Document:

LOAN AND SECURITY AGREEMENT

THIS LOAN AND SECURITY AGREEMENT ("Agreement") as of December 31, 2000, is by
between and among Silvano DiGenova, 32001 Pacific Coast Highway, Laguna Beach,
California 92651 ("Lender") and TANGIBLE ASSET GALLERIES, INC., a Nevada
corporation (the "Borrower"), located at 3444 Via Lido, Newport Beach,
California 92663 ("Borrower's Address").

                                   WITNESSETH:

     WHEREAS, Borrower desires to borrow the aggregate principal sum of Nine
Hundred Fifty Nine Thousand Four Hundred Forty Dollars ($959,440.00) (the "Loan
Amount") from Lender; and

     WHEREAS, Borrower has executed that certain Promissory Note on the even
date herewith in the aggregate amount equal to the Loan Amount in favor of the
Lender (the "Note"); and

     WHEREAS, Lender is willing to lend to Borrower the Loan Amount under the
terms, provisions and conditions hereinafter set forth;

     NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Borrower and Lender hereby mutually covenant and agree as follows:

1.     DEFINITIONS. In addition to the terms defined elsewhere in this Agreement
or in any Exhibit or Schedule hereto, when used in this Agreement, the following
terms shall have the following meanings (such meanings shall be equally
applicable to the singular and plural forms of the terms used, as the context
requires):
     "Borrower's Obligations" or "Obligation" shall mean any and all present and
future indebtedness (principal, interest, fees, collection costs and expenses,
attorneys' fees and other amounts), liabilities and obligations (including,
without limitation, indemnity obligations) of Borrower to the Lender evidenced
by or arising under or in respect of this Agreement, the Note and/or any of the
other documents related thereto (such other documents referred to as the
"Transaction Documents").
     "Business Day" shall mean any day except a Saturday, Sunday or legal
holiday observed by banks in the State of California.
     "Default" shall mean any event or condition the occurrence of which would,
with the lapse of time or the giving of notice or both, become an Event of
Default.
"Event of Default" shall have the meaning ascribed thereto in Section 6.
"GAAP" shall mean, at any time, generally accepted accounting principles at such
time in the United States.
 "Material Adverse Effect" shall mean (a) a material adverse effect on the
properties, assets, liabilities, business, operations, prospects, income or
condition (financial or otherwise) of Borrower, (b) material impairment of
Borrower's ability to perform any of its obligations under this Agreement, the
Note or the Transaction Documents or (c) material impairment of the
enforceability of the rights of, or benefits available to, Lender under this
Agreement, the Note or the Transaction Documents. Any change in the business or
financial condition of the Company caused by a Material Adverse Effect shall be
a "Material Adverse Change".
     "Person" shall mean any individual, sole proprietorship, partnership, joint
venture, limited liability company, trust, unincorporated organization,
association, corporation, institution, entity or government (whether national,
Federal, state, county, city, municipal or otherwise, including, without
limitation, any instrumentality, division, agency, body or department thereof).
2.     LOAN. Lender agrees, subject to the terms and conditions of this
Agreement and the Transaction Documents, to provide to Borrower upon execution
of the Note, this Agreement and the Transaction Documents the Loan Amount, which
shall bear annual interest at nine and one half percent (9.5%) from the date
hereof for three consecutive months then increasing to the annual rate of twelve
and one half percent (12.5%) until maturity and be documented by the Note (the
"Loan").
3.     SECURITY INTEREST. As security for all Borrower's Obligations, Borrower
hereby grants Lender a subordinated security interest to First Bank & Trust,
4301 MacArthur Boulevard, Newport Beach, California 92660, in an aggregate
amount of Borrower's inventory and accounts receivable at all times equal to the
Loan Amount, with the inventory valued in accordance with GAAP and whether such
inventory is now owned or hereafter acquired, and wherever located, it being
understood and agreed that "inventory" shall have the meaning as defined in
Division 9 of the California Uniform Commercial Code in effect on the date
hereof, and all proceeds of the foregoing (collectively, the "Collateral").
4.     REPRESENTATIONS AND WARRANTIES OF BORROWER. Borrower represents to Lender
as follows, and Borrower agrees that the following representations will continue
to be true, and that Borrower will comply with all of the following warranties
throughout the term of this Agreement:
a.     Corporate Existence And Authority. Borrower is and will continue to be,
duly authorized, validly existing and in good standing under the laws of the
State of Nevada.  The execution, delivery and performance by Borrower of this
Agreement, and all other documents contemplated hereby have been duly and
validly authorized, and do not violate any law or any provision of, and are not
grounds for acceleration under, any agreement or instrument which is binding
upon Borrower. Notwithstanding any provision contained in this Agreement to the
contrary, Lender shall not be required to provide the Loan until it has
received:
i.     this Agreement and the Note, each executed by a duly authorized officer
of Borrower;
ii.     a copy of resolutions of the Board of Directors of Borrower, duly
adopted, which authorize the execution, delivery and performance of this
Agreement, the Note and the other Transaction Documents, certified by the
Secretary of Borrower;
iii.     such other agreements, documents, instruments and certificates as
Lender may reasonably request.
b.     Name; Places Of Business. Borrower's name as set forth in this Agreement
is its correct name. Borrower shall give Lender 15 days' prior written notice
before changing its name. The address set forth in the heading to this Agreement
is Borrower's chief executive office. In addition, Borrower has places of
business and Collateral is located only at the locations set forth above, except
for transactions in the ordinary course of business. Borrower will give Lender
at least 15 days' prior written notice before changing its chief executive.
c.     Collateral. Lender has and will at all times continue to have a
subordinated security interest in all of the Collateral. Borrower will
immediately advise Lender in writing of any material loss or damage to the
Collateral.
d.     Financial Condition. The financial statements of the Borrower are
contained in the consolidated financial statements of the Borrower as filed with
the Securities Exchange Commission and as such, the financial statements have
been, and will be, prepared in conformity with GAAP, consistently applied. Since
the last date covered by any such statement, there has been no material adverse
change in the financial condition or business of Borrower.
e.     Taxes; Compliance With Law. Borrower has filed, and will file, when due,
all tax returns and reports required by applicable law and Borrower has paid,
and will pay, when due, all taxes, assessments, deposits and contributions now
or in the future owed by Borrower. Borrower has complied, and will comply, in
all material respects, with all applicable laws, rules and regulations.
f.     Insurance. Borrower shall at all times insure all of the Collateral and
carry such other business insurance as is customary in the numismatic  industry,
and shall list Lender as a loss payee on such insurance as its interest may
appear, and provide evidence of such listing (in the form of a certificate of
insurance) to Lender upon request.
g.     Access To Collateral And Books And Records. At reasonable times, on two
(2) business days' notice,  the Lender, or their agents, shall have the right to
inspect the Collateral, and the right to audit and copy Borrower's books and
records at the expense of the Lender.
h.     Additional Agreements. Borrower shall not, without Lender's prior written
consent, do any of the following: (i) enter into any transaction outside the
ordinary course of business; (ii) sell, transfer or encumber any Collateral,
except in the ordinary course of business; (iii) redeem, retire, purchase or
otherwise acquire, directly or indirectly, any of Borrower's stock.
i.     No Defaults Or Events Of Default.  No Default or Event of Default under
this Agreement has occurred and is continuing.  There is no existing default or
event of default under or with respect to any indenture, contract, agreement,
lease or other instrument to which Borrower is a party or by which any property
or assets of Borrower is bound or affected, a default under which could
reasonably be expected to have a Material Adverse Effect.  Borrower is in full
compliance with and in good standing with respect to all governmental permits,
licenses, certificates, consents and franchises necessary to continue to conduct
its business as previously conducted by it and to own or lease and operate its
properties and assets as now owned or leased by it, the failure to have or
noncompliance with which could reasonably be expected to have a Material Adverse
Effect.  Borrower is not in violation of any applicable statute, law, rule,
regulation or ordinance of the United States of America, of any state, city,
town, municipality, county or of any other jurisdiction, or of any agency
thereof, a violation of which could reasonably be expected to have a Material
Adverse Effect.
5.     PAYMENT TERMS. Payment of all sums due hereunder shall become due and
shall be payable eighteen (18) months from the date of execution of the Note.
Interest payments shall be due and payable in arrears on or before the 5th day
of the month for the preceding month, and a late fee of two percent (2.0%) of
the payment due shall be imposed if interest is not timely paid in accordance
herewith. Borrower shall make each payment of principal of, and interest on, the
Loan and of fees and all other amounts payable by Borrower under this Agreement,
not later than 5:00 p.m. (Pacific time) on the date when due and payable,
without condition or deduction for any counterclaim, defense, recoupment or
setoff, in Federal or other funds immediately available to Lender at its address
referred to herein and in the Note.  All payments received by Lender after 5:00
p.m. (Pacific time) shall be deemed to have been received by Lender on the next
succeeding Business Day. Whenever any payment of principal of, or interest on,
the Loan or of fees shall be due on a day which is not a Business Day, the date
for payment thereof shall be extended to the next succeeding Business Day.  If
the date for any payment of principal is extended by operation of law or
otherwise, interest thereon, at the then applicable rate, shall be payable for
such extended time.  Notwithstanding the foregoing, upon the occurrence and
continuance of an Event of Default, all sums due hereunder shall, at the option
of the Lender, become immediately due and payable upon written notice to
Borrower.
6.     EVENTS OF DEFAULT. The occurrence of any of the following events shall
constitute an "Event of Default" under this Agreement: (a) Any representation,
statement, report or certificate given to Lender by Borrower or any of its
officers, employees or agents, now or in the future, is untrue or misleading in
a material respect; (b) Borrower fails to pay when due any Loan Amount or any
interest thereon or any other monetary Obligation; (c) Borrower fails to perform
any other non-monetary Obligation, which failure is not cured within ten (10)
business days after the date due; (d) Dissolution, termination of existence,
insolvency or business failure of Borrower; (e) appointment of a receiver,
trustee or custodian, for all or any part of the property of, assignment for the
benefit of creditors by, or the commencement of any proceeding by or against
Borrower under any reorganization, bankruptcy, insolvency, arrangement,
readjustment of debt, dissolution or liquidation law or statute of any
jurisdiction, now or in the future in effect (unless dismissed within 30 days of
commencement); (f) the failure to meet the periodic filing requirements under
The Securities Exchange Act of 1934, which failure is not cured within
forty-five (45) days after the date for such filing, not including any
extensions of such date; or (g) a Material Adverse Change in the business,
operations, or financial or other condition of Borrower, which is not cured
within 30 days. Upon failure to pay the indebtedness secured hereby in full
maturity, whether stated or by acceleration under Section 6 hereof, the Lender
is authorized and empowered to assemble and sell the whole or any part of the
Collateral in such manner as such Lender sees fit and is consistent with
applicable law. Sale of part of the Collateral shall not exhaust Lender's power
of sale, but sales may be made from time to time until all the Collateral is
sold, or until the debts hereby secured are paid in full.  Upon receipt of the
proceeds of such sale or sales, the Lender shall apply those proceeds in the
order stipulated in the relevant provisions of the California Commercial Code.
7.     INDEMNITY. Borrower hereby agrees to defend, indemnify, pay and hold the
Lender, and the officers, directors, employees, agents and affiliates of the
Lender (collectively, the "Indemnitees") harmless from and against any and all
other liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, claims, disbursements, costs and expenses of any kind or nature
whatsoever (including, without limitation, the reasonable fees and disbursements
of counsel for such Indemnitees in connection with any investigative,
administrative or judicial proceeding commenced or threatened, whether or not
such Indemnitees shall be designated a party thereto), that may be imposed on,
incurred by or asserted against the Indemnitees, in any manner relating to or
arising out of this Agreement, any of the other Transaction Documents or any
other agreement, document or instrument executed and delivered by Borrower in
connection herewith or therewith, the statements contained in any commitment
letters delivered by the  the Lender, the agreement of  the Lender to make the
Loan under this Agreement or the use or intended use of the proceeds of any Loan
under this Agreement (collectively, the "indemnified liabilities"); provided
that Borrower shall have no obligation to an Indemnitee hereunder with respect
to indemnified liabilities directly and solely resulting from the gross
negligence or willful misconduct of that Indemnitee as determined by a court of
competent jurisdiction in a final, nonappealable order. To the extent that the
undertaking to indemnify, pay and hold harmless set forth in the preceding
sentence may be unenforceable because it is violative of any law or public
policy, Borrower shall contribute the maximum portion that it is permitted to
pay and satisfy under applicable law to the payment and satisfaction of all
indemnified liabilities incurred by the Indemnitees or any of them.  The
provisions of the undertakings and indemnification set out in this Section 7
shall survive satisfaction and payment of the Borrower's Obligations and the
termination of this Agreement.
8.     NOTICES.  Each notice, request, demand, consent, confirmation or other
communication under this Agreement shall be in writing and delivered in person
or sent by facsimile or registered or certified mail, return receipt requested
and postage prepaid, to the applicable party at its address or facsimile number
set forth on the signature pages hereof, or at
such other address or facsimile number as any party hereto may designate as its
address for communications hereunder by notice so given.  Such notices shall be
deemed effective on the day on which delivered or sent if delivered in person or
sent by facsimile (with answerback confirmation received), or on the third (3rd)
Domestic Business Day after the day on which mailed, if sent by registered or
certified mail.
9.     GENERAL.

a.     Reimbursement Of Lender's Costs And Expenses.  Borrower agrees to pay or
reimburse the Lender upon demand for (a) all out-of-pocket costs and expenses
(including, without limitation, reasonable attorneys' fees and expenses up to a
maximum aggregate amount for all Lender of $2,000.00) incurred by the Lender in
connection with the preparation, documentation, negotiation and/or execution of
this Agreement and/or any of the other Transaction Documents, (b) all recording,
filing and search fees and expenses incurred by the Lender in connection with
this Agreement and/or any of the other Transaction Documents, (c) all
out-of-pocket costs and expenses (including, without limitation, reasonable
attorneys' fees and expenses) incurred by the Lender in connection with the
preparation of any waiver or consent under this Agreement or under any of the
other Transaction Documents and (d) if an Event of Default occurs, all
out-of-pocket costs and expenses (including, without limitation, reasonable
attorneys' fees and expenses) incurred by the Lender in connection with such
Event of Default and collection and other enforcement proceedings resulting
therefrom. Borrower further agrees to pay or reimburse the Lender upon demand
for any stamp or other similar taxes which may be payable with respect to the
execution, delivery, recording and/or filing of this Agreement and/or any of the
other Transaction Documents.  All of the obligations of Borrower under this
Section 9(a) shall survive the satisfaction and payment of the Borrower's
Obligations and the termination of this Agreement.
b.     Severability.  If any provision of this Agreement is held to be
unenforceable, the remainder of this Agreement shall still continue in full
force and effect.
c.     Assignability.  This Agreement may not be assigned by the Lender without
the express written consent of Borrower, and any attempted assignment without
such consent shall be void.
d.     Complete Agreement.  This Agreement and any other written agreements,
documents and instruments executed in connection herewith are the complete
agreement between Borrower and the Lender and supersede all prior and
contemporaneous negotiations and oral representations and agreements, all of
which are merged and integrated in this Agreement. There are no oral
understandings, representations or agreements between the parties which are not
in this Agreement or in other written agreements signed by the parties in
connection this Agreement.
e.     No Waiver. No failure to exercise and no delay on the part of the Lender
in exercising any right or power hereunder or granted to it by law will operate
as a waiver thereof; any single or partial exercise of any right, power or
privilege shall not preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.  Waiver by the Lender of any
right or other matter may only be made by an instrument in writing signed by the
Lender.  The rights and remedies provided in this Agreement are cumulative and
are not exclusive of any rights and remedies provided by law or by any other
agreement between the parties.  The Lender shall not be required to resort to or
pursue any of its rights or remedies under or with respect to any other
agreement or with respect to any other collateral, guarantee or other security
before pursuing any of his rights and remedies under this Agreement.  The Lender
may pursue its rights and remedies in such order as  it may choose.
f.     Amendment.  The provisions of this Agreement may not be amended, except
in an express writing signed by Borrower and the Lender.
g.     Governing Law.  This Agreement shall be governed by the laws of the State
of California. Notwithstanding anything to the contrary contained herein, no
provision of this Agreement or the Note shall require or permit the changing,
payment, or collection of interest at a rate in excess of the maximum lawful
rate permitted under California law.  If any interest in excess of the lawful
rate is provided in this Agreement or the Note, or shall be adjudicated to the
so provided, the provisions of this paragraph shall govern and prevail, and
Borrower shall not be obligated to pay the excess amount of such interest.  If
any interest in excess of such maximum lawful rate is paid to or collected by
the Lender, the full amount of such excess shall be applied toward reduction of
the outstanding principal balance or refunded to Borrower, as appropriate, so
that in no event shall the Lender charge, receive or collect interest at a rate
higher than the maximum rate permitted by California law.
h.     Mutual Waiver Of Jury Trial. BORROWER AND  THE LENDER EACH HEREBY WAIVE
THE RIGHT TO TRIAL BY JURY in any action or proceeding based upon, arising out
of, or in any way relating to, this agreement or any conduct, act or omission of
the Lender or Borrower or any of their directors, officers, employees, agents,
attorneys or affiliates.
i.     Counterparts.  This Agreement may be executed in any number of
counterparts (including facsimile counterparts),  which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
j.     Confidentiality.  Any information received by the Lender from Borrower
and clearly marked as confidential shall be treated as confidential by the
Lender.  Notwithstanding such agreement, nothing herein contained shall limit or
impair the right or obligation of the Lender to disclose such information: (i)
to its auditors, attorneys, trustees, employees, directors, officers, advisors,
affiliates or agents,  (ii) when and as required by any law, ordinance, subpoena
or governmental order, rule or regulation, (iii) as may be required, requested
or otherwise appropriate in any report, statement or testimony submitted to any
municipal, state, provincial or federal regulatory body or any self-regulatory
body having or claiming to have jurisdiction over the Lender, (iv) which is
publicly available or readily ascertainable from public sources, or which is
received by the Lender from a third Person which or which is not known by Lender
to be bound to keep the same confidential, (v) in connection with any
proceeding, case or matter pending (or on its face purported to be pending)
before any court, tribunal or any governmental agency, commission, authority,
board or similar entity, (vi) in connection with protection of its interests
under this Agreement, the Note or any of the other Transaction Documents,
including, without limitation, the enforcement of the terms and conditions of
this Agreement, the Note and the other Transaction Documents, (vii) to any
entity utilizing such information to rate the creditworthiness of the Lender or
(viii) to any actual or prospective assignee of this Agreement (it being
understood and agreed that prior to disclosure of any confidential information
to any actual or prospective assignee, such actual or prospective assignee shall
have agreed in writing to be bound by the terms and provisions of this Section
9.(j)).  It is agreed and understood that the Lender shall not be liable to
Borrower or any other Person for failure to comply with the foregoing except in
any case involving Lender's gross negligence or willful misconduct as determined
by a court of competent jurisdiction in a final, nonappealable order.

  [The remaining portion of this page is intentionally left blank. The signature
                                 page follows.]

<PAGE>

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.

TANGIBLE ASSET GALLERIES, INC.

By: /s/ Michael R. Haynes
Title: President

 LENDER:

SILVANO DIGENOVA

/s/ Silvano Digenova

<PAGE>

                                 PROMISSORY NOTE

U.S.  $959,440.00                                     Newport  Beach, California
     December  31,  2000

     FOR  VALUE  RECEIVED,  TANGIBLE ASSET GALLERIES, INC., a Nevada corporation
(hereinafter  referred  to  as  "Obligor"),  promises to pay to SILVANO DIGENOVA
(hereinafter  referred  to as "Holder"), the principal sum of Nine Hundred Fifty
Nine  Thousand Four Hundred Forty Dollars ($959,440.00), together with interest,
which  shall  accrue  at a rate of 9.5% per annum from the date hereof for three
consecutive  months, then increasing to the annual rate of 12.5% until maturity,
on  the  principal  sum  of  this  Note  from  time  to  time  outstanding.

1.  The  principal sum of the Note shall become due and shall be payable on June
30,  2002.
(a)     Interest  payments  shall be due and payable in arrears on or before the
5th  day  of  the  month  for the preceding month, and a late fee of two percent
(2.0%)  of  the  payment  due shall be imposed if interest is not timely paid in
accordance  herewith.
(b)     Notwithstanding  the foregoing, upon the occurrence and continuance of a
failure  to pay the principal of or interest on this Note when due (an "Event of
Default"),  this  Note  shall,  at the option of the Holder of this Note, become
immediately  due  and  payable  upon  written  notice  to  Obligor  during  the
continuance of such Event of Default and, in such event, the Holder of this Note
shall  have  and may exercise any and all of the rights and remedies he may have
under  the  laws  of  the  State  of  California.

     2.  All  payments  on this Note shall be made in lawful money of the United
States  of  America,  and  all notices by Obligor to the Holder shall be sent by
first  class  mail  and  if  so sent shall be deemed received by Holder 72 hours
after being deposited in the U.S. mails if addressed to Holder, at 32001 Pacific
Coast  Highway,  Laguna  Beach,  California  92651 or at such other place as the
Holder  shall  have  designated  hereafter to Obligor in writing.  Obligor shall
have  the  right to prepay any outstanding indebtedness hereunder in whole or in
part,  at  any  time.

     3.  To  secure  the  payment of this Note and of all other indebtedness now
owing  or  hereafter  incurred  by  Obligor  to Holder, Obligor hereby grants to
Holder  a  subordinated security interest in Obligor's accounts and inventory as
set  forth  in  Section  3  of  the  Loan  and  Security Interest being executed
herewith.

     4.  The  security  interest  created  hereby shall in no way be impaired or
otherwise  affected by or on account of any indulgence, forbearance, renewal, or
extension  of  this  Note  or of any other indebtedness created hereby.  Obligor
hereby  waives  presentment  and  notice  with  respect  to  the maturity of its
obligations  under  this  Note  and any other such debts, and hereby agrees that
Holder  may  foreclose  its  security  interest  in the Collateral without first
filing  suit  to  collect  this  Note.

     5.  Upon  failure  to pay the indebtedness secured hereby in full maturity,
whether  stated  or  by acceleration, Holder is authorized and empowered to sell
the  whole or any part of the Collateral then held by it in such manner, subject
to  the  security  interest  of  First  Bank  & Trust, as Holder sees fit and is
consistent with applicable law. Sale of part of the Collateral shall not exhaust
Holder's  power  of  sale, but sales may be made from time to time until all the
Collateral  is sold, or until the debts hereby secured are paid in full.  Holder
shall  receive the proceeds of such sale or sales and shall apply those proceeds
in  the order stipulated in the relevant provisions of the California Commercial
Code.  If  this  Note is placed in the hands of an attorney for collection or is
collected  in  whole  or  in  part through any judicial or arbitral proceedings,
Obligor  agrees  to  pay  Holder's  attorney's  fees  and  costs.

     6.  This  Note,  together with Holder's interest in the Collateral, may not
be  transferred or assigned by Holder without Obligor's express written consent,
and  any  attempted  assignment  without  such  consent  shall  be  void.

     7.  This  Note  shall be governed by and constructed in accordance with the
laws  of  the
State  of California. Notwithstanding anything to the contrary contained herein,
no  provision  of  this  Note  shall require or permit the changing, payment, or
collection  of interest at a rate in excess of the maximum lawful rate permitted
under  California law.  If any interest in excess of the lawful rate is provided
in this Note, or shall be adjudicated to the so provided, the provisions of this
paragraph  shall  govern  and prevail, and Obligor shall not be obligated to pay
the  excess  amount of such interest.  If any interest in excess of such maximum
lawful  rate  is  paid to or collected by Holder, the full amount of such excess
shall  be  applied  toward  reduction  of  the  outstanding principal balance or
refunded  to  Obligor,  as appropriate, so that in no event shall Holder charge,
receive  or collect interest at a rate higher than the maximum rate permitted by
California  law.

Dated:  December  31,  2000

TANGIBLE  ASSET  GALLERIES,  INC.

By:  /s/  Michael  R.  Haynes
Title:  PresidentCERTIFICATE OF DETERMINATION OF PREFERENCES
                             OF PREFERRED SHARES OF
                            ACCESSPOINT CORPORATION,
                              a Nevada Corporation

         The undersigned, James W. Bentley and Tom M. Djokovich, certify that:

1.       They are the duly  elected  or duly  acting  President  and  Secretary,
         respectively,   of  Accesspoint   Corporation,   a  Nevada  corporation
         ("Corporation").

2.       Pursuant  to  authority   given  by  the   Corporation's   Articles  of
         Incorporation,  the  Board of  Directors  of the  Corporation  has duly
         adopted the following recitals and resolutions:

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

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

         WHEREAS, at the time of adoption of this resolution one or more classes
         or series  of  outstanding  shares,  singly  or in the  aggregate,  are
         entitled to full voting rights;  the common shares of this  Corporation
         are entitled to full voting rights;

         WHEREAS,  at the  time  of  adoption  of this  resolution,  one or more
         classes or series of  outstanding  shares,  singly or in the aggregate,
         are entitled to unlimited dividend and liquidation rights;

         WHEREAS,  this Corporation has not issued any shares of Preferred Stock
         and the Board of Directors of this Corporation desires, pursuant to its
         authority,  to determine and fix the rights,  preferences,  privileges,
         and restrictions  relating to the initial series of Preferred Stock and
         the number of shares constituting and the designation of the series;

         NOW, THEREFORE, BE IT RESOLVED, the Board of Directors hereby fixes and
         determines the designation of, the number of shares  constituting,  and
         the rights, preferences,  privileges, and restrictions relating to, the
         initial series of Preferred Stock as follows:

(a)               DESIGNATION.   The  initial series of Preferred Stock shall be
         designated "Preferred shares, Series A."

(b)               NUMBER.The number of shares constituting the Preferred shares,
         Series A, shall be 2,500,000 shares.

(c)               VOTING. Preferred Shares, Series A, shall be non-voting shares
         as a class and the holders of the outstanding  Preferred Shares, Series
         A, shall not vote on any of the Corporation's matters.

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(d)               RESTRICTIONS. The holders of the outstanding Preferred Shares,
         Series A, may not dispose of any Preferred Shares, Series A, whether by
         sale, exchange, assignment,  transfer, gift, devise, bequest, mortgage,
         pledge,  encumbrance or otherwise,  except in accordance with the terms
         and  conditions  of this  Section (d), and holders may not take or omit
         any action  which will  impair the  absolute  and  unrestricted  right,
         power,  authority  and  capacity  of the  Corporation  to  enforce  the
         restrictions set forth in this Certificate of Determination.

                  Any purported  transfer of any Preferred Shares,  Series A, by
         any holder of outstanding Preferred Shares, Series A, that violates any
         provision of this Section (d) shall be wholly void and  ineffectual and
         shall give to the  Corporation  or its  designee  the right to purchase
         from the  holder  all but not less  than all of the  Preferred  Shares,
         Series  A, then  owned by holder  for a period of 90 days from the date
         the Corporation first learns of the purported transfer at the Agreement
         Price  and on the  Agreement  Terms  (as those  terms  are  defined  in
         subsections  (7) and (8),  respectively,  of this Section  (d)). If the
         Shares  are not  purchased  by the  Corporation  or its  designee,  the
         purported  transfer  thereof shall remain void and ineffectual and they
         shall continue to be subject to this Certificate of Determination.

                  The Corporation  shall not cause or permit the transfer of any
         Preferred  Shares,  Series  A,  to be  made  on  its  books  except  in
         accordance with the terms hereof.

         (1)      Permitted Transfers.

                  (i) The holder of any  Preferred  Shares,  Series A, may sell,
                  assign or transfer  any  Preferred  Shares,  Series A, held by
                  such  holder  but only by  complying  with the  provisions  of
                  subsection (4) of this Section (d).

                  (ii) The holder of any Preferred  Shares,  Series A, may sell,
                  assign or transfer  any  Preferred  Shares,  Series A, held by
                  such  holder   without   complying   with  the  provisions  of
                  subsection  (4) by obtaining the prior written  consent of the
                  Corporation's  shareholders  owning 50% of the then issued and
                  outstanding  shares of the  Corporation's  common voting stock
                  (determined  on a fully  diluted  basis) or a majority  of the
                  members of the Board of Directors of the Corporation, provided
                  that  the  transferee  agrees  in  writing  to be bound by the
                  provisions of any separate  shareholder  agreement between the
                  Corporation  and the  transferor  and the  transfer is made in
                  accordance with any other restrictions or conditions contained
                  in the  written  consent  and in  accordance  with  applicable
                  federal and state securities laws.

                  (iii) Upon the death of any holder of Preferred Shares, Series
                  A, the Preferred Shares, Series A, held by the deceased holder
                  may be  transferred  to  the  personal  representative  of the
                  deceased holder's estate without complying with the provisions
                  of subsection (4).  Shares so transferred  shall be subject to
                  the  other

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<PAGE>

                  provisions  of  this  Section  (d),  including  in particular,
                  and without limitation, subsection (6).

         (2)      No Pledge. Unless a majority of the  members  of the  Board of
         Directors  consent,  Preferred  Shares,  Series A, may not be  pledged,
         mortgaged  or otherwise  encumbered  to secure  indebtedness  for money
         borrowed  or any  other  obligation  for which the  holder  thereof  is
         primarily or secondarily liable.

         (3)      Stock Certificate Legend. Each stock certificate  representing
         Preferred Shares, Series A, shall have conspicuously written,  printed,
         typed or stamped  upon the face  thereof,  or upon the reverse  thereof
         with a conspicuous  reference on the face  thereof,  one or both of the
         following legends:

         THE SHARES  REPRESENTED BY THIS  CERTIFICATE ARE NON-VOTING  SHARES AND
         MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, OR OTHERWISE DISPOSED OF IN ANY
         MANNER  EXCEPT  IN  ACCORDANCE  WITH  AND  SUBJECT  TO THE  TERMS  OF A
         CERTIFICATE OF DETERMINATION  PERTAINING THERETO, A COPY OF WHICH IS ON
         FILE AT THE PRINCIPAL  OFFICE OF THE COMPANY.  UNLESS A MAJORITY OF THE
         MEMBERS  OF  THE  BOARD  OF  DIRECTORS  CONSENT,  SUCH  CERTIFICATE  OF
         DETERMINATION  PROHIBITS ANY PLEDGE,  MORTGAGE OR OTHER  ENCUMBRANCE OF
         SUCH  SHARES TO SECURE  ANY  OBLIGATION  OF THE  HOLDER  HEREOF.  EVERY
         CREDITOR OF THE HOLDER HEREOF AND ANY PERSON ACQUIRING OR PURPORTING TO
         ACQUIRE THIS CERTIFICATE OR THE SHARES HEREBY EVIDENCED OR ANY INTEREST
         THEREIN IS HEREBY  NOTIFIED OF THE  EXISTENCE  OF SUCH  CERTIFICATE  OF
         DETERMINATION,  AND ANY  ACQUISITION  OR PURPORTED  ACQUISITION OF THIS
         CERTIFICATE  OR THE SHARES  HEREBY  EVIDENCED OR ANY  INTEREST  THEREIN
         SHALL  BE  SUBJECT  TO ALL  RIGHTS  AND  OBLIGATIONS  SET  FORTH IN THE
         CERTIFICATE OF DETERMINATION.

         (4)      Sales of Preferred Shares, Series A.

                  (i)  Corporation's  Right of First Refusal.  In the event that
                  the holder of any Preferred Shares,  Series A, shall desire to
                  sell,  assign or transfer any Preferred  Shares,  Series A, to
                  any  other  person  (the  "Offered  Shares")  and  shall be in
                  receipt of a bona fide offer to purchase  the  Offered  Shares
                  ("Offer"),  the following procedure shall apply. The holder of
                  Preferred  Shares,  Series A,  shall  give to the  Corporation
                  written  notice  containing  the terms and  conditions  of the
                  Offer, including, but not limited to (a) the number of Offered
                  Shares;  (b) the price per share for the Offered  Shares;  (c)
                  the method of  payment;  and (d) the  name(s) of the  proposed
                  purchaser(s).

                  (ii) An offer  shall not be deemed bona fide unless the holder
                  of Preferred  Shares,  Series A, has informed the  prospective
                  purchaser  of  the  obligation   under  this   Certificate  of
                  Determination  and the  prospective  purchaser  has  agreed to
                  become a party to any stock restriction agreements between the
                  Corporation and the holder of Preferred Shares,  Series A, and
                  to be bound thereby. The

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                  Corporation  shall  be  entitled  to  take  such steps,  as it
                  reasonably  may  deem necessary to  determine the validity and
                  bona fide nature of the Offer.

                  (iii)  Until  30  days  after  such   notice  is  given,   the
                  Corporation  or its designee  shall have the right to purchase
                  all  of  the  Offered  Shares  at  the  price  offered  by the
                  prospective  purchaser  and  specified  in such  notice.  Such
                  purchase  shall  be on the  Agreement  Terms,  as  defined  in
                  subsection (8).

         (5)      Failure  of  Corporation or its  Designee  to Purchase Offered
         Shares.  If  all  of  the  Offered  Shares  are  not  purchased  by the
         Corporation  and/or its designee  within the 30-day period  granted for
         such purchases, then any remaining Offered Shares may be sold, assigned
         or transferred pursuant to the Offer; provided, that the Offered Shares
         are so  transferred  within  30 days of the  expiration  of the  30-day
         period to the  person  or  persons  named  in,  and under the terms and
         conditions  of,  the bona fide  Offer  described  in the  notice to the
         Corporation; and provided further, that such persons acknowledge to the
         reasonable  satisfaction  of the  Corporation  that they  shall then be
         bound by the terms and conditions of this  Certificate of Determination
         and agree to be bound by the terms and  conditions  of any  shareholder
         agreement or similar restrictive agreement between the Corporation and
                                                                 the transferor.

         (6)      Manner of Exercise. Any right to purchase  hereunder  shall be
         exercised  by  giving  written  notice  of  election  to the  holder of
         Preferred Shares, Series A, the holder's personal representative or any
         other selling  person,  as the case may be, prior to the  expiration of
         such right to purchase.

         (7)      Agreement Price. The "Agreement  Price" shall be the higher of
         (a) the fair  market  value of the  Preferred  Shares,  Series A, to be
         purchased  determined  in good faith by the Board of  Directors  of the
         Corporation  and (b) the  conversion  price,  if any, of the  Preferred
         Shares, Series A, to be purchased.

         (8)      Agreement Terms. "Agreement Terms" shall mean and  include the
                  following:

                  (i) Delivery of Shares and Closing Date.  At the closing,  the
                  holder of Preferred  Shares,  Series A, the holder's  personal
                  representative  or such other selling person,  as the case may
                  be, shall  deliver  certificates  representing  the  Preferred
                  Shares, Series A, properly endorsed for transfer, and with the
                  necessary   documentary  and  transfer  tax  stamps,  if  any,
                  affixed, to the purchaser of such Preferred Shares,  Series A.
                  Payment of the purchase price therefor shall  concurrently  be
                  made to the holder,  the holder's  personal  representative or
                  such other selling  person,  as provided in subsection (ii) of
                  this  subsection  (8). Such delivery and payment shall be made
                  at the principal  office of the  Corporation  or at such other
                  place as the Board of Directors may determine.

                  (ii) Payment of Purchase Price. The purchase price may be paid
                  by the  Corporation  in cash or cash  equivalent  or shares of
                  common voting stock of the  Corporation.  The shares of common
                  voting  stock of the  Corporation  shall be valued at the fair
                  market  value on the day of  closing as may be  determined  in
                  good faith by the Board of Directors.  The  Corporation  shall
                  pay the  purchase

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<PAGE>

                  price to the  holder of  Preferred  Shares,   Series A, at the
                  closing.

         (9)      Right to  Purchase  Upon Certain Other Events. The Corporation
         or its designee shall have the right to purchase all, but not less than
         all, of the Preferred  Shares,  Series A, held by any holder thereof at
         the Agreement  Price and on the Agreement Terms for a period of 90 days
         after any of the following events:

                  (i)  an  attempt by a creditor to levy upon or sell any of the
                  Preferred Shares, Series A;

                  (ii) the  filing  of a  petition  by  the  holder of Preferred
                  Shares,  Series  A, under  the  U.S.  Bankruptcy  Code  or any
                  insolvency laws;

                  (iii) the filing of a petition against the holder of Preferred
                  Shares,  Series A, under any insolvency or bankruptcy  laws by
                  any creditor of the holder if such  petition is not  dismissed
                  within 30 days of filing;

                  (iv) the  entry of  a  decree of divorce between the holder of
                  Preferred  Shares, Series A, and the spouse of such holder; or

                  (v) if  the  holder  of  Preferred  Shares,  Series  A,  is an
                  employee  or  consultant  of  the  Corporation  or  any of its
                  subsidiaries,  the termination of the holder's  services as an
                  employee or consultant..

                  The holder of Preferred  Shares,  Series A, shall  provide the
                  Corporation  with written notice of the occurrence of any such
                  event within 30 days of such event.

         (10)     Termination. The provisions of this Section (d)shall terminate
         and all rights and obligations of the Corporation and of each holder of
         Preferred  Shares,  Series A, set forth in this Section (d) shall cease
         with  regard to the  Preferred  Shares,  Series,  A,  (except for those
         similar or other rights and  obligations  which shall have  theretofore
         accrued  pursuant to separate  agreement) upon the occurrence of any of
         the following events:

                  (i)  cessation of the Corporation's business;

                  (ii)  bankruptcy,  receivership  or  dissolution  of  the
                  Corporation;

                  (iii) ownership of all of the issued and outstanding Preferred
                  Shares,  Series A, by a single shareholder;

                  (iv) written  consent or agreement of the  shareholders of the
                  Corporation  holding  50% of the then  issued and  outstanding
                  common voting shares of the Corporation (determined on a fully
                  diluted basis);

                  (v)  consent or agreement of a majority of the  members of the
                  Board of  Directors of the Corporation; or

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<PAGE>

                  (vi) registration of the Preferred Shares,  Series A, as class
                  of equity securities of the Corporation pursuant to Section 12
                  of the Securities Exchange Act of 1934, as amended.

         (11)     Amendment.  To  the  fullest extent allowed by applicable law,
         this  Section  (d) may be  modified or amended in whole or in part by a
         written  instrument  signed by shareholders of the Corporation  holding
         50% of the  outstanding  shares of Common Stock  (determined on a fully
         diluted  basis) or a majority of the members of the Board of  Directors
         of the Corporation.

(e)               DIVIDENDS.  The  holders of the outstanding Preferred  Shares,
         Series A, shall be  entitled  to  receive,  when and as declared by the
         Board of  Directors of the  Corporation,  out of any assets at the time
         legally available, dividends at the annual rate determined by the board
         of  directors  in its sole and  unreviewable  discretion,  and no more,
         payable in such form and at such time as the Board of Directors  may so
         determine to holders of Preferred Shares, Series A, of record on a date
         not more  than 60 nor  fewer  than 10 days  preceding  each  respective
         payment  date as  specified  by the  Board of  Directors  or, if not so
         specified,  as  provided  by law.  Dividends  shall  not  accrue on any
         Preferred Share, whether or not earned or declared. Dividends shall not
         be  accumulative,  if declared,  and not paid.  The  Preferred  Shares,
         Series A, shall be deemed noncumulative, nonparticipating. The right to
         dividends on Preferred Shares,  Series A, shall not be cumulative,  and
         no right  shall  accrue to holders of  Preferred  Shares,  Series A, by
         reason of the fact that  dividends  on those shares are not declared in
         any prior year,  nor shall any  undeclared  or unpaid  dividend bear or
         accrue interest.

(f)               CONVERSION. Subject to the provisions of applicable law to any
         applicable  restrictions  on the rights of a corporation to convert its
         own  securities,  the  Corporation,  at  the  option  of the  Board  of
         Directors,  may at any time or from time to time  convert  the whole or
         any part of the  outstanding  Preferred  Shares,  Series  A, to  common
         voting shares issued by this  Corporation.  The Board of Directors may,
         subject to terms and conditions of this  Certificate of  Determination,
         establish by agreement with the individual holders of Preferred Shares,
         Series  A, or any of them  individually,  from  time to  time,  certain
         redemption  eligibility  criteria,  terms and  conditions not otherwise
         inconsistent  with this  Certificate  of  Determination.  The Preferred
         Shares,  Series A, shall be converted into fully paid and nonassessable
         common shares of the  Corporation,  at the rate of one common share for
         each  preferred  share,  subject  to  limited  adjustment  as set forth
         herein.  No adjustment shall be made with respect to dividends that may
         be accrued  and unpaid at the date of  surrender  for  conversion.  The
         holders  of  the  Preferred  Shares,  Series  A,  shall  surrender  the
         certificate or  certificates  for those shares at the time and place so
         directed by the  Corporation.  The  Corporation  may determine that the
         Preferred Shares, Series A, shall be surrendered at any place where the
         Corporation  shall  maintain a transfer  agent for its common shares or
         its preferred shares of any class or series.

                  At least  ten  (10)  days  previous  notice  by mail,  postage
         prepaid,  shall be given to the  holders  of  record  of the  Preferred
         Shares,  Series A, to be converted as of the date of mailing or as of a
         record date lawfully fixed. Such notice shall be addressed to each such
         shareholder at the address of that holder appearing on the books of the
         Corporation or given by that holder to the  Corporation for the purpose
         of notice or if no such  address

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<PAGE>

         appears or is so given, at the place where the principal  office of the
         Corporation  is  located.  The  notice  shall  state the date fixed for
         conversion,  the  conversion  ratio and shall call upon that  holder to
         surrender to the Corporation the date fixed and at the place designated
         in the notice the holder's certificate or certificates representing the
         shares to be converted if those  shares are  certificated.  On or after
         the date fixed for conversion and stated in that notice, each holder of
         Preferred Share,  Series A, called for conversion shall if those shares
         are  certificated,  surrender the certificate  evidencing the shares to
         the  Corporation  at the  place  designated  in the  notice  and  shall
         thereupon be entitled to receive  common shares of the  Corporation  at
         the conversion ratio. The certificate or certificates  representing the
         Preferred  Shares,  Series A, to be converted shall be surrendered duly
         endorsed in blank or accompanied by proper instruments of transfer,  at
         the  office  of  the  Corporation  or of any  transfer  agent  for  the
         Preferred Shares.  If less than all the shares  represented by any such
         surrendered  certificate  are  converted,  a new  certificate  shall be
         issued representing the unconverted shares.

                  If the notice of  conversion  shall have been duly given then,
         notwithstanding that the certificates  evidencing any Preferred Shares,
         Series A, so called for conversion shall not have been surrendered, all
         rights with respect to the shares so called for conversion  shall after
         that date  cease.  Conversion  shall be deemed to have been made on the
         date fixed for the conversion by the Board of Directors  whether or not
         certificates  representing  Preferred Shares, Series A, shall have been
         surrendered  and the person or persons  entitled  to receive the common
         shares  issuable upon  conversion  shall be treated for all purposes as
         the record  holder or holders  of the common  shares on that date.  The
         Board of Directors  may order any holders of  outstanding  certificates
         for  Preferred  Shares,  Series A, to surrender  them for  certificates
         evidencing  common  shares.  The  order  may  provide  that a holder of
         certificates  so to be  exchanged is not entitled to vote or to receive
         dividends  or to exercise any other  rights of a  shareholder,  if any,
         until the holder has  complied  with the order,  but the order shall be
         operative only after notice and only until compliance.

                  The number of common shares into which Preferred Shares may be
         converted  shall be subject to limited  adjustment from time to time in
         certain cases as follows:

         (1)      If the Corporation shall subdivide or combine its  outstanding
         common shares into a greater or smaller number of shares,  then in each
         such case the number of common shares into which  Preferred  Shares may
         be converted shall be increased or reduced in the same proportion;
         (2)       If   there   occurs  any  capital  reorganization   or    any
         reclassification   of  the  capital  stock  of  the  Corporation,   the
         consolidation  or  merger  of the  Corporation  with  or  into  another
         corporation,  or the sale or conveyance of all or substantially  all of
         the assets of the  Corporation to another  corporation,  each Preferred
         Share, Series A, shall thereafter be convertible into the same kind and
         amounts of securities  (including  shares of stock) or other assets, or
         both, issuable or distributable to the holders of outstanding preferred
         shares  of  the  Corporation  upon  reorganization,   reclassification,
         consolidation,  merger,  sale,  or  conveyance;  and in any such  case,
         appropriate adjustments (as determined by the Board of Directors) shall
         be made  applying the  provisions  herein set forth with respect to the
         rights and interests thereafter of the holders of the Preferred Shares,
         Series  A,  to  the  end  that  the  provisions  set  forth  (including
         provisions  with respect to changes in, and

                                     7 of 12
<PAGE>

         other   adjustments  of,  the  conversion  rate)  shall  thereafter  be
         applicable,  as  nearly  as  reasonably  may  be,  in  relation  to the
         Preferred Shares, Series A.

         (3)      Immediately  upon adjustment of the amount of common shares or
         other securities  deliverable upon the conversion of Preferred  Shares,
         Series A, the Corporation shall file, at its principal executive office
         and with any  transfer  agent or agents  for  Preferred  Shares and for
         common  shares,  a  statement,  signed by the  Chairman  of the  Board,
         President, or one of the Vice Presidents of the Corporation, and by its
         Chief Financial Officer or one of its Assistant Treasurers, stating the
         adjusted amount of its commons shares or other  securities  deliverable
         per  Preferred   Share,   Series  A,  calculated  to  the  nearest  one
         one-hundredth  and  setting  forth in  reasonable  detail the method of
         calculation  and the facts  requiring the adjustment and upon which the
         calculation is based.  Each  adjustment  shall remain in effect until a
         subsequent adjustment hereunder is required.

                  The Corporation  shall at all times reserve and keep available
         out of its  authorized  but unissued  common  shares the full number of
         common  shares   deliverable  upon  the  conversion  of  all  the  then
         outstanding  Preferred Shares,  Series A, and shall take all action and
         obtain  all  permits  or orders  that may be  necessary  to enable  the
         Corporation  lawfully to issue  common  shares upon the  conversion  of
         Preferred Shares, Series A.

                  No fractions of common shares shall be issued upon conversion.
         In lieu thereof nondividend bearing,  nonvoting scrip (exchangeable for
         full  shares)  shall be issued  in (form  bearer  or  registered),  and
         denominations,  expiring after a reasonable  time and  containing  such
         other  terms  and  provisions,   as  the  Board  of  Directors  of  the
         Corporation may from time to time determine prior to the issue thereof.
         The Corporation may, however,  at its option, in lieu of issuing scrip,
         make equitable  provision for the stock holders  otherwise  entitled to
         receive  scrip  as the  Board of  Directors  may  determine,  including
         payment  of cash,  or sale or stock to the  extent  of that  scrip  and
         distribution of the net proceeds or otherwise.

(g)               REDEMPTION.  Subject to the  provisions of applicable  law and
         to any  applicable  restriction on the right of a corporation to redeem
         its  own  shares,  the  Corporation,  at the  option  of the  Board  of
         Directors, may at any time or from time to time redeem the whole or any
         part of the  outstanding  Preferred  Shares,  Series  A.  The  Board of
         Directors may,  subject to terms and conditions of this  Certificate of
         Determination,  establish by agreement with the  individual  holders of
         Preferred Shares,  Series A, or any of them individually,  from time to
         time, certain redemption eligibility criteria, terms and conditions not
         otherwise  inconsistent  with this Certificate of  Determination.  Upon
         redemption,  the Corporation  shall pay each share redeemed cash in the
         amount of 10/100 Dollars  ($0.10) per share plus an amount equal to all
         dividends  thereon  declared  but  unpaid  on the  date  of  fixed  for
         redemption.  The total  amount  payable  per share is payable is called
         "the Redemption  Price" below. In case of the redemption of a part only
         of the outstanding  Preferred  Shares,  Series A, the Corporation shall
         designate  pro  rata  or by lot or  other  criteria  the  shares  to be
         redeemed.

                  At least  ten  (10)  days  previous  notice  by mail,  postage
         prepaid,  shall be given to the  holders  of  record  of the  Preferred
         Shares,  Series A, to be  redeemed as of the date of mailing or as of a
         record date lawfully fixed. Such notice shall be addressed to each such

                                    8 of 12
<PAGE>

         shareholder at the address of that holder appearing on the books of the
         Corporation or given by that holder to the  Corporation for the purpose
         of notice,  or if no such address  appears or is so given, at the place
         where the principal  office of the  Corporation is located.  The notice
         shall state the date fixed for redemption and the redemption  price and
         shall call upon that holder to surrender to the Corporation on the date
         fixed  and  at  the  place   designated  in  the  notice  the  holder's
         certificate or certificates  representing  the shares to be redeemed if
         those shares or certificated. On or after the date fixed for redemption
         dated in that notice, the holder of Preferred Shares,  Series A, called
         for redemption shall, if those shares are  certificated,  surrender the
         certificate  evidencing  the  shares  of the  Corporation  at the place
         designated  in the notice and shall  thereupon  be  entitled to receive
         payment  of  the  redemption   price.  If  less  than  all  the  shares
         represented by any such surrendered  certificates  are redeemed,  a new
         certificate shall be issued  representing the unredeemed shares. If the
         notice of  redemption  shall have been duly  given,  and if on the date
         fixed for redemption  funds necessary for redemption shall be available
         to  pay  the  redemption   price,   then,   notwithstanding   that  the
         certificates  evidencing any Preferred Shares,  Series A, so called for
         redemption shall not have been surrendered,  all rights with respect to
         the shares so called for redemption shall after that date cease, except
         only the  right of holder  to  receive  the  redemption  price  without
         interest  upon  surrender  of their  certificates,  if those  Preferred
         Shares, Series A, are certificated.

                  On or prior to any date  fixed  for  redemption  of  Preferred
         Shares,  Series A, the Corporation  may, but shall not be obligated to,
         deposit with any bank or trust company in California, as a trust fund:

         (1)      a sum sufficient to redeem on  the date fixed for  redemption,
         the shares called for redemption;

         (2)      in  the case of redemption  of any uncertificated  securities,
         an officer's certificate setting forth the holders thereof,  registered
         on the books of the Corporation and the number of shares held by each;

         (3)      instructions  and  authority  to the bank or trust  company to
         give the notice of  redemption  (or to complete the giving of notice if
         commenced)  and to pay,  on or after the date fixed for  redemption  or
         prior thereto the  redemption  price of the shares to their  respective
         holders upon the surrender of their share certificates;  in the case of
         uncertificated  securities,  then from and  after  the date of  deposit
         (although  prior to the date fixed for redemption) the shares so called
         shall be redeemed and dividends on those shares shall be redeemed.

                  As used in this section,  "officer's certificate" shall mean a
         certificate  signed and  verified  by the  chairman of the board or the
         president or the chief  executive  officer or any vice president and by
         the secretary,  the chief  financial  officer,  the  treasurer,  or any
         assistance  secretary or assistant  treasurer of the  Corporation.  The
         deposit,  if any, shall  constitute full payment of the shares to their
         holders  and from and after the date of  deposit,  the shares  shall no
         longer  be  outstanding  and the  holders  thereof  shall  cease  to be
         shareholders  with the respect to those shares and shall have no rights
         with respect to them except the right to receive from the bank or trust
         company payment of the redemption price of the shares without interest,
         upon the  surrender  of their  certificates  the  shares

                                    9 of 12

<PAGE>

         redeemed are certificated and without  surrender if the shares redeemed
         are  uncertificated  as above.  Any  interest  accrued  on any funds so
         deposited  shall be the property of, and paid to, the  Corporation.  If
         the holders of  Preferred  Shares,  Series A, so called for  redemption
         shall  not,  at the end of three  (3)  years  from the date  fixed  for
         redemption,  have  claimed  any funds so  deposited,  the bank or trust
         company  shall  thereupon  pay over to the  Corporation  the  unclaimed
         funds,  and the bank or trust company  shall  thereafter be relieved of
         all responsibility to the holders, and those holders shall look only to
         the Corporation, for payment of the redemption price.

                  So long as any of the  Preferred  Shares,  Series A,  shall be
         outstanding,  the  Corporation,  as a sinking  fund for the purchase or
         redemption thereof (herein after "the Sinking Fund") may, but shall not
         be obligated to, set aside in cash out of any monies legally  available
         therefore,  after full payment or provision for payment of dividends on
         the Preferred Shares, Series A, and all other shares of the Corporation
         ranking  prior to or on a parity with the Preferred  Shares,  Series A,
         for all prior periods  through the end of the last preceding  quarterly
         dividend period for those shares.  The Corporation,  at its option, may
         make  additional  payments  to, and make  purchases  or  redemption  of
         Preferred Shares, Series A, pursuant to, the Sinking Fund.

(h)               LIQUIDATION.   In  the  event of  a  voluntary or  involuntary
         liquidation, dissolution, or winding up of the Corporation, the holders
         of Preferred Shares,  Series A, shall be entitled to receive out of the
         assets of the Corporation,  whether those assets are capital or surplus
         of any nature,  an amount  equal to $1.00 per  Preferred  Share,  and a
         further  amount equal to any dividends  thereon  declared and unpaid on
         the date of that  distribution and no more, before any payment shall be
         made or any assets distributed to the holders of common shares.

                  After  payment or  distribution  to the  holders of  Preferred
         Shares,  Series A, of the full  preferential  amounts,  the  holders of
         common  shares  shall be entitled  to receive  ratably,  all  remaining
         assets of the Corporation.

                  A consolidation  or merger of the Corporation with or into any
         other  corporation or corporations,  or other entity or the sale of all
         or  substantially  all of the assets of the  Corporation,  shall not be
         deemed to be a  liquidation,  dissolution,  or winding  up,  within the
         meaning of this Section.

         RESOLVED FURTHER,  that the Chairman of the Board, the President or any
         Vice President,  and the Secretary,  the chief financial  officer,  the
         Treasurer,  or any Assistant  Secretary or Assistant  Treasurer of this
         Corporation  are  each  authorized  to  execute,  verify,  and  file  a
         certificate  of   determination   of  preferences  in  accordance  with
         California law.

3.       The authorized  number of shares of Preferred  Stock of the Corporation
         is 5,000,000,  and the number of shares  constituting Series A, none of
         which has been issued, is 2,500,000.

                                    10 of 12

<PAGE>

IN WITNESS WHEREOF,  the undersigned have executed this certificate on APRIL 11,
2000.

                                                   By: /s/ James W. Bentley
                                                   -----------------------------
                                                   James W. Bentley,
                                                   President

                                                   By: /s/ Tom M. Djokovich
                                                   -----------------------------
                                                   Tom M. Djokovich,
                                                   Secretary

                                    11 of 12

<PAGE>

                                  VERIFICATION

State of California          )
                             ) ss.
County of Orange             )

On April 11, 2000,  before me,  MaryAnn  Bentley,  personally  appeared James W.
Bentley  and Tom M.  Djokovich,  personally  known to me (or proved to me on the
basis  of  satisfactory  evidence)  to be the  person(s)  whose  name(s)  is/are
subscribed to the within  instrument  and  acknowledged  to me that  he/she/they
executed  the  same  in  his/her/their  authorized  capacity(ies),  and  that by
his/her/their  signature(s) on the instrument the person(s),  or the entity upon
behalf of which the person(s) acted, executed the instrument.

WITNESS my hand and official seal.

By: /s/ MaryAnn Bentley
--------------------------------------
MaryAnn Bentley,
Notary Public

                                    12 of 12

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