-2-

 

by the Nasdaq Stock Market, or if not so listed or reported,
then as reported by National Quotation Bureau, Incorporated, or (iii) in the
event neither clause (i) nor (ii) is applicable, the average of the closing bid
and asked prices as furnished by any member of the National Association of
Securities Dealers, Inc., selected from time to time by the Corporation for that
purpose.

3.3  Dividends on Series I Class A Preferred Stock
shall be cumulative, and no dividends or other distributions
shall be paid or declared and set aside for payment on the
Common Shares until full cumulative dividends on all
outstanding Series I Class A Preferred Stock shall have been paid or declared
and set aside for payment.

3.4  Dividends shall be payable in arrears, at the
rate of $12.50 per share for each full calendar quarter on each February 28, May
31, August 31, and November 30 of each calendar year, to the holders of record
of the Series I Class A Preferred Stock as they appear in the securities
register of the Corporation on such record dates not more than sixty (60) nor
less than ten (10) days preceding the payment date thereof, as shall be fixed by
the Board; provided, however, that the initial dividend for the Series I Class A
Preferred Stock shall accrue for the period commencing on the date of the
issuance thereof to and including December 31, 1995.

3.5  If, in any quarter, insufficient funds are
available to pay such dividends as are then due and payable with respect to the
Series I Class A Preferred Stock and all other classes and series of the capital
stock of the Corporation ranking in parity therewith (or such payment is
otherwise prohibited by provisions of the GCL, such funds as are legally
available to pay such dividends shall be paid or Common Shares will be issued as
stock dividends to the holders of Series I Class A Preferred Stock and to the
holders of any other series of Class A Preferred Stock then outstanding as
provided in Part 6 hereof, in accordance with the rights of each such holder,
and the balance of accrued but undeclared and/or unpaid dividends, if any, shall
be declared and paid on the next succeeding dividend date to the extent that
funds are then legally available for such purpose.

Part 4 - Redemption.

4.1  At any time, and from time to time, on and after
one hundred twenty (120) days from the date of the issuance of any Series I
Class A Preferred Stock, if the average of the closing bid prices for the Common
Shares for five (5) consecutive trading days shall be in excess of $1.50, the
Corporation may, at its sole option, but shall not be obligated to, redeem, in
whole or in part, the then outstanding Series I Class A Preferred Stock at a
price per share of U. S. $1,000 each (the "Redemption Price") (such price to be
adjusted proportionately in the event of any change of the Series I Class A
Shares into a different number of Shares).

4.2  Thirty (30) days prior to any date stipulated by
the Corporation for the redemption of Series I Class A Preferred Stock (the
"Redemption Date"), written notice (the "Redemption Notice") shall be mailed to
each holder of record on such notice date of the Series I Class A Preferred
Stock. The Redemption Notice shall

 

-3-

 

state: (i) the Redemption Date of such Shares, (ii) the number
of Series I Class A Preferred Stock to be redeemed from the holder to whom the
Redemption Notice is addressed, (iii) instructions for surrender to the
Corporation, in the manner and at the place designated of a share certificate or
share certificates representing the number of Series I Class A Preferred Stock
to be redeemed from such holder, and (iv) instructions as to how to specify to
the Corporation the number of Series I Class A Preferred Stock to be redeemed as
provided in this Part 4, and the number of shares to be converted into Common
Shares as provided in Part 5 hereof.

4.3  Upon receipt of the Redemption Notice, any
Eligible Holder (as defined in Section 5.2 hereof) shall have the option, at its
sole election, to specify what portion of its Series I Class A Preferred Stock
called for redemption in the Redemption Notice shall be redeemed as provided in
this Part 4 or converted into Common Shares in the manner provided in Part 5
hereof, except that, notwithstanding any provision of such Part 5 to the
contrary, any Eligible Holder shall have the right to convert into Common Shares
that number of Series I Class A Preferred Stock called for redemption in the
Redemption Notice.

4.4  On or before the Redemption Date in respect of
any Series I Class A Preferred Stock, each holder of such shares shall surrender
the required certificate or certificates representing such shares to the
Corporation in the manner and at the place designated in the Redemption Notice,
and upon the Redemption Date, the Redemption Price for such shares shall be made
payable, in the manner provided in Section 5.5 hereof, to the order of the
person whose name appears on such certificate or certificates as the owner
thereof, and each surrendered share certificate shall be canceled and retired.
If a share certificate is surrendered and all the shares evidenced thereby are
not being redeemed (as described below), the Corporation shall cause the Series
I Class A Shares which are not being redeemed to be registered in the names of
the persons whose names appear as the owners on the respective surrendered share
certificates and deliver such certificate to such person.

4.5  On the Redemption Date in respect of any Series I
Class A Shares or prior thereto, the Corporation shall deposit with any bank or
trust company having a capital and surplus of at least U. S. $50,000,000, as a
trust fund, a sum equal to the aggregate Redemption Price of all such shares
called from redemption (less the aggregate Redemption Price for those Series I
Class A Shares in respect of which the Corporation has received notice from the
Eligible Holder thereof of its election to convert Series I Class A Shares in to
Common Shares), with irrevocable instructions and authority to the bank or trust
company to pay, on or after the Redemption Date, the Redemption Price to the
respective holders upon the surrender of their share certificates. The deposit
shall constitute full payment for the shares to their holders, and from and
after the date of the deposit the redeemed share shall be deemed to be no longer
outstanding, and holders thereof shall cease to be shareholders with respect to
such shares and shall have no rights with respect thereto except the rights to
receive from the bank or trust company payments of the Redemption price of the
shares, without interest, upon surrender of their certificates thereof. Any
funds so deposited and unclaimed at the end of one year following the Redemption
Date shall be released or repaid to the Corporation, after which the former
holders of shares

 

-4-

 

called for redemption shall be entitled to receive payment of
the Redemption Price in respect of their shares only from the
Corporation.

Part 5 - Conversion.

5.1  For the purposes of conversion of the Series I
Class A Preferred Stock shall be valued at $1,000 per share
("Value"), and, if converted, the Series I Class A Preferred
Stock shall be converted into such number of Common Shares
(the "Conversion Shares") as is obtained by dividing the
aggregate Value of the shares of Series I Class A Preferred
Stock being so converted, together with all accrued but
unpaid dividends thereon, by the "Average Stock Price" per share of the
Conversion Shares (the "Conversion Price"), subject to adjustment pursuant to
the provisions of this Part 5. For purposes of this Part 5, the "Average Stock
Price" means the lesser of (x) seventy percent (70%) of the average daily
closing bid prices of the Common Shares for the period of five (5) consecutive
trading days immediately preceding the date of subscription by the Holder or (y)
seventy percent (70%) of the daily average closing bid prices of Common Shares
for the period of five (5) consecutive trading days immediately preceding the
date of the conversion of the Series I Class A Preferred Stock in respect of
which such Average Stock Price is determined. The closing price for each trading
day shall be determined as provided in the last sentence of Section
3.2. 

5.2  Any holder of Series I Class A Preferred Stock
(an "Eligible Holder") may at any time commencing forty-five (45) days after the
issuance of any Series I Class A Preferred Stock convert up to one hundred
percent (100%) of his holdings of Series I Class A Preferred Stock in accordance
with this Part 5.

5.3  The conversion right granted by Section 5.2
hereof may be exercised only by an Eligible Holder of Series I Class A Preferred
Stock, in whole or in part, by the surrender of the share certificate or share
certificates representing the Series I Class A Preferred Stock to be converted
at the principal office of the Corporation (or at such other place as the
Corporation may designate in a written notice sent to the holder by first class
mail, postage prepaid, at its address shown on the books of the Corporation)
against delivery of that number of whole Common Shares as shall be computed by
dividing (1) the aggregate Value of the Series I Class A Preferred Stock so
surrendered for conversion plus any accrued but unpaid dividends thereon, if
any, by (2) the Conversion Price in effect at the date of the conversion. At the
time of conversion of a share of the Series I Class A Preferred Stock, the
Corporation shall pay in cash to the holder thereof an amount equal to all
unpaid dividends, if any, accrued thereon to the date of conversion, or, at the
Corporation's option, issue that number of whole Common Shares which is equal to
the product of dividing the amount of such unpaid dividends by the Average Stock
Price whether or not declared by the Board. Each Series I Class A Preferred
Stock share certificate surrendered for conversion shall be endorsed by its
holder. In the event of any exercise of the conversion right of the Series I
Class A Preferred Stock granted herein (i) share certificate representing the
Common Shares purchased by virtue of such exercise shall be delivered to such
holder within three (3) days of notice of conversion, and (ii) unless the Series
I Class A Preferred Stock has been fully converted, a new share certificate
representing the Series I Class A Preferred Stock not so converted, if any,
shall also be delivered to

 

-5-

 

such holder within three (3) days of notice of conversion. Any
Eligible Holder may exercise its right to convert the Series I Class A Preferred
Stock by telecopying an executed and completed Notice of Conversion to the
Corporation, and within seventy-two (72) hours thereafter, delivering the
original Notice of Conversion and the certificate representing the Series I
Class A Preferred Stock to the Corporation by express courier. Each date on
which a Notice of Conversion is telecopied to and received by the Corporation in
accordance with the provisions hereof shall be deemed a conversion date. The
Corporation will transmit the Common Shares certificates issuable upon
conversion of any Series I Class A Preferred Stock (together with the
certificates representing the Series I Class A Preferred Stock not so converted)
to the Eligible Holder via express courier within three (3) business days after
the conversion date if the Corporation has received the original Notice of
Conversion and the Series I Class A Shares certificates being so converted by
such date.

5.4  All Common Shares which may be issued upon
conversion of Series I Class A Preferred Stock will, upon issuance, be duly
issued, fully paid and nonassessable and free from all taxes, liens, and charges
with respect to the issue thereof. At all times that any Series I Class A
Preferred Stock is outstanding, the Corporation shall have authorized, and shall
have reserved for the purpose of issuance upon such conversion, a sufficient
number of Common Shares to provide for the conversion into Common Shares of all
Series I Class A Preferred Stock then outstanding at the then effective
Conversion Price. Without limiting the generality of the foregoing, if, at any
time, the Conversion Price is decreased, the number of Common Shares authorized
and reserved for issuance upon the conversion of the Series I Class A Preferred
Stock shall be proportionately increased. 

5.5  The number of Common Shares issued upon
conversion of Series I Class A Preferred Stock and the Conversion Price shall be
subject to adjustment from time to time upon the happening of certain events, as
follows:

     5.5.1  Change of
Designation of the Common Shares or the rights, privileges, restrictions and
conditions
      in respect of the Common Shares or
division of the Common Shares into series. In the case of
any
      amendment to the Articles to change the
designation of the Common Shares or the rights,
privileges,
      restrictions or conditions in
respect of the Common Shares or division of the Common Shares into
series
      the rights of the holders of the Series
I Class A Preferred Stock shall be adjusted so as to provide
that
      upon conversion thereof, the holder of
the Series I Class A Preferred Stock being converted shall
procure,
      in lieu of each Common Share
theretofore issuable upon such conversion, the kind and amount of
shares,
      other securities, money and property
receivable upon such designation, change or division by the holder
of
      one Common Share issuable upon such
conversion had conversion occurred immediately prior to
such
      designation, change or division. The
Series I Class A Preferred Stock shall be deemed thereafter
to
      provide for adjustments which shall be as
nearly equivalent as may be practicable to the adjustments

 

-6-

 


      provided for in this Part 5.
The provisions of this subsection 5.5.1 shall apply in the same manner
to
      successive reclassifications, changes,
consolidations, and mergers.

      5.5.2  If the
Corporation, at any time while any of the Series I Class A Preferred Stock is
outstanding, 
      shall amend the
Articles so as to change the Common Shares into a different number of shares,
the
      Conversion Price shall be proportionately
reduced, in case of such change increasing the
number 
      of Common Shares, as of the
effective date of such increase, or if the Corporation shall take a
record
      of holders of its Common Shares for the
purpose of such increase, as of such record date,
whichever 
      is earlier, or the
Conversion Price shall be proportionately increased, in the case of such
change 
      decreasing the number of
Common Shares, as of the effective date of such decrease or, if
the 
      Corporation shall take a record
of holders of its Common Stock for the purpose of such
decrease, 
      as of such record date,
whichever is earlier.

      5.5.3 If the Corporation, at
any time while any of the Series I Class A Preferred Stock is
outstanding, 
      shall pay a dividend
payable in Common Shares (except for any dividends of Common
Shares 
      payable pursuant to Part 3
hereof), the Conversion Price shall be adjusted, as of the date
the 
      Corporation shall take a record
of the holders of its Common Shares for the purposes of
receiving 
      such dividend (or if no
such record is taken, as of the date of payment of such dividend), to
that 
      price determined by
multiplying the Conversion Price therefor in effect by a fraction (1) the
numerator 
      of which shall be the
total number of Common Shares outstanding immediately prior to such
dividend, 
      and (2) the denominator
of which shall be the total number of Common Shares
outstanding 
      immediately after such
dividend (plus in the event that the Corporation paid cash for fractional
shares, 
      the number of additional
shares which would have been outstanding had the Corporation
issued 
      fractional shares in
connection with said dividend). 

5.6  Whenever the Conversion Price shall be adjusted
pursuant to Section 5.5 hereof, the Corporation shall make a certificate signed
by its President, or a Vice President and by its Treasurer, Assistant Treasurer,
Secretary or Assistant Secretary, setting forth, in reasonable detail, the event
requiring the adjustment, the amount of the adjustment, the method by which such
adjustment was calculated (including a description of the basis on which the
Board of Directors made any determination hereunder), and the Conversion Price
after giving effect to such adjustment, and shall cause copies of such
certificates to be mailed (by first class mail, postage prepaid) to each holder
of the Series I Class A Preferred Stock at its address shown
on the books of the Corporation. The Corporation shall make
such certificate and mail it to each such holder promptly
after each adjustment.

5.7  No fractional Common Shares shall be issued in
connection with any conversion of Series I Class A Preferred Stock, but in lieu
of such fractional shares, the Corporation shall make a cash payment therefor
equal in amount to the product of the applicable fraction multiplied by the
Conversion Price then in effect.

 

-7-

 

5.8  No Series I Class A Preferred Stock which has
been converted into Common Shares shall be reissued by the Corporation;
provided, however, that each such share shall be restored to the status of
authorized but unissued Preferred Stock without designation as to series and may
thereafter be issued as a series of Preferred Stock not designated as Series I
Class A Preferred Stock.

Part 6 - Parity with Other Shares of Class A Preferred
Shares.

6.1  If any cumulative dividends or accounts payable
or return of capital in respect of Series I Class A Preferred Stock are not paid
in full, the owners of all series of outstanding Preferred Stock shall
participate rateably in respect of accumulated dividends and return of
capital.

Part 7 - Amendment.

7.1  In addition to any requirement for a series vote
pursuant to the GCL in respect of any amendment to the Corporation's Certificate
of Incorporation that adversely affects the rights, privileges, restrictions and
conditions of the Series I Class A Preferred Stock, the rights, privileges,
restrictions and conditions attaching to the Series I Class A Preferred Stock
may be amended by an amendment to the Corporation's Certificate of Incorporation
so as to affect such adversely only if the Corporation has obtained the
affirmative vote at a duly called and held series meeting of the holders of the
Series I Class A Preferred Stock or written consent by the holders of a majority
of the Series I Class A Preferred Stock then outstanding. Notwithstanding the
above, the number of authorized shares of such class or classes of stock may be
increased or decreased (but not below the number of shares thereof outstanding)
by the affirmative vote of the holders of a majority of the stock of the
Corporation entitled to vote thereon, voting as a single class, irrespective of
this Section 7.1.
 
 

 

 

 

 

-8-

 

CERTIFICATE OF DESIGNATIONS
OF SERIES 2 CLASS B
CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES,
INC.


      Perma-Fix Environmental
Services, Inc. (the "Corporation"), a corporation organized
and existing under the General Corporation Law of the State
of Delaware, does hereby certify:

     That, pursuant to authority
conferred upon by the Board of Directors by the Corporation's Restated
Certificate of Incorporation, as amended, and pursuant to the provisions of
Section 151 of the Delaware Corporation Law, the Board of Directors of the
Corporation has adopted resolutions, a copy of which is attached hereto,
establishing and providing for the issuance of a series of Preferred Stock
designated as Series 2 Class B Convertible Preferred Stock and has established
and fixed the voting powers, designations, preferences and relative
participating, optional and other special rights and qualifications, limitations
and restrictions of such Series 2 Class B Convertible Preferred Stock as set
forth in the attached resolutions.

Dated: February 16, 1996

                                                         PERMA-FIX
ENVIRONMENTAL SERVICES, INC.



                                                          By /s/ Louis F.
Centofanti                                                 
                                                              Dr. Louis F.
Centofanti
                                                              Chairman of the Board


ATTEST:




/s/ Mark A.
Zwecker                    
Mark
A. Zwecker, Secretary



 

 

 

 

PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the
"Corporation")

RESOLUTION OF THE BOARD OF DIRECTORS

FIXING THE
NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS
ATTACHING TO THE
SERIES 2 CLASS B CONVERTIBLE PREFERRED
STOCK


WHEREAS,

A.  The Corporation's share capital includes Preferred
Stock, par value $.001 per share ("Preferred
Stock"),
      which Preferred Stock may be issued
in one or more series with the directors of the Corporation
(the
      "Board") being entitled by resolution to
fix the number of shares in each series and to designate
the 
      rights, designations,
preferences, and relative, participating, optional or other special rights,
privileges,
      restrictions and conditions
attaching to the shares of each such series; and

B.  It is in the best interests of the Corporation for
the Board to create a new series from the
Preferred 
      Stock designated as the
Series 2 Class B Convertible Preferred Stock, par value $.001.

NOW, THEREFORE, BE IT RESOLVED, THAT:

     The Series 2 Class B Convertible
Preferred Stock, par value $.001 (the "Series 2 Class B
Preferred
     Stock") of the Corporation shall
consist of 2,500 shares and no more and shall be designated as
the 
     Series 2 Class B Preferred Stock and
in addition to the preferences, rights, privileges,
restrictions 
     and conditions attaching to
all the Series 2 Class B Preferred Stock as a series, the
rights, 
     privileges, restrictions and
conditions attaching to the Series 2 Class B Preferred Stock shall
be 
     as follows:

Part 1 - Voting and Preemptive Rights.

1.1  Except as otherwise provided herein, in the
Corporation's Certificate of Incorporation (the "Articles") or the General
Corporation Law of the State of Delaware (the "GCL"), each holder of Series 2
Class B Preferred Stock, by virtue of his ownership thereof, shall be entitled
to cast that number of votes per share thereof on each matter submitted to the
Corporation's shareholders for voting which equals the number of votes which
could be cast by such holder of the number of shares of the Corporation's Common
Stock, par value $.001 per share (the "Common Shares") into which such shares of
Series 2 Class B Preferred Stock would be entitled to be converted into pursuant
to Part 5 hereof on the record date of such vote. The outstanding Series 2 Class
B Preferred Stock, the Common Shares of the Corporation and any other series of
Preferred Stock of the Corporation having voting rights shall vote together as a
single class, except as otherwise expressly required by the GCL or Part 7
hereof. The Series 2 Class B Preferred Stock shall not have cumulative voting
rights.

 

 

1.2  The Series 2 Class B Preferred Stock shall not
give its holders any preemptive rights to acquire any other securities issued by
the Corporation at any time in the future.

Part 2 - Liquidation Rights.

2.1  If the Corporation shall be voluntarily or
involuntarily liquidated, dissolved or wound up at any time when any Series 2
Class B Preferred Stock shall be outstanding, the holders of the then
outstanding Series 2 Class B Preferred Stock shall have a preference in
distribution of the Corporation's property available for distribution to the
holders of the Common Shares equal to $1,000 consideration per outstanding share
of Series 2 Class B Preferred Stock, together with an amount equal to all unpaid
dividends accrued thereon, if any, to the date of payment of such distribution,
whether or not declared by the Board; provided, however, that the merger of the
Corporation with any corporation or corporations in which the Corporation is not
the survivor, or the sale or transfer by the Corporation of all or substantially
all of its property, or a reduction by at least seventy percent (70%) of the
then issued and outstanding Common Shares of the Corporation, shall be deemed to
be a liquidation of the Corporation within the meaning of any of the provisions
of this Part 2.

2.2  Subject to the provisions of Part 6 hereof, all
amounts to be paid as preferential distributions to the holders of Series 2
Class B Preferred Stock, as provided in this Part 2, shall be paid or set apart
for payment before the payment or setting apart for payment of any amount for,
or the distribution of any of the Corporation's property to the holders of
Common Shares, whether now or hereafter authorized, in connection with such
liquidation, dissolution or winding up.

2.3  After the payment to the holders of the shares of
the Series 2 Class B Preferred Stock of the full preferential amounts provided
for in this Part 2, the holders of the Series 2 Class B Preferred Stock as such
shall have no right or claim to any of the remaining assets of the
Corporation.

2.4  In the event that the assets of the Corporation
available for distribution to the holders of shares of the Series 2 Class B
Preferred Stock upon any dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, shall be insufficient to pay in
full all amounts to which such holders are entitled pursuant to this Part 2, no
such distribution shall be made on account of any shares of any other class or
series of Preferred Stock ranking on a parity with the shares of this Series 2
Class B Preferred Stock upon such dissolution, liquidation or winding up unless
proportionate distributive amounts shall be paid on account of the shares of
this Series 2 Class B Preferred Stock and shares of such other class or series
ranking on a parity with the shares of this Series 2 Class B Preferred Stock,
ratably, in proportion to the full distributable amounts for which holders of
all such parity shares are respectively entitled upon such dissolution,
liquidation or winding up.

 

-2-

 

Part 3 - Dividends.

3.1  Holders of record of Series 2 Class B Preferred
Stock, out of funds legally available therefor and to the extent permitted by
law, shall be entitled to receive dividends on their Series 2 Class B Preferred
Stock, which dividends shall accrue at the rate per share of five percent (5%)
per annum of consideration paid for each share of Series 2 Class B Preferred
Stock ($50.00 per share per year for each full year) commencing on the date of
the issuance thereof, payable, at the option of the Corporation, (i) in cash, or
(ii) by the issuance of that number of whole Common Shares computed by dividing
the amount of the dividend by the market price applicable to such
dividend.

3.2  For the purposes of this Part 3 and Part 4
hereof, "market price" means the average of the daily closing prices of Common
Shares for a period of five (5) consecutive trading days ending on the date on
which any dividend becomes payable or of any notice of redemption as the case
may be. The closing price for each trading day shall be (i) for any period
during which the Common Shares shall be listed for trading on a national
securities exchange, the last reported bid price per share of Common Shares as
reported by the primary stock exchange, or the Nasdaq Stock Market, if the
Common Shares are quoted on the Nasdaq Stock Market, or (ii) if last sales price
information is not available, the average closing bid price of Common Shares as
reported by the Nasdaq Stock Market, or if not so listed or reported, then as
reported by National Quotation Bureau, Incorporated, or (iii) in the event
neither clause (i) nor (ii) is applicable, the average of the closing bid and
asked prices as furnished by any member of the National Association of
Securities Dealers, Inc., selected from time to time by the Corporation for that
purpose.

3.3  Dividends on Series 2 Class B Preferred Stock
shall be cumulative, and no dividends or other distributions
shall be paid or declared and set aside for payment on the
Common Shares until full cumulative dividends on all
outstanding Series 2 Class B Preferred Stock shall have been
paid or declared and set aside for payment.

3.4  Dividends shall be payable in arrears, at the
rate of $12.50 per share for each full calendar quarter on
each February 28, May 31, August 31, and November 30 of each
calendar year, to the holders of record of the Series 2
Class B Preferred Stock as they appear in the securities
register of the Corporation on such record dates not more
than sixty (60) nor less than ten (10) days preceding the
payment date thereof, as shall be fixed by the Board; provided, however, that the initial dividend for the Series 2
Class B Preferred Stock shall accrue for the period
commencing on the date of the issuance thereof.

3.5  If, in any quarter, insufficient funds are
available to pay such dividends as are then due and payable with respect to the
Series 2 Class B Preferred Stock and all other classes and series of the capital
stock of the Corporation ranking in parity therewith (or such payment is
otherwise prohibited by provisions of the GCL, such funds as are legally
available to pay such dividends shall be paid or Common Shares will be issued as
stock dividends to the holders of Series 2 Class B Preferred Stock and to the
holders of any other series of

 

-3-

 

Class B Preferred Stock then outstanding as provided in Part 6
hereof, in accordance with the rights of each such holder, and the balance of
accrued but undeclared and/or unpaid dividends, if any, shall be declared and
paid on the next succeeding dividend date to the extent that funds are then
legally available for such purpose.

Part 4 - Redemption.

4.1  At any time, and from time to time, on and after
one hundred twenty (120) days from the date of the issuance of any Series 2
Class B Preferred Stock, if the average of the closing bid prices for the Common
Shares for five (5) consecutive trading days shall be in excess of $1.50 per
share, the Corporation may, at its sole option, but shall not be obligated to,
redeem, in whole or in part, the then outstanding Series 2 Class B Preferred
Stock at a price per share of U. S. $1,000 each (the "Redemption Price") (such
price to be adjusted proportionately in the event of any change of the Series 2
Class B Preferred Stock into a different number of shares of Series 2 Class B
Preferred Stock).

4.2  Thirty (30) days prior to any date stipulated by
the Corporation for the redemption of Series 2 Class B Preferred Stock (the
"Redemption Date"), written notice (the "Redemption Notice") shall be mailed to
each holder of record on such notice date of the Series 2 Class B Preferred
Stock. The Redemption Notice shall state: (i) the Redemption Date of such
shares, (ii) the number of Series 2 Class B Preferred Stock to be redeemed from
the holder to whom the Redemption Notice is addressed, (iii) instructions for
surrender to the Corporation, in the manner and at the place designated of a
share certificate or share certificates representing the number of Series 2
Class B Preferred Stock to be redeemed from such holder, and (iv) instructions
as to how to specify to the Corporation the number of Series 2 Class B Preferred
Stock to be redeemed as provided in this Part 4, and the number of shares to be
converted into Common Shares as provided in Part 5 hereof.

4.3  Upon receipt of the Redemption Notice, any
Eligible Holder (as defined in Section 5.2 hereof) shall have the option, at its
sole election, to specify what portion of its Series 2 Class B Preferred Stock
called for redemption in the Redemption Notice shall be redeemed as provided in
this Part 4 or converted into Common Shares in the manner provided in Part 5
hereof, except that, notwithstanding any provision of such Part 5 to the
contrary, any Eligible Holder shall have the right to convert into Common Shares
that number of Series 2 Class B Preferred Stock called for redemption in the
Redemption Notice.

4.4  On or before the Redemption Date in respect of
any Series 2 Class B Preferred Stock, each holder of such shares shall surrender
the required certificate or certificates representing such shares to the
Corporation in the manner and at the place designated in the Redemption Notice,
and upon the Redemption Date, the Redemption Price for such shares shall be made
payable, in the manner provided in Section 4.5 hereof, to the order of the
person whose name appears on such certificate or certificates as the owner
thereof, and each surrendered share certificate shall be canceled and retired.
If a share certificate is surrendered and all the shares evidenced thereby are
not being redeemed (as described below), the Corporation shall cause the Series
2

 

-4-

 

Class B Preferred Stock which are not being redeemed to be
registered in the names of the persons whose names appear as the owners on the
respective surrendered share certificates and deliver such certificate to such
person.

4.5  On the Redemption Date in respect of any Series 2
Class B Preferred Stock or prior thereto, the Corporation
shall deposit with any bank or trust company having a capital and surplus of at
least U. S. $50,000,000, as a trust fund, a sum equal to the aggregate
Redemption Price of all such shares called from redemption (less the aggregate
Redemption Price for those Series 2 Class B Preferred Stock in respect of which
the Corporation has received notice from the Eligible Holder thereof of its
election to convert Series 2 Class B Preferred Stock in to Common Shares), with
irrevocable instructions and authority to the bank or trust company to pay, on
or after the Redemption Date, the Redemption Price to the respective holders
upon the surrender of their share certificates. The deposit shall constitute
full payment for the shares to their holders, and from and after the date of the
deposit the redeemed share shall be deemed to be no longer outstanding, and
holders thereof shall cease to be shareholders with respect to such shares and
shall have no rights with respect thereto except the rights to receive from the
bank or trust company payments of the Redemption price of the shares, without
interest, upon surrender of their certificates thereof. Any funds so deposited
and unclaimed at the end of one year following the Redemption Date shall be
released or repaid to the Corporation, after which the former holders of shares
called for redemption shall be entitled to receive payment of the Redemption
Price in respect of their shares only from the Corporation.

Part 5 - Conversion.

5.1 For the purposes of conversion of the Series 2 Class B
Preferred Stock shall be valued at $1,000 per share ("Value"), and, if
converted, the Series 2 Class B Preferred Stock shall be converted into such
number of Common Shares (the "Conversion Shares") as is obtained by dividing the
aggregate Value of the shares of Series 2 Class B Preferred Stock being so
converted, together with all accrued but unpaid dividends thereon, by the
"Average Stock Price" per share of the Conversion Shares (the "Conversion
Price"), subject to adjustment pursuant to the provisions of this Part 5. For
purposes of this Part 5, the "Average Stock Price" means the lesser of (x)
seventy percent (70%) of the average daily closing bid prices of the Common
Shares for a period of five (5) consecutive trading days immediately preceding
the date of subscription by the Holder or (y) seventy percent (70%) of the
average daily closing bid prices of Common Shares for the period of five (5)
consecutive trading days immediately preceding the date of the conversion of the
Series 2 Class B Preferred Stock in respect of which such Average Stock Price is
determined. The closing price for each trading day shall be determined as
provided in the last sentence of Section 3.2.

5.2  Any holder of Series 2 Class B Preferred Stock
(an "Eligible Holder") may at any time commencing forty-five (45) days after the
issuance of any Series 2 Class B Preferred Stock convert up to one hundred
percent (100%) of his holdings of Series 2 Class B Preferred Stock in accordance
with this Part 5.

 

-5-

 

5.3  The conversion right granted by Section 5.2
hereof may be exercised only by an Eligible Holder of Series 2 Class B Preferred
Stock, in whole or in part, by the surrender of the share certificate or share
certificates representing the Series 2 Class B Preferred Stock to be converted
at the principal office of the Corporation (or at such other place as the
Corporation may designate in a written notice sent to the holder by first class
mail, postage prepaid, at its address shown on the books of the Corporation)
against delivery of that number of whole Common Shares as
shall be computed by dividing (1) the aggregate Value of the Series 2 Class B Preferred Stock so surrendered for conversion
plus any accrued but unpaid dividends thereon, if any, by
(2) the Conversion Price in effect at the date of the
conversion. At the time of conversion of a share of the
Series 2 Class B Preferred Stock, the Corporation shall pay in cash to the
holder thereof an amount equal to all unpaid dividends, if any, accrued thereon
to the date of conversion, or, at the Corporation's option, issue that number of
whole Common Shares which is equal to the product of dividing the amount of such
unpaid dividends by the Average Stock Price whether or not declared by the
Board. Each Series 2 Class B Preferred Stock share certificate surrendered for
conversion shall be endorsed by its holder. In the event of any exercise of the
conversion right of the Series 2 Class B Preferred Stock granted herein (i)
share certificate representing the Common Shares purchased by virtue of such
exercise shall be delivered to such holder within three (3) days of notice of
conversion, and (ii) unless the Series 2 Class B Preferred Stock has been fully
converted, a new share certificate representing the Series 2 Class B Preferred
Stock not so converted, if any, shall also be delivered to such holder within
three (3) days of notice of conversion. Any Eligible Holder may exercise its
right to convert the Series 2 Class B Preferred Stock by telecopying an executed
and completed Notice of Conversion to the Corporation, and within seventy-two
(72) hours thereafter, delivering the original Notice of Conversion and the
certificate representing the Series 2 Class B Preferred Stock to the Corporation
by express courier. Each date on which a Notice of Conversion is telecopied to
and received by the Corporation in accordance with the provisions hereof shall
be deemed a conversion date. The Corporation will transmit the Common Shares
certificates issuable upon conversion of any Series 2 Class B Preferred Stock
(together with the certificates representing the Series 2 Class B Preferred
Stock not so converted) to the Eligible Holder via express courier within three
(3) business days after the conversion date if the Corporation has received the
original Notice of Conversion and the Series 2 Class B Shares certificates being
so converted by such date.

5.4  All Common Shares which may be issued upon
conversion of Series 2 Class B Preferred Stock will, upon issuance, be duly
issued, fully paid and nonassessable and free from all taxes, liens, and charges
with respect to the issue thereof. At all times that any Series 2 Class B
Preferred Stock is outstanding, the Corporation shall have authorized, and shall
have reserved for the purpose of issuance upon such conversion, a sufficient
number of Common Shares to provide for the conversion into Common Shares of all
Series 2 Class B Preferred Stock then outstanding at the then effective
Conversion Price. Without limiting the generality of the foregoing, if, at any
time, the Conversion Price is decreased, the number of Common Shares authorized
and reserved for issuance upon the conversion of the Series 2 Class B Preferred
Stock shall be proportionately increased.

 

-6-

 

5.5  The number of Common Shares issued upon
conversion of Series 2 Class B Preferred Stock and the Conversion Price shall be
subject to adjustment from time to time upon the happening of certain events, as
follows:

     5.5.1 In the case of any amendment
to the Articles to change the designation of the Common
Shares 
     or the rights, privileges,
restrictions or conditions in respect of the Common Shares or division of
the
     Common Shares into series the rights of the
holders of the Series 2 Class B Preferred Stock shall
be
     adjusted so as to provide that upon
conversion thereof, the holder of the Series 2 Class B
Preferred 
     Stock being converted shall
procure, in lieu of each Common Share theretofore issuable upon
such
     conversion, the kind and amount of shares,
other securities, money and property receivable upon
such
     designation, change or division by the
holder of one Common Share issuable upon such
conversion 
     had conversion occurred
immediately prior to such designation, change or division. The Series
2 
     Class B Preferred Stock shall be deemed
thereafter to provide for adjustments which shall be
as 
     nearly equivalent as may be
practicable to the adjustments provided for in this Part 5. The
provisions 
     of this subsection 5.5.1 shall
apply in the same manner to successive reclassifications,
changes,
     consolidations, and
mergers. 

     5.5.2 If the Corporation, at any
time while any of the Series 2 Class B Preferred Stock is
outstanding, 
     shall amend the Articles so
as to change the Common Shares into a different number of shares,
the
     Conversion Price shall be proportionately
reduced, in case of such change increasing the number
of
     Common Shares, as of the effective date of
such increase, or if the Corporation shall take a record
of
     holders of its Common Shares for the purpose
of such increase, as of such record date, whichever
is
     earlier, or the Conversion Price shall be
proportionately increased, in the case of such
change 
     decreasing the number of Common
Shares, as of the effective date of such decrease or, if
the 
     Corporation shall take a record of
holders of its Common Stock for the purpose of such
decrease, 
     as of such record date,
whichever is earlier.

     5.5.3 If the Corporation, at any
time while any of the Series 2 Class B Preferred Stock is
outstanding, 
     shall pay a dividend payable
in Common Shares (except for any dividends of Common
Shares 
     payable pursuant to Part 3
hereof), the Conversion Price shall be adjusted, as of the date
the 
     Corporation shall take a record of
the holders of its Common Shares for the purposes of
receiving 
     such dividend (or if no such
record is taken, as of the date of payment of such dividend), to that
price
     determined by multiplying the Conversion
Price therefor in effect by a fraction (1) the numerator
of 
     which shall be the total number of
Common Shares outstanding immediately prior to such
dividend, 
     and (2) the denominator of
which shall be the total number of Common Shares
outstanding 
     immediately after such
dividend (plus in the event that the Corporation paid cash for fractional
shares, 
     the number of additional shares
which would have been outstanding had the Corporation
issued 
     fractional shares in connection
with said dividend).

5.6  Whenever the Conversion Price shall be adjusted
pursuant to Section 5.5 hereof, the Corporation shall make a certificate signed
by its President, or a Vice President and by its Treasurer, Assistant
Treasurer,

 

-7-

 

Secretary or Assistant Secretary, setting forth, in reasonable
detail, the event requiring the adjustment, the amount of the adjustment, the
method by which such adjustment was calculated (including a description of the
basis on which the Board of Directors made any determination hereunder), and the
Conversion Price after giving effect to such adjustment, and shall cause copies
of such certificates to be mailed (by first class mail, postage prepaid) to each
holder of the Series 2 Class B Preferred Stock at its address shown on the books
of the Corporation. The Corporation shall make such certificate and mail it to
each such holder promptly after each adjustment.  

5.7  No fractional Common Shares shall be issued in
connection with any conversion of Series 2 Class B Preferred Stock, but in lieu
of such fractional shares, the Corporation shall make a cash payment therefor
equal in amount to the product of the applicable fraction multiplied by the
Conversion Price then in effect.

5.8 No Series 2 Class B Preferred Stock which has been converted
into Common Shares shall be reissued by the Corporation; provided, however, that
each such share shall be restored to the status of authorized but unissued
Preferred Stock without designation as to series and may thereafter be issued as
a series of Preferred Stock not designated as Series 2 Class B Preferred
Stock.

Part 6 - Parity with Other Shares of Series 2 Class B
Preferred Stock and
Priority.

6.1  If any cumulative dividends or accounts payable
or return of capital in respect of Series 2 Class B Preferred Stock are not paid
in full, the owners of all series of outstanding Preferred Stock shall
participate rateably in respect of accumulated dividends and return of
capital.

6.2  For purposes of this resolution, any stock of any
class or series of the Corporation shall be deemed to rank: 

     6.2.1 Prior or senior to the
shares of this Series 2 Class B Preferred Stock either as to dividends
or 
     upon liquidation, if the holders of
such class or classes shall be entitled to the receipt of
dividends 
     or of amounts distributable
upon dissolution, liquidation or winding up of the Corporation,
whether 
     voluntary or involuntary, as the
case may be, in preference or priority to the holders of shares
of 
     this Series 2 Class B Preferred
Stock;

     6.2.2 On a parity with, or equal
to, shares of this Series 2 Class B Preferred Stock, either as
to 
     dividends or upon liquidation, whether
or not the dividend rates, dividend payment dates,
or 
     redemption or liquidation prices per
share or sinking fund provisions, if any, are different from
those 
     of this Series 2 Class B Preferred
Stock, if the holders of such stock are entitled to the receipt
of 
     dividends or of amounts distributable
upon dissolution, liquidation or winding up of the
Corporation,
     whether voluntary or involuntary,
in proportion to their respective dividend rates or
liquidation 
     prices, without preference or
priority, one over the other, as between the holders of such stock
and 

 

-8-

 


     over the other, as between the
holders of such stock and the holders of shares of this Series
2 
     Class B Preferred Stock;
and,

     6.2.3 Junior to shares of this
Series 2 Class B Preferred Stock, either as to dividends or
upon 
     liquidation, if such class or series
shall be Common Shares or if the holders of shares of this
Series 
     2 Class B Preferred Stock shall be
entitled to receipt of dividends or of amounts
distributable 
     upon dissolution,
liquidation or winding up of the Corporation, whether voluntary or
involuntary, 
     as the case may be, in
preference or priority to the holders of shares of such class or
series.

Part 7 - Amendment.

7.1  In addition to any requirement for a series vote
pursuant to the GCL in respect of any amendment to the
Articles that adversely affects the rights, privileges,
restrictions and conditions of the Series 2 Class B
Preferred Stock, the rights, privileges, restrictions and
conditions attaching to the Series 2 Class B Preferred Stock
may be amended by an amendment to the Corporation's Certificate of Incorporation so as to affect such adversely only if the
Corporation has obtained the affirmative vote at a duly called and held series
meeting of the holders of the Series 2 Class B Preferred Stock or written
consent by the holders of a majority of the Series 2 Class B Preferred Stock
then outstanding. Notwithstanding the above, the number of authorized shares of
such class or classes of stock may be increased or decreased (but not below the
number of shares thereof outstanding) by the affirmative vote of the holders of
a majority of the stock of the Corporation entitled to vote thereon, voting
together as a single class, irrespective of this Section 7.1.

 

 

 

 

-9-

 

 

CERTIFICATE OF DESIGNATIONS
OF SERIES 3 CLASS
C CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES,
INC.


     Perma-Fix Environmental Services,
Inc. (the "Corporation"), a corporation organized and
existing under the General Corporation Law of the State of
Delaware, does hereby certify:

     That, pursuant to authority
conferred upon by the Board of Directors by the Corporation's Restated
Certificate of Incorporation, as amended, and pursuant to the provisions of
Section 151 of the Delaware Corporation Law, the Board of Directors of the
Corporation has adopted resolutions, a copy of which is attached hereto,
establishing and providing for the issuance of a series of Preferred Stock
designated as Series 3 Class C Convertible Preferred Stock and has established
and fixed the voting powers, designations, preferences and relative
participating, optional and other special rights and qualifications, limitations
and restrictions of such Series 3 Class C Convertible Preferred Stock as set
forth in the attached resolutions.

Dated: July 17, 1996

                                                        PERMA-FIX
ENVIRONMENTAL SERVICES, INC.



                                                         By
/s/ Louis F.
Centofanti                                             
                                                              Dr.
Louis F.
Centofanti
                                                              Chairman
of the Board
ATTEST:



/s/ Richard T.
Kelecy                   
Richard
T. Kelecy, Secretary


 

 

 

PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the
"Corporation")

RESOLUTION OF THE BOARD OF
DIRECTORS

FIXING THE NUMBER AND DESIGNATING THE RIGHTS,
PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 3 CLASS C
CONVERTIBLE PREFERRED STOCK


WHEREAS,

A.  The Corporation's share capital includes Preferred
Stock, par value $.001 per share
("Preferred 
      Stock"), which
Preferred Stock may be issued in one or more series by the Board of
Directors 
      of the Corporation (the
"Board") being entitled by resolution to fix the number of shares in
each 
      series and to designate the
rights, designations, preferences, and relative, participating,
optional 
      or other special rights,
privileges, restrictions and conditions attaching to the shares of each
such 
      series; and

B.  It is in the best interests of the Corporation for
the Board to create a new series from the
Preferred
     Stock designated as the Series 3
Class C Convertible Preferred Stock, par value $.001.

NOW, THEREFORE, BE IT RESOLVED, THAT:

     The Series 3 Class C Convertible
Preferred Stock, par value $.001 (the "Series 3 Class C
Preferred
     Stock") of the Corporation shall consist of 5,500 shares and no more and shall be designated as the 
     Series
3 Class C Convertible Preferred Stock, and the preferences,
rights, privileges, restrictions 
     and conditions
attaching to the Series 3 Class C Preferred Stock shall be
as follows:

Part 1 - Voting and Preemptive Rights.

1.1  Voting Rights. Except as otherwise
provided herein, in the Corporation's Certificate of Incorporation (the
"Articles") or the General Corporation Law of the State of Delaware (the "GCL"),
the holders of the Series 3 Class C Preferred Stock shall have no voting rights
whatsoever. To the extent that under the GCL the vote of the holders of the
Series 3 Class C Preferred Stock, voting separately as a class or series as
applicable, is required to authorize a given action of the Corporation, the
affirmative vote or consent of the holders of at least a majority of the shares
of the Series 3 Class C Preferred Stock represented at a duly held meeting at
which a quorum is present or by written consent of a majority of the shares of
Series 3 Class C Preferred Stock (except as otherwise may be required under the
GCL) shall constitute the approval of such action by the series. To the extent
that under the GCL the holders of the Series 3 Class C Preferred Stock are
entitled to vote on a matter with holders of Corporation's Common Stock and/or
any other class or series of the Corporation's voting securities, the Series 3
Class C Preferred Stock, the Corporation's Common Stock and all other
classes

 

 

or series of the Corporation's voting securities shall vote
together as one class, with each share of Series 3 Class C Preferred Stock
entitled to a number of votes equal to the number of shares of the Corporation's
Common Stock into which it is then convertible using the record date for the
taking of such vote of stockholders as the date as of which the Conversion Price
(as defined in Section 4.2 hereof) is calculated and conversion is effected.
Holders of the Series 3 Class C Preferred Stock shall be entitled to notice of
(and copies of proxy materials and other information sent to stockholders) for
all shareholder meetings or written consents with respect to which they would be
entitled to vote, which notice would be provided pursuant to the Corporation's
bylaws and applicable statutes.

1.2  No Preemptive Rights. The Series 3
Class C Preferred Stock shall not give its holders any preemptive rights to
acquire any other securities issued by the Corporation at any time in the
future.

Part 2 - Liquidation Rights.

2.1 Liquidation. If the Corporation shall be
voluntarily or involuntarily liquidated, dissolved or wound up at any time when
any shares of the Series 3 Class C Preferred Stock shall be outstanding, the holders of the then outstanding Series 3 Class C
Preferred Stock shall have a preference in distribution of the Corporation's
property available for distribution to the holders of the Corporation's Common
Stock equal to $1,000 consideration per outstanding share of Series 3 Class C
Preferred Stock, plus an amount equal to all unpaid dividends accrued thereon to
the date of payment of such distribution ("Liquidation Preference"), whether or
not declared by the Board.

2.2 Payment of Liquidation Preferences. Subject to
the provisions of Part 6 hereof, all amounts to be paid as Liquidation
Preference to the holders of Series 3 Class C Preferred Stock, as provided in
this Part 2, shall be paid or set apart for payment before the payment or
setting apart for payment of any amount for, or the distribution of any of the
Corporation's property to the holders of the Corporation's Common Stock, whether
now or hereafter authorized, in connection with such liquidation, dissolution or
winding up.

2.3 No Rights After Payment. After the payment to
the holders of the shares of the Series 3 Class C Preferred Stock of the full
Liquidation Preference amounts provided for in this Part 2, the holders of the
Series 3 Class C Preferred Stock as such shall have no right or claim to any of
the remaining assets of the Corporation.

2.4 Assets Insufficient to Pay Full Liquidation
Preference. In the event that the assets of the Corporation available
for distribution to the holders of shares of the Series 3 Class C Preferred
Stock upon any dissolution, liquidation or winding up of the Corporation,
whether voluntary or involuntary, shall be insufficient to pay in full all
amounts to which such holders are entitled pursuant to this Part 2, no such
distribution shall be made on account of any shares of any other class or series
of Preferred Stock ranking on a parity with the shares of this Series 3 Class C
Preferred Stock upon such dissolution, liquidation or winding up unless
proportionate distributive amounts shall be paid on account of the shares of
this Series 3 Class C Preferred Stock and shares of such other class or series
ranking on a parity with the shares of this Series 3 Class C Preferred Stock,
ratably, in proportion to the full distributable amounts for which holders of
all such parity shares are respectively entitled upon such dissolution,
liquidation or winding up.

 

-2-

 

Part 3 - Dividends.

3.1 The holders of the Series 3 Class C Preferred Stock
are entitled to receive if, when and as declared by the
Board out of funds legally available therefor, cumulative
dividends, payable in cash or Common Stock of the
Corporation, par value $.001 per share (the "Common Stock"),
at the Corporation's election, at the rate of six percent
(6%) per annum of the Liquidation Value of the Series 3
Class C Preferred Stock. The Liquidation Value of the Series 3 Class C Preferred
Stock shall be $1,000.00 per share (the "Dividend Rate"). The dividend is
payable semi-annually within seven (7) business days after each of December 31
and June 30 of each year, commencing December 31, 1996 (each, a "Dividend
Declaration Date"). Dividends shall be paid only with respect to shares of
Series 3 Class C Preferred Stock actually issued and outstanding on a Dividend
Declaration Date and to holders of record as of the Dividend Declaration Date.
Dividends shall accrue from the first day of the semi-annual period in which
such dividend may be payable, except with respect to the first semi-annual
dividend which shall accrue from the date of issuance of the Series 3 Class C
Preferred Stock. In the event that the Corporation elects to pay dividends in
Common Stock of the Corporation, each holder of the Series 3 Class C Preferred
Stock shall receive shares of Common Stock of the Corporation equal to the
quotient of (i) the Dividend Rate in effect on the applicable Dividend
Declaration Date dividend by (ii) the average of the closing bid quotation of
the Common Stock as reported on the over-the-counter market, or the closing sale
price if listed on a national securities exchange, for the five (5) trading days
immediately prior to the Dividend Declaration Date (the "Stock Dividend Price").
Dividends on the Series 3 Class C Preferred Stock shall be cumulative, and no
dividends or other distributions shall be paid or declared or set aside for
payment on the Common Stock until all accrued and unpaid dividends on all
outstanding shares of Series 3 Class C Preferred Stock shall have been paid or
declared and set aside for payment.

Part 4 - Conversion. The holders of the Series 3
Class C Preferred Stock shall have rights to convert the shares of Series 3
Class C Preferred Stock into shares of the Corporation's Common Stock, par value
$.001 per share ("Common Stock"), as follows (the "Conversion
Rights"):

4.1 Right to Convert. The Series 3 Class C
Preferred Stock shall be convertible into shares of Common Stock, as
follows:

     4.1.1  Up to one
thousand eight hundred thirty-three (1,833) shares of Series 3 Class C
Preferred 
               Stock
may be converted at the Conversion Price (as that term is defined in Section 4.2
below) 
               at
any time on or after October 1, 1996;

 

-3-

 

     4.1.2  Up to one
thousand eight hundred thirty-three (1,833) shares of Series 3 Class C
Preferred 
               Stock
may be converted at the Conversion Price at any time on or after November 1,
1996; and,

     4.1.3  Up to one
thousand eight hundred thirty-four (1,834) shares of Series 3 Class C
Preferred 
               Stock
may be converted at the Conversion Price on or after December 1,
1996.

4.2  Conversion Price. As used herein, the
term Conversion Price shall be the product of (i) the average closing bid
quotation of the Common Stock as reported on the over-the-counter market, or the
closing sale price if listed on a national securities exchange, for the five (5)
trading days immediately preceding the date of the Conversion Notice referred to
in Section 4.3 below multiplied by (ii) seventy-five percent (75%).
Notwithstanding the foregoing, the Conversion Price shall not be (i) less than a
minimum of $.75 per share ("Minimum Conversion Price") or (ii) more than a
maximum of $1.50 per share ("Maximum Conversion Price"). If, after July 1, 1996,
the Corporation sustains a net loss, on a consolidated basis, in each of two (2)
consecutive quarters, as determined under generally accepted accounting
principles, the Minimum Conversion Price shall be reduced $.25 a share, but
there shall be no change to, or reduction of, the Maximum Conversion Price. For
the purpose of determining whether the Corporation has had a net loss in each of
two (2) consecutive quarters, at no time shall a quarter that has already been
considered in such determination be considered in any subsequent determination
(as an example the third quarter of 1996 in which there is a net profit and the
fourth quarter of 1996 in which there is a net loss shall be considered as two
consecutive quarters, and, as a result, the fourth quarter of 1996 shall not be
considered along with the first quarter of 1997 as two (2) consecutive quarters,
but the first quarter of 1997 must be considered with the second quarter of 1997
for the purposes of such determination). For the purposes of this Section 4.2, a
"quarter" is a three (3) month period ending on March 31, June 30, September 30,
and December 31. If any of the outstanding shares of Series 3 Class C Preferred
Stock are converted, in whole or in part, into Common Stock pursuant to the
terms of this Part 4, the number of shares of whole Common Stock to be issued to
the holder as a result of such conversion shall be determined by dividing (a)
the aggregate Liquidation Value of the Series 3 Class C Preferred Stock
so surrendered for conversion by (b) the Conversion Price in
effect at the date of the conversion. At the time of
conversion of shares of the Series 3 Class C Preferred Stock, the Corporation
shall pay in cash to the holder thereof an amount equal to all unpaid and
accrued dividends, if any, accrued thereon to the date of conversion, or, at the
Corporation's option, in lieu of paying cash for the accrued and unpaid
dividends, issue that number of shares of whole Common Stock which is equal to
the product of dividing the amount of such unpaid and accrued dividends to the
date of conversion on the shares of Series 3 Class C Preferred Stock so
converted by the Conversion Price in effect at the date of
conversion.

4.3  Mechanics of Conversion. Any holder
of the Series 3 Class C Preferred Stock who wishes to exercise its Conversion
Rights pursuant to Section 4.1 of this Part 4 must, if such shares are not being
held in escrow by the Corporation's attorneys, surrender the certificate
therefor at the principal executive office of the

 

-4-

 

Corporation, and give written notice, which may be via facsimile
transmission, to the Corporation at such office that it elects to convert the
same (the "Conversion Notice"). In the event that the shares of Series 3 Class C
Preferred Stock are being held in escrow by the Corporation's attorneys, no
delivery of the certificates shall be required. No Conversion Notice with
respect to any shares of Series 3 Class C Preferred Stock can be given prior to
the time such shares of Series 3 Class C Preferred Stock are eligible for
conversion in accordance with the provision of Section 4.1 above.  Any such
premature Conversion Notice shall automatically be null and void. The
Corporation shall, within five (5) business days after receipt of an appropriate
and timely Conversion Notice (and certificate, if necessary), issue to such
holder of Series 3 Class C Preferred Stock or its agent a certificate for the
number of shares of Common Stock to which he shall be entitled; it being
expressly agreed that until and unless the holder delivers written notice to the
Corporation to the contrary, all shares of Common Stock issuable upon conversion
of the Series 3 Class C Preferred Stock hereunder are to be delivered by the
Corporation to a party designated in writing by the holder in the Conversion
Notice for the account of the holder and such shall be deemed valid delivery to
the holder of such shares of Common Stock. Such conversion shall be deemed to
have been made only after both the certificate for the shares of Series 3 Class
C Preferred Stock to be converted have been surrendered and the Conversion
Notice is received by the Corporation (or in the event that no surrender of the
Certificate is required, then only upon the receipt by the Corporation of the
Conversion Notice) (the "Conversion Documents"), and the person or entity whose
name is noted on the certificate evidencing such shares of Common Stock issuable
upon such conversion shall be treated for all purposes as the record holder of
such shares of Common Stock at and after such time. In the event that the
Conversion Notice is sent via facsimile transmission, the Corporation shall be
deemed to have received such Conversion Notice on the first business day on
which such facsimile Conversion Notice is actually received. If the Corporation
fails to deliver to the holder or its agent the certificate representing the
shares of Common Stock that the holder is entitled to receive as a result of
such conversion within five (5) business days after receipt by the Corporation
from the holder of an appropriate and timely Conversion Notice and certificates
pursuant to the terms of this Section 4.3, the Corporation shall pay to the
holder U.S. $1,000 for each day that the Corporation is late in delivering such
certificate to the holder or its agent.

4.4  Adjustments to Conversion Price for Stock
Dividends and for Combinations or Subdivisions of Common Stock. If the
Corporation at any time or from time to time while shares of Series 3 Class C
Preferred Stock are issued and outstanding shall declare or pay, without
consideration, any dividend on the Common Stock payable in Common Stock, or
shall effect a subdivision of the outstanding shares of Common Stock into a
greater number of shares of Common Stock (by stock split, reclassification or
otherwise than by payment of a dividend in Common Stock or in any right to
acquire Common Stock), or if the outstanding shares of Common Stock shall be
combined or consolidated, by reclassification or otherwise, into a lesser number
of shares of Common Stock, then the Conversion Price in effect immediately
before such event shall, concurrently with the effectiveness of such event, be
proportionately decreased or increased, as appropriate. If the Corporation shall
declare or pay, without consideration, any dividend on the Common Stock payable
in any right to acquire Common stock for no consideration, then the Corporation
shall be deemed to have made a

 

-5-

 

dividend payable in Common Stock in an amount of shares equal to
the maximum number of shares issuable upon exercise of such rights to acquire
Common Stock.

4.5.  Adjustments for Reclassification and
Reorganization. If the Common Stock issuable upon conversion of the
Series 3 Class C Preferred Stock shall be changed into the same or a different
number of shares of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise (other than a subdivision or
combination of shares provided for in Section 4.4 hereof), the Conversion Price
then in effect shall, concurrently with the effectiveness of such reorganization
or reclassification, be proportionately adjusted so that the Series 3 Class C
Preferred Stock shall be convertible into, in lieu of the number of shares of
Common Stock which the holders of Series 3 Class C Preferred Stock would
otherwise have been entitled to receive, a number of shares of such other class
or classes of stock equivalent to the number of shares of Common Stock that
would have been subject to receipt by the holders upon conversion of the Series
3 Class C Preferred Stock immediately before that change.

4.6  Common Stock Duly Issued. All
Common Stock which may be issued upon conversion of Series 3 Class C Preferred
Stock will, upon issuance, be duly issued, fully paid and nonassessable and free
from all taxes, liens, and charges with respect to the issue thereof.

4.7  Notice of Adjustments. Upon the
occurrence of each adjustment or readjustment of any Conversion Price pursuant
to this Part 4, the Corporation, at its expense, within a reasonable period of
time, shall compute such adjustment or readjustment in accordance with the terms
hereof and prepare and furnish to each holder of Series 3 Class C Preferred
Stock a notice setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment is based.

4.8  Issue Taxes. The Corporation shall
pay any and all issue and other taxes that may be payable in
respect of any issue or delivery of shares of Common Stock
on conversion of the Series 3 Class C Preferred Stock
pursuant thereto; provided, however, that the Corporation shall not be obligated
to pay any transfer taxes resulting from any transfer requested by any holder of
Series 3 Class C Preferred Stock in connection with such conversion.

4.9  Reservation of Stock Issuable Upon
Conversion. The Corporation shall at all times reserve and keep
available out of its authorized but unissued shares of Common Stock, solely for
the purpose of effecting the conversion of the shares of the Series 3 Class C
Preferred Stock, such number of its shares of Common Stock as shall, from time
to time, be sufficient to effect the conversion of all outstanding shares of the
Series 3 Class C Preferred stock, and, if at any time, the number of authorized
but unissued shares of Common Stock shall not be sufficient to effect the
conversion of all then outstanding shares of the Series 3 Class C Preferred
Stock, the Corporation will take such corporate action as may be necessary to
increase its authorized but unissued shares of Common Stock to such number of
shares as shall be sufficient for such purposes, including, without limitation,
engaging in reasonable efforts to obtain the requisite stockholder approval of
any necessary amendment to its Certificate of Incorporation.

 

-6-

 

4.10  Fractional Shares. No fractional
share shall be issued upon the conversion of any share or shares of Series 3
Class C Preferred Stock. All shares of Common Stock (including fractions
thereof) issuable upon conversion of more than one share of Series 3 Class C
Preferred Stock by a holder thereof shall be aggregated for purposes of
determining whether the conversion would result in the issuance of any
fractional share. If, after the aforementioned aggregation, the conversion would
result in the issuance of a fractional share of Common Stock, such fractional
share shall be rounded up to the nearest whole share.

4.11 Notices. Any notices required by the
provisions of this Part 4 to be given to the holders of shares of Series 3 Class
C Preferred Stock shall be deemed given if deposited in the United States mail,
postage prepaid, and addressed to each holder of record at his address appearing
on the books of the Corporation.

4.12 Business Day. As used herein, the term
"business day" shall mean any day other than a Saturday, Sunday or a day when
the federal and state banks located in the State of New York are required or
permitted to close.

Part 5 - Redemption.

5.1 Redemption During First 180 Days. At any time,
and from time to time, during the first one hundred eighty (180) days from the
date of issuance of the Series 3 Class C Preferred Stock, the Corporation may,
at its sole option, but shall not be obligated to, redeem, in whole or in part,
the then outstanding Series 3 Class C Preferred Stock at a price per share of U.
S. $1,300.00 each ("First Six Months Redemption Price"). The Company may
exercise such redemption by giving the holder of the Series 3 Class C Preferred
Stock written notice of such redemption at any time during such 180-day
period.

5.2  Other Rights of Redemption by the
Corporation. At any time, and from time to time, after one hundred
eighty (180) days from the date of the issuance of any Series 3 Class C
Preferred Stock, if the average of the closing bid price of the Common Stock for
ten (10) consecutive days shall be in excess of $2.50 per share, the Corporation
may, at its sole option, but shall not be obligated to, redeem, in whole or in
part, the then outstanding Series 3 Class C Preferred Stock at a price per share
of U. S. $1,000 each (the "Redemption Price") (such price to be adjusted
proportionately in the event of any change of the Series 3 Class C Preferred
Stock into a different number of shares of Series 3 Class C Preferred
Stock).

5.3 Mechanics of Redemption. Thirty (30) days
prior to any date stipulated by the Corporation for the
redemption of Series 3 Class C Preferred Stock (the "Redemption Date"), written
notice (the "Redemption Notice") shall be mailed to each holder of record on
such notice date of the Series 3 Class C Preferred Stock. The Redemption Notice
shall state: (i) the Redemption Date of such shares, (ii) the number of Series 3
Class C Preferred Stock to be redeemed from the holder to whom the Redemption
Notice is addressed, (iii) instructions for surrender to the Corporation, in the
manner and at the place designated, of a share certificate or share certificates
representing the number of Series 3 Class C Preferred Stock to be redeemed from
such

 

-7-

 

holder, and (iv) instructions as to how to specify to the
Corporation the number of Series 3 Class C Preferred Stock to be redeemed as
provided in this Part 5 and, if the Redemption Notice is mailed to the Holder
after the first one hundred eighty (180) days from the date of issuance of the
Series 3 Class C Preferred Stock, the number of shares to be converted into
Common Stock as provided in Part 4 hereof.

5.4 Rights of Conversion Upon Redemption. If the
redemption occurs pursuant to Section 5.1 hereof, the Holder of the Series 3
Class C Preferred Stock shall not have the right to convert those outstanding
shares of Series 3 Class C Preferred Stock that the Company is redeeming after
receipt of the Redemption Notice. If the redemption occurs pursuant to Section
5.2 hereof, then, upon receipt of the Redemption Notice, any holder of Series 3
Class C Preferred Stock shall have the option, at its sole election, to specify
what portion of its Series 3 Class C Preferred Stock called for redemption in
the Redemption Notice shall be redeemed as provided in this Part 5 or converted
into Common Stock in the manner provided in Part 4 hereof, except that,
notwithstanding any provision of such Part 4 to the contrary, such holder shall
have the right to convert into Common Stock that number of Series 3 Class C
Preferred Stock called for redemption in the Redemption Notice.

5.5  Surrender of Certificates. On or
before the Redemption Date in respect of any Series 3 Class C Preferred Stock,
each holder of such shares shall surrender the required certificate or
certificates representing such shares to the Corporation in the manner and at
the place designated in the Redemption Notice, and upon the Redemption Date, the
Redemption Price for such shares shall be made payable, in the manner provided
in Section 5.5 hereof, to the order of the person whose name appears on such
certificate or certificates as the owner thereof, and each surrendered share
certificate shall be canceled and retired. If a share certificate is surrendered
and all the shares evidenced thereby are not being redeemed (as described
below), the Corporation shall cause the Series 3 Class C Preferred Stock which
are not being redeemed to be registered in the names of the persons or entity
whose names appear as the owners on the respective surrendered share
certificates and deliver such certificate to such person.

5.6  Payment. On the
Redemption Date in respect of any Series 3 Class C Preferred Stock or prior
thereto, the Corporation shall deposit with any bank or trust company having a
capital and surplus of at least U. S. $50,000,000, as a trust fund, a sum equal
to the aggregate First Six Months Redemption Price or the Redemption Price,
whichever is applicable, of all such shares called from redemption (less the
aggregate Redemption Price for those Series 3 Class C Preferred Stock in respect
of which the Corporation has received notice from the holder thereof of its
election to convert Series 3 Class C Preferred Stock into Common Stock), with
irrevocable instructions and authority to the bank or trust company to pay, on
or after the Redemption Date, the First Six Months Redemption Price or the
Redemption Price, whichever is applicable, to the respective holders upon the
surrender of their share certificates. The deposit shall constitute full payment
for the shares to their holders, and from and after the date of the deposit the
redeemed shares shall be deemed to be no longer outstanding, and holders thereof
shall cease to be shareholders with respect to such shares and shall have no
rights with respect thereto except the rights to receive from the bank or trust
company payments of the

 

-8-

 

First Six Months Redemption Price or the Redemption Price,
whichever is applicable, of the shares, without interest, upon surrender of
their certificates thereof. Any funds so deposited and unclaimed at the end of
one year following the Redemption Date shall be released or repaid to the
Corporation, after which the former holders of shares called for redemption
shall be entitled to receive payment of the First Six Months Redemption Price or
the Redemption Price, whichever is applicable, in respect of their shares only
from the Corporation.

Part 6 - Parity with Other Shares of Series 3 Class C
Preferred Stock and Priority.

6.1  Rateable Participation. If any
cumulative dividends or return of capital in respect of Series 3 Class C
Preferred Stock are not paid in full, the owners of all series of outstanding
Preferred Stock shall participate rateably in respect of accumulated dividends
and return of capital.

6.2  Ranking. For purposes of this
resolution, any stock of any class or series of the Corporation shall be deemed
to rank:

      6.2.1  Prior or
senior to the shares of this Series 3 Class C Preferred Stock either as to
dividends 
                or
upon liquidation, if the holders of such class or classes shall be entitled to
the receipt
of 
                dividends
or of amounts distributable upon dissolution, liquidation or winding up of
the 
                Corporation,
whether voluntary or involuntary, as the case may be, in preference or
priority 
                to
the holders of shares of this Series 3 Class C Preferred Stock;

     6.2.2  On a parity with,
or equal to, shares of this Series 3 Class C Preferred Stock, either as
to 
               dividends
or upon liquidation, whether or not the dividend rates, dividend payment dates,
or
               redemption
or liquidation prices per share or sinking fund provisions, if any, are
different
from 
               those
of this Series 3 Class C Preferred Stock, if the holders of such stock are
entitled to
the 
               receipt
of dividends or of amounts distributable upon dissolution, liquidation or
winding up of
the
               Corporation,
whether voluntary or involuntary, in proportion to their respective dividend
rates
or
               liquidation
prices, without preference or priority, one over the other, as between the
holders
of 
               such
stock and over the other, as between the holders of such stock and the holders
of
shares 
               of
this Series 3 Class C Preferred Stock; and,

     6.2.3  Junior to shares
of this Series 3 Class C Preferred Stock, either as to dividends or
upon 
               liquidation,
if such class or series shall be Common Stock or if the holders of shares of
this 
               Series
3 Class C Preferred Stock shall be entitled to receipt of dividends or of
amounts 
               distributable
upon dissolution, liquidation or winding up of the Corporation, whether
voluntary
               or
involuntary, as the case may be, in preference or priority to the holders of
shares of
such 
               class
or series.

 

 

-9-

 

Part 7 - Amendment and Reissue.

7.1  Amendment. If any proposed
amendment to the Corporation's Certificate of Incorporation would alter or
change the powers, preferences or special rights of the Series 3 Class C
Preferred Stock so as to affect such adversely, then the Corporation must obtain
the affirmative vote of such amendment to the Certificate of Incorporation at a
duly called and held series meeting of the holders of the Series 3 Class C
Preferred Stock or written consent by the holders of a majority of the Series 3
Class C Preferred Stock then outstanding. Notwithstanding the above, the number
of authorized shares of any class or classes of stock may be increased or
decreased (but not below the number of shares thereof outstanding) by the
affirmative vote of the holders of a majority of the stock of the Corporation
entitled to vote thereon, voting together as a single class, irrespective of
this Section 7.1 or the requirements of Section 242 of the GCL.

7.2  Authorized. Any shares of Series 3
Class C Preferred Stock acquired by the Corporation by
reason of purchase, conversion, redemption or otherwise
shall be retired and shall become authorized but unissued
shares of Preferred Stock, which may be reissued as part of
a new series of Preferred Stock hereafter created.
 
 

 

 

 

 

-10-

 

CERTIFICATE OF ELIMINATION
OF
SERIES I
CLASS A PREFERRED STOCK
AND
SERIES 2 CLASS B CONVERTIBLE PREFERRED
STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES,
INC.
____________________________________________


     PERMA-FIX ENVIRONMENTAL
SERVICES, INC., a corporation organized and existing under
the Delaware General Corporation Law of the State of
Delaware (hereinafter called the "Corporation"), hereby
certifies the following: 

     1.  That the Certificate
of Designations of Series I Class A Preferred Stock of the
Corporation (the "Series I Preferred") was filed on February
6, 1996 (the "Series I Certificate of Designations").

     2.  That
all outstanding shares of the Series I Preferred have been converted into shares
of common stock of the Company pursuant to the terms and conditions of the
Series I Certificate of Designations.

     3.  That no shares of
Series I Preferred remain
outstanding.

     4.  That all shares
of the Series I Preferred which have been converted have the status of
authorized and unissued shares of the Preferred Stock of the Corporation without
designation as to series, until such shares are once more designated as part of
a particular series by the Board of Directors.

     5. That on September 19, 1996, the
Board of Directors of the company duly adopted the following
resolution:

          RESOLVED,
that no authorized shares of Series I Class A Preferred
Stock remain
outstanding
         
and no shares of Series I Class A Preferred Stock will be issued subject to the Certificate
of 
          Designation
previously filed with respect to the Series I Class A
Preferred Stock.

     6.  That the Certificate
of Designations of the Series 2 Class B Convertible Preferred Stock of the
Corporation (the "Series 2 Preferred") was filed on February 20, 1996 (the
"Series 2 Certificate of Designations").

     7.  That all outstanding
shares of the Series 2 Preferred have been converted into shares of common stock
of the Company pursuant to the terms and conditions of the Series 2 Certificate
of Designations.

 

 

 

     8. That no shares of Series 2
Preferred remain outstanding.

     9.  That all shares of
the Series 2 Preferred which have been converted have the
status of authorized and unissued shares of the Preferred
Stock of the Corporation without designation as to series,
until such shares are once more designated as part of a particular series by the Board of Directors.

     10.  That on September 19,
1996, the Board of Directors of the company duly adopted the
following resolution:

          RESOLVED,
that no authorized shares of Series 2 Class B Preferred
Stock remain
outstanding
          and no shares of Series 2 Class B Convertible Preferred Stock will be issued subject to the 
          Certificate
of Designation previously filed with respect to the Series 2
Class B Convertible 
          Preferred
Stock.

     11.  That pursuant to
the provisions of Section 151(g) of the Delaware General
Corporation Law, upon the effective date of the filing of
this Certificate, this Certificate will have the effect of
eliminating from the Restated Certificate of Incorporation only those matters set forth in the Restated Certificate of Incorporation with respect to the Series I Class A Preferred Stock
and the Series 2 Class B Convertible Preferred Stock.

     IN WITNESS WHEREOF, this
Certificate of Elimination has been executed this 4th day of December, 1996, by
the President of the Company.

                                                                             PERMA-FIX
ENVIRONMENTAL
ATTEST:                                                              SERVICES,
INC.



/s/
Richard T. Kelecy
                                            By
/s/ Louis
Centofanti                              
Richard
T. Kelecy,
Secretary                                      Dr.
Louis F.
Centofanti,
                                                                                   President


 

 

 

 

-2-

 

 

CERTIFICATE OF AMENDMENT
OF
RESTATED
CERTIFICATE OF INCORPORATION
OF
PERMA-FIX ENVIRONMENTAL SERVICES,
INC.
___________________________________________


     Perma-Fix Environmental Services,
Inc., a Delaware corporation (the "Corporation"), for
purposes of amending its Restated Certificate of
Incorporation, as amended ("Restated Certificate of
Incorporation"), as provided by Section 242 of the Delaware
General Corporation Law, does hereby certify: 

     1.  The amendment set
forth below to the Corporation's Restated Certificate of
Incorporation was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of
the State of Delaware:

          The
first paragraph of Article Fourth of the Corporation's
Restated Certificate of Incorporation is hereby deleted and
replaced in its entirety by the following:

          The
total number of shares of capital stock that the Corporation shall have
authority to
issue
          is
52,000,000, of which 50,000,000 shall be designated as common stock of the par
value 
          of
$.001 per share ("Common Stock") and 2,000,000 shall be designated as preferred
stock
          of the par
value of $.001 per share ("Preferred Stock").

     2.  Only the first
paragraph of Article Fourth is amended by this Amendment,
and the remainder of Article Fourth shall remain in full
force and effect. No other provision, paragraph or article of the Restated Certificate of Incorporation is amended or changed by
this Amendment. The Restated Certificate of Incorporation,
as expressly amended by paragraph 1 of this Amendment, shall
be in full force and effect.

     3.  At a meeting of the
Board of Directors held on the 19th day of September, 1996,
a resolution was duly adopted setting forth the foregoing
proposed amendment to the first paragraph of Article Fourth
of the Restated Certificate of Incorporation, declaring such amendment to be advisable and setting the next Annual Meeting of
Stockholders for consideration thereof.
     4.  Thereafter, pursuant to said
resolution of its Board of Directors, the Annual Meeting of
Stockholders was duly called and held on December 12, 1996,
at which meeting the necessary number of shares as required
by statute were voted in favor of such amendment.
 

 

 

     IN WITNESS whereof, Perma-Fix
Environmental Services, Inc. has caused this Certificate to
be signed and attested to by its duly authorized officers as
of this 16th day of December, 1996.

                                                                                         Perma-Fix
Environmental
                                                                                         Services,
Inc.,
                                                                                         a Delaware corporation

                                                                                         By:
/s/Louis F.
Centofanti                       
                                                                                                Dr. Louis F.
Centofanti
                                                                                                President
and
                                                                                                Chief Executive Officer

ATTEST:


/s/ Richard T.
Kelecy                       
Richard
T. Kelecy,
Secretary



 

 

 

 

-2-

 

CERTIFICATE OF DESIGNATIONS
OF SERIES 4 CLASS
D CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES,
INC.


     Perma-Fix Environmental Services,
Inc. (the "Corporation"), a corporation organized and existing under the General
Corporation Law of the State of Delaware, does hereby
certify:

     That, pursuant to authority
conferred upon by the Board of Directors by the Corporation's Restated
Certificate of Incorporation, as amended, and pursuant to the provisions of
Section 151 of the Delaware Corporation Law, the Board of Directors of the
Corporation has adopted resolutions, a copy of which is attached hereto,
establishing and providing for the issuance of a series of Preferred Stock
designated as Series 4 Class D Convertible Preferred Stock and has established
and fixed the voting powers, designations, preferences and relative
participating, optional and other special rights and qualifications, limitations
and restrictions of such Series 4 Class D Convertible Preferred Stock as set
forth in the attached resolutions.

Dated: June 9,
1997                                                   PERMA-FIX
ENVIRONMENTAL
                                                                                  SERVICES, INC.

                                                                                  By
/s/ Louis
Centofanti                              
                                                                                        Dr.
Louis F.
Centofanti
                                                                                        Chairman of the Board


ATTEST:



/s/ Richard T.
Kelecy                            
Richard
T. Kelecy, Secretary



 

 

 

 

PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the
"Corporation")

RESOLUTION OF THE BOARD OF DIRECTORS

FIXING THE
NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS
ATTACHING TO THE
SERIES 4 CLASS C CONVERTIBLE PREFERRED
STOCK


      WHEREAS, the
Corporation's capital includes preferred stock, par value
$.001 per share ("Preferred Stock"), which Preferred Stock
may be issued in one or more series by resolutions adopted by the directors, and with the directors being entitled by resolution
to fix the number of shares in each series and to designate
the rights, designations, preferences and relative,
participating, optional or other special rights and
privileges, restrictions and conditions attaching to the
shares of each such series;

     WHEREAS, it is in the best
interests of the Corporation for the Board to create a new
series from the Preferred Stock designated as the Series 4
Class D Convertible Preferred Stock, par value $.001 per
share ("Series 4 Class D Preferred
Stock");

     NOW, THEREFORE, BE IT
RESOLVED, that the Series 4 Class D Convertible Preferred Stock, par value
$.001 (the "Series 4 Class D Preferred Stock") of the Corporation shall consist
of two thousand five hundred (2,500) shares and no more and shall be designated
as the Series 4 Class D Convertible Preferred Stock, and the preferences,
rights, privileges, restrictions and conditions attaching to the Series 4 Class
D Preferred Stock shall be as follows:

Part 1 - Voting and Preemptive Rights.

1.1  Voting Rights. Except as otherwise
provided in Part 7 hereof or under the General Corporation
Law of the State of Delaware (the "GCL"), the holders of the
Series 4 Class D Preferred Stock shall have no voting rights
whatsoever. To the extent that under Part 7 hereof or the GCL the vote of the
holders of the Series 4 Class D Preferred Stock, voting separately as a class or
series as applicable, is required to authorize a given action of the
Corporation, the affirmative vote or consent of the holders of at least a
majority of the shares of the Series 4 Class D Preferred Stock represented at a
duly held meeting at which a quorum is present or by written consent of a
majority of the shares of Series 4 Class D Preferred Stock (except as otherwise
may be required under the GCL) shall constitute the approval of such action by
the series. To the extent that under the GCL or Part 7 hereof, the holders of
the Series 4 Class D Preferred Stock are entitled to vote on a matter, each
share of the Series 4 Class D Preferred Stock shall be entitled one (1) vote for
each outstanding share of Series 4 Class D Preferred Stock. Holders of the
Series 4 Class D Preferred Stock shall be entitled to notice of (and copies of
proxy materials and other information sent to stockholders) for all shareholder
meetings or

 

-2-

 

written consents with respect to which they would be entitled to
vote, which notice would be provided pursuant to the Corporation's bylaws and
applicable statutes.

1.2  No Preemptive Rights. The Series 4
Class D Preferred Stock shall not give its holders any
preemptive rights to acquire any other securities issued by
the Corporation at any time in the future.

Part 2 - Liquidation Rights.

2.1  Liquidation. If the Corporation
shall be voluntarily or involuntarily liquidated, dissolved
or wound up at any time when any shares of the Series 4
Class D Preferred Stock shall be outstanding, the holders of
the then outstanding Series 4 Class D Preferred Stock shall
have a preference in distribution of the Corporation's
property available for distribution to the holders of the
Corporation's Common Stock equal to $1,000 consideration per outstanding share of Series 4 Class D Preferred Stock, plus an
amount equal to all unpaid dividends accrued thereon to the date
of payment of such distribution ("Liquidation Preference"),
whether or not declared by the Board.

2.2  Payment of Liquidation Preferences.
Subject to the provisions of Part 6 hereof, all amounts to
be paid as Liquidation Preference to the holders of Series 4
Class D Preferred Stock, as provided in this Part 2, shall
be paid or set apart for payment before the payment or
setting apart for payment of any amount for, or the distribution of any of the Corporation's property to the holders
of the Corporation's Common Stock, whether now or
hereafter authorized, in connection with such liquidation,
dissolution or winding up.

2.3 No Rights After Payment. After the payment to
the holders of the shares of the Series 4 Class D Preferred
Stock of the full Liquidation Preference amounts provided
for in this Part 2, the holders of the Series 4 Class D
Preferred Stock as such shall have no right or claim to any
of the remaining assets of the Corporation.

2.4  Assets Insufficient to Pay Full Liquidation
Preference. In the event that the assets of the Corporation available
for distribution to the holders of shares of the Series 4 Class D Preferred
Stock upon any dissolution, liquidation or winding up of the Corporation,
whether voluntary or involuntary, shall be insufficient to pay in full all
amounts to which such holders are entitled pursuant to this Part 2, no such
distribution shall be made on account of any shares of any other class or series
of Preferred Stock ranking on a parity with the shares of this Series 4 Class D
Preferred Stock upon such dissolution, liquidation or winding up unless
proportionate distributive amounts shall be paid on account of the shares of
this Series 4 Class D Preferred Stock and shares of such other class or series
ranking on a parity with the shares of this Series 4 Class D Preferred Stock,
ratably, in proportion to the full distributable amounts for which holders of
all such parity shares are respectively entitled upon such dissolution,
liquidation or winding up.

 

-3-

 

Part 3 - Dividends.

3.1  The holders of the Series 4 Class D Preferred
Stock are entitled to receive if, when and as declared by the Board out of funds
legally available therefor, cumulative dividends, payable in cash or Common
Stock of the Corporation, par value $.001 per share (the "Common Stock"), or any
combination thereof, at the Corporation's election, at the rate of four percent
(4%) per annum of the Liquidation Value (as defined below) of each issued and
outstanding share of Series 4 Class D Preferred Stock (the "Dividend Rate"). The
Liquidation Value of the Series 4 Class D Preferred Stock shall be $1,000 per
outstanding share of the Series 4 Class D Preferred Stock (the "Liquidation
Value"). The dividend is payable semi-annually within seven (7) business days
after each of December 31 and June 30 of each year, commencing December 31, 1997
(each, a "Dividend Declaration Date"). Dividends shall be paid only with respect
to shares of Series 4 Class D Preferred Stock actually issued and outstanding on
a Dividend Declaration Date and to holders of record of the Series 4 Class D
Preferred Stock as of the Dividend Declaration Date. Dividends shall accrue from
the first day of the semi-annual period in which such dividend may be payable,
except with respect to the first semi-annual dividend which shall accrue from
the date of issuance of the Series 4 Class D Preferred Stock. In the event that
the Corporation elects to pay the accrued dividends due as of a Dividend
Declaration Date on an outstanding share of the Series 4 Class D Preferred Stock
in Common Stock of the Corporation, the holder of such share shall receive that
number of shares of Common Stock of the Corporation equal to the product of (a)
the quotient of (i) the Dividend Rate divided by (ii) the average of the closing
bid quotation of the Corporation's Common Stock as reported on the National
Association of Securities Dealers Automated Quotation system ("NASDAQ"), or the
average closing sale price if listed on a national securities exchange, for the
five (5) trading days immediately prior to the Dividend Declaration Date (the
"Stock Dividend Price"), times (b) a fraction, the numerator of which is the
number of days elapsed during the period for which the dividend is to be paid,
and the denominator of which is 365. Dividends on the Series 4 Class D Preferred
Stock shall be cumulative, and no dividends or other distributions shall be paid
or declared or set aside for payment on the Corporation's Common Stock until all
accrued and unpaid dividends on all outstanding shares of Series 4 Class D
Preferred Stock shall have been paid or declared and set aside for
payment.

Part 4 - Conversion. The holders of the Series 4
Class D Preferred Stock shall have rights to convert the shares of Series 4
Class D Preferred Stock into shares of the Corporation's Common Stock, par value
$.001 per share ("Common Stock"), as follows (the "Conversion
Rights"):

4.1  Right to Convert. The Series 4
Class D Preferred Stock shall be convertible into shares of
Common Stock, as follows: 

     4.1.1  Up to one
thousand two hundred fifty (1,250) shares of Series 4 Class
D Preferred Stock
may 
                be
converted at the Conversion Price (as that term is defined in Section 4.2 below) at any
time 
                on
or after October 5, 1997; and,

 

-4-

 

     4.1.2  Up to an
additional one thousand two hundred fifty (1,250) shares of
Series 4 Class
D 
               Preferred
Stock may be converted at the Conversion Price at any
time on or after November
5,
               1997.

4.2  Conversion Price. Subject to the
terms hereof, as used herein, the term Conversion Price per
outstanding share of Series 4 Class D Preferred Stock shall
be the product of the lesser of (i) the average closing bid
quotation of the Common Stock as reported on the
over-the-counter market, or the closing sale price if listed
on a national securities exchange, for the five (5) trading
days immediately preceding the date of the Conversion Notice
referred to in Section 4.3 below multiplied by eighty
percent (80%) or (ii) U.S. $1.6875. Notwithstanding the
foregoing, the Conversion Price shall not be less than a
minimum of $.75 per share ("Minimum Conversion Price"),
which Minimum Conversion Price shall be eliminated from and
after September 6, 1998. If any of the outstanding shares of
Series 4 Class D Preferred Stock are converted, in whole or
in part, into Common Stock pursuant to the terms of this
Part 4, the number of shares of whole Common Stock to be issued to the holder as a result of such conversion shall be determined by dividing (a) the aggregate Liquidation Value of
the Series 4 Class D Preferred Stock so surrendered for
conversion by (b) the Conversion Price in effect at the date
of the conversion. At the time of conversion of shares of
the Series 4 Class D Preferred Stock, the Corporation shall
pay in cash to the holder thereof an amount equal to all
unpaid and accrued dividends, if any, accrued thereon to the
date of conversion, or, at the Corporation's option, in lieu
of paying cash for the accrued and unpaid dividends, issue
that number of shares of whole Common Stock which is equal
to the quotient of the amount of such unpaid and accrued
dividends to the date of conversion on the shares of Series
4 Class D Preferred Stock so converted divided by the Stock
Dividend Price, as defined in Section 3.1 hereof, in effect
at the date of conversion.

4.3 Mechanics of Conversion. Any holder of the
Series 4 Class D Preferred Stock who wishes to exercise its Conversion Rights
pursuant to Section 4.1 of this Part 4 must, if such shares are not being held
in escrow by the Corporation's attorneys, surrender the certificate therefor at
the principal executive office of the Corporation, and give written notice,
which may be via facsimile transmission, to the Corporation at such office that
it elects to convert the same (the "Conversion Notice"). In the event that the
shares of Series 4 Class D Preferred Stock are being held in escrow by the
Corporation's attorneys, no delivery of the certificates shall be required. No
Conversion Notice with respect to any shares of Series 4 Class D Preferred Stock
can be given prior to the time such shares of Series 4 Class D Preferred Stock
are eligible for conversion in accordance with the provision
of Section 4.1 above, except as provided in Section 4.4. Any such premature
Conversion Notice shall automatically be null and void. The Corporation shall,
within five (5) business days after receipt of an appropriate and timely
Conversion Notice (and certificate, if necessary), issue to such holder of
Series 4 Class D Preferred Stock or its agent a certificate for the number of
shares of Common Stock to which he shall be entitled; it being expressly agreed
that until and unless the holder delivers written notice to the Corporation
to

 

-5-

 

the contrary, all shares of Common Stock issuable upon
conversion of the Series 4 Class D Preferred Stock hereunder are to be delivered
by the Corporation to a party designated in writing by the holder in the
Conversion Notice for the account of the holder and such shall be deemed valid
delivery to the holder of such shares of Common Stock. Such conversion shall be
deemed to have been made only after both the certificate for the shares of
Series 4 Class D Preferred Stock to be converted have been surrendered and the
Conversion Notice is received by the Corporation (or in the event that no
surrender of the Certificate is required, then only upon the receipt by the
Corporation of the Conversion Notice) (the "Conversion Documents"), and the
person or entity whose name is noted on the certificate evidencing such shares
of Common Stock issuable upon such conversion shall be treated for all purposes
as the record holder of such shares of Common Stock at and after such time. In
the event that the Conversion Notice is sent via facsimile transmission, the
Corporation shall be deemed to have received such Conversion Notice on the first
business day on which such facsimile Conversion Notice is actually received. If
the Corporation fails to deliver to the holder or its agent the certificate
representing the shares of Common Stock that the holder is entitled to receive
as a result of such conversion within seven (7) business days after receipt by
the Corporation from the holder of an appropriate and timely Conversion Notice
and certificates pursuant to the terms of this Section 4.3 ("Seven (7) Business
Day Period"), then, upon the written demand of RBB Bank Aktiengesellschaft ("RBB
Bank"), the holder of the Series 4 Class D Preferred Stock, for payment of the
penalty described below in this Section 4.3, which demand must be received by
the Corporation no later than ten (10) calendar days after the expiration of
such Seven (7) Business Day Period, the Corporation shall pay to RBB Bank the
following penalty for each business day after the Seven (7) Business Day Period
until the Corporation delivers to the holder or its agent the certificate
representing the shares of Common Stock that the holder is entitled to receive
as a result of such conversion: business day eight (8) -
U.S. $1,000; business day nine (9) - U.S. $2,000, and each business day
thereafter an amount equal to the penalty due on the
immediately preceding business day times two (2) until the
Corporation delivers to the holder or its agent the
certificate representing the shares of Common Stock that the
holder is entitled to receive as a result of such
conversion.

4.4  Merger or Consolidation. In case of
either (a) any merger or consolidation to which the
Corporation is a party (collectively, the "Merger"), other
than a Merger in which the Corporation is the surviving or
continuing corporation, or (b) any sale or conveyance to
another corporation of all, or substantially all, of the
assets of the Corporation (collectively, the "Sale"), and
such Merger or Sale becomes effective (x) while any shares
of Series 4 Class D Preferred Stock are outstanding and
prior to the date that the Corporation's Registration
Statement covering up to 1,482,000 shares of Common Stock
issuable upon the conversion of the Series 4 Class D
Preferred Stock is declared effective by the U. S.
Securities and Exchange Commission or (y) prior to the end
of the restriction periods in Section 4.1, then, in such event, the Corporation or such successor corporation, as the case may be, shall make appropriate provision so that the holder of each share of Series 4

 

-6-

 

Class D Preferred Stock then outstanding
shall have the right to convert such share of Series 4 Class
D Preferred Stock into the kind and amount of shares of
stock or other securities and property receivable upon such Merger or Sale by a
holder of the number of shares of Common Stock into which
such shares of Series 4 Class D Preferred Stock could have
been converted into immediately prior to such Merger or
Sale, subject to adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided
for in this Part 4.

4.4  Adjustments to Conversion Price for
Stock  Dividends and for Combinations or Subdivisions of
Common Stock. If the Corporation at any time or from time to time while shares
of Series 4 Class D Preferred Stock are issued and outstanding shall declare or
pay, without consideration, any dividend on the Common Stock payable in Common
Stock, or shall effect a subdivision of the outstanding shares of Common Stock
into a greater number of shares of Common Stock (by stock split,
reclassification or otherwise than by payment of a dividend in Common Stock or
in any right to acquire Common Stock), or if the outstanding shares of Common
Stock shall be combined or consolidated, by reclassification or otherwise, into
a lesser number of shares of Common Stock, then the Conversion Price in effect
immediately before such event shall, concurrently with the effectiveness of such
event, be proportionately decreased or increased, as appropriate.

4.5.  Adjustments for Reclassification and
Reorganization. If the Common Stock issuable upon conversion of the
Series 4 Class D Preferred Stock shall be changed into the same or a different
number of shares of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise (other than a subdivision or
combination of shares provided for in Section 4.4 hereof), the Conversion Price
then in effect shall, concurrently with the effectiveness of such reorganization
or reclassification, be proportionately adjusted so that the Series 4 Class D
Preferred Stock shall be convertible into, in lieu of the number of shares of
Common Stock which the holders of Series 4 Class D Preferred Stock would
otherwise have been entitled to receive, a number of shares of such other class
or classes of stock equivalent to the number of shares of Common Stock that
would have been subject to receipt by the holders upon conversion of the Series
4 Class D Preferred Stock immediately before that change.
4.6  Common Stock Duly Issued. All Common Stock
which may be issued upon conversion of Series 4 Class D
Preferred Stock will, upon issuance, be duly issued, fully
paid and nonassessable and free from all taxes, liens, and
charges with respect to the issue thereof.
4.7  Notice of Adjustments. Upon the
occurrence of each adjustment or readjustment of any Conversion Price pursuant
to this Part 4, the Corporation, at its expense, within a reasonable period of
time, shall compute such adjustment or readjustment in accordance with the terms
hereof and prepare and furnish to each holder of Series 4 Class D Preferred
Stock a notice setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment is based.

 

-7-

 

4.8  Issue Taxes. The Corporation shall
pay any and all issue and other taxes that may be payable in
respect of any issue or delivery of shares of Common Stock
on conversion of the Series 4 Class D Preferred Stock
pursuant thereto; provided, however, that the Corporation
shall not be obligated to pay any transfer taxes resulting
from any transfer requested by any holder of Series 4 Class
D Preferred Stock in connection with such
conversion.

4.9  Reservation of Stock Issuable Upon
Conversion. The Corporation shall at all times reserve and keep
available out of its authorized but unissued shares of Common Stock, solely for
the purpose of effecting the conversion of the shares of the Series 4 Class D
Preferred Stock, such number of its shares of Common Stock as shall, from time
to time, be sufficient to effect the conversion of all outstanding shares of the
Series 4 Class D Preferred stock, and, if at any time, the number of authorized
but unissued shares of Common Stock shall not be sufficient to effect the
conversion of all then outstanding shares of the Series 4 Class D Preferred
Stock, the Corporation will take such corporate action as may be necessary to
increase its authorized but unissued shares of Common Stock to such number of
shares as shall be sufficient for such purposes, including, without limitation,
engaging in reasonable efforts to obtain the requisite stockholder approval of
any necessary amendment to its Certificate of Incorporation.

4.10  Fractional Shares. No fractional
shares shall be issued upon the conversion of any share or
shares of Series 4 Class D Preferred Stock. All shares of Common Stock
(including fractions thereof) issuable upon conversion of more than one share of
Series 4 Class D Preferred Stock by a holder thereof shall be aggregated for
purposes of determining whether the conversion would result in the issuance of
any fractional share. If, after the aforementioned aggregation, the conversion
would result in the issuance of a fractional share of Common Stock, such
fractional share shall be rounded up to the nearest whole share.

4.11  Notices. Any notices required by
the provisions of this Part 4 to be given to the holders of
shares of Series 4 Class D Preferred Stock shall be deemed
given if deposited in the United States mail, postage
prepaid, and addressed to each holder of record at his
address appearing on the books of the Corporation.

4.12  Business Day. As used herein, the
term "business day" shall mean any day other than a
Saturday, Sunday or a day when the federal and state banks
located in the State of New York are required or is
permitted to close.

Part 5 - Redemption.

5.1  Redemption at Corporation's Option. Except as
otherwise provided in this Section 5.1, at any time, and
from time to time, after the expiration of one (1) year from
the date of the first issuance of the Series 4 Class
D

 

-8-

 

Preferred Stock, the Corporation may, at its
sole option, but shall not be obligated to, redeem, in whole
or in part, at any time, and from time to time, the then
outstanding Series 4 Class D Preferred Stock at the
following cash redemption prices per share (the "Redemption
Price") if redeemed during the following periods: (a) within
four (4) years from the date of the first issuance of Series
4 Class D Preferred Stock - $1,300 per share, if at any time
during such four (4) year period the average of the closing
bid price of the Common Stock for ten (10) consecutive
trading days shall be in excess of Four U.S. Dollars ($4.00)
per share, and (b) after four (4) years from the date of the
first issuance of Series 4 Class D Preferred Stock - $1,000
per share.

5.3  Mechanics of Redemption. Thirty
(30) days prior to any date stipulated by the Corporation for the redemption of
Series 4 Class D Preferred Stock (the "Redemption Date"), written notice (the
"Redemption Notice") shall be mailed to each holder of record on such notice
date of the Series 4 Class D Preferred Stock. The Redemption Notice shall state:
(i) the Redemption Date of such shares, (ii) the number of Series 4 Class D
Preferred Stock to be redeemed from the holder to whom the Redemption Notice is
addressed, (iii) instructions for surrender to the Corporation, in the manner
and at the place designated, of a share certificate or share certificates
representing the number of Series 4 Class D Preferred Stock to be redeemed from
such holder, and (iv) instructions as to how to specify to the Corporation the
number of Series 4 Class D Preferred Stock to be redeemed as provided in this
Part 5 and, if the Redemption Notice is mailed to the Holder after the first one
hundred eighty (180) days from the date of issuance of the Series 4 Class D
Preferred Stock, the number of shares to be converted into Common Stock as
provided in Part 4 hereof.

5.4  Rights of Conversion Upon
Redemption. If the redemption occurs after the first
one hundred eighty (180) days after the first issuance of Series 4 Class D
Preferred Stock, then, upon receipt of the Redemption Notice, any holder of
Series 4 Class D Preferred Stock shall have the option, at its sole election, to
specify what portion of its Series 4 Class D Preferred Stock called for
redemption in the Redemption Notice shall be redeemed as provided in this Part 5
or converted into Common Stock in the manner provided in Part 4 hereof, except
that, notwithstanding any provision of such Part 4 to the contrary, such holder
shall have the right to convert into Common Stock that number of Series 4 Class
D Preferred Stock called for redemption in the Redemption Notice.

5.5  Surrender of Certificates. On or
before the Redemption Date in respect of any Series 4 Class D Preferred Stock,
each holder of such shares shall surrender the required certificate or
certificates representing such shares to the Corporation in the manner and at
the place designated in the Redemption Notice, and upon the Redemption Date, the
Redemption Price for such shares shall be made payable, in the manner provided
in Section 5.6 hereof, to the order of the person whose name appears on such
certificate or certificates as the owner thereof, and each surrendered share
certificate shall be canceled and retired. If a share certificate is

 

-9-

 

surrendered and all the shares evidenced thereby are not being
redeemed (as described below), the Corporation shall cause the Series 4 Class D
Preferred Stock which are not being redeemed to be registered in the names of
the persons or entity whose names appear as the owners on the respective
surrendered share certificates and deliver such certificate to such
person.

5.6  Payment.  On the
Redemption Date in respect of any Series 4 Class D Preferred
Stock or prior thereto, the Corporation shall deposit with any bank or trust
company having a capital and surplus of at least U. S. $50,000,000, as a trust
fund, a sum equal to the aggregate Redemption Price of all such shares called
from redemption (less the aggregate Redemption Price for those Series 4 Class D
Preferred Stock in respect of which the Corporation has received notice from the
holder thereof of its election to convert Series 4 Class D Preferred Stock into
Common Stock), with irrevocable instructions and authority to the bank or trust
company to pay, on or after the Redemption Date, the Redemption Price to the
respective holders upon the surrender of their share certificates. The deposit
shall constitute full payment for the shares to their holders, and from and
after the date of the deposit the redeemed shares shall be deemed to be no
longer outstanding, and holders thereof shall cease to be shareholders with
respect to such shares and shall have no rights with respect thereto except the
rights to receive from the bank or trust company payments of the Redemption
Price of the shares, without interest, upon surrender of their certificates
thereof. Any funds so deposited and unclaimed at the end of one year following
the Redemption Date shall be released or repaid to the Corporation, after which
the former holders of shares called for redemption shall be entitled to receive
payment of the Redemption Price in respect of their shares only from the
Corporation. 

Part 6 - Parity with Other Shares of Series 4 Class D
Preferred Stock and Priority.

6.1  Rateable Participation. If any
cumulative dividends or return of capital in respect of Series 4 Class D
Preferred Stock are not paid in full, the owners of all series of outstanding
Preferred Stock shall participate rateably in respect of accumulated dividends
and return of capital.

6.2  Ranking.  For purposes of
this resolution, any stock of any class or series of the Corporation shall be
deemed to rank:      

     6.2.1  Prior or senior
to the shares of this Series 4 Class D Preferred Stock either as to dividends
or 
               upon
liquidation, if the holders of such class or classes shall be entitled to the
receipt of
dividends
              
or of amounts distributable upon dissolution, liquidation or winding up of the
Corporation, 
               whether
voluntary or involuntary, as the case may be, in preference or priority to the
holders 
               of
shares of this Series 4 Class D Preferred Stock;

 

-10-

 
     6.2.2  On a
parity with, or equal to, shares of this Series 4 Class D
Preferred Stock, either as to dividends
              
or upon liquidation, whether or not the dividend rates, dividend payment dates,
or redemption
or
               
liquidation prices per share or sinking fund provisions, if any, are different
from those of
this 
                Series
4 Class C Preferred Stock, if the holders of such stock are entitled to the
receipt
of 
                dividends
or of amounts distributable upon dissolution, liquidation or winding up of
the 
                Corporation,
whether voluntary or involuntary, in proportion to their respective dividend
rates
               
or liquidation prices, without preference or priority, one over the other, as
between the holders 
                of
such stock and over the other, as between the holders of such stock and
the holders of
shares 
                of
this Series 4 Class D Preferred Stock; and,
6.2.3 Junior to shares of this Series 4 Class D Preferred Stock,
either as to dividends or upon liquidation, if such class or series shall be
Common Stock or if the holders of shares of this Series 4 Class D Preferred
Stock shall be entitled to receipt of dividends or of amounts distributable upon
dissolution, liquidation or winding up of the Corporation, whether voluntary or
involuntary, as the case may be, in preference or priority to the holders of
shares of such class or series.

Part 7 - Amendment and Reissue.

7.1  Amendment. If any proposed amendment to
the Corporation's Certificate of Incorporation (the
"Articles") would alter or change the powers, preferences or
special rights of the Series 4 Class D Preferred Stock so as to affect such
adversely, then the Corporation must obtain the affirmative vote of such
amendment to the Articles at a duly called and held series
meeting of the holders of the Series 4 Class D Preferred Stock or written consent by the holders of a majority of the Series 4 Class D
Preferred Stock then outstanding. Notwithstanding the above
or the provisions of the GCL, the number of authorized shares of any class or
classes of stock of the Corporation may be increased or
decreased (but not below the number of shares thereof outstanding) by the affirmative vote of the holders of a majority of the stock of the
Corporation entitled to vote thereon, voting together as a
single class, irrespective of the provisions of this Section 7.1 or Section 242
of the GCL.

7.2  Authorized. Any shares of Series 4
Class D Preferred Stock acquired by the Corporation by reason of purchase,
conversion, redemption or otherwise shall be retired and shall become authorized
but unissued shares of Preferred Stock, which may be reissued as part of a new
series of Preferred Stock hereafter created. 


 

-11

CERTIFICATE OF DESIGNATIONS
OF SERIES 5 CLASS
E CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES,
INC.


     Perma-Fix Environmental Services,
Inc. (the "Corporation"), a corporation organized and
existing under the General Corporation Law of the State of
Delaware, does hereby certify:

     That, pursuant to authority
conferred upon by the Board of Directors by the
Corporation's Restated Certificate of Incorporation, as
amended, and pursuant to the provisions of Section 151 of
the Delaware Corporation Law, the Board of Directors of the
Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a
series of Preferred Stock designated as Series 5 Class E
Convertible Preferred Stock and has established and fixed
the voting powers, designations, preferences and
relative participating, optional and other special rights
and qualifications, limitations and restrictions of such
Series 5 Class E Convertible Preferred Stock as set forth in
the attached resolutions.

Dated: July 3,
1997                                         PERMA-FIX
ENVIRONMENTAL
                                                                      SERVICES, INC.


                                                                       By
/s/ Louis
Centofanti                                           
                                                                             Dr. Louis F.
Centofanti
                                                                             Chairman
of the Board
ATTEST:


/s/
Richard T.
Kelecy                             
Richard T. Kelecy, Secretary


 

 

 

PERMA-FIX ENVIRONMENTAL SERVICES,
INC.
(the "Corporation")

RESOLUTION OF THE
BOARD OF DIRECTORS

FIXING THE NUMBER AND DESIGNATING THE RIGHTS,
PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 5 CLASS E
CONVERTIBLE PREFERRED STOCK


     WHEREAS, the Corporation's
capital includes preferred stock, par value $.001 per share
("Preferred Stock"), which Preferred Stock may be issued in
one or more series by resolutions adopted by the directors,
and with the directors being entitled by resolution to fix
the number of shares in each series and to designate the rights, designations, preferences and relative, participating,
optional or other special rights and privileges, and qualifications, limitations or restrictions attaching to the
shares of each such series;

     WHEREAS, it is in the best
interests of the Corporation for the Board to create a new series from the
Preferred Stock designated as the Series 5 Class E Convertible Preferred Stock,
par value $.001 per share ("Series 5 Class E Preferred Stock"); 

     NOW, THEREFORE, BE IT
RESOLVED, that the Series 5 Class E Convertible Preferred Stock, par value
$.001 (the "Series 5 Class E Preferred Stock") of the Corporation shall consist
of three hundred fifty (350) shares and no more and shall be designated as the
Series 5 Class E Convertible Preferred Stock, and the preferences, rights,
privileges, restrictions and conditions attaching to the Series 5 Class E
Preferred Stock shall be as follows:

Part 1 - Voting and Preemptive Rights.

1.1  Voting Rights. Except as otherwise
provided in Section 242(b)(2) of the General Corporation Law
of the State of Delaware (the "GCL"), the holders of the
Series 5 Class E Preferred Stock shall have no voting rights
whatsoever. To the extent that under Section 242(b)(2) of
the GCL the vote of the holders of the Series 5 Class E
Preferred Stock, voting separately as a class or series as
applicable, is required to authorize a given action of the Corporation, the affirmative vote or consent of the holders of at
least a majority of the shares of the Series 5 Class E
Preferred Stock represented at a duly held meeting at which
a quorum is present or by written consent of a majority of
the shares of Series 5 Class E Preferred Stock (except as otherwise may be
required under the GCL) shall constitute the approval of such action by the
series. To the extent that under Section 242(b)(2) of the GCL the holders of the
Series 5 Class E Preferred Stock are entitled to vote on a matter, each share of
the Series 5 Class E Preferred Stock shall be entitled one (1) vote for each
outstanding share of Series 5 Class E Preferred Stock. Holders of the Series 5
Class E Preferred Stock shall be entitled to

 

-2-

 

notice of (and copies of proxy materials and other information
sent to stockholders) for all shareholder meetings or written consents with
respect to which they would be entitled to vote, which notice would be provided
pursuant to the Corporation's bylaws and applicable statutes. If the holders of
the Series 5 Class E Preferred Stock are required to vote under Section
242(b)(2) of the GCL as a result of the number of authorized shares of any such
class or classes of stock being increased or decreased, the number of authorized
shares of any of such class or classes of stock may be increased or decreased
(but not below the number of shares thereof then outstanding) by the affirmative
vote of the holders of a majority of the stock of the Corporation entitled to
vote thereon, irrespective of the provisions of Section 242(b)(2) of the
GCL.

1.2  No Preemptive Rights. The Series 5
Class E Preferred Stock shall not give its holders any
preemptive rights to acquire any other securities issued by
the Corporation at any time in the future.

Part 2 - Liquidation Rights.

2.1  Liquidation. If the Corporation
shall be voluntarily or involuntarily liquidated, dissolved
or wound up at any time when any shares of the Series 5
Class E Preferred Stock shall be outstanding, the holders of
the then outstanding Series 5 Class E Preferred Stock shall
be entitled to receive out of the assets of the Corporation
available for distribution to shareholders an amount equal
to $1,000 consideration per outstanding share of Series 5
Class E Preferred Stock, and no more, plus an amount equal to all unpaid dividends accrued thereon to the date of payment of
such distribution ("Liquidation Preference"), whether or not
declared by the Board of Directors, before any payment shall
be made or any assets distributed to the holders of the
Corporation's Common Stock.

2.2  Payment of Liquidation Preferences.
Subject to the provisions of Part 6 hereof, all amounts to
be paid as Liquidation Preference to the holders of Series 5
Class E Preferred Stock, as provided in this Part 2, shall
be paid or set apart for payment before the payment or
setting apart for payment of any amount for, or the distribution of any of the Corporation's property to the holders
of the Corporation's Common Stock, whether now or
hereafter authorized, in connection with such liquidation,
dissolution or winding up.

2.3  No Rights After Payment. After the
payment to the holders of the shares of the Series 5 Class E
Preferred Stock of the full Liquidation Preference amounts
provided for in this Part 2, the holders of the Series 5
Class E Preferred Stock as such shall have no right or claim
to any of the remaining assets of the Corporation.

2.4  Assets Insufficient to Pay Full Liquidation
Preference. In the event that the assets of the
Corporation available for distribution to the holders of shares of the Series 5
Class E Preferred Stock upon any dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, shall be insufficient to pay in
full all amounts to which such holders are entitled pursuant to this Part 2, no
such distribution shall be made on account of any shares of any other class or
series of Preferred Stock ranking on a parity with the shares of this Series 5
Class E Preferred Stock upon such dissolution, liquidation or winding up unless
proportionate distributive amounts shall be paid on account of the shares of
this Series 5 Class E Preferred Stock and shares of such other class or series
ranking on a parity with the shares of this Series 5 Class E Preferred Stock,
ratably, in proportion to the full distributable amounts for which holders of
all such parity shares are respectively entitled upon such dissolution,
liquidation or winding up.

 

-3-

 

Part 3 - Dividends.

3.1  The holders of the Series 5 Class E Preferred
Stock are entitled to receive if, when and as declared by the Board of Directors
of the Corporation (the "Board") out of funds legally available therefor,
cumulative annual dividends, payable in cash or Common Stock of the Corporation,
par value $.001 per share (the "Common Stock"), or any combination thereof, at
the Corporation's election, at the rate of four percent (4%) per annum of the
Liquidation Value (as defined below) of each issued and outstanding share of
Series 5 Class E Preferred Stock (the "Dividend Rate"). The Liquidation Value of
the Series 5 Class E Preferred Stock shall be $1,000 per outstanding share of
the Series 5 Class E Preferred Stock (the "Liquidation Value"). The dividend is
payable semi-annually within seven (7) business days after each of December 31
and June 30 of each year, commencing December 31, 1997 (each, a "Dividend
Declaration Date"). Dividends shall be paid only with respect to shares of
Series 5 Class E Preferred Stock actually issued and outstanding on a Dividend
Declaration Date and to holders of record of the Series 5 Class E Preferred
Stock as of the Dividend Declaration Date. Dividends shall accrue from the first
day of the semi-annual period in which such dividend may be payable, except with
respect to the first semi-annual dividend which shall accrue from the date of
issuance of the Series 5 Class E Preferred Stock. In the event that the
Corporation elects to pay the accrued dividends due as of a Dividend Declaration
Date on an outstanding share of the Series 5 Class E Preferred Stock in Common
Stock of the Corporation, the holder of such share shall receive that number of
shares of Common Stock of the Corporation equal to the product of (a) the
quotient of (i) the Dividend Rate divided by (ii) the average of the closing bid
quotation of the Corporation's Common Stock as reported on the National
Association of Securities Dealers Automated Quotation system ("NASDAQ"), or the
average closing sale price if listed on a national securities exchange,
for the five (5) trading days immediately prior to the
Dividend Declaration Date (the "Stock Dividend Price"),
times (b) a fraction, the numerator of which is the number
of days elapsed during the period for which the dividend is
to be paid, and the denominator of which is 365. Dividends
on the Series 5 Class E Preferred Stock shall be cumulative,
and no dividends or other distributions shall be paid or
declared or set aside for payment on the Corporation's
Common Stock until all accrued and unpaid dividends on all
outstanding shares of Series 5 Class E Preferred Stock shall
have been paid or declared and set aside for payment.

 

-4-

 

Part 4 - Conversion. The holders of the Series 5
Class E Preferred Stock shall have rights to convert the
shares of Series 5 Class E Preferred Stock into shares of
the Corporation's Common Stock, as follows (the "Conversion
Rights"):

4.1 Right to Convert. The Series 5 Class E
Preferred Stock shall be convertible into shares of Common
Stock, as follows:

      4.1.1  Up to one
hundred seventy-five (175) shares of Series 5 Class E
Preferred Stock may
be 
                converted
at the Conversion Price (as that term is defined in Section 4.2 below) at any
time 
                on
or after November 3, 1997; and,

     4.1.2  Up to an
additional one hundred seventy-five (175) shares of Series 5 Class E Preferred
Stock
                may
be converted at the Conversion Price at any time on or after December 3,
1997.

4.2  Conversion Price. Subject to the
terms hereof, as used herein, the term Conversion Price per
outstanding share of Series 5 Class E Preferred Stock shall
be the product of the lesser of (i) the average closing bid
quotation of the Common Stock as reported on the over-the-counter market, or the
closing sale price if listed on a national securities exchange, for the five (5)
trading days immediately preceding the date of the Conversion Notice referred to
in Section 4.3 below multiplied by eighty percent (80%) or (ii) U.S. $1.6875.
Notwithstanding the foregoing, the Conversion Price shall not be less than a
minimum of $.75 per share ("Minimum Conversion Price"), which Minimum Conversion
Price shall be eliminated from and after September 6, 1998. If any of the
outstanding shares of Series 5 Class E Preferred Stock are converted, in whole
or in part, into Common Stock pursuant to the terms of this Part 4, the number
of shares of whole Common Stock to be issued to the holder as a result of such
conversion shall be determined by dividing (a) the aggregate Liquidation Value
of the Series 5 Class E Preferred Stock so surrendered for conversion by (b) the
Conversion Price in effect at the date of the conversion. At the time of
conversion of shares of the Series 5 Class E Preferred Stock, the Corporation
shall pay in cash to the holder thereof an amount equal to all unpaid and
accrued dividends, if any, accrued thereon to the date of conversion, or, at the
Corporation's option, in lieu of paying cash for the accrued and unpaid
dividends, issue that number of shares of whole Common Stock which is equal to
the quotient of the amount of such unpaid and accrued dividends to the date of
conversion on the shares of Series 5 Class E Preferred Stock so converted
divided by the Stock Dividend Price, as defined in Section 3.1 hereof, in effect
at the date of conversion.

4.3  Mechanics of Conversion. Any holder
of the Series 5 Class E Preferred Stock who wishes to exercise its Conversion
Rights pursuant to Section 4.1 of this Part 4 must surrender the certificate
therefor at the principal executive office of the Corporation, and give written
notice, which may be via facsimile transmission,

 

-5-

 

to the Corporation at such office that it elects to convert the
same (the "Conversion Notice"). No Conversion Notice with respect to any shares
of Series 5 Class E Preferred Stock can be given prior to the time such shares
of Series 5 Class E Preferred Stock are eligible for conversion in accordance
with the provision of Section 4.1 above, except as provided in Section 4.4. Any
such premature Conversion Notice shall automatically be null and void. The
Corporation shall, within seven (7) business days after receipt of an
appropriate and timely Conversion Notice (and certificate, if necessary), issue
to such holder of Series 5 Class E Preferred Stock or its agent a certificate
for the number of shares of Common Stock to which he shall be entitled; it being
expressly agreed that until and unless the holder delivers written notice to the
Corporation to the contrary, all shares of Common Stock issuable upon conversion
of the Series 5 Class E Preferred Stock hereunder are to be delivered by the
Corporation to a party designated in writing by the holder in the Conversion
Notice for the account of the holder and such shall be deemed valid delivery to
the holder of such shares of Common Stock. Such conversion shall be deemed to
have been made only after both the certificate for the shares of Series 5 Class
E Preferred Stock to be converted have been surrendered and the Conversion
Notice is received by the Corporation (the "Conversion Documents"), and the
person or entity whose name is noted on the certificate evidencing such shares
of Common Stock issuable upon such conversion shall be treated for all purposes
as the record holder of such shares of Common Stock at and after such time. In
the event that the Conversion Notice is sent via facsimile transmission, the
Corporation shall be deemed to have received such Conversion Notice on the first
business day on which such facsimile Conversion Notice is actually
received.

4.4  Merger or
Consolidation.  In case of either (a) any merger or
consolidation to which the Corporation is a party (collectively, the "Merger"), other than a Merger in which the
Corporation is the surviving or continuing corporation, or
(b) any sale or conveyance to another corporation of all,
or substantially all, of the assets of the
Corporation (collectively, the "Sale"), and such Merger or
Sale becomes effective (x) while any shares of Series 5
Class E Preferred Stock are outstanding and prior to the
date that the Corporation's Registration Statement covering
up to 200,000 shares of Common Stock issuable upon the
conversion of the Series 5 Class E Preferred Stock is
declared effective by the U. S. Securities and Exchange
Commission or (y) prior to the end of the restriction
periods in Section 4.1, then, in such event, the Corporation
or such successor corporation, as the case may be, shall
make appropriate provision so that the holder of each share
of Series 5 Class E Preferred Stock then outstanding shall
have the right to convert such share of Series 5 Class E
Preferred Stock into the kind and amount of shares of stock
or other securities and property receivable upon such Merger
or Sale by a holder of the number of shares of Common Stock
into which such shares of Series 5 Class E Preferred Stock
could have been converted into immediately prior to such
Merger or Sale, subject to adjustments which shall be as
nearly equivalent as may be practicable to the adjustments
provided for in this Part 4.

 

-6-

 

4.4  Adjustments to Conversion Price for Stock
Dividends and for Combinations or Subdivisions
of Common Stock. If the Corporation at any time or
from time to time while shares of Series 5 Class E Preferred Stock are issued
and outstanding shall declare or pay, without consideration, any dividend on the
Common Stock payable in Common Stock, or shall effect a subdivision of the
outstanding shares of Common Stock into a greater number of shares of Common
Stock (by stock split, reclassification or otherwise than by payment of a
dividend in Common Stock or in any right to acquire Common Stock), or if the
outstanding shares of Common Stock shall be combined or consolidated, by
reclassification or otherwise, into a lesser number of shares of Common Stock,
then the Conversion Price in effect immediately before such event shall,
concurrently with the effectiveness of such event, be proportionately decreased
or increased, as appropriate.
4.5.  Adjustments for Reclassification and
Reorganization. If the Common Stock issuable upon conversion of the
Series 5 Class E Preferred Stock shall be changed into the same or a different
number of shares of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise (other than a subdivision or
combination of shares provided for in Section 4.4 hereof), the Conversion Price
then in effect shall, concurrently with the effectiveness of such reorganization
or reclassification, be proportionately adjusted so that the Series 5 Class E
Preferred Stock shall be convertible into, in lieu of the number of shares of
Common Stock which the holders of Series 5 Class E Preferred Stock would
otherwise have been entitled to receive, a number of shares of such other class
or classes of stock equivalent to the number of shares of Common Stock that
would have been subject to receipt by the holders upon conversion of the Series
5 Class E Preferred Stock immediately before that change.
4.6  Common Stock Duly Issued. All
Common Stock which may be issued upon conversion of Series 5 Class E Preferred
Stock will, upon issuance, be duly issued, fully paid and nonassessable and free
from all taxes, liens, and charges with respect to the issue thereof.

4.7  Notice of Adjustments. Upon the
occurrence of each adjustment or readjustment of any Conversion Price pursuant
to this Part 4, the Corporation, at its expense, within a reasonable period of
time, shall compute such adjustment or readjustment in accordance with the terms
hereof and prepare and furnish to each holder of Series 5 Class E Preferred
Stock a notice setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment is based.

4.8  Issue Taxes. The Corporation shall
pay any and all issue and other taxes that may be payable in respect of any
issue or delivery of shares of Common Stock on conversion of the Series 5 Class
E Preferred Stock pursuant thereto; provided, however, that the Corporation
shall not be obligated to pay any transfer taxes resulting from any transfer
requested by any holder of Series 5 Class E Preferred Stock in connection with
such conversion.

 

-7-

 

4.9  Reservation of Stock Issuable Upon
Conversion. The Corporation shall at all times reserve and keep
available out of its authorized but unissued shares of Common Stock, solely for
the purpose of effecting the conversion of the shares of the Series 5 Class E
Preferred Stock, such number of its shares of Common Stock as shall, from time
to time, be sufficient to effect the conversion of all outstanding shares of the
Series 5 Class E Preferred stock, and, if at any time, the number of authorized
but unissued shares of Common Stock shall not be sufficient to effect the
conversion of all then outstanding shares of the Series 5 Class E Preferred
Stock, the Corporation will take such corporate action as may be necessary to
increase its authorized but unissued shares of Common Stock to such number of
shares as shall be sufficient for such purposes, including, without limitation,
engaging in reasonable efforts to obtain the requisite stockholder approval of
any necessary amendment to its Certificate of Incorporation.

4.10  Fractional Shares. No fractional
shares shall be issued upon the conversion of any share or
shares of Series 5 Class E Preferred Stock. All shares of
Common Stock (including fractions thereof) issuable upon
conversion of more than one share of Series 5 Class E
Preferred Stock by a holder thereof shall be aggregated for
purposes of determining whether the conversion would result
in the issuance of any fractional share. If, after the
aforementioned aggregation, the conversion would result in
the issuance of a fractional share of Common Stock, such
fractional share shall be rounded up to the nearest whole
share.

4.11 Notices. Any notices required by the
provisions of this Part 4 to be given to the holders of
shares of Series 5 Class E Preferred Stock shall be deemed
given if deposited in the United States mail, postage
prepaid, and addressed to each holder of record at his
address appearing on the books of the Corporation.

4.12  Business Day. As used herein, the
term "business day" shall mean any day other than a
Saturday, Sunday or a day when the federal and state banks
located in the State of New York are required or is
permitted to close.

Part 5 - Redemption.

5.1  Redemption at Corporation's Option.
Except as otherwise provided in this Section 5.1, at any time, and from time to
time, after the expiration of one (1) year from the date of the first issuance
of the Series 5 Class E Preferred Stock, the Corporation may, at its sole
option, but shall not be obligated to, redeem, in whole or in part, at any time,
and from time to time, the then outstanding Series 5 Class E Preferred Stock at
the following cash redemption prices per share (the "Redemption Price") if
redeemed during the following periods: (a) within four (4) years from the date
of the first issuance of Series 5 Class E Preferred Stock - $1,300 per share, if
at any time during such four (4) year period the average of the closing bid
price of the Common Stock for ten (10) consecutive trading days shall be in
excess of Four U.S. Dollars ($4.00) per share, and (b) after four (4) years from
the date of the first issuance of Series 5 Class E Preferred Stock - $1,000 per
share.

 

-8-

 

5.3  Mechanics of Redemption. Thirty
(30) days prior to any date stipulated by the Corporation
for the redemption of Series 5 Class E Preferred Stock (the
"Redemption Date"), written notice (the "Redemption Notice")
shall be mailed to each holder of record on such notice date
of the Series 5 Class E Preferred Stock. The Redemption
Notice shall state: (i) the Redemption Date of such shares, (ii) the number of
Series 5 Class E Preferred Stock to be redeemed from the holder to whom the
Redemption Notice is addressed, (iii) instructions for surrender to the
Corporation, in the manner and at the place designated, of a share certificate
or share certificates representing the number of Series 5 Class E Preferred
Stock to be redeemed from such holder, and (iv) instructions as to how to
specify to the Corporation the number of Series 5 Class E Preferred Stock to be
redeemed as provided in this Part 5.

5.4  Rights of Conversion Upon
Redemption. If the redemption occurs after the first one hundred eighty
(180) days after the first issuance of Series 5 Class E Preferred Stock, then,
upon receipt of the Redemption Notice, any holder of Series 5 Class E Preferred
Stock shall have the option, at its sole election, to specify what portion of
its Series 5 Class E Preferred Stock called for redemption in the Redemption
Notice shall be redeemed as provided in this Part 5 or converted into Common
Stock in the manner provided in Part 4 hereof.

5.5 Surrender of Certificates. On or before the
Redemption Date in respect of any Series 5 Class E Preferred
Stock, each holder of such shares shall surrender the required certificate or
certificates representing such shares to the Corporation in the manner and at
the place designated in the Redemption Notice, and upon the Redemption Date, the
Redemption Price for such shares shall be made payable, in the manner provided
in Section 5.6 hereof, to the order of the person whose name appears on such
certificate or certificates as the owner thereof. If a share certificate is
surrendered and all the shares evidenced thereby are not being redeemed (as
described below), the Corporation shall cause the Series 5 Class E Preferred
Stock which are not being redeemed to be registered in the names of the persons
or entity whose names appear as the owners on the respective surrendered share
certificates and deliver such certificate to such person.

5.6  Payment. On the Redemption Date in
respect of any Series 5 Class E Preferred Stock or prior
thereto, the Corporation shall deposit with any bank or trust company having a
capital and surplus of at least U. S. $50,000,000, as a trust fund, a sum equal
to the aggregate Redemption Price of all such shares called from redemption
(less the aggregate Redemption Price for those Series 5 Class E Preferred Stock
in respect of which the Corporation has received notice from the holder thereof
of its election to convert Series 5 Class E

 

-9-

 

Preferred Stock into Common Stock), with irrevocable
instructions and authority to the bank or trust company to pay, on or after the
Redemption Date, the Redemption Price to the respective holders upon the
surrender of their share certificates. The deposit shall constitute full payment
for the shares to their holders, and from and after the date of the deposit the
redeemed shares shall be deemed to be no longer outstanding, and holders thereof
shall cease to be shareholders with respect to such shares and shall have no
rights with respect thereto except the rights to receive from the bank or trust
company payments of the Redemption Price of the shares, without interest, upon
surrender of their certificates thereof. Any funds so deposited and unclaimed at
the end of one year following the Redemption Date shall be released or repaid to
the Corporation, after which the former holders of shares called for redemption
shall be entitled to receive payment of the Redemption Price in respect of their
shares only from the Corporation.

Part 6 - Parity with Other Shares of Series 5 Class E
Preferred Stock and Priority.

6.1  Rateable Participation. If any
cumulative dividends or return of capital in respect of Series 5 Class E
Preferred Stock are not paid in full, the owners of all series of outstanding
Preferred Stock shall participate rateably in respect of accumulated dividends
and return of capital.

6.2  Ranking. For purposes of this
resolution, any stock of any class or series of the Corporation shall be deemed
to rank:

     6.2.1  Prior or senior
to the shares of this Series 5 Class E Preferred Stock either as to
dividends
               or
upon liquidation, if the holders of such class or classes
shall be entitled to the receipt
of 
               dividends
or of amounts distributable upon dissolution, liquidation or winding up of
the 
               Corporation,
whether voluntary or involuntary, as the case may be, in preference or
priority 
               to
the holders of shares of this Series 5 Class E Preferred Stock;

     6.2.2  On a parity with,
or equal to, shares of this Series 5 Class E Preferred Stock, either as
to 
               dividends
or upon liquidation, whether or not the dividend rates, dividend payment
dates, 
               or
redemption or liquidation prices per share or sinking fund provisions, if any,
are
different 
               from
those of this Series 5 Class E Preferred Stock, if the holders of such stock are
entitled 
               to
the receipt of dividends or of amounts distributable upon dissolution,
liquidation or
winding 
               up
of the Corporation, whether voluntary or involuntary, in proportion to their
respective 
               dividend
rates or liquidation prices, without preference or priority, one over the other,
as 
               between
the holders of such stock and over the other, as between the holders of such
stock 
               and
the holders of shares of this Series 5 Class E Preferred Stock; and,

 

-10-

 

     6.2.3  Junior to shares
of this Series 5 Class E Preferred Stock, either as to dividends or
upon 
               liquidation,
if such class or series shall be Common Stock or if the holders of shares of
this 
               Series
5 Class E Preferred Stock shall be entitled to receipt of dividends or of
amounts 
               distributable
upon dissolution, liquidation or winding up of the Corporation, whether
voluntary
               or
involuntary, as the case may be, in preference or priority to the holders of
shares of
such 
               class
or series.

Part 7 - Reissue.

7.1  Authorized. Any shares of Series 5
Class E Preferred Stock acquired by the Corporation by reason of purchase,
conversion, redemption or otherwise shall be retired and shall become authorized
but unissued shares of Preferred Stock, which may be reissued as part of a new
series of Preferred Stock hereafter created.

 

 

 

 

 

 

 

-11-

 

CERTIFICATE OF DESIGNATIONS
OF SERIES 6 CLASS
F CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES,
INC.


     Perma-Fix Environmental Services,
Inc. (the "Corporation"), a corporation organized and
existing under the General Corporation Law of the State of
Delaware, does hereby certify:

     That, pursuant to authority
conferred upon by the Board of Directors by the
Corporation's Restated Certificate of Incorporation, as
amended, and pursuant to the provisions of Section 151 of
the Delaware Corporation Law, the Board of Directors of the
Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a
series of Preferred Stock designated as Series 6 Class F
Convertible Preferred Stock and has established and fixed
the voting powers, designations, preferences and
relative participating, optional and other special rights
and qualifications, limitations and restrictions of such
Series 6 Class F Convertible Preferred Stock as set forth in
the attached resolutions.

Dated: November 12,
1997

                                                                                     PERMA-FIX
ENVIRONMENTAL
                                                                                     SERVICES,
INC.


                                                                                     By /s/ Louis
Centofanti                          
                                                                                           Dr. Louis F. Centofanti
                                                                                           Chairman
of the Board

ATTEST:


/s/ Richard T.
Kelecy                            
Richard
T. Kelecy, Secretary



 

PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the
"Corporation")

RESOLUTION OF THE BOARD OF DIRECTORS

FIXING THE
NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS
ATTACHING TO THE
SERIES 6 CLASS F CONVERTIBLE PREFERRED
STOCK


     WHEREAS, the Corporation's
capital includes preferred stock, par value $.001 per share
("Preferred Stock"), which Preferred Stock may be issued in
one or more series by resolutions adopted by the directors,
and with the directors being entitled by resolution to fix
the number of shares in each series and to designate the rights, designations, preferences and relative, participating,
optional or other special rights and privileges, restrictions
and conditions attaching to the shares of each such
series;
     WHEREAS, it
is in the best interests of the Corporation for the Board to
create a new series from the Preferred Stock designated as
the Series 6 Class F Convertible Preferred Stock, par value
$.001 per share (the "Series 6 Class F Preferred
Stock");

     NOW,
THEREFORE, BE IT RESOLVED, that the Series 6 Class F Preferred Stock shall consist of two thousand five hundred (2,500)
shares and no more and shall be designated as the Series 6 Class
F Convertible Preferred Stock, and the preferences,
rights, privileges, restrictions and conditions attaching to
the Series 6 Class F Preferred Stock shall be as
follows:
Part 1 - Voting and Preemptive Rights.

1.1  Voting Rights.  Except as
otherwise provided in Part 7 hereof or under the General
Corporation Law of the State of Delaware (the "GCL"), the
holders of the Series 6 Class F Preferred Stock shall have
no voting rights whatsoever. To the extent that under Part 7
hereof or the GCL the vote of the holders of the Series 6
Class F Preferred Stock, voting separately as a class or
series as applicable, is required to authorize a given
action of the Corporation, the affirmative vote or consent
of the holders of at least a majority of the shares of
the Series 6 Class F Preferred Stock represented at a
duly held meeting at which a quorum is present or by
written consent of a majority of the shares of Series 6
Class F Preferred Stock (except as otherwise may be
required under the GCL) shall constitute the approval of
such action by the series. To the extent that under the GCL or Part 7 hereof, the holders of the Series 6 Class F Preferred Stock are entitled to vote on a matter, each share of the Series 6 Class F Preferred Stock shall be entitled one (1) vote for each outstanding share of Series 6 Class F Preferred Stock. Holders of the Series 6 Class F Preferred Stock shall be entitled to notice of (and copies of proxy materials and other information sent to stockholders) for all shareholder meetings or

 

-1-

 

written consents with respect to which they would be entitled
to vote, which notice would be provided pursuant to
the Corporation's bylaws and applicable statutes.

1.2  No Preemptive Rights. The Series 6
Class F Preferred Stock shall not give its holders any
preemptive rights to acquire any other securities issued by
the Corporation at any time in the future.

Part 2 - Liquidation Rights.

2.1  Liquidation.  If the
Corporation shall be voluntarily or involuntarily
liquidated, dissolved or wound up at any time when any
shares of the Series 6 Class F Preferred Stock shall be
outstanding, the holders of the then outstanding Series 6
Class F Preferred Stock shall have a preference in
distribution of the Corporation's property available for
distribution to the holders of the Corporation's Common
Stock equal to $1,000 consideration per outstanding share of
Series 6 Class F Preferred Stock, plus an amount equal to
all unpaid dividends accrued thereon to the date of payment
of such distribution ("Liquidation Preference"), whether or
not declared by the Board.

2.2  Payment of Liquidation Preferences.
Subject to the provisions of Part 6 hereof, all amounts to be paid as
Liquidation Preference to the holders of Series 6 Class F Preferred Stock, as
provided in this Part 2, shall be paid or set apart for payment before the
payment or setting apart for payment of any amount for, or the distribution of
any of the Corporation's property to the holders of the Corporation's Common
Stock, whether now or hereafter authorized, in connection with such liquidation,
dissolution or winding up.

2.3  No Rights After Payment. After the
payment to the holders of the shares of the Series 6 Class F Preferred Stock of
the full Liquidation Preference amounts provided for in this Part 2, the holders
of the Series 6 Class F Preferred Stock as such shall have no right or claim to
any of the remaining assets of the Corporation.

2.4  Assets Insufficient to Pay Full Liquidation
Preference. In the event that the assets of the Corporation available
for distribution to the holders of shares of the Series 6 Class F Preferred
Stock upon any dissolution, liquidation or winding up of the Corporation,
whether voluntary or involuntary, shall be insufficient to pay in full all
amounts to which such holders are entitled pursuant to this Part 2, no such
distribution shall be made on account of any shares of any other class or series
of Preferred Stock ranking on a parity with the shares of this Series 6 Class F
Preferred Stock upon such dissolution, liquidation or winding up unless
proportionate distributive amounts shall be paid on account of the shares of
this Series 6 Class F Preferred Stock and shares of such other class or series
ranking on a parity with the shares of this Series 6 Class F Preferred
Stock,

 

-2-

 

ratably, in proportion to the full distributable amounts for
which holders of all such parity shares are respectively entitled upon such
dissolution, liquidation or winding up.

Part 3 - Dividends. The holders of the Series 6
Class F Preferred Stock are entitled to receive if, when and
as declared by the Board out of funds legally
available therefor, cumulative dividends, payable in cash or
Common Stock of the Corporation, par value $.001 per share
(the "Common Stock"), or any combination thereof, at
the Corporation's election, at the rate of four percent
(4%) per annum of the Liquidation Value (as defined below)
of each issued and outstanding share of Series 6 Class
F Preferred Stock (the "Dividend Rate"). The
Liquidation Value of the Series 6 Class F Preferred Stock
shall be $1,000 per outstanding share of the Series 6 Class
F Preferred Stock (the "Liquidation Value"). The
dividend is payable semi-annually within seven (7) business
days after each of December 31 and June 30 of each
year, commencing December 31, 1997 (each, a "Dividend
Declaration Date"). Dividends shall be paid only with respect to shares of Series 6 Class F Preferred Stock actually issued and outstanding on a Dividend Declaration Date and to holders of record of the Series 6 Class F Preferred Stock as of the Dividend Declaration Date. Dividends shall accrue from the first day of the semi-annual period in
which such dividend may be payable, except with respect to
the first semi-annual dividend which shall accrue from
September 16, 1997. In the event that the Corporation elects
to pay the accrued dividends due as of a Dividend
Declaration Date on an outstanding share of the Series 6
Class F Preferred Stock in Common Stock of the Corporation,
the holder of such share shall receive that number of shares
of Common Stock of the Corporation equal to the product of
(a) the quotient of (i) the Dividend Rate divided by (ii)
the average of the closing bid quotation of the
Corporation's Common Stock as reported on the National
Association of Securities Dealers Automated Quotation system
("NASDAQ"), or the average closing sale price if listed on a
national securities exchange, for the five (5) trading
days immediately prior to the Dividend Declaration Date
(the "Stock Dividend Price"), times (b) a fraction,
the numerator of which is the number of days elapsed
during the period for which the dividend is to be paid, and
the denominator of which is 365. Dividends on the Series
6 Class F Preferred Stock shall be cumulative, and no
dividends or other distributions shall be paid or declared or set aside for payment on the Corporation's Common Stock until all accrued and unpaid dividends on all outstanding shares of Series 6 Class F Preferred Stock shall have been paid or declared and set aside for payment.

Part 4 - Conversion. The holders of the Series 6
Class F Preferred Stock shall have rights to convert the
shares of Series 6 Class F Preferred Stock into shares of the Corporation's
Common Stock, par value $.001 per share ("Common Stock"), as follows (the
"Conversion Rights"):

4.1  Right to Convert. The Series 6
Class F Preferred Stock shall be convertible into shares of Common Stock, as
follows: 

-3-

     4.1.1  Up to one
thousand two hundred fifty (1,250) shares of Series 6 Class
F Preferred Stock may 
                be
converted at the Conversion Price (as that term is defined
in Section 4.2 below) at any time 
                on
or after October 5, 1997; and, 

     4.1.2  Up to an
additional one thousand two hundred fifty (1,250) shares of Series 6 Class F
Preferred
               Stock
may be converted at the Conversion Price at any time on or after November 5,
1997.

4.2  Conversion Price. Subject to the
terms hereof, as used herein, the Conversion Price per outstanding share of
Series 6 Class F Preferred Stock shall be $1.8125, except that, in the event the
average closing bid price per share of the Common Stock for 20 of any 30
consecutive trading days after March 1, 1998 shall be less than $2.50 as
reported on the over-the-counter market, or the closing sale price if listed on
a national securities exchange, the Conversion Price shall thereafter be the
product of the lesser of (i) the average closing bid quotation of the Common
Stock as reported on the over-the-counter market, or the closing sale price if
listed on a national securities exchange, for the five trading days immediately
preceding the date of the Conversion Notice referred to in Section 4.3 below
multiplied by eighty percent (80%) or (ii) $1.8125. Notwithstanding the
foregoing, the Conversion Price shall not be less than a minimum of $.75 per
share ("Minimum Conversion Price"), which Minimum Conversion Price shall be
eliminated from and after September 6, 1998. If any of the outstanding shares of
Series 6 Class F Preferred Stock are converted, in whole or in part, into Common
Stock pursuant to the terms of this Part 4, the number of shares of whole Common
Stock to be issued to the holder as a result of such conversion shall be
determined by dividing (a) the aggregate Liquidation Value of the Series 6 Class
F Preferred Stock so surrendered for conversion by (b) the Conversion Price as
of such conversion. At the time of conversion of shares of the Series 6 Class F
Preferred Stock, the Corporation shall pay in cash to the holder thereof an
amount equal to all unpaid and accrued dividends, if any, accrued thereon to the
date of conversion, or, at the Corporation's option, in lieu of paying cash for
the accrued and unpaid dividends, issue that number of whole shares of Common
Stock which is equal to the quotient of the amount of such unpaid and accrued
dividends to the date of conversion on the shares of Series 6 Class F Preferred
Stock so converted divided by the Stock Dividend Price, as defined in Part 3
hereof, in effect at the date of conversion.

4.3  Mechanics of Conversion. Any holder
of the Series 6 Class F Preferred Stock who wishes to exercise its Conversion
Rights pursuant to Section 4.1 of this Part 4 must, if such shares are not being
held in escrow by the Corporation's attorneys, surrender the certificate
therefor at the principal executive office of the Corporation, and give written
notice, which may be via facsimile transmission, to the Corporation at such
office that it elects to convert the same (the "Conversion Notice"). In the
event that the shares of Series 6 Class F

 

-4-

 

Preferred Stock are being held in escrow by the Corporation's
attorneys, no delivery of the certificates shall be required. No Conversion
Notice with respect to any shares of Series 6 Class F Preferred Stock can be
given prior to the time such shares of Series 6 Class F Preferred Stock are
eligible for conversion in accordance with the provision of Section 4.1 above,
except as provided in Section 4.4. Any such premature Conversion Notice shall
automatically be null and void. The Corporation shall, within five (5) business
days after receipt of an appropriate and timely Conversion Notice (and
certificate, if necessary), issue to such holder of Series 6 Class F Preferred
Stock or its agent a certificate for the number of shares of Common Stock to
which he shall be entitled; it being expressly agreed that until and unless the
holder delivers written notice to the Corporation to the contrary, all shares of
Common Stock issuable upon conversion of the Series 6 Class F Preferred Stock
hereunder are to be delivered by the Corporation to a party designated in
writing by the holder in the Conversion Notice for the account of the holder and
such shall be deemed valid delivery to the holder of such shares of Common
Stock. Such conversion shall be deemed to have been made only after both the
certificate for the shares of Series 6 Class F Preferred Stock to be converted
have been surrendered and the Conversion Notice is received by the Corporation
(or in the event that no surrender of the Certificate is required, then only
upon the receipt by the Corporation of the Conversion Notice) (the "Conversion
Documents"), and the person or entity whose name is noted on the certificate
evidencing such shares of Common Stock issuable upon such conversion shall be
treated for all purposes as the record holder of such shares of Common Stock at
and after such time. In the event that the Conversion Notice is sent via
facsimile transmission, the Corporation shall be deemed to have received such
Conversion Notice on the first business day on which such facsimile Conversion
Notice is actually received. If the Corporation fails to deliver to the holder
or its agent the certificate representing the shares of Common Stock that the
holder is entitled to receive as a result of such conversion within seven (7)
business days after receipt by the Corporation from the holder of an appropriate
and timely Conversion Notice and certificates pursuant to the terms of this
Section 4.3 ("Seven (7) Business Day Period"), then, upon the written demand of
RBB Bank Aktiengesellschaft ("RBB Bank"), the holder of the Series 6 Class F
Preferred Stock, for payment of the penalty described below in this Section 4.3,
which demand must be received by the Corporation no later than ten (10) calendar
days after the expiration of such Seven (7) Business Day Period, the Corporation
shall pay to RBB Bank the following penalty for each business day after the
Seven (7) Business Day Period until the Corporation delivers to the holder or
its agent the certificate representing the shares of Common Stock that the
holder is entitled to receive as a result of such conversion: business day eight
(8) - U.S. $1,000; business day nine (9) - U.S. $2,000, and each business day
thereafter an amount equal to the penalty due on the immediately preceding
business day times two (2) until the Corporation delivers to the holder or its
agent the certificate representing the shares of Common Stock that the holder is
entitled to receive as a result of such conversion.

 

-5-

 

4.4  Merger or
Consolidation.  In case of either (a) any merger or
consolidation to which the Corporation is a party (collectively, the "Merger"),
other than a Merger in which the Corporation is the surviving or continuing
corporation, or (b) any sale or conveyance to another corporation of all, or
substantially all, of the assets of the Corporation (collectively, the "Sale"),
and such Merger or Sale becomes effective (x) while any shares of Series 6 Class
F Preferred Stock are outstanding and prior to the date that the Corporation's
Registration Statement covering up to 1,379,500 shares of Common Stock issuable
upon the conversion of the Series 6 Class F Preferred Stock is declared
effective by the U. S. Securities and Exchange Commission or (y) prior to the
end of the restriction periods in Section 4.1, then, in such event, the
Corporation or such successor corporation, as the case may be, shall make
appropriate provision so that the holder of each share of Series 6 Class F
Preferred Stock then outstanding shall have the right to convert such share of
Series 6 Class F Preferred Stock into the kind and amount of shares of stock or
other securities and property receivable upon such Merger or Sale by a holder of
the number of shares of Common Stock into which such shares of Series 6 Class F
Preferred Stock could have been converted into immediately prior to such Merger
or Sale, subject to adjustments which shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Part 4.

4.5  Adjustments to Conversion Price for Stock
Dividends and for Combinations or Subdivisions of Common
Stock.  If the Corporation at any time or from time to time while
shares of Series 6 Class F Preferred Stock are issued and outstanding shall
declare or pay, without consideration any dividend on the Common Stock payable
in Common Stock, or shall effect a subdivision of the outstanding shares of
Common Stock into a greater number of shares of Common Stock (by stock split,
reclassification or otherwise than by payment of a dividend in Common Stock or
in any right to acquire Common Stock), or if the outstanding shares of Common
Stock shall be combined or consolidated, by reclassification or otherwise, into
a lesser number of shares of Common Stock, then the Conversion Price in effect
immediately before such event shall, concurrently with the effectiveness of such
event, be proportionately decreased or increased, as appropriate.

4.6  Adjustments for Reclassification and
Reorganization. If the Common Stock issuable upon conversion of the
Series 6 Class F Preferred Stock shall be changed into the same or a different
number of shares of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise (other than a subdivision or
combination of shares provided for in Section 4.4 hereof), the Conversion Price
shall, concurrently with the effectiveness of such reorganization or
reclassification, be proportionately adjusted so that the Series 6 Class F
Preferred Stock shall be convertible into, in lieu of the number of shares of
Common Stock which the holders of Series 6 Class F Preferred Stock would
otherwise have been entitled to

 

-6-

 

receive, a number of shares of such other class or classes of
stock equivalent to the number of shares of Common Stock that would have been
subject to receipt by the holders upon conversion of the Series 6 Class F
Preferred Stock immediately before that change.

4.7  Common Stock Duly Issued. All
Common Stock which may be issued upon conversion of Series 6
Class F Preferred Stock will, upon issuance, be duly
issued, fully paid and nonassessable and free from all
taxes, liens, and charges with respect to the issue
thereof.

4.8  Notice of Adjustments. Upon the
occurrence of each adjustment or readjustment of any Conversion Price pursuant
to this Part 4, the Corporation, at its expense, within a reasonable period of
time, shall compute such adjustment or readjustment in accordance with the terms
hereof and prepare and furnish to each holder of Series 6 Class F Preferred
Stock a notice setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment is based.

4.9 Issue Taxes. The Corporation shall pay any and
all issue and other taxes that may be payable in respect
of any issue or delivery of shares of Common Stock on
conversion of the Series 6 Class F Preferred Stock pursuant thereto; provided, however, that the Corporation shall not be obligated to pay any transfer taxes resulting from any transfer requested by any holder of Series 6 Class F Preferred Stock in connection with such conversion.

4.10 Reservation of Stock Issuable Upon
Conversion. The Corporation shall at all times
reserve and keep available out of its authorized but
unissued shares of Common Stock, solely for the purpose of
effecting the conversion of the shares of the Series 6 Class
F Preferred Stock, such number of its shares of Common Stock
as shall, from time to time, be sufficient to effect the
conversion of all outstanding shares of the Series 6 Class F
Preferred stock, and, if at any time, the number of
authorized but unissued shares of Common Stock shall not be
sufficient to effect the conversion of all then outstanding
shares of the Series 6 Class F Preferred Stock, the
Corporation will take such corporate action as may be
necessary to increase its authorized but unissued shares of
Common Stock to such number of shares as shall be sufficient
for such purposes, including, without limitation, engaging
in reasonable efforts to obtain the requisite
stockholder approval of any necessary amendment to its
Certificate of Incorporation.

4.11  Fractional Shares. No fractional
shares shall be issued upon the conversion of any share or
shares of Series 6 Class F Preferred Stock. All shares of
Common Stock (including fractions thereof) issuable
upon conversion of more than one share of Series 6 Class
F Preferred Stock by a holder thereof shall be
aggregated for purposes of determining whether the
conversion would result in the issuance of any fractional
share. If, after

 

-7-

 

the aforementioned aggregation, the conversion would result in the issuance of a fractional share of Common Stock, such fractional share shall be rounded up to the nearest whole share.

4.12  Notices. Any notices required by
the provisions of this Part 4 to be given to the holders of
shares of Series 6 Class F Preferred Stock shall be deemed
given if deposited in the United States mail, postage
prepaid, and addressed to each holder of record at his
address appearing on the books of the
Corporation.

4.13  Business Day. As used herein, the
term "business day" shall mean any day other than a
Saturday, Sunday or a day when the federal and state banks
located in the State of New York are required or is
permitted to close.

Part 5 - Redemption.

5.1  Redemption at Corporation's Option.
Except as otherwise provided in this Section 5.1, at any time, and from time to
time, after the expiration of one (1) year from June 9, 1997, the Corporation
may, at its sole option, but shall not be obligated to, redeem, in whole or in
part, at any time, and from time to time, the then outstanding Series 6 Class F
Preferred Stock at the following cash redemption prices per share (the
"Redemption Price") if redeemed during the following periods: (a) within four
years from June 9, 1997 - $1,300 per share, if at any time during such four year
period the average of the closing bid price of the Common Stock for ten
consecutive trading days shall be in excess of Four Dollars ($4.00) per share,
and (b) after four years from June 9, 1997 - $1,000 per share.

5.2  Mechanics of Redemption. Thirty
days prior to any date stipulated by the Corporation for the redemption of
Series 6 Class F Preferred Stock (the "Redemption Date"), written notice (the
"Redemption Notice") shall be mailed to each holder of record on such notice
date of the Series 6 Class F Preferred Stock. The Redemption Notice shall state:
(i) the Redemption Date of such shares, (ii) the number of Series 6 Class F
Preferred Stock to be redeemed from the holder to whom the Redemption Notice is
addressed, (iii) instructions for surrender to the Corporation, in the manner
and at the place designated, of a share certificate or share certificates
representing the number of Series 6 Class F Preferred Stock to be redeemed from
such holder, and (iv) instructions as to how to specify to the Corporation the
number of Series 6 Class F Preferred Stock to be redeemed as provided in this
Part 5 and, if the Redemption Notice is mailed to the Holder after the first 180
days from the date of issuance of the Series 6 Class F Preferred Stock, the
number of shares to be converted into Common Stock as provided in Part 4
hereof.

5.3  Rights of Conversion Upon
Redemption.  If the redemption occurs after the first 180 days
after the first issuance of Series 6 Class F Preferred Stock, then, upon receipt
of the Redemption Notice, any holder of

 

-8-

 

Series 6 Class F Preferred Stock shall have the option, at its
sole election, to specify what portion of its Series 6 Class F Preferred Stock
called for redemption in the Redemption Notice shall be redeemed as provided in
this Part 5 or converted into Common Stock in the manner provided in Part 4
hereof, except that, notwithstanding any provision of such Part 4 to the
contrary, such holder shall have the right to convert into Common Stock that
number of Series 6 Class F Preferred Stock called for redemption in the
Redemption Notice.

5.4  Surrender of
Certificates.  On or before the Redemption Date in respect of
any Series 6 Class F Preferred Stock, each holder of such shares shall surrender
the required certificate or certificates representing such shares to the
Corporation in the manner and at the place designated in the Redemption Notice,
and upon the Redemption Date, the Redemption Price for such shares shall be made
payable, in the manner provided in Section 5.6 hereof, to the order of the
person whose name appears on such certificate or certificates as the owner
thereof, and each surrendered share certificate shall be canceled and retired.
If a share certificate is surrendered and all the shares evidenced thereby are
not being redeemed (as described below), the Corporation shall cause the Series
6 Class F Preferred Stock which are not being redeemed to be registered in the
names of the persons or entity whose names appear as the owners on the
respective surrendered share certificates and deliver such certificate to such
person.

5.5  Payment. On the Redemption Date in
respect of any Series 6 Class F Preferred Stock or prior thereto, the
Corporation shall deposit with any bank or trust company having a capital and
surplus of at least $50,000,000, as a trust fund, a sum equal to the aggregate
Redemption Price of all such shares called from redemption (less the aggregate
Redemption Price for those Series 6 Class F Preferred Stock in respect of which
the Corporation has received notice from the holder thereof of its election to
convert Series 6 Class F Preferred Stock into Common Stock), with irrevocable
instructions and authority to the bank or trust company to pay, on or after the
Redemption Date, the Redemption Price to the respective holders upon the
surrender of their share certificates. The deposit shall constitute full payment
for the shares to their holders, and from and after the date of the deposit the
redeemed shares shall be deemed to be no longer outstanding, and holders thereof
shall cease to be shareholders with respect to such shares and shall have no
rights with respect thereto except the rights to receive from the bank or trust
company payments of the Redemption Price of the shares, without interest, upon
surrender of their certificates thereof. Any funds so deposited and unclaimed at
the end of one year following the Redemption Date shall be released or repaid to
the Corporation, after which the former holders of shares called for redemption
shall be entitled to receive payment of the Redemption Price in respect of their
shares only from the Corporation.

 

-9-

 

Part 6 - Parity with Other Shares of Series 6 Class F
Preferred Stock and Priority.

6.1  Rateable Participation. If any
cumulative dividends or return of capital in respect of
Series 6 Class F Preferred Stock are not paid in full, the
owners of all series of outstanding Preferred Stock shall
participate rateably in respect of accumulated dividends and
return of capital.

6.2  Ranking. For purposes of this
resolution, any stock of any class or series of the Corporation shall be deemed
to rank:

     6.2.1  Prior or senior
to the shares of this Series 6 Class F Preferred Stock either as to dividends
or 
               upon
liquidation, if the holders of such class or classes shall be entitled to the
receipt
of 
               dividends
or of amounts distributable upon dissolution, liquidation or winding up of
the 
               Corporation,
whether voluntary or involuntary, as the case may be, in preference or
priority
               to
the holders of shares of this Series 6 Class F Preferred Stock;

     6.2.2  On a parity with,
or equal to, shares of this Series 6 Class F Preferred Stock, either as
to 
               dividends
or upon liquidation, whether or not the dividend rates, dividend payment dates,
or
              
redemption or liquidation prices per share or sinking fund provisions, if any,
are different
from 
               those
of this Series 6 Class F Preferred Stock, if the holders of such stock are
entitled to
the 
               receipt
of dividends or of amounts distributable upon dissolution, liquidation or
winding
up 
               of
the Corporation, whether voluntary or involuntary, in proportion to their
respective
dividend 
               rates
or liquidation prices, without preference or priority, one over the other, as
between
the 
               holders
of such stock and over the other, as between the holders of such stock and
the 
               holders
of shares of this Series 6 Class F Preferred Stock; and, 

     6.2.3 Junior to shares of this
Series 6 Class F Preferred Stock, either as to dividends or
upon 
              liquidation,
if such class or series shall be Common Stock or if the holders of shares of
this 
              Series
6 Class F Preferred Stock shall be entitled to receipt of dividends or of
amounts 
              distributable
upon dissolution, liquidation or winding up of the Corporation,
whether 
              voluntary
or involuntary, as the case may be, in preference or priority to the holders of
shares 
              of
such class or series.

 

-10-

 

Part 7 - Amendment and Reissue.

7.1  Amendment.  If any
proposed amendment to the Corporation's Certificate of
Incorporation (the "Articles") would alter or change the
powers, preferences or special rights of the Series 6 Class
F Preferred Stock so as to affect such adversely, then the
Corporation must obtain the affirmative vote of such
amendment to the Articles at a duly called and held series
meeting of the holders of the Series 6 Class F Preferred
Stock or written consent by the holders of a majority of
the Series 6 Class F Preferred Stock then
outstanding. Notwithstanding the above or the provisions of
the GCL, the number of authorized shares of any class or
classes of stock of the Corporation may be increased or
decreased (but not below the number of shares thereof
outstanding) by the affirmative vote of the holders of a
majority of the stock of the Corporation entitled to vote
thereon, voting together as a single class, irrespective of
the provisions of this Section 7.1 or Section 242 of the
GCL.

7.2  Authorized. Any shares of Series 6
Class F Preferred Stock acquired by the Corporation by
reason of purchase, conversion, redemption or otherwise
shall be retired and shall become authorized but unissued
shares of Preferred Stock, which may be reissued as part of
a new series of Preferred Stock hereafter
created.
 
 

 

 

 

 

 

 

-11-

 

CERTIFICATE OF DESIGNATIONS
OF SERIES 7 CLASS
G CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES,
INC.


     Perma-Fix Environmental Services,
Inc. (the "Corporation"), a corporation organized and existing under the General
Corporation Law of the State of Delaware, does hereby certify:

     That, pursuant to authority
conferred upon by the Board of Directors by the Corporation's Restated
Certificate of Incorporation, as amended, and pursuant to the provisions of
Section 151 of the Delaware Corporation Law, the Board of Directors of the
Corporation has adopted resolutions, a copy of which is attached hereto,
establishing and providing for the issuance of a series of Preferred Stock
designated as Series 7 Class G Convertible Preferred Stock and has established
and fixed the voting powers, designations, preferences and relative
participating, optional and other special rights and qualifications, limitations
and restrictions of such Series 7 Class G Convertible Preferred Stock as set
forth in the attached resolutions.

Dated: November 12, 1997

                                                                     PERMA-FIX
ENVIRONMENTAL
                                                                     SERVICES, INC.

                                                                     By
/s/ Louis F.
Centofanti                                     
                                                                         Dr.
Louis F.
Centofanti
                                                                         Chairman of the Board
ATTEST:



/s/ Richard T.
Kelecy                          
Richard
T. Kelecy, Secretary


 

 

 

 

PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the
"Corporation")

RESOLUTION OF THE BOARD OF DIRECTORS

FIXING THE
NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS
ATTACHING TO THE
SERIES 7 CLASS G CONVERTIBLE PREFERRED
STOCK


     WHEREAS, the Corporation's
capital includes preferred stock, par value $.001 per share
("Preferred Stock"), which Preferred Stock may be issued in
one or more series by resolutions adopted by the directors,
and with the directors being entitled by resolution to fix
the number of shares in each series and to designate the rights, designations, preferences and relative, participating,
optional or other special rights and privileges, restrictions
and conditions attaching to the shares of each such
series;

     WHEREAS, it is in the best
interests of the Corporation for the Board to create a new
series from the Preferred Stock designated as the Series 7
Class G Convertible Preferred Stock, par value $.001 per
share (the "Series 7 Class G Preferred Stock");

     NOW, THEREFORE, BE IT
RESOLVED, that the Series 7 Class G Preferred Stock
shall consist of three hundred (350) shares and no more and
shall be designated as the Series 7 Class G Convertible Preferred Stock, and the preferences, rights, privileges, restrictions and conditions attaching to the Series 7 Class G
Preferred Stock shall be as follows:

Part 1 - Voting and Preemptive Rights.

1.1  Voting Rights.  Except as
otherwise provided in Section 242(b)(2) of the General Corporation Law of the
State of Delaware (the "GCL"), the holders of the Series 7 Class G Preferred
Stock shall have no voting rights whatsoever. To the extent that under Section
242(b)(2) of the GCL the vote of the holders of the Series 7 Class G Preferred
Stock, voting separately as a class or series as applicable, is required to
authorize a given action of the Corporation, the affirmative vote or consent of
the holders of at least a majority of the shares of the Series 7 Class G
Preferred Stock represented at a duly held meeting at which a quorum is present
or by written consent of a majority of the shares of Series 7 Class G Preferred
Stock (except as otherwise may be required under the GCL) shall constitute the
approval of such action by the series. To the extent that under Section
242(b)(2) of the GCL the holders of the Series 7 Class G Preferred Stock are
entitled to vote on a matter, each share of the Series 7 Class G Preferred Stock
shall be entitled one (1) vote for each outstanding share of Series 7 Class G
Preferred Stock. Holders of the Series 7 Class G Preferred Stock shall be
entitled to notice of (and copies of proxy materials and other information sent
to stockholders) for all shareholder meetings or written consents with respect
to which they would be entitled to vote, which notice would be provided pursuant
to the Corporation's bylaws and applicable statutes. If the holders of the
Series 7 Class G Preferred Stock are required to vote under Section 242(b)(2) of
the GCL as a result of the number of authorized shares of any such class or
classes of stock being increased or decreased, the number of authorized shares
of any of such class or classes of stock may be increased or decreased (but not
below the number of shares thereof then outstanding) by the affirmative vote of
the holders of a majority of the stock of the Corporation entitled to vote
thereon, irrespective of the provisions of Section 242(b)(2) of the
GCL. 

 

-1-

 

1.2  No Preemptive Rights. The Series 7
Class G Preferred Stock shall not give its holders any
preemptive rights to acquire any other securities issued by
the Corporation at any time in the future.

Part 2 - Liquidation Rights.

2.1  Liquidation. If the Corporation
shall be voluntarily or involuntarily liquidated, dissolved
or wound up at any time when any shares of the Series 7
Class G Preferred Stock shall be outstanding, the holders of
the then outstanding Series 7 Class G Preferred Stock shall
be entitled to receive out of the assets of the Corporation
available for distribution to shareholders an amount equal
to $1,000 consideration per outstanding share of Series 7
Class G Preferred Stock, and no more, plus an amount equal to all unpaid dividends accrued thereon to the date of payment of
such distribution ("Liquidation Preference"), whether or not
declared by the Board of Directors, before any payment shall
be made or any assets distributed to the holders of the
Corporation's Common Stock.

2.2  Payment of Liquidation Preferences.
Subject to the provisions of Part 6 hereof, all amounts to
be paid as Liquidation Preference to the holders of Series 7
Class G Preferred Stock, as provided in this Part 2, shall
be paid or set apart for payment before the payment or
setting apart for payment of any amount for, or the distribution of any of the Corporation's property to the holders
of the Corporation's Common Stock, whether now or
hereafter authorized, in connection with such liquidation,
dissolution or winding up.

2.3  No Rights After Payment. After the
payment to the holders of the shares of the Series 7 Class G
Preferred Stock of the full Liquidation Preference amounts
provided for in this Part 2, the holders of the Series 7
Class G Preferred Stock as such shall have no right or claim
to any of the remaining assets of the Corporation.

2.4  Assets Insufficient to Pay Full Liquidation
Preference. In the event that the assets of the
Corporation available for distribution to the holders of
shares of the Series 7 Class G Preferred Stock upon any
dissolution, liquidation or winding up of the Corporation,
whether voluntary or involuntary, shall be insufficient to
pay in full all amounts to which such holders are entitled
pursuant to this Part 2, no such distribution shall be made
on account of any shares of any other class or series of Preferred Stock ranking on a parity with the shares of this Series
7 Class G Preferred Stock upon such dissolution, liquidation
or winding up unless proportionate distributive amounts
shall be paid on account of the shares of this Series 7
Class G Preferred Stock and shares of such other class or
series ranking on a parity with the shares of this Series 7
Class G Preferred Stock, ratably, in proportion to the full
distributable amounts for which holders of all such parity
shares are respectively entitled upon such dissolution,
liquidation or winding up.

Part 3 - Dividends.

3.1 The holders of the Series 7 Class G Preferred Stock are
entitled to receive if, when and as declared by the Board of Directors of the
Corporation (the "Board") out of funds legally available therefor, cumulative
annual

 

-2-

 

dividends, payable in cash or Common Stock of the Corporation,
par value $.001 per share (the "Common Stock"), or any combination thereof, at
the Corporation's election, at the rate of four percent (4%) per annum of the
Liquidation Value (as defined below) of each issued and outstanding share of
Series 7 Class G Preferred Stock (the "Dividend Rate"). The Liquidation Value of
the Series 7 Class G Preferred Stock shall be $1,000 per outstanding share of
the Series 7 Class G Preferred Stock (the "Liquidation Value"). The dividend is
payable semi-annually within seven (7) business days after each of December
31and June 30 of each year, commencing December 31, 1997 (each, a "Dividend
Declaration Date"). Dividends shall be paid only with respect to shares of
Series 7 Class G Preferred Stock actually issued and outstanding on a Dividend
Declaration Date and to holders of record of the Series 7 Class G Preferred
Stock as of the Dividend Declaration Date. Dividends shall accrue from the first
day of the semi-annual period in which such dividend may be payable, except with
respect to the first semi-annual dividend which shall accrue from the date of
issuance of the Series 7 Class G Preferred Stock. In the event that the
Corporation elects to pay the accrued dividends due as of a Dividend Declaration
Date on an outstanding share of the Series 7 Class G Preferred Stock in Common
Stock of the Corporation, the holder of such share shall receive that number of
shares of Common Stock of the Corporation equal to the product of (a) the
quotient of (i) the Dividend Rate divided by (ii) the average of the closing bid
quotation of the Corporation's Common Stock as reported on the National
Association of Securities Dealers Automated Quotation system ("NASDAQ"), or the
average closing sale price if listed on a national securities exchange, for the
five (5) trading days immediately prior to the Dividend Declaration Date (the
"Stock Dividend Price"), times (b) a fraction, the numerator of which is the
number of days elapsed during the period for which the dividend is to be paid,
and the denominator of which is 365. Dividends on the Series 7 Class G Preferred
Stock shall be cumulative, and no dividends or other distributions shall be paid
or declared or set aside for payment on the Corporation's Common Stock until all
accrued and unpaid dividends on all outstanding shares of Series 7 Class G
Preferred Stock shall have been paid or declared and set aside for
payment. 

Part 4 - Conversion. The holders of the Series 7
Class G Preferred Stock shall have rights to convert the shares of Series 7
Class G Preferred Stock into shares of the Corporation's Common Stock, as
follows (the "Conversion Rights"):

4.1  Right to Convert. The Series 7
Class G Preferred Stock shall be convertible into shares of
Common Stock, as follows:

      4.1.1  Up to one
hundred seventy-five (175) shares of Series 7 Class G
Preferred Stock may be converted at the Conversion Price (as
that term is defined in Section 4.2 below) at any time on or
after November 3, 1997; and,

 

-3-

 

     4.1.2 Up to an additional one
hundred seventy-five (175) shares of Series 7 Class G
Preferred Stock may be converted at the Conversion Price at
any time on or after December 3, 1997.

4.2  Conversion Price. Subject to the
terms hereof, as used herein, the Conversion Price per
outstanding share of Series 7 Class G Preferred Stock shall
be $1.8125 except that, in the event the average closing bid
price per share of the Common Stock for 20 of any 30
consecutive trading days (a "30 Day Period") after March 1,
1998 shall be less than $2.50 as reported on the
over-the-counter market, or the closing sale price if listed
on a national securities exchange and if the holders of the
Series 7 Class G Preferred Stock have engaged in no sales of
Common Stock of the Company during, and for 30 trading days
prior to, the applicable 30 Day Period, the Conversion Price
shall thereafter be the product of the lesser of (i) the
average closing bid quotation of the Common Stock as
reported on the over-the-counter market, or the closing sale
price if listed on a national securities exchange, for the
five trading days immediately preceding the date of the Conversion Notice referred to in Section 4.3 below multiplied
by eighty percent (80%) or (ii) $1.8125. Notwithstanding the
foregoing, the Conversion Price shall not be less than a
minimum of $.75 per share ("Minimum Conversion Price"),
which Minimum Conversion Price shall be eliminated from and
after September 6, 1998. If any of the outstanding shares of
Series 7 Class G Preferred Stock are converted, in whole or
in part, into Common Stock pursuant to the terms of this
Part 4, the number of shares of whole Common Stock to be
issued to the holder as a result of such conversion shall be
determined by dividing (a) the aggregate Liquidation Value
of the Series 7 Class G Preferred Stock so surrendered for
conversion by (b) the Conversion Price as of such
conversion. At the time of conversion of shares of the
Series 7 Class G Preferred Stock, the Corporation shall pay
in cash to the holder thereof an amount equal to all unpaid
and accrued dividends, if any, accrued thereon to the date
of conversion, or, at the Corporation's option, in lieu of
paying cash for the accrued and unpaid dividends, issue that
number of whole shares of Common Stock which is equal to the
quotient of the amount of such unpaid and accrued dividends
to the date of conversion on the shares of Series 7 Class G
Preferred Stock so converted divided by the Stock Dividend
Price, as defined in Part 3 hereof, in effect at the date of
conversion.

4.5 Adjustments for Reclassification and
Reorganization. If the Common Stock issuable upon conversion of the
Series 7 Class G Preferred Stock shall be changed into the same or a different
number of shares of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise (other than a subdivision or
combination of shares provided for in Section 4.4 hereof), the Conversion Price
then in effect shall, concurrently with the effectiveness of such reorganization
or reclassification, be proportionately adjusted so that the Series 7 Class G
Preferred Stock shall be convertible into, in lieu of the number of shares of
Common Stock which the holders of Series 7 Class G Preferred Stock would
otherwise have been entitled to receive, a number of shares of such other class
or classes of stock equivalent to the number of shares of Common Stock that
would have been subject to receipt by the holders upon conversion of the Series
7 Class G Preferred Stock immediately before that change.

-4-

 

4.6   Common Stock Duly
Issued. All Common Stock which
may be issued upon conversion of Series 7 Class G Preferred Stock will, upon issuance, be duly issued, fully paid and
nonassessable and free from all taxes, liens, and charges
with respect to the issue thereof.

4.7    Notice of Adjustments. Upon the occurrence of each
adjustment or readjustment of any Conversion Price pursuant to this
Part 4, the Corporation, at its expense, within a reasonable
period of time, shall compute such adjustment or readjustment
in accordance with the terms hereof and prepare and furnish
to each holder of Series 7 Class G Preferred Stock a
notice setting forth such adjustment or readjustment and showing
in detail the facts upon which such adjustment is
based.

4.8    Issue Taxes. The Corporation shall pay any and all issue
and other taxes that may be payable in respect of any issue
or delivery of shares of Common Stock on conversion of the
Series 7 Class G Preferred Stock pursuant thereto; provided,
however, that the Corporation shall not be obligated to pay
any transfer taxes resulting from any transfer requested by
any holder of Series 7 Class G Preferred Stock in connection
with such conversion.

4.9    Reservation of Stock Issuable Upon
Conversion.
The Corporation shall at all times reserve and keep available
out of its authorized but unissued shares of Common Stock,
solely for the purpose of effecting the conversion of the shares
of the Series 7 Class G Preferred Stock, such number of
its shares of Common Stock as shall, from time to time,
be sufficient to effect the conversion of all outstanding
shares of the Series 7 Class G Preferred stock, and, if at any
time, the number of authorized but unissued shares of Common
Stock shall not be sufficient to effect the conversion of all
then outstanding shares of the Series 7 Class G Preferred
Stock, the Corporation will take such corporate action as may
be necessary to increase its authorized but unissued shares
of Common Stock to such number of shares as shall be
sufficient for such purposes, including, without limitation, engaging
in reasonable efforts to obtain the requisite
stockholder approval of any necessary amendment to its Certificate
of Incorporation.

4.10    Fractional Shares. No fractional shares shall be issued
upon the conversion of any share or shares of Series 7 Class
G Preferred Stock. All shares of Common Stock
(including fractions thereof) issuable upon conversion of more than
one share of Series 7 Class G Preferred Stock by a holder
thereof shall be aggregated for purposes of determining whether
the conversion would result in the issuance of any
fractional share. If, after the aforementioned aggregation, the
conversion would result in the issuance of a fractional
share of Common Stock, such fractional share shall be rounded up
to the nearest whole share.

4.11   Notices. Any notices required by the provisions of this
Part 4 to be given to the holders of shares of Series 7 Class
G Preferred Stock shall be deemed given if deposited in
the United States mail, postage prepaid, and addressed to
each holder of record at his address appearing on the books of
the Corporation.

-5-

 

 

4.12    Business Day. As used herein, the term "business day"
shall mean any day other than a Saturday, Sunday or a day when
the federal and state banks located in the State of New York
are required or is permitted to close.

Part 5 - Redemption.

5.1    Redemption at Corporation's Option. Except as
otherwise provided in this Section 5.1, at any time, and from time
to time, after the expiration of one (1) year from the date
of the first issuance of the Series 7 Class G Preferred
Stock, the Corporation may, at its sole option, but shall not
be obligated to, redeem, in whole or in part, at any time,
and from time to time, the then outstanding Series 7 Class
G Preferred Stock at the following cash redemption prices
per share (the "Redemption Price") if redeemed during the
following periods: (a) within four (4) years from the date
of the first issuance of Series 7 Class G Preferred Stock
- $1,300 per share, if at any time during such four (4)
year period the average of the closing bid price of the
Common Stock for ten (10) consecutive trading days shall be in
excess of Four U.S. Dollars ($4.00) per share, and (b) after four
(4) years from the date of the first issuance of Series 7 Class
G Preferred Stock - $1,000 per share.

5.3    Mechanics of Redemption. Thirty (30) days prior to any
date stipulated by the Corporation for the redemption of Series
7 Class G Preferred Stock (the "Redemption Date"),
written notice (the "Redemption Notice") shall be mailed to
each holder of record on such notice date of the Series 7 Class
G Preferred Stock. The Redemption Notice shall state: (i)
the Redemption Date of such shares, (ii) the number of Series
7 Class G Preferred Stock to be redeemed from the holder to
whom the Redemption Notice is addressed, (iii) instructions
for surrender to the Corporation, in the manner and at the
place designated, of a share certificate or share
certificates representing the number of Series 7 Class G Preferred Stock
to be redeemed from such holder, and (iv) instructions as to
how to specify to the Corporation the number of Series 7 Class
G Preferred Stock to be redeemed as provided in this Part
5.

5.4    Rights of Conversion Upon Redemption. If the
redemption occurs after the first one hundred eighty (180) days after
the first issuance of Series 7 Class G Preferred Stock, then,
upon receipt of the Redemption Notice, any holder of Series 7
Class G Preferred Stock shall have the option, at its sole
election, to specify what portion of its Series 7 Class G
Preferred Stock called for redemption in the Redemption Notice shall
be redeemed as provided in this Part 5 or converted into
Common Stock in the manner provided in Part 4 hereof, except
that, notwithstanding any provision of such Part 4 to the
contrary,

-6-
 
such holder shall have the right to convert into Common
Stock that number of Series 7 Class G Preferred Stock called
for redemption in the Redemption Notice.

5.5    Surrender of Certificates. On or before the Redemption
Date in respect of any Series 7 Class G Preferred Stock,
each holder of such shares shall surrender the required
certificate or certificates representing such shares to the Corporation
in the manner and at the place designated in the
Redemption Notice, and upon the Redemption Date, the Redemption Price
for such shares shall be made payable, in the manner provided
in Section 5.6 hereof, to the order of the person whose
name appears on such certificate or certificates as the
owner thereof. If a share certificate is surrendered and all
the shares evidenced thereby are not being redeemed (as
described below), the Corporation shall cause the Series 7 Class
G Preferred Stock which are not being redeemed to be
registered in the names of the persons or entity whose names appear
as the owners on the respective surrendered share
certificates and deliver such certificate to such person.

5.6   Payment. On the Redemption Date in respect of any Series
7 Class G Preferred Stock or prior thereto, the
Corporation shall deposit with any bank or trust company having a
capital and surplus of at least U. S. $50,000,000, as a trust fund,
a sum equal to the aggregate Redemption Price of all such
shares called from redemption (less the aggregate Redemption
Price for those Series 7 Class G Preferred Stock in respect of
which the Corporation has received notice from the holder thereof
of its election to convert Series 7 Class G Preferred Stock
into Common Stock), with irrevocable instructions and authority
to the bank or trust company to pay, on or after the
Redemption Date, the Redemption Price to the respective holders upon
the surrender of their share certificates. The deposit
shall constitute full payment for the shares to their holders,
and from and after the date of the deposit the redeemed
shares shall be deemed to be no longer outstanding, and
holders thereof shall cease to be shareholders with respect to
such shares and shall have no rights with respect thereto
except the rights to receive from the bank or trust company
payments of the Redemption Price of the shares, without interest,
upon surrender of their certificates thereof. Any funds so
deposited and unclaimed at the end of one year following
the Redemption Date shall be released or repaid to the
Corporation, after which the former holders of shares
called for redemption shall be entitled to receive payment of
the Redemption Price in respect of their shares only from
the Corporation.

Part 6 - Parity with Other Shares of Series 7 Class G
Preferred Stock and Priority.

6.1    Rateable Participation. If any cumulative dividends or
return of capital in respect of Series 7 Class G Preferred Stock
are not paid in full, the owners of all series of
outstanding Preferred Stock shall participate rateably in respect
of accumulated dividends and return of capital.

-7-



6.2   Ranking. For purposes of this resolution, any stock of
any class or series of the Corporation shall be deemed to
rank: 

        6.2.1  Prior or senior to the shares of this Series 7
Class G Preferred Stock either as to dividends 

                  or upon liquidation, if the holders of such
class or classes shall be entitled to the receipt of

                 
dividends or of amounts distributable upon dissolution, liquidation or
winding up of the

                
 Corporation, whether voluntary or involuntary, as the case may be,
in preference or 

                  priority to the holders of
shares of this Series 7 Class G Preferred Stock;

       6.2.2  On a parity with, or equal to, shares of this
Series 7 Class G Preferred Stock, either as to

                  dividends or upon liquidation, whether or not
the dividend rates, dividend payment dates, 

                  or
redemption or liquidation prices per share or sinking fund provisions, if any, are 

                  different
from those of this Series 7 Class G Preferred Stock, if the holders of such 

                  stock are
entitled to the receipt of dividends or of amounts distributable upon 

                  dissolution,
liquidation or winding up of the Corporation, whether voluntary or 

                  involuntary, in
proportion to their respective dividend rates or liquidation prices, 

                  without preference or
priority, one over the other, as between the holders of such 

                  stock and over the other, as
between the holders of such stock and the holders of 

                  shares of this Series 7 Class G
Preferred Stock; and,

        6.2.3  Junior to shares of this Series 7 Class G
Preferred Stock, either as to dividends or upon

                 
liquidation, if such class or series shall be Common Stock or if the holders of
shares of this 

                  Series 7 Class G Preferred
tock shall be entitled to receipt of dividends or of amounts

                 
distributable upon dissolution, liquidation or winding up of the
Corporation, whether 

                  voluntary or involuntary,
as the case may be, in preference or priority to the holders of 

                  shares of such class or
series.

Part 7 - Amendment and Reissue.
7.1  
 Amendment. If any proposed amendment to the
Corporation's Certificate of Incorporation (the "Articles") would
alter or change the powers, preferences or special rights of
the Series 7 Class G Preferred Stock so as to affect such
adversely, then the Corporation must obtain the
affirmative vote of such amendment to the Articles at a duly called
and held series meeting of the holders of the Series 7 Class
G Preferred Stock then outstanding. Notwithstanding the
above or the provisions of the GCL, the number of authorized
shares of any class or classes of stock of the Corporation may
be increased or decreased (but not below the number of
shares thereof outstanding) by the affirmative vote of the holders of a majority

-8-
 
of the stock of the Corporation entitled
to vote thereon, voting together as a single class,
irrespective of the provisions of this Section 7.1 or Section 242 of
the GCL.

7.2  Authorized. Any shares of Series 7 Class G
Preferred Stock acquired by the Corporation by reason of
purchase, conversion, redemption or otherwise shall be retired
and shall become authorized but unissued shares of
Preferred Stock, which may be reissued as part of a new series
of Preferred Stock hereafter created.

 

 

 

 

 

 

 

-9-

 

STATE OF DELAWARE

SECRETARY OF STATE

DIVISION OF CORPORATIONS

FILED 10:00 A.M. 11/26/1997

971405163 -- 2249849



CERTIFICATE OF ELIMINATION

OF

SERIES 4 CLASS D CONVERTIBLE PREFERRED STOCK

AND

SERIES 5 CLASS E CONVERTIBLE PREFERRED STOCK

OF

PERMA-FIX ENVIRONMENTAL SERVICES, INC.

____________________________________________



           PERMA-FIX ENVIRONMENTAL SERVICES, INC., a corporation
organized and existing under the General Corporation Law of
the State of Delaware (hereinafter called the "Corporation"),
hereby certifies the following:

          1.  That the Certificate of Designations of Series 4 Class
D Convertible Preferred Stock of the Corporation (the "Series
4 Preferred") was filed on June 11, 1997 (the "Series 4
Certificate of Designations").

          2.
 That all outstanding shares of the Series 4
Preferred have been delivered to the Company and exchanged upon
agreement with the holder thereof pursuant to the terms and conditions of
a certain Exchange Agreement between the Company and RBB
Bank Aktiengesellschaft, dated effective as of September 16,
1997.

           3.  That no shares of Series 4 Preferred remain
outstanding.

           4.  That all shares of the Series 4 Preferred which have
been exchanged have the status of authorized and unissued shares of
the Preferred Stock of the Corporation without designation as
to series, until such shares are once more designated as part of
a particular series by the Board of Directors.

           5.  That effective September 16, 1997, the Board of
Directors of the Company duly adopted the following
resolutions:

                 RESOLVED, that upon completion of the exchange
with the holder

                
of the Series 4 Class D Convertible Preferred Stock, no authorized

                 shares of Series 4 Class D Convertible
Preferred Stock will remain 

                 outstanding and no shares of Series 4 Class D Convertible
Preferred 

                 Stock will be issued subject to the
Certificate of Designations previously 

                 filed
with respect to the Series 4 Class D Convertible Preferred Stock.

                 FURTHER RESOLVED, that upon completion of the
exchange, the 

                 officers of the Company are
hereby authorized and directed, for and on

                 behalf of the Company, to execute and deliver
an appropriate Certificate 

 

 

                 of Elimination to
the Secretary of State of Delaware regarding

                 the Series 4 Class D Convertible Preferred
Stock.

          6.   That the Certificate of Designations of the Series
5 Class E Convertible Preferred Stock of the Corporation (the
"Series 5 Preferred") was filed on July 14, 1997 (the "Series 5
Certificate of Designations").

          7.   That all outstanding shares of the Series 5
Preferred have been delivered to the Company and exchanged upon
agreement with the holder thereof pursuant to the terms and conditions of
a certain Exchange Agreement between the Company and The
Infinity Fund, L.P., dated effective as of September 16,
1997.

          8.
  That no shares of Series 5 Preferred remain
outstanding.

          9.   That all shares of the Series 5 Preferred which have
been exchanged have the status of authorized and unissued shares of
the Preferred Stock of the Corporation without designation as
to series, until such shares are once more designated as part of
a particular series by the Board of Directors.

          10.  That effective September 16, 1997, the Board of
Directors of the Company duly adopted the following
resolutions:

                  RESOLVED, that upon completion of the exchange
with the holder 

                  of the Series 5 Class E
Convertible Preferred Stock, no authorized

                  shares of Series 5 Class E Convertible
Preferred Stock will remain 

                  outstanding and no
shares of Series 5 Class E Convertible Preferred 

                  Stock will be issued subject to the
Certificate of Designations previously 

                  filed
with respect to the Series 5 Class E Convertible Preferred Stock.

                   FURTHER RESOLVED, that upon completion of the
exchange, the 

                  officers of the Company are
hereby authorized and directed, for and on 

                  behalf of
the Company, to execute and deliver an appropriate Certificate 

                  of Elimination to
the Secretary of State of Delaware regarding the Series 

                  5 Class E Convertible Preferred
Stock.

          11.  That pursuant to the provisions of Section 151(g) of
the Delaware General Corporation Law, upon the effective date of
the filing of this Certificate, this Certificate will have the
effect of eliminating from the Restated Certificate of Incorporation
only those matters set forth in the Restated Certificate
of Incorporation with respect to the Series 4 Class D
Convertible Preferred Stock and the Series 5 Class E Convertible
Preferred Stock.

 

-2-

 

           IN WITNESS WHEREOF, this Certificate of Elimination has
been executed this 20th day of November, 1997, by the President of
the Company.

                                                                                PERMA-FIX ENVIRONMENTAL

ATTEST:                                                                 SERVICES, INC.




  /s/ Richard T. Kelecy
                                              By /s/ Louis Centofanti                          


  Richard T. Kelecy, Secretary                                        Dr. Louis F.
Centofanti,

                                                                                      President
(SEAL)
 
 

 

 

 

 

 

-3-
 
STATE OF
DELAWARE      

SECRETARY OF STATE      

DIVISION OF CORPORATIONS

FILED 12:00 PM 07/10/1998  

981268436 -- 2249849        

CERTIFICATE OF DESIGNATIONS

OF RIGHTS AND PREFERENCES OF THE

SERIES 10 CLASS J CONVERTIBLE PREFERRED STOCK
OF

PERMA-FIX ENVIRONMENTAL SERVICES,
INC.



We, being respectively the President and Secretary of Perma-Fix Environmental Services, Inc. a corporation organized and
existing under the laws of the State of Delaware (hereinafter
the "Corporation"), DO HEREBY CERTIFY:

FIRST:

That pursuant to authority expressly granted and vested in
the Board of Directors of said Corporation under Section 151 of
the Delaware General Corporation Law (the "GCL"), and the provisions
of the Corporation's Restated Certificate of Incorporation, said
Board of Directors, on June 30th, 1998 (the "Closing Date"), adopted
the following resolution setting forth the designations,
powers, preferences and rights of its Series 10 Class J
Convertible Preferred Stock (the "Certificate of
Designations").

RESOLVED: That the designations, powers, preferences and rights
of the Series 10 Class J Convertible Preferred Stock be, and
they hereby are, as set forth below:

1.  Number of Shares of Common Stock of Series 10 Class
J Convertible Preferred Stock

The Corporation hereby authorizes the issuance of up to
3,000 (three thousand,) shares of Series 10 Class J Convertible
Preferred Stock par value $.001 per share (the "Preferred Stock").
This Preferred Stock shall pay an annual dividend based on a 365
day calendar year of 4% of the Liquidation Value (as defined in
Section 3 hereof) ("Dividend Rate"), payable semiannually within ten
(10) business days after each subsequent June 30th and December
31st (each a "Dividend Declaration Date"), and shall be payable in
cash or shares of the Corporation's par value $.001 per share
common stock (Common Stock) at the Corporation's option. The
first Dividend Declaration Date shall be December 31st,
1998.

In the event that the Corporation elects to pay the
accrued dividends due as of a Dividend Declaration Date on the
outstanding shares of Preferred Stock in Common Stock of the Corporation,
the Holder of each share of Preferred Stock shall receive that
number of shares of Common Stock equal to the product of (a) the
quotient of (i) the Dividend Rate divided by (ii) the average of'
the closing bid quotation of the Corporation's Common Stock as
reported on the National Association of Securities Dealers
Automated Quotation system ("NASDAQ"), or if the Common Stock is not
listed for trading on a national

     ;1
 
securities exchange, the average closing bid price of the
Common Stock as quoted on such national exchange, for the five (5)
trading days immediately prior to the Dividend Declaration Date (the
"Stock Dividend Price"), times (b) a fraction, the numerator of which
is the number of days elapsed during the period for which the
dividend is to be paid, and the denominator of which is 365. Dividends
on the Preferred Stock shall be cumulative, and no dividends or
other distributions shall be paid or declared or set aside for payment
on the Corporation's Common Stock until all accrued and
unpaid dividends on all outstanding shares of Preferred Stock shall
have been paid or declared and set aside for payment.

2. Voting.

(a)     Except as provided under Section 242 of the GCL, holders
of Preferred Stock (the "Holders") shall not have the right to
vote on any matter. Notwithstanding the provisions of Section 242
of the GCL or Section 4 hereof, the number of authorized shares of
any class or classes of stock of the Corporation may be increased
or decreased (but not below the number of shares thereof
outstanding) by the affirmative vote of the holders of a majority of the
stock of the Corporation entitled to vote thereon, voting together as
a single class, irrespective of the provisions of Section 242 of
the GCL.

3. Liquidation.

In the event of a voluntary or involuntary
dissolution, liquidation, or winding up of the Corporation, the Holders
of Preferred Stock shall be entitled to receive out of the assets
of the Corporation legally available for distribution to holders
of its capital stock, before any payment or distribution shall be
made to holders of shares of Common Stock or any other class of
stock ranking junior to the Preferred Stock, an amount per share
of Preferred Stock equal to $1,000 (the "Liquidation Value") plus
any accrued and unpaid dividends on the Preferred Stock. If upon
such liquidation, dissolution, or winding up of the Corporation,
whether voluntary or involuntary, the assets to be distributed among
the Holders of Preferred Stock shall be insufficient to permit
payment to the Holders of Preferred Stock of the amount distributable
as aforesaid, then the entire assets of the Corporation to be
so distributed shall be distributed ratably among the Holders
of Preferred Stock and shares of such other classes or series
ranking on a parity with the shares of this Preferred Stock in
proportion to the full distributable amounts for which holders of all
such parity shares are entitled upon such distribution, liquidation,
or winding up. Upon any such liquidation, dissolution or winding
up of the Corporation, after the Holders of Preferred Stock
shall have been paid in full the amounts to which they shall be
entitled, the remaining net assets of the Corporation may be distributed
to the holders of stock ranking on liquidation junior to the
Preferred Stock and the Holders of the Preferred Stock shall have no right
or claim to any of the remaining assets of the Corporation.
Written notice of such liquidation, dissolution or winding up, stating
a payment date, the amount of the liquidation payments and the
place

 
     ;2
 
where said liquidation payments shall be payable, shall be given
by mail, postage prepaid or by telex or facsimile to non-U.S.
residents, not less than 10 days prior to the payment date
stated therein, to the Holders of record of Preferred Stock, such
notice to be addressed to each such Holder at its address as shown by
the records of the Corporation. For purposes hereof the shares
of Common Stock, shall rank on liquidation junior to the
Preferred Stock.

4. Restrictions.

The Corporation will not amend or modify the terms of its
Restated Certificate of Incorporation so as to adversely alter or change
the Preferred Stock at any time when shares of Preferred Stock
are outstanding, without the approval of the Holders of at least
a majority of the then outstanding shares of Preferred Stock given
in writing or by vote at a meeting, consenting or voting (as the
case may be) separately as a series, except where the vote or
written consent of the Holders of a greater number of shares of
Common Stock of the Corporation is required by law or by the
Corporation's Certificate of Incorporation, as amended.

5. Optional Conversion.

The Holders of shares of Preferred Stock shall have the
following conversion rights to convert the shares of Preferred Stock
into shares of Common Stock of the Corporation:

(a)     Conversion Dates, The Holder of any share or shares
of Preferred Stock may convert cumulatively any of such
Preferred Stock at any time subsequent to 180 days after the Closing
Date. 

(b)     Right to Convert; Conversion Price. Subject to the
terms hereof, as used herein, the term Conversion Price per
outstanding share of Preferred Stock shall be One Dollar and 875/1000
($1.875); except that after the expiration of one hundred and eighty
(180) days after the Closing Date if the average of the closing bid
price per share of Common Stock quoted on the NASDAQ (or the closing
bid price of the Common Stock as quoted on the national
securities exchange if the Common Stock is not listed for trading on
the NASDAQ but is listed for trading on a national securities
exchange) for the five (5) trading days immediately prior to the
particular date of each Conversion Notice (as defined below) is less than
Two Dollars and 34/100 ($2.34), then the Conversion Price for
that particular conversion shall be eighty percent (80%) of the
average of the closing bid price of the Common Stock on the NASDAQ (or
if the Common Stock is not listed for trading on the NASDAQ but
is listed for trading on a national securities exchange then
eighty percent (80%) of the average of the closing bid price of the
Common Stock on the national securities exchange) for the five (5)
trading days immediately prior to the particular date of the
Conversion Notice. If any of the outstanding shares of Preferred Stock
are converted, in whole or in part, into Common Stock pursuant to
the terms of this Section 5(b), the number of shares of whole
Common Stock to be issued to the Holder as a result of such
conversion shall be determined



     ;3

 

by dividing (a) the aggregate Stated Value
of the Preferred Stock so surrendered for conversion by (b)
the Conversion Price in effect on the date of that
particular Conversion Notice relating to such conversion. At the time
of conversion of shares of the Preferred Stock, the Corporation
shall pay in cash to the holder thereof an amount equal to all unpaid
and accrued dividends, if any, accrued thereon on the shares
of Preferred so converted to the date of the Conversion
Notice relating to such conversion, or, at the Corporation's option,
in lieu of paying cash for the accrued and unpaid dividends,
issue that number of shares of whole Common Stock which is equal to
the quotient of the amount of such unpaid and accrued dividends to
the date of the Conversion Notice relating to such conversion of
the shares of Preferred Stock so converted divided by the
Stock Dividend Price, in effect at the date of the Conversion
Notice relating to such conversion.

(c)      Conversion Notice. The right of conversion shall be
exercised by the Holder thereof by telecopying or faxing an executed
and completed written notice signed by an authorized representative
of the Holder, ("Conversion Notice") to the Corporation that
the Holder elects to convert a specified number of shares of
Preferred Stock representing a specified Stated Value thereof into shares
of Common Stock and by delivering by express courier the
certificate or certificates of Preferred Stock being converted to
the Corporation at its principal office (or such other office or
agency of the Corporation as the Corporation may designate by notice
in writing to the Holders of the Preferred Stock). The business
date indicated on a Conversion Notice which is telecopied to
and received by the Corporation in accordance with the
provisions hereof shall be deemed a Conversion Date. The Conversion
Notice shall include therein the Stated Value of shares of Preferred
Stock to be converted, and a calculation (a) of the Stock Dividend
Price, (b) the Conversion Price, and (c) the number of Shares of
Common Stock to be issued in connection with such conversion.
The Corporation shall have the right to review the
calculations included in the Conversion Notice, and shall provide notice of
any discrepancy or dispute therewith within three (3) business days
of the receipt thereof. The Holder shall deliver to the
Corporation an original Conversion Notice and the original Preferred to
be converted within three (3) business days from the date of
the Conversion Notice.

(d)     Issuance of Certificates - Time Conversion
Effected.  Promptly, but in no event more than six (6) business days,
after the receipt by facsimile of the Conversion Notice referred to
in Subparagraph (5)(c); and provided within the six (6) business
days the Corporation receives the certificate or certificates for
the shares of Preferred Stock to be converted, the Corporation
shall issue and deliver, or cause to be issued and delivered, to
the Holder, registered in the name of the Holder, a certificate
or certificates for the number of whole shares of Common Stock
into which such shares of Preferred Stock are converted.
Such conversion shall be deemed to have been effected as of the close
of business on the date on which the telecopy or facsimile
Conversion Notice shall have been received by the Corporation, and the
rights of the Holder of such share or shares of Preferred Stock
shall cease, at such time, and the Holder or Holders shall be deemed
to have become the Holder or Holders of record of the shares of
Common Stock represented thereby.

 
     ;4
 
In the event that the shares of Common Stock issuable
upon conversion of the Preferred, is not delivered within six
(6) business days of the date the Company receives the
Conversion Notice, the Company shall pay to the Buyer, by wire transfer,
as liquidated damages for such failure and not as a penalty, for
each $100,000 of Preferred sought to be converted, $500 for each of
the first five (5) calendar days and $1,000 per calendar day
thereafter that the shares of Common Stock are not delivered, which
liquidated damages shall begin to run from the seventh (7th) business
day after the Conversion Date. Any and all payments required
pursuant to this paragraph shall be payable only in cash.
Notwithstanding the above, liquidated damages shall not exceed $2,000.00 per
day.  In addition to the liquidated damages set forth herein, in
the event the Company fails to deliver the shares of Common
Stock within six (6) business days after the Conversion date, the
Company agrees to issue the larger number of shares of Common Stock
derived from (i) the original Conversion Notice, or (ii) utilizing the
five lowest closing bid prices of the Company's shares of Common
Stock beginning on the Conversion Date and ending on the day the
shares of Common Stock are delivered. The Company understands that
a delay in the issuance of the shares of Common Stock could result
in economic loss to the Holder. Nothing contained herein, or in
the Preferred shall limit the Holder's rights to pursue actual
damages for the Company's failure to issue and deliver shares of
Common Stock to the Holder in accordance with the terms of the
Certificate of Designations, and this Agreement.

(e)      Fractional Shares of Common Stock. No fractional shares
of Common Stock shall be issued upon conversion of any Preferred
Stock into shares of Common Stock. All fractional shares of Common
Stock shall be aggregated and then rounded down to the nearest
whole share of Common Stock. In case the number of shares of
Preferred Stock represented by the certificate or certificates
surrendered pursuant to Subparagraph 5(b) exceeds the number of shares
of Common Stock converted, the Corporation shall, upon
such conversion, execute and deliver to the Holder, at the expense
of the Corporation, a new certificate or certificates for the
number of shares of Preferred Stock represented by the certificate
or certificates surrendered which are not to be
converted.

(f)      Merger or Consolidation. In case of either (a) any merger
or consolidation to which the Corporation is a party
(collectively, the "Merger"), other than a Merger in which the Corporation is
the surviving or continuing corporation, or (b) any sale or
conveyance to another corporation of all, or substantially all, of the
assets of the Corporation (collectively, the "Sale"), and such Merger
or Sale becomes effective (x) while any shares of Preferred Stock
are outstanding and prior to the date that the
Corporation's Registration Statement covering all the shares of Common
Stock issuable upon the conversion of the Preferred Stock is
declared effective by the U.S. Securities and Exchange
Commission ("Commission"), the Corporation or such successor corporation
as the case may be, shall make appropriate provision so that
the Holder of each share of Preferred Stock then outstanding shall
have the right to convert such share of Preferred Stock into the
kind and amount of shares of stock or other securities and
property receivable upon such Merger or Sale by a holder of the number
of shares of Common Stock into which such shares of Preferred
Stock could have been converted into immediately prior to such Merger
or

     ;5
 
Sale, subject to adjustments which shall be as nearly equivalent
as may be practicable to the adjustments provided for in this
Section 5.

In the event of a Merger or Sale, where the Corporation is not
the surviving Corporation, the Holder shall have the right to
redeem all of the outstanding shares of Preferred Stock at 120% of
the Liquidation Value of each share of Preferred Stock then
outstanding plus all accrued and unpaid dividends (the "Redemption
Amount"). The Corporation shall pay this Redemption Amount in cash within
ten (10) business days of receipt by the Corporation of notice from
the Holder, and receipt by the Corporation of all outstanding shares
of Preferred Stock duly endorsed by the Holder to the
Corporation.

(g)     Adjustments to Conversion Price for Stock Dividends and
for Combinations or Subdivisions of Common
Stock. If the
Corporation at any time or from time to time while shares of Preferred
Stock are issued and outstanding shall declare or pay, any dividend
on the Common Stock payable in Common Stock, or shall effect
a subdivision of the outstanding shares of Common Stock into
a greater number of shares of Common Stock (by stock
split, reclassification or otherwise than by payment of a dividend
in Common Stock), or if the outstanding shares of Common Stock
shall be combined or consolidated, by reclassification or otherwise,
into a lesser number of shares of Common Stock, then the
Conversion Price in effect immediately before such event shall,
concurrently with the effectiveness of such event, be proportionately
decreased or increased, as appropriate.

(h)     Adjustments for Reclassification and
Reorganization.
If the Common Stock issuable upon conversion of the Preferred
Stock shall be changed into the same or a different number of shares
of Common Stock of any other class or classes of stock, whether
by capital reorganization, reclassification or otherwise (other
than a subdivision or combination or shares of Common Stock provided
for in Section 5(g) hereof), the Conversion Price then in effect
shall, concurrently with the effectiveness of such reorganization
or reclassification, be proportionately adjusted so that the
Preferred Stock shall be convertible into, in lieu of the number of shares
of Common Stock which the holders of Preferred Stock would
otherwise have been entitled to receive, a number of shares of Common
Stock of such other class or classes of stock equivalent to the number
of shares of Common Stock that would have been subject to receipt
by the holders upon conversion of the Preferred Stock
immediately before that change.

6. Assignment.

Subject to all applicable restrictions on transfer, the
rights and obligations of the Corporation and the Holder of
the Preferred Stock shall be binding upon and benefit the
successors, assigns, heirs, administrators, and transferees of the
parties.

 
     ;6
 
7. Shares of Common Stock to be Reserved.

The Corporation, upon the effective date of this Certificate
of Designations, has a sufficient number of shares of Common
Stock available to reserve for issuance upon the conversion of
all outstanding shares of Preferred Stock, pursuant to the terms
and conditions set forth in Section 5, and exercise of the Warrants
as defined in Section 11. The Corporation will at all times
reserve and keep available out of its authorized shares of Common
Stock, solely for the purpose of issuance upon the conversion of
Preferred Stock, and exercise of the Warrants, as herein provided,
such number of shares of Common Stock as shall then be issuable upon
the conversion of all outstanding shares of Preferred Stock,
and exercise of the Warrants. The Corporation covenants that
all shares of Common Stock which shall be so issued shall be duly
and validly issued, fully paid and non assessable. The
Corporation will take such action as may be required, if the total number
of shares of Common Stock issued and issuable after such action
upon conversion of the Preferred Stock, and exercise of the
Warrants would exceed the total number of shares of Common Stock
then authorized by the Corporation's Certificate of Incorporation,
as amended, or would exceed 19.99% of the shares of Common Stock
then outstanding if required by law or the Rules and Regulations
of NASDAQ or the National Securities Exchange applicable to
the Corporation to take such action as a result of exceeding
such 19.99%, in order to increase the number of shares of Common
Stock to permit the Corporation to issue the number of shares of
Common Stock required to effect conversion of the Preferred, and
exercise of the Warrants, to a number sufficient to permit conversion of
the Preferred Stock, and exercise of the Warrants, including,
without limitation, engaging in reasonable efforts to obtain the
requisite stockholder approval of any necessary amendment to
the Corporation's Restated Certificate of Incorporation, and to
obtain shareholders approval in order to effect conversion of
the Preferred Stock, and exercise of the Warrants, if required by
lawor the rules or regulations of the NASDAQ or National
Securities Exchange applicable to the Corporation.

7(a) Shareholder Approval. In connection with the issuance to
the Holder of the shares of Preferred Stock, pursuant to
this Certificate of Designations, the Corporation is also issuing
(i) certain warrants ("RBB Warrants") to the Holder pursuant to
the terms of that certain Private Securities Subscription
Agreement dated June 30th, 1998 (the "Agreement"), providing for the
purchase of up to 150,000 shares of Common Stock at an exercise price
of $2.50 per share and (ii) certain warrants (collectively,
the "Liviakis Warrants") to Liviakis Financial Communication,
Inc. ("Liviakis") and Robert B. Prag providing for the purchase of up
to an aggregate of 2,500,000 shares of Common Stock at an
exercise price of $1.875 per share pursuant to the terms of that
Placement and Consulting Agreement dated June 30th, 1998, between
Liviakis and the Corporation.

If (i) the aggregate number of shares of Common Stock issued by
the Corporation as a result of any or all of the following:
(a) conversion of the Preferred Stock, (b) payment of dividends
accrued on the Preferred Stock (c) exercise of the RBB Warrants, and
(d) exercise of the Liviakis Warrants exceeds 2,388,347 shares
of Common Stock (which equals 19.9% of the outstanding shares
of 

     ;7

 
Common Stock of the Corporation as of the date of this
Certificate of Designations) and (ii) the Holder has converted or elects
to convert any of the then outstanding shares of Preferred
Stock pursuant to the terms of this Section 5 at a Conversion Price
less than $1.875 ($1.875 the market value per share of Common Stock
as quoted on the NASDAQ as of the close of business on June
30th, 1998) pursuant to the terms of Section 5(b) hereof, other than
if the Conversion Price is less than $1.875 solely as a result of
the anti-dilution provisions of Section 5(g) and (h) hereof,
then, notwithstanding anything in Section 5 to the contrary,
the Corporation shall not issue any shares of Common Stock as a
result of receipt of a Conversion Notice unless and until the
Corporation shall have obtained approval of its shareholders entitled to
vote on the transactions in accordance with subparagraphs
(25)(H)(i)d, (iv) and (v) of Rule 4310 of the NASDAQ Marketplace
Rules ("Shareholder Approval").

If Shareholder Approval is required as set forth in the
above paragraph, the Corporation shall take all necessary steps to
obtain such Shareholder Approval upon receipt of the Conversion
Notice triggering the need for Shareholder Approval ("Current
Conversion Notice"). If the Corporation has not received from the Holder
a Current Conversion Notice, the Holder, subsequent to January
1st, 1999 may, if the Corporation's shares of Common Stock
trade, subsequent to January 1st, 1999, at a five (5) day average
closing bid price below Two Dollars and 34/00 ($2.34), upon written
notice to the Corporation, require the Corporation to obtain
Shareholder Approval ("Holder's Notice"). The Holder and the
Corporation's officers and directors covenant to vote all shares of Common
Stock over which they have voting control in favour of
Shareholder Approval. If the Corporation does not obtain Shareholder
Approval within ninety (90) days of the earlier of the Corporation's
receipt of (i) the Current Conversion Notice or (ii) the Holder's
Notice, and the Holder has not breached its covenant to vote all shares
of Common Stock over which they have voting control in favour
of Shareholder Approval, the Corporation shall pay in cash to
the Holder liquidated damages, in an amount of 4% per month of
the Liquidation Value of each share of Preferred Stock
then outstanding, commencing on the 91st day of the
Corporation's receipt of the Holder's Current Conversion Notice, and
continuing every thirty (30) days pro-rata until such time the
Corporation receives Shareholder Approval.

8.   No Reissuance of Series 10 Class J Convertible
Preferred Stock.

Shares of Preferred Stock which are converted into shares of
Common Stock as provided herein shall be retired and shall
become authorized but unissued shares of Preferred Stock, which may
be reissued as part of a new series of Preferred stock
hereafter created.

9.   Closing of Books.

The Corporation will at no time close its transfer books
against the transfer of any Preferred Stock or of any shares of
Common Stock issued or issuable upon the conversion of any shares
of

     ;8
 
Common Stock of Preferred Stock in any manner which interferes
with the timely conversion of such Preferred Stock, except as
may otherwise be required to comply with applicable securities
laws.

10. No Preemptive Rights.

The Preferred Stock shall not give its holders any
preemptive rights to acquire any other securities issued by the
Corporation at any time in the future.

11. Definition of Shares.

As used in this Certificate of Designations, the term "shares
of Common Stock" shall mean and include the Corporation's
authorized common stock, par value $.001, as constituted on the date of
filing of these terms of the Preferred Stock, or in case of
any reorganization, reclassification, or stock split of the
outstanding shares of Common Stock thereof, the stock, securities or
assets provided for hereof. The term "Warrants" as used herein shall
have the same meaning as defined in Section 1 of the Private
Securities Subscription Agreement, dated June 30th 1998, between the
Company and RBB Bank Aktiengesellschaft.

The said determination of the designations, preferences
and relative, participating, optional or other rights, and
the qualifications, limitations or restrictions thereof, relating
to the Preferred Stock was duly made by the Board of
Directors pursuant to the provisions of the Corporation's
Restated Certificate of Incorporation and in accordance with the
provisions of the Delaware General Corporation Law.

IN WITNESS HEREOF, this Certificate of Designations has
been signed by:

Dr. Louis F. Centofanti, President on this 30th day of
June, 1998.


/s/ Louis Centofanti                                                                       

President, Perma-Fix Environmental Services,
Inc.



Richard Kelecy, Secretary on this 30th day of June,
1998


/s/ Richard T. Kelecy                                                                     

Secretary, Perma-Fix Environmental Services,
Inc.
 

 

     ;9
STATE
OF DELAWARE   

SECRETARY OF STATE   

DIVISION OF CORPORATIONS

FILED 01:30 PM 07/16/1998  

981277755 -- 2249849      

CERTIFICATE OF ELIMINATION

OF

SERIES 6 CLASS F CONVERTIBLE PREFERRED STOCK

AND

SERIES 7 CLASS G CONVERTIBLE PREFERRED STOCK

OF

PERMA-FIX ENVIRONMENTAL SERVICES, INC.

____________________________________________


          PERMA-FIX ENVIRONMENTAL SERVICES, INC., a corporation
organized and existing under the General Corporation Law of
the State of Delaware (hereinafter called the "Corporation"),
hereby certifies the following:
          1.    That the Certificate of Designations of Series 6 Class
F Convertible Preferred Stock of the Corporation (the "Series
6 Preferred") was filed with the Delaware Secretary of State
on November 13, 1997 (the "Series 6 Certificate of
Designations").

          2.
    That all outstanding shares of the Series 6
Preferred have been delivered to the Company and exchanged upon
agreement with the holder thereof pursuant to the terms and conditions of
a certain Second RBB Exchange Agreement between the Company and
RBB Bank Aktiengesellschaft, dated effective as of February 28,
1998.

          3.
     That no shares of Series 6 Preferred remain
outstanding.

          4.
     That all shares of the Series 6 Preferred which have
been exchanged have the status of authorized and unissued shares of
the Preferred Stock of the Corporation without designation as
to series, until such shares are once more designated as part of
a particular series by the Board of Directors.

          5.
    That effective February 28, 1998, the Board of
Directors of the Company duly adopted the following
resolutions:

                   RESOLVED, that upon completion of the exchange
with the holder of 

                   the Series 6 Class F
Convertible Preferred Stock, no authorized shares 

                   of Series 6 Class F Convertible
Preferred Stock will remain outstanding 

                   and no
shares of Series 6 Class F Convertible Preferred Stock will be 

                   issued subject to the
Certificate of Designations previously filed with 

                   respect to the Series 6 Class F
Convertible Preferred Stock.

                   FURTHER RESOLVED, that upon completion of the
exchange, the 

                   officers of the Company are
hereby authorized and directed, for and on 

                   behalf of the Company, to execute and deliver
an appropriate Certificate 

 

 

                   of Elimination to
the Secretary of State of Delaware regarding the Series 6 

                   Class F Convertible Preferred
Stock.

          6.    That the Certificate of Designations of the Series
7 Class G Convertible Preferred Stock of the Corporation (the
"Series 7 Preferred") was filed on November 13, 1997 (the "Series
7 Certificate of Designations").

          7.
    That all outstanding shares of the Series 7
Preferred have been delivered to the Company and exchanged upon
agreement with the holder thereof pursuant to the terms and conditions of
a certain Exchange Agreement between the Company and The
Infinity Fund, L.P., dated effective as of February 28,
1998.

          8.
    That no shares of Series 7 Preferred remain
outstanding.

          9.     That all shares of the Series 7 Preferred which have
been exchanged have the status of authorized and unissued shares of
the Preferred Stock of the Corporation without designation as
to series, until such shares are once more designated as part of
a particular series by the Board of Directors.

          10.
  That effective February 28, 1998, the Board of
Directors of the Company duly adopted the following
resolutions:

                   RESOLVED, that upon completion of the exchange
with the holder 

                   of the Series 7 Class G
Convertible Preferred Stock, no authorized shares 

                   of Series 7 Class G Convertible
Preferred Stock will remain outstanding 

                   and no
shares of Series 7 Class G Convertible Preferred Stock will be issued 

                   subject to the
Certificate of Designations previously filed with respect to the 

                   Series 7 Class G
Convertible Preferred Stock.

                    FURTHER RESOLVED, that upon completion of the
exchange, the officers 

                    of the Company are
hereby authorized and directed, for and on behalf of the 

                    Company, to execute and deliver
an appropriate Certificate of Elimination to 

                    the Secretary of State of Delaware regarding
the Series 7 Class G Convertible 

                    Preferred
Stock.

          11.    That pursuant to the provisions of Section 151(g) of
the Delaware General Corporation Law, upon the effective date of
the filing of this Certificate, this Certificate will have the
effect of eliminating from the Restated Certificate of Incorporation
only those matters set forth in the Restated Certificate
of Incorporation with respect to the Series 6 Class F
Convertible  Preferred Stock and the Series 7 Class G Convertible
Preferred Stock.

 
-2-
 
          IN WITNESS WHEREOF, this Certificate of Elimination has
been executed this 30th day of April, 1998, by the President of
the Company.

                                                                             PERMA-FIX ENVIRONMENTAL

ATTEST:                                                              SERVICES, INC.




/s/ Richard T. Kelecy                                              By  /s/ Louis Centofanti                                     

Richard T. Kelecy, Secretary                                        Dr. Louis F.
Centofanti,


                                                                                     President
(SEAL)
 
 

 

 

 

 

 

-3-
 
STATE OF DELAWARE    

SECRETARY OF STATE    

DIVISION OF CORPORATIONS

FILED 01:31 PM 07/16/1998

981277757 -- 2249849    

 

CERTIFICATE OF DESIGNATIONS

OF SERIES 8 CLASS H CONVERTIBLE PREFERRED STOCK

OF

PERMA-FIX ENVIRONMENTAL SERVICES, INC.

 

         Perma-Fix Environmental Services, Inc. (the "Corporation"),
a corporation organized and existing under the General
Corporation Law of the State of Delaware, does hereby
certify:

          That, pursuant to authority conferred upon by the Board
of Directors by the Corporation's Restated Certificate
of Incorporation, as amended, and pursuant to the provisions
of Section 151 of the Delaware Corporation Law, the Board of
Directors of the Corporation has adopted resolutions, a copy of which
is attached hereto, establishing and providing for the issuance of
a series of Preferred Stock designated as Series 8 Class
H Convertible Preferred Stock and has established and fixed
the voting powers, designations, preferences and relative
participating, optional and other special rights and qualifications, limitations and restrictions of such Series 8
Class H Convertible Preferred Stock as set forth in the
attached resolutions.

Dated: April 30, 1998

                                                                                           PERMA-FIX ENVIRONMENTAL

                                                                                           SERVICES, INC.



                                                                                           By /s/ Louis Centofanti                           

                                                                                                 Dr. Louis F. Centofanti

                                                                                                 Chairman of the Board
ATTEST:


/s/ Richard T. Kelecy                               

Richard T. Kelecy, Secretary
 

 

 

PERMA-FIX ENVIRONMENTAL SERVICES, INC.

(the "Corporation")

RESOLUTION OF THE BOARD OF DIRECTORS


FIXING THE NUMBER AND DESIGNATING THE RIGHTS,
PRIVILEGES,

RESTRICTIONS AND CONDITIONS ATTACHING TO THE

SERIES 8 CLASS H CONVERTIBLE PREFERRED STOCK



          WHEREAS, the Corporation's capital includes preferred
stock, par value $.001 per share ("Preferred Stock"), which
Preferred Stock may be issued in one or more series by resolutions adopted
by the directors, and with the directors being entitled by
resolution to fix the number of shares in each series and to designate
the rights, designations, preferences and relative,
participating, optional or other special rights and privileges, restrictions
and conditions attaching to the shares of each such
series;

          WHEREAS, it is in the best interests of the Corporation
for the Board to create a new series from the Preferred
Stock designated as the Series 8 Class H Convertible Preferred Stock,
par value $.001 per share (the "Series 8 Class H Preferred
Stock");

          NOW, THEREFORE, BE IT
RESOLVED, that the Series 8 Class
H Preferred Stock shall consist of two thousand five hundred
(2,500) shares and no more and shall be designated as the Series 8 Class
H Convertible Preferred Stock, and the preferences,
rights, privileges, restrictions and conditions attaching to the Series
8 Class H Preferred Stock shall be as follows:

 Part 1 - Voting and Preemptive Rights.

1.1     Voting Rights. Except as otherwise provided in
Part 7 hereof or under Section 242(b)(2) of the General
Corporation Law of the State of Delaware (the "GCL"),
the holders of the Series 8 Class H Preferred Stock shall
have no voting rights whatsoever. To the extent that under Section 242(b)(2) of the GCL or Part 7 hereof,
the holders of the Series 8 Class H Preferred Stock are
entitled to vote on a matter, each share of the Series
8 Class H Preferred Stock shall be entitled one (1)
vote for each outstanding share of Series 8 Class H
Preferred Stock. Holders of the Series 8 Class H Preferred
Stock shall be entitled to notice of (and copies of proxy
materials and other information sent to stockholders)
for all shareholder meetings or written consents with
respect to which they would be entitled to vote, which notice
would be provided pursuant to the Corporation's
bylaws and applicable statutes.

1.2     No Preemptive Rights. The Series 8 Class H
Preferred Stock shall not give its holders any
preemptive rights to acquire any other securities issued by the
Corporation at any time in the future. 

 

-1-
 
Part 2 - Liquidation Rights.

2.1     Liquidation. If the Corporation shall be
voluntarily or involuntarily liquidated, dissolved or wound up at any time when any shares of the Series 8
Class H Preferred Stock shall be outstanding, the
holders of the then outstanding Series 8 Class H Preferred
Stock shall have a preference in distribution of the Corporation's property available for distribution to
the holders of the Corporation's Common Stock equal to
$1,000 consideration per outstanding share of Series 8 Class
H Preferred Stock, plus an amount equal to all unpaid
dividends accrued thereon to the date of payment of
such distribution ("Liquidation Preference"), whether or
not declared by the Board.

2.2     Payment of Liquidation
Preferences. Subject to
the provisions of Part 6 hereof, all amounts to be paid
as Liquidation Preference to the holders of Series 8
Class H Preferred Stock, as provided in this Part 2, shall
be paid or set apart for payment before the payment or
setting apart for payment of any amount for, or the distribution of any of the Corporation's property to
the holders of the Corporation's Common Stock, whether now
or hereafter authorized, in connection with such liquidation, dissolution or winding up.

2.3     No Rights After Payment. After the payment to the
holders of the shares of the Series 8 Class H
Preferred Stock of the full Liquidation Preference amounts
provided for in this Part 2, the holders of the Series 8 Class
H Preferred Stock as such shall have no right or claim
to any of the remaining assets of the Corporation.

2.4     Assets Insufficient to Pay Full Liquidation
Preference. In the event that the assets of the
Corporation available for distribution to the holders
of shares of the Series 8 Class H Preferred Stock upon
any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, shall
be insufficient to pay in full all amounts to which such
holders are entitled pursuant to this Part 2, no such distribution shall be made on account of any shares
of any other class or series of Preferred Stock ranking
on a parity with the shares of this Series 8 Class H Preferred Stock upon such dissolution, liquidation or
winding up unless proportionate distributive amounts shall be paid on account of the shares of this Series
8 Class H Preferred Stock and shares of such other class
or series ranking on a parity with the shares of this
Series 8 Class H Preferred Stock, ratably, in proportion to
the full distributable amounts for which holders of all
such parity shares are respectively entitled upon such
dissolution, liquidation or winding up.

Part 3 - Dividends. The holders of the Series 8 Class
H Preferred Stock are entitled to receive if, when and
as declared by the Board out of funds legally available
therefor, cumulative dividends, payable in cash or
Common Stock of the Corporation, par value $.001 per share
(the "Common Stock"), or any combination thereof, at the
Corporation's election, at the rate of four percent
(4%)

 

-2-
 
per annum of the Liquidation Value (as defined below)
of each issued and outstanding share of Series 8 Class H
Preferred Stock (the "Dividend Rate"). The
Liquidation Value of the Series 8 Class H Preferred Stock shall
be $1,000 per outstanding share of the Series 8 Class H
Preferred Stock (the "Liquidation Value"). The
dividend is payable semi-annually within seven (7) business
days after each of December 31 and June 30 of each year,
commencing June 30, 1998 (each, a "Dividend
Declaration Date"). Dividends shall be paid only with respect to
shares of Series 8 Class H Preferred Stock actually issued and outstanding on a Dividend Declaration Date
and to holders of record of the Series 8 Class H
Preferred Stock as of the Dividend Declaration Date. Dividends
shall accrue from the first day of the semi-annual
period in which such dividend may be payable, except with
respect to the first semi-annual dividend which shall accrue from March 1, 1998. In the event that the
Corporation elects to pay the accrued dividends due as
of a Dividend Declaration Date on an outstanding share
of the Series 8 Class H Preferred Stock in Common Stock
of the Corporation, the holder of such share shall
receive that number of shares of Common Stock of the
Corporation equal to the product of (a) the quotient of (i) the
Dividend Rate divided by (ii) the average of the
closing bid quotation of the Corporation's Common Stock as
reported on the National Association of Securities Dealers Automated Quotation system ("NASDAQ"), or the
average closing sale price if listed on a national securities exchange, for the five (5) trading days
immediately prior to the Dividend Declaration Date
(the "Stock Dividend Price"), times (b) a fraction, the
numerator of which is the number of days elapsed
during the period for which the dividend is to be paid and
the denominator of which is 365. Dividends on the Series
8 Class H Preferred Stock shall be cumulative, and no
dividends or other distributions shall be paid or declared or set aside for payment on the
Corporation's Common Stock until all accrued and unpaid dividends
on all outstanding shares of Series 8 Class H Preferred
Stock shall have been paid or declared and set aside
for payment.

Part 4 - Conversion. The holders of the Series 8
Class H Preferred Stock shall have rights to convert the
shares of Series 8 Class H Preferred Stock into shares of
the Corporation's Common Stock, par value $.001 per share
("Common Stock"), as follows (the "Conversion
Rights"):

4.1     Right to Convert. The Series 8 Class H Preferred
Stock shall be convertible into shares of Common Stock
at any time.

4.2     Conversion Price. Subject to the terms hereof, as
used herein, the Conversion Price per outstanding
share of Series 8 Class H Preferred Stock shall be $1.8125,
except that, in the event the average closing bid
price per share of the Common Stock as reported on the
over-the-counter market, or the closing sale price if
listed on a national securities exchange, for the five (5)
trading days prior to the particular date of
conversion shall be less than $2.265, the Conversion Price for
only such particular conversion shall be the product of
the average closing bid quotation of the Common Stock
as

 

-3-
 
reported on the over-the-counter market, or the
closing sale price if listed on a national securities
exchange, for the five (5) trading days immediately preceding
the date of the Conversion Notice referred to in Section
4.3 below in connection with such conversion multiplied
by eighty percent (80%). Notwithstanding the foregoing,
the Conversion Price shall not be less than a minimum of
$.75 per share ("Minimum Conversion Price"), which Minimum
Conversion Price shall be eliminated from and after September 6, 1998. If any of the outstanding shares
of Series 8 Class H Preferred Stock are converted, in
whole or in part, into Common Stock pursuant to the terms
of this Part 4, the number of shares of whole Common
Stock to be issued to the holder as a result of such
conversion shall be determined by dividing (a) the aggregate
Liquidation Value of the Series 8 Class H Preferred
Stock so surrendered for conversion by (b) the Conversion
Price as of such conversion. At the time of conversion of
shares of the Series 8 Class H Preferred Stock, the Corporation shall pay in cash to the holder thereof
an amount equal to all unpaid and accrued dividends, if
any, accrued thereon to the date of conversion, or, at the
Corporation's option, in lieu of paying cash for the accrued and unpaid dividends, issue that number of
whole shares of Common Stock which is equal to the quotient
of the amount of such unpaid and accrued dividends to
the date of conversion on the shares of Series 8 Class H
Preferred Stock so converted divided by the Stock Dividend Price, as defined in Part 3 hereof, in effect
at the date of conversion.

4.3     Mechanics of Conversion. Any holder of the Series
8 Class H Preferred Stock who wishes to exercise its Conversion Rights pursuant to Section 4.1 of this Part
4 must, if such shares are not being held in escrow by
the Corporation's attorneys, surrender the certificate
therefor at the principal executive office of the Corporation, and give written notice, which may be
via facsimile transmission, to the Corporation at such
office that it elects to convert the same (the "Conversion
Notice"). In the event that the shares of Series 8
Class H Preferred Stock are being held in escrow by the
Corporation's attorneys, no delivery of the
certificates shall be required. The Corporation shall, within five
(5) business days after receipt of an appropriate and timely Conversion Notice (and certificate, if
necessary), issue to such holder of Series 8 Class H Preferred
Stock or its agent a certificate for the number of shares
of Common Stock to which he shall be entitled; it being
expressly agreed that until and unless the holder delivers written notice to the Corporation to the
contrary, all shares of Common Stock issuable upon conversion of the Series 8 Class H Preferred Stock
hereunder are to be delivered by the Corporation to a party designated in writing by the holder in the
Conversion Notice for the account of the holder and
such shall be deemed valid delivery to the holder of such
shares of Common Stock. Such conversion shall be
deemed to have been made only after both the certificate for
the shares of Series 8 Class H Preferred Stock to be converted have been surrendered and the Conversion
Notice is received by the Corporation (or in the event that
no surrender of the Certificate is required, then only
upon the receipt by the Corporation of the Conversion
Notice)

 
-4-
 
(the "Conversion Documents"), and the person or
entity whose name is noted on the certificate evidencing
such shares of Common Stock issuable upon such conversion
shall be treated for all purposes as the record holder
of such shares of Common Stock at and after such time.
In the event that the Conversion Notice is sent via facsimile transmission, the Corporation shall be
deemed to have received such Conversion Notice on the first
business day on which such facsimile Conversion Notice
is actually received. If the Corporation fails to
deliver to the holder or its agent the certificate
representing the shares of Common Stock that the holder is entitled
to receive as a result of such conversion of the Series
8 Class H Preferred Stock within seven (7) business
days after receipt by the Corporation from the holder of
an appropriate and timely Conversion Notice and
certificates pursuant to the terms of this Section 4.3 ("Seven (7)
Business Day Period"), then, upon the written demand
of RBB Bank Aktiengesellschaft ("RBB Bank"), the holder
of the Series 8 Class H Preferred Stock, for payment of
the penalty described below in this Section 4.3, which
demand must be received by the Corporation no later than ten
(10) calendar days after the expiration of such Seven
(7) Business Day Period, the Corporation shall pay to RBB
Bank the following penalty for each business day
after the Seven (7) Business Day Period until the
Corporation delivers to the holder or its agent the certificate
representing the shares of Common Stock that the
holder is entitled to receive as a result of such
conversion: business day eight (8) - U.S. $1,000; business day
nine (9) - U.S. $2,000, and each business day thereafter
an amount equal to the penalty due on the immediately
preceding business day times two (2) until the Corporation delivers to the holder or its agent the
certificate representing the shares of Common Stock
that the holder is entitled to receive as a result of such
conversion.

4.4     Merger or Consolidation. In case of either (a)
any merger or consolidation to which the Corporation is a
party (collectively, the "Merger"), other than a
Merger in which the Corporation is the surviving or
continuing corporation, or (b) any sale or conveyance to another
corporation of all, or substantially all, of the
assets of the Corporation (collectively, the "Sale"), and
such Merger or Sale becomes effective (x) while any shares
of Series 8 Class H Preferred Stock are outstanding and
prior to the date that the Corporation's Registration Statement covering up to 1,379,311 shares of Common
Stock issuable upon the conversion of the Series 8 Class H
Preferred Stock is declared effective by the U. S. Securities and Exchange Commission or (y) prior to
the end of the restriction periods in Section 4.1, then,
in such event, the Corporation or such successor corporation, as the case may be, shall make
appropriate provision so that the holder of each share of Series
8 Class H Preferred Stock then outstanding shall have
the right to convert such share of Series 8 Class H
Preferred Stock into the kind and amount of shares of stock or
other securities and property receivable upon such
Merger or Sale by a holder of the number of shares of Common
Stock into which such shares of Series 8 Class H Preferred Stock could have been converted into

 
-5-
 
immediately prior to such Merger or Sale, subject to adjustments which shall be as nearly equivalent as may
be practicable to the adjustments provided for in this
Part 4.

4.5     Adjustments to Conversion Price for Stock
Dividends and for Combinations or Subdivisions of Common
Stock.
If the Corporation at any time or from time to time
while shares of Series 8 Class H Preferred Stock are issued
and outstanding shall declare or pay, without
consideration, any dividend on the Common Stock payable in Common
Stock, or shall effect a subdivision of the outstanding
shares of Common Stock into a greater number of shares of
Common Stock (by stock split, reclassification or otherwise
than by payment of a dividend in Common Stock or in any
right to acquire Common Stock), or if the outstanding shares
of Common Stock shall be combined or consolidated, by
reclassification or otherwise, into a lesser number
of shares of Common Stock, then the Conversion Price in
effect immediately before such event shall,
concurrently with the effectiveness of such event, be
proportionately decreased or increased, as appropriate.

 

4.6     Adjustments for Reclassification and
Reorganization. If the Common Stock issuable upon conversion of the
Series 8 Class H Preferred Stock shall be changed
into the same or a different number of shares of any other
class or classes of stock, whether by capital reorganization, reclassification or otherwise (other
than a subdivision or combination of shares provided for
in Section 4.4 hereof), the Conversion Price shall, concurrently with the effectiveness of such
reorganization or reclassification, be
proportionately adjusted so that the Series 8 Class H Preferred Stock
shall be convertible into, in lieu of the number of shares of Common Stock which the holders of Series 8
Class H Preferred Stock would otherwise have been entitled to receive, a number of shares of such other
class or classes of stock equivalent to the number of shares of Common Stock that would have been subject
to receipt by the holders upon conversion of the Series
8 Class H Preferred Stock immediately before that
change.

4.7     Common Stock Duly Issued. All Common Stock which
may be issued upon conversion of Series 8 Class H Preferred Stock will, upon issuance, be duly issued,
fully paid and nonassessable and free from all taxes, liens, and charges with respect to the issue
thereof.

4.8      Notice of Adjustments. Upon the occurrence of
each adjustment or readjustment of any Conversion Price
pursuant to this Part 4, the Corporation, at its
expense, within a reasonable period of time, shall compute
such adjustment or readjustment in accordance with the
terms hereof and prepare and furnish to each holder of
Series 8 Class H Preferred Stock a notice setting forth such
adjustment or readjustment and showing in detail the facts upon which such adjustment is based.

 
-6-
 
4.9     Issue Taxes. The Corporation shall pay any and
all issue and other taxes that may be payable in respect
of any issue or delivery of shares of Common Stock on
conversion of the Series 8 Class H Preferred Stock pursuant thereto; provided, however, that the
Corporation shall not be obligated to pay any transfer taxes
resulting from any transfer requested by any holder
of Series 8 Class H Preferred Stock in connection with
such conversion.

4.10     Reservation of Stock Issuable Upon
Conversion.
The Corporation shall at all times reserve and keep
available out of its authorized but unissued shares of Common
Stock, solely for the purpose of effecting the
conversion of the shares of the Series 8 Class H Preferred
Stock, such number of its shares of Common Stock as shall,
from time to time, be sufficient to effect the conversion
of all outstanding shares of the Series 8 Class H
Preferred stock, and, if at any time, the number of authorized
but unissued shares of Common Stock shall not be
sufficient to effect the conversion of all then outstanding
shares of the Series 8 Class H Preferred Stock, the
Corporation will take such corporate action as may be necessary
to increase its authorized but unissued shares of Common
Stock to such number of shares as shall be sufficient
for such purposes, including, without limitation, engaging
in reasonable efforts to obtain the requisite
stockholder approval of any necessary amendment to its Certificate
of Incorporation.

4.11     Fractional Shares. No fractional shares shall be
issued upon the conversion of any share or shares of Series 8 Class H Preferred Stock. All shares of
Common Stock (including fractions thereof) issuable upon
conversion of more than one share of Series 8 Class H Preferred Stock by a holder thereof shall be
aggregated for purposes of determining whether the conversion
would result in the issuance of any fractional share. If,
after the aforementioned aggregation, the conversion would result in the issuance of a fractional share of
Common Stock, such fractional share shall be rounded
up to the nearest whole share.

4.12     Notices. Any notices required by the provisions
of this Part 4 to be given to the holders of shares of
Series 8 Class H Preferred Stock shall be deemed given
if deposited in the United States mail, postage prepaid,
and addressed to each holder of record at his address
appearing on the books of the Corporation.

4.13     Business Day. As used herein, the term "business
day" shall mean any day other than a Saturday, Sunday
or a day when the federal and state banks located in the
State of New York are required or is permitted to
close.

Part 5 - Redemption.

5.1     Redemption at Corporation's
Option. Except as otherwise provided in this Section 5.1, at any time,
and from time to time, after the expiration of one (1)
year from June 9, 1997, the Corporation may, at its sole
option, but shall not be obligated to, redeem, in
whole

 
-7-

or in part, at any time, and from time to time, the
then outstanding Series 8 Class H Preferred Stock at the
following cash redemption prices per share (the "Redemption Price") if redeemed during the following
periods: (a) within four years from June 9, 1997 -
$1,300 per share, if at any time during such four year
period the average of the closing bid price of the Common
Stock for ten consecutive trading days shall be in excess
of Four Dollars ($4.00) per share, and (b) after four
years from June 9, 1997 - $1,000 per share.

5.2     Mechanics of Redemption. Thirty days prior to any
date stipulated by the Corporation for the redemption
of Series 8 Class H Preferred Stock (the "Redemption
Date"), written notice (the "Redemption Notice") shall be
mailed to each holder of record on such notice date of the
Series 8 Class H Preferred Stock. The Redemption
Notice shall state: (i) the Redemption Date of such shares,
(ii) the number of Series 8 Class H Preferred Stock to be
redeemed from the holder to whom the Redemption Notice
is addressed, (iii) instructions for surrender to the
Corporation, in the manner and at the place
designated, of a share certificate or share certificates
representing the number of Series 8 Class H Preferred Stock to be
redeemed from such holder, and (iv) instructions as
to how to specify to the Corporation the number of Series
8 Class H Preferred Stock to be redeemed as provided in
this Part 5 and, if the Redemption Notice is mailed
to the Holder after the first 180 days from the date of
issuance of the Series 8 Class H Preferred Stock, the number of shares to be converted into Common Stock as
provided in Part 4 hereof.

5.3    Rights of Conversion Upon
Redemption. If the redemption occurs after the first 180 days after the
first issuance of Series 8 Class H Preferred Stock,
then, upon receipt of the Redemption Notice, any holder of
Series 8 Class H Preferred Stock shall have the
option, at its sole election, to specify what portion of its
Series 8 Class H Preferred Stock called for redemption
in the Redemption Notice shall be redeemed as provided
in this Part 5 or converted into Common Stock in the
manner provided in Part 4 hereof, except that,
notwithstanding any provision of such Part 4 to the contrary, such
holder shall have the right to convert into Common Stock
that number of Series 8 Class H Preferred Stock called for
redemption in the Redemption Notice.

5.4    Surrender of Certificates. On or before the
Redemption Date in respect of any Series 8 Class H Preferred Stock, each holder of such shares shall
surrender the required certificate or certificates representing such shares to the Corporation in the
manner and at the place designated in the Redemption Notice,
and upon the Redemption Date, the Redemption Price for
such shares shall be made payable, in the manner provided
in Section 5.6 hereof, to the order of the person whose
name appears on such certificate or certificates as the
owner thereof, and each surrendered share certificate shall
be canceled and retired. If a share certificate is surrendered and all the shares evidenced thereby are
not

 
-8-
 
being redeemed (as described below), the Corporation shall cause the Series 8 Class H Preferred Stock
which are not being redeemed to be registered in the names
of the persons or entity whose names appear as the owners
on the respective surrendered share certificates and
deliver such certificate to such person.

5.5     Payment. On the Redemption Date in respect of any
Series 8 Class H Preferred Stock or prior thereto,
the Corporation shall deposit with any bank or trust
company having a capital and surplus of at least $50,000,000,
as a trust fund, a sum equal to the aggregate Redemption
Price of all such shares called from redemption (less
the aggregate Redemption Price for those Series 8 Class H
Preferred Stock in respect of which the Corporation
has received notice from the holder thereof of its
election to convert Series 8 Class H Preferred Stock into
Common Stock), with irrevocable instructions and authority
to the bank or trust company to pay, on or after the Redemption Date, the Redemption Price to the
respective holders upon the surrender of their share
certificates.  The deposit shall constitute full payment for the
shares to their holders, and from and after the date of the
deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to
be shareholders with respect to such shares and shall
have no rights with respect thereto except the rights to
receive from the bank or trust company payments of
the Redemption Price of the shares, without interest,
upon surrender of their certificates thereof. Any funds so
deposited and unclaimed at the end of one year
following the Redemption Date shall be released or repaid to
the Corporation, after which the former holders of shares
called for redemption shall be entitled to receive payment of the Redemption Price in respect of their
shares only from the Corporation.

Part 6 - Parity with Other Shares of Series 8 Class H
Preferred Stock and Priority.

6.1     Rateable Participation. If any cumulative
dividends or return of capital in respect of Series 8 Class H
Preferred Stock are not paid in full, the owners of
all series of outstanding Preferred Stock shall
participate rateably in respect of accumulated dividends and
return of capital.

6.2     Ranking. For purposes of this resolution, any
stock of any class or series of the Corporation shall be
deemed to rank:

           6.2.1  Prior or senior to the shares of this
Series 8 Class H Preferred Stock either as to dividends or upon liquidation, if
the holders of such class or classes shall be entitled to the receipt of
dividends or of amounts distributable upon dissolution, liquidation or winding
up of the Corporation, whether voluntary or involuntary, as the case may be, in
preference or priority to the holders of shares of this Series 8 Class H Preferred
Stock;

 

-9-

         6.2.2  On a parity with, or equal to, shares of
this Series 8 Class H Preferred Stock, either as to dividends or upon
liquidation, whether or not the dividend rates, dividend payment dates, or
redemption or liquidation prices per share or sinking fund provisions, if any,
are different from those of this Series 8 Class H Preferred Stock, if the holders
of such stock are entitled to the receipt of dividends or of amounts distributable
upon dissolution, liquidation or winding up of the Corporation, whether voluntary
or involuntary, in proportion to their respective dividend rates or liquidation
prices, without preference or priority, one over the other, as between the
holders of such stock and over the other, as between the holders of such stock and
the holders of shares of this Series 8 Class H Preferred Stock; and,

        6.2.3  Junior to shares of this Series 8 Class H
Preferred Stock, either as to dividends or upon liquidation, if such class or
series shall be Common Stock or if the holders of shares of this Series 8 Class
H Preferred Stock shall be entitled to receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, as the case may be, in
preference or priority to the holders of shares of such class or series.

 
 

 

 

 

 

-10-
 
Part 7 - Amendment and Reissue.

7.1   Amendment. If any proposed amendment to the
Corporation's Certificate of Incorporation (the "Articles") would alter or change the powers,
preferences or special rights of the Series 8 Class H Preferred
Stock so as to affect such adversely, then the Corporation
must obtain the affirmative vote of such amendment to the
Articles at a duly called and held series meeting of
the holders of the Series 8 Class H Preferred Stock or
written consent by the holders of a majority of the Series 8 Class H Preferred Stock then outstanding. 
Notwithstanding the above or the provisions of
Section 242(b)(2) of the GCL, the number of authorized shares
of any class or classes of stock of the Corporation may
be increased or decreased (but not below the number of
shares thereof outstanding) by the affirmative vote
of the holders of a majority of the stock of the
Corporation entitled to vote thereon, voting together as a single
class, irrespective of the provisions of this Section
7.1 or Section 242(b)(2) of the GCL.

7.2    Authorized. Any shares of Series 8 Class H
Preferred Stock acquired by the Corporation by reason
of purchase, conversion, redemption or otherwise shall
be retired and shall become authorized but unissued
shares of Preferred Stock, which may be reissued as part of
a new series of Preferred Stock hereafter created.

 
 

 

 

 

 

-11-
 
CERTIFICATE OF DESIGNATIONS

OF SERIES 9 CLASS I CONVERTIBLE PREFERRED STOCK

OF

PERMA-FIX ENVIRONMENTAL SERVICES, INC.



          Perma-Fix Environmental Services, Inc. (the "Corporation"),
a corporation organized and existing under the General
Corporation Law of the State of Delaware, does hereby
certify:

          That, pursuant to authority conferred upon by the Board
of Directors by the Corporation's Restated Certificate
of Incorporation, as amended, and pursuant to the provisions
of Section 151 of the Delaware Corporation Law, the Board of
Directors of the Corporation has adopted resolutions, a copy of which
is attached hereto, establishing and providing for the issuance of
a series of Preferred Stock designated as Series 9 Class
I Convertible Preferred Stock and has established and fixed
the voting powers, designations, preferences and relative
participating, optional and other special rights and qualifications, limitations and restrictions of such Series 9
Class I Convertible Preferred Stock as set forth in the
attached resolutions.

Dated: April 30, 1998

                                                                                  PERMA-FIX ENVIRONMENTAL

                                                                                  SERVICES, INC.





                                                                                   By
 /s/ Louis Centofanti                                 


                                                                                        Dr. Louis F. Centofanti

                                                                                        Chairman of the Board
ATTEST:



/s/ Richard T. Kelecy                                  

Richard T. Kelecy, Secretary
 

 

STATE OF DELAWARE    

SECRETARY OF STATE     

DIVISION OF CORPORATIONS

FILED 01:32 PM 07/16/1998  

981277758 -- 2249849        

 

PERMA-FIX ENVIRONMENTAL SERVICES, INC.

(the "Corporation")



RESOLUTION OF THE BOARD OF DIRECTORS



FIXING THE NUMBER AND DESIGNATING THE RIGHTS,
PRIVILEGES,

RESTRICTIONS AND CONDITIONS ATTACHING TO THE

SERIES 9 CLASS I CONVERTIBLE PREFERRED STOCK



          WHEREAS, the Corporation's capital includes preferred
stock, par value $.001 per share ("Preferred Stock"), which
Preferred Stock may be issued in one or more series by resolutions adopted
by the directors, and with the directors being entitled by
resolution to fix the number of shares in each series and to designate
the rights, designations, preferences and relative,
participating, optional or other special rights and privileges, restrictions
and conditions attaching to the shares of each such
series;

          WHEREAS, it is in the best interests of the Corporation
for the Board to create a new series from the Preferred
Stock designated as the Series 9 Class I Convertible Preferred Stock,
par value $.001 per share (the "Series 9 Class I Preferred
Stock");

          NOW, THEREFORE, BE IT
RESOLVED, that the Series 9 Class
I Preferred Stock shall consist of three hundred (350) shares and
no more and shall be designated as the Series 9 Class I
Convertible Preferred Stock, and the preferences, rights,
privileges, restrictions and conditions attaching to the Series 9 Class
I Preferred Stock shall be as follows:

Part 1 - Voting and Preemptive Rights.

1.1     Voting Rights.  Except as otherwise provided in Part 7
hereof  or under Section 242(b)(2) of the General Corporation Law of
the State of Delaware (the "GCL"), the holders of the Series 9 Class
I Preferred Stock shall have no voting rights whatsoever. To
the extent that under Section 242(b)(2) of the GCL or Part 7
hereof, the holders of the Series 9 Class I Preferred Stock are entitled
to vote on a matter, each share of the Series 9 Class I
Preferred Stock shall be entitled one (1) vote for each outstanding share
of Series 9 Class I Preferred Stock. Holders of the Series 9 Class
I Preferred Stock shall be entitled to notice of (and copies of
proxy materials and other information sent to stockholders) for
all shareholder meetings or written consents with respect to which
they would be entitled to vote, which notice would be provided
pursuant to the Corporation's bylaws and applicable statutes. If
the holders of the Series 9 Class I Preferred Stock are required
to vote under Section 242(b)(2) of the GCL as a result of the
number of authorized shares of any such class or classes of stock
being increased or decreased, the number of authorized shares of any
of such class or classes of stock may be increased or decreased
(but not below the number of shares thereof then outstanding) by
the affirmative vote of the holders of a majority of the stock of
the Corporation entitled to vote thereon, irrespective of
the provisions of Section 242(b)(2) of the GCL.

 
-1-
 
1.2     No Preemptive Rights. The Series 9 Class I Preferred
Stock shall not give its holders any preemptive rights to acquire
any other securities issued by the Corporation at any time in
the future.

Part 2 - Liquidation Rights.

2.1     Liquidation. If the Corporation shall be voluntarily
or involuntarily liquidated, dissolved or wound up at any time
when any shares of the Series 9 Class I Preferred Stock shall
be outstanding, the holders of the then outstanding Series 9 Class
I Preferred Stock shall be entitled to receive out of the assets
of the Corporation available for distribution to shareholders
an amount equal to $1,000 consideration per outstanding share
of Series 9 Class I Preferred Stock, and no more, plus an amount
equal to all unpaid dividends accrued thereon to the date of payment
of such distribution ("Liquidation Preference"), whether or
not declared by the Board of Directors, before any payment shall
be made or any assets distributed to the holders of the
Corporation's Common Stock.

2.2     Payment of Liquidation
Preferences. Subject to the
provisions of Part 6 hereof, all amounts to be paid as Liquidation
Preference to the holders of Series 9 Class I Preferred Stock, as provided
in this Part 2, shall be paid or set apart for payment before
the payment or setting apart for payment of any amount for, or
the distribution of any of the Corporation's property to the holders
of the Corporation's Common Stock, whether now or
hereafter authorized, in connection with such liquidation, dissolution
or winding up.

2.3     No Rights After Payment. After the payment to the holders
of the shares of the Series 9 Class I Preferred Stock of the
full Liquidation Preference amounts provided for in this Part 2,
the holders of the Series 9 Class I Preferred Stock as such shall
have no right or claim to any of the remaining assets of
the Corporation. 

2.4     Assets Insufficient to Pay Full Liquidation
Preference.
In the event that the assets of the Corporation available
for distribution to the holders of shares of the Series 9 Class
I Preferred Stock upon any dissolution, liquidation or winding up
of the Corporation, whether voluntary or involuntary, shall
be insufficient to pay in full all amounts to which such holders
are entitled pursuant to this Part 2, no such distribution shall
be made on account of any shares of any other class or series
of Preferred Stock ranking on a parity with the shares of this
Series 9 Class I Preferred Stock upon such dissolution, liquidation
or winding up unless proportionate distributive amounts shall be
paid on account of the shares of this Series 9 Class I Preferred
Stock and shares of such other class or series ranking on a parity
with the shares of this Series 9 Class I Preferred Stock, ratably,
in proportion to the full distributable amounts for which holders
of all such parity shares are respectively entitled upon
such dissolution, liquidation or winding up.

Part 3 - Dividends.

3.1     The holders of the Series 9 Class I Preferred Stock
are entitled to receive if, when and as declared by the Board
of Directors of the Corporation (the "Board") out of funds
legally

 
-2-
 
available therefor, cumulative annual dividends, payable in cash
or Common Stock of the Corporation, par value $.001 per share
(the "Common Stock"), or any combination thereof, at the
Corporation's election, at the rate of four percent (4%) per annum of
the Liquidation Value (as defined below) of each issued and outstanding
share of Series 9 Class I Preferred Stock (the "Dividend
Rate"). The Liquidation Value of the Series 9 Class I Preferred Stock
shall be $1,000 per outstanding share of the Series 9 Class I
Preferred Stock (the "Liquidation Value"). The dividend is payable
semi-annually within seven (7) business days after each of December
31 and June 30 of each year, commencing June 30, 1998 (each,
a "Dividend Declaration Date"). Dividends shall be paid only
with respect to shares of Series 9 Class I Preferred Stock
actually issued and outstanding on a Dividend Declaration Date and
to holders of record of the Series 9 Class I Preferred Stock as of
the Dividend Declaration Date. Dividends shall accrue from the
first day of the semi-annual period in which such dividend may
be payable, except with respect to the first semi-annual
dividend which shall accrue from March 1, 1998. In the event that
the Corporation elects to pay the accrued dividends due as of
a Dividend Declaration Date on an outstanding share of the Series
9 Class I Preferred Stock in Common Stock of the Corporation,
the holder of such share shall receive that number of shares of
Common Stock of the Corporation equal to the product of (a) the
quotient of (i) the Dividend Rate divided by (ii) the average of the
closing bid quotation of the Corporation's Common Stock as reported on
the National Association of Securities Dealers Automated
Quotation system ("NASDAQ"), or the average closing sale price if listed
on a national securities exchange, for the five (5) trading
days immediately prior to the Dividend Declaration Date (the
"Stock Dividend Price"), times (b) a fraction, the numerator of which
is the number of days elapsed during the period for which the
dividend is to be paid and the denominator of which is 365. Dividends
on the Series 9 Class I Preferred Stock shall be cumulative, and
no dividends or other distributions shall be paid or declared or
set aside for payment on the Corporation's Common Stock until
all accrued and unpaid dividends on all outstanding shares of Series
9 Class I Preferred Stock shall have been paid or declared and
set aside for payment.

Part 4 - Conversion. The holders of the Series 9 Class I
Preferred Stock shall have rights to convert the shares of Series 9 Class
I Preferred Stock into shares of the Corporation's Common Stock,
as follows (the "Conversion Rights"):

4.1     Right to Convert. The Series 9 Class I Preferred Stock
shall be convertible into shares of Common Stock at any
time.

4.2     Conversion Price. Subject to the terms hereof, as
used herein, the Conversion Price per outstanding share of
Series 9 Class I Preferred Stock shall be $1.8125, except that,
in the event the average closing bid price per share of
the Common Stock as reported on the over-the-counter market,
or the closing sale price if listed on a national
securities exchange, for the five (5) trading days prior to the
particular date of conversion shall be less than $2.265,
the Conversion Price for only such particular conversion shall
be the product of the average closing bid quotation of the
Common Stock as reported on the over-the-counter market, or
the closing sale price if listed on a national securities
exchange, for the five (5) trading days immediately
preceding the date of the Conversion Notice referred to in Section
4.3 below in connection with such conversion multiplied by
eighty

 
-3-
 
percent (80%). Notwithstanding the foregoing, the
Conversion Price shall not be less than a minimum of $.75 per
share ("Minimum Conversion Price"), which Minimum Conversion
Price shall be eliminated from and after September 6, 1998. If
any of the outstanding shares of Series 9 Class I Preferred
Stock are converted, in whole or in part, into Common Stock
pursuant to the terms of this Part 4, the number of shares of
whole Common Stock to be issued to the holder as a result of
such conversion shall be determined by dividing (a) the
aggregate Liquidation Value of the Series 9 Class I Preferred Stock
so surrendered for conversion by (b) the Conversion Price as
of such conversion. At the time of conversion of shares of
the Series 9 Class I Preferred Stock, the Corporation shall pay
in cash to the holder thereof an amount equal to all unpaid
and accrued dividends, if any, accrued thereon to the date
of conversion, or, at the Corporation's option, in lieu of
paying cash for the accrued and unpaid dividends, issue that
number of whole shares of Common Stock which is equal to the
quotient of the amount of such unpaid and accrued dividends to the
date of conversion on the shares of Series 9 Class I
Preferred Stock so converted divided by the Stock Dividend Price,
as defined in Part 3 hereof, in effect at the date of
conversion.

4.3     Mechanics of Conversion. Any holder of the Series 9 Class
I Preferred Stock who wishes to exercise its Conversion
Rights pursuant to Section 4.1 of this Part 4 must surrender
the certificate therefor at the principal executive office of
the Corporation, and give written notice, which may be
via facsimile transmission, to the Corporation at such office
that it elects to convert the same (the "Conversion Notice").
The Corporation shall, within seven (7) business days
after receipt of an appropriate and timely Conversion Notice
(and certificate, if necessary), issue to such holder of Series
9 Class I Preferred Stock or its agent a certificate for
the number of shares of Common Stock to which he shall be
entitled; it being expressly agreed that until and unless
the holder delivers written notice to the Corporation to
the contrary, all shares of Common Stock issuable upon
conversion of the Series 9 Class I Preferred Stock hereunder are to
be delivered by the Corporation to a party designated in
writing by the holder in the Conversion Notice for the account of
the holder and such shall be deemed valid delivery to the
holder of such shares of Common Stock. Such conversion shall
be deemed to have been made only after both the certificate
for the shares of Series 9 Class I Preferred Stock to be
converted have been surrendered and the Conversion Notice is received
by the Corporation (the "Conversion Documents"), and the
person or entity whose name is noted on the certificate
evidencing such shares of Common Stock issuable upon such
conversion shall be treated for all purposes as the record holder of
such shares of Common Stock at and after such time. In the
event that the Conversion Notice is sent via facsimile
transmission, the Corporation shall be deemed to have received such
Conversion Notice on the first business day on which
such facsimile Conversion Notice is actually
received.

4.4     Merger or Consolidation. In case of either (a) any merger
or consolidation to which the Corporation is a party (collectively, the "Merger"), other than a Merger in which
the Corporation is the surviving or continuing corporation, or
(b) any sale or conveyance to another corporation of all,
or substantially all, of the assets of the
Corporation

 

-4-
 
(collectively, the "Sale"), and such Merger or Sale
becomes effective (x) while any shares of Series 9 Class I
Preferred Stock are outstanding and prior to the date that the
Corporation's Registration Statement covering up to
200,000 shares of Common Stock issuable upon the conversion of
the Series 9 Class I Preferred Stock is declared effective by
the U. S. Securities and Exchange Commission or (y) prior to
the end of the restriction periods in Section 4.1, then, in
such event, the Corporation or such successor corporation, as
the case may be, shall make appropriate provision so that
the holder of each share of Series 9 Class I Preferred Stock
then outstanding shall have the right to convert such share
of Series 9 Class I Preferred Stock into the kind and amount
of shares of stock or other securities and property
receivable upon such Merger or Sale by a holder of the number of
shares of Common Stock into which such shares of Series 9 Class
I Preferred Stock could have been converted into
immediately prior to such Merger or Sale, subject to adjustments
which shall be as nearly equivalent as may be practicable to
the adjustments provided for in this Part 4.

4.5    Adjustments to Conversion Price for Stock Dividends and
for Combinations or Subdivisions of Common
Stock. If the Corporation at any time or from time to time while shares
of Series 9 Class I Preferred Stock are issued and
outstanding shall declare or pay, without consideration, any dividend
on the Common Stock payable in Common Stock, or shall effect
a subdivision of the outstanding shares of Common Stock into
a greater number of shares of Common Stock (by stock
split, reclassification or otherwise than by payment of a dividend
in Common Stock or in any right to acquire Common Stock), or
if the outstanding shares of Common Stock shall be combined
or consolidated, by reclassification or otherwise, into a
lesser number of shares of Common Stock, then the Conversion Price
in effect immediately before such event shall, concurrently
with the effectiveness of such event, be proportionately
decreased or increased, as appropriate.

4.6     Adjustments for Reclassification and
Reorganization. If
the Common Stock issuable upon conversion of the Series 9 Class
I Preferred Stock shall be changed into the same or a
different number of shares of any other class or classes of
stock, whether by capital reorganization, reclassification
or otherwise (other than a subdivision or combination of
shares provided for in Section 4.4 hereof), the Conversion Price
then in effect shall, concurrently with the effectiveness of
such reorganization or reclassification, be
proportionately adjusted so that the Series 9 Class I Preferred Stock shall
be convertible into, in lieu of the number of shares of
Common Stock which the holders of Series 9 Class I Preferred
Stock would otherwise have been entitled to receive, a number
of shares of such other class or classes of stock equivalent
to the number of shares of Common Stock that would have
been subject to receipt by the holders upon conversion of
the Series 9 Class I Preferred Stock immediately before
that change.

4.7     Common Stock Duly Issued. All Common Stock which may
be issued upon conversion of Series 9 Class I Preferred
Stock will, upon issuance, be duly issued, fully paid and
nonassessable and free from all taxes, liens, and charges
with respect to the issue thereof.

 

-5-
 
4.8     Notice of Adjustments. Upon the occurrence of each
adjustment or readjustment of any Conversion Price pursuant to this
Part 4, the Corporation, at its expense, within a reasonable
period of time, shall compute such adjustment or readjustment
in accordance with the terms hereof and prepare and furnish
to each holder of Series 9 Class I Preferred Stock a
notice setting forth such adjustment or readjustment and showing
in detail the facts upon which such adjustment is
based.

4.9     Issue Taxes. The Corporation shall pay any and all issue
and other taxes that may be payable in respect of any issue
or delivery of shares of Common Stock on conversion of the
Series 9 Class I Preferred Stock pursuant thereto; provided,
however, that the Corporation shall not be obligated to pay
any transfer taxes resulting from any transfer requested by
any holder of Series 9 Class I Preferred Stock in connection
with such conversion.

4.10     Reservation of Stock Issuable Upon
Conversion.
The Corporation shall at all times reserve and keep available
out of its authorized but unissued shares of Common Stock,
solely for the purpose of effecting the conversion of the shares
of the Series 9 Class I Preferred Stock, such number of
its shares of Common Stock as shall, from time to time,
be sufficient to effect the conversion of all outstanding
shares of the Series 9 Class I Preferred stock, and, if at any
time, the number of authorized but unissued shares of Common
Stock shall not be sufficient to effect the conversion of all
then outstanding shares of the Series 9 Class I Preferred
Stock, the Corporation will take such corporate action as may
be necessary to increase its authorized but unissued shares
of Common Stock to such number of shares as shall be
sufficient for such purposes, including, without limitation, engaging
in reasonable efforts to obtain the requisite
stockholder approval of any necessary amendment to its Certificate
of Incorporation.

4.11     Fractional Shares. No fractional shares shall be issued
upon the conversion of any share or shares of Series 9 Class
I Preferred Stock. All shares of Common Stock
(including fractions thereof) issuable upon conversion of more than
one share of Series 9 Class I Preferred Stock by a holder
thereof shall be aggregated for purposes of determining whether
the conversion would result in the issuance of any
fractional share. If, after the aforementioned aggregation, the
conversion would result in the issuance of a fractional share
of Common Stock, such fractional share shall be rounded up
to the nearest whole share.

4.12     Notices. Any notices required by the provisions of this
Part 4 to be given to the holders of shares of Series 9 Class
I Preferred Stock shall be deemed given if deposited in
the United States mail, postage prepaid, and addressed to
each holder of record at his address appearing on the books of
the Corporation.

4.13     Business Day. As used herein, the term "business day"
shall mean any day other than a Saturday, Sunday or a day when
the federal and state banks located in the State of New York
are required or is permitted to close.

 
-6-
 
Part 5 - Redemption.

5.1    Redemption at Corporation's Option. Except as
otherwise provided in this Section 5.1, at any time, and from time
to time, after the expiration of one (1) year from the date
of the first issuance of the Series 9 Class I Preferred
Stock, the Corporation may, at its sole option, but shall not
be obligated to, redeem, in whole or in part, at any time,
and from time to time, the then outstanding Series 9 Class
I Preferred Stock at the following cash redemption prices
per share (the "Redemption Price") if redeemed during
the following periods: (a) within four (4) years from the date
of the first issuance of Series 9 Class I Preferred Stock
- $1,300 per share, if at any time during such four (4)
year period the average of the closing bid price of the
Common Stock for ten (10) consecutive trading days shall be in
excess of Four U.S. Dollars ($4.00) per share, and (b) after four
(4) years from the date of the first issuance of Series 9 Class
I Preferred Stock - $1,000 per share.

5.2    Mechanics of Redemption. Thirty (30) days prior to any
date stipulated by the Corporation for the redemption of Series
9 Class I Preferred Stock (the "Redemption Date"),
written notice (the "Redemption Notice") shall be mailed to
each holder of record on such notice date of the Series 9 Class
I Preferred Stock. The Redemption Notice shall state: (i)
the Redemption Date of such shares, (ii) the number of Series
9 Class I Preferred Stock to be redeemed from the holder to
whom the Redemption Notice is addressed, (iii) instructions
for surrender to the Corporation, in the manner and at the
place designated, of a share certificate or share
certificates representing the number of Series 9 Class I Preferred Stock
to be redeemed from such holder, and (iv) instructions as to
how to specify to the Corporation the number of Series 9 Class
I Preferred Stock to be redeemed as provided in this Part
5.

5.3    Rights of Conversion Upon Redemption. If the
redemption occurs after the first one hundred eighty (180) days after
the first issuance of Series 9 Class I Preferred Stock, then,
upon receipt of the Redemption Notice, any holder of Series 9
Class I Preferred Stock shall have the option, at its sole
election, to specify what portion of its Series 9 Class I
Preferred Stock called for redemption in the Redemption Notice shall
be redeemed as provided in this Part 5 or converted into
Common Stock in the manner provided in Part 4 hereof.

5.4    Surrender of Certificates. On or before the Redemption
Date in respect of any Series 9 Class I Preferred Stock,
each holder of such shares shall surrender the required
certificate or certificates representing such shares to the Corporation
in the manner and at the place designated in the
Redemption Notice, and upon the Redemption Date, the Redemption Price
for such shares shall be made payable, in the manner provided
in Section 5.6 hereof, to the order of the person whose
name appears on such certificate or certificates as the
owner thereof. If a share certificate is surrendered and all
the shares evidenced thereby are not being redeemed (as
described below), the Corporation shall cause the Series 9 Class
I Preferred Stock which are not being redeemed to be
registered in the names of the persons or entity whose names appear
as the owners on the respective surrendered share
certificates and deliver such certificate to such person.

-7-

5.5    Payment. On the Redemption Date in respect of any Series
9 Class I Preferred Stock or prior thereto, the
Corporation shall deposit with any bank or trust company having a
capital and surplus of at least U. S. $50,000,000, as a trust fund,
a sum equal to the aggregate Redemption Price of all such
shares called from redemption (less the aggregate Redemption
Price for those Series 9 Class I Preferred Stock in respect of
which the Corporation has received notice from the holder thereof
of its election to convert Series 9 Class I Preferred Stock
into Common Stock), with irrevocable instructions and authority
to the bank or trust company to pay, on or after the
Redemption Date, the Redemption Price to the respective holders upon
the surrender of their share certificates. The deposit
shall constitute full payment for the shares to their holders,
and from and after the date of the deposit the redeemed
shares shall be deemed to be no longer outstanding, and
holders thereof shall cease to be shareholders with respect to
such shares and shall have no rights with respect thereto
except the rights to receive from the bank or trust company
payments of the Redemption Price of the shares, without interest,
upon surrender of their certificates thereof. Any funds
so deposited and unclaimed at the end of one year following
the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares
called for redemption shall be entitled to receive payment of
the Redemption Price in respect of their shares only from
the Corporation.

Part 6 - Parity with Other Shares of Series 9 Class I
Preferred Stock and Priority.

6.1    Rateable Participation. If any cumulative dividends or
return of capital in respect of Series 9 Class I Preferred Stock
are not paid in full, the owners of all series of
outstanding Preferred Stock shall participate rateably in respect
of accumulated dividends and return of capital.

6.2    Ranking. For purposes of this resolution, any stock of
any class or series of the Corporation shall be deemed to
rank:

          6.2.1  Prior or senior to the shares of this Series 9
Class I Preferred Stock either as to dividends

                    or upon liquidation, if the holders of such
class or classes shall be entitled to the receipt of

                    dividends or of amounts
distributable upon dissolution, liquidation or winding up of the

                   
Corporation, whether voluntary or involuntary, as the case may be, in preference or 

                    priority to the holders of
shares of this Series 9 Class I Preferred Stock;

          6.2.2  On a parity with, or equal to, shares of this
Series 9 Class I Preferred Stock, either as to

                     dividends or upon liquidation, whether or not
the dividend rates, dividend payment dates, 

                     or
redemption or liquidation prices per share or sinking fund provisions, if any, are 

                     different
from those of this Series 9 Class I Preferred Stock, if the holders of such stock 

                      are
entitled to the receipt of dividends or of amounts distributable upon dissolution, 

                      liquidation or winding up of the Corporation,
whether voluntary or involuntary, in 

                      proportion to their respective dividend rates

-8-
 
                      or liquidation prices, without preference or
priority, one over the other, as between 

                      the
holders of such stock and over the other, as between the holders of such stock 

                      and the
holders of shares of this Series 9 Class I Preferred Stock; and,

           6.2.3  Junior to shares of this Series 9 Class I
Preferred Stock, either as to dividends or upon

                    
liquidation, if such class or series shall be Common Stock or if the holders of shares 

                     of this Series 9 Class I Preferred
Stock shall be entitled to receipt of dividends or of 

                     amounts distributable upon
dissolution, liquidation or winding up of the Corporation, 

                     whether voluntary or involuntary,
as the case may be, in preference or priority to the 

                     holders of shares of such class or
series.

Part 7 - Reissue.

7.1     Authorized. Any shares of Series 9 Class I
Preferred Stock acquired by the Corporation by reason of
purchase, conversion, redemption or otherwise shall be retired
and shall become authorized but unissued shares of
Preferred Stock, which may be reissued as part of a new series
of Preferred Stock hereafter created.

 

 

 

 

 

 

 

 

-9-
 
STATE OF DELAWARE   

SECRETARY OF STATE   

DIVISION OF CORPORATIONS

FILED 12:30 PM 07/15/1999  

991291288 -- 2249849        



CERTIFICATE OF DESIGNATIONS

OF SERIES 11 CLASS K CONVERTIBLE PREFERRED STOCK

OF

PERMA-FIX ENVIRONMENTAL SERVICES, INC.


          Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation
organized and existing under the General Corporation Law of the State of
Delaware, does hereby certify:
           That, pursuant to authority conferred upon by the Board of Directors by the
Corporation's Restated Certificate of Incorporation, as amended, and pursuant to
the provisions of Section 151 of the Delaware Corporation Law, the Board of
Directors of the Corporation has adopted resolutions, a copy of which is
attached hereto, establishing and providing for the issuance of a series of
Preferred Stock designated as Series 11 Class K Convertible Preferred Stock and
has established and fixed the voting powers, designations, preferences and
relative participating, optional and other special rights and qualifications,
limitations and restrictions of such Series 11 Class K Convertible Preferred
Stock as set forth in the attached resolutions.

Dated: July 15, 1999                                    PERMA-FIX ENVIRONMENTAL SERVICES, INC.


                                                                     By /s/ Louis Centofanti                                                

                                                                           Dr. Louis F. Centofanti

                                                                           Chairman of the Board

ATTEST:



/s/ Richard T. Kelecy                            

Richard T. Kelecy, Secretary

 

 

 

 



PERMA-FIX ENVIRONMENTAL SERVICES, INC.

(the "Corporation")



RESOLUTION OF THE BOARD OF DIRECTORS

FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,

RESTRICTIONS AND CONDITIONS ATTACHING TO THE

SERIES 11 CLASS K CONVERTIBLE PREFERRED STOCK


WHEREAS,

A.    The Corporation's share capital includes Preferred Stock, par value $.001
per share 

        ("Preferred Stock"), which Preferred Stock may be issued in one or
more series by the 

        Board of Directors of the Corporation (the "Board") being
entitled by resolution to fix the 

        number of shares in each series and to
designate the rights, designations, preferences, and 

        relative, participating,
optional or other special rights, privileges, restrictions and conditions 

        attaching to the shares of each such series; and

B.    It is in the best interests of the Corporation for the Board to create a
new series from the 

       Preferred Stock designated as the Series 11 Class K
Convertible Preferred Stock, par value $.001.

NOW, THEREFORE, BE IT RESOLVED, THAT:

The Series 11 Class K Convertible Preferred Stock, par value $.001 (the
"Series 11 Class K Preferred Stock") of the Corporation shall consist of 1,769
shares and no more and shall be designated as the Series 11 Class K Convertible
Preferred Stock, and the preferences, rights, privileges, restrictions and
conditions attaching to the Series 11 Class K Preferred Stock shall be as
follows:

Part 1 - Voting and Preemptive Rights.

1.1    Voting Rights. Except as otherwise provided
herein, in the Corporation's Certificate of Incorporation (the "Articles") or
the General Corporation Law of the State of Delaware (the "GCL"), the holders of
the Series 11 Class K Preferred Stock shall have no voting rights whatsoever. To
the extent that under the GCL the vote of the holders of the Series 11 Class K
Preferred Stock, voting separately as a class or series as applicable, is
required to authorize a given action of the Corporation, the affirmative vote or
consent of the holders of at least a majority of the shares of the Series 11
Class K Preferred Stock represented at a duly held meeting at which a quorum is
present or by written consent of a majority of the shares of Series 11 Class K
Preferred Stock (except as otherwise may be required under the GCL) shall
constitute the approval  
 


-2-

 
 of such action by the series. To the extent that under the GCL the holders of the
Series 11 Class K Preferred Stock are entitled to vote on a matter with holders
of Corporation's Common Stock and/or any other class or series of the
Corporation's voting securities, the Series 11 Class K Preferred Stock, the
Corporation's Common Stock and all other classes or series of the Corporation's
voting securities shall vote together as one class, with each share of Series 11
Class K Preferred Stock entitled to a number of votes equal to the number of
shares of the Corporation's Common Stock into which it is then convertible using
the record date for the taking of such vote of stockholders as the date as of
which the Conversion Price (as defined in Section 4.2 hereof) is calculated and
conversion is effected. Holders of the Series 11 Class K Preferred Stock shall
be entitled to notice of (and copies of proxy materials and other information
sent to stockholders) for all shareholder meetings or written consents with
respect to which they would be entitled to vote, which notice would be provided
pursuant to the Corporation's bylaws and applicable statutes.

1.2    No Preemptive Rights. The Series 11 Class K
Preferred Stock shall not give its holders any preemptive rights to acquire any
other securities issued by the Corporation at any time in the future.

Part 2 - Liquidation Rights.

2.1    Liquidation. If the Corporation shall be
voluntarily or involuntarily liquidated, dissolved or wound up at any time when
any shares of the Series 11 Class K Preferred Stock shall be outstanding, the
holders of the then outstanding Series 11 Class K Preferred Stock shall have a
preference in distribution of the Corporation's property available for
distribution to the holders of the Corporation's Common Stock equal to $1,000
consideration per outstanding share of Series 11 Class K Preferred Stock, plus
an amount equal to all unpaid dividends accrued thereon to the date of payment
of such distribution ("Liquidation Preference"), whether or not declared by the
Board.

2.2    Payment of Liquidation Preferences. Subject to
the provisions of Part 6 hereof, all amounts to be paid as Liquidation
Preference to the holders of Series 11 Class K Preferred Stock, as provided in
this Part 2, shall be paid or set apart for payment before the payment or
setting apart for payment of any amount for, or the distribution of any of the
Corporation's property to the holders of the Corporation's Common Stock, whether
now or hereafter authorized, in connection with such liquidation, dissolution or
winding up.

2.3    No Rights After Payment. After the payment to the
holders of the shares of the Series 11 Class K Preferred Stock of the full
Liquidation Preference amounts provided for in this Part 2, the holders of the
Series 11 Class K Preferred Stock as such shall have no right or claim to any of
the remaining assets of the Corporation.

2.4    Assets Insufficient to Pay Full Liquidation
Preference. In the event that the assets of the Corporation
available for distribution to the holders of shares of the Series 11 Class K
Preferred Stock upon any dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, shall be 

  



-3-


insufficient to pay in full all amounts to which such holders are entitled
pursuant to this Part 2, no such distribution shall be made on account of any
shares of any other class or series of Preferred Stock ranking on a parity with
the shares of this Series 11 Class K Preferred Stock upon such dissolution,
liquidation or winding up unless proportionate distributive amounts shall be
paid on account of the shares of this Series 11 Class K Preferred Stock and
shares of such other class or series ranking on a parity with the shares of this
Series 11 Class K Preferred Stock, ratably, in proportion to the full
distributable amounts for which holders of all such parity shares are
respectively entitled upon such dissolution, liquidation or winding up.

Part 3 - Dividends.

3.1    The holders of the Series 11 Class K Preferred Stock are entitled to
receive if, when and as declared by the Board out of funds legally available
therefor, cumulative dividends, payable in cash or Common Stock of the
Corporation, par value $.001 per share (the "Common Stock"), at the
Corporation's election, at the rate of six percent (6%) per annum of the
Liquidation Value of the Series 11 Class K Preferred Stock. The Liquidation
Value of the Series 11 Class K Preferred Stock shall be $1,000.00 per share (the
"Dividend Rate"). The dividend is payable semi-annually within seven (7)
business days after each of December 31 and June 30 of each year, commencing
December 31, 1996 (each, a "Dividend Declaration Date"). Dividends shall be paid
only with respect to shares of Series 11 Class K Preferred Stock actually issued
and outstanding on a Dividend Declaration Date and to holders of record as of
the Dividend Declaration Date. Dividends shall accrue from the first day of the
semi-annual period in which such dividend may be payable, except with respect to
the first semi-annual dividend which shall accrue from the date of issuance of
the Series 11 Class K Preferred Stock. In the event that the Corporation elects
to pay dividends in Common Stock of the Corporation, each holder of the Series
11 Class K Preferred Stock shall receive shares of Common Stock of the
Corporation equal to the quotient of (i) the Dividend Rate in effect on the
applicable Dividend Declaration Date dividend by (ii) the average of the closing
bid quotation of the Common Stock as reported on the over-the-counter market, or
the closing sale price if listed on a national securities exchange, for the five
(5) trading days immediately prior to the Dividend Declaration Date (the "Stock
Dividend Price"). Dividends on the Series 11 Class K Preferred Stock shall be
cumulative, and no dividends or other distributions shall be paid or declared or
set aside for payment on the Common Stock until all accrued and unpaid dividends
on all outstanding shares of Series 11 Class K Preferred Stock shall have been
paid or declared and set aside for payment.

Part 4 - Conversion. The holders of the Series 11
Class K Preferred Stock shall have rights to convert the shares of Series 11
Class K Preferred Stock into shares of the Corporation's Common Stock, par value
$.001 per share ("Common Stock"), as follows (the "Conversion Rights"):

4.1    No Right to Convert. The Series 11 Class K Preferred shall not be
convertible into shares of Common Stock until after July 15, 2000.
 


-4-


4.2    Right to Convert. The Series 11 Class K Preferred
Stock may be convertible into shares of Common Stock at any time on or after
July 15, 2000.

4.3    Conversion Price. As used herein, the term
Conversion Price shall be the product of (i) the average closing bid quotation
of the Common Stock as reported on the over-the-counter market, or the closing
sale price if listed on a national securities exchange, for the five (5) trading
days immediately preceding the date of the Conversion Notice referred to in
Section 4.3 below multiplied by (ii) seventy-five percent (75%), subject to the
provisions of this Section 4.3. Notwithstanding the foregoing, the Conversion
Price shall not be (i) less than a minimum of $1.50 per share for a period of
twenty-four (24) months from the date of issuance of the Series 11 Class K
Preferred Stock, or, after twenty-four (24) months from the date of issuance of
the Series 11 Class K Preferred Stock, a minimum of $.50 per share (as
applicable, the "Minimum Conversion Price") or (ii) more than a maximum of $1.50
per share ( "Maximum Conversion Price"). If, after July 1, 1996, the Corporation
sustains a net loss, on a consolidated basis, in each of two (2) consecutive
quarters, as determined under generally accepted accounting principles, the
Minimum Conversion Price shall be reduced $.25 a share, but there shall be no
change to, or reduction of, the Maximum Conversion Price. For the purpose of
determining whether the Corporation has had a net loss in each of two (2)
consecutive quarters, at no time shall a quarter that has already been
considered in such determination be considered in any subsequent determination
(as an example the third quarter of 1996 in which there is a net profit and the
fourth quarter of 1996 in which there is a net loss shall be considered as two
consecutive quarters, and, as a result, the fourth quarter of 1996 shall not be
considered along with the first quarter of 1997 as two (2) consecutive quarters,
but the first quarter of 1997 must be considered with the second quarter of 1997
for the purposes of such determination). For the purposes of this Section 4.2, a
"quarter" is a three (3) month period ending on March 31, June 30, September 30,
and December 31. If any of the outstanding shares of Series 11 Class K Preferred
Stock are converted, in whole or in part, into Common Stock pursuant to the
terms of this Part 4, the number of shares of whole Common Stock to be issued to
the holder as a result of such conversion shall be determined by dividing (a)
the aggregate Liquidation Value of the Series 11 Class K Preferred Stock so
surrendered for conversion by (b) the Conversion Price in effect at the date of
the conversion. At the time of conversion of shares of the Series 11 Class K
Preferred Stock, the Corporation shall pay in cash to the holder thereof an
amount equal to all unpaid and accrued dividends, if any, accrued thereon to the
date of conversion, or, at the Corporation's option, in lieu of paying cash for
the accrued and unpaid dividends, issue that number of shares of whole Common
Stock which is equal to the product of dividing the amount of such unpaid and
accrued dividends to the date of conversion on the shares of Series 11 Class K
Preferred Stock so converted by the Conversion Price in effect at the date of
conversion.

4.4    Mechanics of Conversion. Any holder of the Series
11 Class K Preferred Stock who wishes to exercise its Conversion Rights pursuant
to Section 4.1 of this Part 4 must, if such shares are not being held in escrow
by the Corporation's attorneys, surrender the certificate therefor at the
principal executive office of the Corporation, and give written notice, which
may be via facsimile transmission, to the Corporation at such  
 


-5-

 
 office that it
elects to convert the same (the "Conversion Notice"). In the event that the shares of Series 11 Class K
Preferred Stock are being held in escrow by the Corporation's attorneys, no
delivery of the certificates shall be required. No Conversion Notice with
respect to any shares of Series 11 Class K Preferred Stock can be given prior to
the time such shares of Series 11 Class K Preferred Stock are eligible for
conversion in accordance with the provision of Section 4.1 above. Any such
premature Conversion Notice shall automatically be null and void. The
Corporation shall, within five (5) business days after receipt of an appropriate
and timely Conversion Notice (and certificate, if necessary), issue to such
holder of Series 11 Class K Preferred Stock or its agent a certificate for the
number of shares of Common Stock to which he shall be entitled; it being
expressly agreed that until and unless the holder delivers written notice to the
Corporation to the contrary, all shares of Common Stock issuable upon conversion
of the Series 11 Class K Preferred Stock hereunder are to be delivered by the
Corporation to a party designated in writing by the holder in the Conversion
Notice for the account of the holder and such shall be deemed valid delivery to
the holder of such shares of Common Stock. Such conversion shall be deemed to
have been made only after both the certificate for the shares of Series 11 Class
K Preferred Stock to be converted have been surrendered and the Conversion
Notice is received by the Corporation (or in the event that no surrender of the
Certificate is required, then only upon the receipt by the Corporation of the
Conversion Notice) (the "Conversion Documents"), and the person or entity whose
name is noted on the certificate evidencing such shares of Common Stock issuable
upon such conversion shall be treated for all purposes as the record holder of
such shares of Common Stock at and after such time. In the event that the
Conversion Notice is sent via facsimile transmission, the Corporation shall be
deemed to have received such Conversion Notice on the first business day on
which such facsimile Conversion Notice is actually received. If the Corporation
fails to deliver to the holder or its agent the certificate representing the
shares of Common Stock that the holder is entitled to receive as a result of
such conversion within five (5) business days after receipt by the Corporation
from the holder of an appropriate and timely Conversion Notice and certificates
pursuant to the terms of this Section 4.3, the Corporation shall pay to the
holder U.S. $1,000 for each day that the Corporation is late in delivering such
certificate to the holder or its agent.

4.5    Adjustments to Conversion Price for Stock Dividends and for
Combinations or Subdivisions of Common Stock. If the Corporation at
any time or from time to time while shares of Series 11 Class K Preferred Stock
are issued and outstanding shall declare or pay, without consideration, any
dividend on the Common Stock payable in Common Stock, or shall effect a
subdivision of the outstanding shares of Common Stock into a greater number of
shares of Common Stock (by stock split, reclassification or otherwise than by
payment of a dividend in Common Stock or in any right to acquire Common Stock),
or if the outstanding shares of Common Stock shall be combined or consolidated,
by reclassification or otherwise, into a lesser number of shares of Common
Stock, then the Conversion Price in effect immediately before such event shall,
concurrently with the effectiveness of such event, be proportionately decreased
or increased, as appropriate. If the Corporation shall declare or pay, without
consideration, any dividend on the Common Stock payable in any right to acquire
Common stock for no consideration, then the Corporation  
 


-6-

 
 shall be deemed to have made a dividend payable in Common Stock in an amount of
shares equal to the maximum number of shares issuable upon exercise of such
rights to acquire Common Stock.

4.6.    Adjustments for Reclassification and
Reorganization. If the Common Stock issuable upon conversion of the
Series 11 Class K Preferred Stock shall be changed into the same or a different
number of shares of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise (other than a subdivision or
combination of shares provided for in Section 4.4 hereof), the Conversion Price
then in effect shall, concurrently with the effectiveness of such reorganization
or reclassification, be proportionately adjusted so that the Series 11 Class K
Preferred Stock shall be convertible into, in lieu of the number of shares of
Common Stock which the holders of Series 11 Class K Preferred Stock would
otherwise have been entitled to receive, a number of shares of such other class
or classes of stock equivalent to the number of shares of Common Stock that
would have been subject to receipt by the holders upon conversion of the Series
11 Class K Preferred Stock immediately before that change.

4.7    Common Stock Duly Issued. All Common Stock which
may be issued upon conversion of Series 11 Class K Preferred Stock will, upon
issuance, be duly issued, fully paid and nonassessable and free from all taxes,
liens, and charges with respect to the issue thereof.

4.8    Notice of Adjustments. Upon the occurrence of
each adjustment or readjustment of any Conversion Price pursuant to this Part 4,
the Corporation, at its expense, within a reasonable period of time, shall
compute such adjustment or readjustment in accordance with the terms hereof and
prepare and furnish to each holder of Series 11 Class K Preferred Stock a notice
setting forth such adjustment or readjustment and showing in detail the facts
upon which such adjustment is based.

4.9    Issue Taxes. The Corporation shall pay any and
all issue and other taxes that may be payable in respect of any issue or
delivery of shares of Common Stock on conversion of the Series 11 Class K
Preferred Stock pursuant thereto; provided, however, that the Corporation
shall not be obligated to pay any transfer taxes resulting from any transfer
requested by any holder of Series 11 Class K Preferred Stock in connection with
such conversion.

4.10   Reservation of Stock Issuable Upon Conversion.
The Corporation shall at all times reserve and keep available out of its
authorized but unissued shares of Common Stock, solely for the purpose of
effecting the conversion of the shares of the Series 11 Class K Preferred Stock,
such number of its shares of Common Stock as shall, from time to time, be
sufficient to effect the conversion of all outstanding shares of the Series 11
Class K Preferred stock, and, if at any time, the number of authorized but
unissued shares of Common Stock shall not be sufficient to effect the conversion
of all then outstanding shares of the Series 11 Class K Preferred Stock, the
Corporation will take such corporate action as may be necessary to increase its
authorized but unissued shares of Common Stock to such number of shares as shall
be sufficient for such purposes, including, without limitation, engaging in
reasonable efforts to obtain the requisite stockholder approval of any necessary
amendment to its Certificate of Incorporation.
 


-7-

 
4.11   Fractional Shares. No fractional share shall be
issued upon the conversion of any share or shares of Series 11 Class K Preferred
Stock. All shares of Common Stock (including fractions thereof) issuable upon
conversion of more than one share of Series 11 Class K Preferred Stock by a
holder thereof shall be aggregated for purposes of determining whether the
conversion would result in the issuance of any fractional share. If, after the
aforementioned aggregation, the conversion would result in the issuance of a
fractional share of Common Stock, such fractional share shall be rounded up to
the nearest whole share.

4.12    Notices. Any notices required by the provisions
of this Part 4 to be given to the holders of shares of Series 11 Class K
Preferred Stock shall be deemed given if deposited in the United States mail,
postage prepaid, and addressed to each holder of record at his address appearing
on the books of the Corporation.

4.13    Business Day. As used herein, the term "business
day" shall mean any day other than a Saturday, Sunday or a day when the federal
and state banks located in the State of New York are required or permitted to
close.

Part 5 - Redemption.

5.1    Redemption at Corporation's Option. Except as
otherwise provided in this Section 5.1, at any time, and from time to time, the
Corporation may, at its sole option, but shall not be obligated to, redeem, in
whole or in part, at any time, and from time to time, the then outstanding
Series 11 Class K Preferred Stock at the following cash redemption prices if
redeemed during the following periods: (i) within one year
from July 15, 1999 - $1,100 per share, and (ii) after one year
from July 15, 1999 - $1,200 per share (as applicable, the
redemption price of $1,100 or $1,200 is referred to herein as the "Redemption
Price").

5.2    Mechanics of Redemption. Prior to any date
stipulated by the Corporation for the redemption of Series 11 Class K Preferred
Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be
mailed to each holder of record on such notice date of the Series 11 Class K
Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of
such shares, (ii) the number of Series 11 Class K Preferred Stock to be redeemed
from the holder to whom the Redemption Notice is addressed, (iii) instructions
for surrender to the Corporation, in the manner and at the place designated, of
a share certificate or share certificates representing the number of Series 11
Class K Preferred Stock to be redeemed from such holder, and (iv) instructions
as to how to specify to the Corporation the number of Series 11 Class K
Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption
Notice is mailed to the Holder after the first year from the date of issuance of
the Series 11 Class K Preferred Stock, the number of shares to be converted into
Common Stock as provided in Part 4 hereof.

5.3    Mechanics of Redemption. Prior to any date
stipulated by the Corporation for the redemption of Series 11 Class K Preferred
Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be
mailed to each holder of record on such notice date of the Series 11 Class K
Preferred Stock. The 

 



-8-

 
 Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number
of Series 11 Class K Preferred Stock to be redeemed from the holder to whom the
Redemption Notice is addressed, (iii) instructions for surrender to the
Corporation, in the manner and at the place designated, of a share certificate
or share certificates representing the number of Series 11 Class K Preferred
Stock to be redeemed from such holder, and (iv) instructions as to how to
specify to the Corporation the number of Series 11 Class K Preferred Stock to be
redeemed as provided in this Part 5 and, if the Redemption Notice is mailed to
the Holder after the first year from the date of issuance of the Series 11 Class
K Preferred Stock, the number of shares to be converted into Common Stock as
provided in Part 4 hereof.

5.4   Rights of Conversion Upon Redemption. If the
redemption occurs during the first 12 months after the issuance of the Series 11
Class K Preferred Stock, the holder may not convert any redeemed shares. If the
redemption occurs pursuant to Section 5.1 hereof, the Holder of the Series 11
Class K Preferred Stock shall not have the right to convert those outstanding
shares of Series 11 Class K Preferred Stock that the Company is redeeming after
receipt of the Redemption Notice. If the redemption occurs pursuant to Section
5.2 hereof, then, upon receipt of the Redemption Notice, any holder of Series 11
Class K Preferred Stock shall have the next five business days during which it
may exercise the option, at its sole election, to specify what portion of its
Series 11 Class K Preferred Stock called for redemption in the Redemption Notice
shall be redeemed as provided in this Part 5 or converted into Common Stock in
the manner provided in Part 4 hereof, except that, notwithstanding any provision
of such Part 4 to the contrary, after one year from the date of first issuance
of the Series 11 Class K Preferred Stock, such holder shall have the right to
convert into Common Stock that number of Series 11 Class K Preferred Stock
called for redemption in the Redemption Notice.

5.5   Surrender of Certificates. On or before the
Redemption Date in respect of any Series 11 Class K Preferred Stock, each holder
of such shares shall surrender the required certificate or certificates
representing such shares to the Corporation in the manner and at the place
designated in the Redemption Notice, and upon the Redemption Date, the
Redemption Price for such shares shall be made payable, in the manner provided
in Section 5.5 hereof, to the order of the person whose name appears on such
certificate or certificates as the owner thereof, and each surrendered share
certificate shall be canceled and retired. If a share certificate is surrendered
and all the shares evidenced thereby are not being redeemed (as described
below), the Corporation shall cause the Series 11 Class K Preferred Stock which
are not being redeemed to be registered in the names of the persons or entity
whose names appear as the owners on the respective surrendered share
certificates and deliver such certificate to such person.

5.6    Payment. On the Redemption Date in respect of any
Series 11 Class K Preferred Stock or prior thereto, the Corporation shall
deposit with any bank or trust company having a capital and surplus of at least
U. S. $50,000,000, as a trust fund, a sum equal to the aggregate First Year
Redemption Price or the Redemption Price, whichever is applicable, of all such
shares called from redemption (less the aggregate Redemption Price for those
Series 11 Class K Preferred Stock in respect of which the Corporation has
received notice from the
 


-9-

 
holder thereof of its election to convert Series 11 Class K Preferred Stock
into Common Stock), with irrevocable instructions and authority to the bank or
trust company to pay, on or after the Redemption Date, the First Year Redemption
Price or the Redemption Price, whichever is applicable, to the respective
holders upon the surrender of their share certificates. The deposit shall
constitute full payment for the shares to their holders, and from and after the
date of the deposit the redeemed shares shall be deemed to be no longer
outstanding, and holders thereof shall cease to be shareholders with respect to
such shares and shall have no rights with respect thereto except the rights to
receive from the bank or trust company payments of the First Year Redemption
Price or the Redemption Price, whichever is applicable, of the shares, without
interest, upon surrender of their certificates thereof. Any funds so deposited
and unclaimed at the end of one year following the Redemption Date shall be
released or repaid to the Corporation, after which the former holders of shares
called for redemption shall be entitled to receive payment of the First Year
Redemption Price or the Redemption Price, whichever is applicable, in respect of
their shares only from the Corporation.

Part 6 - Parity with Other Shares of Series 11 Class K Preferred
Stock and Priority.

6.1    Rateable Participation. If any cumulative
dividends or return of capital in respect of Series 11 Class K Preferred Stock
are not paid in full, the owners of all series of outstanding Preferred Stock
shall participate rateably in respect of accumulated dividends and return of
capital.

6.2    Ranking. For purposes of this resolution, any
stock of any class or series of the Corporation shall be deemed to rank:

         6.2.1  Prior or senior to the shares of this Series 11 Class K Preferred Stock
either as to 

                   dividends or upon liquidation, if the holders of such class or
classes shall be entitled 

                   to the receipt of dividends or of amounts
distributable upon dissolution, liquidation 

                   or winding up of the Corporation,
whether voluntary or involuntary, as the case 

                   may be, in preference or priority
to the holders of shares of this Series 11 Class 

                   K Preferred Stock;

        6.2.2  On a parity with, or equal to, shares of this Series 11 Class K
Preferred Stock, either 

                   as to dividends or upon liquidation, whether or not the
dividend rates, dividend 

                   payment dates, or redemption or liquidation prices per
share or sinking fund 

                   provisions, if any, are different from those of this
Series 3 Class C Preferred Stock, 

                   if the holders of such stock are entitled to
the receipt of dividends or of amounts 

                  distributable upon dissolution,
liquidation or winding up of the Corporation, whether 

                   voluntary or involuntary,
in proportion to their respective dividend rates or liquidation 

                   prices, without
preference or priority, one over the other, as between the holders of 

                   such stock
and over the other, as between the holders of such stock and the holders 

                   of
shares of this Series 11 Class K Preferred Stock; and,
 


-10-

 
        6.2.3  Junior to shares of this Series 11 Class K Preferred Stock, either as
to dividends or 

                  upon liquidation, if such class or series shall be Common Stock
or if the holders of 

                  shares of this Series 11 Class K Preferred Stock shall be
entitled to receipt of 

                  dividends or of amounts distributable upon dissolution,
liquidation or winding up of 

                   the Corporation, whether voluntary or involuntary,
as the case may be, in preference 

                   or priority to the holders of shares of such
class or series.

Part 7 - Amendment and Reissue.

7.1   Amendment. If any proposed amendment to the
Corporation's Certificate of Incorporation would alter or change the powers,
preferences or special rights of the Series 11 Class K Preferred Stock so as to
affect such adversely, then the Corporation must obtain the affirmative vote of
such amendment to the Certificate of Incorporation at a duly called and held
series meeting of the holders of the Series 11 Class K Preferred Stock or
written consent by the holders of a majority of the Series 11 Class K Preferred
Stock then outstanding. Notwithstanding the above, the number of authorized
shares of any class or classes of stock may be increased or decreased (but not
below the number of shares thereof outstanding) by the affirmative vote of the
holders of a majority of the stock of the Corporation entitled to vote thereon,
voting together as a single class, irrespective of this Section 7.1 or the
requirements of Section 242 of the GCL.

7.2   Authorized. Any shares of Series 11 Class K
Preferred Stock acquired by the Corporation by reason of purchase, conversion,
redemption or otherwise shall be retired and shall become authorized but
unissued shares of Preferred Stock, which may be reissued as part of a new
series of Preferred Stock hereafter created.
 
 

 

 

 

 



-11-


STATE OF DELAWARE   

SECRETARY OF STATE   

DIVISION OF CORPORATIONS

FILED 12:31 PM -- 07/15/1999 

991291289 -- 2249849     





CERTIFICATE OF DESIGNATIONS

OF SERIES 12 CLASS L CONVERTIBLE PREFERRED STOCK

OF

PERMA-FIX ENVIRONMENTAL SERVICES, INC.



          Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation
organized and existing under the General Corporation Law of the State of
Delaware, does hereby certify:

           That, pursuant to authority conferred upon by the Board of Directors by the
Corporation's Restated Certificate of Incorporation, as amended, and pursuant to
the provisions of Section 151 of the Delaware Corporation Law, the Board of
Directors of the Corporation has adopted resolutions, a copy of which is
attached hereto, establishing and providing for the issuance of a series of
Preferred Stock designated as Series 12 Class L Convertible Preferred Stock and
has established and fixed the voting powers, designations, preferences and
relative participating, optional and other special rights and qualifications,
limitations and restrictions of such Series 12 Class L Convertible Preferred
Stock as set forth in the attached resolutions.

Dated: July 15, 1999

                                                              PERMA-FIX ENVIRONMENTAL SERVICES, INC.


                                                               By /s/ Louis Centofanti                                               

                                                                     Dr. Louis F. Centofanti

                                                                     Chairman of the Board
ATTEST:


/s/ Richard T. Kelecy                          

Richard T. Kelecy, Secretary
 

 

 



PERMA-FIX ENVIRONMENTAL SERVICES, INC.

(the "Corporation")



RESOLUTION OF THE BOARD OF DIRECTORS

FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,

RESTRICTIONS AND CONDITIONS ATTACHING TO THE

SERIES 12 CLASS L CONVERTIBLE PREFERRED STOCK



          WHEREAS, the Corporation's capital includes preferred stock,
par value $.001 per share ("Preferred Stock"), which Preferred Stock may be
issued in one or more series by resolutions adopted by the directors, and with
the directors being entitled by resolution to fix the number of shares in each
series and to designate the rights, designations, preferences and relative,
participating, optional or other special rights and privileges, restrictions and
conditions attaching to the shares of each such series;

          WHEREAS, it is in the best interests of the Corporation for
the Board to create a new series from the Preferred Stock designated as the
Series 12 Class L Convertible Preferred Stock, par value $.001 per share (the
"Series 12 Class L Preferred Stock");

          NOW, THEREFORE, BE IT RESOLVED, that the Series 12 Class L
Preferred Stock shall consist of nine hundred sixteen (916) shares and no more
and shall be designated as the Series 12 Class L Convertible Preferred Stock,
and the preferences, rights, privileges, restrictions and conditions attaching
to the Series 12 Class L Preferred Stock shall be as follows:

Part 1 - Voting and Preemptive Rights.

1.1    Voting Rights. Except as otherwise provided in
Part 7 hereof or under Section 242(b)(2) of the General Corporation Law of the
State of Delaware (the "GCL"), the holders of the Series 12 Class L Preferred
Stock shall have no voting rights whatsoever. To the extent that under Section
242(b)(2) of the GCL or Part 7 hereof, the holders of the Series 12 Class L
Preferred Stock are entitled to vote on a matter, each share of the Series 12
Class L Preferred Stock shall be entitled one (1) vote for each outstanding
share of Series 12 Class L Preferred Stock. Holders of the Series 12 Class L
Preferred Stock shall be entitled to notice of (and copies of proxy materials
and other information sent to stockholders) for all shareholder meetings or
written consents with respect to which they would be entitled to vote, which
notice would be provided pursuant to the Corporation's bylaws and applicable
statutes.

1.2    No Preemptive Rights. The Series 12 Class L
Preferred Stock shall not give its holders any preemptive rights to acquire any
other securities issued by the Corporation at any time in the future.
 


-1-


Part 2 - Liquidation Rights.

2.1    Liquidation. If the Corporation shall be
voluntarily or involuntarily liquidated, dissolved or wound up at any time when
any shares of the Series 12 Class L Preferred Stock shall be outstanding, the
holders of the then outstanding Series 12 Class L Preferred Stock shall have a
preference in distribution of the Corporation's property available for
distribution to the holders of the Corporation's Common Stock equal to $1,000
consideration per outstanding share of Series 12 Class L Preferred Stock, plus
an amount equal to all unpaid dividends accrued thereon to the date of payment
of such distribution ("Liquidation Preference"), whether or not declared by the
Board.

2.2    Payment of Liquidation Preferences. Subject to
the provisions of Part 6 hereof, all amounts to be paid as Liquidation
Preference to the holders of Series 12 Class L Preferred Stock, as provided in
this Part 2, shall be paid or set apart for payment before the payment or
setting apart for payment of any amount for, or the distribution of any of the
Corporation's property to the holders of the Corporation's Common Stock, whether
now or hereafter authorized, in connection with such liquidation, dissolution or
winding up.

2.3    No Rights After Payment. After the payment to the
holders of the shares of the Series 12 Class L Preferred Stock of the full
Liquidation Preference amounts provided for in this Part 2, the holders of the
Series 12 Class L Preferred Stock as such shall have no right or claim to any of
the remaining assets of the Corporation.

2.4    Assets Insufficient to Pay Full Liquidation
Preference. In the event that the assets of the Corporation
available for distribution to the holders of shares of the Series 12 Class L
Preferred Stock upon any dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, shall be insufficient to pay in
full all amounts to which such holders are entitled pursuant to this Part 2, no
such distribution shall be made on account of any shares of any other class or
series of Preferred Stock ranking on a parity with the shares of this Series 12
Class L Preferred Stock upon such dissolution, liquidation or winding up unless
proportionate distributive amounts shall be paid on account of the shares of
this Series 12 Class L Preferred Stock and shares of such other class or series
ranking on a parity with the shares of this Series 12 Class L Preferred Stock,
ratably, in proportion to the full distributable amounts for which holders of
all such parity shares are respectively entitled upon such dissolution,
liquidation or winding up.

Part 3 - Dividends. The holders of the Series 12
Class L Preferred Stock are entitled to receive if, when and as declared by the
Board out of funds legally available therefor, cumulative dividends, payable in
cash or Common Stock of the Corporation, par value $.001 per share (the "Common
Stock"), or any combination thereof, at the Corporation's election, at the rate
of four percent (4%)
 


-2-


per annum of the Liquidation Value (as defined below) of each issued and
outstanding share of Series 12 Class L Preferred Stock (the "Dividend Rate").
The Liquidation Value of the Series 12 Class L Preferred Stock shall be $1,000
per outstanding share of the Series 12 Class L Preferred Stock (the "Liquidation
Value"). The dividend is payable semi-annually within seven (7) business days
after each of December 31 and June 30 of each year, commencing June 30, 1998
(each, a "Dividend Declaration Date"). Dividends shall be paid only with respect
to shares of Series 12 Class L Preferred Stock actually issued and outstanding
on a Dividend Declaration Date and to holders of record of the Series 12 Class L
Preferred Stock as of the Dividend Declaration Date. Dividends shall accrue from
the first day of the semi-annual period in which such dividend may be payable,
except with respect to the first semi-annual dividend which shall accrue from
March 1, 1998. In the event that the Corporation elects to pay the accrued
dividends due as of a Dividend Declaration Date on an outstanding share of the
Series 12 Class L Preferred Stock in Common Stock of the Corporation, the holder
of such share shall receive that number of shares of Common Stock of the
Corporation equal to the product of (a) the quotient of (i) the Dividend Rate
divided by (ii) the average of the closing bid quotation of the Corporation's
Common Stock as reported on the National Association of Securities Dealers
Automated Quotation system ("NASDAQ"), or the average closing sale price if
listed on a national securities exchange, for the five (5) trading days
immediately prior to the Dividend Declaration Date (the "Stock Dividend Price"),
times (b) a fraction, the numerator of which is the number of days elapsed
during the period for which the dividend is to be paid and the denominator of
which is 365. Dividends on the Series 12 Class L Preferred Stock shall be
cumulative, and no dividends or other distributions shall be paid or declared or
set aside for payment on the Corporation's Common Stock until all accrued and
unpaid dividends on all outstanding shares of Series 12 Class L Preferred Stock
shall have been paid or declared and set aside for payment.

Part 4 - Conversion. The holders of the Series 12
Class L Preferred Stock shall have rights to convert the shares of Series 12
Class L Preferred Stock into shares of the Corporation's Common Stock, par value
$.001 per share ("Common Stock"), as follows (the "Conversion Rights"):

4.1    No Right to Convert. The Series 12 Class L
Preferred shall not be convertible into shares of Common Stock until after July
15, 2000.

4.2    Right to Convert. The Series 12
Class L Preferred Stock may be convertible into shares of Common Stock at any
time after July 15, 2000.

4.3    Conversion Price. Subject to the terms hereof, as
used herein, the Conversion Price per outstanding share of Series 12 Class L
Preferred Stock shall be $1.8125, except that, in the event the average closing
bid price per share of the Common Stock as reported on the
over-the-counter
 


-3-


market, or the closing sale price if listed on a national securities
exchange, for the five (5) trading days prior to the particular date of
conversion shall be less than $2.265, the Conversion Price for only such
particular conversion shall be the product of the average closing bid quotation
of the Common Stock as reported on the over-the-counter market, or the closing
sale price if listed on a national securities exchange, for the five (5) trading
days immediately preceding the date of the Conversion Notice referred to in
Section 4.3 below in connection with such conversion multiplied by eighty
percent (80%), subject to the provisions of this Section 4.3. Notwithstanding
the foregoing, the Conversion Price shall not be less than a minimum of $1.50
per share ("Minimum Conversion Price") for a period of twenty-four (24) months
from the date of issuance of the Series 12 Class L Preferred Stock. If any of
the outstanding shares of Series 12 Class L Preferred Stock are converted, in
whole or in part, into Common Stock pursuant to the terms of this Part 4, the
number of shares of whole Common Stock to be issued to the holder as a result of
such conversion shall be determined by dividing (a) the aggregate Liquidation
Value of the Series 12 Class L Preferred Stock so surrendered for conversion by
(b) the Conversion Price as of such conversion. At the time of conversion of
shares of the Series 12 Class L Preferred Stock, the Corporation shall pay in
cash to the holder thereof an amount equal to all unpaid and accrued dividends,
if any, accrued thereon to the date of conversion, or, at the Corporation's
option, in lieu of paying cash for the accrued and unpaid dividends, issue that
number of whole shares of Common Stock which is equal to the quotient of the
amount of such unpaid and accrued dividends to the date of conversion on the
shares of Series 12 Class L Preferred Stock so converted divided by the Stock
Dividend Price, as defined in Part 3 hereof, in effect at the date of
conversion.

4.3    Mechanics of Conversion. Any holder of the Series
12 Class L Preferred Stock who wishes to exercise its Conversion Rights pursuant
to Section 4.1 of this Part 4 must, if such shares are not being held in escrow
by the Corporation's attorneys, surrender the certificate therefor at the
principal executive office of the Corporation, and give written notice, which
may be via facsimile transmission, to the Corporation at such office that it
elects to convert the same (the "Conversion Notice"). In the event that the
shares of Series 12 Class L Preferred Stock are being held in escrow by the
Corporation's attorneys, no delivery of the certificates shall be required. The
Corporation shall, within five (5) business days after receipt of an appropriate
and timely Conversion Notice (and certificate, if necessary), issue to such
holder of Series 12 Class L Preferred Stock or its agent a certificate for the
number of shares of Common Stock to which he shall be entitled; it being
expressly agreed that until and unless the holder delivers written notice to the
Corporation to the contrary, all shares of Common Stock issuable upon conversion
of the Series 12 Class L Preferred Stock hereunder are to be delivered by the
Corporation to a party designated in writing by the holder in the Conversion
Notice for the account of the holder and such shall be deemed valid delivery to
the holder of such shares of Common Stock. Such conversion shall be deemed to
have been

 



-4-


made only after both the certificate for the shares of Series 12 Class L
Preferred Stock to be converted have been surrendered and the Conversion Notice
is received by the Corporation (or in the event that no surrender of the
Certificate is required, then only upon the receipt by the Corporation of the
Conversion Notice) (the "Conversion Documents"), and the person or entity whose
name is noted on the certificate evidencing such shares of Common Stock issuable
upon such conversion shall be treated for all purposes as the record holder of
such shares of Common Stock at and after such time. In the event that the
Conversion Notice is sent via facsimile transmission, the Corporation shall be
deemed to have received such Conversion Notice on the first business day on
which such facsimile Conversion Notice is actually received. If the Corporation
fails to deliver to the holder or its agent the certificate representing the
shares of Common Stock that the holder is entitled to receive as a result of
such conversion of the Series 12 Class L Preferred Stock within seven (7)
business days after receipt by the Corporation from the holder of an appropriate
and timely Conversion Notice and certificates pursuant to the terms of this
Section 4.3 ("Seven (7) Business Day Period"), then, upon the written demand of
RBB Bank Aktiengesellschaft ("RBB Bank"), the holder of the Series 12 Class L
Preferred Stock, for payment of the penalty described below in this Section 4.3,
which demand must be received by the Corporation no later than ten (10) calendar
days after the expiration of such Seven (7) Business Day Period, the Corporation
shall pay to RBB Bank the following penalty for each business day after the
Seven (7) Business Day Period until the Corporation delivers to the holder or
its agent the certificate representing the shares of Common Stock that the
holder is entitled to receive as a result of such conversion: business day eight
(8) - U.S. $1,000; business day nine (9) - U.S. $2,000, and each business day
thereafter an amount equal to the penalty due on the immediately preceding
business day times two (2) until the Corporation delivers to the holder or its
agent the certificate representing the shares of Common Stock that the holder is
entitled to receive as a result of such conversion. 

4.4    Merger or Consolidation. In case of either (a)
any merger or consolidation to which the Corporation is a party (collectively,
the "Merger"), other than a Merger in which the Corporation is the surviving or
continuing corporation, or (b) any sale or conveyance to another corporation of
all, or substantially all, of the assets of the Corporation (collectively, the
"Sale"), and such Merger or Sale becomes effective (x) while any shares of
Series 12 Class L Preferred Stock are outstanding and prior to the date that the
Corporation's Registration Statement covering up to 1,379,311 shares of Common
Stock issuable upon the conversion of the Series 12 Class L Preferred Stock is
declared effective by the U. S. Securities and Exchange Commission or (y) prior
to the end of the restriction periods in Section 4.1, then, in such event, the
Corporation or such successor corporation, as the case may be, shall make
appropriate provision so that the holder of each share of Series 12 Class L
Preferred Stock then outstanding shall have the right to convert such share
of
 


-5-


Series 12 Class L Preferred Stock into the kind and amount of shares of stock
or other securities and property receivable upon such Merger or Sale by a holder
of the number of shares of Common Stock into which such shares of Series 12
Class L Preferred Stock could have been converted into immediately prior to such
Merger or Sale, subject to adjustments which shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Part 4.

4.5    Adjustments to Conversion Price for Stock Dividends and for
Combinations or Subdivisions of Common Stock. If the Corporation at
any time or from time to time while shares of Series 12 Class L Preferred Stock
are issued and outstanding shall declare or pay, without consideration, any
dividend on the Common Stock payable in Common Stock, or shall effect a
subdivision of the outstanding shares of Common Stock into a greater number of
shares of Common Stock (by stock split, reclassification or otherwise than by
payment of a dividend in Common Stock or in any right to acquire Common Stock),
or if the outstanding shares of Common Stock shall be combined or consolidated,
by reclassification or otherwise, into a lesser number of shares of Common
Stock, then the Conversion Price in effect immediately before such event shall,
concurrently with the effectiveness of such event, be proportionately decreased
or increased, as appropriate.

4.6   Adjustments for Reclassification and
Reorganization. If the Common Stock issuable upon conversion of the
Series 12 Class L Preferred Stock shall be changed into the same or a different
number of shares of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise (other than a subdivision or
combination of shares provided for in Section 4.4 hereof), the Conversion Price
shall, concurrently with the effectiveness of such reorganization or
reclassification, be proportionately adjusted so that the Series 12 Class L
Preferred Stock shall be convertible into, in lieu of the number of shares of
Common Stock which the holders of Series 12 Class L Preferred Stock would
otherwise have been entitled to receive, a number of shares of such other class
or classes of stock equivalent to the number of shares of Common Stock that
would have been subject to receipt by the holders upon conversion of the Series
12 Class L Preferred Stock immediately before that change.

4.7   Common Stock Duly Issued. All Common Stock which
may be issued upon conversion of Series 12 Class L Preferred Stock will, upon
issuance, be duly issued, fully paid and nonassessable and free from all taxes,
liens, and charges with respect to the issue thereof.

4.8   Notice of Adjustments. Upon the occurrence of
each adjustment or readjustment of any Conversion Price pursuant to this Part 4,
the Corporation, at its expense, within a reasonable period of time, shall
compute such adjustment or readjustment in accordance with the terms hereof
and

 



-6-


prepare and furnish to each holder of Series 12 Class L Preferred Stock a
notice setting forth such adjustment or readjustment and showing in detail the
facts upon which such adjustment is based.

4.9   Issue Taxes. The Corporation shall pay any and
all issue and other taxes that may be payable in respect of any issue or
delivery of shares of Common Stock on conversion of the Series 12 Class L
Preferred Stock pursuant thereto; provided, however, that the Corporation
shall not be obligated to pay any transfer taxes resulting from any transfer
requested by any holder of Series 12 Class L Preferred Stock in connection with
such conversion.

4.10  Reservation of Stock Issuable Upon Conversion.
The Corporation shall at all times reserve and keep available out of its
authorized but unissued shares of Common Stock, solely for the purpose of
effecting the conversion of the shares of the Series 12 Class L Preferred Stock,
such number of its shares of Common Stock as shall, from time to time, be
sufficient to effect the conversion of all outstanding shares of the Series 12
Class L Preferred stock, and, if at any time, the number of authorized but
unissued shares of Common Stock shall not be sufficient to effect the conversion
of all then outstanding shares of the Series 12 Class L Preferred Stock, the
Corporation will take such corporate action as may be necessary to increase its
authorized but unissued shares of Common Stock to such number of shares as shall
be sufficient for such purposes, including, without limitation, engaging in
reasonable efforts to obtain the requisite stockholder approval of any necessary
amendment to its Certificate of Incorporation.

4.11  Fractional Shares. No fractional shares shall be
issued upon the conversion of any share or shares of Series 12 Class L Preferred
Stock. All shares of Common Stock (including fractions thereof) issuable upon
conversion of more than one share of Series 12 Class L Preferred Stock by a
holder thereof shall be aggregated for purposes of determining whether the
conversion would result in the issuance of any fractional share. If, after the
aforementioned aggregation, the conversion would result in the issuance of a
fractional share of Common Stock, such fractional share shall be rounded up to
the nearest whole share.

4.12  Notices. Any notices required by the provisions
of this Part 4 to be given to the holders of shares of Series 12 Class L
Preferred Stock shall be deemed given if deposited in the United States mail,
postage prepaid, and addressed to each holder of record at his address appearing
on the books of the Corporation.

4.13  Business Day. As used herein, the term "business
day" shall mean any day other than a Saturday, Sunday or a day when the federal
and state banks located in the State of New York are required or is permitted to
close.
 


-7-


Part 5 - Redemption.

5.1  Redemption at Corporation's Option. Except as
otherwise provided in this Section 5.1, at any time, and from time to time, the
Corporation may, at its sole option, but shall not be obligated to, redeem, in
whole or in part, at any time, and from time to time, (i) for a period of 120
days from the date of issuance of the Series 12 Class L Preferred Stock up to an
aggregate of 300 shares of the Series 12 Class L Preferred Stock at the cash
redemption price of $1,000 per share, and (ii) the then outstanding Series 12
Class L Preferred Stock at the following cash redemption prices if redeemed
during the following periods: (a) within one year from
July 15, 1999 - $1,100 per share, except as otherwise provided in (i)
above and (b) after one year from July 15, 1999 - $1,200 per
share (as applicable, the redemption price of $1,000, $1,100 or $1,200 is
referred to herein as the "Redemption Price").

5.2  Mechanics of Redemption. Prior to any date
stipulated by the Corporation for the redemption of Series 12 Class L Preferred
Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be
mailed to each holder of record on such notice date of the Series 12 Class L
Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of
such shares, (ii) the number of Series 12 Class L Preferred Stock to be redeemed
from the holder to whom the Redemption Notice is addressed, (iii) instructions
for surrender to the Corporation, in the manner and at the place designated, of
a share certificate or share certificates representing the number of Series 12
Class L Preferred Stock to be redeemed from such holder, and (iv) instructions
as to how to specify to the Corporation the number of Series 12 Class L
Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption
Notice is mailed to the Holder after the first year from the date of issuance of
the Series 12 Class L Preferred Stock, the number of shares to be converted into
Common Stock as provided in Part 4 hereof.

5.3  Rights of Conversion Upon Redemption. If the
redemption occurs during the first 12 months after the issuance of the Series 12
Class L Preferred Stock, the holder may not convert any redeemed shares. If the
redemption occurs after the first twelve months after the first issuance of
Series 12 Class L Preferred Stock, then, upon receipt of the Redemption Notice,
any holder of Series 12 Class L Preferred Stock shall have five business days
during which it may exercise the option, at its sole election, to specify what
portion of its Series 12 Class L Preferred Stock called for redemption in the
Redemption Notice shall be redeemed as provided in this Part 5 or converted into
Common Stock in the manner provided in Part 4 hereof, except that,
notwithstanding any provision of such Part 4 to the contrary, after one year
from the date of first issuance of the Series 12 Class L Preferred Stock, such
holder shall have the right to convert into Common Stock that number of Series
12 Class L Preferred Stock called for redemption in the Redemption
Notice.
 


-8-


5.4  Surrender of Certificates. On or before the
Redemption Date in respect of any Series 12 Class L Preferred Stock, each holder
of such shares shall surrender the required certificate or certificates
representing such shares to the Corporation in the manner and at the place
designated in the Redemption Notice, and upon the Redemption Date, the
Redemption Price for such shares shall be made payable, in the manner provided
in Section 5.6 hereof, to the order of the person whose name appears on such
certificate or certificates as the owner thereof, and each surrendered share
certificate shall be canceled and retired. If a share certificate is surrendered
and all the shares evidenced thereby are not being redeemed (as described
below), the Corporation shall cause the Series 12 Class L Preferred Stock which
are not being redeemed to be registered in the names of the persons or entity
whose names appear as the owners on the respective surrendered share
certificates and deliver such certificate to such person.

5.5  Payment. On the Redemption Date in respect of any
Series 12 Class L Preferred Stock or prior thereto, the Corporation shall
deposit with any bank or trust company having a capital and surplus of at least
$50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of
all such shares called from redemption (less the aggregate Redemption Price for
those Series 12 Class L Preferred Stock in respect of which the Corporation has
received notice from the holder thereof of its election to convert Series 12
Class L Preferred Stock into Common Stock), with irrevocable instructions and
authority to the bank or trust company to pay, on or after the Redemption Date,
the Redemption Price to the respective holders upon the surrender of their share
certificates. The deposit shall constitute full payment for the shares to their
holders, and from and after the date of the deposit the redeemed shares shall be
deemed to be no longer outstanding, and holders thereof shall cease to be
shareholders with respect to such shares and shall have no rights with respect
thereto except the rights to receive from the bank or trust company payments of
the Redemption Price of the shares, without interest, upon surrender of their
certificates thereof. Any funds so deposited and unclaimed at the end of one
year following the Redemption Date shall be released or repaid to the
Corporation, after which the former holders of shares called for redemption
shall be entitled to receive payment of the Redemption Price in respect of their
shares only from the Corporation.

Part 6 - Parity with Other Shares of Series 12 Class L Preferred
Stock and Priority.

6.1   Rateable Participation. If any cumulative
dividends or return of capital in respect of Series 12 Class L Preferred Stock
are not paid in full, the owners of all series of outstanding Preferred Stock
shall participate rateably in respect of accumulated dividends and return of
capital.
 


-9-


6.2  Ranking. For purposes of this resolution, any
stock of any class or series of the Corporation shall be deemed to rank:

        6.2.1  Prior or senior to the shares of this Series 12 Class L Preferred Stock
either as to 

                  dividends or upon liquidation, if the holders of such class or
classes shall be entitled 

                  to the receipt of dividends or of amounts
distributable upon dissolution, liquidation 

                  or winding up of the Corporation,
whether voluntary or involuntary, as the case 

                  may be, in preference or priority
to the holders of shares of this Series 12 Class L 

                  Preferred Stock;

       6.2.2  On a parity with, or equal to, shares of this Series 12 Class L
Preferred Stock, either 

                 as to dividends or upon liquidation, whether or not the
dividend rates, dividend payment 

                 dates, or redemption or liquidation prices per
share or sinking fund provisions, if any, 

                 are different from those of this
Series 12 Class L Preferred Stock, if the holders of such 

                 stock are entitled to
the receipt of dividends or of amounts distributable upon 

                 dissolution,
liquidation or winding up of the Corporation, whether voluntary or involuntary, 

                  in proportion to their respective dividend rates or liquidation prices, without
preference 

                  or priority, one over the other, as between the holders of such stock
and over the other, 

                  as between the holders of such stock and the holders of
shares of this Series 12 Class 

                  L Preferred Stock; and,

        6.2.3  Junior to shares of this Series 12 Class L Preferred Stock, either as
to dividends or 

                  upon liquidation, if such class or series shall be Common Stock
or if the holders of shares 

                  of this Series 12 Class L Preferred Stock shall be
entitled to receipt of dividends or of 

                  amounts distributable upon dissolution,
liquidation or winding up of the Corporation, 

                  whether voluntary or involuntary,
as the case may be, in preference or priority to the 

                   holders of shares of such
class or series.

Part 7 - Amendment and Reissue.

7.1    Amendment. If any proposed amendment to the
Corporation's Certificate of Incorporation (the "Articles") would alter or
change the powers, preferences or special rights of the Series 12 Class L
Preferred Stock so as to affect such adversely, then the Corporation must obtain
the affirmative vote of such amendment to the Articles at a duly called and held
series meeting of the holders of the Series 12 Class L Preferred Stock or
written consent by the holders of a majority of the Series 12 Class L Preferred
Stock then outstanding. Notwithstanding the above or the provisions of Section
242(b)(2) of the GCL, the number 
 


-10-


of authorized shares of any class or classes of stock of the Corporation may be
increased or decreased (but not below the number of shares thereof outstanding)
by the affirmative vote of the holders of a majority of the stock of the
Corporation entitled to vote thereon, voting together as a single class,
irrespective of the provisions of this Section 7.1 or Section 242(b)(2) of the
GCL.

7.2    Authorized. Any shares of Series 12 Class L
Preferred Stock acquired by the Corporation by reason of purchase, conversion,
redemption or otherwise shall be retired and shall become authorized but
unissued shares of Preferred Stock, which may be reissued as part of a new
series of Preferred Stock hereafter created.

 
 

 

 

 

 

 

 



-11-


STATE OF DELAWARE   

SECRETARY OF STATE   

DIVISION OF CORPORATIONS

FILED 12:32 PM 07/15/1999  

991291291 -- 2249849      



CERTIFICATE OF DESIGNATIONS

OF SERIES 13 CLASS M CONVERTIBLE PREFERRED STOCK

OF

PERMA-FIX ENVIRONMENTAL SERVICES, INC.


          Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation
organized and existing under the General Corporation Law of the State of
Delaware, does hereby certify:

           That, pursuant to authority conferred upon by the Board of Directors by the
Corporation's Restated Certificate of Incorporation, as amended, and pursuant to
the provisions of Section 151 of the Delaware Corporation Law, the Board of
Directors of the Corporation has adopted resolutions, a copy of which is
attached hereto, establishing and providing for the issuance of a series of
Preferred Stock designated as Series 13 Class M Convertible Preferred Stock and
has established and fixed the voting powers, designations, preferences and
relative participating, optional and other special rights and qualifications,
limitations and restrictions of such Series 13 Class M Convertible Preferred
Stock as set forth in the attached resolutions.

Dated: July 15, 1999

                                                       PERMA-FIX ENVIRONMENTAL SERVICES, INC.


                                                        By
 /s/ Louis F. Centofanti                                             

                                                              Dr. Louis F. Centofanti

                                                              Chairman of the Board
ATTEST:



/s/ Richard T. Kelecy                        

Richard T. Kelecy, Secretary
 

 

 

 



PERMA-FIX ENVIRONMENTAL SERVICES, INC.

(the "Corporation")



RESOLUTION OF THE BOARD OF DIRECTORS

FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,

RESTRICTIONS AND CONDITIONS ATTACHING TO THE

SERIES 13 CLASS M CONVERTIBLE PREFERRED STOCK
RE: DESIGNATION OF SERIES 13 CLASS M PREFERRED STOCK.

RESOLVED: That the designations, powers, preferences and
rights of the Series 13 Class M Convertible Preferred Stock be, and they hereby
are, as set forth below:
1.  Number of Shares of Common Stock of Series 13
Class M Convertible Preferred Stock 

The Corporation hereby authorizes the issuance of up to two thousand two
hundred fifty-two (2,252) shares of Series 13 Class M Convertible Preferred
Stock par value $.001 per share (the "Preferred Stock"). This Preferred Stock
shall pay an annual dividend based on a 365 day calendar year of 4% of the
Liquidation Value (as defined in Section 3 hereof) ("Dividend Rate"), payable
semiannually within ten (10) business days after each subsequent June 30th and
December 31st (each a "Dividend Declaration Date"), and shall be payable in cash
or shares of the Corporation's par value $.001 per share common stock (Common
Stock) at the Corporation's option. The first Dividend Declaration Date shall be
December 31st, 1998.

In the event that the Corporation elects to pay the accrued dividends due as
of a Dividend Declaration Date on the outstanding shares of Preferred Stock in
Common Stock of the Corporation, the Holder of each share of Preferred Stock
shall receive that number of shares of Common Stock equal to the product of (a)
the quotient of (i) the Dividend Rate divided by (ii) the average of' the
closing bid quotation of the Corporation's Common Stock as reported on the
National Association of Securities Dealers Automated Quotation system
("NASDAQ"), or if the Common Stock is not listed for trading on the NASDAQ but
is listed for trading on a national securities exchange, the average closing bid
price of the Common Stock as quoted on such national exchange, for the five (5)
trading days immediately prior to the Dividend Declaration Date (the "Stock
Dividend Price"), times (b) a fraction, the numerator of which is the number of
days elapsed during the period for which the dividend is to be paid, and the
denominator of which is 365. Dividends on the Preferred Stock shall be
cumulative, and no dividends or other distributions shall be paid or declared or
set aside for payment on the Corporation's Common Stock until all accrued and
unpaid dividends on all outstanding shares of Preferred Stock shall have been
paid or declared and set aside for payment.
 


-1-


2. Voting.

Except as provided under Section 242 of the GCL, holders of Preferred Stock
(the "Holders") shall not have the right to vote on any matter. Notwithstanding
the provisions of Section 242 of the GCL or Section 4 hereof, the number of
authorized shares of any class or classes of stock of the Corporation may be
increased or decreased (but not below the number of shares thereof outstanding)
by the affirmative vote of the holders of a majority of the stock of the
Corporation entitled to vote thereon, voting together as a single class,
irrespective of the provisions of Section 242 of the GCL.

3.  Liquidation.

In the event of a voluntary or involuntary dissolution, liquidation, or
winding up of the Corporation, the Holders of Preferred Stock shall be entitled
to receive out of the assets of the Corporation legally available for
distribution to holders of its capital stock, before any payment or distribution
shall be made to holders of shares of Common Stock or any other class of stock
ranking junior to the Preferred Stock, an amount per share of Preferred Stock
equal to $1,000 (the "Liquidation Value") plus any accrued and unpaid dividends
on the Preferred Stock. If upon such liquidation, dissolution, or winding up of
the Corporation, whether voluntary or involuntary, the assets to be distributed
among the Holders of Preferred Stock shall be insufficient to permit payment to
the Holders of Preferred Stock of the amount distributable as aforesaid, then
the entire assets of the Corporation to be so distributed shall be distributed
ratably among the Holders of Preferred Stock and shares of such other classes or
series ranking on a parity with the shares of this Preferred Stock in proportion
to the full distributable amounts for which holders of all such parity shares
are entitled upon such distribution, liquidation, or winding up. Upon any such
liquidation, dissolution or winding up of the Corporation, after the Holders of
Preferred Stock shall have been paid in full the amounts to which they shall be
entitled, the remaining net assets of the Corporation may be distributed to the
holders of stock ranking on liquidation junior to the Preferred Stock and the
Holders of the Preferred Stock shall have no right or claim to any of the
remaining assets of the Corporation. Written notice of such liquidation,
dissolution or winding up, stating a payment date, the amount of the liquidation
payments and the place where said liquidation payments shall be payable, shall
be given by mail, postage prepaid or by telex or facsimile to non-U.S.
residents, not less than 10 days prior to the payment date stated therein, to
the Holders of record of Preferred Stock, such notice to be addressed to each
such Holder at its address as shown by the records of the Corporation. For
purposes hereof the shares of Common Stock, shall rank on liquidation junior to
the Preferred Stock.

4. Restrictions.

The Corporation will not amend or modify the terms of its Restated
Certificate of Incorporation so as to adversely alter or change the Preferred
Stock at any time when shares of Preferred Stock are outstanding, without the
approval of the Holders of at least a majority of the then outstanding shares of
Preferred Stock given in writing or
 


-2-


by vote at a meeting, consenting or voting (as the case may be) separately as
a series, except where the vote or written consent of the Holders of a greater
number of shares of Common Stock of the Corporation is required by law or by the
Corporation's Certificate of Incorporation, as amended.

5. Optional Conversion.

The Holders of shares of Preferred Stock shall have the following conversion
rights to convert the shares of Preferred Stock into shares of Common Stock of
the Corporation:

(a)    No Right to Convert. The Preferred Stock shall not be
convertible into shares of Common Stock until after July 15, 2000.

(b)    Conversion Dates. The Preferred Stock may be convertible
into shares of Common Stock at any time after July 15, 2000.

(c)    Right to Convert; Conversion Price. Subject to the terms
hereof, as used herein, the term Conversion Price per outstanding share of
Preferred Stock shall be One Dollar and 875/100 ($1.875); except that after the
expiration of one hundred and eighty (180) days after the Closing Date if the
average of the closing bid price per share of Common Stock quoted on the NASDAQ
(or the closing bid price of the Common Stock as quoted on the national
securities exchange if the Common Stock is not listed for trading on the NASDAQ
but is listed for trading on a national securities exchange) for the five (5)
trading days immediately prior to the particular date of each Conversion Notice
(as defined below) is less than Two Dollars and 34/100 ($2.34), then the
Conversion Price for that particular conversion shall be eighty percent (80%) of
the average of the closing bid price of the Common Stock on the NASDAQ (or if
the Common Stock is not listed for trading on the NASDAQ but is listed for
trading on a national securities exchange then eighty percent (80%) of the
average of the closing bid price of the Common Stock on the national securities
exchange) for the five (5) trading days immediately prior to the particular date
of the Conversion Notice. Notwithstanding the foregoing, the Conversion Price
shall not be less than a minimum of $1.50 per share ("Minimum Conversion Price")
for a period of twenty-four (24) months from the date of issuance of the
Preferred Stock. 

          If any of the outstanding shares of Preferred Stock are converted, in whole
or in part, into Common Stock pursuant to the terms of this Section 5(b), the
number of shares of whole Common Stock to be issued to the Holder as a result of
such conversion shall be determined by dividing (a) the aggregate Stated Value
of the Preferred Stock so surrendered for conversion by (b) the Conversion Price
in effect on the date of that particular Conversion Notice relating to such
conversion. At the time of conversion of shares of the Preferred Stock, the
Corporation shall pay in cash to the holder thereof an amount equal to all
unpaid and accrued dividends, if any, accrued thereon on the shares of Preferred
so converted to the date of the Conversion Notice relating to such conversion,
or, at the Corporation's option, in lieu of paying cash for the accrued and
unpaid dividends, issue that number of shares of whole Common Stock which is
equal to the quotient of the amount of such unpaid and accrued dividends to the
date of the Conversion Notice 
 


-3-


relating to such conversion of the shares of Preferred Stock so converted
divided by the Stock Dividend Price, in effect at the date of the Conversion
Notice relating to such conversion.

(c)  Conversion Notice. The right of conversion shall be
exercised by the Holder thereof by telecopying or faxing an executed and
completed written notice signed by an authorized representative of the Holder,
("Conversion Notice") to the Corporation that the Holder elects to convert a
specified number of shares of Preferred Stock representing a specified Stated
Value thereof into shares of Common Stock and by delivering by express courier
the certificate or certificates of Preferred Stock being converted to the
Corporation at its principal office (or such other office or agency of the
Corporation as the Corporation may designate by notice in writing to the Holders
of the Preferred Stock). The business date indicated on a Conversion Notice
which is telecopied to and received by the Corporation in accordance with the
provisions hereof shall be deemed a Conversion Date. The Conversion Notice shall
include therein the Stated Value of shares of Preferred Stock to be converted,
and a calculation (a) of the Stock Dividend Price, (b) the Conversion Price, and
(c) the number of Shares of Common Stock to be issued in connection with such
conversion. The Corporation shall have the right to review the calculations
included in the Conversion Notice, and shall provide notice of any discrepancy
or dispute therewith within three (3) business days of the receipt thereof. The
Holder shall deliver to the Corporation an original Conversion Notice and the
original Preferred to be converted within three (3) business days from the date
of the Conversion Notice.

(d)  Issuance of Certificates - Time Conversion Effected.
Promptly, but in no event more than six (6) business days,
after the receipt by facsimile of the Conversion Notice referred to in
Subparagraph (5)(c); and provided within the six (6) business days the
Corporation receives the certificate or certificates for the shares of Preferred
Stock to be converted, the Corporation shall issue and deliver, or cause to be
issued and delivered, to the Holder, registered in the name of the Holder, a
certificate or certificates for the number of whole shares of Common Stock into
which such shares of Preferred Stock are converted. Such conversion shall be
deemed to have been effected as of the close of business on the date on which
the telecopy or facsimile Conversion Notice shall have been received by the
Corporation, and the rights of the Holder of such share or shares of Preferred
Stock shall cease, at such time, and the Holder or Holders shall be deemed to
have become the Holder or Holders of record of the shares of Common Stock
represented thereby. 

In the event that the shares of Common Stock issuable upon conversion of the
Preferred, is not delivered within six (6) business days of the date the Company
receives the Conversion Notice, the Company shall pay to the Buyer, by wire
transfer, as liquidated damages for such failure and not as a penalty, for each
$100,000 of Preferred sought to be converted, $500 for each of the first five
(5) calendar days and $1,000 per calendar day thereafter that the shares of
Common Stock are not delivered, which liquidated damages shall begin to run from
the seventh (7th) business day after the Conversion Date. Any and all payments
required pursuant to this paragraph shall be payable only in cash.
Notwithstanding the above, liquidated damages shall not exceed $2,000.00 per
day. In addition to the liquidated damages set forth herein, in the event the
Company fails to deliver the shares of Common Stock within six (6) business days
after the Conversion date, the
 


-4-


Company agrees to issue the larger number of shares of Common Stock derived
from (i) the original Conversion Notice, or (ii) utilizing the five lowest
closing bid prices of the Company's shares of Common Stock beginning on the
Conversion Date and ending on the day the shares of Common Stock are delivered.
The Company understands that a delay in the issuance of the shares of Common
Stock could result in economic loss to the Holder. Nothing contained herein, or
in the Preferred shall limit the Holder's rights to pursue actual damages for
the Company's failure to issue and deliver shares of Common Stock to the Holder
in accordance with the terms of the Certificate of Designations, and this
Agreement. 

(e)  Fractional Shares of Common Stock. No fractional shares
of Common Stock shall be issued upon conversion of any Preferred Stock into
shares of Common Stock. All fractional shares of Common Stock shall be
aggregated and then rounded down to the nearest whole share of Common Stock. In
case the number of shares of Preferred Stock represented by the certificate or
certificates surrendered pursuant to Subparagraph 5(b) exceeds the number of
shares of Common Stock converted, the Corporation shall, upon such conversion,
execute and deliver to the Holder, at the expense of the Corporation, a new
certificate or certificates for the number of shares of Preferred Stock
represented by the certificate or certificates surrendered which are not to be
converted.

(f)  Merger or Consolidation. In case of either (a) any
merger or consolidation to which the Corporation is a party (collectively, the
"Merger"), other than a Merger in which the Corporation is the surviving or
continuing corporation, or (b) any sale or conveyance to another corporation of
all, or substantially all, of the assets of the Corporation (collectively, the
"Sale"), and such Merger or Sale becomes effective (x) while any shares of
Preferred Stock are outstanding and prior to the date that the Corporation's
Registration Statement covering all the shares of Common Stock issuable upon the
conversion of the Preferred Stock is declared effective by the U.S. Securities
and Exchange Commission ("Commission"), the Corporation or such successor
corporation as the case may be, shall make appropriate provision so that the
Holder of each share of Preferred Stock then outstanding shall have the right to
convert such share of Preferred Stock into the kind and amount of shares of
stock or other securities and property receivable upon such Merger or Sale by a
holder of the number of shares of Common Stock into which such shares of
Preferred Stock could have been converted into immediately prior to such Merger
or Sale, subject to adjustments which shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Section 5.

In the event of a Merger or Sale, where the Corporation is not the surviving
Corporation, the Holder shall have the right to redeem all of the outstanding
shares of Preferred Stock at 120% of the Liquidation Value of each share of
Preferred Stock then outstanding plus all accrued and unpaid dividends (the
"Redemption Amount"). The Corporation shall pay this Redemption Amount in cash
within ten (10) business days of receipt by the Corporation of notice from the
Holder, and receipt by the Corporation of all outstanding shares of Preferred
Stock duly endorsed by the Holder to the Corporation.



-5-


(g)  Adjustments to Conversion Price for Stock Dividends and for Combinations
or Subdivisions of Common Stock. If the Corporation at any time or from time to
time while shares of Preferred Stock are issued and outstanding shall declare or
pay, any dividend on the Common Stock payable in Common Stock, or shall effect a
subdivision of the outstanding shares of Common Stock into a greater number of
shares of Common Stock (by stock split, reclassification or otherwise than by
payment of a dividend in Common Stock), or if the outstanding shares of Common
Stock shall be combined or consolidated, by reclassification or otherwise, into
a lesser number of shares of Common Stock, then the Conversion Price in effect
immediately before such event shall, concurrently with the effectiveness of such
event, be proportionately decreased or increased, as appropriate.

(h)  Adjustments for Reclassification and Reorganization. If
the Common Stock issuable upon conversion of the Preferred Stock shall be
changed into the same or a different number of shares of Common Stock of any
other class or classes of stock, whether by capital reorganization,
reclassification or otherwise (other than a subdivision or combination or shares
of Common Stock provided for in Section 5(g) hereof), the Conversion Price then
in effect shall, concurrently with the effectiveness of such reorganization or
reclassification, be proportionately adjusted so that the Preferred Stock shall
be convertible into, in lieu of the number of shares of Common Stock which the
holders of Preferred Stock would otherwise have been entitled to receive, a
number of shares of Common Stock of such other class or classes of stock
equivalent to the number of shares of Common Stock that would have been subject
to receipt by the holders upon conversion of the Preferred Stock immediately
before that change.

6 Redemption.

(a)  Redemption at Corporation's Option. Except as otherwise
provided in this Section 6, at any time, and from time to time, the Corporation
may, at its sole option, but shall not be obligated to, redeem, in whole or in
part, at any time, and from time to time (i) for a period of 120 days from the
date of issuance of the Preferred Stock up to an aggregate of 450 shares of
Series 13 Class M Preferred Stock at the cash redemption price of $1,000 per
share and (ii) the then outstanding Series 13 Class M Preferred Stock at the
following cash redemption prices if redeemed during the following periods:
(a) within one year from July 15, 1999 -
$1,100 per share, except as otherwise provided in (i) above, and (b) after one
year from July 15, 1999 - $1,200 per share (as applicable, the
redemption price of $1,000, $1,100 or $1,200 is referred to herein as the
"Redemption Price").

(b)  Mechanics of Redemption. Prior to any date stipulated by
the Corporation for the redemption of Series 13 Class M Preferred Stock (the
"Redemption Date"), written notice (the "Redemption Notice") shall be mailed to
each holder of record on such notice date of the Series 13 Class M Preferred
Stock. The Redemption Notice shall state: (i) the Redemption Date of such
shares, (ii) the number of Series 13 Class M Preferred Stock to be redeemed from
the holder to whom the Redemption Notice is addressed, (iii) instructions for
surrender to the Corporation, in the manner and at the place designated, of a
share certificate or share certificates representing the number of Series 13
Class M Preferred Stock to be redeemed from such holder, and (iv)



-6-


instructions as to how to specify to the Corporation the number of Series 13
Class M Preferred Stock to be redeemed as provided in this Part 6 and, if the
Redemption Notice is mailed to the Holder after the first year from the date of
issuance of the Series 13 Class M Preferred Stock, the number of shares to be
converted into Common Stock as provided in Part 5 hereof.

(c)  Rights of Conversion Upon Redemption. If the redemption
occurs during the first 12 months after the issuance of the Preferred Stock, the
holder may not convert any redeemed shares. If the redemption occurs after the
first year after the first issuance of Series 13 Class M Preferred Stock, then,
upon receipt of the Redemption Notice, any holder of Series 13 Class M Preferred
Stock shall have five business days during which it may exercise the option, at
its sole election, to specify what portion of its Series 13 Class M Preferred
Stock called for redemption in the Redemption Notice shall be redeemed as
provided in this Part 6 or converted into Common Stock in the manner provided in
Part 5 hereof, except that, notwithstanding any provision of such Part 5 to the
contrary, after one year from the date of first issuance of the Preferred Stock,
such holder shall have the right to convert into Common Stock that number of
Series 13 Class M Preferred Stock called for redemption in the Redemption
Notice.

(d)  Surrender of Certificates. On or before the Redemption
Date in respect of any Series 13 Class M Preferred Stock, each holder of such
shares shall surrender the required certificate or certificates representing
such shares to the Corporation in the manner and at the place designated in the
Redemption Notice, and upon the Redemption Date, the Redemption Price for such
shares shall be made payable, in the manner provided hereof, to the order of the
person whose name appears on such certificate or certificates as the owner
thereof, and each surrendered share certificate shall be canceled and retired.
If a share certificate is surrendered and all the shares evidenced thereby are
not being redeemed (as described below), the Corporation shall cause the Series
13 Class M Preferred Stock which are not being redeemed to be registered in the
names of the persons or entity whose names appear as the owners on the
respective surrendered share certificates and deliver such certificate to such
person.

(e)  Payment. On the Redemption Date in respect of any Series
13 Class M Preferred Stock or prior thereto, the Corporation shall deposit with
any bank or trust company having a capital and surplus of at least $50,000,000,
as a trust fund, a sum equal to the aggregate Redemption Price of all such
shares called from redemption (less the aggregate Redemption Price for those
Series 13 Class M Preferred Stock in respect of which the Corporation has
received notice from the holder thereof of its election to convert Series 13
Class M Preferred Stock into Common Stock), with irrevocable instructions and
authority to the bank or trust company to pay, on or after the Redemption Date,
the Redemption Price to the respective holders upon the surrender of their share
certificates. The deposit shall constitute full payment for the shares to their
holders, and from and after the date of the deposit the redeemed shares shall be
deemed to be no longer outstanding, and holders thereof shall cease to be
shareholders with respect to such shares and shall have no rights with respect
thereto except the rights to receive from the bank or trust company payments of
the Redemption Price of the shares, without interest, upon surrender of their
certificates thereof. Any funds so deposited and unclaimed at the end of one
year following the Redemption Date shall be released or repaid



-7-


to the Corporation, after which the former holders of shares called for
redemption shall be entitled to receive payment of the Redemption Price in
respect of their shares only from the Corporation.

7. Assignment. 

Subject to all applicable restrictions on transfer, the rights and
obligations of the Corporation and the Holder of the Preferred Stock shall be
binding upon and benefit the successors, assigns, heirs, administrators, and
transferees of the parties.

8. Shares of Common Stock to be
Reserved.

The Corporation, upon the effective date of this Certificate of Designations,
has a sufficient number of shares of Common Stock available to reserve for
issuance upon the conversion of all outstanding shares of Preferred Stock,
pursuant to the terms and conditions set forth in Section 5, and exercise of the
Warrants as defined in Section 12. The Corporation will at all times reserve and
keep available out of its authorized shares of Common Stock, solely for the
purpose of issuance upon the conversion of Preferred Stock, and exercise of the
Warrants, as herein provided, such number of shares of Common Stock as shall
then be issuable upon the conversion of all outstanding shares of Preferred
Stock, and exercise of the Warrants. The Corporation covenants that all shares
of Common Stock which shall be so issued shall be duly and validly issued, fully
paid and non assessable. The Corporation will take such action as may be
required, if the total number of shares of Common Stock issued and issuable
after such action upon conversion of the Preferred Stock, and exercise of the
Warrants would exceed the total number of shares of Common Stock then authorized
by the Corporation's Certificate of Incorporation, as amended, or would exceed
19.99% of the shares of Common Stock then outstanding if required by law or the
Rules and Regulations of NASDAQ or the National Securities Exchange applicable
to the Corporation to take such action as a result of exceeding such 19.99%, in
order to increase the number of shares of Common Stock to permit the Corporation
to issue the number of shares of Common Stock required to effect conversion of
the Preferred, and exercise of the Warrants, to a number sufficient to permit
conversion of the Preferred Stock, and exercise of the Warrants, including,
without limitation, engaging in reasonable efforts to obtain the requisite
stockholder approval of any necessary amendment to the Corporation's Restated
Certificate of Incorporation, and to obtain shareholders approval in order to
effect conversion of the Preferred Stock, and exercise of the Warrants, if
required by law or the rules or regulations of the NASDAQ or National Securities
Exchange applicable to the Corporation.

8(a)  Shareholder Approval. In connection
with the issuance to the Holder of the shares of Preferred Stock, pursuant to
this Certificate of Designations, the Corporation is also issuing (i) certain
warrants ("RBB Warrants") to the Holder pursuant to the terms of that certain
Private Securities Subscription Agreement dated June 30, 1998 (the "Agreement"),
providing for the purchase of up to 150,000 shares of Common Stock at an
exercise price of $2.50 per share and (ii) certain warrants (collectively, the
"Liviakis Warrants") to Liviakis Financial Communication, Inc. ("Liviakis") and
Robert B. Prag providing for the
 


-8-


purchase of up to an aggregate of 2,500,000 shares of Common Stock at an
exercise price of $1.875 per share pursuant to the terms of that Liviakis
Agreement dated June 30, 1998, between Liviakis and the Corporation.

If (i) the aggregate number of shares of Common Stock issued by the
Corporation as a result of any or all of the following: (a) conversion of the
Preferred Stock, (b) payment of dividends accrued on the Preferred Stock (c)
exercise of the RBB Warrants, and (d) exercise of the Liviakis Warrants exceeds
2,388,347 shares of Common Stock (which equals 19.9% of the outstanding shares
of Common Stock of the Corporation as of the date of this Certificate of
Designations) and (ii) the Holder has converted or elects to convert any of the
then outstanding shares of Preferred Stock pursuant to the terms of Section 5 at
a Conversion Price less than $ 1.875 ($1.875 being the market value per share of
Common Stock as quoted on the NASDAQ as of the close of business on June 30,
1998) pursuant to the terms of Section 5(b) hereof, other than if the Conversion
Price is less than $ 1.875 solely as a result of the anti-dilution provisions of
Section 5(g) and (h) hereof, then, notwithstanding anything in Section 5 to the
contrary, the Corporation shall not issue any shares of Common Stock as a result
of receipt of a Conversion Notice unless and until the Corporation shall have
obtained approval of its shareholders entitled to vote on the transactions in
accordance with subparagraphs (25)(H)(i)d, (iv) and (v) of Rule 4310 of the
NASDAQ Marketplace Rules ("Shareholder Approval").

If Shareholder Approval is required as set forth in the above paragraph, the
Corporation shall take all necessary steps to obtain such Shareholder Approval
upon receipt of the Conversion Notice triggering the need for Shareholder
Approval ("Current Conversion Notice"). If the Corporation has not received from
the Holder a Current Conversion Notice, the Holder, subsequent to January 1st,
1999 may, if the Corporation's shares of Common Stock trade, subsequent to
January 1st, 1999, at a five (5) day average closing bid price below Two Dollars
and 34/00 ($2.34), upon written notice to the Corporation, require the
Corporation to obtain Shareholder Approval ("Holder's Notice"). The Holder and
the Corporation's officers and directors covenant to vote all shares of Common
Stock over which they have voting control in favor of Shareholder Approval. If
the Corporation does not obtain Shareholder Approval within ninety (90) days of
the earlier of the Corporation's receipt of (i) the Current Conversion Notice or
(ii) the Holder's Notice, and the Holder has not breached its covenant to vote
all shares of Common Stock over which they have voting control in favor of
Shareholder Approval, the Corporation shall pay in cash to the Holder
liquidated damages, in an amount of 4% per month of the Liquidation Value of
each share of Preferred Stock then outstanding, commencing on the 91st day of
the Corporation's receipt of the Holder's Current Conversion Notice, and
continuing every thirty (30) days pro-rata until such time the Corporation
receives Shareholder Approval.

9.    No Reissuance of Series 13 Class M Convertible
Preferred Stock.

Shares of Preferred Stock which are converted into shares of Common Stock as
provided herein shall be retired and shall become authorized but unissued shares
of Preferred Stock, which may be reissued as part of a new series of Preferred
stock hereafter created.
 


-9-


10.  Closing of Books.

The Corporation will at no time close its transfer books against the transfer
of any Preferred Stock or of any shares of Common Stock issued or issuable upon
the conversion of any shares of Common Stock of Preferred Stock in
any manner which interferes with the timely conversion of such
Preferred Stock, except as may otherwise be required to comply with applicable
securities laws.

11.  No Preemptive Rights.

The Preferred Stock shall not give its holders any preemptive rights to
acquire any other securities issued by the Corporation at any time in the
future.

12.  Definition of Shares.

As used in this Certificate of Designations, the term "shares of Common
Stock" shall mean and include the Corporation's authorized common stock, par
value $.001, as constituted on the date of filing of these terms of the
Preferred Stock, or in case of any reorganization, reclassification, or stock
split of the outstanding shares of Common Stock thereof, the stock, securities
or assets provided for hereof. The term "Warrants" as used herein shall have the
same meaning as defined in Section 1 of the Private Securities Subscription
Agreement, dated June 30, 1998, between the Company and RBB Bank
Aktiengesellschaft.

The said determination of the designations, preferences and relative,
participating, optional or other rights, and the qualifications, limitations or
restrictions thereof, relating to the Preferred Stock was duly made by the Board
of Directors pursuant to the provisions of the Corporation's Restated
Certificate of Incorporation and in accordance with the provisions of the
Delaware General Corporation Law.
 
 

 

 

 



-10-


STATE OF DELAWARE    

SECRETARY OF STATE    

DIVISION OF CORPORATIONS

FILED 12:33 PM -- 07/15/1999

991291292 -- 2249849      



CERTIFICATE OF ELIMINATION

OF

SERIES 3 CLASS C CONVERTIBLE PREFERRED STOCK

AND

SERIES 8 CLASS H CONVERTIBLE PREFERRED STOCK

AND

SERIES 10 CLASS J CONVERTIBLE PREFERRED STOCK

OF

PERMA-FIX ENVIRONMENTAL SERVICES, INC.

____________________________________________


          PERMA-FIX ENVIRONMENTAL SERVICES, INC., a corporation organized and existing
under the General Corporation Law of the State of Delaware (hereinafter called
the "Corporation"), hereby certifies the following:

      1.     That the Certificate of Designations of Series 3 Class C Convertible
Preferred Stock, par value $.001 per share, of the Corporation (the "Series 3
Preferred") was filed with the Delaware Secretary of State on July 19, 1996 (the
"Series 3 Certificate of Designations").

     2.     That all outstanding shares of the Series 3 Preferred have been delivered
to the Company and exchanged pursuant to an agreement with the holder thereof in
accordance with the terms and conditions of a certain Exchange Agreement between
the Company and RBB Bank Aktiengesellschaft, dated as of July 15, 1999.

     3.     That no shares of Series 3 Preferred remain outstanding.

      4.    That all shares of the Series 3 Preferred which have been exchanged have
the status of authorized and unissued shares of the Preferred Stock of the
Corporation without designation as to series, until such shares are once more
designated as part of a particular series by the Board of Directors.

     5.     That effective July 15, 1999, the Board of Directors of the Company duly
adopted the following resolutions:

              RESOLVED, that upon completion of the exchange with the holder of the Series
3

              Class C Convertible Preferred Stock, no authorized shares of Series 3 Class C 

              Convertible Preferred Stock will remain outstanding and no shares of Series 3 

              Class C Convertible Preferred Stock will be issued subject to the Certificate of 

              Designations previously filed with respect to the Series 3 Class C Convertible 

              Preferred Stock.

              FURTHER RESOLVED, that upon completion of the exchange, the officers of the 

              Company are hereby authorized and directed, for and on behalf of the Company, to 

              execute and deliver an appropriate Certificate of Elimination to the Secretary
of State 

              of Delaware regarding the Series 3 Class C Convertible Preferred
Stock.

     6.     That the Certificate of Designations of the Series 8 Class H Convertible
Preferred Stock, par value $.001 per share, of the Corporation (the "Series 8
Preferred") was filed on July 16, 1998 (the "Series 8 Certificate of
Designations").

     7.     That all outstanding shares of the Series 8 Preferred have been delivered
to the Company and exchanged pursuant to an agreement with the holder thereof in
accordance with the terms and conditions of a certain Exchange Agreement between
the Company and RBB Bank, dated as of July 15, 1999.

     8.     That no shares of Series 8 Preferred remain outstanding.

     9.     That all shares of the Series 8 Preferred which have been exchanged have
the status of authorized and unissued shares of the Preferred Stock of the
Corporation without designation as to series, until such shares are once more
designated as part of a particular series by the Board of Directors.

     10.    That effective July 15, 1999, the Board of Directors of the Company duly
adopted the following resolutions:

               RESOLVED, that upon completion of the exchange with the holder of the Series
8 

               Class H Convertible Preferred Stock, no authorized shares of Series 8 Class H 

               Convertible Preferred Stock will remain outstanding and no shares of Series 8 

               Class H Convertible Preferred Stock will be issued subject to the Certificate of 

               Designations previously filed with respect to the Series 8 Class H Convertible 

               Preferred Stock.

               FURTHER RESOLVED, that upon completion of the exchange, the officers of the 

              Company are hereby authorized and directed, for and on behalf of the Company, to 

              execute and deliver an appropriate Certificate of Elimination to the Secretary
of State 

              of Delaware regarding the Series 8 Class H Convertible Preferred Stock.


     11.    That the Certificate of Designations of the Series 10 Class J Convertible
Preferred Stock, par value $.001 per share, of the Corporation (the "Series 10
Preferred") was filed on July 10, 1998 (the "Series 10 Certificate of
Designations").

     12.     That all outstanding shares of the Series 10 Preferred have been
delivered to the Company and exchanged pursuant to an agreement
 


-2-


with the holder thereof in accordance to the terms and conditions of a
certain Exchange Agreement between the Company and RBB Bank, dated as of July
15, 1999.

      13.    That no shares of Series 10 Preferred remain outstanding.

      14.    That all shares of the Series 10 Preferred which have been exchanged have
the status of authorized and unissued shares of the Preferred Stock of the
Corporation without designation as to series, until such shares are once more
designated as part of a particular series by the Board of Directors.

      15.    That effective July 15, 1999, the Board of Directors of the Company duly
adopted the following resolutions:

                RESOLVED, that upon completion of the exchange with the holder of the Series
10 

                Class J Convertible Preferred Stock, no authorized shares of Series 10 Class
J 

                Convertible Preferred Stock will remain outstanding and no shares of Series 10 

                Class J Convertible Preferred Stock will be issued subject to the Certificate of 

                Designations previously filed with respect to the Series 10 Class J Convertible 

                Preferred Stock.

                FURTHER RESOLVED, that upon completion of the exchange, the officers of the 

                Company are hereby authorized and directed, for and on behalf of the Company, to 

                execute and deliver an appropriate Certificate of Elimination to the Secretary
of State 

                of Delaware regarding the Series 10 Class J Convertible Preferred
Stock. 

     16.    That pursuant to the provisions of Section 151(g) of the Delaware General
Corporation Law, upon the effective date of the filing of this Certificate, this
Certificate will have the effect of eliminating from the Restated Certificate of
Incorporation only those matters set forth in the Restated Certificate of
Incorporation with respect to the Series 3 Class C Convertible Preferred Stock,
the Series 8 Class H Convertible Preferred Stock, and the Series 10 Class J
Convertible Preferred Stock

          IN WITNESS WHEREOF, this Certificate of Elimination has been executed this
15th day of July, 1999, by the President of the Company.

                                                                                PERMA-FIX ENVIRONMENTAL

ATTEST:                                                                 SERVICES, INC.



/s/ Richard T. Kelecy                                                 By
 /s/ Louis Centofanti                           

Richard T. Kelecy, Secretary                                          Dr. Louis F. Centofanti, President
(SEAL)
 


-3-


STATE OF DELAWARE    

SECRETARY OF STATE    

DIVISION OF CORPORATIONS

FILED 12:30 PM -- 08/10/1999

991331578 -- 2249849     



CERTIFICATE OF DESIGNATIONS

OF SERIES 14 CLASS N CONVERTIBLE PREFERRED STOCK

OF

PERMA-FIX ENVIRONMENTAL SERVICES, INC.


          Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation
organized and existing under the General Corporation Law of the State of
Delaware, does hereby certify:

          That, pursuant to authority conferred upon by the Board of Directors by the
Corporation's Restated Certificate of Incorporation, as amended, and pursuant to
the provisions of Section 151 of the Delaware Corporation Law, the Board of
Directors of the Corporation has adopted resolutions, a copy of which is
attached hereto, establishing and providing for the issuance of a series of
Preferred Stock designated as Series 14 Class N Convertible Preferred Stock and
has established and fixed the voting powers, designations, preferences and
relative participating, optional and other special rights and qualifications,
limitations and restrictions of such Series 14 Class N Convertible Preferred
Stock as set forth in the attached resolutions.

Dated: August 10, 1999                                            PERMA-FIX ENVIRONMENTAL

                                                                                 SERVICES, INC. 



                                                                                  By /s/ Louis Centofanti                               

                                                                                        Dr. Louis F. Centofanti

                                                                                        Chairman of the Board
ATTEST:


/s/ Richard T. Kelecy                         

Richard T. Kelecy, Secretary
 

 

 

 



PERMA-FIX ENVIRONMENTAL SERVICES, INC.

(the "Corporation")



RESOLUTION OF THE BOARD OF DIRECTORS

FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,

RESTRICTIONS AND CONDITIONS ATTACHING TO THE

SERIES 14 CLASS N CONVERTIBLE PREFERRED STOCK


WHEREAS,

A.    The Corporation's share capital includes Preferred Stock, par value $.001
per share 

        ("Preferred Stock"), which Preferred Stock may be issued in one or
more series by the 

         Board of Directors of the Corporation (the "Board") being
entitled by resolution to fix the 

         number of shares in each series and to
designate the rights, designations, preferences, and 

         relative, participating,
optional or other special rights, privileges, restrictions and conditions 

         attaching to the shares of each such series; and

B.    It is in the best interests of the Corporation for the Board to create a
new series from the 

        Preferred Stock designated as the Series 14 Class N
Convertible Preferred Stock, par value $.001.

NOW, THEREFORE, BE IT RESOLVED, THAT:

The Series 14 Class N Convertible Preferred Stock, par value $.001 (the
"Series 14 Class N Preferred Stock") of the Corporation shall consist of 1,769
shares and no more and shall be designated as the Series 14 Class N Convertible
Preferred Stock, and the preferences, rights, privileges, restrictions and
conditions attaching to the Series 14 Class N Preferred Stock shall be as
follows:

Part 1 - Voting and Preemptive Rights.

1.1    Voting Rights. Except as otherwise provided
herein, in the Corporation's Certificate of Incorporation (the "Articles") or
the General Corporation Law of the State of Delaware (the "GCL"), the holders of
the Series 14 Class N Preferred Stock shall have no voting rights whatsoever. To
the extent that under the GCL the vote of the holders of the Series 14 Class N
Preferred Stock, voting separately as a class or series as applicable, is
required to authorize a given action of the Corporation, the affirmative vote or
consent of the holders of at least a majority of the shares of the Series 14
Class N Preferred Stock represented at a duly held meeting at which a quorum is
present or by written consent of a majority of the shares of Series 14 Class N
Preferred Stock (except as otherwise may be required under the GCL) shall
constitute the approval of such action by the series. To the extent that under
the GCL the holders of the Series 14 Class N



-2-


Preferred Stock are entitled to vote on a matter with holders of
Corporation's Common Stock and/or any other class or series of the Corporation's
voting securities, the Series 14 Class N Preferred Stock, the Corporation's
Common Stock and all other classes or series of the Corporation's voting
securities shall vote together as one class, with each share of Series 14 Class
N Preferred Stock entitled to a number of votes equal to the number of shares of
the Corporation's Common Stock into which it is then convertible using the
record date for the taking of such vote of stockholders as the date as of which
the Conversion Price (as defined in Section 4.3 hereof) is calculated and
conversion is effected. Holders of the Series 14 Class N Preferred Stock shall
be entitled to notice of (and copies of proxy materials and other information
sent to stockholders) for all shareholder meetings or written consents with
respect to which they would be entitled to vote, which notice would be provided
pursuant to the Corporation's bylaws and applicable statutes.

1.2    No Preemptive Rights. The Series 14 Class N
Preferred Stock shall not give its holders any preemptive rights to acquire any
other securities issued by the Corporation at any time in the future.

Part 2 - Liquidation Rights.

2.1    Liquidation. If the Corporation shall be
voluntarily or involuntarily liquidated, dissolved or wound up at any time when
any shares of the Series 14 Class N Preferred Stock shall be outstanding, the
holders of the then outstanding Series 14 Class N Preferred Stock shall have a
preference in distribution of the Corporation's property available for
distribution to the holders of the Corporation's Common Stock equal to $1,000
consideration per outstanding share of Series 14 Class N Preferred Stock, plus
an amount equal to all unpaid dividends accrued thereon to the date of payment
of such distribution ("Liquidation Preference"), whether or not declared by the
Board.

2.2    Payment of Liquidation Preferences. Subject to
the provisions of Part 6 hereof, all amounts to be paid as Liquidation
Preference to the holders of Series 14 Class N Preferred Stock, as provided in
this Part 2, shall be paid or set apart for payment before the payment or
setting apart for payment of any amount for, or the distribution of any of the
Corporation's property to the holders of the Corporation's Common Stock, whether
now or hereafter authorized, in connection with such liquidation, dissolution or
winding up.

2.3    No Rights After Payment. After the payment to the
holders of the shares of the Series 14 Class N Preferred Stock of the full
Liquidation Preference amounts provided for in this Part 2, the holders of the
Series 14 Class N Preferred Stock as such shall have no right or claim to any of
the remaining assets of the Corporation.

2.4    Assets Insufficient to Pay Full Liquidation
Preference. In the event that the assets of the Corporation
available for distribution to the holders of shares of the Series 14 Class N
Preferred Stock upon any dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, shall be insufficient to pay in
full all



-3-


amounts to which such holders are entitled pursuant to this Part 2, no such
distribution shall be made on account of any shares of any other class or series
of Preferred Stock ranking on a parity with the shares of this Series 14 Class N
Preferred Stock upon such dissolution, liquidation or winding up unless
proportionate distributive amounts shall be paid on account of the shares of
this Series 14 Class N Preferred Stock and shares of such other class or series
ranking on a parity with the shares of this Series 14 Class N Preferred Stock,
ratably, in proportion to the full distributable amounts for which holders of
all such parity shares are respectively entitled upon such dissolution,
liquidation or winding up.

Part 3 - Dividends.

3.1    The holders of the Series 14 Class N Preferred Stock are entitled to
receive if, when and as declared by the Board out of funds legally available
therefor, cumulative dividends, payable in cash or Common Stock of the
Corporation, par value $.001 per share (the "Common Stock"), at the
Corporation's election, at the rate of six percent (6%) per annum of the
Liquidation Value of the Series 14 Class N Preferred Stock. The Liquidation
Value of the Series 14 Class N Preferred Stock shall be $1,000.00 per share (the
"Dividend Rate"). The dividend is payable semi-annually within seven (7)
business days after each of December 31 and June 30 of each year, commencing
December 31, 1999 (each, a "Dividend Declaration Date"). Dividends shall be paid
only with respect to shares of Series 14 Class N Preferred Stock actually issued
and outstanding on a Dividend Declaration Date and to holders of record as of
the Dividend Declaration Date. Dividends shall accrue from the first day of the
semi-annual period in which such dividend may be payable, except with respect to
the first semi-annual dividend which shall accrue from August 3, 1999. In the
event that the Corporation elects to pay dividends in Common Stock of the
Corporation, each holder of the Series 14 Class N Preferred Stock shall receive
shares of Common Stock of the Corporation equal to the quotient of (i) the
Dividend Rate in effect on the applicable Dividend Declaration Date dividend by
(ii) the average of the closing bid quotation of the Common Stock as reported on
the over-the-counter market, or the closing sale price if listed on a national
securities exchange, for the five (5) trading days immediately prior to the
Dividend Declaration Date (the "Stock Dividend Price"). Dividends on the Series
14 Class N Preferred Stock shall be cumulative, and no dividends or other
distributions shall be paid or declared or set aside for payment on the Common
Stock until all accrued and unpaid dividends on all outstanding shares of Series
14 Class N Preferred Stock shall have been paid or declared and set aside for
payment.

Part 4 - Conversion. The holders of the Series 14
Class N Preferred Stock shall have rights to convert the shares of Series 14
Class N Preferred Stock into shares of the Corporation's Common Stock, par value
$.001 per share ("Common Stock"), as follows (the "Conversion Rights"):

4.1    No Right to Convert. The Series 14 Class N Preferred shall not be
convertible into shares of Common Stock until after April 20, 2000.



-4-


4.2    Right to Convert. The Series 14 Class N Preferred
Stock may be convertible into shares of Common Stock at any time on or after
April 20, 2000.

4.3    Conversion Price. As used herein, the term
Conversion Price shall be the product of (i) the average closing bid quotation
of the Common Stock as reported on the over-the-counter market, or the closing
sale price if listed on a national securities exchange, for the five (5) trading
days immediately preceding the date of the Conversion Notice referred to in
Section 4.4 below multiplied by (ii) seventy-five percent (75%), subject to the
provisions of this Section 4.3. Notwithstanding the foregoing, the Conversion
Price shall not be (i) less than a minimum of $1.50 per share for a period of
twenty-four (24) months from April 20, 1999, or, after twenty-four (24) months
from April 20, 1999, a minimum of $.50 per share (as applicable, the "Minimum
Conversion Price") or (ii) more than a maximum of $1.50 per share ( "Maximum
Conversion Price"). If, after July 1, 1996, the Corporation sustains a net loss,
on a consolidated basis, in each of two (2) consecutive quarters, as determined
under generally accepted accounting principles, the Minimum Conversion Price
shall be reduced $.25 a share, but there shall be no change to, or reduction of,
the Maximum Conversion Price. For the purpose of determining whether the
Corporation has had a net loss in each of two (2) consecutive quarters, at no
time shall a quarter that has already been considered in such determination be
considered in any subsequent determination (as an example the third quarter of
1996 in which there is a net profit and the fourth quarter of 1996 in which
there is a net loss shall be considered as two consecutive quarters, and, as a
result, the fourth quarter of 1996 shall not be considered along with the first
quarter of 1997 as two (2) consecutive quarters, but the first quarter of 1997
must be considered with the second quarter of 1997 for the purposes of such
determination). For the purposes of this Section 4.3, a "quarter" is a three (3)
month period ending on March 31, June 30, September 30, and December 31. If any
of the outstanding shares of Series 14 Class N Preferred Stock are converted, in
whole or in part, into Common Stock pursuant to the terms of this Part 4, the
number of shares of whole Common Stock to be issued to the holder as a result of
such conversion shall be determined by dividing (a) the aggregate Liquidation
Value of the Series 14 Class N Preferred Stock so surrendered for conversion by
(b) the Conversion Price in effect at the date of the conversion. At the time of
conversion of shares of the Series 14 Class N Preferred Stock, the Corporation
shall pay in cash to the holder thereof an amount equal to all unpaid and
accrued dividends, if any, accrued thereon to the date of conversion, or, at the
Corporation's option, in lieu of paying cash for the accrued and unpaid
dividends, issue that number of shares of whole Common Stock which is equal to
the product of dividing the amount of such unpaid and accrued dividends to the
date of conversion on the shares of Series 14 Class N Preferred Stock so
converted by the Conversion Price in effect at the date of conversion.

4.4    Mechanics of Conversion. Any holder of the Series
14 Class N Preferred Stock who wishes to exercise its Conversion Rights pursuant
to the terms of this Part 4 must, if such shares are not being held in escrow by
the Corporation's attorneys, surrender the certificate therefor at the principal
executive office of the Corporation, and give written notice, which may be via
facsimile transmission, to the Corporation at such office that it elects to
convert the same (the "Conversion Notice"). In the event that the shares of
Series 14 Class



-5-


N Preferred Stock are being held in escrow by the Corporation's attorneys, no
delivery of the certificates shall be required. No Conversion Notice with
respect to any shares of Series 14 Class N Preferred Stock can be given prior to
the time such shares of Series 14 Class N Preferred Stock are eligible for
conversion in accordance with the provision of Section 4.1 above. Any such
premature Conversion Notice shall automatically be null and void. The
Corporation shall, within five (5) business days after receipt of an appropriate
and timely Conversion Notice (and certificate, if necessary), issue to such
holder of Series 14 Class N Preferred Stock or its agent a certificate for the
number of shares of Common Stock to which he shall be entitled; it being
expressly agreed that until and unless the holder delivers written notice to the
Corporation to the contrary, all shares of Common Stock issuable upon conversion
of the Series 14 Class N Preferred Stock hereunder are to be delivered by the
Corporation to a party designated in writing by the holder in the Conversion
Notice for the account of the holder and such shall be deemed valid delivery to
the holder of such shares of Common Stock. Such conversion shall be deemed to
have been made only after both the certificate for the shares of Series 14 Class
N Preferred Stock to be converted have been surrendered and the Conversion
Notice is received by the Corporation (or in the event that no surrender of the
Certificate is required, then only upon the receipt by the Corporation of the
Conversion Notice) (the "Conversion Documents"), and the person or entity whose
name is noted on the certificate evidencing such shares of Common Stock issuable
upon such conversion shall be treated for all purposes as the record holder of
such shares of Common Stock at and after such time. In the event that the
Conversion Notice is sent via facsimile transmission, the Corporation shall be
deemed to have received such Conversion Notice on the first business day on
which such facsimile Conversion Notice is actually received. If the Corporation
fails to deliver to the holder or its agent the certificate representing the
shares of Common Stock that the holder is entitled to receive as a result of
such conversion within five (5) business days after receipt by the Corporation
from the holder of an appropriate and timely Conversion Notice and certificates
pursuant to the terms of this Section 4.4, the Corporation shall pay to the
holder U.S. $1,000 for each day that the Corporation is late in delivering such
certificate to the holder or its agent.

4.5   Adjustments to Conversion Price for Stock Dividends and for
Combinations or Subdivisions of Common Stock. If the Corporation at
any time or from time to time while shares of Series 14 Class N Preferred Stock
are issued and outstanding shall declare or pay, without consideration, any
dividend on the Common Stock payable in Common Stock, or shall effect a
subdivision of the outstanding shares of Common Stock into a greater number of
shares of Common Stock (by stock split, reclassification or otherwise than by
payment of a dividend in Common Stock or in any right to acquire Common Stock),
or if the outstanding shares of Common Stock shall be combined or consolidated,
by reclassification or otherwise, into a lesser number of shares of Common
Stock, then the Conversion Price in effect immediately before such event shall,
concurrently with the effectiveness of such event, be proportionately decreased
or increased, as appropriate. If the Corporation shall declare or pay, without
consideration, any dividend on the Common Stock payable in any right to acquire
Common stock for no consideration, then the Corporation shall be deemed to have
made a dividend payable in Common Stock in an amount of shares equal to the
maximum number of shares issuable upon exercise of such rights to acquire Common
Stock.



-6-


4.6.   Adjustments for Reclassification and
Reorganization. If the Common Stock issuable upon conversion of the
Series 14 Class N Preferred Stock shall be changed into the same or a different
number of shares of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise (other than a subdivision or
combination of shares provided for in Section 4.5 hereof), the Conversion Price
then in effect shall, concurrently with the effectiveness of such reorganization
or reclassification, be proportionately adjusted so that the Series 14 Class N
Preferred Stock shall be convertible into, in lieu of the number of shares of
Common Stock which the holders of Series 14 Class N Preferred Stock would
otherwise have been entitled to receive, a number of shares of such other class
or classes of stock equivalent to the number of shares of Common Stock that
would have been subject to receipt by the holders upon conversion of the Series
14 Class N Preferred Stock immediately before that change.

4.7   Common Stock Duly Issued. All Common Stock which
may be issued upon conversion of Series 14 Class N Preferred Stock will, upon
issuance, be duly issued, fully paid and nonassessable and free from all taxes,
liens, and charges with respect to the issue thereof.

4.8    Notice of Adjustments. Upon the occurrence of
each adjustment or readjustment of any Conversion Price pursuant to this Part 4,
the Corporation, at its expense, within a reasonable period of time, shall
compute such adjustment or readjustment in accordance with the terms hereof and
prepare and furnish to each holder of Series 14 Class N Preferred Stock a notice
setting forth such adjustment or readjustment and showing in detail the facts
upon which such adjustment is based.

4.9    Issue Taxes. The Corporation shall pay any and
all issue and other taxes that may be payable in respect of any issue or
delivery of shares of Common Stock on conversion of the Series 14 Class N
Preferred Stock pursuant thereto; provided, however, that the Corporation
shall not be obligated to pay any transfer taxes resulting from any transfer
requested by any holder of Series 14 Class N Preferred Stock in connection with
such conversion.

4.10    Reservation of Stock Issuable Upon Conversion.
The Corporation shall at all times reserve and keep available out of its
authorized but unissued shares of Common Stock, solely for the purpose of
effecting the conversion of the shares of the Series 14 Class N Preferred Stock,
such number of its shares of Common Stock as shall, from time to time, be
sufficient to effect the conversion of all outstanding shares of the Series 14
Class N Preferred stock, and, if at any time, the number of authorized but
unissued shares of Common Stock shall not be sufficient to effect the conversion
of all then outstanding shares of the Series 14 Class N Preferred Stock, the
Corporation will take such corporate action as may be necessary to increase its
authorized but unissued shares of Common Stock to such number of shares as shall
be sufficient for such purposes, including, without limitation, engaging in
reasonable efforts to obtain the requisite stockholder approval of any necessary
amendment to its Certificate of Incorporation.

4.11    Fractional Shares. No fractional share shall be
issued upon the conversion of any share or shares of Series 14 Class N Preferred
Stock. 



-7-


ll shares of Common Stock (including fractions thereof) issuable upon
conversion of more than one share of Series 14 Class N Preferred Stock by a
holder thereof shall be aggregated for purposes of determining whether the
conversion would result in the issuance of any fractional share. If, after the
aforementioned aggregation, the conversion would result in the issuance of a
fractional share of Common Stock, such fractional share shall be rounded up to
the nearest whole share.

4.12    Notices. Any notices required by the provisions
of this Part 4 to be given to the holders of shares of Series 14 Class N
Preferred Stock shall be deemed given if deposited in the United States mail,
postage prepaid, and addressed to each holder of record at his address appearing
on the books of the Corporation.

4.13    Business Day. As used herein, the term "business
day" shall mean any day other than a Saturday, Sunday or a day when the federal
and state banks located in the State of New York are required or permitted to
close.

Part 5 - Redemption.

5.1    Redemption at Corporation's Option. Except as
otherwise provided in this Section 5.1, at any time, and from time to time, the
Corporation may, at its sole option, but shall not be obligated to, redeem, in
whole or in part, at any time, and from time to time, the then outstanding
Series 14 Class N Preferred Stock at the following cash redemption prices if
redeemed during the following periods: (i) within twelve (12)
months from April 20, 1999 - $1,100 per share, and (ii) after
twelve (12) months from April 20, 1999 - $1,200 per share (as
applicable, the redemption price of $1,100 or $1,200 is referred to herein as
the "Redemption Price").

5.2   Mechanics of Redemption. Prior to any date
stipulated by the Corporation for the redemption of Series 14 Class N Preferred
Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be
mailed to each holder of record on such notice date of the Series 14 Class N
Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of
such shares, (ii) the number of Series 14 Class N Preferred Stock to be redeemed
from the holder to whom the Redemption Notice is addressed, (iii) instructions
for surrender to the Corporation, in the manner and at the place designated, of
a share certificate or share certificates representing the number of Series 14
Class N Preferred Stock to be redeemed from such holder, and (iv) instructions
as to how to specify to the Corporation the number of Series 14 Class N
Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption
Notice is mailed to the Holder after the first twelve (12) months from April 20,
1999, the number of shares to be converted into Common Stock as provided in Part
4 hereof.

5.3   Mechanics of Redemption. Prior to any date
stipulated by the Corporation for the redemption of Series 14 Class N Preferred
Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be
mailed to each holder of record on such notice date of the Series 14 Class N
Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of
such shares, (ii) the number of Series 14 Class N



-8-


Preferred Stock to be redeemed from the holder to whom the Redemption Notice
is addressed, (iii) instructions for surrender to the Corporation, in the manner
and at the place designated, of a share certificate or share certificates
representing the number of Series 14 Class N Preferred Stock to be redeemed from
such holder, and (iv) instructions as to how to specify to the Corporation the
number of Series 14 Class N Preferred Stock to be redeemed as provided in this
Part 5 and, if the Redemption Notice is mailed to the Holder after the first 12
months from April 20, 1999, the number of shares to be converted into Common
Stock as provided in Part 4 hereof.

5.4   Rights of Conversion Upon Redemption. If the
redemption occurs during the first 12 months after April 20, 1999, the holder
may not convert any redeemed shares. If the redemption occurs pursuant to
Section 5.1 (i) hereof, the Holder of the Series 14 Class N Preferred Stock
shall not have the right to convert those outstanding shares of Series 14 Class
N Preferred Stock that the Company is redeeming after receipt of the Redemption
Notice. If the redemption occurs pursuant to Section 5.1 (ii) hereof, then, upon
receipt of the Redemption Notice, any holder of Series 14 Class N Preferred
Stock shall have the next five business days during which it may exercise the
option, at its sole election, to specify what portion of its Series 14 Class N
Preferred Stock called for redemption in the Redemption Notice shall be redeemed
as provided in this Part 5 or converted into Common Stock in the manner provided
in Part 4 hereof, except that, notwithstanding any provision of such Part 4 to
the contrary, after twelve (12) months from April, 20, 1999, such holder shall
have the right to convert into Common Stock that number of Series 14 Class N
Preferred Stock called for redemption in the Redemption Notice.

5.5   Surrender of Certificates. On or before the
Redemption Date in respect of any Series 14 Class N Preferred Stock, each holder
of such shares shall surrender the required certificate or certificates
representing such shares to the Corporation in the manner and at the place
designated in the Redemption Notice, and upon the Redemption Date, the
Redemption Price for such shares shall be made payable, in the manner provided
in Section 5.6 hereof, to the order of the person whose name appears on such
certificate or certificates as the owner thereof, and each surrendered share
certificate shall be canceled and retired. If a share certificate is surrendered
and all the shares evidenced thereby are not being redeemed (as described
below), the Corporation shall cause the Series 14 Class N Preferred Stock which
are not being redeemed to be registered in the names of the persons or entity
whose names appear as the owners on the respective surrendered share
certificates and deliver such certificate to such person.

5.6    Payment. On the Redemption Date in respect of any
Series 14 Class N Preferred Stock or prior thereto, the Corporation shall
deposit with any bank or trust company having a capital and surplus of at least
U. S. $50,000,000, as a trust fund, a sum equal to the aggregate First Year
Redemption Price or the Redemption Price, whichever is applicable, of all such
shares called from redemption (less the aggregate Redemption Price for those
Series 14 Class N Preferred Stock in respect of which the Corporation has
received notice from the holder thereof of its election to convert Series 14
Class N Preferred Stock into Common Stock), with irrevocable instructions and
authority to the bank or trust company to pay, on or after the Redemption Date,
the Redemption Price to the respective holders upon the surrender of their share
certificates. The deposit shall constitute full payment for the shares



-9-


to their holders, and from and after the date of the deposit the redeemed
shares shall be deemed to be no longer outstanding, and holders thereof shall
cease to be shareholders with respect to such shares and shall have no rights
with respect thereto except the rights to receive from the bank or trust company
payments of the First Year Redemption Price or the Redemption Price, whichever
is applicable, of the shares, without interest, upon surrender of their
certificates thereof. Any funds so deposited and unclaimed at the end of one
year following the Redemption Date shall be released or repaid to the
Corporation, after which the former holders of shares called for redemption
shall be entitled to receive payment of the First Year Redemption Price or the
Redemption Price, whichever is applicable, in respect of their shares only from
the Corporation.

Part 6 - Parity with Other Shares of Series 14 Class N Preferred
Stock and Priority.

6.1    Rateable Participation. If any cumulative
dividends or return of capital in respect of Series 14 Class N Preferred Stock
are not paid in full, the owners of all series of outstanding Preferred Stock
shall participate rateably in respect of accumulated dividends and return of
capital.

6.2    Ranking. For purposes of this resolution, any
stock of any class or series of the Corporation shall be deemed to rank:

          6.2.1    Prior or senior to the shares of this Series 14 Class N Preferred Stock
either as to 

                      dividends or upon liquidation, if the holders of such class or
classes shall be entitled 

                      to the receipt of dividends or of amounts
distributable upon dissolution, liquidation 

                      or winding up of the Corporation,
whether voluntary or involuntary, as the case 

                      may be, in preference or priority
to the holders of shares of this Series 14 Class N 

                      Preferred Stock;

          6.2.2   On a parity with, or equal to, shares of this Series 14 Class N
Preferred Stock, either 

                      as to dividends or upon liquidation, whether or not the
dividend rates, dividend 

                      payment dates, or redemption or liquidation prices per
share or sinking fund 

                      provisions, if any, are different from those of this
Series 14 Class N Preferred Stock, 

                      if the
holders of such stock are entitled to
the receipt of dividends or of amounts 

                      distributable upon dissolution,
liquidation or winding up of the Corporation, whether 

                      voluntary or involuntary,
in proportion to their respective dividend rates or liquidation 

                       prices, without
preference or priority, one over the other, as between the holders 

                      of such stock
and over the other, as between the holders of such stock and the 

                       holders of
shares of this Series 14 Class N Preferred Stock; and,

          6.2.3  Junior to shares of this Series 14 Class N Preferred Stock, either as
to dividends or 

                    upon liquidation, if such class or series shall be Common Stock
or if the holders of 

                    shares of this Series 14 Class N Preferred Stock shall be
entitled to receipt of dividends 

                    or of amounts distributable upon dissolution,
liquidation or winding up of the 

                    Corporation, whether voluntary or



-10-


involuntary, as the case may be, in preference or priority to the holders of
shares of such class or series.

Part 7 - Amendment and Reissue.

7.1    Amendment. If any proposed amendment to the
Corporation's Certificate of Incorporation would alter or change the powers,
preferences or special rights of the Series 14 Class N Preferred Stock so as to
affect such adversely, then the Corporation must obtain the affirmative vote of
such amendment to the Certificate of Incorporation at a duly called and held
series meeting of the holders of the Series 14 Class N Preferred Stock or
written consent by the holders of a majority of the Series 14 Class N Preferred
Stock then outstanding. Notwithstanding the above, the number of authorized
shares of any class or classes of stock may be increased or decreased (but not
below the number of shares thereof outstanding) by the affirmative vote of the
holders of a majority of the stock of the Corporation entitled to vote thereon,
voting together as a single class, irrespective of this Section 7.1 or the
requirements of Section 242 of the GCL.

7.2   Authorized. Any shares of Series 14 Class N
Preferred Stock acquired by the Corporation by reason of purchase, conversion,
redemption or otherwise shall be retired and shall become authorized but
unissued shares of Preferred Stock, which may be reissued as part of a new
series of Preferred Stock hereafter created.
 
 

 

 

 



-11-
 



CERTIFICATE OF DESIGNATIONS

OF SERIES 15 CLASS O CONVERTIBLE PREFERRED STOCK

OF

PERMA-FIX ENVIRONMENTAL SERVICES, INC.


          Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation
organized and existing under the General Corporation Law of the State of
Delaware, does hereby certify:

          That, pursuant to authority conferred upon by the Board of Directors by the
Corporation's Restated Certificate of Incorporation, as amended, and pursuant to
the provisions of Section 151 of the Delaware Corporation Law, the Board of
Directors of the Corporation has adopted resolutions, a copy of which is
attached hereto, establishing and providing for the issuance of a series of
Preferred Stock designated as Series 15 Class O Convertible Preferred Stock and
has established and fixed the voting powers, designations, preferences and
relative participating, optional and other special rights and qualifications,
limitations and restrictions of such Series 15 Class O Convertible Preferred
Stock as set forth in the attached resolutions.

Dated: August 10, 1999

                                                                     PERMA-FIX ENVIRONMENTAL SERVICES, INC.


                                                                      By /s/ Louis Centofanti                                          

                                                                           Dr. Louis F. Centofanti

                                                                           Chairman of the Board
ATTEST:


/s/ Richard T. Kelecy                             

Richard T. Kelecy, Secretary
 

STATE OF DELAAWARE    

SECRETARY OF STATE    

DIVISION OF CORPORATIONS

FILED 12:31 PM -- 08/10/1999

991331579 -- 22498949    

 



PERMA-FIX ENVIRONMENTAL SERVICES, INC.

(the "Corporation")



RESOLUTION OF THE BOARD OF DIRECTORS

FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,

RESTRICTIONS AND CONDITIONS ATTACHING TO THE

SERIES 15 CLASS O CONVERTIBLE PREFERRED STOCK


           WHEREAS, the Corporation's capital includes preferred stock,
par value $.001 per share ("Preferred Stock"), which Preferred Stock may be
issued in one or more series by resolutions adopted by the directors, and with
the directors being entitled by resolution to fix the number of shares in each
series and to designate the rights, designations, preferences and relative,
participating, optional or other special rights and privileges, restrictions and
conditions attaching to the shares of each such series;

          WHEREAS, it is in the best interests of the Corporation for
the Board to create a new series from the Preferred Stock designated as the
Series 15 Class O Convertible Preferred Stock, par value $.001 per share (the
"Series 15 Class O Preferred Stock");

          NOW, THEREFORE, BE IT RESOLVED, that the Series 15 Class O
Preferred Stock shall consist of six hundred sixteen (616) shares and no more
and shall be designated as the Series 15 Class O Convertible Preferred Stock,
and the preferences, rights, privileges, restrictions and conditions attaching
to the Series 15 Class O Preferred Stock shall be as follows:

Part 1 - Voting and Preemptive Rights.

1.1    Voting Rights. Except as otherwise provided in
Part 7 hereof or under Section 242(b)(2) of the General Corporation Law of the
State of Delaware (the "GCL"), the holders of the Series 15 Class O Preferred
Stock shall have no voting rights whatsoever. To the extent that under Section
242(b)(2) of the GCL or Part 7 hereof, the holders of the Series 15 Class O
Preferred Stock are entitled to vote on a matter, each share of the Series 15
Class O Preferred Stock shall be entitled one (1) vote for each outstanding
share of Series 15 Class O Preferred Stock. Holders of the Series 15 Class O
Preferred Stock shall be entitled to notice of (and copies of proxy materials
and other information sent to stockholders) for all shareholder meetings or
written consents with respect to which they would be entitled to vote, which
notice would be provided pursuant to the Corporation's bylaws and applicable
statutes.

1.2    No Preemptive Rights. The Series 15 Class O
Preferred Stock shall not give its holders any preemptive rights to acquire any
other securities issued by the Corporation at any time in the future.



-1-


Part 2 - Liquidation Rights.

2.1    Liquidation. If the Corporation shall be
voluntarily or involuntarily liquidated, dissolved or wound up at any time when
any shares of the Series 15 Class O Preferred Stock shall be outstanding, the
holders of the then outstanding Series 15 Class O Preferred Stock shall have a
preference in distribution of the Corporation's property available for
distribution to the holders of the Corporation's Common Stock equal to $1,000
consideration per outstanding share of Series 15 Class O Preferred Stock, plus
an amount equal to all unpaid dividends accrued thereon to the date of payment
of such distribution ("Liquidation Preference"), whether or not declared by the
Board.

2.2    Payment of Liquidation Preferences. Subject to
the provisions of Part 6 hereof, all amounts to be paid as Liquidation
Preference to the holders of Series 15 Class O Preferred Stock, as provided in
this Part 2, shall be paid or set apart for payment before the payment or
setting apart for payment of any amount for, or the distribution of any of the
Corporation's property to the holders of the Corporation's Common Stock, whether
now or hereafter authorized, in connection with such liquidation, dissolution or
winding up.

2.3    No Rights After Payment. After the payment to the
holders of the shares of the Series 15 Class O Preferred Stock of the full
Liquidation Preference amounts provided for in this Part 2, the holders of the
Series 15 Class O Preferred Stock as such shall have no right or claim to any of
the remaining assets of the Corporation.

2.4   Assets Insufficient to Pay Full Liquidation
Preference. In the event that the assets of the Corporation
available for distribution to the holders of shares of the Series 15 Class O
Preferred Stock upon any dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, shall be insufficient to pay in
full all amounts to which such holders are entitled pursuant to this Part 2, no
such distribution shall be made on account of any shares of any other class or
series of Preferred Stock ranking on a parity with the shares of this Series 15
Class O Preferred Stock upon such dissolution, liquidation or winding up unless
proportionate distributive amounts shall be paid on account of the shares of
this Series 15 Class O Preferred Stock and shares of such other class or series
ranking on a parity with the shares of this Series 15 Class O Preferred Stock,
ratably, in proportion to the full distributable amounts for which holders of
all such parity shares are respectively entitled upon such dissolution,
liquidation or winding up.

Part 3 - Dividends. The holders of the Series 15
Class O Preferred Stock are entitled to receive if, when and as declared by the
Board out of funds legally available therefor, cumulative dividends, payable in
cash or Common Stock of the Corporation, par value $.001 per share (the "Common
Stock"), or any combination thereof, at the Corporation's election, at the rate
of four percent (4%) per



-2-


annum of the Liquidation Value (as defined below) of each issued and
outstanding share of Series 15 Class O Preferred Stock (the "Dividend Rate").
The Liquidation Value of the Series 15 Class O Preferred Stock shall be $1,000
per outstanding share of the Series 15 Class O Preferred Stock (the "Liquidation
Value"). The dividend is payable semi-annually within seven (7) business days
after each of December 31 and June 30 of each year, commencing December 31, 1999
(each, a "Dividend Declaration Date"). Dividends shall be paid only with respect
to shares of Series 15 Class O Preferred Stock actually issued and outstanding
on a Dividend Declaration Date and to holders of record of the Series 15 Class O
Preferred Stock as of the Dividend Declaration Date. Dividends shall accrue from
the first day of the semi-annual period in which such dividend may be payable,
except with respect to the first semi-annual dividend which shall accrue from
August 3, 1999. In the event that the Corporation elects to pay the accrued
dividends due as of a Dividend Declaration Date on an outstanding share of the
Series 15 Class O Preferred Stock in Common Stock of the Corporation, the holder
of such share shall receive that number of shares of Common Stock of the
Corporation equal to the product of (a) the quotient of (i) the Dividend Rate
divided by (ii) the average of the closing bid quotation of the Corporation's
Common Stock as reported on the National Association of Securities Dealers
Automated Quotation system ("NASDAQ"), or the average closing sale price if
listed on a national securities exchange, for the five (5) trading days
immediately prior to the Dividend Declaration Date (the "Stock Dividend Price"),
times (b) a fraction, the numerator of which is the number of days elapsed
during the period for which the dividend is to be paid and the denominator of
which is 365. Dividends on the Series 15 Class O Preferred Stock shall be
cumulative, and no dividends or other distributions shall be paid or declared or
set aside for payment on the Corporation's Common Stock until all accrued and
unpaid dividends on all outstanding shares of Series 15 Class O Preferred Stock
shall have been paid or declared and set aside for payment.

Part 4 - Conversion. The holders of the Series 15
Class O Preferred Stock shall have rights to convert the shares of Series 15
Class O Preferred Stock into shares of the Corporation's Common Stock, par value
$.001 per share ("Common Stock"), as follows (the "Conversion Rights"):

4.1    No Right to Convert. The Series 15 Class O
Preferred shall not be convertible into shares of Common Stock until after April
20, 2000.

4.2    Right to Convert. The Series 15
Class O Preferred Stock may be convertible into shares of Common Stock at any
time after April 20, 2000.

4.3    Conversion Price. Subject to the terms hereof, as
used herein, the Conversion Price per outstanding share of Series 15 Class O
Preferred Stock shall be $1.8125, except that, in the event the average closing
bid price per share of the Common Stock as reported on the over-the-counter
market, or



-3-


the closing sale price if listed on a national securities exchange, for the
five (5) trading days prior to the particular date of conversion shall be less
than $2.265, the Conversion Price for only such particular conversion shall be
the product of the average closing bid quotation of the Common Stock as reported
on the over-the-counter market, or the closing sale price if listed on a
national securities exchange, for the five (5) trading days immediately
preceding the date of the Conversion Notice referred to in Section 4.4 below in
connection with such conversion multiplied by eighty percent (80%), subject to
the provisions of this Section 4.2. Notwithstanding the foregoing, the
Conversion Price shall not be less than a minimum of $1.50 per share ("Minimum
Conversion Price") for a period of twenty-four (24) months from April 20, 1999.
If any of the outstanding shares of Series 15 Class O Preferred Stock are
converted, in whole or in part, into Common Stock pursuant to the terms of this
Part 4, the number of shares of whole Common Stock to be issued to the holder as
a result of such conversion shall be determined by dividing (a) the aggregate
Liquidation Value of the Series 15 Class O Preferred Stock so surrendered for
conversion by (b) the Conversion Price as of such conversion. At the time of
conversion of shares of the Series 15 Class O Preferred Stock, the Corporation
shall pay in cash to the holder thereof an amount equal to all unpaid and
accrued dividends, if any, accrued thereon to the date of conversion, or, at the
Corporation's option, in lieu of paying cash for the accrued and unpaid
dividends, issue that number of whole shares of Common Stock which is equal to
the quotient of the amount of such unpaid and accrued dividends to the date of
conversion on the shares of Series 15 Class O Preferred Stock so converted
divided by the Stock Dividend Price, as defined in Part 3 hereof, in effect at
the date of conversion.

4.4    Mechanics of Conversion. Any holder of the Series
15 Class O Preferred Stock who wishes to exercise its Conversion Rights pursuant
to the terms of this Part 4 must, if such shares are not being held in escrow by
the Corporation's attorneys, surrender the certificate therefor at the principal
executive office of the Corporation, and give written notice, which may be via
facsimile transmission, to the Corporation at such office that it elects to
convert the same (the "Conversion Notice"). In the event that the shares of
Series 15 Class O Preferred Stock are being held in escrow by the Corporation's
attorneys, no delivery of the certificates shall be required. The Corporation
shall, within five (5) business days after receipt of an appropriate and timely
Conversion Notice (and certificate, if necessary), issue to such holder of
Series 15 Class O Preferred Stock or its agent a certificate for the number of
shares of Common Stock to which he shall be entitled; it being expressly agreed
that until and unless the holder delivers written notice to the Corporation to
the contrary, all shares of Common Stock issuable upon conversion of the Series
15 Class O Preferred Stock hereunder are to be delivered by the Corporation to a
party designated in writing by the holder in the Conversion Notice for the
account of the holder and such shall be deemed valid delivery to the holder of
such shares of Common Stock. Such conversion shall be deemed to have been made
only after both the certificate for the shares of



-4-


Series 15 Class O Preferred Stock to be converted have been surrendered and
the Conversion Notice is received by the Corporation (or in the event that no
surrender of the Certificate is required, then only upon the receipt by the
Corporation of the Conversion Notice) (the "Conversion Documents"), and the
person or entity whose name is noted on the certificate evidencing such shares
of Common Stock issuable upon such conversion shall be treated for all purposes
as the record holder of such shares of Common Stock at and after such time. In
the event that the Conversion Notice is sent via facsimile transmission, the
Corporation shall be deemed to have received such Conversion Notice on the first
business day on which such facsimile Conversion Notice is actually received. If
the Corporation fails to deliver to the holder or its agent the certificate
representing the shares of Common Stock that the holder is entitled to receive
as a result of such conversion of the Series 15 Class O Preferred Stock within
seven (7) business days after receipt by the Corporation from the holder of an
appropriate and timely Conversion Notice and certificates pursuant to the terms
of this Section 4.4 ("Seven (7) Business Day Period"), then, upon the written
demand of RBB Bank Aktiengesellschaft ("RBB Bank"), the holder of the Series 15
Class O Preferred Stock, for payment of the penalty described below in this
Section 4.4, which demand must be received by the Corporation no later than ten
(10) calendar days after the expiration of such Seven (7) Business Day Period,
the Corporation shall pay to RBB Bank the following penalty for each business
day after the Seven (7) Business Day Period until the Corporation delivers to
the holder or its agent the certificate representing the shares of Common Stock
that the holder is entitled to receive as a result of such conversion: business
day eight (8) - U.S. $1,000; business day nine (9) - U.S. $2,000, and each
business day thereafter an amount equal to the penalty due on the immediately
preceding business day times two (2) until the Corporation delivers to the
holder or its agent the certificate representing the shares of Common Stock that
the holder is entitled to receive as a result of such conversion. 

4.5    Merger or Consolidation. In case of either (a)
any merger or consolidation to which the Corporation is a party (collectively,
the "Merger"), other than a Merger in which the Corporation is the surviving or
continuing corporation, or (b) any sale or conveyance to another corporation of
all, or substantially all, of the assets of the Corporation (collectively, the
"Sale"), and such Merger or Sale becomes effective (x) while any shares of
Series 15 Class O Preferred Stock are outstanding and prior to the date that the
Corporation's Registration Statement covering up to 1,379,311 shares of Common
Stock issuable upon the conversion of the Series 15 Class O Preferred Stock is
declared effective by the U. S. Securities and Exchange Commission or (y) prior
to the end of the restriction periods in Section 4.3, then, in such event, the
Corporation or such successor corporation, as the case may be, shall make
appropriate provision so that the holder of each share of Series 15 Class O
Preferred Stock then outstanding shall have the right to convert such share of
Series 15 Class O Preferred Stock into the kind and amount of shares of stock or
other securities and property receivable upon such Merger or Sale by a holder of
the number



-5-


of shares of Common Stock into which such shares of Series 15 Class O
Preferred Stock could have been converted into immediately prior to such Merger
or Sale, subject to adjustments which shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Part 4.

4.6    Adjustments to Conversion Price for Stock Dividends and for
Combinations or Subdivisions of Common Stock. If the Corporation at
any time or from time to time while shares of Series 15 Class O Preferred Stock
are issued and outstanding shall declare or pay, without consideration, any
dividend on the Common Stock payable in Common Stock, or shall effect a
subdivision of the outstanding shares of Common Stock into a greater number of
shares of Common Stock (by stock split, reclassification or otherwise than by
payment of a dividend in Common Stock or in any right to acquire Common Stock),
or if the outstanding shares of Common Stock shall be combined or consolidated,
by reclassification or otherwise, into a lesser number of shares of Common
Stock, then the Conversion Price in effect immediately before such event shall,
concurrently with the effectiveness of such event, be proportionately decreased
or increased, as appropriate.

4.7   Adjustments for Reclassification and
Reorganization. If the Common Stock issuable upon conversion of the
Series 15 Class O Preferred Stock shall be changed into the same or a different
number of shares of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise (other than a subdivision or
combination of shares provided for in Section 4.6 hereof), the Conversion Price
shall, concurrently with the effectiveness of such reorganization or
reclassification, be proportionately adjusted so that the Series 15 Class O
Preferred Stock shall be convertible into, in lieu of the number of shares of
Common Stock which the holders of Series 15 Class O Preferred Stock would
otherwise have been entitled to receive, a number of shares of such other class
or classes of stock equivalent to the number of shares of Common Stock that
would have been subject to receipt by the holders upon conversion of the Series
15 Class O Preferred Stock immediately before that change.

4.8    Common Stock Duly Issued. All Common Stock which
may be issued upon conversion of Series 15 Class O Preferred Stock will, upon
issuance, be duly issued, fully paid and nonassessable and free from all taxes,
liens, and charges with respect to the issue thereof.

4.9    Notice of Adjustments. Upon the occurrence of
each adjustment or readjustment of any Conversion Price pursuant to this Part 4,
the Corporation, at its expense, within a reasonable period of time, shall
compute such adjustment or readjustment in accordance with the terms hereof and
prepare and furnish to each holder of Series 15 Class O Preferred
 


-6-


Stock a notice setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment is based.

4.10    Issue Taxes. The Corporation shall pay any and
all issue and other taxes that may be payable in respect of any issue or
delivery of shares of Common Stock on conversion of the Series 15 Class O
Preferred Stock pursuant thereto; provided, however, that the Corporation
shall not be obligated to pay any transfer taxes resulting from any transfer
requested by any holder of Series 15 Class O Preferred Stock in connection with
such conversion.

4.11    Reservation of Stock Issuable Upon Conversion.
The Corporation shall at all times reserve and keep available out of its
authorized but unissued shares of Common Stock, solely for the purpose of
effecting the conversion of the shares of the Series 15 Class O Preferred Stock,
such number of its shares of Common Stock as shall, from time to time, be
sufficient to effect the conversion of all outstanding shares of the Series 15
Class O Preferred stock, and, if at any time, the number of authorized but
unissued shares of Common Stock shall not be sufficient to effect the conversion
of all then outstanding shares of the Series 15 Class O Preferred Stock, the
Corporation will take such corporate action as may be necessary to increase its
authorized but unissued shares of Common Stock to such number of shares as shall
be sufficient for such purposes, including, without limitation, engaging in
reasonable efforts to obtain the requisite stockholder approval of any necessary
amendment to its Certificate of Incorporation.

4.12   Fractional Shares. No fractional shares shall be
issued upon the conversion of any share or shares of Series 15 Class O Preferred
Stock. All shares of Common Stock (including fractions thereof) issuable upon
conversion of more than one share of Series 15 Class O Preferred Stock by a
holder thereof shall be aggregated for purposes of determining whether the
conversion would result in the issuance of any fractional share. If, after the
aforementioned aggregation, the conversion would result in the issuance of a
fractional share of Common Stock, such fractional share shall be rounded up to
the nearest whole share.

4.13    Notices. Any notices required by the provisions
of this Part 4 to be given to the holders of shares of Series 15 Class O
Preferred Stock shall be deemed given if deposited in the United States mail,
postage prepaid, and addressed to each holder of record at his address appearing
on the books of the Corporation.

4.14    Business Day. As used herein, the term "business
day" shall mean any day other than a Saturday, Sunday or a day when the federal
and state banks located in the State of New York are required or is permitted to
close.



-7-


Part 5 - Redemption.

5.1    Redemption at Corporation's Option. Except as
otherwise provided in this Section 5.1, at any time, and from time to time, the
Corporation may, at its sole option, but shall not be obligated to, redeem, in
whole or in part, at any time, and from time to time, the then outstanding
Series 15 Class O Preferred Stock at the following cash redemption prices if
redeemed during the following periods: (i) within twelve (12)
months from April 20, 1999 - $1,100 per share and (ii) after
twelve (12) months from April 20, 1999 - $1,200 per share (as
applicable, the redemption price of $1,100 or $1,200 is referred to herein as
the "Redemption Price").

5.2   Mechanics of Redemption. Prior to any date
stipulated by the Corporation for the redemption of Series 15 Class O Preferred
Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be
mailed to each holder of record on such notice date of the Series 15 Class O
Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of
such shares, (ii) the number of Series 15 Class O Preferred Stock to be redeemed
from the holder to whom the Redemption Notice is addressed, (iii) instructions
for surrender to the Corporation, in the manner and at the place designated, of
a share certificate or share certificates representing the number of Series 15
Class O Preferred Stock to be redeemed from such holder, and (iv) instructions
as to how to specify to the Corporation the number of Series 15 Class O
Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption
Notice is mailed to the Holder after the first twelve (12) months from April 20,
1999, the number of shares to be converted into Common Stock as provided in Part
4 hereof.

5.3    Rights of Conversion Upon Redemption. If the
redemption occurs during the first twelve (12) months after April 20, 1999, the
holder may not convert any redeemed shares. If the redemption occurs after the
first twelve (12) months after April 20, 1999, then, upon receipt of the
Redemption Notice, any holder of Series 15 Class O Preferred Stock shall have
five business days during which it may exercise the option, at its sole
election, to specify what portion of its Series 15 Class O Preferred Stock
called for redemption in the Redemption Notice shall be redeemed as provided in
this Part 5 or converted into Common Stock in the manner provided in Part 4
hereof, except that, notwithstanding any provision of such Part 4 to the
contrary, after twelve (12) months from April 20, 1999, such holder shall have
the right to convert into Common Stock that number of Series 15 Class O
Preferred Stock called for redemption in the Redemption Notice.

5.4    Surrender of Certificates. On or before the
Redemption Date in respect of any Series 15 Class O Preferred Stock, each holder
of such shares shall surrender the required certificate or certificates
representing such shares to the Corporation in the manner and at the place
designated in the



-8-


Redemption Notice, and upon the Redemption Date, the Redemption Price for
such shares shall be made payable, in the manner provided in Section 5.5 hereof,
to the order of the person whose name appears on such certificate or
certificates as the owner thereof, and each surrendered share certificate shall
be canceled and retired. If a share certificate is surrendered and all the
shares evidenced thereby are not being redeemed (as described below), the
Corporation shall cause the Series 15 Class O Preferred Stock which are not
being redeemed to be registered in the names of the persons or entity whose
names appear as the owners on the respective surrendered share certificates and
deliver such certificate to such person.

5.5    Payment. On the Redemption Date in respect of any
Series 15 Class O Preferred Stock or prior thereto, the Corporation shall
deposit with any bank or trust company having a capital and surplus of at least
$50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of
all such shares called from redemption (less the aggregate Redemption Price for
those Series 15 Class O Preferred Stock in respect of which the Corporation has
received notice from the holder thereof of its election to convert Series 15
Class O Preferred Stock into Common Stock), with irrevocable instructions and
authority to the bank or trust company to pay, on or after the Redemption Date,
the Redemption Price to the respective holders upon the surrender of their share
certificates. The deposit shall constitute full payment for the shares to their
holders, and from and after the date of the deposit the redeemed shares shall be
deemed to be no longer outstanding, and holders thereof shall cease to be
shareholders with respect to such shares and shall have no rights with respect
thereto except the rights to receive from the bank or trust company payments of
the Redemption Price of the shares, without interest, upon surrender of their
certificates thereof. Any funds so deposited and unclaimed at the end of one
year following the Redemption Date shall be released or repaid to the
Corporation, after which the former holders of shares called for redemption
shall be entitled to receive payment of the Redemption Price in respect of their
shares only from the Corporation.

Part 6 - Parity with Other Shares of Series 15 Class O Preferred
Stock and Priority.

6.1    Rateable Participation. If any cumulative
dividends or return of capital in respect of Series 15 Class O Preferred Stock
are not paid in full, the owners of all series of outstanding Preferred Stock
shall participate rateably in respect of accumulated dividends and return of
capital.

6.2    Ranking. For purposes of this resolution, any
stock of any class or series of the Corporation shall be deemed to rank:

        6.2.1    Prior or senior to the shares of this Series 15 Class O Preferred Stock
either as to 

                    dividends or upon liquidation, if the holders



-9-


                    of such class or classes shall be entitled to the receipt of dividends or of
amounts 

                    distributable upon dissolution, liquidation or winding up of the
Corporation, whether 

                    voluntary or involuntary, as the case may be, in preference
or priority to the holders 

                    of shares of this Series 15 Class O Preferred
Stock;

         6.2.2  On a parity with, or equal to, shares of this Series 15 Class O
Preferred Stock, either 

                   as to dividends or upon liquidation, whether or not the
dividend rates, dividend payment 

                   dates, or redemption or liquidation prices per
share or sinking fund provisions, if any, 

                   are different from those of this
Series 15 Class O Preferred Stock, if the holders of such 

                   stock are entitled to
the receipt of dividends or of amounts distributable upon dissolution,

                  
liquidation or winding up of the Corporation, whether voluntary or involuntary,
in 

                   proportion to their respective dividend rates or liquidation prices, without
preference or 

                   priority, one over the other, as between the holders of such stock
and over the other, as

                  
between the holders of such stock and the holders of
shares of this Series 15 Class O 

                   Preferred Stock; and,

         6.2.3  Junior to shares of this Series 15 Class O Preferred Stock, either as
to dividends or 

                   upon liquidation, if such class or series shall be Common Stock
or if the holders of 

                   shares of this Series 15 Class O Preferred Stock shall be
entitled to receipt of 

                   dividends or of amounts distributable upon dissolution,
liquidation or winding up of 

                   the Corporation, whether voluntary or involuntary,
as the case may be, in preference 

                   or priority to the holders of shares of such
class or series.

Part 7 - Amendment and Reissue.

7.1    Amendment. If any proposed amendment to the
Corporation's Certificate of Incorporation (the "Articles") would alter or
change the powers, preferences or special rights of the Series 15 Class O
Preferred Stock so as to affect such adversely, then the Corporation must obtain
the affirmative vote of such amendment to the Articles at a duly called and held
series meeting of the holders of the Series 15 Class O Preferred Stock or
written consent by the holders of a majority of the Series 15 Class O Preferred
Stock then outstanding. Notwithstanding the above or the provisions of Section
242(b)(2) of the GCL, the number of authorized shares of any class or classes of
stock of the Corporation may be increased or decreased (but not below the number
of shares thereof outstanding) by the affirmative vote of the holders of a
majority of the stock of the Corporation entitled to vote thereon, voting
together as a single class, irrespective of the provisions of this Section 7.1
or Section 242(b)(2) of the GCL.



-10-


7.2    Authorized. Any shares of Series 15 Class O
Preferred Stock acquired by the Corporation by reason of purchase, conversion,
redemption or otherwise shall be retired and shall become authorized but
unissued shares of Preferred Stock, which may be reissued as part of a new
series of Preferred Stock hereafter created.

 

 

 

 

 

 

 

 

 

 

 



-11-



CERTIFICATE OF DESIGNATIONS

OF SERIES 16 CLASS P CONVERTIBLE PREFERRED STOCK

OF

PERMA-FIX ENVIRONMENTAL SERVICES, INC.


          Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation
organized and existing under the General Corporation Law of the State of
Delaware, does hereby certify:

          That, pursuant to authority conferred upon by the Board of Directors by the
Corporation's Restated Certificate of Incorporation, as amended, and pursuant to
the provisions of Section 151 of the Delaware Corporation Law, the Board of
Directors of the Corporation has adopted resolutions, a copy of which is
attached hereto, establishing and providing for the issuance of a series of
Preferred Stock designated as Series 16 Class P Convertible Preferred Stock and
has established and fixed the voting powers, designations, preferences and
relative participating, optional and other special rights and qualifications,
limitations and restrictions of such Series 16 Class P Convertible Preferred
Stock as set forth in the attached resolutions.

Dated: August 10, 1999

                                                                  PERMA-FIX ENVIRONMENTAL SERVICES, INC.


                                                                  By
 /s/ Louis Centofanti                                            

                                                                        Dr.
Louis F. Centofanti

                                                                        Chairman of the Board

ATTEST:



/s/ Richard T. Kelecy                         

Richard T. Kelecy, Secretary

 

STATE OF
DELAWARE     

SECRETARY OF STATE     

DIVISION OF CORPORATIONS

FILED 12:32 PM -- 08/10/1999

991331580 -- 2249849      

 



PERMA-FIX ENVIRONMENTAL SERVICES, INC.

(the "Corporation")



RESOLUTION OF THE BOARD OF DIRECTORS



FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,

RESTRICTIONS AND CONDITIONS ATTACHING TO THE

SERIES 16 CLASS P CONVERTIBLE PREFERRED STOCK
RE: DESIGNATION OF SERIES 16 CLASS P PREFERRED STOCK.



RESOLVED: That the designations, powers, preferences and
rights of the Series 16 Class P Convertible Preferred Stock be, and they hereby
are, as set forth below:

1.    Number of Shares of Common Stock of Series 16
Class P Convertible Preferred Stock 

The Corporation hereby authorizes the issuance of up to one thousand eight
hundred two (1,802) shares of Series 16 Class P Convertible Preferred Stock par
value $.001 per share (the "Preferred Stock"). This Preferred Stock shall pay an
annual dividend based on a 365 day calendar year of 4% of the Liquidation Value
(as defined in Section 3 hereof) ("Dividend Rate"), payable semiannually within
ten (10) business days after each subsequent June 30th and December 31st (each a
"Dividend Declaration Date"), and shall be payable in cash or shares of the
Corporation's par value $.001 per share common stock (Common Stock) at the
Corporation's option. The first Dividend Declaration Date shall be December
31st, 1999.

In the event that the Corporation elects to pay the accrued dividends due as
of a Dividend Declaration Date on the outstanding shares of Preferred Stock in
Common Stock of the Corporation, the Holder of each share of Preferred Stock
shall receive that number of shares of Common Stock equal to the product of (a)
the quotient of (i) the Dividend Rate divided by (ii) the average of' the
closing bid quotation of the Corporation's Common Stock as reported on the
National Association of Securities Dealers Automated Quotation system
("NASDAQ"), or if the Common Stock is not listed for trading on the NASDAQ but
is listed for trading on a national securities exchange, the average closing bid
price of the Common Stock as quoted on such national exchange, for the five (5)
trading days immediately prior to the Dividend Declaration Date (the "Stock
Dividend Price"), times (b) a fraction, the numerator of which is the number of
days elapsed during the period for which the dividend is to be paid, and the
denominator of which is 365. Dividends on the Preferred Stock shall be
cumulative, and no dividends or other distributions shall be paid or declared or
set aside for payment on the Corporation's Common Stock until all accrued and
unpaid dividends on all outstanding shares of Preferred Stock shall have been
paid or declared and set aside for payment.



-1-


2. Voting.

Except as provided under Section 242 of the GCL, holders of Preferred Stock
(the "Holders") shall not have the right to vote on any matter. Notwithstanding
the provisions of Section 242 of the GCL or Section 4 hereof, the number of
authorized shares of any class or classes of stock of the Corporation may be
increased or decreased (but not below the number of shares thereof outstanding)
by the affirmative vote of the holders of a majority of the stock of the
Corporation entitled to vote thereon, voting together as a single class,
irrespective of the provisions of Section 242 of the GCL.

3. Liquidation.

In the event of a voluntary or involuntary dissolution, liquidation, or
winding up of the Corporation, the Holders of Preferred Stock shall be entitled
to receive out of the assets of the Corporation legally available for
distribution to holders of its capital stock, before any payment or distribution
shall be made to holders of shares of Common Stock or any other class of stock
ranking junior to the Preferred Stock, an amount per share of Preferred Stock
equal to $1,000 (the "Liquidation Value") plus any accrued and unpaid dividends
on the Preferred Stock. If upon such liquidation, dissolution, or winding up of
the Corporation, whether voluntary or involuntary, the assets to be distributed
among the Holders of Preferred Stock shall be insufficient to permit payment to
the Holders of Preferred Stock of the amount distributable as aforesaid, then
the entire assets of the Corporation to be so distributed shall be distributed
ratably among the Holders of Preferred Stock and shares of such other classes or
series ranking on a parity with the shares of this Preferred Stock in proportion
to the full distributable amounts for which holders of all such parity shares
are entitled upon such distribution, liquidation, or winding up. Upon any such
liquidation, dissolution or winding up of the Corporation, after the Holders of
Preferred Stock shall have been paid in full the amounts to which they shall be
entitled, the remaining net assets of the Corporation may be distributed to the
holders of stock ranking on liquidation junior to the Preferred Stock and the
Holders of the Preferred Stock shall have no right or claim to any of the
remaining assets of the Corporation. Written notice of such liquidation,
dissolution or winding up, stating a payment date, the amount of the liquidation
payments and the place where said liquidation payments shall be payable, shall
be given by mail, postage prepaid or by telex or facsimile to non-U.S.
residents, not less than 10 days prior to the payment date stated therein, to
the Holders of record of Preferred Stock, such notice to be addressed to each
such Holder at its address as shown by the records of the Corporation. For
purposes hereof the shares of Common Stock, shall rank on liquidation junior to
the Preferred Stock.

4. Restrictions.

The Corporation will not amend or modify the terms of its Restated
Certificate of Incorporation so as to adversely alter or change the Preferred
Stock at any time when shares of Preferred Stock are outstanding, without the
approval of the Holders of at least a majority of the then outstanding shares of
Preferred Stock given in writing or by vote at a meeting,
consenting or voting (as the case may be) separately as a series, except where
the vote or written consent of the



-2-


Holders of a greater number of shares of Common Stock of the Corporation is
required by law or by the Corporation's Certificate of Incorporation, as
amended.

5.  Optional Conversion.

The Holders of shares of Preferred Stock shall have the following conversion
rights to convert the shares of Preferred Stock into shares of Common Stock of
the Corporation:

(a)    No Right to Convert. The Preferred Stock shall not be
convertible into shares of Common Stock until after April 20, 2000.

(b)   Conversion Dates. The Preferred Stock may be convertible
into shares of Common Stock at any time after April 20, 2000.

(c)    Right to Convert; Conversion Price. Subject to the terms
hereof, as used herein, the term Conversion Price per outstanding share of
Preferred Stock shall be One Dollar and 875/100 ($1.875); except that after the
expiration of one hundred and eighty (180) days after the Closing Date if the
average of the closing bid price per share of Common Stock quoted on the NASDAQ
(or the closing bid price of the Common Stock as quoted on the national
securities exchange if the Common Stock is not listed for trading on the NASDAQ
but is listed for trading on a national securities exchange) for the five (5)
trading days immediately prior to the particular date of each Conversion Notice
(as defined below) is less than Two Dollars and 34/100 ($2.34), then the
Conversion Price for that particular conversion shall be eighty percent (80%) of
the average of the closing bid price of the Common Stock on the NASDAQ (or if
the Common Stock is not listed for trading on the NASDAQ but is listed for
trading on a national securities exchange then eighty percent (80%) of the
average of the closing bid price of the Common Stock on the national securities
exchange) for the five (5) trading days immediately prior to the particular date
of the Conversion Notice. Notwithstanding the foregoing, the Conversion Price
shall not be less than a minimum of $1.50 per share ("Minimum Conversion Price")
for a period of twenty-four (24) months from April 20, 1999. 

          If any of the outstanding shares of Preferred Stock are converted, in whole
or in part, into Common Stock pursuant to the terms of this Section 5(c), the
number of shares of whole Common Stock to be issued to the Holder as a result of
such conversion shall be determined by dividing (a) the aggregate Stated Value
of the Preferred Stock so surrendered for conversion by (b) the Conversion Price
in effect on the date of that particular Conversion Notice relating to such
conversion. At the time of conversion of shares of the Preferred Stock, the
Corporation shall pay in cash to the holder thereof an amount equal to all
unpaid and accrued dividends, if any, accrued thereon on the shares of Preferred
so converted to the date of the Conversion Notice relating to such conversion,
or, at the Corporation's option, in lieu of paying cash for the accrued and
unpaid dividends, issue that number of shares of whole Common Stock which is
equal to the quotient of the amount of such unpaid and accrued dividends to the
date of the Conversion Notice relating to such conversion of the shares of
Preferred Stock so converted divided by the Stock Dividend Price, in effect at
the date of the Conversion Notice relating to such conversion.



-3-


(d)    Conversion Notice. The right of conversion shall be
exercised by the Holder thereof by telecopying or faxing an executed and
completed written notice signed by an authorized representative of the Holder,
("Conversion Notice") to the Corporation that the Holder elects to convert a
specified number of shares of Preferred Stock representing a specified Stated
Value thereof into shares of Common Stock and by delivering by express courier
the certificate or certificates of Preferred Stock being converted to the
Corporation at its principal office (or such other office or agency of the
Corporation as the Corporation may designate by notice in writing to the Holders
of the Preferred Stock). The business date indicated on a Conversion Notice
which is telecopied to and received by the Corporation in accordance with the
provisions hereof shall be deemed a Conversion Date. The Conversion Notice shall
include therein the Stated Value of shares of Preferred Stock to be converted,
and a calculation (a) of the Stock Dividend Price, (b) the Conversion Price, and
(c) the number of Shares of Common Stock to be issued in connection with such
conversion. The Corporation shall have the right to review the calculations
included in the Conversion Notice, and shall provide notice of any discrepancy
or dispute therewith within three (3) business days of the receipt thereof. The
Holder shall deliver to the Corporation an original Conversion Notice and the
original Preferred to be converted within three (3) business days from the date
of the Conversion Notice.

(e)    Issuance of Certificates - Time Conversion Effected.
Promptly, but in no event more than six (6) business days,
after the receipt by facsimile of the Conversion Notice referred to in
Subparagraph (5)(c); and provided within the six (6) business days the
Corporation receives the certificate or certificates for the shares of Preferred
Stock to be converted, the Corporation shall issue and deliver, or cause to be
issued and delivered, to the Holder, registered in the name of the Holder, a
certificate or certificates for the number of whole shares of Common Stock into
which such shares of Preferred Stock are converted. Such conversion shall be
deemed to have been effected as of the close of business on the date on which
the telecopy or facsimile Conversion Notice shall have been received by the
Corporation, and the rights of the Holder of such share or shares of Preferred
Stock shall cease, at such time, and the Holder or Holders shall be deemed to
have become the Holder or Holders of record of the shares of Common Stock
represented thereby. 

In the event that the shares of Common Stock issuable upon conversion of the
Preferred, are not delivered within six (6) business days of the date the
Corporation receives the Conversion Notice, the Corporation shall pay to the
Holder, by wire transfer, as liquidated damages for such failure and not as a
penalty, for each $100,000 of Preferred sought to be converted, $500 for each of
the first five (5) calendar days and $1,000 per calendar day thereafter that the
shares of Common Stock are not delivered, which liquidated damages shall begin
to run from the seventh (7th) business day after the Conversion Date. Any and
all payments required pursuant to this paragraph shall be payable only in cash.
Notwithstanding the above, liquidated damages shall not exceed $2,000.00 per
day. In addition to the liquidated damages set forth herein, in the event the
Corporation fails to deliver the shares of Common Stock within six (6) business
days after the Conversion date, the Corporation agrees to issue the larger
number of shares of Common Stock derived from (i) the original Conversion
Notice, or (ii) utilizing the five lowest closing bid prices of the
Corporation's shares of Common Stock beginning on the Conversion Date and ending
on the day the shares of Common Stock are delivered. The Corporation



-4-


understands that a delay in the issuance of the shares of Common Stock could
result in economic loss to the Holder. Nothing contained herein, or in the
Preferred shall limit the Holder's rights to pursue actual damages for the
Corporation's failure to issue and deliver shares of Common Stock to the Holder
in accordance with the terms of the Certificate of Designations, and this
Agreement. 

(f)  Fractional Shares of Common Stock. No fractional shares
of Common Stock shall be issued upon conversion of any Preferred Stock into
shares of Common Stock. All fractional shares of Common Stock shall be
aggregated and then rounded down to the nearest whole share of Common Stock. In
case the number of shares of Preferred Stock represented by the certificate or
certificates surrendered pursuant to Subparagraph 5(d) exceeds the number of
shares of Common Stock converted, the Corporation shall, upon such conversion,
execute and deliver to the Holder, at the expense of the Corporation, a new
certificate or certificates for the number of shares of Preferred Stock
represented by the certificate or certificates surrendered which are not to be
converted.

(g)  Merger or Consolidation. In case of either (a) any
merger or consolidation to which the Corporation is a party (collectively, the
"Merger"), other than a Merger in which the Corporation is the surviving or
continuing corporation, or (b) any sale or conveyance to another corporation of
all, or substantially all, of the assets of the Corporation (collectively, the
"Sale"), and such Merger or Sale becomes effective while any shares of Preferred
Stock are outstanding and prior to the date that the Corporation's Registration
Statement covering all the shares of Common Stock issuable upon the conversion
of the Preferred Stock is declared effective by the U.S. Securities and Exchange
Commission ("Commission"), the Corporation or such successor corporation as the
case may be, shall make appropriate provision so that the Holder of each share
of Preferred Stock then outstanding shall have the right to convert such share
of Preferred Stock into the kind and amount of shares of stock or other
securities and property receivable upon such Merger or Sale by a holder of the
number of shares of Common Stock into which such shares of Preferred Stock could
have been converted into immediately prior to such Merger or Sale, subject to
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Section 5.

In the event of a Merger or Sale, where the Corporation is not the surviving
Corporation, the Holder shall have the right to redeem all of the outstanding
shares of Preferred Stock at 120% of the Liquidation Value of each share of
Preferred Stock then outstanding plus all accrued and unpaid dividends (the
"Redemption Amount"). The Corporation shall pay this Redemption Amount in cash
within ten (10) business days of receipt by the Corporation of notice from the
Holder, and receipt by the Corporation of all outstanding shares of Preferred
Stock duly endorsed by the Holder to the Corporation.

(h)  Adjustments to Conversion Price for Stock
Dividends and for Combinations or Subdivisions of Common Stock. If the
Corporation at any time or from time to time while shares of Preferred Stock are
issued and outstanding shall declare or pay, any dividend on the Common Stock
payable in Common Stock, or shall effect a subdivision of the outstanding shares
of Common Stock into a greater number of shares of Common Stock (by stock split,
reclassification or otherwise than by payment of a dividend in Common Stock), or
if the outstanding shares of



-5-


Common Stock shall be combined or consolidated, by reclassification or
otherwise, into a lesser number of shares of Common Stock, then the Conversion
Price in effect immediately before such event shall, concurrently with the
effectiveness of such event, be proportionately decreased or increased, as
appropriate.

(i)  Adjustments for Reclassification and Reorganization. If
the Common Stock issuable upon conversion of the Preferred Stock shall be
changed into the same or a different number of shares of Common Stock of any
other class or classes of stock, whether by capital reorganization,
reclassification or otherwise (other than a subdivision or combination or shares
of Common Stock provided for in Section 5(h) hereof), the Conversion Price then
in effect shall, concurrently with the effectiveness of such reorganization or
reclassification, be proportionately adjusted so that the Preferred Stock shall
be convertible into, in lieu of the number of shares of Common Stock which the
holders of Preferred Stock would otherwise have been entitled to receive, a
number of shares of Common Stock of such other class or classes of stock
equivalent to the number of shares of Common Stock that would have been subject
to receipt by the holders upon conversion of the Preferred Stock immediately
before that change.

6 Redemption.

(a)  Redemption at Corporation's Option. Except as otherwise
provided in this Section 6, at any time, and from time to time, the Corporation
may, at its sole option, but shall not be obligated to, redeem, in whole or in
part, at any time, and from time to time the then outstanding Series 16 Class P
Preferred Stock at the following cash redemption prices if redeemed during the
following periods: (i) within twelve (12) months from
April 20, 1999 - $1,100 per share, and (ii) after twelve (12) months
from April 20, 1999 - $1,200 per share (as applicable, the
redemption price of $1,100 or $1,200 is referred to herein as the "Redemption
Price").

(b)  Mechanics of Redemption. Prior to any date stipulated by
the Corporation for the redemption of Series 16 Class P Preferred Stock (the
"Redemption Date"), written notice (the "Redemption Notice") shall be mailed to
each holder of record on such notice date of the Series 16 Class P Preferred
Stock. The Redemption Notice shall state: (i) the Redemption Date of such
shares, (ii) the number of Series 16 Class P Preferred Stock to be redeemed from
the holder to whom the Redemption Notice is addressed, (iii) instructions for
surrender to the Corporation, in the manner and at the place designated, of a
share certificate or share certificates representing the number of Series 16
Class P Preferred Stock to be redeemed from such holder, and (iv) instructions
as to how to specify to the Corporation the number of Series 16 Class P
Preferred Stock to be redeemed as provided in this Part 6 and, if the Redemption
Notice is mailed to the Holder after the first twelve (12) months from April 20,
1999, the number of shares to be converted into Common Stock as provided in Part
5 hereof.

(c)  Rights of Conversion Upon Redemption. If the redemption
occurs during the first twelve (12) months after April 20, 1999, the holder may
not convert any redeemed shares. If the redemption occurs after the first twelve
(12) months after April 20, 1999, then, upon receipt of the Redemption Notice,
any holder of Series 16 Class P Preferred Stock shall have five business days
during which it may exercise the



-6-
 

option, at its sole election, to specify what portion of its Series 16 Class
P Preferred Stock called for redemption in the Redemption Notice shall be
redeemed as provided in this Part 6 or converted into Common Stock in the manner
provided in Part 5 hereof, except that, notwithstanding any provision of such
Part 5 to the contrary, after twelve (12) months from April 20, 1999, such
holder shall have the right to convert into Common Stock that number of Series
16 Class P Preferred Stock called for redemption in the Redemption Notice.

(d)  Surrender of Certificates. On or before the Redemption
Date in respect of any Series 16 Class P Preferred Stock, each holder of such
shares shall surrender the required certificate or certificates representing
such shares to the Corporation in the manner and at the place designated in the
Redemption Notice, and upon the Redemption Date, the Redemption Price for such
shares shall be made payable, in the manner provided hereof, to the order of the
person whose name appears on such certificate or certificates as the owner
thereof, and each surrendered share certificate shall be canceled and retired.
If a share certificate is surrendered and all the shares evidenced thereby are
not being redeemed (as described below), the Corporation shall cause the Series
16 Class P Preferred Stock which are not being redeemed to be registered in the
names of the persons or entity whose names appear as the owners on the
respective surrendered share certificates and deliver such certificate to such
person.

(e)  Payment. On the Redemption Date in respect of any Series
16 Class P Preferred Stock or prior thereto, the Corporation shall deposit with
any bank or trust company having a capital and surplus of at least $50,000,000,
as a trust fund, a sum equal to the aggregate Redemption Price of all such
shares called from redemption (less the aggregate Redemption Price for those
Series 16 Class P Preferred Stock in respect of which the Corporation has
received notice from the holder thereof of its election to convert Series 16
Class P Preferred Stock into Common Stock), with irrevocable instructions and
authority to the bank or trust company to pay, on or after the Redemption Date,
the Redemption Price to the respective holders upon the surrender of their share
certificates. The deposit shall constitute full payment for the shares to their
holders, and from and after the date of the deposit the redeemed shares shall be
deemed to be no longer outstanding, and holders thereof shall cease to be
shareholders with respect to such shares and shall have no rights with respect
thereto except the rights to receive from the bank or trust company payments of
the Redemption Price of the shares, without interest, upon surrender of their
certificates thereof. Any funds so deposited and unclaimed at the end of one
year following the Redemption Date shall be released or repaid to the
Corporation, after which the former holders of shares called for redemption
shall be entitled to receive payment of the Redemption Price in respect of their
shares only from the Corporation.

7.  Assignment. 

Subject to all applicable restrictions on transfer, the rights and
obligations of the Corporation and the Holder of the Preferred Stock shall be
binding upon and benefit the successors, assigns, heirs, administrators, and
transferees of the parties.



-7-


8.  Shares of Common Stock to be Reserved.

The Corporation, upon the effective date of this Certificate of Designations,
has a sufficient number of shares of Common Stock available to reserve for
issuance upon the conversion of all outstanding shares of Preferred Stock,
pursuant to the terms and conditions set forth in Section 5, and exercise of the
Warrants as defined in Section 12. The Corporation will at all times reserve and
keep available out of its authorized shares of Common Stock, solely for the
purpose of issuance upon the conversion of Preferred Stock, and exercise of the
Warrants, as herein provided, such number of shares of Common Stock as shall
then be issuable upon the conversion of all outstanding shares of Preferred
Stock, and exercise of the Warrants. The Corporation covenants that all shares
of Common Stock which shall be so issued shall be duly and validly issued, fully
paid and non assessable. The Corporation will take such action as may be
required, if the total number of shares of Common Stock issued and issuable
after such action upon conversion of the Preferred Stock, and exercise of the
Warrants would exceed the total number of shares of Common Stock then authorized
by the Corporation's Certificate of Incorporation, as amended, or would exceed
19.99% of the shares of Common Stock then outstanding if required by law or the
Rules and Regulations of NASDAQ or the National Securities Exchange applicable
to the Corporation to take such action as a result of exceeding such 19.99%, in
order to increase the number of shares of Common Stock to permit the Corporation
to issue the number of shares of Common Stock required to effect conversion of
the Preferred, and exercise of the Warrants, to a number sufficient to permit
conversion of the Preferred Stock, and exercise of the Warrants, including,
without limitation, engaging in reasonable efforts to obtain the requisite
stockholder approval of any necessary amendment to the Corporation's Restated
Certificate of Incorporation, and to obtain shareholders approval in order to
effect conversion of the Preferred Stock, and exercise of the Warrants, if
required by law or the rules or regulations of the NASDAQ or National Securities
Exchange applicable to the Corporation.

8(a)  Shareholder Approval. In connection
with the issuance to the Holder of the shares of Preferred Stock, pursuant to
this Certificate of Designations, the Corporation is also issuing (i) certain
warrants ("RBB Warrants") to the Holder pursuant to the terms of that certain
Private Securities Subscription Agreement dated June 30, 1998 (the "Agreement"),
providing for the purchase of up to 150,000 shares of Common Stock at an
exercise price of $2.50 per share and (ii) certain warrants (collectively, the
"Liviakis Warrants") to Liviakis Financial Communication, Inc. ("Liviakis") and
Robert B. Prag providing for the purchase of up to an aggregate of 2,500,000
shares of Common Stock at an exercise price of $1.875 per share pursuant to the
terms of that Liviakis Agreement dated June 30, 1998, between Liviakis and the
Corporation.

If (i) the aggregate number of shares of Common Stock issued by the
Corporation as a result of any or all of the following: (a) conversion of the
Preferred Stock, (b) payment of dividends accrued on the Preferred Stock (c)
exercise of the RBB Warrants, and (d) exercise of the Liviakis Warrants exceeds
2,388,347 shares of Common Stock (which equals 19.9% of the outstanding shares
of Common Stock of the Corporation as of the date of this Certificate of
Designations) and (ii) the Holder has converted or elects to convert any of the
then outstanding shares of Preferred Stock pursuant to the terms of Section 5 at
a Conversion Price less than $ 1.875 ($1.875 being the market



-8-


value per share of Common Stock as quoted on the NASDAQ as of the close of
business on June 30, 1998) pursuant to the terms of Section 5(c) hereof, other
than if the Conversion Price is less than $ 1.875 solely as a result of the
anti-dilution provisions of Section 5(h) and (i) hereof, then, notwithstanding
anything in Section 5 to the contrary, the Corporation shall not issue any
shares of Common Stock as a result of receipt of a Conversion Notice unless and
until the Corporation shall have obtained approval of its shareholders entitled
to vote on the transactions in accordance with subparagraphs (25)(H)(i)d, (iv)
and (v) of Rule 4310 of the NASDAQ Marketplace Rules ("Shareholder
Approval").

If Shareholder Approval is required as set forth in the above paragraph, the
Corporation shall take all necessary steps to obtain such Shareholder Approval
upon receipt of the Conversion Notice triggering the need for Shareholder
Approval ("Current Conversion Notice"). If the Corporation has not received from
the Holder a Current Conversion Notice, the Holder, subsequent to January 1st,
1999 may, if the Corporation's shares of Common Stock trade, subsequent to
January 1st, 1999, at a five (5) day average closing bid price below Two Dollars
and 34/00 ($2.34), upon written notice to the Corporation, require the
Corporation to obtain Shareholder Approval ("Holder's Notice"). The Holder and
the Corporation's officers and directors covenant to vote all shares of Common
Stock over which they have voting control in favor of Shareholder Approval. If
the Corporation does not obtain Shareholder Approval within ninety (90) days of
the earlier of the Corporation's receipt of (i) the Current Conversion Notice or
(ii) the Holder's Notice, and the Holder has not breached its covenant to vote
all shares of Common Stock over which they have voting control in favor of
Shareholder Approval, the Corporation shall pay in cash to the Holder
liquidated damages, in an amount of 4% per month of the Liquidation Value of
each share of Preferred Stock then outstanding, commencing on the 91st day of
the Corporation's receipt of the Holder's Current Conversion Notice, and
continuing every thirty (30) days pro-rata until such time the Corporation
receives Shareholder Approval.

9.  No Reissuance of Series 16 Class P Convertible
Preferred Stock.

Shares of Preferred Stock which are converted into shares of Common Stock as
provided herein shall be retired and shall become authorized but unissued shares
of Preferred Stock, which may be reissued as part of a new series of Preferred
stock hereafter created.

10.  Closing of Books.

The Corporation will at no time close its transfer books against the transfer
of any Preferred Stock or of any shares of Common Stock issued or issuable upon
the conversion of any shares of Common Stock of Preferred Stock in
any manner which interferes with the timely conversion of such
Preferred Stock, except as may otherwise be required to comply with applicable
securities laws.
 


-9-


11.  No Preemptive Rights.

The Preferred Stock shall not give its holders any preemptive rights to
acquire any other securities issued by the Corporation at any time in the
future.

12.  Definition of Shares.

As used in this Certificate of Designations, the term "shares of Common
Stock" shall mean and include the Corporation's authorized common stock, par
value $.001, as constituted on the date of filing of these terms of the
Preferred Stock, or in case of any reorganization, reclassification, or stock
split of the outstanding shares of Common Stock thereof, the stock, securities
or assets provided for hereof. The term "Warrants" as used herein shall have the
same meaning as defined in Section 1 of the Private Securities Subscription
Agreement, dated June 30, 1998, between the Company and RBB Bank
Aktiengesellschaft.

The said determination of the designations, preferences and relative,
participating, optional or other rights, and the qualifications, limitations or
restrictions thereof, relating to the Preferred Stock was duly made by the Board
of Directors pursuant to the provisions of the Corporation's Restated
Certificate of Incorporation and in accordance with the provisions of the
Delaware General Corporation Law.
 
 

 

 

 

 



-10-



CERTIFICATE OF ELIMINATION

OF

SERIES 11 CLASS K CONVERTIBLE PREFERRED STOCK

AND

SERIES 12 CLASS L CONVERTIBLE PREFERRED STOCK

AND

SERIES 13 CLASS M CONVERTIBLE PREFERRED STOCK

OF

PERMA-FIX ENVIRONMENTAL SERVICES, INC.

____________________________________________


     PERMA-FIX ENVIRONMENTAL SERVICES, INC., a
corporation organized and existing under the General Corporation Law of the
State of Delaware (hereinafter called the "Corporation"), hereby
certifies the following:

      1.      That the
Certificate of Designations of Series 11 Class K Convertible Preferred Stock,
par value $.001 per share, of the Corporation (the "Series 11
Preferred") was filed with the Delaware Secretary of State on July 15, 1999
(the "Series 11 Certificate of Designations").

      2.     That all
outstanding shares of the Series 11 Preferred have been delivered to the Company
and exchanged pursuant to an agreement with the holder thereof in accordance
with the terms and conditions of a certain Exchange Agreement between the
Company and RBB Bank Aktiengesellschaft, dated as of August  3, 1999.

      3.      That no
shares of Series 11 Preferred remain outstanding.

      4.      That all
shares of the Series 11 Preferred which have been exchanged have the status of
authorized and unissued shares of the Preferred Stock of the Corporation without
designation as to series, until such shares are once more designated as part of
a particular series by the Board of Directors.

      5.      That
effective August 3, 1999, the Board of Directors of the Company duly adopted the
following resolutions:

              
RESOLVED, that upon completion of the exchange with the holder of the Series 11 

              
Class K Convertible Preferred Stock, no authorized shares of Series 11 Class K 

              Convertible
Preferred Stock will remain outstanding and no shares of Series 11 Class K

              
Convertible Preferred Stock will be issued subject to the Certificate of
Designations 

              
previously filed with respect to the Series 11 Class K Convertible Preferred
Stock.

              
FURTHER RESOLVED, that upon completion of the exchange, the officers of the 

              
Company are hereby authorized and directed, for and on behalf of the Company, to 

    STATE OF DELAWARE

    SECRETARY OF STATE

DIVISION OF CORPORATIONS

FILED 12:33 PM 08/10/1999

    991331581 -- 2249849

 

              
execute and deliver an appropriate Certificate of Elimination to the Secretary
of State 

              
of Delaware regarding the Series 11 Class K Convertible Preferred Stock.

      6.      That the
Certificate of Designations of the Series 12 Class L Convertible Preferred
Stock, par value $.001 per share, of the Corporation (the "Series 12
Preferred") was filed on July 15, 1999 (the "Series 12 Certificate of
Designations").

      7.      That all
outstanding shares of the Series 12 Preferred have been delivered to the Company
and exchanged pursuant to an agreement with the holder thereof in accordance
with the terms and conditions of a certain Exchange Agreement between the
Company and RBB Bank, dated as of August 3, 1999.

      8.      That no
shares of Series 12 Preferred remain outstanding.

      9.      That all
shares of the Series 12 Preferred which have been exchanged have the status of
authorized and unissued shares of the Preferred Stock of the Corporation without
designation as to series, until such shares are once more designated as part of
a particular series by the Board of Directors.

      10.     That effective
August 3, 1999, the Board of Directors of the Company duly adopted the following
resolutions:

               
RESOLVED, that upon completion of the exchange with the holder of the Series 12 

               
Class L Convertible Preferred Stock, no authorized shares of Series 12 Class L 

               
Convertible Preferred Stock will remain outstanding and no shares of Series 12 

               
Class L Convertible Preferred Stock will be issued subject to the Certificate of 

               
Designations previously filed with respect to the Series 12 Class L Convertible 

               
Preferred Stock.

              
FURTHER RESOLVED, that upon completion of the exchange, the officers of the 

              
Company are hereby authorized and directed, for and on behalf of the Company, to 

              
execute and deliver an appropriate Certificate of Elimination to the Secretary
of State 

              
of Delaware regarding the Series 12 Class L Convertible Preferred Stock.

      11.     That the
Certificate of Designations of the Series 13 Class M Convertible Preferred
Stock, par value $.001 per share, of the Corporation (the "Series 13
Preferred") was filed on July 15, 1999 (the "Series 13 Certificate of
Designations").

      12.     That all
outstanding shares of the Series 13 Preferred have been delivered to the Company
and exchanged pursuant to an agreement with the holder thereof in accordance to
the terms and conditions of a certain Exchange Agreement between the Company and
RBB Bank, dated as of August 3, 1999.

-2-

 

      13.     That no shares of
Series 13 Preferred remain outstanding.

      14.     That all shares of
the Series 13 Preferred which have been exchanged have the status of authorized
and unissued shares of the Preferred Stock of the Corporation without
designation as to series, until such shares are once more designated as part of
a particular series by the Board of Directors.

      15.     That effective
August 3, 1999, the Board of Directors of the Company duly adopted the following
resolutions:

               
RESOLVED, that upon completion of the exchange with the holder of the Series 13 

               
Class M Convertible Preferred Stock, no authorized shares of Series 13 Class M 

               
Convertible Preferred Stock will remain outstanding and no shares of Series 13 

               
Class M Convertible Preferred Stock will be issued subject to the Certificate of 

               
Designations previously filed with respect to the Series 13 Class M Convertible 

               
Preferred Stock.

               
FURTHER RESOLVED, that upon completion of the exchange, the officers of the 

               
Company are hereby authorized and directed, for and on behalf of the Company, to 

               
execute and deliver an appropriate Certificate of Elimination to the Secretary
of State 

               
of Delaware regarding the Series 13 Class M Convertible Preferred Stock.

      16.     That pursuant to
the provisions of Section 151(g) of the Delaware General Corporation Law, upon the
effective date of the filing of this Certificate, this Certificate will have the
effect of eliminating from the Restated Certificate of Incorporation only those
matters set forth in the Restated Certificate of Incorporation with respect to
the Series 11 Class K Convertible Preferred Stock, the Series 12 Class L
Convertible Preferred Stock, and the Series 13 Class M Convertible Preferred
Stock

      IN WITNESS WHEREOF, this Certificate of
Elimination has been executed this 10th day of August, 1999, by the President of
the Company.

                                                                                      PERMA-FIX
ENVIRONMENTAL

ATTEST:                                                                       
SERVICES, INC.





/s/ Richard T. Kelecy                                                     
By  /s/ Louis Centofanti                               

Richard T. Kelecy, Secretary                                               
Dr. Louis F. Centofanti, President
(SEAL)

 

 

-3-

 

Page 1

State of Delaware

Office of the Secretary of State

________________________________

 

     I, HARRIET SMITH WINDSOR, SECRETARY OF STATE OF
THE STATE OF DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY
OF THE CERTIFICATE OF DESIGNATION OF "PERMA-FIX ENVIRONMENTAL SERVICES,
INC.," FILED IN THIS OFFICE ON THE FOURTEENTH DAY OF JUNE, A.D. 2001, AT 10
O'CLOCK A.M.

     A FILED COPY OF THIS CERTIFICATE HAS BEEN
FORWARDED TO THE NEW CASTLE COUNTY RECORDER OF DEEDS.

 

 

 

 

 

 

 

                                                                                                /s/
Harriet Smith
Windsor                            

                                                                                                Harriet
Smith Windsor, Secretary of State

2249849 
8100                                                               AUTHENTICATION: 
1188603



010285655                                                                                             DATE: 
06-14-01

 
STATE OF
DELAWARE    

SECRETARY OF STATE    

DIVISION OF CORPORATIONS

FILED 10:00 AM 06/14/2001  

010285655 -- 2249849      



CERTIFICATE OF DESIGNATIONS
OF SERIES 17 CLASS Q CONVERTIBLE
PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.



          Perma-Fix Environmental Services, Inc. (the
"Corporation"), a corporation organized and existing under the General
Corporation Law of the State of Delaware, does hereby certify:

          That, pursuant to authority conferred upon by
the Board of Directors by the Corporation's Restated Certificate of
Incorporation, as amended, and pursuant to the provisions of Section 151 of the
Delaware Corporation Law, the Board of Directors of the Corporation has adopted
resolutions, a copy of which is attached hereto, establishing and providing for
the issuance of a series of Preferred Stock designated as Series 17 Class Q
Convertible Preferred Stock and has established and fixed the voting powers,
designations, preferences and relative participating, optional and other special
rights and qualifications, limitations and restrictions of such Series 17 Class
Q Convertible Preferred Stock as set forth in the attached
resolutions.

Dated: May 25, 2001.
                                                        PERMA-FIX
ENVIRONMENTAL SERVICES, INC.





                                                         By 
/s/ Louis Centofanti                                                       

                                                               Dr. Louis F.
Centofanti
                                                               Chairman of the Board


ATTEST:


/s/ Richard
T. Kelecy                                 
Richard T.
Kelecy, Secretary
 

 

 

 



PERMA-FIX ENVIRONMENTAL SERVICES,
INC.

(the "Corporation")

RESOLUTION OF THE BOARD OF
DIRECTORS

FIXING THE NUMBER AND DESIGNATING THE RIGHTS,
PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 17 CLASS Q
CONVERTIBLE PREFERRED STOCK

RE: DESIGNATION OF SERIES 17
CLASS Q CONVERTIBLE PREFERRED STOCK.

RESOLVED: That the designations,
powers, preferences and rights of the Series 17 Class Q Convertible Preferred
Stock be, and they hereby are, as set forth below:
1.  Designation, Number of Shares of Preferred
Stock of Series 17 Class Q
Convertible 
     Preferred Stock and
Dividends. 
The
Corporation hereby authorizes the issuance of up to two thousand five hundred
(2,500) shares of Series 17 Class Q Convertible Preferred Stock, par value $.001
per share (the "Preferred Stock"). The holders of the Preferred Stock
(individually, the "Holder," and collectively, the "Holders") are entitled to
receive if, when and as declared by the Board of Directors of the Corporation
(the"Board") out of funds legally available therefore, cumulative dividends at
an annual dividend rate, based on a 365 day calendar year, of 5% of the
Liquidation Value (as defined in Section 3 hereof) ("Dividend Rate") for each
share of the Preferred Stock then issued and outstanding as of the acceptable
declaration of such dividend, payable semiannually within ten (10) business days
after each subsequent June 30th and December 31st (each a "Dividend Declaration
Date"), and shall be payable in cash or shares of the Corporation's common
stock, par value $.001 per share ("Common Stock"), at the Corporation's option.
The first Dividend Declaration Date shall be December 31st, 2001. Dividends
shall be paid only with respect to the shares of Preferred Stock actually issued
and outstanding on the Dividend Declaration Date and to Holders of record on the
Dividend Declaration Date. Dividends shall accrue from the first day of the
semi-annual dividend period in which such dividend may be payable, except with
respect to the first semi-annual dividend which shall accrue from the date of
the issuance of the Preferred Stock.

In the event that the Board elects to pay the accrued
dividends due as of a Dividend Declaration Date on the outstanding shares of
Preferred Stock in Common Stock of the Corporation, the Holder of each share of
Preferred Stock shall receive that number of shares of Common Stock equal to the
product of (a) the quotient of (i) the Dividend Rate divided by (ii) the average
of the average closing bid quotation of the Corporation's Common Stock as
reported on the National Association of Securities Dealers Automated

 

-1-

 

Quotation
system ("NASDAQ"), or if the Common Stock is not listed for trading on the
NASDAQ but is listed for trading on a national securities exchange, the average
closing price of the Common Stock as quoted on such national exchange, for the
five (5) trading days immediately prior to the Dividend Declaration Date (the
"Stock Dividend Price"), times (b) a fraction, the numerator of which is the
number of days elapsed during the period for which the dividend is to be paid,
and the denominator of which is 365. Dividends on the Preferred Stock shall be
cumulative, and no dividends or other distributions shall be paid or declared or
set aside for payment on the Corporation's Common Stock until all accrued and
unpaid dividends on all outstanding shares of Preferred Stock shall have been
paid or declared and set aside for payment.

2.  Voting.

Except as provided under Section 242(2) of the Delaware
General Corporation Law ("GCL"), the Preferred Stock shall not have any voting
rights and the Holders of the Preferred Stock shall not have the right to vote
on any matter. Notwithstanding the provisions of Section 242 of the GCL, the
number of authorized shares of any class or classes of stock of the Corporation
may be increased or decreased (but not below the number of shares thereof then
outstanding) by the affirmative vote of the holders of a majority of the stock
of the Corporation entitled to vote thereon, voting together as a single class,
irrespective of the provisions of Section 242 of the GCL.

3.  Liquidation.

In the event of a voluntary or involuntary dissolution,
liquidation, or winding up of the Corporation, the Holders of the Preferred
Stock shall be entitled to receive out of the assets of the Corporation legally
available for distribution to holders of its capital stock, before any payment
or distribution shall be made to holders of shares of Common Stock or any other
class of stock ranking junior to the Preferred Stock, an amount per share of the
Preferred Stock equal to $1,000 (the "Liquidation Value"), plus any accrued and
unpaid dividends on the Preferred Stock. If upon such liquidation, dissolution,
or winding up of the Corporation, whether voluntary or involuntary, the assets
to be distributed among the Holders of the Preferred Stock shall be insufficient
to permit payment to the Holders of the Preferred Stock of the amount
distributable as aforesaid, then the entire assets of the Corporation to be so
distributed shall be distributed ratably among the Holders of the Preferred
Stock and shares of such other classes or series ranking on a parity with the
shares of the Preferred Stock in proportion to the full distributable amounts
for which holders of all such parity shares are entitled upon such distribution,
liquidation, or winding up. Upon any such liquidation, dissolution or winding up
of the Corporation, after the Holders of Preferred Stock shall have been paid in
full the amounts to which they shall be entitled, the remaining net assets of
the Corporation may be distributed to the holders of stock ranking on
liquidation junior to the Preferred Stock and the Holders of the Preferred Stock
shall have no right or claim to any of the remaining assets of the Corporation.
Written notice of such liquidation, dissolution or winding up, stating a payment
date, the amount of the liquidation payments and the place where said
liquidation payments shall be payable, shall be given by mail, postage

-2-

 

prepaid
or by telex or facsimile to non-U.S. residents, not less than 10 days prior to
the payment date stated therein, to the Holders of record of the Preferred
Stock, such notice to be addressed to each such Holder at its address as shown
by the records of the Corporation. For purposes hereof, the shares of Common
Stock shall rank on liquidation junior to the Preferred Stock.

4.  Optional Conversion.

The Holders of shares of Preferred Stock shall have the
following conversion rights to convert the shares of Preferred Stock into shares
of Common Stock of the Corporation as follows:

(a)  Intentionally left
blank.

(b)  Right to Convert; Conversion
Price. Subject to the terms hereof, as used herein, the term Conversion
Price per outstanding share of Preferred Stock shall be One Dollar and 50/100
($1.50). If any of the outstanding shares of Preferred Stock are converted, in
whole or in part, into Common Stock pursuant to the terms of this Section 4, the
number of shares of whole Common Stock to be issued as a result of such
conversion shall be determined by dividing (a) the aggregate Liquidation Value
of the Preferred Stock so surrendered for conversion by (b) the Conversion Price
in effect on the date of that particular Conversion Notice relating to such
conversion. At the time of conversion of shares of the Preferred Stock, the
Corporation shall pay in cash to the Holder thereof an amount equal to all
unpaid and accrued dividends, if any, accrued thereon on the shares of the
Preferred Stock so converted to the date of the Conversion Notice relating to
the shares of Preferred Stock so converted under such conversion, or, at the
Corporation's option, in lieu of paying cash for the accrued and unpaid
dividends, issue that number of shares of whole Common Stock which is equal to
the quotient of the amount of such unpaid and accrued dividends to the date of
the Conversion Notice relating to such conversion of the shares of Preferred
Stock so converted divided by the Stock Dividend Price in effect at the date of
the Conversion Notice relating to such conversion.

(c)  Conversion Notice. The right of
conversion shall be exercised by the Holder thereof by telecopying or faxing an
executed and completed written notice signed by an authorized representative of
the Holder ("Conversion Notice"), to the Corporation that the Holder elects to
convert a specified number of shares of Preferred Stock representing a specified
Liquidation Value thereof into shares of Common Stock and by delivering by
express courier the certificate or certificates of Preferred Stock being
converted to the Corporation at its principal office (or such other office or
agency of the Corporation as the Corporation may designate by notice in writing
to the Holders of the Preferred Stock). The business date indicated on a
Conversion Notice which is telecopied to and received by the Corporation in
accordance with the provisions hereof shall be deemed a Conversion Date. The
Conversion Notice shall include therein the Liquidation Value of the shares of
Preferred Stock to be converted, and a calculation (a) of the Stock Dividend
Price, (b) the Conversion Price, and (c) the number of shares of Common Stock to
be issued in connection with such conversion. The Corporation shall have the
right to review the calculations included in the Conversion Notice, and shall
provide notice of any discrepancy or dispute therewith within five (5) business
days of the

-3-

 

receipt thereof. The Holder shall deliver to the Corporation an
original Conversion Notice and the original Preferred to be converted within
three (3) business days from the date of the Conversion Notice.

(d)  Issuance of Certificates - Time Conversion
Effected. Promptly, but in no event more than fifteen
(15) business days, after the receipt by facsimile of the Conversion Notice
referred to in Section 4(c); and provided within the ten (10) business days the
Corporation receives the certificate or certificates for the shares of Preferred
Stock to be converted, the Corporation shall issue and deliver, or cause to be
issued and delivered, to the Holder, registered in the name of the Holder, a
certificate or certificates for the number of whole shares of Common Stock into
which such shares of Preferred Stock are converted. Such conversion shall be
deemed to have been effected as of the close of business on the date on which
the telecopy or facsimile Conversion Notice shall have been received by the
Corporation, and the rights of the Holder of such share or shares of Preferred
Stock shall cease at such time, and the Holder or Holders shall be deemed to
have become the holder or holders of record of the shares of Common Stock
represented thereby. 

(e)  Fractional Shares of Common Stock.
No fractional shares of Common Stock shall be issued upon conversion of any
Preferred Stock into shares of Common Stock. All fractional shares of Common
Stock shall be aggregated and then rounded down to the nearest whole share of
Common Stock. In case the number of shares of Preferred Stock represented by the
certificate or certificates surrendered pursuant to this Section 4(e) exceeds
the number of shares of Common Stock converted, the Corporation shall, upon such
conversion, execute and deliver to the Holder, at the expense of the
Corporation, a new certificate or certificates for the number of shares of
Preferred Stock represented by the certificate or certificates surrendered which
are not to be converted.

(f)  Merger or Consolidation. In case
of either (a) any merger or consolidation to which the Corporation is a party
(collectively, the "Merger"), other than a Merger in which the Corporation is
the surviving or continuing corporation, or (b) any sale or conveyance to
another corporation of all, or substantially all, of the assets of the
Corporation (collectively, the "Sale"), and such Merger or Sale becomes
effective while any shares of Preferred Stock are outstanding and prior to the
date that the Corporation's Registration Statement covering all the Conversion
Shares is declared effective by the U. S. Securities and Exchange Commission
("SEC"), the Corporation or such successor corporation as the case may be, shall
make appropriate provision so that the Holder of each share of Preferred Stock
then outstanding shall have the right to convert such share of Preferred Stock
into the kind and amount of shares of stock or other securities and property
receivable upon such Merger or Sale by a holder of the number of shares of
Common Stock into which such shares of Preferred Stock could have been converted
into immediately prior to such Merger or Sale, subject to adjustments which
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Section 4.

(g)  Adjustments to Conversion Price for Stock
Dividends and for Combinations or Subdivisions of Common Stock. If the
Corporation, at any time or from time to time while shares of Preferred Stock
are issued and outstanding, shall declare or pay, any dividend on the Common
Stock payable in Common Stock, or shall effect a subdivision of the outstanding
shares of Common Stock into a greater number of

-4-

 

shares of Common Stock (by stock
split, reclassification or otherwise than by payment of a dividend in Common
Stock), or if the outstanding shares of Common Stock shall be combined or
consolidated, by reclassification or otherwise, into a lesser number of shares
of Common Stock, then the Conversion Price in effect immediately before such
event shall, concurrently with the effectiveness of such event, be
proportionately decreased or increased, as appropriate.

(h)  Adjustments for Reclassification and
Reorganization. If the Common Stock issuable upon conversion of the
Preferred Stock shall be changed into the same or a different number of shares
of common stock of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise (other than a subdivision or
combination or shares of Common Stock provided for in Section 5(g) hereof), the
Conversion Price then in effect shall, concurrently with the effectiveness of
such reorganization or reclassification, be proportionately adjusted so that the
Preferred Stock shall be convertible into, in lieu of the number of shares of
Common Stock which the Holders of Preferred Stock would otherwise have been
entitled to receive, a number of shares of common stock of such other class or
classes of stock equivalent to the number of shares of Common Stock that would
have been subject to receipt by the Holders upon conversion of the Preferred
Stock immediately before that change.

(i)  Other Adjustments to Conversion
Price. Except as provided in subsection 4(j), if, after the Closing
Date and during the period that any of the Preferred Stock is issued and
outstanding, the Corporation shall sell (a) any shares of Common Stock for a
consideration per share less than the Conversion Price in effect immediately
prior to such sale, or (b) any rights, warrants or other securities entitling
the holders thereof to convert such securities into Common Stock at a price per
share (determined by dividing (i) the total amount, if any, received or
receivable by the Corporation in consideration of the sale of such rights,
warrants or other securities plus the total amount, if any, payable to the
Corporation upon exercise or conversion thereof by (ii) the number of additional
shares of Common Stock issuable upon exercise or conversion of such securities)
which is less than the Conversion Price in effect on the date of such sale, the
Conversion Price shall be adjusted as of the date of such sale to the amount per
share received and to be received by the Corporation in connection with such
sale, conversion and exercise as determined above. The Holders may, if approved
by the Holders of record representing a majority of the then issued and
outstanding shares of Preferred Stock, waive their rights to any adjustment to
the Conversion Price in connection with a particular sale covered by this
Section 4(i), and, in the event of such waiver, no adjustment to the Conversion
Price shall be made under this Section 4(i) as a result of such sale.

(j)  No Adjustments.
No adjustment in the Conversion Price shall be required in the case of (i) the
grant by the Corporation of stock options to employees of the Corporation under
a Stock Option Plan approved by the stockholders of the Company or (ii) the
issuance of shares of Common Stock upon the exercise of stock options (a)
referred to in clause (i) hereof and (b) granted by the Corporation which grant
had triggered an adjustment in the Conversion Price.

 

-5-

 

5.  Redemption.

(a)  Redemption at Corporation's
Option. Except as otherwise provided in this Section 5, at any time,
and from time to time, the Corporation may, at its sole option, but shall not be
obligated to, redeem, in whole or in part, at any time, and from time to time
the then outstanding Preferred Stock at the following cash redemption prices if
redeemed during the following periods: (i) within twelve (12)
months from June 1, 2001 - $1,100 per share, and (ii) after June 1, 2002 -
$1,200 per share (as applicable, the redemption price of $1,100 or $1,200 is
referred to herein as the "Redemption Price").

(b)  Mechanics of Redemption. Prior to
any date stipulated by the Corporation for the redemption of Preferred Stock
(the "Redemption Date"), written notice (the "Redemption Notice") shall be
mailed to each Holder of record on such notice date of the Preferred Stock. The
Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the
number of Preferred Stock to be redeemed from the holder to whom the Redemption
Notice is addressed, (iii) instructions for surrender to the Corporation, in the
manner and at the place designated, of a share certificate or share certificates
representing the number of Preferred Stock to be redeemed from such Holder, and
(iv) instructions as to how to specify to the Corporation the number of
Preferred Stock to be redeemed as provided in this Section 5.

(c)  Rights of Conversion Upon
Redemption. If the redemption occurs, then, upon receipt of the
Redemption Notice, any Holder of Preferred Stock shall have five business days
during which it may exercise the option, at its sole election, to specify what
portion of its Preferred Stock called for redemption in the Redemption Notice
shall be redeemed as provided in this Section 5 or converted into Common Stock
in the manner provided in Section 4 hereof.

(d)  Surrender of Certificates. On or
before the Redemption Date in respect of any Preferred Stock, each holder of
such shares shall surrender the required certificate or certificates
representing such shares to the Corporation in the manner and at the place
designated in the Redemption Notice, and upon the Redemption Date, the
Redemption Price for such shares shall be made payable, in the manner provided
hereof, to the order of the person whose name appears on such certificate or
certificates as the owner thereof, and each surrendered share certificate shall
be canceled and retired. If a share certificate is surrendered and all the
shares evidenced thereby are not being redeemed (as described below), the
Corporation shall cause the Preferred Stock which are not being redeemed to be
registered in the names of the persons or entity whose names appear as the
owners on the respective surrendered share certificates and deliver such
certificate to such person.

(e)  Payment. On the Redemption Date in
respect of any Preferred Stock or prior thereto, the Corporation shall deposit
with any bank or trust company having a capital and surplus of at least
$50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of
all such shares called from redemption (less the aggregate Redemption Price for
those Preferred Stock in respect of which the Corporation has received notice
from the holder thereof of its election to convert Preferred Stock into Common
Stock), with irrevocable instructions and authority to the bank or trust company
to pay, on or after the Redemption Date,

 

-6-

 

the Redemption Price to the respective
holders upon the surrender of their share certificates. The deposit shall
constitute full payment for the shares to their holders, and from and after the
date of the deposit the redeemed shares shall be deemed to be no longer
outstanding, and holders thereof shall cease to be shareholders with respect to
such shares and shall have no rights with respect thereto except the rights to
receive from the bank or trust company payments of the Redemption Price of the
shares, without interest, upon surrender of their certificates thereof. Any
funds so deposited and unclaimed at the end of one year following the Redemption
Date shall be released or repaid to the Corporation, after which the former
holders of shares called for redemption shall be entitled to receive payment of
the Redemption Price in respect of their shares only from the
Corporation.

6.  Assignment. 

Subject to all applicable restrictions on transfer, the
rights and obligations of the Corporation and the Holder of the Preferred Stock
shall be binding upon and benefit the successors, assigns, heirs,
administrators, and transferees of the parties.

7.  Shares of Common Stock to be
Reserved.

The Corporation, upon the effective date of this
Certificate of Designations, has a sufficient number of shares of Common Stock
available to reserve for issuance upon the conversion of all outstanding shares
of Preferred Stock, pursuant to the terms and conditions set forth in Section 4.
The Corporation will at all times reserve and keep available out of its
authorized shares of Common Stock, solely for the purpose of issuance upon the
conversion of Preferred Stock, as herein provided, such number of shares of
Common Stock as shall then be issuable upon the conversion of all outstanding
shares of Preferred Stock. The Corporation covenants that all shares of Common
Stock which shall be so issued shall be duly and validly issued, fully paid and
non assessable. The Corporation will take such action as may be required, if the
total number of shares of Common Stock issued and issuable after such action
upon conversion of the Preferred Stock would exceed the total number of shares
of Common Stock then authorized by the Corporation's Certificate of
Incorporation, as amended, in order to increase the number of shares of Common
Stock to permit the Corporation to issue the number of shares of Common Stock
required to effect conversion of the Preferred Stock, and exercise of the
Warrants, to a number sufficient to permit conversion of the Preferred
Stock.

8.  No Reissuance of Preferred
Stock.

Shares of Preferred Stock which are converted into
shares of Common Stock as provided herein shall be retired and shall become
authorized but unissued shares of Preferred Stock, which may be reissued as part
of a new series of preferred stock hereafter created.

 

 

-7-

 

 

9.  Closing of Books.

The Corporation will at no time close its transfer
books against the transfer of any Preferred Stock or of any shares of Common
Stock issued or issuable upon the conversion of any shares of Common Stock of
Preferred Stock in any manner which interferes with the timely
conversion of such Preferred Stock, except as may otherwise be required to
comply with applicable securities laws.

10.  No Preemptive Rights.

The Preferred Stock shall not give its holders any
preemptive rights to acquire any other securities issued by the Corporation at
any time in the future.

11.  Definition of Shares.

As used in this Certificate of Designations, the term
"shares of Common Stock" shall mean and include the Corporation's authorized
common stock, par value $.001, as constituted on the date of filing of these
terms of the Preferred Stock, or in case of any reorganization,
reclassification, or stock split of the outstanding shares of Common Stock
thereof, the stock, securities or assets provided for hereof. 

The said determination of the designations, preferences
and relative, participating, optional or other rights, and the qualifications,
limitations or restrictions thereof, relating to the Preferred Stock was duly
made by the Board of Directors pursuant to the provisions of the Corporation's
Restated Certificate of Incorporation and in accordance with the provisions of
the Delaware General Corporation Law.

 

 

 

 

-8-

 

State of Delaware

Office of the Secretary of State 

Page 1

I,
HARRIET SMITH WINDSOR, SECRETARY OF STATE OF THE STATE OF

DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT
COPY

OF THE CERTIFICATE OF DESIGNATION OF "PERMA-FIX
ENVIRONMENTAL

SERVICES, INC.," FILED IN THIS OFFICE ON THE FOURTEENTH DAY OF
JUNE,

A.D. 2001, AT 10:01 O'CLOCK A.M.


A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO
THE

NEW CASTLE COUNTY RECORDER OF DEEDS.
 

 

 

 

 

                                                                 s/
Harriet Smith
Windsor                                      
                                                                  Harriett Smith
Windsor, Secretary of State

                                                                                Authentication: 1188613

2249849 8100
                                                                                                       Date: 06-14-01

010285660
 
 



CERTIFICATE OF ELIMINATION

OF
SERIES 14 CLASS N CONVERTIBLE PREFERRED STOCK
AND
SERIES 15
CLASS O CONVERTIBLE PREFERRED STOCK
AND
SERIES 16 CLASS P CONVERTIBLE
PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES,
INC.
____________________________________________ 

     PERMA-FIX ENVIRONMENTAL SERVICES,
INC., a corporation organized and existing under the General Corporation Law of
the State of Delaware (hereinafter called the "Corporation"), hereby certifies
the following:

     1.   That the Certificate of Designations of Series 14
Class N Convertible Preferred Stock, par value $.001 per share, of the
Corporation (the "Series 14 Preferred") was filed with the Delaware Secretary of
State on August 10, 1999 (the "Series 14 Certificate of
Designations").

     2.    That a portion of the outstanding shares of the
Series 14 Preferred have been converted into common stock of the Corporation and
all of the remaining balance have been delivered to the Company and exchanged
pursuant to an agreement with the holder thereof in accordance with the terms
and conditions of a certain Conversion and Exchange Agreement between the
Company and RBB Bank Aktiengesellschaft, dated as of May 25, 2001 ("Exchange
Agreement").

     3.     That no shares of Series 14 Preferred remain
outstanding.

     4.     That all shares of the Series 14 Preferred which
have been exchanged have the status of authorized and unissued shares of the
preferred stock of the Corporation without designation as to series, until such
shares are once more designated as part of a particular series by the Board of
Directors.

     5.     That effective May 25, 2001, the Board of Directors
of the Company duly adopted the following resolutions:

              RESOLVED, that upon completion of the conversion and
exchange with the holder of the 

              Series 14 Class N Convertible Preferred Stock,
no authorized shares of Series 14 

              Class N Convertible Preferred Stock will
remain outstanding and no shares of Series 14 

              Class N Convertible Preferred
Stock will be issued subject to the Certificate of 

              Designations previously filed
with respect to the Series 14 Class N Convertible Preferred 

              Stock.

 

 

              FURTHER RESOLVED, that upon completion of the exchange,
the officers of the 

              Company are hereby authorized and directed, for and on
behalf of the Company, to execute 

              and deliver an appropriate Certificate of
Elimination to the Secretary of State of Delaware

              regarding the Series 14 Class
N Convertible Preferred Stock. 

     6.     That the Certificate of Designations of the Series
15 Class O Convertible Preferred Stock, par value $.001 per share, of the
Corporation (the "Series 15 Preferred") was filed on August 10, 1999 (the
"Series 15 Certificate of Designations").

     7.     That all outstanding shares of the Series 15
Preferred have been delivered to the Company and exchanged pursuant to the
Exchange Agreement.

     8.     That no shares of Series 15 Preferred remain
outstanding.

     9.     That all shares of the Series 15 Preferred which
have been exchanged have the status of authorized and unissued shares of the
Preferred Stock of the Corporation without designation as to series, until such
shares are once more designated as part of a particular series by the Board of
Directors.

     10.    That effective May 25, 2001, the Board of Directors
of the Company duly adopted the following resolutions:

               RESOLVED, that upon completion of the exchange with the
holder of the Series 15 

               Class O Convertible Preferred Stock no authorized shares
of Series 15 Class O 

               Convertible Preferred Stock will remain outstanding and no
shares of Series 15 

               Class O Convertible Preferred Stock will be issued subject
to the Certificate of 

  
            Designations previously filed with respect to the Series
15 Class O Convertible 

               Preferred Stock.

               FURTHER RESOLVED, that upon completion of the exchange,
the officers of the 

               Company are hereby authorized and directed, for and on
behalf of the Company, to 

               execute and deliver an appropriate Certificate of
Elimination to the Secretary of State 

               of Delaware regarding the Series 15 Class
O Convertible Preferred Stock. 

     11.     That the Certificate of Designations of the Series
16 Class P Convertible Preferred Stock, par value $.001 per share, of the
Corporation (the "Series 16 Preferred") was filed on August 10, 1999 (the
"Series 16 Certificate of Designations").

     12.     That all outstanding shares of the Series 16
Preferred have been delivered to the Company and exchanged pursuant to the
Exchange Agreement.

-2-

 

     13.     That no shares of Series 16 Preferred remain
outstanding.

     14.     That all shares of the Series 16 Preferred which
have been exchanged have the status of authorized and unissued shares of the
Preferred Stock of the Corporation without designation as to series, until such
shares are once more designated as part of a particular series by the Board of
Directors.

     15.     That effective May 25, 2001, the Board of Directors
of the Company duly adopted the following resolutions:

               RESOLVED, that upon completion of the exchange with the
holder of the Series 16 

               Class P Convertible Preferred Stock, no authorized
shares of Series 16 Class P 

               Convertible Preferred Stock will remain outstanding
and no shares of Series 16 

               Class P Convertible Preferred Stock will be issued
subject to the Certificate of 

               Designations previously filed with respect to the
Series 16 Class P Convertible 

               Preferred Stock.

               FURTHER RESOLVED, that upon completion of the exchange,
the officers of the 

               Company are hereby authorized and directed, for and on
behalf of the Company, to 

               execute and deliver an appropriate Certificate of
Elimination to the Secretary of State 

               of Delaware regarding the Series 16 Class
P Convertible Preferred Stock. 

     16.     That pursuant to the provisions of Section 151(g)
of the Delaware General Corporation Law, upon the effective date of the filing
of this Certificate, this Certificate will have the effect of eliminating from
the Restated Certificate of Incorporation only those matters set forth in the
Restated Certificate of Incorporation with respect to the Series 14 Class N
Convertible Preferred Stock, the Series 15 Class O Convertible Preferred Stock,
and the Series 16 Class P Convertible Preferred Stock

     IN WITNESS WHEREOF, this Certificate of Elimination has
been executed this 25th day of May, 2001, by the President of the
Company.

                                                                                        PERMA-FIX
ENVIRONMENTAL
ATTEST:                                                                         SERVICES,
INC.

/s/ Richard T.
Kelecy                                                        By:  /s/
Louis
Centofanti                              
Richard T. Kelecy, Secretary
                                                 Dr.
Louis F. Centofanti, President
(SEAL)
 
-3-