Document:

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                        AMENDMENT TO EMPLOYMENT AGREEMENT

     This AMENDMENT TO EMPLOYMENT AGREEMENT (this "Amendment"), effective as of
March 14, 2002, by and between Insignia Financial Group, Inc., a Delaware
corporation (the "Company"), and FRANK M. GARRISON (the "Executive").

     WHEREAS, the Executive is presently employed by the Company pursuant to an
Employment Agreement between the Company and the Executive, entered into on
August 1, 2000 (the "Agreement"); and

     WHEREAS, the Executive and the Company desire to amend the Agreement as
hereinafter set forth.

     NOW, THEREFORE, for good and valuable consideration, the Executive and the
Company agree as follows:

     1. DEFINED TERMS. All capitalized terms used but not otherwise defined
herein shall have the meanings ascribed thereto in the Agreement.

     2. AMENDMENT TO SECTION 1 OF THE AGREEMENT. Section 1 of the Agreement is
amended as follows:

         (a) "2002" is replaced with "2005", thereby defining the Expiration
Date as December 31, 2005, subject to earlier termination as set forth in the
Agreement, and requiring the referenced notice, if any, to be given at least six
(6) months prior to December 31, 2005; and

         (b) as of January 1, 2003, the "Effective Date" shall be defined as
"January 1, 2003". Accordingly, all benefits, consideration, restrictions and/or
obligations with a duration measured from the Effective Date shall thereafter be
measured from January 1, 2003.

     3. OPTIONS. The Company hereby affirms its conditional grant to the
Executive of an option pursuant to the Insignia Financial Group, Inc. 1998 Stock
Incentive Plan to purchase One Hundred Thousand (100,000) shares of the Class A
Common Stock, par value $.01 per share, of Insignia Financial Group, Inc.
However, this grant will only be effective subject to, and upon the Executive's
execution of, a Stock Option Agreement in the form annexed hereto as Exhibit A.

     4. RETENTION BONUS. The Executive shall be paid a retention bonus in the
amount of $500,000, to be paid in a manner and at a time (in one or more
installments) as shall be mutually agreed by the Executive and the Company.

     5. AFFIRMATION. Except as amended hereby, the Agreement shall remain in
full force and effect.

     6. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

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     7. GOVERNING LAW. This Amendment shall be governed by and construed in
accordance with the laws of the State of New York, without reference to the
conflict of law provisions thereof.

     IN WITNESS WHEREOF the parties have executed this Amendment below as of the
day first above written.

                                    INSIGNIA FINANCIAL GROUP, INC.

                                    By: /s/ Adam B. Gilbert
                                        ---------------------------------------

                                    Name: Adam B. Gilbert
                                         --------------------------------------

                                    Title: Executive Vice President
                                          -------------------------------------

                                    /s/ Frank M. Garrison
                                    -------------------------------------------
                                                FRANK M. GARRISON

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                                    AGREEMENT

     AGREEMENT (the "Agreement"), effective as of March 14, 2002, by and among
INSIGNIA FINANCIAL GROUP, INC., a Delaware corporation (the "Company"), and
FRANK M. GARRISON ("Garrison").

     WHEREAS, Garrison is presently employed by the Company pursuant to an
Employment Agreement between the Company and Garrison, entered into on August 1,
2000 (the "Garrison Employment Agreement");

     WHEREAS, the Company desires to extend the term of the Garrison Employment
Agreement pursuant to a written amendment to be mutually agreed upon by the
respective parties hereto (the "Amendment"); and

     WHEREAS, in consideration of, and as an inducement to, Garrison entering
into the Amendment with the Company, the Company has agreed to grant to Garrison
a contingent retention bonus in accordance with the terms and conditions set
forth in this Agreement.

     NOW, THEREFORE, for good and valuable consideration, Garrison and the
Company agree as follows:

     8. DEFINED TERMS. All capitalized terms used but not otherwise defined
herein shall have the meanings ascribed thereto in the Garrison Employment
Agreement.

     9. BONUS.

         The Company agrees to pay to Garrison a contingent bonus of $500,000,
payable in installments from, and to the extent of, any Net Promote Proceeds (as
defined below) within a reasonable time after such Net Promote Proceeds are
received by the Company from time to time.

     10. NET PROMOTE PROCEEDS.

         For purposes of this Agreement, the term "Net Promote Proceeds" shall
mean 33.5% of the aggregate proceeds, actually received by the Company, if any,
from its promote participations in the Insignia Opportunity Partners and/or
Insignia Opportunity Partners II (collectively, the "Opportunity Partnerships")
until Garrison has received his full $500,000 bonus, subject to Section 4
hereof. For the avoidance of doubt, the parties hereto acknowledge and agree
that the bonus to be paid to Garrison in accordance with this Agreement is
contingent upon the Company actually receiving promote proceeds from the
Opportunity Partnerships, and then only in accordance with the percentage set
forth in this section 3. The Net Promote Proceeds shall not include any return
the Company earns on any actual investment by the Company in the Opportunity
Partnerships nor any fees received by the Company in respect of acquisition or
asset management services.

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     11. BONUS TERMINATION.

         Notwithstanding anything to the contrary contained herein, no payments
shall be paid to Garrison following the date his employment with the Company (or
his engagement as a consultant with Company, as provided in Section 2(d) of the
Garrison Employment Agreement) is terminated as a result of (i) a voluntary
termination (other than a termination upon the occurrence of an Extraordinary
Transaction, Influence Change Event or an Extraordinary Stock Event); or (ii) a
Termination for Cause (as those terms are defined in the Garrison Employment
Agreement).

     12. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

     13. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without reference to the
conflict of law provisions thereof.

         IN WITNESS WHEREOF the parties have executed this Agreement below as of
the day first above written.

                                         INSIGNIA FINANCIAL GROUP, INC.

                                         By: /s/ Adam B. Gilbert
                                             -----------------------------------

                                         Name: Adam B. Gilbert
                                              ----------------------------------

                                         Title: Executive Vice President
                                               ---------------------------------

                                         /s/ Frank M. Garrison
                                         ---------------------------------------
                                                   FRANK M. GARRISON

                                       4<PAGE>

                         INSIGNIA FINANCIAL GROUP, INC.

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

                            1998 STOCK INCENTIVE PLAN
                   (AMENDED AND RESTATED AS OF APRIL 8, 2002)

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

                                    ARTICLE I

                                     PURPOSE

     The purpose of this Insignia Financial Group, Inc. 1998 Stock Incentive
Plan (Amended and Restated as of April 8, 2002) is to enhance the profitability
and value of the Company for the benefit of its stockholders by enabling the
Company (i) to offer employees of and Consultants to the Company and its
Affiliates stock-based incentives and other equity interests in the Company,
thereby creating a means to raise the level of stock ownership by employees and
Consultants in order to attract, retain and reward such individuals and
strengthen the mutuality of interests between such individuals and the Company's
stockholders, and (ii) to make equity based awards to Non-Employee Directors,
thereby creating a means to attract, retain and reward such Non-Employee
Directors and strengthen the mutuality of interests between Non-Employee
Directors and the Company's stockholders.

                                   ARTICLE II

                                   DEFINITIONS

     For purposes of this Plan, the following terms shall have the following
meanings:

     2.1 "Acquisition Event" has the meaning set forth in Section 4.2(d).

     2.2 "Affiliate" means each of the following: (i) any Subsidiary; (ii) any
Parent; (iii) any corporation, trade or business (including, without limitation,
a partnership or limited liability company) which is directly or indirectly
controlled 50% or more (whether by ownership of stock, assets or an equivalent
ownership interest or voting interest) by the Company or one of its Affiliates;
and (iv) any other entity in which the Company or any of its Affiliates has a
material equity interest and which is designated as an "Affiliate" by resolution
of the Committee.

     2.3 "Award" means any award under this Plan of any: (i) Stock Option; (ii)
Stock Appreciation Right; (iii) Restricted Stock; (iv) Performance Share; (v)
Performance Unit; (vi) Other Stock-Based Award; or (vii) other award providing
benefits similar to (i) through (vi) designed to meet the requirements of a
Foreign Jurisdiction.

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     2.4 "Board" means the Board of Directors of the Company.

     2.5 "Cause" means, with respect to a Participant's Termination of
Employment or Termination of Consultancy: (i) in the case where there is no
employment agreement, consulting agreement, change in control agreement or
similar agreement in effect between the Company or an Affiliate and the
Participant at the time of the grant of the Award (or where there is such an
agreement but it does not define "cause" (or words of like import)), termination
due to a Participant's insubordination, dishonesty, incompetence, moral
turpitude, other misconduct of any kind or the refusal to perform his or her
duties or responsibilities for any reason other than illness or incapacity; or
(ii) in the case where there is an employment agreement, consulting agreement,
change in control agreement or similar agreement in effect between the Company
or an Affiliate and the Participant at the time of the grant of the Award that
defines "cause" (or words of like import), as defined under such agreement;
provided, however, that with regard to any agreement that conditions "cause" on
occurrence of a change in control, such definition of "cause" shall not apply
until a change in control actually takes place and then only with regard to a
termination thereafter. With respect to a Participant's Termination of
Directorship, "cause" shall mean an act or failure to act that constitutes cause
for removal of a director under applicable Delaware law.

     2.6 "Change in Control" has the meaning set forth in Article XIII or
Article XIV, as applicable.

     2.7 "Code" means the Internal Revenue Code of 1986, as amended. Any
reference to any section of the Code shall also be a reference to any successor
provision.

     2.8 "Committee" means: (a) with respect to the application of this Plan to
Eligible Employees and Consultants, a committee or subcommittee of the Board
appointed from time to time by the Board, which committee or subcommittee shall
consist of two or more non-employee directors, each of whom is intended to be,
to the extent required by Rule 16b-3, a "non-employee director" as defined in
Rule 16b-3 and, to the extent required by Section 162(m) of the Code and any
regulations thereunder, an "outside director" as defined under Section 162(m) of
the Code; provided, however, that if and to the extent that no Committee exists
which has the authority to administer this Plan, the functions of the Committee
shall be exercised by the Board and all references herein to the Committee shall
be deemed to be references to the Board; and (b) with respect to the application
of this Plan to Non-Employee Directors, the Board.

     2.9 "Common Stock" means the common stock, $.01 par value per share, of the
Company.

     2.10 "Company" means Insignia Financial Group, Inc., a Delaware
corporation, and its successors by operation of law. Prior to November 2, 1998,
the Company was known as Insignia/ESG Holdings, Inc.

     2.11 "Consultant" means any advisor or consultant to the Company or its
Affiliates.

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     2.12 "Disability" means, with respect to an Eligible Employee, Consultant
or Non- Employee Director, a permanent and total disability as defined in
Section 22(e)(3) of the Code. A Disability shall only be deemed to occur at the
time of the determination by the Committee of the Disability.

     2.13 "Distribution Date" means the date of distribution of Common Stock by
Insignia Financial Group, Inc. to holders of Class A Common Stock, par value
$.01 per share, of Insignia Financial Group, Inc.

     2.14 "Effective Date" means the effective date of this Plan as defined in
Article XVIII.

     2.15 "Eligible Employee" means each employee of the Company or an
Affiliate.

     2.16 "Exchange Act" means the Securities Exchange Act of 1934, as amended.
Any references to any section of the Exchange Act shall also be a reference to
any successor provision.

     2.17 "Fair Market Value" means, unless otherwise required by any applicable
provision of the Code or any regulations issued thereunder, as of any date, the
last sales price for the Common Stock on the applicable date: (i) as reported on
the principal national securities exchange on which it is then traded or the
Nasdaq Stock Market, Inc. or (ii) if not traded on any such national securities
exchange or the Nasdaq Stock Market, Inc. as quoted on an automated quotation
system sponsored by the National Association of Securities Dealers, Inc. If the
Common Stock is not readily tradable on a national securities exchange, the
Nasdaq Stock Market, Inc. or any automated quotation system sponsored by the
National Association of Securities Dealers, Inc., its Fair Market Value shall be
set in good faith by the Committee. Notwithstanding anything herein to the
contrary, "Fair Market Value" means the price for Common Stock set by the
Committee in good faith based on reasonable methods set forth under Section 422
of the Code and the regulations thereunder including, without limitation, a
method utilizing the average of prices of the Common Stock reported on the
principal national securities exchange on which it is then traded during a
reasonable period designated by the Committee. For purposes of the grant of any
Stock Option, the applicable date shall be the date for which the last sales
price is available at the time of grant. For purposes of the conversion of a
Performance Unit to shares of Common Stock for reference purposes, the
applicable date shall be the date determined by the Committee in accordance with
Section 10.1. For purposes of the exercise of any Stock Appreciation Right, the
applicable date shall be the date a notice of exercise is received by the
Committee or, if not a day on which the applicable market is open, the next day
that it is open.

     2.18 "Foreign Jurisdiction" means any jurisdiction outside of the United
States including, without limitation, countries, states, provinces and
localities.

     2.19 "Incentive Stock Option" means any Stock Option awarded to an Eligible
Employee under this Plan intended to be and designated as an "Incentive Stock
Option" within the meaning of Section 422 of the Code.

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     2.20 "Limited Stock Appreciation Right" means an Award of a limited Tandem
Stock Appreciation Right or a Non-Tandem Stock Appreciation Right made pursuant
to Section 7.5 of this Plan.

     2.21 "Non-Employee Director" means a director of the Company who is not an
active employee of the Company or an Affiliate and who is not an officer,
director or employee of (i) any entity which, directly or indirectly,
beneficially owns or controls 5% or more of the combined voting power of the
then outstanding voting securities of the Company (or any Subsidiary) entitled
to vote generally in the election of directors of the Company (or, if
applicable, the Subsidiary) or (ii) any entity controlling, controlled by or
under common control (within the meaning of Rule 405 of the Securities Act) with
any such entity.

     2.22 "Non-Qualified Stock Option" means any Stock Option awarded under this
Plan that is not an Incentive Stock Option.

     2.23 "Non-Tandem Stock Appreciation Right" means a Stock Appreciation Right
entitling a Participant to receive an amount in cash or Common Stock (as
determined by the Committee in its sole discretion) equal to the excess of: (i)
the Fair Market Value of a share of Common Stock as of the date such right is
exercised, over (ii) the aggregate exercise price of such right.

     2.24 "Other Stock-Based Award" means an Award of Common Stock and other
Awards made pursuant to Article XI that are valued in whole or in part by
reference to, or are payable in or otherwise based on, Common Stock, including,
without limitation, an Award valued by reference to performance of an Affiliate.

     2.25 "Parent" means any parent corporation of the Company within the
meaning of Section 424(e) of the Code.

     2.26 "Participant" means any Eligible Employee or Consultant to whom an
Award has been made under this Plan and each Non-Employee Director of the
Company; provided, however, that a Non-Employee Director shall be a Participant
for purposes of the Plan solely with respect to awards of Stock Options pursuant
to Article XIII.

     2.27 "Performance Criteria" has the meaning set forth in Exhibit A.

     2.28 "Performance Cycle" has the meaning set forth in Section 10.1.

     2.29 "Performance Goal" means the objective performance goals established
by the Committee in accordance with Section 162(m) of the Code and based on one
or more Performance Criteria.

     2.30 "Performance Period" has the meaning set forth in Section 9.1.

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     2.31 "Performance Share" means an Award made pursuant to Article IX of this
Plan of the right to receive Common Stock or, as determined by the Committee in
its sole discretion, cash of an equivalent value at the end of the Performance
Period or thereafter.

     2.32 "Performance Unit" means an Award made pursuant to Article X of this
Plan of the right to receive a fixed dollar amount, payable in cash or Common
Stock (or a combination of both) as determined by the Committee in its sole
discretion, at the end of a specified Performance Cycle or thereafter.

     2.33 "Plan" means this Insignia Financial Group, Inc. 1998 Stock Incentive
Plan (Amended and Restated as of April __, 2002), as amended from time to time.
Prior to November 2, 1998, the Plan was known as the Insignia/ESG Holdings, Inc.
1998 Stock Incentive Plan.

     2.34 "Reference Stock Option" has the meaning set forth in Section 7.1.

     2.35 "Restricted Stock" means an Award of shares of Common Stock under this
Plan that is subject to restrictions under Article VIII.

     2.36 "Restriction Period" has the meaning set forth in Section 8.3(a) with
respect to Restricted Stock.

     2.37 "Retirement" means a Termination of Employment or Termination of
Consultancy without Cause by a Participant at or after age 65 or such earlier
date after age 50 as may be approved by the Committee with regard to such
Participant. With respect to a Participant's Termination of Directorship,
Retirement shall mean the failure to stand for reelection or the failure to be
reelected at or after a Participant has attained age 65 or, with the consent of
the Board, before age 65 but after age 50.

     2.38 "Rule 16b-3" means Rule 16b-3 under Section 16(b) of the Exchange Act
as then in effect or any successor provisions.

     2.39 "Section 162(m) of the Code" means Section 162(m) of the Code and any
Treasury regulations thereunder.

     2.40 "Securities Act" means the Securities Act of 1933, as amended. Any
reference to any section of the Securities Act shall also be a reference to any
successor provision.

     2.41 "Stock Appreciation Right" or "SAR" means the right pursuant to an
Award granted under Article VII.

     2.42 "Stock Option" or "Option" means any option to purchase shares of
Common Stock granted to Eligible Employees or Consultants under Article VI or to
Non-Employee Directors under Article XIII.

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     2.43 "Subsidiary" means any subsidiary corporation of the Company within
the meaning of Section 424(f) of the Code.

     2.44 "Tandem Stock Appreciation Right" means a Stock Appreciation Right
entitling the holder to surrender to the Company all (or a portion) of a Stock
Option in exchange for an amount in cash or Common Stock (as determined by the
Committee in its sole discretion) equal to the excess of: (i) the Fair Market
Value, on the date such Stock Option (or such portion thereof) is surrendered,
of the Common Stock covered by such Stock Option (or such portion thereof), over
(ii) the aggregate exercise price of such Stock Option (or such portion
thereof).

     2.45 "Ten Percent Stockholder" means a person owning stock possessing more
than 10% of the total combined voting power of all classes of stock of the
Company, its Subsidiaries or its Parent.

     2.46 "Termination of Consultancy" means, with respect to a Consultant, that
the Consultant is no longer acting as a consultant to the Company or an
Affiliate. In the event an entity shall cease to be an Affiliate, there shall be
deemed a Termination of Consultancy of any individual who is not otherwise a
Consultant to the Company or another Affiliate at the time the entity ceases to
be an Affiliate.

     2.47 "Termination of Directorship" means, with respect to a Non-Employee
Director, that the Non-Employee Director has ceased to be a director of the
Company.

     2.48 "Termination of Employment" means: (i) a termination of employment
(for reasons other than a military or personal leave of absence granted by the
Company) of a Participant from the Company and its Affiliates; or (ii) when an
entity which is employing a Participant ceases to be an Affiliate, unless the
Participant otherwise is, or thereupon becomes, employed by the Company or
another Affiliate.

     2.49 "Transfer" means anticipate, alienate, attach, sell, assign, pledge,
encumber, charge, hypothecate or otherwise transfer and "Transferred" has a
correlative meaning.

                                   ARTICLE III

                                 ADMINISTRATION

     3.1 The Committee. The Plan shall be administered and interpreted by the
Committee. If for any reason the appointed Committee does not meet the
requirements of Rule 16b-3 or Section 162(m) of the Code, such noncompliance
with the requirements of Rule 16b-3 and Section 162(m) of the Code shall not
affect the validity of Awards, grants, interpretations or other actions of the
Committee.

     3.2 Grants of Awards. The Committee shall have full authority to grant to
Eligible Employees and Consultants, pursuant to the terms of this Plan: (i)
Stock Options; (ii) Tandem Stock Appreciation Rights and Non-Tandem Stock
Appreciation Rights; (iii) Restricted Stock;

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(iv) Performance Shares; (v) Performance Units; (vi) Other Stock-Based Awards;
and (vii) other awards providing benefits similar to (i) through (vi) designed
to meet the requirements of Foreign Jurisdictions. All Awards shall be granted
by, confirmed by, and subject to the terms of, a written agreement executed by
the Company and the Participant. In particular, the Committee shall have the
authority:

         (a) to select the Eligible Employees and Consultants to whom Awards may
     from time to time be granted hereunder;

         (b) to determine whether and to what extent Awards, including any
     combination of two or more Awards, are to be granted hereunder to one or
     more Eligible Employees or Consultants;

         (c) to determine, in accordance with the terms of this Plan, the number
     of shares of Common Stock to be covered by each Award granted hereunder;

         (d) to determine the terms and conditions, not inconsistent with the
     terms of this Plan, of any Award granted hereunder (including, but not
     limited to, the exercise or purchase price (if any), any restriction or
     limitation, any vesting schedule or acceleration thereof and any forfeiture
     restrictions or waiver thereof, regarding any Award and the shares of
     Common Stock relating thereto, based on such factors, if any, as the
     Committee shall determine, in its sole discretion);

         (e) to determine whether and under what circumstances a Stock Option
     may be settled in cash, Common Stock and/or Restricted Stock under Section
     6.3(d) or, with respect to Stock Options granted to Non-Employee Directors,
     Section 13.4(d);

         (f) to determine whether, to what extent and under what circumstances
     to provide loans (which shall bear interest at the rate the Committee shall
     provide) to Eligible Employees and Consultants in order to exercise Stock
     Options under this Plan or to purchase Awards under this Plan (including
     shares of Common Stock);

         (g) to determine whether a Stock Option is an Incentive Stock Option or
     Non-Qualified Stock Option, whether a Stock Appreciation Right is a Tandem
     Stock Appreciation Right or Non-Tandem Stock Appreciation Right or whether
     an Award is intended to satisfy Section 162(m) of the Code;

         (h) to determine whether to require an Eligible Employee or Consultant,
     as a condition of the granting of any Award, not to sell or otherwise
     dispose of shares of Common Stock acquired pursuant to the exercise of an
     Option or an Award for a period of time as determined by the Committee, in
     its sole discretion, following the date of the acquisition of such Option
     or Award;

         (i) to modify, extend or renew an Award, subject to Article XV herein,
     provided, however, that if an Award is modified, extended or renewed and
     thereby deemed to be the issuance of a new Award under the Code or the
     applicable accounting

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     rules, the exercise price of an Award may continue to be the original
     exercise price even if less than the Fair Market Value of the Common Stock
     at the time of such modification, extension or renewal; and

         (j) to offer to buy out an Option previously granted, based on such
     terms and conditions as the Committee shall establish and communicate to
     the Participant at the time such offer is made.

     3.3 Guidelines. Subject to Article XV hereof, the Committee shall have the
authority to adopt, alter and repeal such administrative rules, guidelines and
practices governing this Plan and perform all acts, including the delegation of
its administrative responsibilities, as it shall, from time to time, deem
advisable; to construe and interpret the terms and provisions of this Plan and
any Award issued under this Plan (and any agreements relating thereto); and to
otherwise supervise the administration of this Plan. The Committee may correct
any defect, supply any omission or reconcile any inconsistency in this Plan or
in any agreement relating thereto in the manner and to the extent it shall deem
necessary to effectuate the purpose and intent of this Plan. The Committee may
adopt special guidelines and provisions for persons who are residing in, or
subject to, the taxes of, Foreign Jurisdictions to comply with applicable tax
and securities laws and may impose any limitations and restrictions that it
deems necessary to comply with the applicable tax and securities laws of such
Foreign Jurisdictions. To the extent applicable, this Plan is intended to comply
with Section 162(m) of the Code and the applicable requirements of Rule 16b-3
and shall be limited, construed and interpreted in a manner so as to comply
therewith.

     3.4 Decisions Final. Any decision, interpretation or other action made or
taken in good faith by or at the direction of the Company, the Board or the
Committee (or any of its members) arising out of or in connection with this Plan
shall be within the absolute discretion of all and each of them, as the case may
be, and shall be final, binding and conclusive on the Company and all employees
and Participants and their respective heirs, executors, administrators,
successors and assigns.

     3.5 Reliance on Counsel. The Company, the Board or the Committee may
consult with legal counsel, who may be counsel for the Company or other counsel,
with respect to its obligations or duties hereunder, or with respect to any
action or proceeding or any question of law, and shall not be liable with
respect to any action taken or omitted by it in good faith pursuant to the
advice of such counsel.

     3.6 Procedures. If the Committee is appointed, the Board shall designate
one of the members of the Committee as chairman and the Committee shall hold
meetings, subject to the By-Laws of the Company, at such times and places as it
shall deem advisable. A majority of the Committee members shall constitute a
quorum. All determinations of the Committee shall be made by a majority of its
members. Any decision or determination reduced to writing and signed by all the
Committee members in accordance with the By-Laws of the Company, shall be fully
as effective as if it had been made by a vote at a meeting duly called and held.
The Committee shall keep minutes of its meetings and shall make such rules and
regulations for the conduct of its business as it shall deem advisable.

                                       8
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     3.7 Designation of Consultants/Liability.

         (a) The Committee may designate employees of the Company and
     professional advisors to assist the Committee in the administration of this
     Plan and may grant authority to officers to execute agreements or other
     documents on behalf of the Committee.

         (b) The Committee may employ such legal counsel, consultants and agents
     as it may deem desirable for the administration of this Plan and may rely
     upon any opinion received from any such counsel or consultant and any
     computation received from any such consultant or agent. Expenses incurred
     by the Committee in the engagement of any such counsel, consultant or agent
     shall be paid by the Company. The Committee, its members and any employee
     of the Company designated pursuant to paragraph (a) above shall not be
     liable for any action or determination made in good faith with respect to
     this Plan. To the maximum extent permitted by applicable law, no officer of
     the Company or member or former member of the Committee shall be liable for
     any action or determination made in good faith with respect to this Plan or
     any Award granted under it. To the maximum extent permitted by applicable
     law or the Certificate of Incorporation or By-Laws of the Company and to
     the extent not covered by insurance, each officer and member or former
     member of the Committee shall be indemnified and held harmless by the
     Company against any cost or expense (including reasonable fees of counsel
     reasonably acceptable to the Company) or liability (including any sum paid
     in settlement of a claim with the approval of the Company), and advanced
     amounts necessary to pay the foregoing at the earliest time and to the
     fullest extent permitted, arising out of any act or omission to act in
     connection with this Plan, except to the extent arising out of such
     officer's, member's or former member's own fraud or bad faith. Such
     indemnification shall be in addition to any rights of indemnification the
     officers, directors or members or former officers, directors or members may
     have under applicable law or under the Certificate of Incorporation or
     By-Laws of the Company or any Affiliate. Notwithstanding anything else
     herein, this indemnification will not apply to the actions or
     determinations made by an individual with regard to Awards granted to him
     or her under this Plan.

                                   ARTICLE IV

                           SHARE AND OTHER LIMITATIONS

     4.1 Shares.

         (a) General Limitation. The aggregate number of shares of Common Stock
     which may be issued or used for reference purposes under this Plan or with
     respect to which Awards may be granted shall not exceed the greater of (i)
     4,500,000 shares of Common Stock (subject to any increase or decrease
     pursuant to Section 4.2) with respect to all types of Awards or (ii) 12% of
     the number of shares of Common Stock issued and outstanding (assuming full
     dilution of all outstanding Awards and equity convertible into

                                       9
<PAGE>

     Common Stock), determined as of the Company's most recent fiscal quarter
     immediately preceding the grant of any Award (subject to any increase or
     decrease pursuant to Section 4.2) with respect to all types of Awards other
     than Incentive Stock Options. The shares of Common Stock available under
     this Plan may be either authorized and unissued Common Stock or Common
     Stock held in or acquired for the treasury of the Company. To the extent
     that an Incentive Stock Option is disqualified and no longer an Incentive
     Stock Option, the number of shares of Common Stock underlying the Stock
     Option shall continue to count against the aggregate limit of 4,500,000
     shares of Common Stock set forth herein. If any Stock Option or Stock
     Appreciation Right granted under this Plan expires, terminates or is
     canceled for any reason without having been exercised in full or, with
     respect to Stock Options, the Company repurchases any Stock Option, the
     number of shares of Common Stock underlying such unexercised or repurchased
     Stock Option or any unexercised Stock Appreciation Right shall again be
     available for the purposes of Awards under this Plan. If any shares of
     Restricted Stock, Performance Shares or Performance Units awarded under
     this Plan to a Participant are forfeited or repurchased by the Company for
     any reason, the number of forfeited or repurchased shares of Restricted
     Stock, Performance Shares or Performance Units shall again be available for
     the purposes of Awards under this Plan. If a Tandem Stock Appreciation
     Right is granted or a Limited Stock Appreciation Right is granted in tandem
     with a Stock Option, such grant shall only apply once against the maximum
     number of shares of Common Stock which may be issued under this Plan. In
     determining the number of shares of Common Stock available for Awards other
     than Awards of Incentive Stock Options, if Common Stock has been exchanged
     by a Participant as full or partial payment to the Company, or for
     withholding, in connection with the exercise of a Stock Option or the
     number shares of Common Stock otherwise deliverable has been reduced for
     withholding, the number of shares of Common Stock exchanged as payment in
     connection with the exercise or for withholding or reduced shall again be
     available for purposes of Awards under this Plan.

         (b) Individual Participant Limitations. (i) The maximum number of
     shares of Common Stock subject to any Award of Stock Options, Stock
     Appreciation Rights, Performance Shares or shares of Restricted Stock for
     which the grant of such Award or the lapse of the relevant Restriction
     Period is subject to the attainment of Performance Goals in accordance with
     Section 8.3(a)(ii) herein which may be granted under this Plan during any
     fiscal year of the Company to each Eligible Employee or Consultant shall be
     500,000 shares per type of Award (subject to any increase or decrease
     pursuant to Section 4.2), provided that the maximum number of shares of
     Common Stock for all types of Awards does not exceed 500,000 during any
     fiscal year of the Company. If a Tandem Stock Appreciation Right is granted
     or a Limited Stock Appreciation Right is granted in tandem with a Stock
     Option, it shall apply against the Eligible Employee's or Consultant's
     individual share limitations for both Stock Appreciation Rights and Stock
     Options.

                                       10
<PAGE>

               (ii) There are no annual individual Eligible Employee or
     Consultant share limitations on Restricted Stock for which the grant of
     such Award or the lapse of the relevant Restriction Period is not subject
     to attainment of Performance Goals in accordance with Section 8.3(a)(ii)
     hereof.

               (iii) The maximum value at grant of Performance Units which may
     be granted under this Plan during any fiscal year of the Company to each
     Eligible Employee or Consultant shall be $250,000. Each Performance Unit
     shall be referenced to one share of Common Stock and shall be charged
     against the available shares under this Plan at the time the unit value
     measurement is converted to a referenced number of shares of Common Stock
     in accordance with Section 10.1.

               (iv) The individual Participant limitations set forth in this
     Section 4.1(b) shall be cumulative; that is, to the extent that shares of
     Common Stock for which Awards are permitted to be granted to an Eligible
     Employee or a Consultant during a fiscal year are not covered by an Award
     to such Eligible Employee or Consultant in a fiscal year, the number of
     shares of Common Stock available for Awards to such Eligible Employee or
     Consultant shall automatically increase in the subsequent fiscal years
     during the term of the Plan until used.

     4.2 Changes.

         (a) The existence of this Plan and the Awards granted hereunder shall
     not affect in any way the right or power of the Board or the stockholders
     of the Company to make or authorize any adjustment, recapitalization,
     reorganization or other change in the Company's capital structure or its
     business, any merger or consolidation of the Company or any Affiliate, any
     issue of bonds, debentures, preferred or prior preference stock ahead of or
     affecting Common Stock, the dissolution or liquidation of the Company or
     any Affiliate, any sale or transfer of all or part of the assets or
     business of the Company or any Affiliate or any other corporate act or
     proceeding.

         (b) Subject to the provisions of Section 4.2(d), in the event of any
     such change in the capital structure or business of the Company by reason
     of any stock split, reverse stock split, stock dividend, combination or
     reclassification of shares, recapitalization, or other change in the
     capital structure of the Company, merger, consolidation, spin-off,
     reorganization, partial or complete liquidation, issuance of rights or
     warrants to purchase any Common Stock or securities convertible into Common
     Stock, or any other corporate transaction or event having an effect similar
     to any of the foregoing and effected without receipt of consideration by
     the Company, then the aggregate number and kind of shares which thereafter
     may be issued under this Plan, the number and kind of shares or other
     property (including cash) to be issued upon exercise of an outstanding
     Stock Option or other Awards granted under this Plan and the purchase price
     thereof shall be appropriately adjusted consistent with such change in such
     manner as the Committee may deem equitable to prevent substantial dilution
     or enlargement of the rights granted to, or available for, Participants
     under this Plan, and any such adjustment determined by the Committee in
     good faith shall be final, binding and

                                       11
<PAGE>

     conclusive on the Company and all Participants and employees and their
     respective heirs, executors, administrators, successors and assigns.

         (c) Fractional shares of Common Stock resulting from any adjustment in
     Options or Awards pursuant to Section 4.2(a) or (b) shall be aggregated
     until, and eliminated at, the time of exercise by rounding-down for
     fractions less than one-half and rounding-up for fractions equal to or
     greater than one-half. No cash settlements shall be made with respect to
     fractional shares eliminated by rounding. Notice of any adjustment shall be
     given by the Committee to each Participant whose Award has been adjusted
     and such adjustment (whether or not such notice is given) shall be
     effective and binding for all purposes of this Plan.

         (d) In the event of a merger or consolidation in which the Company is
     not the surviving entity or in the event of any transaction that results in
     the acquisition of substantially all of the Company's outstanding Common
     Stock by a single person or entity or by a group of persons and/or entities
     acting in concert, or in the event of the sale or transfer of all or
     substantially all of the Company's assets (all of the foregoing being
     referred to as "Acquisition Events"), then the Committee may, in its sole
     discretion, terminate all outstanding Stock Options and Stock Appreciation
     Rights, effective as of the date of the Acquisition Event, by delivering
     notice of termination to each Participant at least 30 days prior to the
     date of consummation of the Acquisition Event, in which case during the
     period from the date on which such notice of termination is delivered to
     the consummation of the Acquisition Event, each such Participant shall have
     the right to exercise in full all of his or her Stock Options and Stock
     Appreciation Rights that are then outstanding (without regard to any
     limitations on exercisability otherwise contained in the Stock Option or
     Award Agreements), but any such exercise shall be contingent upon and
     subject to the occurrence of the Acquisition Event, and, provided that, if
     the Acquisition Event does not take place within a specified period after
     giving such notice for any reason whatsoever, the notice and exercise
     pursuant thereto shall be null and void.

     If an Acquisition Event occurs but the Committee does not terminate the
outstanding Stock Options and Stock Appreciation Rights pursuant to this Section
4.2(d), then the provisions of Section 4.2(b) shall apply.

     4.3 Minimum Purchase Price. Notwithstanding any provision of this Plan to
the contrary, if authorized but previously unissued shares of Common Stock are
issued under this Plan, such shares shall not be issued for a consideration
which is less than as permitted under applicable law.

     4.4 Assumption of Awards. Except with regard to awards that are subject to
termination agreements with Insignia Financial Group Inc. providing for the
cash-out and cancellation of the award, awards that were granted prior to the
Effective Date under the Insignia Financial Group Inc.'s 1992 Stock Incentive
Plan, as amended, to individuals who became Eligible Employees of or Consultants
to the Company or an Affiliate as of the Distribution Date and that were
outstanding immediately prior to the Distribution Date will be assumed by the
Company as of the Distribution Date and converted into Awards hereunder based on
the

                                       12
<PAGE>

Company's Common Stock in a manner determined by the Committee. The terms of
such Awards shall be governed by the terms of this Plan as of the Effective
Date. Notwithstanding the foregoing, such Awards shall continue to be governed
by the terms of the applicable agreement in effect prior to the Effective Date,
except as adjusted to reflect the appropriate number of shares of Common Stock
and, with respect to Stock Options, the appropriate exercise price.

                                    ARTICLE V

                                   ELIGIBILITY

     5.1 General Eligibility. All Eligible Employees and Consultants and
prospective employees of and Consultants to the Company and its Affiliates are
eligible to be granted Non-Qualified Stock Options, Stock Appreciation Rights,
Restricted Stock, Performance Shares, Performance Units, Other Stock-Based
Awards and awards providing benefits similar to each of the foregoing designed
to meet the requirements of Foreign Jurisdictions under this Plan. Eligibility
for the grant of an Award and actual participation in this Plan shall be
determined by the Committee in its sole discretion. The vesting and exercise of
Awards granted to a prospective employee or Consultant are conditioned upon such
individual actually becoming an Eligible Employee or Consultant.

     5.2 Incentive Stock Options. All Eligible Employees of the Company, its
Subsidiaries and its Parent (if any) are eligible to be granted Incentive Stock
Options under this Plan. Notwithstanding the foregoing, unless otherwise
permitted pursuant to the Code, "qualified real estate agents" (as defined in
Section 3508 of the Code) shall not be eligible to be granted Incentive Stock
Options under this Plan. Eligibility for the grant of an Award and actual
participation in this Plan shall be determined by the Committee in its sole
discretion.

     5.3 Non-Employee Directors. Non-Employee Directors are only eligible to
receive an Award of Stock Options in accordance with Article XIII of the Plan.

                                   ARTICLE VI

                                  STOCK OPTIONS

     6.1 Stock Options. Each Stock Option granted hereunder shall be one of two
types: (i) an Incentive Stock Option intended to satisfy the requirements of
Section 422 of the Code; or (ii) a Non-Qualified Stock Option.

     6.2 Grants. The Committee shall have the authority to grant to any Eligible
Employee one or more Incentive Stock Options, Non-Qualified Stock Options or
both types of Stock Options (in each case with or without Stock Appreciation
Rights). To the extent that any Stock Option does not qualify as an Incentive
Stock Option (whether because of its provisions or the time or manner of its
exercise or otherwise), such Stock Option or the portion thereof which does not
qualify, shall constitute a separate Non- Qualified Stock Option. The Committee
shall

                                       13
<PAGE>

have the authority to grant any Consultant one or more Non-Qualified Stock
Options (with or without Stock Appreciation Rights). Notwithstanding any other
provision of this Plan to the contrary or any provision in an agreement
evidencing the grant of a Stock Option to the contrary, any Stock Option granted
to an Eligible Employee of an Affiliate (other than an Affiliate which is a
Parent or a Subsidiary) shall be a Non-Qualified Stock Option.

     6.3 Terms of Stock Options. Stock Options granted under this Plan shall be
subject to the following terms and conditions, and shall be in such form and
contain such additional terms and conditions, not inconsistent with the terms of
this Plan, as the Committee shall deem desirable:

         (a) Exercise Price. The exercise price per share of Common Stock
     purchasable under an Incentive Stock Option or a Stock Option intended to
     be "performance-based" for purposes of Section 162(m) of the Code shall be
     determined by the Committee at the time of grant, but shall not be less
     than 100% of the Fair Market Value of the share of Common Stock at the time
     of grant; provided, however, that if an Incentive Stock Option is granted
     to a Ten Percent Stockholder, the exercise price shall be no less than 110%
     of the Fair Market Value of the Common Stock. The exercise price per share
     of Common Stock purchasable under a Non-Qualified Stock Option shall be
     determined by the Committee.

         (b) Stock Option Term. The term of each Stock Option shall be fixed by
     the Committee; provided, however, that no Stock Option shall be exercisable
     more than 10 years after the date such Stock Option is granted; and further
     provided that the term of an Incentive Stock Option granted to a Ten
     Percent Stockholder shall not exceed 5 years.

         (c) Exercisability. Stock Options shall be exercisable at such time or
     times and subject to such terms and conditions as shall be determined by
     the Committee at grant. If the Committee provides, in its discretion, that
     any Stock Option is exercisable subject to certain limitations (including,
     without limitation, that such Stock Option is exercisable only in
     installments or within certain time periods), the Committee may waive such
     limitations on the exercisability at any time at or after grant in whole or
     in part (including, without limitation, waiver of the installment exercise
     provisions or acceleration of the time at which such Stock Option may be
     exercised), based on such factors, if any, as the Committee shall
     determine, in its sole discretion.

         (d) Method of Exercise. Subject to whatever installment exercise and
     waiting period provisions apply under subsection (c) above, Stock Options
     may be exercised in whole or in part at any time and from time to time
     during the Stock Option term by giving written notice of exercise to the
     Committee specifying the number of shares to be purchased. Such notice
     shall be accompanied by payment in full of the purchase price as follows:
     (i) in cash or by check, bank draft or money order payable to the order of
     the Company; (ii) if the Common Stock is traded on a national securities
     exchange, the Nasdaq Stock Market, Inc. or quoted on a national quotation
     system sponsored by the National Association of Securities Dealers, through
     a "cashless exercise" procedure whereby the Participant delivers
     irrevocable instructions to a broker to deliver promptly

                                       14
<PAGE>

     to the Company an amount equal to the purchase price; or (iii) on such
     other terms and conditions as may be acceptable to the Committee
     (including, without limitation, the relinquishment of Stock Options or by
     payment in full or in part in the form of Common Stock owned by the
     Participant for a period of at least 6 months (and for which the
     Participant has good title free and clear of any liens and encumbrances)
     based on the Fair Market Value of the Common Stock on the payment date as
     determined by the Committee). No shares of Common Stock shall be issued
     until payment therefor, as provided herein, has been made or provided for.

         (e) Incentive Stock Option Limitations. To the extent that the
     aggregate Fair Market Value (determined as of the time of grant) of the
     Common Stock with respect to which Incentive Stock Options are exercisable
     for the first time by an Eligible Employee during any calendar year under
     this Plan and/or any other stock option plan of the Company, any Subsidiary
     or any Parent exceeds $100,000, such Options shall be treated as
     Non-Qualified Stock Options. In addition, if an Eligible Employee does not
     remain employed by the Company, any Subsidiary or any Parent at all times
     from the time an Incentive Stock Option is granted until 3 months prior to
     the date of exercise thereof (or such other period as required by
     applicable law), such Stock Option shall be treated as a Non-Qualified
     Stock Option. Should any provision of this Plan not be necessary in order
     for the Stock Options to qualify as Incentive Stock Options, or should any
     additional provisions be required, the Committee may amend this Plan
     accordingly, without the necessity of obtaining the approval of the
     stockholders of the Company.

         (f) Form, Modification, Extension and Renewal of Stock Options. Subject
     to the terms and conditions and within the limitations of this Plan, Stock
     Options shall be evidenced by such form of agreement or grant as is
     approved by the Committee, and the Committee may (i) modify, extend or
     renew outstanding Stock Options granted under this Plan (provided that the
     rights of a Participant are not reduced without his consent), and (ii)
     accept the surrender of outstanding Stock Options (up to the extent not
     theretofore exercised) and authorize the granting of new Stock Options in
     substitution therefor (to the extent not theretofore exercised).
     Notwithstanding the foregoing, without the approval of the shareholders of
     the Company, an outstanding Stock Option may not be modified to reduce the
     exercise price thereof nor may a new Option at a lower price be substituted
     for a simultaneously surrendered Option, provided that the foregoing shall
     not apply to adjustments or substitutions in accordance with Section 4.2.

                                       15
<PAGE>

         (g) Other Terms and Conditions. Stock Options may contain such other
     provisions, which shall not be inconsistent with any of the terms of this
     Plan, as the Committee shall deem appropriate including, without
     limitation, permitting "reloads" such that the same number of Stock Options
     are granted as the number of Stock Options exercised, shares used to pay
     for the exercise price of Stock Options or shares used to pay withholding
     taxes ("Reloads"). With respect to Reloads, the exercise price of the new
     Stock Option shall be the Fair Market Value on the date of the "reload" and
     the term of the Stock Option shall be the same as the remaining term of the
     Stock Options that are exercised, if applicable, or such other exercise
     price and term as determined by the Committee.

                                   ARTICLE VII

                            STOCK APPRECIATION RIGHTS

     7.1 Tandem Stock Appreciation Rights. Stock Appreciation Rights may be
granted in conjunction with all or part of any Stock Option (a "Reference Stock
Option") granted under this Plan ("Tandem Stock Appreciation Rights"). In the
case of a Non-Qualified Stock Option, such rights may be granted either at or
after the time of the grant of such Reference Stock Option. In the case of an
Incentive Stock Option, such rights may be granted only at the time of the grant
of such Reference Stock Option. Consultants shall not be eligible for a grant of
Tandem Stock Appreciation Rights granted in conjunction with all or part of an
Incentive Stock Option.

     7.2 Terms and Conditions of Tandem Stock Appreciation Rights. Tandem Stock
Appreciation Rights shall be subject to such terms and conditions, not
inconsistent with the provisions of this Plan, as shall be determined from time
to time by the Committee, including Article XII and the following:

         (a) Term. A Tandem Stock Appreciation Right or applicable portion
     thereof granted with respect to a Reference Stock Option shall terminate
     and no longer be exercisable upon the termination or exercise of the
     Reference Stock Option, except that, unless otherwise determined by the
     Committee, in its sole discretion, at the time of grant, a Tandem Stock
     Appreciation Right granted with respect to less than the full number of
     shares covered by the Reference Stock Option shall not be reduced until and
     then only to the extent the exercise or termination of the Reference Stock
     Option causes the number of shares covered by the Tandem Stock Appreciation
     Right to exceed the number of shares remaining available and unexercised
     under the Reference Stock Option.

         (b) Exercisability. Tandem Stock Appreciation Rights shall be
     exercisable only at such time or times and to the extent that the Reference
     Stock Options to which they relate shall be exercisable in accordance with
     the provisions of Article VI and this Article VII.

         (c) Method of Exercise. A Tandem Stock Appreciation Right may be
     exercised by a Participant by surrendering the applicable portion of the
     Reference Stock

                                       16
<PAGE>

     Option. Upon such exercise and surrender, the Participant shall be entitled
     to receive an amount determined in the manner prescribed in this Section
     7.2. Stock Options which have been so surrendered, in whole or in part,
     shall no longer be exercisable to the extent the related Tandem Stock
     Appreciation Rights have been exercised.

         (d) Payment. Upon the exercise of a Tandem Stock Appreciation Right, a
     Participant shall be entitled to receive up to, but no more than, an amount
     in cash and/or Common Stock (as chosen by the Committee in its sole
     discretion at grant, or thereafter if no rights of a Participant are
     reduced) equal in value to the excess of the Fair Market Value of one share
     of Common Stock over the option price per share specified in the Reference
     Stock Option, multiplied by the number of shares in respect of which the
     Tandem Stock Appreciation Right shall have been exercised.

         (e) Deemed Exercise of Reference Stock Option. Upon the exercise of a
     Tandem Stock Appreciation Right, the Reference Stock Option or part thereof
     to which such Stock Appreciation Right is related shall be deemed to have
     been exercised for the purpose of the limitation set forth in Article IV of
     this Plan on the number of shares of Common Stock to be issued under this
     Plan.

     7.3 Non-Tandem Stock Appreciation Rights. Non-Tandem Stock Appreciation
Rights may also be granted without reference to any Stock Option granted under
this Plan.

     7.4 Terms and Conditions of Non-Tandem Stock Appreciation Rights. Non-
Tandem Stock Appreciation Rights shall be subject to such terms and conditions,
not inconsistent with the provisions of this Plan, as shall be determined from
time to time by the Committee, including Article XII and the following:

         (a) Term. The term of each Non-Tandem Stock Appreciation Right shall be
     fixed by the Committee, but shall not be greater than ten (10) years after
     the date the right is granted.

         (b) Exercisability. Non-Tandem Stock Appreciation Rights shall be
     exercisable at such time or times and subject to such terms and conditions
     as shall be determined by the Committee at grant. If the Committee
     provides, in its discretion, that any such right is exercisable subject to
     certain limitations (including, without limitation, that it is exercisable
     only in installments or within certain time periods), the Committee may
     waive such limitation on the exercisability at any time at or after grant
     in whole or in part (including, without limitation, waiver of the
     installment exercise provisions or acceleration of the time at which rights
     may be exercised), based on such factors, if any, as the Committee shall
     determine, in its sole discretion.

                                       17
<PAGE>

         (c) Method of Exercise. Subject to whatever installment exercise and
     waiting period provisions apply under subsection (b) above, Non-Tandem
     Stock Appreciation Rights may be exercised in whole or in part at any time
     and from time to time during the option term, by giving written notice of
     exercise to the Company specifying the number of Non-Tandem Stock
     Appreciation Rights to be exercised.

         (d) Payment. Upon the exercise of a Non-Tandem Stock Appreciation Right
     a Participant shall be entitled to receive, for each right exercised, up
     to, but no more than, an amount in cash and/or Common Stock (as chosen by
     the Committee in its sole discretion at grant, or thereafter if no rights
     of a Participant are reduced) equal in value to the excess of the Fair
     Market Value of one share of Common Stock on the date the right is
     exercised over the Fair Market Value of one share of Common Stock on the
     date the right was awarded to the Participant.

     7.5 Limited Stock Appreciation Rights. The Committee may, in its sole
discretion, grant a Tandem Stock Appreciation Right or a Non-Tandem Stock
Appreciation Right as a Limited Stock Appreciation Right. Limited Stock
Appreciation Rights may be exercised only upon the occurrence of a Change in
Control or such other event as the Committee may, in its sole discretion,
designate at the time of grant or thereafter. Upon the exercise of limited Stock
Appreciation Rights, except as otherwise provided in an Award agreement, the
Participant shall receive in cash or Common Stock, as determined by the
Committee, an amount equal to the amount (i) set forth in Section 7.2(d) with
respect to Tandem Stock Appreciation Rights, or (ii) set forth in Section 7.4(d)
with respect to Non-Tandem Stock Appreciation Rights, as applicable.

                                  ARTICLE VIII

                                RESTRICTED STOCK

     8.1 Awards of Restricted Stock. Shares of Restricted Stock may be issued to
Eligible Employees or Consultants either alone or in addition to other Awards
granted under this Plan. The Committee shall determine the eligible persons to
whom, and the time or times at which, grants of Restricted Stock will be made,
the number of shares to be awarded, the price (if any) to be paid by the
recipient (subject to Section 8.2), the time or times within which such Awards
may be subject to forfeiture, the vesting schedule and rights to acceleration
thereof, and all other terms and conditions of the Awards. The Committee may
condition the grant or vesting of Restricted Stock upon the attainment of
specified performance goals, including established Performance Goals in
accordance with Section 162(m) of the Code, or such other factors as the
Committee may determine, in its sole discretion.

     8.2 Awards and Certificates. An Eligible Employee or Consultant selected to
receive Restricted Stock shall not have any rights with respect to such Award,
unless and until such Participant has delivered to the Company a fully executed
copy of the applicable Award agreement relating thereto and has otherwise
complied with the applicable terms and conditions of such Award. Further, such
Award shall be subject to the following conditions:

                                       18
<PAGE>

         (a) Purchase Price. The purchase price of Restricted Stock shall be
     fixed by the Committee. Subject to Section 4.3, the purchase price for
     shares of Restricted Stock may be zero to the extent permitted by
     applicable law, and, to the extent not so permitted, such purchase price
     may not be less than par value.

         (b) Acceptance. Awards of Restricted Stock must be accepted within a
     period of 90 days (or such shorter period as the Committee may specify at
     grant) after the Award date by executing a Restricted Stock Award agreement
     and by paying whatever price (if any) the Committee has designated
     thereunder.

         (c) Legend. Each Participant receiving shares of Restricted Stock shall
     be issued a stock certificate in respect of such shares of Restricted
     Stock, unless the Committee elects to use another system, such as book
     entries by the transfer agent, as evidencing ownership of shares of
     Restricted Stock. Such certificate shall be registered in the name of such
     Participant, and shall bear an appropriate legend referring to the terms,
     conditions, and restrictions applicable to such Award, substantially in the
     following form:

          "The anticipation, alienation, attachment, sale, transfer, assignment,
          pledge, encumbrance or charge of the shares of stock represented
          hereby are subject to the terms and conditions (including forfeiture)
          of the Insignia Financial Group, Inc. (the "Company") 1998 Stock
          Incentive Plan (Amended and Restated as of April 8, 2002) (the "Plan")
          and an Agreement entered into between the registered owner and the
          Company dated . Copies of such Plan and Agreement are on file at the
          principal office of the Company."

         (d) Custody. The Committee may require that any stock certificates
     evidencing such shares be held in custody by the Company until the
     restrictions thereon shall have lapsed and that, as a condition to the
     grant of such Award of Restricted Stock, the Participant shall have
     delivered a duly signed stock power, endorsed in blank, relating to the
     Common Stock covered by such Award.

     8.3 Restrictions and Conditions on Restricted Stock Awards. Shares of
Restricted Stock awarded pursuant to this Plan shall be subject to Article XII
and the following restrictions and conditions:

         (a) Restriction Period; Vesting and Acceleration of Vesting. (i) The
     Participant shall not be permitted to Transfer shares of Restricted Stock
     awarded under this Plan during the period or periods set by the Committee
     (the "Restriction Period") commencing on the date of such Award, as set
     forth in the Restricted Stock Award agreement and such agreement shall set
     forth a vesting schedule and any events which would accelerate vesting of
     the shares of Restricted Stock. Within these limits, based on service,
     attainment of Performance Goals pursuant to Section 8.3(a)(ii) below and/or
     such other factors or criteria as the Committee may determine in its sole
     discretion, the Committee may provide for the lapse of such restrictions in
     installments in whole or in

                                       19
<PAGE>

     part, or may accelerate the vesting of all or any part of any Restricted
     Stock Award and/or waive the deferral limitations for all or any part of
     any Restricted Stock Award.

               (ii) Objective Performance Goals, Formulae or Standards. If the
     grant of shares of Restricted Stock or the lapse of restrictions is based
     on the attainment of Performance Goals, the Committee shall establish the
     Performance Goals and the applicable vesting percentage of the Restricted
     Stock Award applicable to each Participant or class of Participants in
     writing prior to the beginning of the applicable fiscal year or at such
     later date as otherwise determined by the Committee and while the outcome
     of the Performance Goals are substantially uncertain. Such Performance
     Goals may incorporate provisions for disregarding (or adjusting for)
     changes in accounting methods, corporate transactions (including, without
     limitation, dispositions and acquisitions) and other similar type events or
     circumstances. With regard to a Restricted Stock Award that is intended to
     comply with Section 162(m) of the Code, to the extent any such provision
     would create impermissible discretion under Section 162(m) of the Code or
     otherwise violate Section 162(m) of the Code, such provision shall be of no
     force or effect. The applicable Performance Goals shall be based on one or
     more of the Performance Criteria set forth in Exhibit A hereto.

         (b) Rights as Stockholder. Except as provided in this subsection (b)
     and subsection (a) above and as otherwise determined by the Committee, the
     Participant shall have, with respect to the shares of Restricted Stock, all
     of the rights of a holder of shares of Common Stock of the Company
     including, without limitation, the right to receive any dividends, the
     right to vote such shares and, subject to and conditioned upon the full
     vesting of shares of Restricted Stock, the right to tender such shares. The
     Committee may, in its sole discretion, determine at the time of grant that
     the payment of dividends shall be deferred until, and conditioned upon, the
     expiration of the applicable Restriction Period.

         (c) Lapse of Restrictions. If and when the Restriction Period expires
     without a prior forfeiture of the Restricted Stock subject to such
     Restriction Period, the certificates for such shares shall be delivered to
     the Participant. All legends shall be removed from said certificates at the
     time of delivery to the Participant except as otherwise required by
     applicable law.

                                   ARTICLE IX

                               PERFORMANCE SHARES

     9.1 Award of Performance Shares. Performance Shares may be awarded either
alone or in addition to other Awards granted under this Plan. The Committee
shall, in its sole discretion, determine the Eligible Employees and Consultants
to whom and the time or times at which such Performance Shares shall be awarded,
the duration of the period (the "Performance Period") during which, and the
conditions under which, a Participant's right to Performance

                                       20
<PAGE>

Shares will be vested and the other terms and conditions of the Award in
addition to those set forth in Section 9.2.

     Each Performance Share awarded shall be referenced to one share of Common
Stock. Except as otherwise provided herein, the Committee shall condition the
right to payment of any Performance Share Award upon the attainment of objective
Performance Goals established pursuant to Section 9.2(c) below and such other
non-performance based factors or criteria as the Committee may determine in its
sole discretion.

     9.2 Terms and Conditions. A Participant selected to receive Performance
Shares shall not have any rights with respect to such Awards, unless and until
such Participant has delivered a fully executed copy of a Performance Share
Award agreement evidencing the Award to the Company and has otherwise complied
with the following terms and conditions:

         (a) Earning of Performance Share Award. At the expiration of the
     applicable Performance Period, the Committee shall determine the extent to
     which the Performance Goals established pursuant to Section 9.2(c) are
     achieved and the percentage of each Performance Share Award that has been
     earned.

         (b) Payment. Following the Committee's determination in accordance with
     subsection (a) above, shares of Common Stock or, as determined by the
     Committee in its sole discretion, the cash equivalent of such shares shall
     be delivered to the Participant, in an amount equal to such Participant's
     earned Performance Share Award. Notwithstanding the foregoing, except as
     may be set forth in the agreement covering the Award, the Committee may, in
     its sole discretion and in accordance with Section 162(m) of the Code,
     award an amount less than the earned Performance Share Award and/or subject
     the payment of all or part of any Performance Share Award to additional
     vesting and forfeiture conditions as it deems appropriate.

         (c) Objective Performance Goals, Formulae or Standards. The Committee
     shall establish the objective Performance Goals for the earning of
     Performance Shares based on a Performance Period applicable to each
     Participant or class of Participants in writing prior to the beginning of
     the applicable Performance Period or at such later date as permitted under
     Section 162(m) of the Code and while the outcome of the Performance Goals
     are substantially uncertain. Such Performance Goals may incorporate, if and
     only to the extent permitted under Section 162(m) of the Code, provisions
     for disregarding (or adjusting for) changes in accounting methods,
     corporate transactions (including, without limitation, dispositions and
     acquisitions) and other similar type events or circumstances. To the extent
     any such provision would create impermissible discretion under Section
     162(m) of the Code or otherwise violate Section 162(m) of the Code, such
     provision shall be of no force or effect. The applicable Performance Goals
     shall be based on one or more of the Performance Criteria set forth in
     Exhibit A hereto.

         (d) Dividends and Other Distributions. At the time of any Award of
     Performance Shares, the Committee may, in its sole discretion, award an
     Eligible

                                       21
<PAGE>

     Employee or Consultant the right to receive the cash value of any dividends
     and other distributions that would have been received as though the
     Eligible Employee or Consultant had held each share of Common Stock
     referenced by the earned Performance Share Award from the last day of the
     first year of the Performance Period until the actual distribution to such
     Participant of the related share of Common Stock or cash value thereof.
     Such amounts, if awarded, shall be paid to the Participant as and when the
     shares of Common Stock or cash value thereof are distributed to such
     Participant and, at the discretion of the Committee, may be paid with
     interest from the first day of the second year of the Performance Period
     until such amounts and any earnings thereon are distributed. The applicable
     rate of interest shall be determined by the Committee in its sole
     discretion; provided, however, that for each fiscal year or part thereof,
     the applicable interest rate shall not be greater than a rate equal to the
     four-year U.S. Government Treasury rate on the first day of each applicable
     fiscal year.

                                    ARTICLE X

                                PERFORMANCE UNITS

     10.1 Awards of Performance Units. Performance Units may be awarded either
alone or in addition to other Awards granted under this Plan. The Committee
shall, in its sole discretion, determine the Eligible Employees to whom and the
time or times at which such Performance Units shall be awarded, the duration of
the period (the "Performance Cycle") during which, and the conditions under
which, a Participant's right to Performance Units will be vested and the other
terms and conditions of the Award in addition to those set forth in Section
10.2.

     Performance Units shall be awarded in a dollar amount determined by the
Committee and shall be converted for purposes of calculating growth in value to
a referenced number of shares of Common Stock based on the Fair Market Value of
shares of Common Stock at the close of trading on the first business day
following the announcement of the annual financial results of the Company for
the fiscal year of the Company immediately preceding the fiscal year of the
commencement of the relevant Performance Cycle, provided that the Committee may
provide that the minimum price for such conversion shall be the Fair Market
Value on the date of grant.

     Each Performance Unit shall be referenced to one share of Common Stock.
Except as otherwise provided herein, the Committee shall condition the right to
payment of any Performance Unit Award upon the attainment of objective
Performance Goals established pursuant to Section 10.2(a) and such other
non-performance based factors or criteria as the Committee may determine in its
sole discretion. The cash value of any fractional Performance Unit Award
subsequent to conversion to shares of Common Stock shall be treated as a
dividend or other distribution under Section 10.2(e) to the extent any portion
of the Performance Unit Award is earned.

     10.2 Terms and Conditions. The Performance Units awarded pursuant to this
Article 10 shall be subject to the following terms and conditions:

                                       22
<PAGE>

         (a) Performance Goals. The Committee shall establish the objective
     Performance Goals for the earnings of Performance Units based on a
     Performance Cycle applicable to each Participant or class of Participants
     in writing prior to the beginning of the applicable Performance Cycle or at
     such later date as permitted under Section 162(m) of the Code and while the
     outcome of the Performance Goals are substantially uncertain. Such
     Performance Goals may incorporate, if and only to the extent permitted
     under Section 162(m) of the Code, provisions for disregarding (or adjusting
     for) changes in accounting methods, corporate transactions (including,
     without limitation, dispositions and acquisitions) and other similar type
     events or circumstances. To the extent any such provision would create
     impermissible discretion under Section 162(m) of the Code or otherwise
     violate Section 162(m) of the Code, such provision shall be of no force or
     effect. The applicable Performance Goals shall be based on one or more of
     the Performance Criteria set forth in Exhibit A hereto.

         (b) Vesting. At the expiration of the Performance Cycle, the Committee
     shall determine and certify in writing the extent to which the Performance
     Goals have been achieved, and the percentage of the Performance Units of
     each Participant that have vested.

         (c) Payment. Subject to the applicable provisions of the Award
     agreement and this Plan, at the expiration of the Performance Cycle, cash
     and/or shares of Common Stock (as the Committee may determine in its sole
     discretion at grant, or thereafter if no rights of a Participant are
     reduced) shall be delivered to the Participant in payment of the vested
     Performance Units covered by the Performance Unit Award. Notwithstanding
     the foregoing, except as may be set forth in the agreement covering the
     Award, the Committee may, in its sole discretion, and to the extent
     applicable and permitted under Section 162(m) of the Code, award an amount
     less than the earned Performance Unit Award and/or subject the payment of
     all or part of any Performance Unit Award to additional vesting and
     forfeiture conditions as it deems appropriate.

         (d) Accelerated Vesting. Based on service, performance and/or such
     other factors or criteria, if any, as the Committee may determine, the
     Committee may, at or after grant, accelerate the vesting of all or any part
     of any Performance Unit Award and/or waive the deferral limitations for all
     or any part of such Award.

         (e) Dividends and Other Distributions. At the time of any Award of
     Performance Units, the Committee may, in its sole discretion, award an
     Eligible Employee or Consultant the right to receive the cash value of any
     dividends and other distributions that would have been received as though
     the Eligible Employee or Consultant had held each share of Common Stock
     referenced by the earned Performance Unit Award from the last day of the
     first year of the Performance Cycle until the actual distribution to such
     Participant of the related share of Common Stock or cash value thereof.
     Such amounts, if awarded, shall be paid to the Participant as and when the
     shares of Common Stock or cash value thereof are distributed to such
     Participant and, at the discretion of the Committee, may be paid with
     interest from the first day of the second year of the Performance Cycle
     until such amounts and any earnings thereon are

                                       23
<PAGE>

     distributed. The applicable rate of interest shall be determined by the
     Committee in its sole discretion; provided, however, that for each fiscal
     year or part thereof, the applicable interest rate shall not be greater
     than a rate equal to the four-year U.S. Government Treasury rate on the
     first day of each applicable fiscal year.

                                   ARTICLE XI

                            OTHER STOCK-BASED AWARDS

     11.1 Other Awards. Other Stock-Based Awards may be granted either alone or
in addition to or in tandem with Stock Options, Stock Appreciation Rights,
Restricted Stock, Performance Shares or Performance Units.

     Subject to the provisions of this Plan, the Committee shall have authority
to determine the persons to whom and the time or times at which such Awards
shall be made, the number of shares of Common Stock to be awarded pursuant to
such Awards, and all other conditions of the Awards. The Committee may also
provide for the grant of Common Stock under such Awards upon the completion of a
specified performance period.

     11.2 Terms and Conditions. Other Stock-Based Awards made pursuant to this
Article XI shall be subject to the following terms and conditions:

         (a) Non-Transferability. Subject to the applicable provisions of the
     Award agreement and this Plan, shares of Common Stock subject to Awards
     made under this Article XI may not be Transferred prior to the date on
     which the shares are issued, or, if later, the date on which any applicable
     restriction, performance or deferral period lapses.

         (b) Dividends. Unless otherwise determined by the Committee at the time
     of Award, subject to the provisions of the Award agreement and this Plan,
     the recipient of an Award under this Article XI shall be entitled to
     receive, currently or on a deferred basis, dividends or dividend
     equivalents with respect to the number of shares of Common Stock covered by
     the Award, as determined at the time of the Award by the Committee, in its
     sole discretion.

         (c) Vesting. Any Award under this Article XI and any Common Stock
     covered by any such Award shall vest or be forfeited to the extent so
     provided in the Award agreement, as determined by the Committee, in its
     sole discretion.

         (d) Waiver of Limitation. The Committee may, in its sole discretion,
     waive in whole or in part any or all of the limitations imposed hereunder
     (if any) with respect to any or all of an Award under this Article XI.

         (e) Price. Common Stock or Other Stock-Based Awards issued on a bonus
     basis under this Article XI may be issued for no cash consideration; Common
     Stock or Other Stock-Based Awards purchased pursuant to a purchase right
     awarded under this

                                       24
<PAGE>

     Article XI shall be priced as determined by the Committee. Subject to
     Section 4.3, the purchase price of shares of Common Stock or Other
     Stock-Based Awards may be zero to the extent permitted by applicable law,
     and, to the extent not so permitted, such purchase price may not be less
     than par value. The purchase of shares of Common Stock or Other Stock-Based
     Awards may be made on either an after-tax or pre-tax basis, as determined
     by the Committee; provided, however, that if the purchase is made on a
     pre-tax basis, such purchase shall be made pursuant to a deferred
     compensation program established by the Committee, which will be deemed a
     part of this Plan.

     11.3 Purchase and Loan Program. The Company's 1998 Supplemental Stock
Purchase and Loan Program shall be an Other Stock-Based Award under this Article
XI and shall be deemed incorporated herein.

                                   ARTICLE XII

                     NON-TRANSFERABILITY AND TERMINATION OF
                             EMPLOYMENT/CONSULTANCY

     12.1 Non-Transferability. No Stock Option, Stock Appreciation Right,
Performance Unit, Performance Share or Other Stock-Based Award shall be
Transferable by the Participant otherwise than by will or by the laws of descent
and distribution. All Stock Options and all Stock Appreciation Rights shall be
exercisable, during the Participant's lifetime, only by the Participant. Tandem
Stock Appreciation Rights shall be Transferable, to the extent permitted above,
only with the underlying Stock Option. Shares of Restricted Stock under Article
VIII may not be Transferred prior to the date on which shares are issued, or, if
later, the date on which any applicable restriction, performance or deferral
period lapses. No Award shall, except as otherwise specifically provided by law
or herein, be Transferable in any manner, and any attempt to Transfer any such
Award shall be void, and no such Award shall in any manner be liable for or
subject to the debts, contracts, liabilities, engagements or torts of any person
who shall be entitled to such Award, nor shall it be subject to attachment or
legal process for or against such person. Notwithstanding the foregoing, the
Committee may determine at the time of grant or thereafter, that a Non-Qualified
Stock Option granted pursuant to Article VI (other than a Non-Qualified Stock
Option granted to a Non-Employee Director) that is otherwise not transferable
pursuant to this Article XII is transferable in whole or part and in such
circumstances, and under such conditions, as specified by the Committee.

     12.2 Termination of Employment or Termination of Consultancy. The following
rules apply with regard to the Termination of Employment or Termination of
Consultancy of a Participant:

         (a) Rules Applicable to Stock Options and Stock Appreciation Rights.
     Unless otherwise determined by the Committee at grant or, if no rights of
     the Participant are reduced, thereafter:

               (i) Termination by Reason of Death, Disability or Retirement. If
     a Participant's Termination of Employment or Termination of Consultancy is
     by reason of

                                       25
<PAGE>

     death, Disability or Retirement, all Stock Options and Stock Appreciation
     Rights held by such Participant may be exercised, to the extent exercisable
     at the Participant's Termination of Employment or Termination of
     Consultancy, by the Participant (or, in the case of death, by the legal
     representative of the Participant's estate) at any time within a period of
     one year from the date of such Termination of Employment or Termination of
     Consultancy, but in no event beyond the expiration of the stated terms of
     such Stock Options and Stock Appreciation Rights; provided, however, that,
     in the case of Retirement, if the Participant dies within such exercise
     period, all unexercised Stock Options and Non-Tandem Stock Appreciation
     Rights held by such Participant shall thereafter be exercisable, to the
     extent to which they were exercisable at the time of death, for a period of
     one year from the date of such death, but in no event beyond the expiration
     of the stated term of such Stock Options and Non-Tandem Stock Appreciation
     Rights.

               (ii) Involuntary Termination Without Cause. If a Participant's
     Termination of Employment or Termination of Consultancy is by involuntary
     termination without Cause, all Stock Options and Stock Appreciation Rights
     held by such Participant may be exercised, to the extent exercisable at
     Termination of Employment or Termination of Consultancy, by the Participant
     at any time within a period of 90 days from the date of such Termination of
     Employment or Termination of Consultancy, but in no event beyond the
     expiration of the stated term of such Stock Options and Stock Appreciation
     Rights.

               (iii) Voluntary Termination. If a Participant's Termination of
     Employment or Termination of Consultancy is voluntary (other than a
     voluntary termination described in Section 12.2(a)(iv)(B) below), all Stock
     Options and Stock Appreciation Rights held by such Participant may be
     exercised, to the extent exercisable at Termination of Employment or
     Termination of Consultancy, by the Participant at any time within a period
     of 30 days from the date of such Termination of Employment or Termination
     of Consultancy, but in no event beyond the expiration of the stated terms
     of such Stock Options and Stock Appreciation Rights.

               (iv) Termination for Cause. If a Participant's Termination of
     Employment or Termination of Consultancy (A) is for Cause or (B) is a
     voluntary termination (as provided in subsection (iii) above) within 90
     days after an event which would be grounds for a Termination of Employment
     or Termination of Consultancy for Cause, all Stock Options and Stock
     Appreciation Rights held by such Participant shall thereupon terminate and
     expire as of the date of such Termination of Employment or Termination of
     Consultancy.

                                       26
<PAGE>

         (b) Rules Applicable to Restricted Stock. Subject to the applicable
     provisions of the Restricted Stock Award agreement and this Plan, upon a
     Participant's Termination of Employment or Termination of Consultancy for
     any reason during the relevant Restriction Period, all Restricted Stock
     still subject to restriction will vest or be forfeited in accordance with
     the terms and conditions established by the Committee at grant or
     thereafter.

         (c) Rules Applicable to Performance Shares and Performance Units.
     Subject to the applicable provisions of the Award agreement and this Plan,
     upon a Participant's Termination of Employment or Termination of
     Consultancy for any reason during the Performance Period, the Performance
     Cycle or other period or restriction as may be applicable for a given
     Award, the Performance Shares or Performance Units in question will vest
     (to the extent applicable and to the extent permissible under Section
     162(m) of the Code) or be forfeited in accordance with the terms and
     conditions established by the Committee at grant or thereafter.

         (d) Rules Applicable to Other Stock-Based Awards. Subject to the
     applicable provisions of the Award agreement and this Plan, upon a
     Participant's Termination of Employment or Termination of Consultancy for
     any reason during any period or restriction as may be applicable for a
     given Award, the Other Stock- Based Awards in question will vest or be
     forfeited in accordance with the terms and conditions established by the
     Committee at grant or thereafter.

                                  ARTICLE XIII

                    NON-EMPLOYEE DIRECTOR STOCK OPTION GRANTS

     13.1 Stock Options. The terms of this Article XIII shall apply only to
Stock Options granted to Non-Employee Directors.

     13.2 Grants. Without further action by the Board or the stockholders of the
Company, each Non-Employee Director shall, subject to the terms of the Plan, be
granted:

         (a) Stock Options to purchase 20,000 shares of Common Stock as of the
     date the Non-Employee Director begins service as a Non-Employee Director on
     the Board; and

         (b) In addition to Stock Options granted pursuant to (a) above, Stock
     Options to purchase 2,000 shares of Common Stock as of the first day of the
     month following the annual meeting of stockholders of the Company, provided
     he or she has not, as of such day, experienced a Termination of
     Directorship.

     13.3 Non-Qualified Stock Options. Stock Options granted under this Article
XIII shall be Non-Qualified Stock Options.

                                       27
<PAGE>

     13.4 Terms of Stock Options. Stock Options granted under this Article XIII
shall be subject to the following terms and conditions, and shall be in such
form and contain such additional terms and conditions, not inconsistent with the
terms of this Plan, as the Board shall deem desirable:

         (a) Stock Option Price. The Stock Option price per share of Common
     Stock purchasable under a Stock Option shall be determined by the Board at
     the time of grant but shall not be less than 100% of the Fair Market Value
     of the share of Common Stock at the time of grant.

         (b) Stock Option Term. The term of each Stock Option shall be 5 years.

         (c) Exercisability. (i) Stock Options granted to Non-Employee Directors
     pursuant to Section 13.2(a) shall vest and become exercisable as follows:

               Stock Options to purchase 4,000 shares of Common Stock shall be
exercisable on or after the later of (A) 6 months and one day after the date of
grant or (B) the Effective Date;

               Stock Options to purchase 4,000 shares of Common Stock shall be
exercisable on or after the first anniversary of the date that is 6 months and
one day after the date of grant.

               Stock Options to purchase 4,000 shares of Common Stock shall be
exercisable on or after the second anniversary of the date that is 6 months and
one day after the date of grant.

               Stock Options to purchase 4,000 shares of Common Stock shall be
exercisable on or after the third anniversary of the date that is 6 months and
one day after the date of grant.

               Stock Options to purchase 4,000 shares of Common Stock shall be
exercisable on or after the fourth anniversary of the date that is 6 months and
one day after the date of grant.

               (ii) Stock Options granted to Non-Employee Directors pursuant to
     Section 13.2(b) shall be exercisable on or after the later of (A) 6 months
     and one day after the date of grant or (B) the Effective Date.

         (d) Method of Exercise. Subject to whatever waiting period provisions
     apply under subsection (c) above, Stock Options may be exercised in whole
     or in part at any time and from time to time during the Stock Option term,
     by giving written notice of exercise to the Company specifying the number
     of shares to be purchased. Such notice shall be accompanied by payment in
     full of the purchase price as follows: (i) in cash or by check, bank draft
     or money order payable to the Company; (ii) if the Common Stock is traded
     on a national securities exchange, through a "cashless exercise" procedure

                                       28
<PAGE>

     whereby the Participant delivers irrevocable instructions to a broker to
     deliver promptly to the Company an amount equal to the purchase price; or
     (iii) such other arrangement for the satisfaction of the purchase price, as
     the Board may accept. If and to the extent determined by the Board in its
     sole discretion at or after grant, payment in full or in part may also be
     made in the form of Common Stock owned by the Participant for at least 6
     months (and for which the Participant has good title free and clear of any
     liens and encumbrances) based on the Fair Market Value of the Common Stock
     on the payment date. No shares of Common Stock shall be issued until
     payment, as provided herein, therefor has been made or provided for.

         (e) Form, Modification, Extension and Renewal of Stock Options. Subject
     to the terms and conditions and within the limitations of the Plan, a Stock
     Option shall be evidenced by such form of agreement or grant as is approved
     by the Board, and the Board may modify, extend or renew outstanding Stock
     Options granted under the Plan (provided that the rights of a Participant
     are not reduced without his consent).

     13.5 Termination of Directorship. The following rules apply with regard to
Stock Options upon the Termination of Directorship:

         (a) Termination of Directorship by Reason of Death, Disability or
     Otherwise Ceasing to be a Director. Except as otherwise provided herein,
     upon the Termination of Directorship by reason of death, Disability,
     resignation, failure to stand for reelection or failure to be reelected or
     otherwise, all outstanding Stock Options exercisable and not exercised
     shall remain exercisable by the Participant or, in the case of death, by
     the Participant's estate or by the person given authority to exercise such
     Stock Options by his or her will or by operation of law, at any time within
     a period of one year from the date of such Termination of Directorship, but
     in no event beyond the expiration of the stated term of such Stock Option.

         (b) Cancellation of Options. Except as provided in (a) above, no Stock
     Options that were not exercisable as of the date of Termination of
     Directorship shall thereafter become exercisable upon a Termination of
     Directorship for any reason or no reason whatsoever, and such Stock Options
     shall terminate and become null and void upon a Termination of
     Directorship. If a Non-Employee Director's Termination of Directorship is
     for Cause, all Stock Options held by the Non-Employee Director shall
     thereupon terminate and expire as of the date of termination.

     13.6 Acceleration of Exercisability. All Stock Options granted to Non-
Employee Directors and not previously exercisable shall become fully exercisable
immediately upon a Change in Control (as defined herein). For this purpose, a
"Change in Control" shall be deemed to have occurred upon:

         (a) An acquisition by any individual, entity or group (within the
     meaning of Section 13(d)(3) or 14(d)(1) of the Exchange Act) of beneficial
     ownership (within the meaning of Rule 13d-3 promulgated under the Exchange
     Act) of more than 80% of the combined voting power of the then outstanding
     voting securities of Company entitled to

                                       29
<PAGE>

     vote generally in the election of directors, including, but not limited to,
     by merger, consolidation or similar corporate transaction or by purchase;
     excluding, however, the following: (x) any acquisition by the Company, any
     Subsidiary or any Parent, or (y) any acquisition by an employee benefit
     plan (or related trust) sponsored or maintained by the Company, any
     Subsidiary or any Parent; or

         (b) the approval of the stockholders of the Company of (i) a complete
     liquidation or dissolution of the Company or (ii) the sale or other
     disposition of more than 80% of the gross assets of the Company and its
     Subsidiaries and Parent (if any) on a consolidated basis (determined under
     generally accepted accounting principles in accordance with prior
     practice); excluding, however, such a sale or other disposition to a
     corporation with respect to which, following such sale or other
     disposition, (x) more than 20% of the combined voting power of the then
     outstanding voting securities of such corporation entitled to vote
     generally in the election of directors will be then beneficially owned,
     directly or indirectly, by the individuals and entities who were beneficial
     owners of the outstanding shares of Common Stock immediately prior to such
     sale or other disposition, (y) no person (other than the Company, its
     Subsidiaries and Parent (if any), and any employee benefit plan (or related
     trust) of the Company, any Subsidiary or any Parent or such corporation or
     any person beneficially owning, immediately prior to such sale or other
     disposition, directly or indirectly, 20% or more of the outstanding shares
     of Common Stock) will beneficially own, directly or indirectly 20% or more
     of the combined voting power of the then outstanding voting securities of
     such corporation entitled to vote generally in the election or directors,
     and (z) individuals who were members of the incumbent board immediately
     prior to the sale or other disposition will constitute at least a majority
     of the members of the board of directors of such corporation.

     13.7 Changes.

         (a) The Awards to a Non-Employee Director shall be subject to Sections
     4.2(a), (b) and (c) of the Plan and this Section 13.7, but shall not be
     subject to Section 4.2(d).

         (b) If the Company shall not be the surviving corporation in any merger
     or consolidation, or if the Company is to be dissolved or liquidated, then,
     unless the surviving corporation assumes the Stock Options or substitutes
     new Stock Options which are determined by the Board in its sole discretion
     to be substantially similar in nature and equivalent in terms and value for
     Stock Options then outstanding, upon the effective date of such merger,
     consolidation, liquidation or dissolution, any unexercised Stock Options
     shall expire without additional compensation to the holder thereof;
     provided, that, the Board shall deliver notice to each Non-Employee
     Director at least 30 days prior to the date of consummation of such merger,
     consolidation, dissolution or liquidation which would result in the
     expiration of the Stock Options and during the period from the date on
     which such notice of termination is delivered to the consummation of the
     merger, consolidation, dissolution or liquidation, such Participant shall
     have the right to exercise in full, effective as of such consummation, all
     Stock Options that are then outstanding (without regard to limitations on
     exercise otherwise contained in the Stock Options) but

                                       30
<PAGE>

     contingent on occurrence of the merger, consolidation, dissolution or
     liquidation, and, provided that, if the contemplated transaction does not
     take place within a 90 day period after giving such notice for any reason
     whatsoever, the notice, accelerated vesting and exercise shall be null and
     void and, if and when appropriate, new notice shall be given as aforesaid.

                                   ARTICLE XIV

                          CHANGE IN CONTROL PROVISIONS

     14.1 Benefits. In the event of a Change in Control of the Company, except
as otherwise provided by the Committee upon the grant of an Award and except as
provided in Section 13.6 of this Plan with regard to Non-Employee Directors, the
Participant shall be entitled to the following benefits:

         (a) Except to the extent provided in the applicable Award agreement,
     the Participant's employment agreement with the Company or an Affiliate, as
     approved by the Committee, or other written agreement approved by the
     Committee (as such agreement may be amended from time to time), (i) Awards
     granted and not previously exercisable shall not become exercisable upon a
     Change in Control, (ii) restrictions to which any shares of Restricted
     Stock granted prior to the Change in Control are subject shall not lapse
     upon a Change in Control, and (iii) the conditions required for vesting of
     any unvested Performance Units and/or Performance Shares shall not be
     deemed to be satisfied upon a Change in Control.

         (b) The Committee, in its sole discretion, may provide for the purchase
     of any Stock Option by the Company or an Affiliate for an amount of cash
     equal to the excess of the Change in Control Price (as defined below) of
     the shares of Common Stock covered by such Stock Options, over the
     aggregate exercise price of such Stock Options. For purposes of this
     Section 14.1, Change in Control Price shall mean the higher of (i) the
     highest price per share of Common Stock paid in any transaction related to
     a Change in Control of the Company, or (ii) the highest Fair Market Value
     per share of Common Stock at any time during the sixty (60) day period
     preceding a Change in Control.

         (c) Notwithstanding anything to the contrary herein, unless the
     Committee provides otherwise at the time a Stock Option is granted
     hereunder or thereafter, no acceleration of exercisability shall occur with
     respect to such Stock Options if the Committee reasonably determines in
     good faith, prior to the occurrence of the Change in Control, that the
     Stock Options shall be honored or assumed, or new rights substituted
     therefor (each such honored, assumed or substituted stock option
     hereinafter called an "Alternative Option"), by a Participant's employer
     (or the parent or a subsidiary of such employer) immediately following the
     Change in Control, provided that any such Alternative Option must meet the
     following criteria:

                                       31
<PAGE>

               (i) the Alternative Option must be based on stock which is traded
     on an established securities market, or which will be so traded within 30
     days of the Change in Control;

               (ii) the Alternative Option must provide such Participant with
     rights and entitlements substantially equivalent to or better than the
     rights, terms and conditions applicable under such Stock Option, including,
     but not limited to, an identical or better exercise schedule; and

               (iii) the Alternative Option must have economic value
     substantially equivalent to the value of such Stock Option (determined at
     the time of the Change in Control).

     For purposes of Incentive Stock Options, any assumed or substituted Stock
Option shall comply with the requirements of Treasury Regulation (Section)
1.425-1 (and any amendments thereto).

         (d) Notwithstanding anything else herein, the Committee may, in its
     sole discretion, provide for accelerated vesting of an Award or accelerated
     lapsing of restrictions on shares of Restricted Stock at any time.

     14.2 Change in Control. A "Change in Control" shall have the meaning
specified in the applicable Award Agreement, the Participant's employment
agreement with the Company or an Affiliate, as approved by the Committee, or
other written agreement approved by the Committee (as such agreement may be
amended from time to time).

                                   ARTICLE XV

                        TERMINATION OR AMENDMENT OF PLAN

     Notwithstanding any other provision of this Plan, the Board or the
Committee may at any time, and from time to time, amend, in whole or in part,
any or all of the provisions of this Plan (including any amendment deemed
necessary to ensure that the Company may comply with any regulatory requirement
referred to in Article XVII), or suspend or terminate it entirely, retroactively
or otherwise; provided, however, that, unless otherwise required by law or
specifically provided herein, the rights of a Participant with respect to Awards
granted prior to such amendment, suspension or termination, may not be impaired
without the consent of such Participant and, provided further, without the
approval of the shareholders of the Company in accordance with the laws of the
State of Delaware, to the extent required by the applicable provisions of Rule
16b-3 or Section 162(m) of the Code, or, to the extent applicable to Incentive
Stock Options, Section 422 of the Code, no amendment may be made which would (i)
increase the aggregate number of shares of Common Stock that may be issued under
this Plan; (ii) increase the maximum individual Participant limitations for a
fiscal year under Section 4.1(b); (iii) change the classification of employees
or Consultants eligible to receive Awards under this Plan; (iv) decrease the
minimum option price of any Stock Option or Stock Appreciation Right; (v) extend
the maximum option period under Section 6.3; (vi) materially alter the
Performance

                                       32
<PAGE>

Criteria for the Award of Restricted Stock, Performance Units or Performance
Shares as set forth in Exhibit A; or (vii) require stockholder approval in order
for this Plan to continue to comply with the applicable provisions of Section
162(m) of the Code or, to the extent applicable to Incentive Stock Options,
Section 422 of the Code. In no event may this Plan be amended without the
approval of the stockholders of the Company in accordance with the applicable
laws of the State of Delaware to increase the aggregate number of shares of
Common Stock that may be issued under this Plan, decrease the minimum exercise
price of any Stock Option or Stock Appreciation Right, or to make any other
amendment that would require stockholder approval under the rules of any
exchange or system on which the Company's securities are listed or traded at the
request of the Company.

     The Committee may amend the terms of any Award theretofore granted,
prospectively or retroactively, but, subject to Article IV above or as otherwise
specifically provided herein, no such amendment or other action by the Committee
shall impair the rights of any holder without the holder's consent.

                                  ARTICLE XVI

                                  UNFUNDED PLAN

     16.1 Unfunded Status of Plan. This Plan is intended to constitute an
"unfunded" plan for incentive and deferred compensation. With respect to any
payments as to which a Participant has a fixed and vested interest but which are
not yet made to a Participant by the Company, nothing contained herein shall
give any such Participant any rights that are greater than those of a general
creditor of the Company.

                                  ARTICLE XVII

                               GENERAL PROVISIONS

     17.1 Legend. The Committee may require each person receiving shares
pursuant to an Award under this Plan to represent to and agree with the Company
in writing that the Participant is acquiring the shares without a view to
distribution thereof. In addition to any legend required by this Plan, the
certificates for such shares may include any legend which the Committee deems
appropriate to reflect any restrictions on Transfer.

     All certificates for shares of Common Stock delivered under this Plan shall
be subject to such stock transfer orders and other restrictions as the Committee
may deem advisable under the rules, regulations and other requirements of the
Securities and Exchange Commission, any stock exchange upon which the Stock is
then listed or any national securities association system upon whose system the
Stock is then quoted, any applicable Federal or state securities law, and any
applicable corporate law, and the Committee may cause a legend or legends to be
put on any such certificates to make appropriate reference to such restrictions.

                                       33
<PAGE>

     17.2 Other Plans. Nothing contained in this Plan shall prevent the Board
from adopting other or additional compensation arrangements, subject to
shareholder approval if such approval is required; and such arrangements may be
either generally applicable or applicable only in specific cases.

     17.3 No Right to Employment/Consultancy. Neither this Plan nor the grant of
any Award hereunder shall give any Participant or other employee or Consultant
any right with respect to continuance of employment or Consultancy by the
Company or any Affiliate, nor shall they be a limitation in any way on the right
of the Company or any Affiliate by which an employee is employed or a Consultant
is retained to terminate his employment or Consultancy at any time.

     17.4 Withholding of Taxes. The Company shall have the right to deduct from
any payment to be made to a Participant, or to otherwise require, prior to the
issuance or delivery of any shares of Common Stock or the payment of any cash
hereunder, payment by the Participant of, any Federal, state or local taxes
required by law to be withheld. Upon the vesting of Restricted Stock, or upon
making an election under Code Section 83(b), a Participant shall pay all
required withholding to the Company.

     Any such withholding obligation with regard to any Participant may be
satisfied, subject to the consent of the Committee, by reducing the number of
shares of Common Stock otherwise deliverable or by delivering shares of Common
Stock already owned. Any fraction of a share of Common Stock required to satisfy
such tax obligations shall be disregarded and the amount due shall be paid
instead in cash by the Participant.

     17.5 Listing and Other Conditions.

         (a) As long as the Common Stock is listed on a national securities
     exchange or system sponsored by a national securities association, the
     issue of any shares of Common Stock pursuant to an Award shall be
     conditioned upon such shares being listed on such exchange or system. The
     Company shall have no obligation to issue such shares unless and until such
     shares are so listed, and the right to exercise any Stock Option with
     respect to such shares shall be suspended until such listing has been
     effected.

         (b) If at any time counsel to the Company shall be of the opinion that
     any sale or delivery of shares of Common Stock pursuant to an Award is or
     may in the circumstances be unlawful or result in the imposition of excise
     taxes on the Company under the statutes, rules or regulations of any
     applicable jurisdiction, the Company shall have no obligation to make such
     sale or delivery, or to make any application or to effect or to maintain
     any qualification or registration under the Securities Act or otherwise
     with respect to shares of Common Stock or Awards, and the right to exercise
     any Stock Option shall be suspended until, in the opinion of said counsel,
     such sale or delivery shall be lawful or will not result in the imposition
     of excise taxes on the Company.

         (c) Upon termination of any period of suspension under this Section
     17.5, any Award affected by such suspension which shall not then have
     expired or terminated shall

                                       34
<PAGE>

     be reinstated as to all shares available before such suspension and as to
     shares which would otherwise have become available during the period of
     such suspension, but no such suspension shall extend the term of any Stock
     Option.

     17.6 Governing Law. This Plan shall be governed and construed in accordance
with the laws of the State of Delaware (regardless of the law that might
otherwise govern under applicable Delaware principles of conflict of laws).

     17.7 Construction. Wherever any words are used in this Plan in the
masculine gender they shall be construed as though they were also used in the
feminine gender in all cases where they would so apply, and wherever any words
are used herein in the singular form they shall be construed as though they were
also used in the plural form in all cases where they would so apply.

     17.8 Other Benefits. No Award payment under this Plan shall be deemed
compensation for purposes of computing benefits under any retirement plan of the
Company or its subsidiaries nor affect any benefits under any other benefit plan
now or subsequently in effect under which the availability or amount of benefits
is related to the level of compensation.

     17.9 Costs. The Company shall bear all expenses included in administering
this Plan, including expenses of issuing Common Stock pursuant to any Awards
hereunder.

     17.10 No Right to Same Benefits. The provisions of Awards need not be the
same with respect to each Participant, and such Awards to individual
Participants need not be the same in subsequent years.

     17.11 Death/Disability. The Committee may in its discretion require the
transferee of a Participant to supply it with written notice of the
Participant's death or Disability and to supply it with a copy of the will (in
the case of the Participant's death) or such other evidence as the Committee
deems necessary to establish the validity of the transfer of an Award. The
Committee may also require that the agreement of the transferee to be bound by
all of the terms and conditions of this Plan.

     17.12 Section 16(b) of the Exchange Act. All elections and transactions
under this Plan by persons subject to Section 16 of the Exchange Act involving
shares of Common Stock are intended to comply with any applicable exemptive
condition under Rule 16b-3. The Committee may establish and adopt written
administrative guidelines, designed to facilitate compliance with Section 16(b)
of the Exchange Act, as it may deem necessary or proper for the administration
and operation of this Plan and the transaction of business thereunder.

     17.13 Severability of Provisions. If any provision of this Plan shall be
held invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provisions hereof, and this Plan shall be construed and
enforced as if such provisions had not been included.

                                       35
<PAGE>

     17.14 Headings and Captions. The headings and captions herein are provided
for reference and convenience only, shall not be considered part of this Plan,
and shall not be employed in the construction of this Plan.

                                  ARTICLE XVIII

                             EFFECTIVE DATE OF PLAN

     The Plan originally became effective on August 10, 1998 and the amendments
contained herein shall become effective on April 8, 2002, subject to the
approval of the Company's stockholders to the extent and in the manner provided
by applicable law.

                                   ARTICLE XIX

                                  TERM OF PLAN

     No Award shall be granted pursuant to this Plan on or after the tenth
anniversary of the earlier of the date this Plan is adopted or the date of
stockholder approval, but Awards granted prior to such tenth anniversary may
extend beyond that date.

                                       36
<PAGE>

                                    EXHIBIT A

                              PERFORMANCE CRITERIA

     Performance Goals established for purposes of conditioning the grant of an
Award of Restricted Stock based on performance or the vesting of
performance-based Awards of Restricted Stock, Performance Units and/or
Performance Shares shall be based on one or more of the following performance
criteria ("Performance Criteria"): (i) the attainment of certain target levels
of, or a specified percentage increase in, revenues, income before income taxes
and extraordinary items, net income, earnings before income tax, earnings before
interest, taxes, depreciation and amortization, funds from operation of real
estate investments or a combination of any or all of the foregoing; (ii) the
attainment of certain target levels of, or a percentage increase in, after-tax
or pre-tax profits including, without limitation, that attributable to
continuing and/or other operations; (iii) the attainment of certain target
levels of, or a specified increase in, operational cash flow; (iv) the
achievement of a certain level of, reduction of, or other specified objectives
with regard to limiting the level of increase in, all or a portion of, the
Company's bank debt or other long-term or short-term public or private debt or
other similar financial obligations of the Company, which may be calculated net
of such cash balances and/or other offsets and adjustments as may be established
by the Committee; (v) the attainment of a specified percentage increase in
earnings per share or earnings per share from continuing operations; (vi) the
attainment of certain target levels of, or a specified increase in return on
capital employed or return on invested capital; (vii) the attainment of certain
target levels of, or a percentage increase in, after- tax or pre-tax return on
stockholders' equity; (viii) the attainment of certain target levels of, or a
specified increase in, economic value added targets based on a cash flow return
on investment formula; (ix) the attainment of certain target levels in the fair
market value of the shares of the Company's common stock; and (x) the growth in
the value of an investment in the Company's common stock assuming the
reinvestment of dividends. For purposes of item (i) above, "extraordinary items"
shall mean all items of gain, loss or expense for the fiscal year determined to
be extraordinary or unusual in nature or infrequent in occurrence or related to
a corporate transaction (including, without limitation, a disposition or
acquisition) or related to a change in accounting principle, all as determined
in accordance with standards established by Opinion No. 30 of the Accounting
Principles Board.

     In addition, such Performance Criteria may be based upon the attainment of
specified levels of Company (or subsidiary, division or other operational unit
of the Company) performance under one or more of the measures described above
relative to the performance of other corporations. To the extent permitted under
Code Section 162(m), but only to the extent permitted under Code Section 162(m)
(including, without limitation, compliance with any requirements for stockholder
approval), the Committee may: (i) designate additional business criteria on
which the Performance Criteria may be based or (ii) adjust, modify or amend the
aforementioned business criteria.

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