Document:

Exhibit 10.31

                                ESCROW AGREEMENT

         THIS ESCROW AGREEMENT (this "Agreement") is made and entered into as of
September 5th, 2000, by and The May Davis Group, a Maryland corporation (the
"Placement Agents"), TCPI, Inc., a Florida Corporation (the "Company"), and
First Union National Bank, a national banking association, as Escrow Agent
hereunder (the "Escrow Agent").

                                   BACKGROUND
                                   ----------

                  WHEREAS, the Company and the Placement Agents have entered
into a Placement Agency Agreement (the "Placement Agency Agreement"), dated as
of September 1, 2000, pursuant to which the Company proposes to offer for sale
to investors ("Investors"), from time to time, through the Placement Agent up to
Ten Million Dollars ($10,000,000) of Debentures for a total purchase price of up
to Ten Million Dollars ($10,000,000). (the "Proceeds") The Securities will be
sold to Buyer(s) pursuant to a Line of Credit Agreement (the "Credit Agreement")
between the Company and each Buyer listed on Schedule I thereto. The Credit
Agreement provides that the Buyer(s) shall deposit the purchase price of the
Debentures purchased pursuant to the Credit Agreement in a segregated escrow
account to be held by Escrow Agent in order to effectuate a disbursement of the
Proceeds to the Company at closings to be held as set forth in the Credit
Agreement. (collectively the "Closings")

                  WHEREAS, the Placement Agents intend to sell, from time to
time, the Debentures as the Company's agent on a "best efforts, basis (the
"Offering" collectively the "Offerings").

                  WHEREAS, Escrow Agent has agreed to accept, hold, and disburse
the funds deposited with it in accordance with the terms of this agreement.

                  WHEREAS, in order to establish the escrow of funds and to
effect the provisions of the Credit Agreement, the parties hereto have entered
into this Agreement.

         NOW THEREFORE, in consideration of the foregoing, it is hereby agreed
as follows:

1. Definitions. The following terms shall have the following meanings when used
herein:

         a. "Escrow Funds" shall mean the funds deposited with the Escrow Agent
pursuant to this Agreement, which funds shall include, without limitation, the
sum of up to $10,000,000.

<PAGE>

         b. "Joint Written Direction" shall mean a written direction executed by
the Placement Agents and the Company directing Escrow Agent to disburse all or a
portion of the Escrow Funds or to take or refrain from taking any action
pursuant to this Agreement.

         c. "Escrow Period" shall begin upon receipt of each Advance Notice as
specified in the Credit Agreement and shall terminate upon the earlier to occur
of the following dates:

         (i) The receipt by the Company of the funds specified in the Advance
Notice applicable to such Advance or the date upon which a determination is made
by the Company and the Placement Agents to terminate the particular Advance
Notice.

During the Escrow Period, the Company and the Placement Agents are aware that
they are not entitled to any funds received into escrow and no amounts deposited
in the Escrow Account shall become the property of the Company or the Placement
Agents or any other entity, or be subject to the debts of the Company or the
Placement Agents or any other entity.

2. Appointment of and Acceptance by Escrow Agent. The Placement Agent and the
Company hereby appoint Escrow Agent to serve as Escrow Agent hereunder. Escrow
Agent hereby accepts such appointment and, upon receipt by wire transfer of the
Escrow Funds in accordance with Section 3 below, agrees to hold, invest and
disburse the Escrow Funds in accordance with this Agreement.

3. Creation of Escrow Funds. On or prior to the date of the commencement of the
particular Escrow Period, the parties shall establish an escrow account with the
Escrow Agent, which escrow account shall be entitled as follows: TCPI, Inc./May
Davis Group, Inc. Escrow Account for the deposit of the Escrow Funds. The
Placement Agents will instruct subscribers to wire funds to the account of the
Escrow Agent as follows:

Bank: First Union National Bank of New Jersey
Routing # [intentionally ommitted]
Account # [intentionally ommitted]
Name on Account: Butler Gonzalez, LLP/First Union Escrow Account
Name on Sub-Account:  TCPI, Inc./May Davis Group, Inc.
                      Line of Credit Escrow account
Reference Sub-Account #   [intentionally ommitted]
Attn:    Robert Mercado (732) 452-3005
         Carmela Agugliaro (732) 452-3005
Only wire transfers shall be accepted.

         4. Deposits into the Escrow Account. The Placement Agents agree that
they shall promptly deliver all monies received from subscribers for the payment
of the Securities to the Escrow Agent for deposit in the Escrow Account.

                                       2
<PAGE>

         5. Disbursements from the Escrow Account.
            --------------------------------------

         (a) At such time as Escrow Agent has collected and deposited
instruments of payment in the total amount of the Proceeds, Escrow Agent shall
notify the Company and the Placement Agents. The Escrow Agent will continue to
hold such funds until Placement Agents and Company execute a Joint Written
Direction directing the Escrow Agent to disburse the Proceeds pursuant to a
closing statement signed by the Company (the "Closing Statement"). In disbursing
such funds, Escrow Agent is authorized to rely upon such Closing Statement from
Company and may accept any signatory from the Company listed on the signature
page to this Agreement and any signature from the Placement Agents that Escrow
Agent already has on file.

         For purposes of this Agreement, the term "collected funds" shall mean
all funds received by the Escrow Agent which have cleared normal banking
channels and are in the form of cash.

         6. Collection Procedure. The Escrow Agent is hereby authorized to
forward each wire for collection and, upon collection of the proceeds of each
wire deposit the collected proceeds in the Escrow Account.

         Any wires returned unpaid to the Escrow Agent shall be returned to the
Placement Agents. In such cases, the Escrow Agent will promptly notify the
Company of such return.

         7. Suspension of Performance: Disbursement Into Court. If at any time,
there shall exist any dispute between the Company and the Placement Agents with
respect to holding or disposition of any portion of the Escrow Funds or any
other obligations of Escrow Agent hereunder, or if at any time Escrow Agent is
unable to determine, to Escrow Agent's sole satisfaction, the proper disposition
of any portion of the Escrow Funds or Escrow Agent's proper actions with respect
to its obligations hereunder, or if the parties have not within 30 days of the
furnishing by Escrow Agent of a notice of resignation pursuant to Section 9
hereof, appointed a successor Escrow Agent to act hereunder, then Escrow Agent
may, in its sole discretion, take either or both of the following actions:

         a.       suspend the performance of any of its obligations (including
                  without limitation any disbursement obligations) under this
                  Escrow Agreement until such dispute or uncertainty shall be
                  resolved to the sole satisfaction of Escrow Agent or until a
                  successor Escrow Agent shall be appointed (as the case may
                  be); provided however, Escrow Agent shall continue to invest
                  the Escrow Funds in accordance with Section 8 hereof; and/or

         b.       petition (by means of an interpleader action or any other
                  appropriate method) any court of competent jurisdiction in any
                  venue convenient to Escrow Agent, for instructions with
                  respect to such dispute or uncertainty, and to the extent
                  required by law, pay into such court, for holding and
                  disposition in accordance with the instructions of such

                                       3
<PAGE>

                  court, all funds held by it in the Escrow Funds, after
                  deduction and payment to Escrow Agent of all fees and expenses
                  (including court costs and attorneys' fees) payable to,
                  incurred by, or expected to be incurred by Escrow Agent in
                  connection with performance of its duties and the exercise of
                  its rights hereunder.

         c.       Escrow Agent shall have no liability to the Company, the
                  Placement Agent, or any person with respect to any such
                  suspension of performance or disbursement into court,
                  specifically including any liability or claimed liability that
                  may arise, or be alleged to have arisen, our of or as a result
                  of any delay in the disbursement of funds held in the Escrow
                  Funds or any delay in with respect to any other action
                  required or requested of Escrow Agent.

         8. Investment of Escrow Funds. The Escrow Agent shall deposit the
Escrow Funds in an insured non-interest bearing money market account.

         If Escrow Agent has not received a Joint Written Direction at any time
that an investment decision must be made, Escrow Agent shall invest the Escrow
Fund, or such portion thereof, as to which no Joint Written Direction has been
received, in investments described above. The foregoing investments shall be
made by the Escrow Agent. Notwithstanding anything to the contrary contained,
Escrow Agent may, without notice to the parties, sell or liquidate any of the
foregoing investments at any time if the proceeds thereof are required for any
release of funds permitted or required hereunder, and Escrow Agent shall not be
liable or responsible for any loss, cost or penalty resulting from any such sale
or liquidation. With respect to any funds received by Escrow Agent for deposit
into the Escrow Funds or any Joint Written Direction received by Escrow Agent
with respect to investment of any funds in the Escrow Funds after ten o'clock,
a.m., New Jersey time, Escrow Agent shall not be required to invest such funds
or to effect such investment instruction until the next day upon which banks in
New Jersey are open for business.

         9. Resignation and Removal of Escrow Agent. Escrow Agent may resign
from the performance of its duties hereunder at any time by giving ten (10)
days' prior written notice to the parties or may be removed, with or without
cause, by the parties, acting jointly, by furnishing a Joint Written Direction
to Escrow Agent, at any time by the giving of ten (10) days' prior written
notice to Escrow Agent as provided herein below. Upon any such notice of
resignation or removal, the representatives of the Placement Agents and the
Company identified in Sections 13a. (iv) and 13b. (iv), below, jointly shall
appoint a successor Escrow Agent hereunder, which shall be a commercial bank,
trust company or other financial institution with a combined capital and surplus
in excess of $10,000,000.00. Upon the acceptance in writing of any appointment
of Escrow Agent hereunder by a successor Escrow Agent, such successor Escrow
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Escrow Agent, and the retiring Escrow
Agent shall be discharged from its duties and obligations under this Escrow
Agreement, but shall not be discharged from any liability for actions taken as
Escrow Agent hereunder prior to such succession. After any

                                       4
<PAGE>

retiring Escrow Agent's resignation or removal, the provisions of this Escrow
Agreement shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Escrow Agent under this Escrow Agreement. The retiring
Escrow Agent shall transmit all records pertaining to the Escrow Funds and shall
pay all funds held by it in the Escrow Funds to the successor Escrow Agent,
after making copies of such records as the retiring Escrow Agent deems advisable
and after deduction and payment to the retiring Escrow Agent of all fees and
expenses (including court costs and attorneys' fees) payable to, incurred by, or
expected to be incurred by the retiring Escrow Agent in connection with the
performance of its duties and the exercise of its rights hereunder.

         10. Liability of Escrow Agent.
             --------------------------

         a. Escrow Agent shall have no liability or obligation with respect to
the Escrow Funds except for Escrow Agent's willful misconduct or gross
negligence. Escrow Agent's sole responsibility shall be for the safekeeping,
investment, disbursement and accounting of the Escrow Funds in accordance with
the terms of this Agreement. Escrow Agent shall have no implied duties or
obligations and shall not be charged with knowledge or notice o any fact or
circumstance not specifically set forth herein. Escrow Agent may rely upon any
instrument, not only as to its due execution, validity and effectiveness, but
also as to the truth and accuracy of any information contained therein, which
Escrow Agent shall in good faith believe to be genuine, to have been signed or
presented by the person or parties purporting to sign the same and conform to
the provisions of this Agreement. In no event shall Escrow Agent be liable for
incidental, indirect, special, and consequential or punitive damages. Escrow
Agent shall not be obligated to take any legal action or commence any proceeding
in connection with the Escrow Funds, any account in which Escrow Funds are
deposited, this Agreement or the Credit Agreement, or to appear in, prosecute or
defend any such legal action or proceeding. Escrow Agent may consult legal
counsel selected by it in any event of any dispute or question as to
construction of any of the provisions hereof or of any other agreement or its
duties hereunder, or relating to any dispute involving any party hereto, and
shall incur no liability and shall be fully indemnified from any liability
whatsoever in acting in accordance with the opinion or instructions of such
counsel. The Company and the Placement Agent jointly and severally shall
promptly pay, upon demand, the reasonable fees and expenses of any such counsel.

         b. The Escrow Agent is hereby authorized, in its sole discretion, to
comply with orders issued or process entered by any court with respect to the
Escrow Funds, without determination by the Escrow Agent of such court's
jurisdiction in the matter. If any portion of the Escrow Funds is at any time
attached, garnished or levied upon under any court order, or in case the
payment, assignment, transfer, conveyance or delivery of any such property shall
be stayed or enjoined by any court order, or in any case any order judgment or
decree shall be made or entered by any court affecting such property or ay part
thereof, then and in any such event, the Escrow Agent is authorized, in its sole
discretion, to rely upon and comply with any such order, writ judgment or

                                       5
<PAGE>

decree which it is advised by legal counsel selected by its binding upon without
the need for appeal or other action; and if the Escrow Agent complies with any
such order, writ, judgment or decree, it shall not be liable to any of the
parties hereto or to any other person or entity by reason of such compliance
even though such order, writ judgment or decree may be subsequently reversed,
modified, annulled, set aside or vacated.

         11. Indemnification of Escrow Agent. From and at all times after the
date of this Agreement, the parties jointly and severally, shall, to the fullest
extent permitted by law and to the extent provided herein, indemnify and hold
harmless Escrow Agent and each director, officer, employee, attorney, agent and
affiliate of Escrow Agent (collectively, the "Indemnified Parties") against any
and all actions, claims (whether or not valid), losses, damages, liabilities,
costs and expenses of any kind or nature whatsoever (including without
limitation reasonable attorney's fees, costs and expenses) incurred by or
asserted against any of the Indemnified Parties from and after the date hereof,
whether direct, indirect or consequential, as a result of or arising from or in
any way relating to any claim, demand, suit, action, or proceeding (including
any inquiry or investigation) by any person, including without limitation the
parties to this Agreement, whether threatened or initiated, asserting a claim
for any legal or equitable remedy against any person under any statute or
regulation, including, but not limited to, any federal or state securities laws,
or under any common law or equitable cause or otherwise, arising from or in
connection with the negotiation, preparation, execution, performance or failure
of performance of this Agreement or any transaction contemplated herein, whether
or not any such Indemnified Party is a party to any such action or proceeding,
suit or the target of any such inquiry or investigation; provided, however, that
no Indemnified Party shall have the right to be indemnified hereunder for
liability finally determined by a court of competent jurisdiction, subject to no
further appeal, to have resulted solely from the gross negligence or willful
misconduct of such Indemnified Party. If any such action or claim shall be
brought or asserted against any Indemnified Party, such Indemnified Party shall
promptly notify the Company and the Placement Agent hereunder in writing, and
the Placement Agents and the Company shall assume the defense thereof, including
the employment of counsel and the payment of all expenses. Such Indemnified
Party shall, in its sole discretion, have the right to employ separate counsel
(who may be selected by such Indemnified Party in its sole discretion) in any
such action and to participate and to participate in the defense thereof, and
the fees and expenses of such counsel shall be paid by such Indemnified Party,
except that the Placement Agents and/or the Company shall be required to pay
such fees and expense if (a) the Placement Agents or the Company agree to pay
such fees and expenses, or (b) the Placement Agents and/or the Company shall
fail to assume the defense of such action or proceeding or shall fail, in the
sole discretion of such Indemnified Party, to employ counsel satisfactory to the
Indemnified Party in any such action or proceeding, (c) the Placement Agents and
the Company is the plaintiff in any such action or proceeding or (d) the named
or potential parties to any such action or proceeding (including any potentially
impleaded parties) include both Indemnified Party the Company and/or the
Placement Agents Indemnified Party shall have been advised by counsel that there
may be one or more legal defenses available to it which are different from or
additional to those available to the Company or the Placement Agents. The
Placement Agents and the Company shall be jointly and severally liable to pay
fees and expenses of counsel pursuant to the preceding sentence, except that any
obligation to pay under clause (a) shall apply only to the party so agreeing.
All such fees

                                       6
<PAGE>

and expenses payable by the Company and/or the Placement Agents pursuant to the
foregoing sentence shall be paid from time to time as incurred, both in advance
of and after the final disposition of such action or claim. The obligations of
the parties under this section shall survive any termination of this Agreement,
and resignation or removal of the Escrow Agent shall be independent of any
obligation of Escrow Agent.

     The parties agree that neither payment by the Company or the Placement
Agents of any claim by Escrow Agent for indemnification hereunder shall impair,
limit, modify, or affect, as between the Placement Agents and the Company, the
respective rights and obligations of Placement Agents, on the one hand, and the
Company, on the other hand, under the Placement Agency Agreements.

13.      Warranties.
         ----------

         a. Placement Agents makes the following representations and warranties
to Escrow Agent:

                  (i) Placement Agents have full power and authority to execute
                  and deliver this Escrow Agreement and to perform its
                  obligations hereunder.

                  (ii) This Escrow Agreement has been duly approved by all
                  necessary corporate action of Placement Agents, including any
                  necessary shareholder approval, has been executed by duly
                  authorized officers of the Placement Agents, enforceable in
                  accordance with its terms.

                  (iii) The execution, delivery, and performance of the
                  Placement Agents of this Agreement will not violate, conflict
                  with, or cause a default under the certificate of
                  incorporation or bylaws of Placement Agents, any applicable
                  law or regulation, any court order or administrative ruling or
                  degree to which the Placement Agents is a party or any of its
                  property is subject, or any agreement, contract, indenture, or
                  other binding arrangement.

                  (iv) Michael Jacobs has been duly appointed to act as the
                  representative of The May Davis Group, Inc., hereunder and has
                  full power and authority to execute, deliver, and perform this
                  Escrow Agreement, to execute and deliver any Joint Written
                  Direction, to amend, modify, or waive any provision of this
                  Agreement, and to take any and all other actions as the
                  Placement Agent's representative under this Agreement, all
                  without further consent or direction form, or notice to, the
                  Placement Agent or any other party.

                                       7
<PAGE>

                  (v) No party other than the parties hereto and the Investors
                  have, or shall have, any lien, claim or security interest in
                  the Escrow Funds or any part thereof. No financing statement
                  under the Uniform Commercial Code is on file in any
                  jurisdiction claiming a security interest in or describing
                  (whether specifically or generally) the Escrow Funds or any
                  part thereof.

                  (vi) All of the representations and warranties of the
                  Placement Agents contained herein are true and complete as of
                  the date hereof and will be true and complete at the time of
                  any disbursement from the Escrow Funds.

         b. The Company makes the following representations and warranties to
Escrow Agent:

                  (i) The Company is a corporation duly organized, validly
                  existing, and in good standing under the laws of the State of
                  Florida, and has full power and authority to execute and
                  deliver this Escrow Agreement and to perform its obligations
                  hereunder.

                  (ii) This Escrow Agreement has been duly approved by all
                  necessary corporate action of the Company, including any
                  necessary shareholder approval, has been executed by duly
                  authorized officers of the Company, enforceable in accordance
                  with its terms.

                  (iii) The execution, delivery, and performance by the Company
                  of this Escrow Agreement is in accordance with the Credit
                  Agreement and will not violate, conflict with, or cause a
                  default under the certificate of incorporation or bylaws of
                  the Company, any applicable law or regulation, any court order
                  or administrative ruling or decree to which the Company is a
                  party or any of its property is subject, or any agreement,
                  contract, indenture, or other binding arrangement, including
                  without limitation to the Credit Agreement, to which the
                  Company is a party or any of its land is subject.

                  (iv) Walter V. Usinowicz, Jr. and Elliot Block each acting
                  individually, has been duly appointed to act as the
                  representatives of the Company hereunder and has full power
                  and authority to execute, deliver, and perform this Escrow
                  Agreement, to execute and deliver any Joint Written Direction,
                  to amend, modify or waive any provision of this Agreement and
                  to take all other actions as the Company's Representative
                  under this Agreement, all without

                                       8
<PAGE>

                  further consent or direction from, or notice to, the Company
                  or any other party.

                  (v) No party other than the parties hereto and the Investors
                  have, or shall have, any lien, claim or security interest in
                  the Escrow Funds or any part thereof. No financing statement
                  under the Uniform Commercial Code is on file in any
                  jurisdiction claiming a security interest in or describing
                  (whether specifically or generally) the Escrow Funds or any
                  part thereof.

                  (vi) All of the representations and warranties of the Company
                  contained herein are true and complete as of the date hereof
                  and will be true and complete at the time of any disbursement
                  from the Escrow Funds.

         14. Consent to Jurisdiction and Venue. In the event that any party
hereto commences a lawsuit or other proceeding relating to or arising from this
Agreement, the parties hereto agree that the United States District Court for
the District of New Jersey shall have the sole and exclusive jurisdiction over
any such proceeding. If all such courts lack federal subject matter
jurisdiction, the parties agree that the Superior Court Division of New Jersey,
Chancery Division of Essex County shall have sole and exclusive jurisdiction.
Any of these courts shall be proper venue for any such lawsuit or judicial
proceeding and the parties hereto waive any objection to such venue. The parties
hereto consent to and agree to submit to the jurisdiction of any of the courts
specified herein and agree to accept the service of process to vest personal
jurisdiction over them in any of these courts.

         15. Notice. All notices and other communications hereunder shall be in
writing and shall be deemed to have been validly served, given or delivered five
(5) days after deposit in the United States mails, by certified mail with return
receipt requested and postage prepaid, when delivered personally, one (1) day
delivered to any overnight courier, or when transmitted by facsimile
transmission and addressed to the party to be notified as follows:

                  If to Placement Agents, to:

                  The May Davis Group, Inc.
                  One World Trade Center
                  New York, NY 10048
                  Attention: Michael Jacobs
                  Facsimile: (212) 775-8166

                  With Copy to:

                  Butler Gonzalez, LLP
                  1000 Stuyvesant Avenue

                                       9
<PAGE>

                  Suite #6
                  Union, NJ  07083
                  Attention: David Gonzalez, Esq.
                  Facsimile: (908) 810-0973

                  If to Company, to:

                  TCPI, Inc.
                  3341 S.W. 15th Street
                  Pompano Beach, FL  33069
                  Attention: Chief Executive Officer
                  Telephone:  (954) 979-0400
                  Facsimile:  (954) 979-6125

                  With Copy to:

                  TCPI, Inc.
                  3341 S.W. 15th Street
                  Pompano Beach, FL  33069
                  Attention: General Counsel
                  Telephone:  (954) 979-0400
                  Facsimile:  (954) 979-6125

                            and

                  Teddy D. Klinghoffer, Esq.
                  Akerman, Senterfitt & Edison, P.A.
                  SunTrust International Center, 26th Floor
                  One S.E. 3rd Avenue
                  Telephone:  (305) 374-5600
                  Facsimile:  (305) 374-5095

                  If to Escrow Agent, to:

                  First Union National Bank,
                  407 Main Street
                  Metuchen, NJ 08840
                  Attention: Robert Mercado
                             Carmela Agugliaro
                  Facsimile: (732) 452-3005

         Or to such other address as each party may designate for itself by like
notice.

                                       10
<PAGE>

         16. Amendments or Waiver. This Agreement may be changed, waived,
discharged or terminated only by a writing signed by the parties and the Escrow
Agent. No delay or omission by any party in exercising any right with respect
hereto shall operate as waiver. A waiver on any one occasion shall not be
construed as a bar to, or waiver of, any right or remedy on any future occasion.

         17. Severability. To the extent any provision of this Agreement is
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition, or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.

         18. Governing Law. This Agreement shall be construed and interpreted in
accordance with the internal laws of the State of New Jersey without giving
effect to the conflict of laws principles thereof.

         19. Entire Agreement. This Agreement constitutes the entire Agreement
between the parties relating to the holding, investment, and disbursement of the
Escrow Funds and sets forth in their entirety the obligations and duties of the
Escrow Agent with respect to the Escrow Funds.

         20. Binding Effect. All of the terms of this Agreement, as amended from
time to time, shall be binding upon, inure to the benefit of and be enforceable
by the respective heirs, successors and assigns of the Placement Agent, the
Company, or the Escrow Agent.

         21. Execution of Counterparts. This Agreement and any Joint Written
Direction may be executed in counter parts, which when so executed shall
constitute one and same agreement or direction.

         22. Termination. Upon the first to occur of the disbursement of all
amounts in the Escrow Funds pursuant to Joint Written Directions or the
disbursement of all amounts in the Escrow Funds into court pursuant to Section 7
hereof, this Agreement shall terminate and Escrow Agent shall have no further
obligation or liability whatsoever with respect to this Agreement or the Escrow
Funds.

         23. Line of Credit Agreement. Nothing contained in this Agreement shall
effect the rights and obligations of the parties to the Line of Credit
Agreement.

                             NO FURTHER TEXT FOLLOWS
                       THE SIGNATURE PAGE IS THE NEXT PAGE

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<PAGE>

         IN WITNESS WHEREOF the parties have hereunto set their hands and seals
the day and year above set forth.

ATTEST:                                        COMPANY:
                                               TCPI, INC.

/s/ Jay E. Eckhaus                          By: /s/ Walter V. Usinowicz, Jr.
--------------------                            ----------------------------
Name: Jay E. Eckhaus                        Name: Walter V. Usinowicz, Jr.
Title: Secretary                            Title: Chief Financial Officer

                                            ESCROW AGENT:
                                            FIRST UNION NATIONAL BANK

                                            By: /s/ Robert Mercado
                                                ----------------------------
                                            Name: Robert Mercado
                                            Title: As Escrow Agent

                                            PLACEMENT AGENT:
                                            THE MAY DAVIS GROUP, INC.

                                            By: /s/ Michael Jacobs
                                                ----------------------------
                                            Name: Michael Jacobs
                                            Title: Managing Director

                                       12CERTIFICATE OF DETERMINATION OF PREFERENCES

                                       OF

                SERIES D CONVERTIBLE PAY-IN-KIND PREFERRED STOCK,

                                       OF

                              THE RIGHT START, INC.

                     (Pursuant to Section 401 of the General

                   Corporation Law of the State of California)

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

                  The  undersigned,  Jerry R.  Welch and  Raymond  P.  Springer,
hereby certify that (1) they are the President and Chief Executive Officer,  and
the Chief  Financial  Officer and Secretary,  respectively,  of The Right Start,
Inc., a California  corporation  (the  "Corporation"),  and (2) under  authority
given by the Corporation's Second Amended and Restated Articles of Incorporation
(the "Restated  Articles"),  the Board of Directors of the  Corporation has duly
adopted the following recitals and resolutions:

                  WHEREAS,  the Restated  Articles provide for a class of shares
known as "Preferred Stock," issuable from time to time in one or more series;

                  WHEREAS,   the  Board  of  Directors  of  the  Corporation  is
authorized to determine the rights,  preferences,  privileges,  and restrictions
granted to or imposed on any wholly unissued  series of Preferred  Stock, to fix
the  number  of  shares  constituting  any such  series,  and to  determine  the
designation thereof, or any of them;

                  WHEREAS, the Restated Articles provide that the Corporation is
authorized to issue Two Hundred and Fifty Thousand (250,000) shares of Preferred
Stock;

                  WHEREAS, the Corporation has issued 98,500 shares of Preferred
Stock and the Board of Directors  of the  Corporation  desires to determine  the
rights, preferences, privileges, and restrictions relating to one (1) additional
series  of  Preferred  Stock  and the  number  of  shares  constituting  and the
designation of such series;

                  WHEREAS,  the  Board  of  Directors  of  the  Corporation  has
determined  that eighty  thousand  (80,000)  shares of Preferred  Stock shall be
designated as Series D Convertible Pay-in-Kind Preferred Stock;

                  NOW, THEREFORE,  BE IT RESOLVED,  that pursuant to Article III
of  the  Restated   Articles,   the  Board  of  Directors   hereby  creates  the
Corporation's  Series D Convertible  Pay-in-Kind  Preferred Stock and determines
the designation of, number of shares constituting,  and the rights, preferences,
privileges,  and restrictions  relating to the Series D Convertible  Pay-in-Kind
Preferred Stock as follows:

                                        1
<PAGE>

          I.  Designation  and  Amount.  The number of shares  constituting  the
     Series D Convertible  Pay-in-Kind Preferred Stock, par value $.01 per share
     (the "Series D Preferred Stock"), shall be eighty thousand (80,000) shares.

          II. Dividends and Distributions.

              A.  Dividends.  The holders of Series D  Preferred  Stock shall be
              entitled  to  receive,  when,  as and if  declared by the Board of
              Directors  of the  Corporation,  out of funds  of the  Corporation
              legally  available  therefor,  on any shares of Series D Preferred
              Stock  that  have not  been  converted  pursuant  to  Section  IV,
              dividends,  at the rate of eight  dollars  ($8.00)  per  share per
              annum,  or 8% per  annum  of  the  liquidation  preference  of one
              hundred  dollars  ($100.00)  per share,  on the Series D Preferred
              Stock,  which  dividends  shall be  cumulative,  shall accrue on a
              daily basis without interest from the date of issuance,  and shall
              be  payable  in  cash or in  kind,  at the  Corporation's  option,
              quarterly in arrears on December 1 and June 1 of each year (each a
              "Series D Payment Date"), commencing December 1, 2000 (except that
              if any such date is not a Business Day,  then such dividend  shall
              be payable on the next  succeeding  day that is a Business Day) to
              the holders of record as they appear on the stock  transfer  books
              of the  Corporation  on such  record  dates  as are  fixed  by the
              Corporation's Board of Directors not more than 60 nor less than 10
              days preceding the Series D Payment Dates for such dividends.  The
              accumulation  and accrual of  dividends  on the Series D Preferred
              Stock after December 1, 2000, shall occur regardless of whether or
              not the  Corporation  shall have funds  legally  available for the
              payment of dividends. The amount of dividends payable per share of
              Series D Preferred  Stock for the initial  dividend period and any
              period  shorter  than a full  quarterly  dividend  period shall be
              computed  on the  basis of a 360 day  year  consisting  of  twelve
              30-day months.  On each Series D Payment Date the  Corporation may
              pay,  at its  option  and in its sole  discretion,  in lieu of the
              payment  of  dividends  in cash on the Series D  Preferred  Stock,
              dividends on all outstanding shares of Series D Preferred Stock in
              whole,  or in part,  through the issuance of additional  shares of
              Series D  Preferred  Stock  ("PIK  Shares"),  having an  aggregate
              liquidation  preference equal to the amount of such dividends.  On
              each such Series D Payment Date that the Company elects to deliver
              PIK Shares,  the Company shall issue and deliver PIK Shares to the
              holders of Series D  Preferred  Stock  entitled  to such  dividend
              payments.  The  issuance  of  such  PIK  Shares  shall  constitute
              "payment"  of the  related  dividend  for  all  purposes  of  this
              Certificate of Designation.

              In no event,  so long as any Series D Preferred Stock shall remain
              outstanding, shall (i) any dividend whatsoever be declared or paid
              upon, nor shall any  distribution  be made upon, any Common Stock,
              or any other capital stock of the Corporation ranking junior as to
              the payment of dividends  ("Junior Dividend Stock"),  other than a
              dividend  or  distribution  payable  in shares of Common  Stock or
              Junior  Dividend  Stock,  unless and until all  accrued and unpaid
              dividends  on the Series D  Preferred  Stock,  including  the full
              dividend  for the then  current  period,  shall  have been paid or
              declared and set apart for  payment,  (ii) (A) except as set forth
              in clause (B)  following,  any dividend  whatsoever be declared or
              paid upon,  nor shall any  distribution  be made upon,  any of the
              Corporation's Series A Mandatorily Redeemable Preferred Stock, par
              value  $.01 per  share  (the  "Series  A  Preferred  Stock"),  the
              Corporation's Series B Convertible Preferred Stock, par value $.01
              per share (the "Series B Preferred  Stock") and the  Corporation's
              Series C  Convertible  Preferred  Stock,  par value $.01 per share
              (the "Series C Preferred  Stock," and,  together with the Series A
              Preferred  Stock , the  Series C  Preferred  Stock  and any  other
              capital stock of the Corporation ranking on a parity as to the

                                        2
<PAGE>

              payment of dividends, the "Parity Dividend Stock"), for any period
              unless   and   until   cumulative    dividends   have   been,   or
              contemporaneously  are,  paid or  declared  and set apart for such
              payment of the Series D Preferred  Stock and such Parity  Dividend
              Stock for all dividend periods terminating on or prior to the date
              of  payment  of  such  full  cumulative  dividends  and  (B)  when
              dividends  are not paid in full upon the Series D Preferred  Stock
              and the Parity Dividend Stock,  all dividends paid or declared and
              set aside for  payment  upon  shares of Series D  Preferred  Stock
              shall be paid or  declared  and set aside for  payment pro rata so
              that the amount of  dividends  paid or declared  and set aside for
              payment per share on the Series D  Preferred  Stock and the Parity
              Dividend  Stock  shall in all  cases  bear to each  other the same
              ratio that accrued and unpaid dividends per share on the shares of
              Series D  Preferred  Stock and Parity  Dividend  Stock bear to one
              another,  (iii) without the written  consent of the holders of not
              less than 50% of the  outstanding  shares  of  Series D  Preferred
              Stock, any shares of Common Stock, Junior Dividend Stock or Parity
              Dividend  Stock be purchased or redeemed by the  Corporation,  nor
              (iv) any moneys be paid to or made  available  for a sinking  fund
              for  the  purchase  or  redemption  of any  Common  Stock,  Junior
              Dividend Stock or Parity Preferred Stock.

              Dividends  shall be payable to the holders of record on the record
              date established by the Board of Directors of the Corporation (the
              "Record Date"),  which date shall be no less than 10 days prior to
              each Series D Payment Date.

              B.  Liquidation  Preference.  In the  event  of  any  liquidation,
              dissolution or winding up of the Corporation, whether voluntary or
              involuntary,  the  holders of Series D  Preferred  Stock  shall be
              entitled to receive with respect to each share,  out of the assets
              of the  Corporation,  whether  such  assets are stated  capital or
              surplus of any nature,  an amount equal to the  dividends  accrued
              and  unpaid  thereon  to the  date of final  distribution  to such
              holders,  whether or not declared, plus a sum equal to One Hundred
              Dollars  ($100.00) per share (the "Series D Preferred  Liquidation
              Preference"), and no more, before any payment shall be made or any
              assets distributed to holders of Common Stock or any other capital
              stock of the  Corporation  ranking  junior as to the payment  upon
              liquidation,   dissolution   or  winding  up  including,   without
              limitation,  all series of Preferred Stock hereafter issued by the
              Corporation  (unless  such  later  issued  series has parity or is
              senior in  priority,  and has been  permitted  under  Section III)
              (collectively,  "Junior  Liquidation  Stock")  and,  after June 1,
              2002, after all liquidation  preference  payments to which holders
              of the Series A Preferred Stock are entitled shall have been made.
              The Series D Preferred  Stock shall be senior as to liquidation to
              the Common Stock and all Junior  Liquidation Stock and, after June
              1, 2002,  junior to the Series A Preferred Stock. In the event the
              assets  of  the   Corporation   available  for   distribution   to
              shareholders  upon any  liquidation,  dissolution or winding up of
              the  Corporation,  whether  voluntary  or  involuntary,  shall  be
              insufficient  to pay in full the amounts  payable  with respect to
              the Series D Preferred  Stock and any other class or series of the
              Corporation's capital stock which has or may hereafter have parity
              as to  liquidation  rights  with  the  Series  D  Preferred  Stock
              (including,  the Series A Preferred  Stock  (prior to June 1, 2002
              only),  the Series B  Preferred  Stock and the Series C  Preferred
              Stock, the "Parity Liquidation  Stock"), the holders of the Series
              D Preferred Stock and the holders of the Parity  Liquidation Stock
              shall  share  ratably  in  any   distribution  of  assets  of  the
              Corporation  in  proportion  to the full  respective  preferential
              amounts to which they are entitled (but only to the extent of such
              preferential  amounts).  After payment in full of the  liquidation
              preferences of the Series D Preferred  Stock,  the holders of such
              shares shall not be entitled to any further participation in any

                                        3
<PAGE>

              distribution  of  assets  by the  Corporation.  Neither  a merger,
              consolidation,  or other business  combination of the  Corporation
              with or into  another  corporation  or other  entity nor a sale or
              transfer  of all or part of the  Corporation's  assets  for  cash,
              securities or other  property  shall be considered a  liquidation,
              dissolution or winding up of the  Corporation for purposes of this
              Section II.B.  (unless in connection  therewith the liquidation of
              the  Corporation is specifically  approved by the  shareholders of
              the  Corporation).  The holder of any shares of Series D Preferred
              Stock shall not be  entitled to receive any payment  owed for such
              shares under this Section  II.B.  until such holder shall cause to
              be delivered to the  Corporation (i)  certificate(s)  representing
              such  shares  of  Series  D  Preferred  Stock  and  (ii)  transfer
              instruments  satisfactory  to the  Corporation  and  sufficient to
              transfer  such  shares  to the  Corporation  free and clear of any
              adverse interest.

          III.Voting  Rights.  So long as any Series D Preferred  Stock shall be
     outstanding, consent of the holders of at least a majority of the shares of
     Series D Preferred  Stock  (unless the consent of a greater  percentage  is
     required by applicable law or the  Corporation's  articles of incorporation
     as then in effect), voting together as a single class, will be required for
     (a) each amendment of the  Corporation's  articles of incorporation as then
     in  effect  which  adversely  affects  the  relative  rights,  preferences,
     qualifications,  limitations  or  restrictions  of the  Series D  Preferred
     Stock, (b) any action that, except as contemplated herein,  creates any new
     class or series of shares having  preference over or being on a parity with
     the Series D Preferred  Stock in respect of the payment of dividends,  upon
     liquidation,  dissolution  or  winding  up of the  Corporation,  or (c) any
     reclassification  of the Series D Preferred Stock.  Except for such consent
     rights and such  voting  rights as may be  provided  by  applicable  law or
     herein,  the Series D  Preferred  Stock  shall  have no voting  rights as a
     separate  series  except the right to vote as a separate  series within the
     class of preferred  stock as to any matters  regarding the  modification of
     the  rights,  privileges  or terms of the  Series D  Preferred  Stock.  Any
     required  vote of the  Series D  Preferred  as a  separate  series  will be
     accomplished  by the vote of a  majority  of the shares of such  series.  A
     class vote on the part of the Series D Preferred Stock  specifically  shall
     not be required  (except as otherwise  required by law or resolution of the
     Corporation's   Board  of   Directors)   in   connection   with:   (a)  the
     authorization,  issuance or increase in the authorized amount of any shares
     of any other  class or series of stock  that  ranks  junior to the Series D
     Preferred Stock in respect of the payment of dividends,  upon  liquidation,
     dissolution  or winding up of the  Corporation;  or (b) the  authorization,
     issuance  or  increase  in the  amount  of  any  notes,  bonds,  mortgages,
     debentures or other  obligations of the Corporation not convertible into or
     exchangeable, directly or indirectly, for stock ranking prior to the Series
     D Preferred Stock in respect of the payment of dividends, upon liquidation,
     dissolution or winding up of the Corporation.

     IV. Conversion

          A. Voluntary Conversion.

               (i) Right to Convert. Any time, and from time to time, each share
               of Series D Preferred  Stock  shall,  at the option of the holder
               thereof,  be  convertible  into  that  number  of fully  paid and
               non-assessable  shares of  Common  Stock  (calculated  as to each
               conversion  to  the  nearest  1/100th  of a  share)  obtained  by
               dividing  the Series D Preferred  Liquidation  Preference  by two
               dollars ($2.00), as adjusted from time to time as provided herein
               (the "Conversion  Rate") and by surrender of such share of Series
               D Preferred  Stock so to be converted  in the manner  provided in
               Section  IV.A.(ii).  The Conversion  Rate shall  initially be two
               dollars  ($2.00) per share of Common Stock  delivered in exchange
               for  Series D  Preferred  Stock as set  forth  above and shall be
               subject to adjustment and  readjustment  from time to time as set
               forth in Section IV.D.

                                        4
<PAGE>

               (ii) Mechanics of Conversion. In order to exercise the conversion
               privilege, the holder of one or more shares of Series D Preferred
               Stock  to  be  converted  shall  surrender  such  shares  to  the
               Secretary  of  the  Corporation  at the  Corporation's  principal
               offices,  accompanied  by the  funds,  if  any,  required  to pay
               transfer  or similar  taxes and shall give  written  notice  (the
               "Conversion  Notice") to the Corporation  that such holder elects
               to convert all or a  specified  number of such shares and stating
               in such Conversion  Notice,  his name or the name or names of his
               nominees in which he wishes the certificate or  certificates  for
               Common Stock to be issued, together with instruments of transfer,
               in form  satisfactory  to the  Corporation,  duly executed by the
               holder  or  his  duly   authorized   attorney.   As  promptly  as
               practicable  after  the  surrender  of such  shares  of  Series D
               Preferred  Stock  and  the  receipt  of  the  Conversion  Notice,
               instruments  of transfer and funds to pay any transfer or similar
               tax,  if any,  as  aforesaid,  the  Corporation  shall  issue and
               deliver at such  offices to such  holder of Series D  Convertible
               Preferred Stock, or to his nominee or nominees,  a certificate or
               certificates  representing  the number of shares of Common  Stock
               and a check or cash with respect to any fractional  interest in a
               share of Common  Stock to which he shall be entitled as aforesaid
               in accordance with Section IV.C and, if less than the full number
               of  shares  of  Series  D  Preferred   Stock  evidenced  by  such
               surrendered  certificate or certificates are being  converted,  a
               new certificate or certificates, of like tenor, for the number of
               shares of Series D Preferred Stock evidenced by such  surrendered
               certificate  less the number of such shares of Series D Preferred
               Stock being  converted.  Any conversion made at the election of a
               holder of Series D  Preferred  Stock shall be deemed to have been
               made  immediately  prior to the close of  business on the date of
               such surrender of such shares to be converted,  and the person or
               persons  entitled  to receive  the  Common  Stock  issuable  upon
               conversion shall be treated for all purposes as the record holder
               or holders of such Common Stock on such date.

          B. Forced Conversion.

               (i) Change of  Control.  The Series D  Preferred  Stock  shall be
               convertible in full by the  Corporation  at the  Conversion  Rate
               upon the occurrence of a Change of Control.  For purposes of this
               Certificate  of  Determination,  "Change  of  Control"  shall  be
               defined as:

                    a.   any merger or  consolidation  of the Corporation  where
                         the  Corporation  is not the  surviving  entity or as a
                         result of which Kayne Anderson and its Affiliates cease
                         to beneficially own (as beneficial ownership is defined
                         in  Rule  13d-3  of  the  Exchange  Act)  and  control,
                         directly  or  indirectly,  at least  twenty-five  (25%)
                         percent of the issued and outstanding shares of capital
                         stock of the  Corporation  entitled  (without regard to

                                        5
<PAGE>

                         the  occurrence  of any  contingency)  to vote  for the
                         election  of a majority  of the members of the Board of
                         Directors of the Corporation; or

                    b.   any sale or transfer of all or substantially all of the
                         Corporation's assets or stock.

               (ii) Trading  Price Level.  On or after  October 6, 2001,  if the
               Closing  Price per  share of the  Corporation's  Common  Stock is
               three dollars $3.00 or greater for 20  consecutive  trading days,
               the Corporation  may, within 15 business days following such 20th
               consecutive  trading day,  convert any or all of the  outstanding
               shares  of  Series  D   Preferred   Stock  into  fully  paid  and
               nonassessable  shares of Common Stock at the Conversion Rate. For
               purposes of this Certificate of Determination,  the term "Closing
               Price" on any day shall  mean the last  reported  sales  price on
               such day or, in case no such sale  takes  place on such day,  the
               average of the reported closing high and low quotations,  in each
               case on the New York Stock  Exchange  or, if the Common  Stock is
               not  listed  on the New York  Stock  Exchange,  on the  principal
               national  securities  market  or  quotation  system  on which the
               Common Stock is then traded or quoted, or, if the Common Stock is
               then not so traded or quoted, on the Nasdaq National Market,  or,
               if the Common Stock is not listed on the Nasdaq National  Market,
               the  average  of the high  bid and  low-asked  quotations  of the
               Common  Stock  in  the  over-the-counter  market  on  the  day in
               question   as   reported  by  the   National   Quotation   Bureau
               Incorporated,   or  a  similarly   generally  accepted  reporting
               service, or, if no such quotations are available, the fair market
               value of the  Common  Stock as  determined  by any New York Stock
               Exchange  member firm  selected from time to time by the Board of
               Directors for such purpose.

               (iii) Mechanics of Conversion. Notice of any forced conversion of
               the  Series  D  Preferred  Stock  ("Forced   Conversion  Notice")
               specifying  the time of conversion,  the Conversion  Rate and the
               fact of the  occurrence  of a Change of  Control  or the  Closing
               Price history of the  Corporation's  Common Stock, as applicable,
               and the paragraph  pursuant to which such conversion is required,
               shall be mailed by certified or registered  mail,  return receipt
               requested,   at  the  address  for  such  holder   shown  on  the
               Corporation's  records not more than one hundred twenty (120) nor
               less  than  thirty  (30)  days  prior to the  date on which  such
               conversion is to be made,  with respect to the Series D Preferred
               Stock. Upon mailing any Forced Conversion Notice, the Corporation
               shall issue and deliver at its  principal  offices to such holder
               of Series D Preferred  Stock,  or to his nominee or  nominees,  a
               certificate or certificates  representing the number of shares of
               Common Stock and a check or cash with  respect to any  fractional
               interest in a share of Common Stock to which he shall be entitled
               as aforesaid in accordance  with the Section IV.C. Any conversion
               made at the election of the  Corporation  shall be deemed to have
               been made immediately  prior to the close of business on the date
               of such  mailing,  and the person or persons  entitled to receive
               the Common Stock  issuable upon  conversion  shall be treated for
               all purposes as the record holder or holders of such Common Stock

                                        6
<PAGE>

               on such  date.  On the  date of such  mailing,  the  certificates
               representing  the Series D Preferred Stock shall be null and void
               and shall no longer  represent an interest in the Corporation and
               dividends  shall cease to accrue thereon.  Any Forced  Conversion
               Notice that is mailed as provided in this subsection  (iii) shall
               be conclusively  presumed to have been duly given, whether or not
               the holder of the Series D Preferred  Stock receives such notice;
               and  failure  to give such  notice or any  defect in such  notice
               shall not affect the validity of the  proceedings  for the forced
               conversion of Series D Preferred Stock.

          C.  Fractional  Shares.  No  fractional  shares or scrip  representing
     fractions of shares of Common Stock shall be issued upon  conversion of the
     Series D  Preferred  Stock.  If more than one  share of Series D  Preferred
     Stock shall be  surrendered  for conversion at one time by the same holder,
     the number of full shares of Common Stock issuable upon conversion  thereof
     shall be  computed  using the  product  of One  Hundred  Dollars  ($100.00)
     multiplied  by each such share so  surrendered.  In lieu of any  fractional
     interest in a share of Common Stock which would  otherwise  be  deliverable
     upon the  conversion  of any  shares  of  Series  D  Preferred  Stock,  the
     Corporation  shall  pay to the  holder  of such  shares  an  amount in cash
     (computed  to the nearest  cent)  equal to the closing  price of the Common
     Stock (as  reported on the national  exchange or quotation  system on which
     the Common Stock is then traded; or, if the Common Stock is not then traded
     on such an exchange or system,  as determined in good faith by the Board of
     Directors of the Corporation) on the Business Day next preceding the day of
     conversion, multiplied by the fractional interest that otherwise would have
     been deliverable upon conversion of such shares.

          D. Adjustments to Conversion Rate:

               1. Stock Dividends, Subdivisions and Combinations. In case at any
          time or from time to time after the Preferred  Stock Issuance Date the
          Corporation  shall,  subject to the  restrictions set forth in Section
          IV.D.:

               (i) pay a dividend or make a distribution  on its Common Stock in
               shares of Common Stock,

               (ii)  subdivide  its  outstanding  shares of Common  Stock into a
               greater number of shares, or

               (iii)  combine  its  outstanding  shares of Common  Stock  into a
               smaller number of shares,

               then in each such case the Conversion Rate in effect  immediately
               prior to such action  shall be adjusted so that the holder of any
               share of Series D  Preferred  Stock  thereafter  surrendered  for
               conversion  shall be  entitled to receive the number of shares of
               Common Stock or other capital stock of the  Corporation  which he
               would  have  owned  or  been  entitled  to  receive   immediately
               following such action had such share been  converted  immediately
               prior  to the  occurrence  of  such  event.  An  adjustment  made
               pursuant to this subsection  shall become  effective  immediately
               after the record date, in the case of a dividend or distribution,
               or  immediately  after  the  effective  date,  in the  case  of a
               subdivision or combination.

                                        7
<PAGE>

               E.  No  impairment.   The   Corporation   will  not  through  any
          reorganization,    transfer   of   assets,   consolidation,    merger,
          dissolution,  issue  or  sale of  securities  or any  other  voluntary
          action,  avoid the observance or performance of any of the terms to be
          observed or  performed  hereunder by the  Corporation  but will at all
          times in good faith assist in the  carrying out of all the  provisions
          of this  Section  IV and in the  taking  of all such  action as may be
          necessary or appropriate in order to protect the conversion  rights of
          the holders of shares of Series D Preferred Stock against  impairment.
          Without limiting the generality of the foregoing,  the Corporation (i)
          will take all such action as may be necessary or  appropriate in order
          that  the  Corporation  may  validly  and  legally  issue  fully  paid
          nonassessable  shares  of  stock  on the  conversion  of the  Series D
          Preferred  Stock,  and (ii) will not take any action which  results in
          any adjustment of the Conversion Rate if the total number of shares of
          Common Stock  issuable  after the action upon the conversion of all of
          the shares of Series D Preferred Stock will exceed the total number of
          shares of Common Stock then  authorized  by the Restated  Articles and
          available for the purpose of issue upon such conversion.

               F.  Certificate  as to  Adjustments.  Upon the occurrence of each
          adjustment or  readjustment  of the  Conversion  Rate pursuant to this
          Section IV, the Corporation  shall promptly compute such adjustment or
          readjustment  in accordance  with the terms hereof and furnish to each
          holder of shares of Series D  Preferred  Stock a  certificate  setting
          forth such adjustment or readjustment  and showing in detail the facts
          upon which such  adjustment  or  readjustment  is based,  including  a
          statement of (i) the number of shares of Common Stock then outstanding
          or deemed to be  outstanding,  and (ii) the Conversion  Rate in effect
          immediately prior to such issue or sale and as adjusted and readjusted
          on account  thereof,  showing how such Conversion Rate was calculated.
          The  Corporation  shall,  as promptly  as  practicable  following  its
          receipt  of the  written  request  of any holder of shares of Series D
          Preferred  Stock,  furnish or cause to be  furnished  to such holder a
          like certificate  setting forth (i) the Conversion Rate at the time in
          effect, showing how it was calculated and (ii) the number of shares of
          Common Stock which at the time would be received  upon the  conversion
          of the Series D Preferred Stock.

               G.  Notices  of Record  Date.  In the event of any  taking by the
          Corporation  of a record of the holders of any class of securities for
          the purpose of  determining  the holders  thereof who are  entitled to
          receive any dividend  (other than a cash dividend which is the same as
          cash dividends paid in previous  quarters) or other  distribution,  or
          any right to subscribe for,  purchase or otherwise  acquire any shares
          of stock of any  class or any  other  securities  or  property,  or to
          receive any other right, the Corporation  shall mail to each holder of
          Series D Preferred Stock at least ten days prior to the date specified
          therein,  a notice  specifying the date on which any such record is to
          be taken for the purpose of such dividend or distribution.

          V.  Miscellaneous.  This  Certificate of  Determination  shall also be
     governed by the following:

               A. Amendment and Waiver. This Certificate of Determination may be
          amended or otherwise  altered in accordance  with  applicable  law and
          Section III. No  amendment,  modification  or waiver of any  provision
          hereof shall extend to or affect any obligation not expressly amended,
          modified or waived or impair any right consequent  thereon.  No course
          of  dealing,  and no failure to exercise  or delay in  exercising  any
          right, remedy, power or privilege hereunder, shall operate as a

                                        8
<PAGE>

          waiver, amendment or modification of any provision of this Certificate
          of Determination.

               B.  Reacquired  Shares.  Any shares of Series D  Preferred  Stock
          purchased  or  otherwise  acquired  by the  Corporation  in any manner
          whatsoever   shall  be  retired  and  cancelled   promptly  after  the
          acquisition  thereof.  All such shares shall, upon their cancellation,
          become  authorized  but  unissued  shares  of  Preferred  Stock of the
          Corporation, undesignated as to series.

               C.  Registration.  The  Corporation  shall keep at its  principal
          office (or such other place as the Corporation  reasonably designates)
          a register for the registration of Series D Preferred Stock.  Upon the
          surrender of any certificate  representing Series D Preferred Stock at
          such place,  the  Corporation  shall, at the request of the registered
          holder of such  certificate,  execute and deliver a new certificate or
          certificates  in exchange  therefor  representing in the aggregate the
          number  of  shares  of Series D  Preferred  Stock  represented  by the
          surrendered  certificate  (and the Corporation  forthwith shall cancel
          such  surrendered   certificate),   subject  to  the  requirements  of
          applicable securities laws and any other applicable restrictions. Each
          such  new  certificate  shall be  registered  in such  name and  shall
          represent  such number of shares of Series D Preferred  Stock as shall
          be requested by the holder of the surrendered certificate and shall be
          substantially identical in form to the surrendered certificate.

               D. Replacement.  Upon receipt of evidence reasonably satisfactory
          to the  Corporation  (an  affidavit  and  indemnity of the  registered
          holder, including a bond if so requested by the Corporation,  shall be
          satisfactory)  of the ownership and the loss,  theft,  destruction  or
          mutilation of any certificate  evidencing one or more shares of Common
          Stock,  Series D Preferred  Stock and,  in the case of loss,  theft or
          destruction,  upon receipt of indemnity reasonably satisfactory to the
          Corporation  (provided  that if the  registered  holder is a financial
          institution,  its own agreement of indemnity  shall be  satisfactory),
          or, in the case of mutilation, upon surrender of such certificate, the
          Corporation shall (at its expense) execute and deliver in lieu of such
          certificate a new certificate of like kind  representing the number of
          shares of Common Stock or Series D Preferred Stock represented by such
          lost, stolen, destroyed or mutilated certificate and dated the date of
          such lost, stolen, destroyed or mutilated certificate.

               E.  Definitions.  The  following  terms shall have the  following
          meanings,  which meanings shall be equally  applicable to the singular
          and plural forms of such terms:

               "Affiliate"   of  a  Person  means  a  Person  that  directly  or
          indirectly  controls,  or is controlled by, or is under common control
          with such Person. The term "control" means the possession, directly or
          indirectly,  of the  power to direct  or cause  the  direction  of the
          management and policies of a Person,  whether through the ownership of
          voting securities, by contract or otherwise.

               "Business  Day" means any day which is not a Saturday or a Sunday
          or a public  holiday or a day on which banks are required or permitted
          to close under the laws of the State of California.

               "Common Stock" means the Common Stock of the Corporation  without
          par value.

                                        9
<PAGE>

               "Conversion  Rate"  shall have the  meaning  set forth in Section
          IV.A.1.

               "Exchange  Act" means the  Securities  Exchange  Act of 1934,  as
          amended,  and any similar or successor federal statute,  and the rules
          and regulations of the Commission promulgated  thereunder,  all as the
          same shall be in effect at any applicable time.

               "Person"  shall include an individual,  a corporation,  a limited
          liability company, an association,  a partnership, a limited liability
          partnership,  a  trust  or  estate,  a  government  or any  agency  or
          political subdivision thereof, or any other entity.

               "Preferred  Stock  Issuance  Date"  means  the date on which  the
          Corporation first issues any shares of Series D Preferred Stock.

               F.  Preemptive  Rights.  The  Series  D  Preferred  Stock  is not
          entitled to any  preemptive or  subscription  rights in respect of any
          securities of the Corporation.

          VI. Notices.  All notices  provided  hereunder shall be in writing and
     shall be delivered by courier,  messenger,  registered  or certified  mail,
     return  receipt  requested,   postage  prepaid  or  by  facsimile,  receipt
     confirmed  by sender  and will be deemed to have been  given when so mailed
     (or receipt  confirmed in the case of a facsimile) (i) to the  Corporation,
     at its  principal  executive  offices  and (ii) to the holder of  Preferred
     Stock,  at such holder's  address as it appears in the stock records of the
     Corporation (unless otherwise indicated by any such holder in notice to the
     Corporation conforming with this Section VI).

          VII. Common Stock Reserved. The Corporation shall at all times reserve
     and keep  available out of its  authorized  but unissued  Common Stock such
     number of shares of Common  Stock as shall from time to time be  sufficient
     to effect conversion of the Series D Preferred Stock.

     The  undersigned,  Jerry R. Welch and Raymond P. Springer,  further certify
that (i) the  number of shares of  Series D  Convertible  Pay-in-Kind  Preferred
Stock is 80,000  shares,  none of which  shares  have been  issued  and (ii) the
holders of a  majority  of the  Corporation's  Series A  mandatorily  redeemable
Preferred Stock, par value $.01 per share, Series B Convertible Preferred Stock,
par value $.01 per share and Series C  Convertible  Preferred  Stock,  par value
$.01 per share,  voting  together  as a class have  approved  the  creation  and
issuance of the Series D Preferred Stock.

                                       10
<PAGE>

     The  undersigned  declares  under  penalty of perjury under the laws of the
State of California that the matters set forth in this  certificate are true and
correct of his or her own knowledge.

Date:    October 4, 2000                   /s/ Jerry R. Welch
                                           Jerry R. Welch
                                           President and Chief Executive Officer

Date:    October 4, 2000                   /s/ Raymond P. Springer
                                           Raymond P. Springer
                                           Secretary and Chief Financial Officer

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