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                                AMENDMENT NO. 1
                            TO EMPLOYMENT AGREEMENT



         Amendment No. 1 dated as of August 18, 1994 (the "Amendment") to the
Employment Agreement referred to below between Axe-Houghton Associates, Inc.
(the "Company") and Seth M. Lynn, Jr. ("Employee").


                              W I T N E S S E T H


         WHEREAS, the Company and Employee are parties to the Employment
Agreement, dated April 8, 1993 (the "Employment Agreement") (unless otherwise
defined herein, all capitalized terms used herein shall have the same meaning
as set forth in the Employment Agreement);


         WHEREAS, the Company plans to hire certain additional employees from
time to time (through acquisitions or otherwise) and wishes to make certain
amendments to the Employment Agreement to exclude from the calculation of Bonus
revenues generated by such parties consistent with the Purchase Agreement dated
as of February 18, 1993 (the "Purchase Agreement") among Hoenig Group Inc.
("Hoenig"), the Company, and the Sellers (as defined below), as amended by
Amendment No. 1 to the Purchase Agreement, dated as of August 18, 1994 among
Hoenig, the Company and the Sellers (as defined below);


         NOW THEREFORE, the parties hereto hereby agree as follows:


                                   ARTICLE I
                                   AMENDMENT


         Section 1.01. Amendment of Employment Agreement. The Employment
Agreement is hereby amended as follows:


         (a) Section 1(i) is hereby deleted and replaced in its entirety by the
following:


                  (i) "Net Pre-tax Profits" means the amount, if any,
         determined in accordance with GAAP consistently applied from year to
         year, by which the Company's total revenues generated by the Included
         Accounts (but excluding revenues generated by the Excluded Accounts)
         exceed expenses incurred in the operation and conduct of the Company's
         business excluding all such expenses relating to the Excluded Accounts
         and Excluded Employees as determined in good faith by the Board of
         Directors of the Company, which expenses include but are not limited
         to rent (at Hoenig's cost per square foot), telephones, salaries, any
         amounts paid to Company employees upon termination of employment,
         consulting, solicitation or other fees paid to third parties, business
         travel and entertainment expenses, legal and professional fees
         incurred in connection with Company business, and any other direct
         expenses incurred by the Company; provided, 


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         however, that the following expenses shall not be deducted from the
         Company's revenues when calculating the Earnout; (i) general corporate
         allocations or charges by Hoenig; (ii) interest paid on the Company
         Note referred to in Section 1.6 of the Purchase Agreement; (iii) any
         expenses reasonably incurred in the relocation of the Company's
         offices to Royal Executive Park, 4 International Drive, Rye Brook, New
         York of up to a maximum $100,000, including but not limited to any
         expenses incurred in the subletting of the Company's present premises
         located at 580 White Plains Road, Tarrytown, New York, and charges on
         service contracts incurred solely as a result of the relocation; (iv)
         the cost of any stock options granted to Company employees; (v) for
         each of the first two years following the Closing, marketing expenses
         of up to $500,000 provided such expenses are approved for
         reimbursement by Hoenig as provided in Section 1.5 of the Purchase
         Agreement; (vi) the incurrence of any indebtedness or contractual
         obligation which is outside the ordinary course of business and is in
         excess of $50,000; (vii) the compromise, settlement or other
         forgiveness of indebtedness owed to the Company which involves an
         amount in excess of $50,000; (viii) the guarantee or assumption of
         liability, contingent or otherwise, with respect to obligations of
         third parties which involves an amount in excess of $50,000; and (ix)
         interest paid on the Marketing Note referred to in Section 1.5(c)(i)
         of the Purchase Agreement.


         (b) Section 1 is hereby amended by adding the following after clause
(o):


                  (p) "Included Accounts" shall mean client accounts presently
         or hereafter managed by the Included Employees, except those client
         accounts managed using the Vortex Investment style.


                  (q) "Included Employees" shall mean the Sellers and such
         present and future employees hired by the Sellers and working with the
         Sellers on Included Accounts.


                  (r) "Excluded Accounts" shall mean client accounts presently
         or hereafter managed by employees other than the Included Employees.


                  (s) "Excluded Employees" shall mean present and future
         employees other than the Included Employees.


                  (t) "Sellers" shall mean Ellen W. Adnopoz, Lloyd Buchanan,
         Richard Franks, Robin N. Kerr, Seth M. Lynn, Jr., Porter H. Sutro and
         Robert A. Windsor, collectively.


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                                  ARTICLE II
                                 MISCELLANEOUS


         (a) The parties hereby agree that upon the commencement of employment
of the Excluded Employees all responsibilities relating to client accounts
managed using the Vortex investment style shall become the responsibility of
the Excluded Employees.


         (b) Except for the matters specifically amended herein, the Employment
Agreement shall remain and continue to be in full force and effect in
accordance with its terms, and the Employment Agreement is hereby ratified,
confirmed and acknowledged by each party thereto.


         (c) This Amendment may be executed in any number of counterparts and
by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original, and all of which
taken together shall constitute one and the same instrument.


         (d) This Amendment shall be governed by, and construed in accordance
with the laws of the State of New York, without regard to principles of
conflict of laws.


         IN WITNESS WHEREOF, the parties have caused this Amendment to be
executed as of the date first above written.


                                                   AXE-HOUGHTON ASSOCIATES, INC.


                                                   By: /s/ Richard Franks
                                                     -------------------------
                                                       Vice-President

                                                   Employee:



                                                   /s/ Seth M. Lynn, Jr.
                                                   -------------------------
                                                         Seth M. Lynn, Jr.



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