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                                                                   Exhibit 10.20

                             1995 STOCK OPTION PLAN
                                       OF
                             U.S. TRUST CORPORATION

               AS AMENDED AND RESTATED EFFECTIVE NOVEMBER 1, 1996



1. PURPOSE

         The purpose of the 1995 Stock Option Plan of U.S. Trust Corporation is
to advance and promote the interests of U.S. Trust Corporation and its
Affiliated Companies by encouraging and enabling their officers to acquire
common shares of U.S. Trust Corporation. The Plan is intended as a means of
attracting and retaining outstanding management and promoting a close identity
of interest between management and U.S. Trust Corporation's shareholders.

2. DEFINITIONS

         As used herein, the following terms shall have the following meanings:

         "AFFILIATED COMPANIES" shall mean United States Trust Company of New
York, and each other direct or indirect subsidiary of the Corporation.

         "BENEFICIARY" shall mean the person or persons designated by an
Eligible Employee in accordance with Section 9 to exercise any Option, or to
receive any amount payable, under the Plan upon the Eligible Employee's death.

         "BOARD OF DIRECTORS" shall mean the Board of Directors of the
Corporation.

         "CHANGE IN CONTROL" shall mean that any of the following events has
occurred:

                  (i) 20% or more of the Common Shares has been acquired by any
         person (as defined by Section 3(a)(9) of the Securities Exchange Act of
         1934) other than directly from the Corporation;

                  (ii) there has been a merger or equivalent combination after
         which 49% or more of the voting shares of the surviving corporation is
         held by persons other than former shareholders of the Corporation; or
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                  (iii) 20% or more of the directors elected by shareholders to
         the Board of Directors are persons who were not nominated by the Board
         of Directors or the Executive Committee of the Board of Directors in
         the most recent proxy statement of the Corporation;

provided, however, that notwithstanding anything in the Plan to the contrary, no
Change in Control shall be deemed to have occurred, and no rights arising upon a
Change in Control as provided in Sections 5(e)(v) or 5(i) shall exist, to the
extent that the Board of Directors so directs by resolution adopted prior to the
Change in Control, or not later than 45 days after the Change in Control if the
percentage of Common Shares acquired or directors elected under clause (i) or
(iii) of the foregoing definition of Change in Control shall be at least 20% but
less than 25%. Any resolution of the Board of Directors adopted in accordance
with the provisions of this definition directing that a Change in Control shall
be deemed not to have occurred for purposes of this Plan and that Sections
5(e)(v) or 5(i) or either of such Sections shall not become effective, may be
rescinded or countermanded at any time with or without retroactive effect.

         "CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time.

         "COMMITTEE" shall mean the Compensation and Benefits Committee of the
Board of Directors.

         "COMMON SHARES" shall mean the common shares ($1.00 par value per
share) of the Corporation.

         "CORPORATION" shall mean U.S. Trust Corporation.

         "DETERMINED VALUE" shall mean (i) the highest price per Common Share
paid in connection with any Change in Control (including, without limitation,
prices paid in any subsequent merger or combination with any entity that
acquires control of the Corporation), or (ii) in the case of a Change in Control
occurring as a result of an event described in clause (iii) of the definition of
a Change in Control contained in this Section 2, the Average Market Value of a
Common Share during the 30-day period ending on the day preceding the occurrence
of such Change in Control. For this purpose, the "Average Market Value" of a
Common Share during such period shall mean the average of the mean between the
per-share high and low prices for the Corporation's Common Shares on each day
during such period, as quoted on the NASDAQ National Market System, or, if the
Corporation's Common Shares are not traded on such system, on such other
securities market or securities exchange on which such shares are traded as the
Committee shall determine.

         "ELIGIBLE EMPLOYEE" shall mean any officer of the Corporation or any of
its Affiliated Companies at or above the rank of Vice President.

         "INCENTIVE STOCK OPTION" shall mean an Option, or that portion of an
Option, that qualifies as an incentive stock option within the meaning of
section 422 of the Code.

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         "NONQUALIFIED STOCK OPTION" shall mean an Option, or portion of an
Option, that does not qualify as an Incentive Stock Option.

         "OPTION" shall mean an option to purchase Common Shares that is granted
to an Eligible Employee under the Plan.

         "OPTION HOLDER shall mean (i) any Eligible Employee to whom an Option
has been granted, or (ii) with respect to any Option held by an Eligible
Employee at the date of his or her death, the Eligible Employee's Beneficiary,
or (iii) with respect to any Option or portion thereof transferred by an
Eligible Employee to a Permitted Transferee pursuant to Section 5(f), such
Permitted Transferee.

         "PERMITTED TRANSFEREE" shall mean, with respect to any Eligible
Employee, (i) one or more members of his or her Immediate Family, (ii) a trust
solely for the benefit of the Eligible Employee and/or one or more members of
his or her Immediate Family, or (iii) a partnership or limited liability company
whose only partners or members are the Eligible Employee and/or one or more
members of his or her Immediate Family. For this purpose, members of an Eligible
Employee's "Immediate Family" shall include his or her spouse, children or
grandchildren (including adopted children and grandchildren and step-children
and step-grandchildren).

         "PLAN" shall mean the 1995 Stock Option Plan of U.S. Trust Corporation,
as set forth herein and as amended from time to time.

         "RETIREMENT" shall mean an Eligible Employee's termination of
employment with the Corporation and its Affiliated Companies for any reason
other than death if, as of the date of the Eligible Employee's termination of
employment, (i) the Eligible Employee has attained age 65 or (ii) (A) the sum of
Participant's age and the number of his or her "Years of Service", as defined in
the 401(k) Plan and ESOP of United States Trust Company of New York and
Affiliated Companies, is at least equal to 80, and (B) the Committee has
consented to treating such termination of employment as a "Retirement" for
purposes of the Plan.

         "VESTED PORTION" and "NON-VESTED PORTION" shall mean, respectively,
with respect to any Option as of any date, the portion of such Option that is
exercisable on such date, and the portion of such Option that is not exercisable
on such date, under the terms of the Plan and the Option.

3. MAXIMUM NUMBER OF COMMON SHARES AVAILABLE FOR OPTIONS

         Notwithstanding any other provision of the Plan, the aggregate number
of Common Shares that may be issued pursuant to Options granted under the Plan
after January 1, 1997 shall be limited to 750,000 Common Shares, plus that
number of Common Shares, out of the total number of Common Shares previously
approved by the Corporation's shareholders for the grant of Options hereunder,
that were not covered by Options granted prior to January 1, 1997. There shall
be added 

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to the number of Common Shares available for the grant of Options under
the Plan, as determined under the preceding sentence, the following: (i) any
Common Shares delivered (or deemed to have been delivered) after January 1, 1997
by an Option Holder to the Corporation, pursuant to the Option Holder's exercise
of any Option (whenever granted), in payment or partial payment of the purchase
price of any Common Shares covered under such Option; (ii) any Common Shares
purchased by the Corporation after January 1, 1997 on the open market with
Option Proceeds (as defined below); and (iii) any Common Shares that become no
longer subject to an Option because such Option has expired, or because the
Non-Vested Portion of such Option has been be forfeited. In the event of a
cancellation of an Option as provided in Section 5(i), the number of Common
Shares as to which such Option was cancelled shall not again become available
for use under the Plan. The limitation provided under this Section 3 shall be
subject to adjustment as provided in Section 6.

         For purposes of the preceding paragraph, "Option Proceeds" shall mean,
with respect to the exercise of any Option (whenever granted), the sum of (x)
the amount of cash received (or in the case of a cashless exercise, deemed
received) by the Corporation in payment or partial payment of the purchase price
of Common Shares pursuant to such exercise, and (y) the Tax Savings (as defined
below) realized by the Corporation attributable to such exercise. The "Tax
Savings" realized by the Corporation attributable to the exercise of any Option
shall be an amount equal to (1) the amount of the deduction allowable to the
Corporation or any of its Affiliated Companies under section 162 of the Code as
compensation attributable to the exercise of such Option, multiplied by (2) the
combined federal, state and local marginal income tax rate for the Eligible
Employee's employing company for the year of such exercise or, if such deduction
is allowable by reason of a disposition of any Common Shares acquired pursuant
to the exercise of an Incentive Stock Option that is made before the expiration
of the applicable holding periods under section 422(a) of the Code, for the year
of such disposition. Any Common Shares purchased by the Corporation on the open
market pursuant to a publicly-announced Common Share repurchase program, the
purpose of which is to acquire Common Shares for use in connection with the
Corporation's stock-based compensation plans, shall be treated as having been
purchased with Option Proceeds to the extent that (A) the Common Shares are so
purchased after the date or dates on which Option Proceeds are realized by the
Corporation and (B) the aggregate purchase price of the Common Shares so
purchased does not exceed the amount of the Option Proceeds so realized.

         The Common Shares distributed under the Plan may be authorized and
unissued shares, shares held in the treasury of the Corporation, or shares
purchased on the open market by the Corporation at such time or times and in
such manner as it may determine.

4. GRANT OF OPTIONS

         Subject to the provisions of the Plan, the Committee shall determine
and designate from time to time those Eligible Employees to whom Incentive Stock
Options, or Nonqualified Stock Options, or both, are to be granted and the
number of Common Shares that may be purchased under each Option so granted;
provided, however, that (i) the aggregate fair market value (determined at the
time the Option is granted) of the Common Shares with respect to which Incentive
Stock Options 

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are exercisable for the first time by any Eligible Employee during
any calendar year (under all incentive stock option plans of the Eligible
Employee's employer corporation and its parent and subsidiary corporations)
shall not exceed $100,000; and (ii) the total number of Common Shares with
respect to which Options may be granted to any Eligible Employee during any
calendar year shall not exceed 100,000 Common Shares.

         No Incentive Stock Option may be granted under this Plan after the
expiration of 10 years from the Effective Date of the Plan specified in Section
16, unless the shareholders of the Corporation shall have approved an extension
of the period for granting Incentive Stock Options under this Plan beyond such
date.

5. TERMS AND CONDITIONS OF OPTIONS

         Each Option granted under the Plan shall be evidenced in writing in a
form approved by the Committee, and shall contain the following terms and
conditions, and such other terms and conditions as the Committee may deem
appropriate:

         (a) OPTION TERM. Each Option shall specify the period during which the
Option may be exercised (the "Option Term"). The Option shall provide that the
Option shall expire at the end of the Option Term. The Committee may extend the
Option Term, provided, however, that in the case of any Option that the
Committee previously determined to constitute an Incentive Stock Option, no such
extension shall be made to the extent it would disqualify the Option as an
Incentive Stock Option. In no case shall the Option Term, including any such
extensions, end later than (i) ten years from the date of grant, or (ii) in the
case of Incentive Stock Options granted to an Eligible Employee who, at the time
the Incentive Stock Option is granted, owns shares possessing more than 10
percent of the total combined voting power of all classes of shares of his or
her employer corporation or of its parent or subsidiary corporation (a "Ten
Percent Shareholder"), five years from the date of grant.

         (b) PURCHASE PRICE. The price per Common Share at which Common Shares
subject to any Option may be purchased shall be determined by the Committee at
the time any Option is granted, and shall be not less than (i) the fair market
value, or (ii) in the case of Incentive Stock Options granted to a Ten Percent
Shareholder, 110 percent of the fair market value (but in no event less than the
par value) of a Common Share on the date the Option is granted, as determined by
the Committee.

         (c) EXERCISE OF OPTION. Except as otherwise provided under the Plan, no
part of any Option may be exercised until the Eligible Employee to whom the
Option was granted shall have remained in the employ of the Corporation or any
of its Affiliated Companies for such period after the date on which the Option
is granted as the Committee may specify in the Option, and the Option may
provide for exercisability in installments.

         (d) PAYMENT OF PURCHASE PRICE UPON EXERCISE. Each Option shall provide
that the purchase price of the Common Shares as to which an Option shall be
exercised shall be paid to the

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Corporation at the time of exercise either in cash or in such other
consideration as the Committee deems appropriate, including, but not limited to,
Common Shares already owned by the Option Holder having a total fair market
value, as determined by the Committee, equal to the purchase price, or a
combination of cash and Common Shares having a total fair market value, as so
determined, equal to the purchase price. The Committee in its sole discretion
may also provide that the purchase price may be paid by delivering a properly
executed exercise notice in a form approved by the Committee together with
irrevocable instructions to a broker to promptly deliver to the Corporation the
amount of the applicable sale or loan proceeds to pay the purchase price.

         (e) EXERCISE IN THE EVENT OF TERMINATION OF EMPLOYMENT OR CHANGE IN
CONTROL. In the event an Eligible Employee's employment with the Corporation and
its Affiliated Companies should terminate, or if a Change in Control should
occur, Options granted to the Eligible Employee may be exercised in accordance
with the following provisions:

                    (i) If an Eligible Employee's employment terminates as a
         result of Retirement, each Option held by the Eligible Employee, or by
         a Permitted Transferee of the Eligible Employee, at the date of the
         Eligible Employee's termination of employment may be exercised (A) with
         respect to the Vested Portion of such Option, at any time or from time
         to time during the Eligible Employee's Post-Termination Exercise Period
         (as defined below) and (B) with respect to the Non-Vested Portion of
         such Option, at any time or from time to time on or after the date or
         dates during the Eligible Employee's Post-Termination Exercise Period
         on which such portion of the Option becomes exercisable under the terms
         of the Option. If such Eligible Employee should die prior to the end of
         his or her Post-Termination Exercise Period, the Non-Vested Portion, if
         any, of each Option held by the Eligible Employee, or by a Permitted
         Transferee of the Eligible Employee, at the date of the Eligible
         Employee's death shall cease to be exercisable, and shall be forfeited,
         as of such date; and the Vested Portion of each such Option may be
         exercised by the Eligible Employee's Beneficiary, or by such Permitted
         Transferee, as the case may be, at any time or from time to time after
         the Eligible Employee's death until the earlier of the second
         anniversary of such date of death or the date on which the Option Term
         for such Option expires.

                   (ii) If an Eligible Employee's employment terminates for any
         reason other than Retirement, the Non-Vested Portion of each Option
         held by the Eligible Employee, or by a Permitted Transferee of the
         Eligible Employee, at the date of the Eligible Employee's termination
         of employment shall cease to be exercisable, and shall be forfeited, as
         of such date; and the Vested Portion of each such Option may be
         exercised at any time and from time to time during the Eligible
         Employee's Post-Termination Exercise Period. If an Eligible Employee
         whose employment has terminated as a result of permanent disability
         should die before the end of his or her Post-Termination Exercise
         Period, the Vested Portion of each Option held by the Eligible
         Employee, or by a Permitted Transferee of an Eligible Employee, at the
         date of the Eligible Employee's death shall continue to be exercisable
         by the Eligible Employee's Beneficiary, or by such Permitted
         Transferee, as the case may be, at any time or from time to time after
         the date of the Eligible Employee's death until the 

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         earlier of the second anniversary of such date of death or the date on
         which the Option Term for such Option expires.

                  (iii) Notwithstanding the foregoing, the Committee may, in its
         sole discretion, determine that any part or all of the Non-Vested
         Portion of any Option held by an Eligible Employee, or by a Permitted
         Transferee of an Eligible Employee, at the date of the Eligible
         Employee's termination of employment shall not be forfeited, and may
         continue to be exercised by the Eligible Employee (or in the event of
         his or her death by his or her Beneficiary), or by such Permitted
         Transferee, as the case may be, for such period after such date of
         termination of employment and prior to the expiration of the Option
         Term for such Option, as the Committee shall specify in such
         determination.

                   (iv) For purposes of the foregoing, an Eligible Employee's
         Post-Termination Exercise Period shall mean the period beginning on the
         date of his or her termination of employment and ending (A) on the
         fifth anniversary of such date, if the Eligible Employee's employment
         has terminated as a result of Retirement, (B) on the second anniversary
         of such date, if the Eligible Employee's employment has terminated as a
         result of his or her death, (C) on the first anniversary of such date,
         if the Eligible Employee's employment has terminated as a result of his
         or her permanent disability, (D) on the 90th day following such date,
         if the Eligible Employee's employment has terminated for any reason
         other than Retirement, death or permanent disability. Notwithstanding
         the foregoing, an Eligible Employee's Post-Termination Exercise Period
         with respect to any Option shall end no later than the date on which
         the Option Term for such Option expires.

                    (v) Notwithstanding any other provision herein to the
         contrary (but subject to the proviso contained in the definition of
         "Change in Control" in Section 2), upon the occurrence of a Change in
         Control, the Non-Vested Portion of any Option held by an Eligible
         Employee, or by a Permitted Transferee of an Eligible Employee, who is
         in the employ of the Corporation or any of its Affiliated Companies on
         the date on which such Change in Control occurs, and the Non-Vested
         Portion of any Option held on such date by any Eligible Employee, or by
         a Permitted Transferee of an Eligible Employee, whose employment
         terminated prior to such date as a result of Retirement, shall become
         immediately and fully exercisable.

         (f) NONTRANSFERABILITY OF OPTIONS. Any Option granted to an Eligible
Employee under the Plan shall be nontransferable and may be exercised during the
Eligible Employee's lifetime only by the Eligible Employee. Notwithstanding the
foregoing, any Eligible Employee may, at any time after November 1, 1996,
transfer any Nonqualified Stock Option or portion thereof to a Permitted
Transferee, subject to the following:

                  (i) such transfer shall be permitted only if the Eligible
         Employee does not receive any consideration for the transfer;

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                  (ii) such transfer shall not be effective unless and until the
         Eligible Employee has furnished the Committee with written notice of
         the transfer and copies of all documents evidencing the transfer;

                  (iii) any Option or portion thereof transferred by an Eligible
         Employee to a Permitted Transferee may be exercised by the Permitted
         Transferee to the same extent as the Eligible Employee would have been
         entitled to exercise it, and shall remain subject to all of the terms
         and conditions that would have applied to such Option under the
         provisions thereof and this Plan, if the Eligible Employee had not
         transferred the Option or portion thereof to the Permitted Transferee.

         The terms of each Option granted prior to November 1, 1996 that
prohibited the transfer of such Option shall be deemed to be automatically
amended effective as of November 1, 1996 to permit the portion of such Option
that is treated as a Nonqualified Stock Option to be transferred in accordance
with the provisions set forth above.

         (g) INVESTMENT REPRESENTATION. Each Option may provide that, upon
demand by the Committee for such a representation, the Option Holder shall
deliver to the Committee, at the time of any exercise of an Option or portion
thereof, a written representation that the shares to be acquired upon such
exercise are to be acquired for investment and not for resale or with a view to
the distribution thereof. Upon such demand, delivery of such representation
prior to the delivery of any Common Shares issued upon exercise of an Option
shall be a condition precedent to the right of the Option Holder to purchase any
Common Shares. In the event certificates are delivered for any Common Shares
with respect to which such an investment representation has been obtained, the
Committee may cause a legend or legends to be placed on such certificates to
make appropriate reference to such representation and to restrict transfer in
the absence of compliance with applicable federal or state securities laws.

         (h) OTHER OPTION PROVISIONS. Each Option may contain such other
provisions, not inconsistent with the provisions of the Plan, as the Committee
may, from time to time, determine. Without limiting the foregoing, the Committee
may require an Eligible Employee to agree, as a condition to receiving an
Option, that part or all of any Options previously granted to such Eligible
Employee be terminated; and the Committee may include in any Option provisions
under which the Option (including the Vested Portion thereof) may be cancelled
by the Corporation at any time, and the right to exercise such Option will
thereupon be forfeited, in the event that the Committee determines that: (i) the
Eligible Employee has committed fraud, embezzlement or other act of dishonesty
involving the Corporation or any of its Affiliated Companies, (ii) the Eligible
Employee's employment has been terminated as a result of discharge for cause,
(iii) the Eligible Employee has at any time furnished or divulged to any other
person, corporation or business entity, or has himself or herself used, any
information of a proprietary nature owned by the Corporation or any of its
Affiliated Companies that is in the nature of confidential business information
or trade secrets, other than as required in the course of his or her employment
by the Corporation or any of its Affiliated Companies, (iv) the Eligible
Employee has at any time induced or attempted to induce 

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any officer of the Corporation or any of its Affiliated Companies to terminate
such officer's employment with the Corporation or any of its Affiliated
Companies; (v) the Eligible Employee has at any time induced or attempted to
induce any customer of, or any other person or entity having business relations
with the Corporation or any of its Affiliated Companies to terminate or curtail
such relationship with the Corporation or any of its Affiliated Companies; or
(vi) the Eligible Employee has at any time engaged in any other conduct directly
and materially detrimental to the business of the Corporation or any of its
Affiliated Companies. Each Option shall also specify that the Option granted
thereunder shall be subject to all applicable provisions of the Plan.

         (i) CANCELLATION OF OPTIONS UPON A CHANGE IN CONTROL. Upon the
occurrence of a Change in Control, all Options that have not been fully
exercised, or that have not expired or that have not been forfeited, prior to
the date of such Change in Control shall be cancelled. In the event of any such
cancellation, the Corporation's obligation in respect of each such Option shall
be discharged by payment to the Option Holder of a single cash lump sum (reduced
by any taxes withheld pursuant to Section 8) in an amount equal to the excess,
if any, of the Determined Value of the Common Shares subject to the Option or
portion thereof so cancelled over the aggregate purchase price of such shares as
set forth in the Option. All such amounts shall be payable as soon as
practicable following the Change in Control. In the case of any such Option that
is to become exercisable in full upon the occurrence of a Change in Control
pursuant to Section 5(e)(v) above, the holder of such Option shall be provided
an opportunity to exercise such option at such time prior to the time the Change
in Control becomes effective, and in accordance with such procedures, as the
Committee shall determine in its discretion.

6. CERTAIN ADJUSTMENTS TO PLAN SHARES

         In the event of any change in the Common Shares by reason of any stock
dividend, recapitalization, reorganization, merger, consolidation, split-up,
combination or exchange of shares, or any rights offering to purchase Common
Shares at a price substantially below fair market value, or any similar change
affecting the Common Shares, the number and kind of shares available for the
grant of Options, and the number and kind of shares subject to outstanding
Options and the purchase price per share thereof shall be appropriately adjusted
consistent with such change in such manner as the Committee, in its sole
discretion, may deem equitable to prevent substantial dilution or enlargement of
the rights granted to, or available for, Option Holders hereunder. Any
adjustment of an Incentive Stock Option pursuant to this Section shall be made
only to the extent it would not constitute a "modification" of such Option
within the meaning of section 424(h)(3) of the Code. The Committee shall give
notice to each Option Holder of any adjustment made pursuant to this Section
and, upon such notice, such adjustment shall be effective and binding for all
purposes.

7. LISTING AND QUALIFICATION OF COMMON SHARES

         The Corporation, in its discretion, may postpone the issuance,
delivery, distribution or release of Common Shares upon any exercise of an
Option until completion of such stock exchange listing or other qualification of
such shares under any state or federal law, rule or regulation as the

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Corporation may consider appropriate, and may require any Option Holder to make
such representations and furnish such information as it may consider appropriate
in connection with the issuance or delivery of the shares in compliance with
applicable laws, rules and regulations.

8. TAXES

         The Corporation or any of its Affiliated Companies may make such
provisions and take such steps as it may deem necessary or appropriate for the
withholding of all federal, state and local taxes required by law to be withheld
with respect to Options granted under the Plan and the exercise thereof
including, but not limited to (i) deducting the amount so required to be
withheld from any other amount then or thereafter payable to an Option Holder,
and/or (ii) requiring an Option Holder to pay to the Corporation or any of its
Affiliated Companies the amount so required to be withheld as a condition of the
issuance, delivery, distribution or release of any Common Shares.

9. DESIGNATION AND CHANGE OF BENEFICIARY

         Each Eligible Employee to whom an Option has been granted shall file
with the Committee a written designation of one or more persons as the
Beneficiary who shall be entitled to exercise any Options, or to receive any
amount payable, under the Plan upon his or her death. An Eligible Employee may,
from time to time, revoke or change his or her Beneficiary designation without
the consent of any previously designated Beneficiary by filing a new designation
with the Committee. The last such designation received by the Committee shall be
controlling; provided, however, that no designation, or change or revocation
thereof, shall be effective unless received by the Committee prior to the
Eligible Employee's death, and in no event shall it be effective as of a date
prior to such receipt. If at the date of an Eligible Employee's death, there is
no designation of a Beneficiary in effect for the Eligible Employee pursuant to
the provisions of this Section 9, or if no Beneficiary designated by the
Eligible Employee in accordance with the provisions hereof survives to exercise
any Options that become exercisable, or to receive any amount that becomes
payable, under the Plan by reason of the Eligible Employee's death, the Eligible
Employee's estate shall be treated as the Eligible Employee's Beneficiary for
all purposes.

10. PAYMENTS TO PERSONS OTHER THAN OPTION HOLDER

         If the Committee shall find that any Option Holder to whom any amount,
or any Common Shares, is payable under the Plan is unable to care for his or her
affairs because of illness, accident or legal incapacity, then if the Committee
so directs, such amount, or such Common Shares, may be paid to such Option
Holder's spouse, child or other relative, an institution maintaining or having
custody of such person, or any other person deemed by the Committee to be a
proper recipient on behalf of such Option Holder, unless a prior claim therefor
has been made by a duly appointed legal representative of the Option Holder. Any
payment made under this Section 10 shall be a complete discharge of the
liability of the Corporation with respect to such payment.

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11. RIGHTS OF OPTION HOLDERS

         An Option Holder's rights and interests under the Plan shall be subject
to the following provisions:

         (a) An Option Holder shall have the status of a general unsecured
creditor of the Corporation with respect to his or her right to receive any
payment under the Plan. The Plan shall constitute a mere promise by the
Corporation to make payments in the future of the benefits provided for herein.
It is intended that the arrangements reflected in this Plan for the making of
any payment required to be made hereunder shall be treated as unfunded for tax
purposes, as well as for purposes of any applicable provisions of Title I of
ERISA.

         (b) An Option Holder's rights to any payment under the Plan shall not
be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment, or garnishment by creditors of the
Option Holder or his or her beneficiary.

         (c) Neither the Plan nor any action taken hereunder shall be construed
as giving any Option Holder any right to be retained in the employment of the
Corporation or any of its Affiliated Companies.

         (d) An Option Holder shall not have any rights as a shareholder with
respect to any Common Shares that are subject to any Option held by the Option
Holder prior to the date as of which such shares are issued to the Option Holder
pursuant to his or her exercise of such Option.

12. ADMINISTRATION

         The Plan shall be administered by the Committee. A majority of the
members of the Committee shall constitute a quorum. The Committee may act at a
meeting, including a telephone meeting, by action of a majority of the members
present, or without a meeting by unanimous written consent. In addition to the
responsibilities and powers assigned to the Committee elsewhere in the Plan, the
Committee shall have the authority, in its discretion but subject to the
provisions of the Plan,:

                  (i) to select the Eligible Employees to whom Options are to be
         granted;

                  (ii) to determine the number of shares to be covered by each
         Option granted, the time or times when and the manner in which each
         Option may be exercised, and the purchase price per share at which each
         Option shall be exercised;

                  (iii) to determine whether an Option that is granted to an
         Eligible Employee shall constitute a Nonqualified Stock Option or an
         Incentive Stock Option;

                  (iv) to amend any Option, with the consent of the Option
         Holder; and

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<PAGE>   12
                  (v) establish from time to time guidelines or regulations for
         the administration of the Plan, interpret the Plan, cause appropriate
         records to be established, and make all determinations and take all
         other actions considered necessary or advisable for the administration
         of the Plan.

         The Committee may delegate any ministerial or nondiscretionary function
pertaining to the administration of the Plan to any one or more officers of the
Corporation. All decisions, actions or interpretations of the Committee under
the Plan shall be final, conclusive and binding upon all parties.

         No member of the Committee shall be personally liable by reason of any
contract or other instrument executed by such member or on his or her behalf in
his or her capacity as a member of the Committee nor for any mistake of judgment
made in good faith, and the Corporation shall indemnify and hold harmless each
member of the Committee, and each employee, officer, director or trustee of the
Corporation or any of its Affiliated Companies to whom any duty or power
relating to the administration or interpretation of the Plan may be allocated or
delegated, against any cost or expense (including counsel fees) or liability
(including any sum paid in settlement of a claim with the approval of the Board
of Directors) arising out of any act or omission to act in connection with the
Plan unless arising out of such person's own fraud or bad faith.

13. AMENDMENT OR TERMINATION

         Except as to matters that in the opinion of the Corporation's legal
counsel require shareholder approval, any provision of the Plan may be modified
as to an Option Holder by an individual agreement approved by the Board of
Directors. The Board of Directors may, with prospective or retroactive effect,
amend, suspend or terminate the Plan or any portion thereof at any time;
provided, however, that (i) no amendment that would materially increase the cost
of the Plan to the Corporation may be made by the Board of Directors without the
approval of the shareholders of the Corporation and (ii) no amendment,
suspension or termination of the Plan shall deprive any Option Holder of any
rights to Options previously granted under the Plan without his or her written
consent. Any amendment that the Board of Directors would be permitted to make
pursuant to the preceding sentence may also be made by the Committee where
appropriate to facilitate the administration of the Plan or to comply with
applicable law or any applicable rules and regulations of government
authorities.

14. SUCCESSOR CORPORATION

         The obligations of the Corporation under the Plan shall be binding upon
any successor corporation or organization resulting from the merger,
consolidation or other reorganization of the Corporation, or upon any successor
corporation or organization succeeding to substantially all of the assets and
business of the Corporation. The Corporation agrees that it will make
appropriate provision for the preservation of Option Holders' rights under the
Plan in any agreement or plan

                                      -12-
<PAGE>   13
which it may enter into or adopt to effect any such merger, consolidation,
reorganization or transfer of assets.

15. GOVERNING LAW

         The Plan shall be governed by and construed in accordance with the laws
of the State of New York, without reference to the principles of conflicts of
law thereof.

16. EFFECTIVE DATE

         The Plan was adopted effective as of September 1, 1995. The amendments
to Section 3 reflected in this restatement of the Plan shall be effective as of
January 1, 1997, subject, however, to approval by the holders of a majority of
the outstanding Common Shares of the Corporation entitled to vote thereon at the
annual meeting of the Corporation's shareholders to be held on April 22, 1997.
The Committee may grant Options as provided herein prior to such shareholder
approval, subject to such approval being obtained at such meeting. All other
amendments reflected in this restatement of the Plan shall be effective as of
November 1, 1996.

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