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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                  SCHEDULE 14A
                                 (Rule 14a-101)

                            SCHEDULE 14A INFORMATION

                    Proxy Statement Pursuant to Section 14(a)
                     of the Securities Exchange Act of 1934



Filed by Registrant  |X|

Filed by a Party other than the Registrant  |_|

Check the appropriate box:

|X|      Preliminary Proxy Statement

|_|      Confidential,  for Use  of the  Commission Only (as permitted  by  Rule
         14a-6(3)(2))

|_|      Definitive Proxy Statement

|_|      Definitive Additional Materials

|_|      Soliciting Material Pursuant to ss.240.14a-12


                        PARADIGM MEDICAL INDUSTRIES, INC.
                (Name of Registrant as Specified In Its Charter)

                    -----------------------------------------
    (Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the Appropriate box):

|X|      No fee required.

|_|      Fee computed on table below  per Securities Exchange Act Rules 15a-6(i)
         (4) and 0-11.*

|_|      Fee paid previously with preliminary materials.

         (1)      Title  of  each  class  of  securities  to  which  transaction
                  applies:   (2)   Aggregate   number  of  securities  to  which
                  transaction applies:
         (3)      Per  unit  price  or other  underlying  value  of  transaction
                  computed  pursuant to  Securities  Exchange Act Rule 0-11 (set
                  forth the  amount on which the filing  fee is  calculated  and
                  state how it was determined):
         (4)      Proposed maximum aggregate value of transaction: (5) Total fee
                  paid:

|_|      Check box if any  part of the  fee is offset as provided  by Securities
         Exchange  Act  Rule 0-11(a)(2)  and identify  the  filing for which the
         offsetting  fee  was paid  previously.  Identify the previous filing by
         registration statement number, or the  Form or Schedule and the date of
         its filing.
         (1)      Amount Previously Paid:
         (2)      Form,  Schedule  or  Registration  Statement  No.:  (3) Filing
                  Party: (4) Date Filed:






                        PARADIGM MEDICAL INDUSTRIES, INC.

                              2355 South 1070 West
                           Salt Lake City, Utah 84119


                                February 22, 2008






Dear Shareholder:

         On behalf of the Board of Directors, it is my pleasure to invite you to
attend the Special Meeting of Shareholders  (the "Special  Meeting") of Paradigm
Medical Industries,  Inc. (the "Company") to be held on Friday,  March 21, 2008,
at 10:00 a.m.,  Mountain Standard Time, at 2355 South 1070 West, Salt Lake City,
Utah 84119.  The formal  notice of the Special  Meeting and the Proxy  Statement
have been made a part of this invitation.

         The matter to be  addressed  at the Special  Meeting is the approval of
the  proposed  amendment to the  Certificate  of  Incorporation  to increase the
number  of  authorized  shares  of  common  stock  from  800,000,000  shares  to
1,400,000,000   shares.  Please  refer  to  the  Proxy  Statement  for  detailed
information on the proposal and the Special Meeting of Shareholders.

         Your vote is very  important.  We hope you will take a few  minutes  to
review the Proxy Statement and complete, sign, and return your Proxy Card in the
envelope  provided,  even if you plan to attend the  meeting.  Please  note that
sending us your Proxy will not prevent you from voting in person at the meeting,
should you wish to do so.

         Thank you for your support of Paradigm Medical Industries, Inc. We look
forward to seeing you at the Special Meeting.

                                          Sincerely yours,

                                          /s/  Raymond P.L. Cannefax

                                          Raymond P.L. Cannefax
                                          President and Chief Executive Officer





                        PARADIGM MEDICAL INDUSTRIES, INC.
                              2355 South 1070 West
                           Salt Lake City, Utah 84119

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

                    NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
                            TO BE HELD MARCH 21, 2008

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



To our Shareholders:

         NOTICE IS HEREBY GIVEN that the Special  Meeting of  Shareholders  (the
"Special  Meeting") of Paradigm  Medical  Industries,  Inc. (the "Company") will
held on Friday,  March 21, 2008, beginning at 10:00 a.m. Mountain Standard Time,
at the Company's corporate headquarters at 2355 South 1070 West, Salt Lake City,
Utah.  At the  Special  Meeting,  shareholders  will  consider  and act upon the
following matter:

         1.   To approve the proposed amendment to the Company's  Certificate of
              Incorporation  to  increase  the  number of  authorized  shares of
              common stock from 800,000,000 to 1,400,000,000 shares; and

         2.   To transact  such other  business as may properly  come before the
              meeting or any adjournment thereof.

         The foregoing  items of business are more fully  described in the Proxy
Statement  accompanying  this Notice.  Also included is a single-page Proxy Card
and a postage prepaid return envelope.  Only shareholders of record at the close
of business on February  15, 2008 are entitled to notice of, and to vote at, the
Special Meeting or any adjournment thereof.

         If you do not expect to attend the meeting in person,  it is  important
that your shares be  represented.  Please use the enclosed Proxy Card to vote on
the matters to be  considered  at the meeting,  sign and date the proxy card and
mail it promptly in the enclosed  envelope,  which requires no postage if mailed
in the United  States.  You may revoke your proxy at any time before the meeting
by written notice to such effect, by submitting a subsequently dated proxy or by
attending  the meeting and voting in person.  If your shares are held in "street
name," you should instruct your broker how to vote in accordance with your Proxy
Card.

                                          By order of the Board of Directors,

                                          /s/  Luis A. Mostacero

                                          Luis A. Mostacero
                                          Vice President of Finance,
                                          Chief Financial Officer,
                                          Treasurer and Secretary


February 22 2008
Salt Lake City, Utah







                        PARADIGM MEDICAL INDUSTRIES, INC.
                              2355 South 1070 West
                           Salt Lake City, Utah 84119


                                 PROXY STATEMENT

                 INFORMATION CONCERNING SOLICITATION AND VOTING

General

         The enclosed  Proxy is solicited on behalf of the Board of Directors of
Paradigm Medical  Industries,  Inc., a Delaware  corporation (the "Company") for
use at the Special Meeting of Shareholders (the "Special Meeting") to be held on
Friday,  March 21, 2008,  beginning at 10:00 a.m., Mountain Daylight Time, or at
any adjournment(s)  thereof.  The purpose of the meeting is set forth herein and
in the  accompanying  Notice of Special  Meeting of  Shareholders.  The  Special
Meeting will be held at the Company's corporate  headquarters at 2355 South 1070
West, Salt Lake City, Utah. This Proxy Statement and accompanying  materials are
being mailed on or about  February  22, 2008.  The Company will bear the cost of
this solicitation.

         The matters to be brought before the Special Meeting are (1) to approve
an amendment  to the  Company's  Certificate  of  Incorporation  to increase the
number of authorized  common shares of common stock from  800,000,000  shares to
1,400,000,000  shares;  and (2) to transact such other  business as may properly
come before the Special Meeting.

Record Date

         Shareholders  of record of the  Company's  Common Stock at the close of
business  on  February  15,  2008 are  entitled  to notice of and to vote at the
meeting.  As of January 31, 2008,  680,984,307  shares of the  Company's  Common
Stock,  $.001 par value,  5,627  shares of the Series A Preferred  Stock,  8,986
shares of Series B Preferred Stock, no shares of Series C Convertible  Preferred
Stock,  5,000  shares of Series D  Convertible  Preferred  Stock,  250 shares of
Series E  Convertible  Preferred  Stock,  4,398.75  shares of Series F Preferred
Stock,  and  588,235  shares  of  Series  G  Preferred  Stock  were  issued  and
outstanding.  Shareholders  of Series A, Series B, Series C, Series D, Series E,
Series F and Series G  Preferred  Stock are not  entitled  to vote at the Annual
Meeting.  Shareholders  holding at least one-third of the outstanding  shares of
Common Stock represented in person or by proxy shall constitute a quorum for the
transaction of business at the Special Meeting.

Revocability of Proxies

         Shareholders may revoke any appointment of proxy given pursuant to this
solicitation  by delivering the Company a written notice of revocation or a duly
executed  proxy  bearing a later date or by attending  the meeting and voting in
person.  An  appointment of proxy is revoked upon the death or incapacity of the
shareholder  if the  Secretary  or other  officer of the Company  authorized  to
tabulate  votes  receives  notice of such death or  incapacity  before the proxy
exercises its authority under the appointment.

Voting and Solicitation

         Each  shareholder will be entitled to one vote for each share of Common
Stock held at the record  date.  Assuming a quorum is present,  a  plurality  of
votes cast by the shares  entitled  to vote on the  amendment  to the  Company's
Certificate of Incorporation will be required to approve the amendment.  Because
the shares of Series A,  Series B,  Series C,  Series D,  Series E, Series F and
Series G Preferred Stock are non-voting securities, the holders thereof will not
be entitled to vote at the Special Meeting.  The Company's executive offices are
located at 2355 South 1070 West, Salt Lake City, Utah. In addition to the use of
the mails, proxies may be solicited personally,  by telephone,  or by facsimile,
and the Company may reimburse  brokerage  firms and other persons holding shares
in the Company in their names or those of their  nominees  for their  reasonable
expenses in forwarding soliciting materials to the beneficial owners.




                                       1

             APPROVAL OF INCREASE IN THE NUMBER OF AUTHORIZED SHARES


                                    Proposal

         The Certificate of Incorporation  currently  authorizes the issuance of
800,000,000  shares of common stock. As of January 31, 2008,  680,984,307 shares
of common  stock were issued and  outstanding.  There have been 6,753  shares of
common  stock set aside and  reserved  in the event  that  holders  of shares of
Series A  preferred  stock elect to convert  those  shares into shares of common
stock,  10,783  shares of common  stock set aside and reserved in the event that
holders of shares of Series B preferred stock elect to convert those shares into
shares of Common  Stock,  8,750 shares of common stock set aside and reserved in
the event that  holders of shares of Series D  preferred  stock elect to convert
those  shares into shares of common  stock,  13,333  shares of common  stock set
aside and  reserved  in the event that  holders of shares of Series E  preferred
stock elect to convert  those  shares into shares of common  stock,  and 234,550
shares of common  stock set aside and  reserved  in the event  that  holders  of
shares of Series F preferred  stock elect to convert those shares into shares of
common stock,  and 588,235  shares of common stock set aside and reserved in the
event  holders of shares of Series G  preferred  stock  elect to  convert  those
shares into shares of common stock.

         Between  June 10,  1997 and January 31,  2008,  the Company  issued (i)
stock options that are currently outstanding to executive officers and employees
to purchase  9,255,000  shares of the Company's  common stock at exercise prices
ranging from $.01 per share to $2.75 per share,  and (ii) stock options that are
currently outstanding to directors to purchase 2,250,000 shares of the Company's
common  stock at  exercise  prices  from $.09 per share to $2.75 per  share.  In
addition,  between  June 10,  1997 and  January 31,  2008,  the  Company  issued
warrants to individuals and entities to purchase a total of 54,059,392 shares of
the Company's  common stock at exercise  prices  ranging from $.001 per share to
$6.75 per share.

         As a result  of the  Company's  prior  financings,  acquisitions,  note
conversions,  and  efforts to provide  incentives  to  officers,  directors  and
employees, the Board of Directors has determined that it is in the best interest
of the  Company and its  stockholders  to amend the first  paragraph  of Article
thereof numbered  "FOURTH" of the Company's  Certificate of  Incorporation  (the
"Amendment")  to increase the  authorized  shares of common stock of the Company
from  800,000,000  shares  to  1,400,000,000  shares.  The text of the  proposed
Amendment  is  attached  hereto as Exhibit I. If the  stockholders  approve  the
Amendment,  the Board of Directors intends to file an Amendment to the Company's
Certificate  of  Incorporation   reflecting  the  Amendment  with  the  Delaware
Secretary of State as soon as practicable following such stockholder approval.

         The  objective  of the increase in the number of  authorized  shares of
common stock is to insure that the Company will have sufficient shares available
for future issuances.  The Board of Directors  believes that it is necessary and
prudent  to  increase  the  authorized  number of shares of common  stock to the
proposed level in order to provide a reserve of shares available for issuance to
meet the Company's business needs as they arise. Although the Board of Directors
has no immediate  plans to issue a significant  number of  additional  shares of
common  stock,  except for shares  issuable  upon  conversion  of  $3,928,262 of
convertible  notes and the exercise of warrants and of stock options  previously
granted to the Company's officers and employees,  such future business needs may
include,  without  limitation,   funding  future  financings  and  acquisitions,
providing shares issuable upon conversion of notes and exercise of warrants, and
providing equity incentives to the Company's  officers,  directors and employees
through stock options.

Outstanding Commitments to Issue Shares

         The following table identifies the Company's outstanding commitments to
issue shares, including the shares underlying the convertible notes and warrants
issuable upon conversion of the notes and exercise of the warrants:


                                              Underlying Shares
     Security                                  of Common Stock

Notes (1)                                        3,637,280,000
Warrants (2)                                        54,059,392
Preferred Stock (3)                                    862,404
Stock Options (4)                                   11,500,000
                                              ------------------
       Total                                     3,703,701,796




                                       2



(1)      Assumes full  conversion of $3,928,262 of notes issued to AJW Partners,
         LLC,  AJW  Offshore,   Ltd.,  AJW  Qualified  Partners,  LLC,  and  New
         Millennium Capital Partners II, LLC at a conversion price of $.0018 per
         share  (based upon a market price of $.0018 as of January 14, 2008 with
         a 40% discount).
(2)      Consisting of warrants  exerciseable  at prices  ranging from $.001 per
         share to $6.75 per share,  including  warrants  issued to AJW Partners,
         LLC,  AJW  Offshore,   Ltd.,  AJW  Qualified  Partners,  LLC,  and  New
         Millennium  Capital Partners II, LLC to purchase  16,534,392  shares of
         common  stock at an  exercise  price of $.20  per  share,  exerciseable
         through the period from April 27,  2010 to June 30,  2010,  warrants to
         purchase 12,000,000 shares of common stock at an exercise price of $.10
         per share,  exerciseable  through the period from  February 28, 2011 to
         April 20, 2012,  warrants to purchase 10,000,000 shares of common stock
         at an exercise price of $.005 per share,  exerciseable through June 11,
         2012, and warrants to purchase  15,000,000 shares of common stock at an
         exercise price of $.001 per share,  exerciseable  through  December 24,
         2012.
(3)      Consisting of 6,753 shares of common stock issuable upon  conversion of
         5,627 shares of Series A preferred stock, 10,783 shares of common stock
         issuable upon  conversion of 8,986 shares of Series B preferred  stock,
         8,750 shares of common stock  issuable upon  conversion of 5,000 shares
         of Series D preferred  stock,  13,333  shares of common stock  issuable
         upon  conversion  of 250 shares of Series E  preferred  stock,  234,550
         shares of common stock issuable upon  conversion of 4,398.75  shares of
         Series F preferred  stock,  and 588,235 shares of common stock issuable
         upon conversion of 588,235 shares of Series G preferred stock.
(4)      Consisting of stock options granted to executive officers and employees
         to purchase 9,250,000 shares of common stock at exercise prices ranging
         from $.01 per share to $2.75 per share,  and stock  options  granted to
         directors  to  purchase  2,250,000  shares of common  stock at exercise
         prices ranging from $.01 per share to $2.75 per share.

         There are a total of  3,703,701,796  shares  underlying  the  Company's
convertible notes,  warrants,  preferred stock and stock options,  assuming full
conversion of the outstanding  notes and preferred stock and the exercise of all
the outstanding  warrants and stock options. The current number of the Company's
authorized  shares of common stock is  800,000,000  shares.  The large number of
shares of common stock underlying the notes, warrants, preferred stock and stock
options will require the Company to increase  the number of  authorized  shares.
Failure to obtain  stockholder  approval  to increase  the number of  authorized
shares  could result in the  noteholders  commencing  legal  action  against the
Company and foreclosing on all of its assets to recover damages. Any such action
would require the Company to curtail or cease its operations.

Callable Secured Convertible Notes and Warrants

         April 27,  2005 Sale of  $2,500,000  in  Callable  Secured  Convertible
Notes:  To obtain  funding for the  Company's  ongoing  operations,  the Company
entered into a securities  purchase agreement with four accredited  investors on
April 27,  2005 for the sale of (i)  $2,500,000  in  convertible  notes and (ii)
warrants  to purchase  16,534,392  shares of its common  stock.  The sale of the
convertible  notes and warrants  occurred in three  traunches  and the investors
provided the Company with an aggregate of $2,500,000 as follows:

o    $850,000 was disbursed on April 27, 2005;
o    $800,000  was  disbursed  on  June  23,  2005  after  the  Company  filed a
     registration  statement  on June 22, 2005 to register  the shares of common
     stock issuable upon conversion of the convertible notes and exercise of the
     warrants; and
o    $850,000  was  disbursed  on  June  30,  2005,  the  effective  date of the
     registration statement.

         Under the  terms of the  securities  purchase  agreement,  the  Company
agreed   that  it  would  not,   without   the  prior   written   consent  of  a
majority-in-interest  of the investors,  negotiate or contract with any party to
obtain  additional  equity  financing  (including  debt financing with an equity
component)  that  involves (i) the issuance of common stock at a discount to the
market  price of the common  stock on the date of issuance  (taking into account
the value of any  warrants  or  options to acquire  common  stock in  connection
therewith),  (ii) the issuance of convertible  securities  that are  convertible
into an indeterminate number of shares of common stock, or (iii) the issuance of
warrants  during the lock-up period  beginning  April 27, 2005 and ending on the
later of (A) 270 days from  April 27,  2005,  and (B) 180 days from the date the
registration statement is declared effective.

         In  addition,  the Company  agreed not to conduct any equity  financing
(including debt financing with an equity  component) during the period beginning
April 27,  2005 and ending two years after the end of the above  lock-up  period
unless it has first  provided  each  investor an option to purchase its pro-rata
share  (based  on the ratio of each  investor's  purchase  under the  securities
purchase  agreement)  of the  securities  being  offered in any proposed  equity
financing. Each investor must be provided written notice describing any proposed
equity financing at least 20 business days prior to the closing of such proposed
equity  financing  and the option must be extended to each  investor  during the
15-day period following delivery of such notice.



                                       3



         The $2,500,000 in convertible  notes bear interest at 8% per annum from
the date of issuance. Interest is computed on the basis of a 365-day year and is
payable  quarterly in cash,  with six months of interest  payable up front.  The
interest  rate resets to zero  percent for any month in which the stock price is
greater than 125% of the initial market price,  or $.0945,  for each trading day
during that month. Any amount of principal or interest on the convertible  notes
that is not paid when due will bear  interest  at the rate of 15% per annum from
the date due thereof until such amount is paid. The callable secured convertible
notes mature in three years from the date of issuance,  and are convertible into
the Company's common stock at the noteholders'  option, at the lower of (i) $.09
or (ii) 60% of the average of the three lowest  intraday  trading prices for the
common  stock on the OTC  Bulletin  Board for the 20 trading days before but not
including the conversion date.  Accordingly,  there is no limit on the number of
shares into which the notes may be converted.

         The $2,500,000 in notes are secured by the Company's assets,  including
the  Company's  inventory,   accounts  receivable  and  intellectual   property.
Moreover,  the Company has a call option under the terms of the notes.  The call
option  provides  the  Company  with the right to prepay all of the  outstanding
convertible  notes at any time,  provided  there is no event of  default  by the
Company and its stock is trading at or below $.09 per share. An event of default
includes  the  failure by the  Company to pay the  principal  or interest on the
convertible  notes  when  due or to  timely  file a  registration  statement  as
required by the Company or obtain effectiveness with the Securities and Exchange
Commission of the registration statement. Prepayment of the convertible notes is
to be made in cash equal to either  (i) 125% of the  outstanding  principal  and
accrued  interest for prepayments  occurring  within 30 days following the issue
date of the notes;  (ii) 130% of the outstanding  principal and accrued interest
for prepayments occurring between 31 and 60 days following the issue date of the
notes;  and (iii) 145% of the  outstanding  principal  and accrued  interest for
prepayments occurring after the 60th day following the issue date of the notes.

         The warrants are exercisable until five years from the date of issuance
at a purchase  price of $.20 per share.  The investors may exercise the warrants
on a cashless  basis if the shares of common stock  underlying  the warrants are
not then  registered  pursuant to an effective  registration  statement.  In the
event the investors  exercise the warrants on a cashless basis, the Company will
not receive any  proceeds  therefrom.  In addition,  the  exercise  price of the
warrants  will be  adjusted in the event the Company  issues  common  stock at a
price below market,  with the exception of any securities  issued as of the date
of the  warrants  or issued in  connection  with the  convertible  notes  issued
pursuant to the securities purchase agreement.

         The noteholders  have agreed to restrict their ability to convert their
callable secured convertible notes or exercise their warrants and receive shares
of our common  stock such that the number of shares of common stock held by them
in the aggregate and their affiliates after such conversion or exercise does not
exceed 4.99% of the then issued and outstanding shares of common stock. However,
the  noteholders  may repeatedly  sell shares of common stock in order to reduce
their ownership  percentage,  and subsequently  convert  additional  convertible
notes.

         February 28, 2006 Sale of  $1,500,000 in Callable  Secured  Convertible
Notes: To obtain additional  funding for the Company's ongoing  operations,  the
Company entered into a second securities purchase agreement on February 28, 2006
with the same  four  accredited  investors  for the  sale of (i)  $1,500,000  in
convertible notes and (ii) warrants to purchase  12,000,000 shares of its common
stock.  The sale of the  convertible  notes  and  warrants  is to occur in three
traunches  and the  investors  are  obligated  to provide  the  Company  with an
aggregate of $1,500,000 as follows:

o    $500,000 was disbursed on February 28, 2006;
o    $500,000  was  disbursed  on  June  28,  2006  after  the  Company  filed a
     registration  statement  on June 15, 2006 to register  the shares of common
     stock  underlying the convertible  notes.  The  registration  statement was
     subsequently  withdrawn on July 25, 2006 and a new  registration  statement
     was filed on  September  21, 2006 to register  60,000,000  shares of common
     stock issuable upon conversion of the convertible notes;
o    $500,000 was disbursed  on April 20, 2007, the day  prior to  the effective
     date of the registration statement on May 1, 2007.

         Under the terms of the February 28, 2006 securities purchase agreement,
the Company  agreed that it would not,  without the prior  written  consent of a
majority-in-interest  of the investors,  negotiate or contract with any party to
obtain  additional  equity  financing  (including  debt financing with an equity
component)  that  involves (i) the issuance of common stock at a discount to the
market  price of the common  stock on the date of issuance  (taking into account
the value of any  warrants  or  options to acquire  common  stock in  connection
therewith),  (ii) the issuance of convertible  securities  that are  convertible
into an indeterminate number of shares of common stock, or (iii) the issuance of
warrants during the lock-up period beginning February 28, 2006 and ending on the
later of (a) 270 days from  February 28, 2006, or (b) 180 days from the date the
registration statement is declared effective.




                                       4


         In  addition,  the Company  agreed not to conduct any equity  financing
(including debt financing with an equity  component) during the period beginning
February 28, 2006 and ending two years after the end of the above lock-up period
unless it first  provided each investor an option to purchase its pro-rata share
(based on the ratio of each  investor's  purchase under the securities  purchase
agreement) of the  securities  being offered in any proposed  equity  financing.
Each investor must be provided  written notice  describing  any proposed  equity
financing at least 20 business days prior to the closing of such proposed equity
financing  and the option must be extended  to each  investor  during the 15-day
period following delivery of such notice.

         The $1,500,000 in convertible  notes bear interest at 8% per annum from
the date of issuance. Interest is computed on the basis of a 365-day year and is
payable  quarterly in cash,  with six months of interest  payable up front.  The
interest  rate resets to zero  percent for any month in which the stock price is
greater than 125% of the initial market price,  or $.0275,  for each trading day
during that month.  Any amount of principal or interest on the callable  secured
convertible  notes that is not paid when due will bear  interest  at the rate of
15% per  annum  from  the  date due  thereof  until  such  amount  is paid.  The
convertible  notes  mature in three  years  from the date of  issuance,  and are
convertible into the Company's common stock at the noteholders'  option,  at the
lower  of (i) $.02 or (ii)  60% of the  average  of the  three  lowest  intraday
trading prices for the common stock on the OTC Bulletin Board for the 20 trading
days before but not  including the  conversion  date.  Accordingly,  there is no
limit on the number of shares into which the notes may be converted.

         The  $1,500,000  in  convertible  notes are  secured  by the  Company's
assets, including the Company's inventory,  accounts receivable and intellectual
property.  Moreover, the Company has a call option under the terms of the notes.
The call  option  provides  the  Company  with the  right to  prepay  all of the
outstanding convertible notes at any time, provided there is no event of default
by the Company and its stock is trading at or below $.02 per share.  An event of
default  includes the failure by the Company to pay the principal or interest on
the  convertible  notes when due or to timely file a  registration  statement as
required by the Company or obtain effectiveness with the Securities and Exchange
Commission of the registration statement. Prepayment of the convertible notes is
to be made in cash equal to either  (a) 125% of the  outstanding  principal  and
accrued  interest for prepayments  occurring  within 30 days following the issue
date of the notes;  (b) 130% of the outstanding  principal and accrued  interest
for prepayments occurring between 31 and 60 days following the issue date of the
notes;  or (c)  145% of the  outstanding  principal  and  accrued  interest  for
prepayments occurring after the 60th day following the issue date of the notes.

         The warrants are exercisable until five years from the date of issuance
at a purchase  price of $.10 per share.  The investors may exercise the warrants
on a cashless  basis if the shares of common stock  underlying  the warrants are
not then  registered  pursuant to an effective  registration  statement.  In the
event the investors  exercise the warrants on a cashless basis, the Company will
not receive any  proceeds  therefrom.  In addition,  the  exercise  price of the
warrants  will be  adjusted in the event the Company  issues  common  stock at a
price below market,  with the exception of any securities  issued as of the date
of the  warrants  or issued in  connection  with the  convertible  notes  issued
pursuant to the securities purchase agreement.

         The noteholders  have agreed to restrict their ability to convert their
convertible notes or exercise their warrants and receive shares of the Company's
common  stock such that the number of shares of common stock held by them in the
aggregate and their affiliates after such conversion or exercise does not exceed
4.99% of the then issued and outstanding  shares of common stock.  However,  the
noteholders  may repeatedly sell shares of common stock in order to reduce their
ownership percentage, and subsequently convert additional convertible notes.

         June 11, 2007 Sale of $500,000 in Callable Secured  Convertible  Notes:
To obtain  further  funding for the Company's  ongoing  operations,  the Company
entered  into a third  securities  purchase  agreement on June 11, 2007 with the
same four accredited  investors for the sale of (i) $500,000 in callable secured
convertible notes and (ii) warrants to purchase  10,000,000 shares of its common
stock. The investors disbursed $500,000 to the Company on June 11, 2007.

         Under the terms of the June 11, 2007 securities purchase agreement, the
Company  agreed  that it would  not,  without  the prior  written  consent  of a
majority-in-interest  of the investors,  negotiate or contract with any party to
obtain  additional  equity  financing  (including  debt financing with an equity
component)  that  involves (i) the issuance of common stock at a discount to the
market  price of the common  stock on the date of issuance  (taking into account
the value of any  warrants  or  options to acquire  common  stock in  connection
therewith),  (ii) the issuance of convertible  securities  that are  convertible
into an indeterminate number of shares of common stock, or (iii) the issuance of
warrants  during the lock-up  period  beginning  June 11, 2007 and ending on the
later of (a) 270 days  from  June 11,  2007,  or (b) 180 days  from the date the
registration statement is declared effective.



                                       5


         In  addition,  the Company  agreed not to conduct any equity  financing
(including debt financing with an equity  component) during the period beginning
June 11,  2007 and ending two years  after the end of the above  lock-up  period
unless it first  provided each investor an option to purchase its pro-rata share
(based on the ratio of each  investor's  purchase under the securities  purchase
agreement) of the  securities  being offered in any proposed  equity  financing.
Each investor must be provided  written notice  describing  any proposed  equity
financing at least 20 business days prior to the closing of such proposed equity
financing  and the option must be extended  to each  investor  during the 15-day
period following delivery of such notice.

         The $500,000 in  convertible  notes bear  interest at 8% per annum from
the date of issuance. Interest is computed on the basis of a 365-day year and is
payable  quarterly in cash,  with six months of interest  payable up front.  The
interest  rate resets to zero  percent for any month in which the stock price is
greater than 125% of the initial market price,  or $.0275,  for each trading day
during that month.  Any amount of principal or interest on the callable  secured
convertible  notes that is not paid when due will bear  interest  at the rate of
15% per  annum  from  the  date due  thereof  until  such  amount  is paid.  The
convertible  notes  mature in three  years  from the date of  issuance,  and are
convertible into the Company's common stock at the noteholders'  option,  at the
lower  of (i) $.02 or (ii)  50% of the  average  of the  three  lowest  intraday
trading prices for the common stock on the OTC Bulletin Board for the 20 trading
days before but not  including the  conversion  date.  Accordingly,  there is no
limit on the number of shares into which the notes may be converted.

         The $500,000 in convertible  notes are secured by the Company's assets,
including  the  Company's   inventory,   accounts  receivable  and  intellectual
property.  Moreover, the Company has a call option under the terms of the notes.
The call  option  provides  the  Company  with the  right to  prepay  all of the
outstanding convertible notes at any time, provided there is no event of default
by the Company and its stock is trading at or below $.10 per share.  An event of
default  includes the failure by the Company to pay the principal or interest on
the  convertible  notes when due or to timely file a  registration  statement as
required by the Company or obtain effectiveness with the Securities and Exchange
Commission of the registration statement. Prepayment of the convertible notes is
to be made in cash equal to either  (a) 125% of the  outstanding  principal  and
accrued  interest for prepayments  occurring  within 30 days following the issue
date of the notes;  (b) 130% of the outstanding  principal and accrued  interest
for prepayments occurring between 31 and 60 days following the issue date of the
notes;  or (c)  145% of the  outstanding  principal  and  accrued  interest  for
prepayments occurring after the 60th day following the issue date of the notes.

         The  warrants  are  exercisable  until  seven  years  from  the date of
issuance at a purchase price of $.005 per share.  The investors may exercise the
warrants  on a  cashless  basis if the  shares of common  stock  underlying  the
warrants  are  not  then  registered  pursuant  to  an  effective   registration
statement. In the event the investors exercise the warrants on a cashless basis,
the Company will not receive any proceeds therefrom.  In addition,  the exercise
price of the warrants  will be adjusted in the event the Company  issues  common
stock at a price below market, with the exception of any securities issued as of
the date of the  warrants or issued in  connection  with the  convertible  notes
issued pursuant to the securities purchase agreement.

         The noteholders  have agreed to restrict their ability to convert their
convertible notes or exercise their warrants and receive shares of the Company's
common  stock such that the number of shares of common stock held by them in the
aggregate and their affiliates after such conversion or exercise does not exceed
4.99% of the then issued and outstanding  shares of common stock.  However,  the
noteholders  may repeatedly sell shares of common stock in order to reduce their
ownership  percentage,  and subsequently  convert additional  convertible notes,
provided,  however,  that such  conversions  do not exceed  $75,000 per calendar
month,  or the average  daily dollar volume  calculated  during the ten business
days  prior to  conversion  multiplied  by the  number of  trading  days of that
calendar month, per calendar month.

         The  Company is required  to  register  the shares of its common  stock
issuable upon the  conversion of the  convertible  notes and the exercise of the
warrants that were issued to the noteholders pursuant to the securities purchase
agreement the Company entered in to on June 11, 2007. The registration statement
must be filed with the Securities and Exchange  Commission within 60 days of the
June 11, 2007 closing date and the  effectiveness  of the  registration is to be
within  135  days of  such  closing  date.  Penalties  of 2% of the  outstanding
principal  balance of the  convertible  notes plus  accrued  interest  are to be
applied for each month the  registration  is not  effective  within the required
time. The penalty may be paid in cash or stock at the Company's option.

         December  24, 2007 Sale of $250,000  in  Callable  Secured  Convertible
Notes:  To obtain  further  funding for the Company's  ongoing  operations,  the
Company entered into a fourth securities purchase agreement on December 24, 2007
with the same four accredited investors for the sale of (i) $250,000 in callable
secured convertible notes and (ii) warrants to purchase 15,000,000 shares of its
common stock.  The investors  disbursed  $250,000 to the Company on December 24,
2007.



                                       6


         Under the terms of the December 24, 2007 securities purchase agreement,
the Company  agreed that it would not,  without the prior  written  consent of a
majority-in-interest  of the investors,  negotiate or contract with any party to
obtain  additional  equity  financing  (including  debt financing with an equity
component)  that  involves (i) the issuance of common stock at a discount to the
market  price of the common  stock on the date of issuance  (taking into account
the value of any  warrants  or  options to acquire  common  stock in  connection
therewith),  (ii) the issuance of convertible  securities  that are  convertible
into an indeterminate number of shares of common stock, or (iii) the issuance of
warrants during the lock-up period beginning December 24, 2007 and ending on the
later of (a) 270 days from  December 24, 2007, or (b) 180 days from the date the
registration statement is declared effective.

         In  addition,  the Company  agreed not to conduct any equity  financing
(including debt financing with an equity  component) during the period beginning
December 24, 2007 and ending two years after the end of the above lock-up period
unless it first  provided each investor an option to purchase its pro-rata share
(based on the ratio of each  investor's  purchase under the securities  purchase
agreement) of the  securities  being offered in any proposed  equity  financing.
Each investor must be provided  written notice  describing  any proposed  equity
financing at least 20 business days prior to the closing of such proposed equity
financing  and the option must be extended  to each  investor  during the 15-day
period following delivery of such notice.

         The $250,000 in  convertible  notes bear  interest at 8% per annum from
the date of issuance. Interest is computed on the basis of a 365-day year and is
payable  quarterly in cash,  with six months of interest  payable up front.  The
interest  rate resets to zero  percent for any month in which the stock price is
greater than 125% of the initial market price,  or $.0275,  for each trading day
during that month.  Any amount of principal or interest on the callable  secured
convertible  notes that is not paid when due will bear  interest  at the rate of
15% per  annum  from  the  date due  thereof  until  such  amount  is paid.  The
convertible  notes  mature in three  years  from the date of  issuance,  and are
convertible into the Company's common stock at the noteholders'  option,  at the
lower  of (i) $.02 or (ii)  50% of the  average  of the  three  lowest  intraday
trading prices for the common stock on the OTC Bulletin Board for the 20 trading
days before but not  including the  conversion  date.  Accordingly,  there is no
limit on the number of shares into which the notes may be converted.

         The $250,000 in convertible  notes are secured by the Company's assets,
including  the  Company's   inventory,   accounts  receivable  and  intellectual
property.  Moreover, the Company has a call option under the terms of the notes.
The call  option  provides  the  Company  with the  right to  prepay  all of the
outstanding convertible notes at any time, provided there is no event of default
by the Company and its stock is trading at or below $.10 per share.  An event of
default  includes the failure by the Company to pay the principal or interest on
the  convertible  notes when due or to timely file a  registration  statement as
required by the Company or obtain effectiveness with the Securities and Exchange
Commission of the registration statement. Prepayment of the convertible notes is
to be made in cash equal to either  (a) 125% of the  outstanding  principal  and
accrued  interest for prepayments  occurring  within 30 days following the issue
date of the notes;  (b) 130% of the outstanding  principal and accrued  interest
for prepayments occurring between 31 and 60 days following the issue date of the
notes;  or (c)  145% of the  outstanding  principal  and  accrued  interest  for
prepayments occurring after the 60th day following the issue date of the notes.

         The  warrants  are  exercisable  until  seven  years  from  the date of
issuance at a purchase price of $.001 per share.  The investors may exercise the
warrants  on a  cashless  basis if the  shares of common  stock  underlying  the
warrants  are  not  then  registered  pursuant  to  an  effective   registration
statement. In the event the investors exercise the warrants on a cashless basis,
the Company will not receive any proceeds therefrom.  In addition,  the exercise
price of the warrants  will be adjusted in the event the Company  issues  common
stock at a price below market, with the exception of any securities issued as of
the date of the  warrants or issued in  connection  with the  convertible  notes
issued pursuant to the securities purchase agreement.

         The noteholders  have agreed to restrict their ability to convert their
convertible notes or exercise their warrants and receive shares of the Company's
common  stock such that the number of shares of common stock held by them in the
aggregate and their affiliates after such conversion or exercise does not exceed
4.99% of the then issued and outstanding  shares of common stock.  However,  the
noteholders  may repeatedly sell shares of common stock in order to reduce their
ownership  percentage,  and subsequently  convert additional  convertible notes,
provided,  however,  that such  conversions  do not exceed  $75,000 per calendar
month,  or the average  daily dollar volume  calculated  during the ten business
days  prior to  conversion  multiplied  by the  number of  trading  days of that
calendar month, per calendar month.

         The  Company is required  to  register  the shares of its common  stock
issuable upon the  conversion of the  convertible  notes and the exercise of the
warrants that were issued to the noteholders pursuant to the securities purchase
agreement  the Company  entered in to on December  24,  2007.  The  registration
statement must be filed with the Securities  and Exchange  Commission  within 60
days  of the  December  24,  2007  closing  date  and the  effectiveness  of the
registration  is to be within 135 days of such closing date.  Penalties of 2% of
the outstanding principal balance of the convertible notes plus accrued interest
are to be applied for each month the  registration  is not effective  within the
required time. The penalty may be paid in cash or stock at the Company's option.


                                       7


Simple Conversion Calculation

         The number of shares of common stock  issuable  upon  conversion of the
convertible  notes issued on April 27, 2005,  February 28, 2006,  June 11, 2007,
and December 23, 2007 is determined by dividing that portion of the principal of
the notes to be converted and interest,  if any, by the  conversion  price.  For
example,  assuming conversion of $3,928,262  principal amount of the convertible
notes on December 31, 2007  (consisting of $4,750,000 in convertible  notes that
were sold to the four investors pursuant to the securities  purchase  agreements
dated April 27, 2005,  February 28, 2006,  June 11, 2007, and December 24, 2007,
less  $1,210,748  in notes  converted  during the period  from June 12,  2005 to
December  31,  2007,  plus  $389,010 in interest  during the same  period) and a
conversion  price of $.0018  per  share with a 40% discount,  the  number of
shares  issuable  upon conversion would be:

                    $3,928,262/$.0018 = 3,703,701,796 shares.

The continuously  adjustable  conversion price feature of the convertible  notes
could  require the Company to issue a  substantially  greater  number of shares,
which will cause dilution to the existing shareholders.

         The  Company's  obligation  to  issue  shares  upon  conversion  of the
convertible  notes issued on April 27, 2005,  February 28, 2006,  June 11, 2007,
and December 24, 2007 is essentially  limitless.  The following is an example of
the  amount of shares of common  stock  that are  issuable  upon  conversion  of
$3,928,262   principal  amount  of  the  convertible  notes  (including  accrued
interest),  based on market prices 25%, 50%, and 75% below the market price,  as
of January 14, 2008 of $.0018 with a 40% discount:

% Below       Price Per       With 40%        Number of        % of Outstanding
Market          Share         Discount      Shares Issuable        Shares*
-------       ---------       --------      ---------------    ----------------
  25%          $.00135        $.00081        4,849,706,000            712%
  50%          $.0009         $.00054        7,274,559,000         10,682%
  75%          $.00045        $.00027       14,594,118,000         21,365%

*Based on 680,984,307 shares outstanding.

         As  illustrated,  the number of shares of common  stock  issuable  upon
conversion of the Company's  convertible notes will increase if the market price
of the  Company's  stock  declines,  which will cause  dilution to the Company's
existing shareholders.

The continuously  adjustable  conversion price feature of the convertible  notes
may encourage investors to make short sales in the Company's common stock, which
could have a depressive effect on the price of the Company's common stock.

         The  convertible  notes are  convertible  into shares of the  Company's
common stock at a 40% to 50%  discount to the trading  price of the common stock
prior to the conversion.  The significant  downward pressure on the price of the
common  stock as the  noteholders  convert and sell  material  amounts of common
stock  could  encourage  short  sales by  investors.  This could  place  further
downward  pressure on the price of the common stock. The noteholders  could sell
common  stock  into the market in  anticipation  of  covering  the short sale by
converting their securities,  which could cause the further downward pressure on
the stock price.  In addition,  not only could the sales of shares issuable upon
conversion  or  exercise  of  notes,  warrants  and  options,  but also the mere
perception that these sales could occur,  may adversely  affect the market price
of the common stock.

The  issuance  of shares  upon  conversion  of the  convertible  notes may cause
immediate and substantial dilution to existing shareholders.

         The issuance of shares upon conversion of convertible  notes may result
in  substantial  dilution  to the  interests  of other  shareholders  since  the
noteholders  may  ultimately  convert  and  sell  the full  amount  issuable  on
conversion.  Although the noteholders may not convert their convertible notes if
such  conversion  would  cause  them to own more  than  4.99%  of the  Company's
outstanding common stock, this restriction does not prevent the noteholders from
converting  some of  their  holdings  and  then  converting  the  rest of  their
holdings.  In this way,  the  noteholders  could sell more than this limit while
never  holding  more than this  limit.  There is no upper limit on the number of
shares that may be issued,  which will have the effect of further  diluting  the
proportionate  equity  interest  and voting  power of  holders of the  Company's
common stock.


                                       8


Vote Required and Recommendation of the Board of Directors

         The  affirmative  vote of the holders of a majority of the  outstanding
shares of the  Company's  common stock  entitled to vote at the Special  Meeting
will be  required  to  approve  the  proposed  amendment,  assuming  a quorum is
present.

         The Board of Directors recommends that shareholders vote "FOR" approval
of the amendment to the Certificate of  Incorporation  to increase the number of
authorized shares of common stock from 800,000,000 to 1,400,000,000 shares.

Because  the  Company  failed to hold an Annual  Shareholders  Meeting in fiscal
2007, the Delaware Court of Chancery may order an Annual Meeting to be held upon
request by a shareholder.

         The Company  did not hold an Annual  Meeting of the  Shareholders  (the
"Annual Meeting") for fiscal 2007 in order to avoid the costs of such a meeting,
including the cost of preparing and mailing a Proxy  Statement and Annual Report
to each of its shareholders. Under Delaware law, the Company is required to hold
an Annual Meeting each year. A failure to hold an Annual Meeting does not affect
otherwise  valid  corporate  acts or work a  forfeiture  or  dissolution  of the
Company.  Moreover, under Delaware law, directors continue to serve as directors
despite lack of an Annual  Meeting until the next Annual Meeting and until their
successors  have been elected and  qualified.  However,  if the Company fails to
hold an Annual Meeting for a period of 30 days after the date  designated in its
bylaws for the Annual  Meeting,  the  Delaware  Court of  Chancery  may order an
Annual  Meeting  to be  held  upon  the  application  of any  of  the  Company's
shareholders,  if an Annual  Meeting is  ordered  to be held by the  court,  the
Company would have to incur the costs of holding the meeting, including the cost
of preparing  and mailing the Proxy  Statement  and Annual Report to each of its
shareholders. The Company anticipates holding an Annual Meeting in 2008.

                     ANNUAL REPORT AND FINANCIAL STATEMENTS

         Shareholders  are referred to the Company's  Annual  Report,  including
financial  statements,  for the year ended  December 31, 2006, and the Company's
Quarterly Reports,  including  unaudited financial  statements,  for the periods
ended March 31, 2007,  June 30, 2007 and  September  30, 2007.  The Company will
provide without charge to each shareholder,  upon written request, a copy of the
Company's  Annual  Report on Form 10-K for the fiscal  year ended  December  31,
2006,  excluding certain exhibits thereto,  and Quarterly Reports on Form 10-QSB
for the periods  ended March 31, 2007,  June 30, 2007 and September 30, 2007, as
filed with the Securities  and Exchange  Commission.  Written  requests for such
information should be directed to Luis A. Mostacero,  Vice President of Finance,
Chief Financial Officer,  Treasurer and Secretary,  Paradigm Medical Industries,
Inc., 2355 South 1070 West, Salt Lake City, Utah 84119.

                                  OTHER MATTERS

         As of the  date  of this  Proxy  Statement,  the  Company  knows  of no
business that will be presented for  consideration  at the Special Meeting other
than the items  referred to above.  However,  if any other  matters are properly
brought before the meeting,  it is the intention of the persons named as proxies
in the accompanying  Proxy to vote the shares they represent on such business in
accordance  with their best  judgment.  In order to assure the  presence  of the
necessary  quorum and to vote on the matters to come before the Special Meeting,
please  indicate your choices on the enclosed Proxy and date, sign and return it
promptly in the postage prepaid envelope provided. The signing and delivery of a
Proxy by no means prevents one from attending the Special Meeting.

                                          By order of the Board of Directors,

                                          /s/ Luis A. Mostacero

                                          Luis A. Mostacero
                                          Vice President of Finance,
                                          Chief Financial Officer,
                                          Treasurer and Secretary
February 22, 2008.








                                       9




                        PARADIGM MEDICAL INDUSTRIES, INC.

                    PROXY FOR SPECIAL MEETING OF SHAREHOLDERS
                                 March 21, 2008

                      THIS PROXY SOLICITED ON BEHALF OF THE
                              BOARD OF DIRECTORS OF
                        PARADIGM MEDICAL INDUSTRIES, INC.

The undersigned  hereby appoints Randall A. Mackey and Raymond P.L.  Cannefax or
either of them, each with full power of substitution,  as proxies to vote at the
Special Meeting of Shareholders to be held on Friday,  March 21, 2008, beginning
at 10:00 a.m., Mountain Standard Time, at the corporate headquarters of Paradigm
Medical  Industries,  Inc. at 2355 South 1070 West, Salt Lake City, Utah, and at
all adjournments thereof, all shares of common stock which the undersigned would
be entitled to vote on matters set forth below, if personally present:

1.   APPROVAL OF AMENDMENT TO THE CERTIFICATE OF  INCORPORATION  TO INCREASE THE
     NUMBER  OF  AUTHORIZED   SHARES  OF  COMMON  STOCK  FROM   800,000,000   TO
     1,400,000,000 SHARES.

     |_|   FOR                      |_|   AGAINST             |_|   ABSTAIN

2.   IN THEIR DISCRETION, ON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
     MEETING.


THIS PROXY WHEN  PROPERLY  EXECUTED WILL BE VOTED AS DIRECTED OR, IF NO CONTRARY
DIRECTION  IS  INDICATED,  WILL  BE  VOTED  FOR  PROPOSALS  1 AND  2.  In  their
discretion,  the proxies are  authorized  to vote upon such other matters as may
properly come before the meeting or any adjournment(s) thereof.

DATED ______________________________, 2008.

SIGNATURE: ________________________________________________________________

(This proxy should be marked,  dated and signed by each  shareholder  exactly as
such shareholder's name appears hereon and returned promptly. Persons signing in
a fiduciary capacity should so indicate.  If shares are held by joint tenants or
as community property,  both should sign. If a corporation,  please sign in full
corporate  name by the president or by an  authorized  corporate  officer.  If a
partnership, please sign in partnership name by an authorized person).




                                       10


                                                                       EXHIBIT 1

                           TEXT OF PROPOSED AMENDMENT
                                       TO
                          CERTIFICATE OF INCORPORATION
                                       OF
                        PARADIGM MEDICAL INDUSTRIES, INC.


FOURTH:  The  Corporation is authorized to issue two (2) classes of shares to be
designated, respectively, "Preferred Stock" and "Common Stock." The total number
of shares of Preferred Stock authorized to be issued is five million (5,000,000)
and the total  number of shares of  Common  Stock  authorized  to be issued  one
billion four hundred million (1,400,000,000). The Preferred Stock and the Common
Stock shall each have a par value of $0.001 per share.

         The  preferences,  limitations  and  relative  rights of each  class of
shares (to the extent established hereby), and the express grant of authority to
the Board of Directors to amend this  Certificate of Incorporation to divide the
Preferred  Stock  into  series,   to  establish  and  modify  the   preferences,
limitations  and  relative  rights  of each  share of  Preferred  Stock,  and to
otherwise  impact  the  capitalization  of the  Corporation,  subject to certain
limitations  and procedures as permitted by Section 151 of the Delaware  General
Corporation Law, are as follows:

         a.   Common Stock.
              ------------

              i. Voting Rights. Except as otherwise expressly provided by law or
in this section, each outstanding share of Common Stock shall be entitled to one
(1) vote on each matter to be voted on by the shareholders of the Corporation.

              ii. Liquidation Rights. Subject to any prior or superior rights of
liquidation  as may be conferred upon any shares of Preferred  Stock,  and after
payment  or  provision  for  payment of the debts and other  liabilities  of the
Corporation,  upon any  voluntary or  involuntary  liquidation,  dissolution  or
winding up of the affairs of the  Corporation,  the holders of Common Stock then
outstanding  shall be  entitled  to  receive  all of the assets and funds of the
Corporation  remaining  and available  for  distribution.  Such assets and funds
shall be divided among and paid to the holders of shares of Common  Stock,  on a
pro-rata basis, according to the number of shares of Common Stock held by them.

              iii. Dividends. Dividends may be paid on the outstanding shares of
Common Stock as and when declared by the Board of Directors out of funds legally
available  therefore;  provided,  however,  that no dividends shall be made with
respect to the Common Stock until any preferential dividends required to be paid
or set apart for any shares of Preferred Stock have been paid or set apart.

              iv. Residual Rights. All rights accruing to the outstanding shares
of the Corporation  not expressly  provided for to the contrary herein or in the
Corporation's  Bylaws or in any amendment hereto or thereto,  shall be vested in
the Common Stock.

         b.   Preferred Stock.
              ---------------

              The Board of Directors,  without shareholder action, may amend the
Corporation's Certificate of Incorporation, pursuant to the authority granted to
the Board of  Directors  by  Subsection  102 and  within the limits set forth in
Section 151 of the Delaware General Corporation Law, to do any of the following:



                                       11

              i. designate and determine,  in whole or in part, the preferences,
limitations  and relative  rights of the Preferred  Stock before the issuance of
any shares of Preferred Stock;

              ii. create one or more series of Preferred  Stock,  fix the number
of shares of each such series  (within the total number of authorized  shares of
Preferred  Stock  available  for  designation  as a part  of  such  series)  and
designate and determine,  in whole or part,  the  preferences,  limitations  and
relative rights of each series of Preferred Stock all before the issuance of any
shares of such series;

              iii.  alter or revoke the  preferences,  limitations  and relative
rights  granted to or imposed upon the  Preferred  Stock (before the issuance of
any shares of Preferred Stock, or upon any  wholly-unissued  series of Preferred
Stock); or

              iv.  increase or decrease  the number of shares  constituting  any
series of Preferred Stock, the number of shares of which was originally fixed by
the Board of  Directors,  either  before or after the  issuance of shares of the
series, provided that the number may not be decreased below the number of shares
of such  series  then  outstanding,  or  increased  above  the  total  number of
authorized shares of Preferred Stock available for designation as a part of such
series.












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