<SUBMISSION>
<ACCESSION-NUMBER>0000950123-01-508437
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>3
<PERIOD>20010930
<FILING-DATE>20011114
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>BKF CAPITAL GROUP INC
<CIK>0000009235
<ASSIGNED-SIC>6282
<IRS-NUMBER>360767530
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>811-02144
<FILM-NUMBER>1787030
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>200 W. MADISON ST.
<STREET2>SUITE 3510
<CITY>CHICAGO
<STATE>IL
<ZIP>60606
<PHONE>2123328400
</BUSINESS-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>BAKER FENTRESS & CO
<DATE-CHANGED>19970829
</FORMER-COMPANY>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>BAKER FENTRESS & CO ET AL
<DATE-CHANGED>19940714
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>y54925e10-q.txt
<DESCRIPTION>BKF CAPITAL GROUP, INC.
<TEXT>
<PAGE>

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

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                                   FORM 10-Q

<Table>
<C>          <S>
 (Mark One)
    [X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
             OF THE SECURITIES EXCHANGE ACT OF 1934



             FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2001



                                   OR




    [ ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
             OF THE SECURITIES EXCHANGE ACT OF 1934



             FOR THE TRANSITION PERIOD FROM           TO
</Table>

                        COMMISSION FILE NUMBER: 1-10024

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

                            BKF CAPITAL GROUP, INC.
             (Exact name of registrant as specified in its charter)

<Table>
<S>                                            <C>
                   DELAWARE                                      36-0767530
       (State or other jurisdiction of                        (I.R.S. Employer
        incorporation or organization)                      Identification No.)

            ONE ROCKEFELLER PLAZA,                                 10020
              NEW YORK, NEW YORK                                 (Zip Code)
   (Address of principal executive offices)
</Table>

              (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
                                 (212) 332-8400

              (FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR,
                         IF CHANGED SINCE LAST REPORT)

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes [X]     No [ ]

     As of October 31, 2001, 6,566,685 shares of the registrant's common stock,
$1.00 par value, were outstanding.

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>

                         PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS.

                    BKF CAPITAL GROUP, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
              (DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
                                  (SEE NOTE 1)

<Table>
<Caption>
                                                              SEPTEMBER 30,   DECEMBER 31,
                                                                  2001            2000
                                                              -------------   ------------
                                                               (UNAUDITED)     (AUDITED)
<S>                                                           <C>             <C>
ASSETS
Cash and cash equivalents...................................    $ 38,977        $ 22,268
Investment advisory fees receivable.........................      25,062          27,842
Investments in securities, at value (cost $2,457 and $2,489,
  respectively).............................................       2,348           2,622
Prepaid expenses and other current assets...................       2,220           2,339
Prepaid income taxes........................................         462              --
Investments in affiliated partnerships......................      14,599          11,860
Fixed assets (net of accumulated depreciation of $2,554 and
  $2,316, respectively).....................................       3,129           3,070
Other assets................................................         621             703
Deferred tax asset..........................................       4,081           6,708
Goodwill....................................................      23,363          23,363
Employment contracts........................................          --          23,363
Investment advisory contracts...............................      70,088          70,088
Accumulated amortization....................................     (44,973)        (60,977)
                                                                --------        --------
          Total assets......................................    $139,977        $133,249
                                                                ========        ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Accrued expenses............................................    $  3,824        $  3,390
Accrued bonuses.............................................      32,554          28,056
Accrued incentive compensation..............................         696             321
Income taxes payable........................................          --             377
Other liabilities...........................................         920             974
                                                                --------        --------
          Total liabilities.................................      37,994          33,118
                                                                --------        --------
STOCKHOLDERS' EQUITY
Common stock, $1 par value, authorized -- 15,000,000 and
  60,000,000 shares, respectively; issued and
  outstanding -- 6,566,685 and 6,518,665 shares,
  respectively..............................................       6,567           6,519
Additional paid-in capital..................................      63,115          62,227
Retained earnings...........................................      32,301          31,385
                                                                --------        --------
          Total stockholders' equity........................     101,983         100,131
                                                                --------        --------
Total liabilities and stockholders' equity..................    $139,977        $133,249
                                                                ========        ========
</Table>

                             See accompanying notes
                                        1
<PAGE>

                    BKF CAPITAL GROUP, INC. AND SUBSIDIARIES

                       CONSOLIDATED STATEMENTS OF INCOME
              (DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
                                  (SEE NOTE 1)

<Table>
<Caption>
                                                                            NINE MONTHS ENDED
                                                 THREE MONTHS ENDED           SEPTEMBER 30,
                                                    SEPTEMBER 30,        -----------------------
                                               -----------------------                PRO FORMA
                                                  2001         2000         2001       2000(A)
                                               ----------   ----------   ----------   ----------
                                                                  (UNAUDITED)
<S>                                            <C>          <C>          <C>          <C>
REVENUES:
Investment advisory fees.....................  $   15,437   $   11,711   $   44,285   $   32,155
Incentive fees...............................       5,804        6,717       23,047       17,669
Commission income -- net.....................         607          437        1,681        1,220
                                               ----------   ----------   ----------   ----------
          Total revenues.....................      21,848       18,865       69,013       51,044
                                               ----------   ----------   ----------   ----------
EXPENSES:
Employee compensation and benefits...........      14,683       13,549       45,976       31,548
Occupancy & equipment rental.................         712          604        1,981        1,698
Other operating expenses.....................       3,379        2,030        9,473        5,759
Amortization of intangibles..................       2,142        2,609        7,359        4,994
                                               ----------   ----------   ----------   ----------
          Total expenses.....................      20,916       18,792       64,789       43,999
                                               ----------   ----------   ----------   ----------
OPERATING INCOME.............................         932           73        4,224        7,045
Other income (expense):
Net realized and unrealized gain (loss) on
  investments................................         446           --        1,139         (380)
Interest and dividend income.................         345          309        1,009          944
Interest expense.............................         (10)         (14)         (28)         (47)
                                               ----------   ----------   ----------   ----------
Income before taxes and cumulative effect of
  change in accounting principle.............       1,713          368        6,344        7,562
                                               ----------   ----------   ----------   ----------
Income taxes.................................         394        1,175        4,997        5,641
Deferred tax expense (benefit)...............         960           --          431       (5,170)
Valuation allowance..........................          --           --           --        5,170
                                               ----------   ----------   ----------   ----------
Income (loss) before cumulative effect of
  change in accounting principle.............         359         (807)         916        1,921
                                               ----------   ----------   ----------   ----------
Cumulative effect to April 18, 2000 of change
  in accounting principle....................          --           --           --      (53,374)
                                               ----------   ----------   ----------   ----------
NET INCOME (LOSS)............................  $      359   $     (807)  $      916   $  (51,453)
                                               ==========   ==========   ==========   ==========
</Table>

                                        2
<PAGE>
                    BKF CAPITAL GROUP, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF INCOME -- (CONTINUED)
              (DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
                                  (SEE NOTE 1)

<Table>
<Caption>
                                                                            NINE MONTHS ENDED
                                                 THREE MONTHS ENDED           SEPTEMBER 30,
                                                    SEPTEMBER 30,        -----------------------
                                               -----------------------                PRO FORMA
                                                  2001         2000         2001       2000(A)
                                               ----------   ----------   ----------   ----------
                                                                  (UNAUDITED)
<S>                                            <C>          <C>          <C>          <C>
Basic earnings (loss) per share(b):
Income (loss) before cumulative effect of
  accounting change..........................  $     0.05   $    (0.12)  $     0.14   $     0.30
Cumulative effect of accounting change.......          --           --           --        (8.21)
                                               ----------   ----------   ----------   ----------
Net income (loss)............................  $     0.05   $    (0.12)  $     0.14   $    (7.91)
                                               ==========   ==========   ==========   ==========
Diluted earnings (loss) per share(b):
Income (loss) before cumulative effect of
  accounting change..........................  $     0.05   $    (0.12)  $     0.12   $     0.29
Cumulative effect of accounting change.......          --           --           --        (8.17)
                                               ----------   ----------   ----------   ----------
Net income (loss)............................  $     0.05   $    (0.12)  $     0.12   $    (7.88)
                                               ==========   ==========   ==========   ==========
Weighted average shares outstanding(b):
Basic........................................   6,565,523    6,504,852    6,534,456    6,504,852
                                               ==========   ==========   ==========   ==========
Diluted......................................   7,391,899    6,504,852    7,354,971    6,534,700
                                               ==========   ==========   ==========   ==========
</Table>

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

(a) Pro forma results have been adjusted for the investment company specific
    income and expenses of BKF Capital Group, Inc. for the period January 1,
    2000 to April 18, 2000 of interest income ($228) and interest expense
    ($406).

(b) Calculation reflects the reverse stock split (which was effectuated January
    7, 2000).

                             See accompanying notes
                                        3
<PAGE>

                    BKF CAPITAL GROUP, INC. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
              (DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
                                  (SEE NOTE 1)

<Table>
<Caption>
                                                              NINE MONTHS ENDED SEPTEMBER 30,
                                                              --------------------------------
                                                                        PRO FORMA   HISTORICAL
                                                               2001       2000       2000(A)
                                                              -------   ---------   ----------
                                                                        (UNAUDITED)
<S>                                                           <C>       <C>         <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)...........................................  $   916   $(51,453)   $ (54,125)
Adjustments to reconcile net income (loss) to net cash
  provided by operations:
  Depreciation and amortization(b)..........................    8,012     58,979       58,780
  Stock based compensation..................................      492        376          251
  Tax benefit related to employee compensation plans........      404         --           --
  Unrealized loss on marketable securities..................     (311)        --           --
  Realized loss on investments..............................       --        108          401
  Changes in operating assets and liabilities:
     (Increase) decrease in investment advisory fees
       receivable...........................................    2,780     (5,968)      (6,827)
     Decrease in prepaid expenses and other current
       assets...............................................      148        250          222
     (Increase) in investments in affiliated investment
       partnerships.........................................   (2,739)    (1,899)      (5,015)
     Decrease in investments in securities..................      585         --           --
     Decrease in deferred income taxes......................    2,627         --           --
     Decrease in other assets...............................       82        310          168
     Increase (decrease) in accrued expenses................      434     (2,658)      (2,331)
     Increase in accrued bonuses............................    4,498      8,334       16,943
     Increase in other liabilities..........................      211         --           --
     Increase (decrease) in income taxes
       payable/receivable...................................     (839)       576         (714)
                                                              -------   --------    ---------
Net cash provided by operating activities...................   17,300      6,955        7,753
                                                              -------   --------    ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Fixed asset additions.......................................     (712)      (299)        (150)
Proceeds from sale of investments...........................       --        892          599
Cash from previously unconsolidated subsidiary..............       --         --       11,873
                                                              -------   --------    ---------
Net cash provided by (used in) investing activities.........     (712)       593       12,322
                                                              -------   --------    ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Payment of loan principal...................................     (265)      (246)        (164)
Issuance of common stock....................................      386         --           --
Cash included in deemed contribution........................       --        178           --
Dividends and capital gain distributions....................       --         --     (480,058)
                                                              -------   --------    ---------
Net cash provided by (used in) financing activities.........      121        (68)    (480,222)
                                                              -------   --------    ---------
Net increase (decrease) in cash and cash equivalents........   16,709      7,480     (460,147)
Cash and cash equivalents at the beginning of the period....   22,268     14,361      481,988
                                                              -------   --------    ---------
Cash and cash equivalents at the end of the period..........  $38,977   $ 21,841    $  21,841
                                                              =======   ========    =========
</Table>

                                        4
<PAGE>
                    BKF CAPITAL GROUP, INC. AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF CASH FLOWS -- (CONTINUED)
              (DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
                                  (SEE NOTE 1)

<Table>
<Caption>
                                                              NINE MONTHS ENDED SEPTEMBER 30,
                                                              --------------------------------
                                                                        PRO FORMA   HISTORICAL
                                                               2001       2000       2000(A)
                                                              -------   ---------   ----------
                                                                        (UNAUDITED)
<S>                                                           <C>       <C>         <C>
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest......................................  $    28   $     49    $      37
                                                              =======   ========    =========
Cash paid for taxes.........................................  $ 5,105   $  5,143    $   4,247
                                                              =======   ========    =========
</Table>

NON-CASH TRANSACTIONS:

     During July 2001, the Company issued 3,232 shares of common stock in
satisfaction of a restricted stock units granted and vested in November 2000.

     During March 2001, the Company granted a total of 7,000 restricted stock
units to the Nonemployee Directors of the Company with a value of $146. Of this
amount, $117 has been used to reduce cash payments to Directors for 2001 Board
of Directors and Committee meetings.

     During the quarter ended March 2000, the Company financed a portion of its
Directors and Officers/ Errors and Omissions insurance policy (premium $910).
---------------

(a) -- The cash flow represents the historical cash flows of BKF Capital Group,
       Inc. (the former registered investment company) for the period January 1,
       2000 to April 18, 2000 and the combined cash flows of the holding company
       for the period April 19, 2000 to September 30, 2000.

(b) -- Includes cumulative effect of change in accounting principle in 2000.

                                See accompanying notes
                                        5
<PAGE>

                    BKF CAPITAL GROUP, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

1.  ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

  ORGANIZATION AND BASIS OF PRESENTATION

     The consolidated interim financial statements of BKF Capital Group, Inc.
(formerly Baker, Fentress & Company, hereto referred to as "BKF" or the
"Company") and its subsidiaries included herein have been prepared in accordance
with generally accepted accounting principles for interim financial information
and Rule 10-01 of Regulation S-X. Accordingly, they do not include all the
information and footnotes required by generally accepted accounting principles
for complete financial statements. These consolidated financial statements are
unaudited and should be read in conjunction with the audited consolidated
financial statements and notes thereto included in the Company's Annual Report
on Form 10-K for the year ended December 31, 2000. The Company follows the same
accounting policies in the preparation of interim reports. In the opinion of
management, the consolidated financial statements reflect all adjustments, which
are of a normal recurring nature, necessary for a fair presentation of the
financial position, results of operations and cash flows of the Company for the
interim periods presented and are not necessarily indicative of a full year's
results.

     In preparing the consolidated financial statements, management is required
to make estimates and assumptions that affect the amounts reported in the
financial statements. Actual results could differ from those estimates.

     Prior to April 18, 2000, BKF operated under the Investment Company Act of
1940 as a non-diversified closed-end management investment company. In August
1999, the Board of Directors and shareholders of BKF adopted and implemented a
Plan for Distribution of Assets ("Plan"), pursuant to which substantially all of
BKF's investment securities were sold. The cash proceeds, as well as shares of
Consolidated-Tomoka Land Company ("CTO"), were subsequently distributed to
shareholders by January 7, 2000. The Company received a deregistration order
from the Securities and Exchange Commission ("SEC") on April 18, 2000,
effectively completing its evolution from an investment company to a holding
company whose primary business now operates through a wholly-owned subsidiary,
Levin Management Co., Inc. and its subsidiaries, all of which are referred to as
"Levco." As of April 2000, financial reporting of BKF reflects Levco on a
consolidated basis. The Company trades on the New York Stock Exchange, Inc.
under the symbol "BKF".

     The Pro Forma Consolidated Statement of Income for the nine month period
ended September 30, 2000 presents the historical results of BKF and Levco giving
effect to the following pro forma adjustments:

     - operating expenses attributable to operating a publicly traded company,
       which were previously borne by BKF;

     - reversal of all investment company specific components of BKF revenue and
       expenses since the Company will have no ongoing operations other than
       that of Levco;

     - amortization expense on intangible assets based on the recasting of the
       June 1996 acquisition of Levco by BKF using the purchase method of
       accounting. This item is non-deductible for income tax purposes;

     - the 1 to 6 reverse stock split effectuated in January 2000.

     The Pro Forma Consolidated Statement of Cash Flows for the period ended
September 30, 2000, reflects the pro forma cash flows of the combined companies
as if BKF had received its deregistration order effective January 1, 2000. BKF
and Levco financial information is being presented on a consolidated basis.

                                        6
<PAGE>
                    BKF CAPITAL GROUP, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                  (UNAUDITED)

 THE PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS ARE PRESENTED SINCE THEY ARE
 MORE REPRESENTATIVE OF THE COMPANY'S OPERATIONS PURSUANT TO THE PLAN.

     The pro forma financial statements do not necessarily represent the results
of operations or the financial position of the Company which actually would have
occurred had the proposed transaction been previously consummated or project the
results of operations or the financial position of the Company for any future
date or period. The SEC approved the application for deregistration of the
Company as a registered investment company on April 18, 2000. Therefore, the
quarter ended June 30, 2000 reflected the non-recurring charge relating to the
change in accounting method for the cumulative effect of the amortization of
intangible assets resulting from recording the Levco transaction under purchase
accounting.

     All numerical information presented in the notes to the consolidated
financial statements has been rounded to the nearest thousand dollars, unless
otherwise noted.

  INCOME TAXES

     The Company accounts for income taxes under the liability method prescribed
by Statement of Financial Accounting Standards ("SFAS") No. 109, "Accounting for
Income Taxes." Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to the differences between the financial statement
carrying amount of existing assets and liabilities and their respective tax
basis. Future tax benefits are recognized only to the extent that realization of
such benefits is more likely than not to occur.

     Prior to April 18, 2000, BKF was a Regulated Investment Company ("RIC"),
which distributed all of its income. It generally was not subject to income
taxes and, therefore, no tax provision was previously recorded. Levco, an
operating company, is subject to federal, state and local taxes on income. The
Pro Forma Consolidated Statement of Income for the nine month period ended
September 30, 2000 reflects a tax provision based upon the pro forma
consolidated results of operations.

  INTANGIBLE ASSETS

     The cost in excess of net assets of Levco acquired by BKF in June 1996 is
reflected as goodwill, employment contracts, and investment advisory contracts
in the Consolidated Statements of Financial Condition at September 30, 2001 and
December 31, 2000. Goodwill is amortized straight line over 15 years and
investment contracts over 10 years. Employment contracts were amortized over the
life of the contract. Whereas the Pro Forma Consolidated Financial Statements
reflect these intangible assets under the purchase accounting method, the
retroactive income effect of recasting this transaction was recorded in the
quarter ended June 30, 2000 as a one-time change in accounting principle charge
to income for all accumulated amortization from June 1996 through April 18,
2000.

  EARNINGS PER SHARE

     The Company has not presented historical earnings per share for the nine
month period ended September 30, 2000 due to the significant changes in its
operations, which are not reflected in the historical financial statements. BKF,
as a registered investment company, presented its net asset value ("NAV") per
share. The pro forma earnings per share are shown using the actual BKF shares
outstanding (adjusted for the 1 to 6 reverse stock split effectuated in January
2000).

     Basic earnings (loss) per share is calculated by dividing net income (loss)
by the weighted average number of common shares outstanding during the period.
Diluted earnings (loss) per share is computed by dividing net income (loss) by
the total of the weighted average number of shares of common stock outstanding
and common stock equivalents. Diluted earnings (loss) per share is computed
using the treasury stock method.

                                        7
<PAGE>
                    BKF CAPITAL GROUP, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                  (UNAUDITED)

     The following table sets forth the computation of basic and diluted
earnings per share (all amounts in thousands, except share and per share data):

<Table>
<Caption>
                                                                            NINE MONTHS ENDED
                                                 THREE MONTHS ENDED           SEPTEMBER 30,
                                                    SEPTEMBER 30,        -----------------------
                                               -----------------------                PRO FORMA
                                                  2001         2000         2001         2000
                                               ----------   ----------   ----------   ----------
<S>                                            <C>          <C>          <C>          <C>
Income (loss) before cumulative effect of
  accounting change..........................  $      359   $     (807)  $      916   $    1,921
Cumulative effect of accounting change.......          --           --           --      (53,374)
                                               ----------   ----------   ----------   ----------
Net income (loss)............................  $      359   $     (807)  $      916   $  (51,453)
                                               ==========   ==========   ==========   ==========
Basic weighted-average shares outstanding....   6,565,523    6,504,852    6,534,456    6,504,852
  Dilutive potential shares from stock
     options and RSU's.......................     826,376           --      820,515       29,848
                                               ----------   ----------   ----------   ----------
Diluted weighted-average shares
  outstanding................................   7,391,899    6,504,852    7,354,971    6,534,700
                                               ==========   ==========   ==========   ==========
Basic earnings (loss) per share:
  Income (loss) before cumulative effect of
     accounting change.......................  $     0.05   $    (0.12)  $     0.14   $     0.30
  Cumulative effect of accounting change.....          --           --           --        (8.21)
                                               ----------   ----------   ----------   ----------
  Net income (loss)..........................  $     0.05   $    (0.12)  $     0.14   $    (7.91)
                                               ==========   ==========   ==========   ==========
Diluted earnings (loss) per share:
  Income (loss) before cumulative effect of
     accounting change.......................  $     0.05   $    (0.12)  $     0.12   $     0.29
  Cumulative effect of accounting change.....          --           --           --        (8.17)
                                               ----------   ----------   ----------   ----------
  Net income (loss)..........................  $     0.05   $    (0.12)  $     0.12   $    (7.88)
                                               ==========   ==========   ==========   ==========
</Table>

  RECENT ACCOUNTING PRONOUNCEMENTS

     In 1998, the Financial Accounting Standards Board issued SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities." SFAS No. 133
establishes accounting and reporting standards for derivative instruments,
including certain derivatives embedded in other contracts and for hedging
activities. SFAS No. 133 generally requires an entity to recognize all
derivatives as either assets or liabilities in the consolidated statement of
financial condition and measure those investments at fair value. SFAS No. 133,
as amended by SFAS No. 137, "Accounting for Derivative Instruments and Hedging
Activities -- Deferral of the Effective Date of FASB Statement No. 133," and
SFAS No. 138, "Accounting for Certain Derivative and Certain Hedging Activities,
an amendment to FASB Statement No. 133," was required to be adopted for fiscal
years beginning after June 15, 2000. The Company adopted the new standard
effective January 1, 2001 and it has not had a material effect on the Company's
results of operations or financial position.

     In June 2001 the Financial Accounting Standards Board issued SFAS No. 142,
"Goodwill and Other Intangible Assets", effective for fiscal years beginning
after December 15, 2001. Under the new rules, goodwill will no longer be
amortized but will be subject to annual impairment tests in accordance with the
Statement. The Company does not anticipate any significant impairment charges
during 2002. Other intangible assets with finite lives will continue to be
amortized over their useful lives.

     The Company will apply the new rules beginning in the first quarter of
2002. Application of the nonamortization provisions of the Statement is expected
to result in an increase in net income of

                                        8
<PAGE>
                    BKF CAPITAL GROUP, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                  (UNAUDITED)

approximately $1.6 million per year. During 2002, the Company will perform the
first of the required impairment tests of goodwill as of January 1, 2002 and has
not yet determined what the effect of these tests will be on the earnings and
financial position of the Company.

     In August 2001, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets." The primary objectives of this statement were to
establish a single accounting model for long-lived assets to be disposed of by
sale, whether previously held and used or newly acquired, and to broaden the
presentation of discontinued operations to include more disposal transactions.
Although Statement 144 supersedes FASB Statement No. 121 on impairment of
long-lived assets, many of the requirements of Statement 121 regarding the test
for and measurement of impairment losses of long-lived assets were retained.
Company will adopt Statement 144 on January 1, 2002. The adoption of this
statement is not expected to have a material impact on Company's results of
operations or financial position.

2.  INCENTIVE FEES AND ALLOCATIONS

     Investment advisory fees receivable and investments in affiliated
partnerships include approximately $13.1 million and $6.3 million of accrued
incentive fees and allocations, respectively, as of September 30, 2001, for
which the full contract measurement period has not been reached. Incentive fees
and allocations for the nine months ended September 30, 2001 include
approximately $9.0 million payable to employee-controlled entities. The Company
has provided for the applicable expenses relating to this revenue. If the
accrued incentive fees and allocations are not ultimately realized, a
substantial portion of the related accrued expenses will be reversed.

3.  STOCKHOLDERS' EQUITY

     The Company effectuated a 1 to 6 reverse stock split on January 7, 2000.
All share numbers and per share amounts in the Company's consolidated financial
statements reflect the reverse split.

     The Company adopted a Share Purchase Rights Plan on May 29, 2001 (the
"Rights Plan"). The Rights Plan was implemented by declaring a dividend,
distributable to stockholders of record on June 18, 2001. With certain
exceptions, the rights become exercisable if a person or group acquires 10% or
more of the Company's outstanding common stock. Such an acquisition causes each
right to be adjusted to permit the holder (other than such person or any member
of such group) to buy a number of additional shares of Common Stock of the
Company having a market value of twice the exercise price of the rights. In
addition, if the Company is involved in a merger or other business combination
at any time after a person or group has acquired 10% or more of the Company's
shares, the Rights will entitle the holder to buy a number of shares of common
stock of the acquiring company having a market value of twice the exercise price
of each right. Rights held by the acquiring person or group become void. The
Company may also redeem the rights for $.01 per right or may exchange each right
for one share of common stock, subject to restrictions set forth in the Rights
Plan. The rights will expire on June 17, 2011.

                                        9
<PAGE>
                    BKF CAPITAL GROUP, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                  (UNAUDITED)

4.  COMMITMENT

     The Company has office space obligations that require monthly payments plus
escalations through September 2011. At September 30, 2001, the minimum annual
rental commitments under the operating lease are as follows:

<Table>
<S>                                                           <C>
Remainder of 2001...........................................  $   748,000
2002........................................................    3,807,000
2003........................................................    3,867,000
2004........................................................    3,870,000
2005........................................................    3,880,000
2006 to September 2011......................................   26,289,000
                                                              -----------
Total minimum payments required.............................  $42,461,000
                                                              ===========
</Table>

                                        10
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS.

INTRODUCTION

     BKF Capital Group, Inc. ("BKF") operates entirely through John A. Levin &
Co., Inc., an investment adviser registered with the U.S. Securities and
Exchange Commission that was acquired by BKF in June 1996. The investment
adviser is a wholly-owned subsidiary of Levin Management Co., Inc., which in
turn is a wholly-owned subsidiary of BKF. Levin Management Co., Inc. and its
subsidiaries are referred to collectively as "Levco." Levco specializes in
managing equity portfolios for institutional and individual investors primarily
in the United States. Most accounts are managed pursuant to large cap value
strategies; Levco also offers event-driven alternative investment products as
well as other more specialized investment programs.

     Levco acts as the managing general partner of a number of investment
partnerships and also acts as an adviser to private investment vehicles
organized outside the United States.

     With respect to accounts managed pursuant to its large cap value
strategies, Levco generally receives advisory fees based on a percentage of the
market value of assets under management, including market appreciation or
depreciation and client contributions and withdrawals. With respect to private
investment vehicles and separate accounts managed pursuant to similar
strategies, Levco is generally entitled to receive both a fixed management fee
based on a percentage of the assets under management and a share of net profits.

     Levco obtains some of its clients for its large cap value products through
wrap fee programs sponsored by major financial services companies. In these
programs, clients pay the sponsoring broker an asset-based fee that covers
brokerage commissions, advisory services, custodial fees, and other reporting
and administrative services. Investors are able to select Levco from among a
limited number of managers participating in the program, and Levco receives a
portion of the wrap fee paid by the clients who select Levco to manage their
accounts through the program.

     At September 30, 2001, assets under management were $12.56 billion, up from
$10.51 billion a year earlier. Following is a comparison of Levco assets under
management (in millions) as defined by product and client type:

<Table>
<Caption>
                                                             SEPTEMBER 30,   SEPTEMBER 30,
                                                                 2001            2000
                                                             -------------   -------------
<S>                                                          <C>             <C>
Institutional..............................................     $ 5,230         $ 4,774
Non-institutional..........................................       1,871           2,104
Event Driven...............................................       1,358             955
Private Investment Funds...................................         333             163
Wrap.......................................................       3,772           2,509
                                                                -------         -------
TOTAL......................................................     $12,564         $10,505
                                                                =======         =======
</Table>

     Levco also has a wholly-owned broker-dealer subsidiary that clears through
Correspondent Services Corporation, a UBS PaineWebber company, on a fully
disclosed basis. Generally, the customers of the broker-dealer subsidiary are
advisory clients of Levco, and the trades executed through the broker-dealer are
generally placed by Levco in its capacity as investment adviser.

     The following discussion and analysis of the results of operations is based
on the actual and pro forma Consolidated Statements of Income and Consolidated
Statements of Financial Condition of BKF Capital Group, Inc. and Subsidiaries.
In light of the evolution of BKF from a closed-end management investment company
to a holding company whose primary asset is the investment management business
of Levco, pro forma statements of operations and cash flows have been included
in Part I -- Item 1 of this Quarterly Report on Form 10-Q in order to provide
meaningful comparisons of financial information for the nine month period ended
September 30, 2000. Management has not included a discussion of historical
financial results of BKF as a closed-end management investment company, as it
completed the distribution of substantially all of its assets on January 7, 2000
pursuant to a Plan of Distribution of Assets approved by shareholders on August
19, 1999 and ceased to be registered as an investment company on April 18, 2000.

                                        11
<PAGE>

     Certain statements under this caption "Management's Discussion and Analysis
of Financial Condition and Results of Operations" constitute "forward-looking
statements" under the Private Securities Litigation Reform Act of 1995 (the
"Reform Act"). See "Part II -- Other Information."

PRO FORMA RESULTS OF OPERATIONS

 THREE MONTHS ENDED SEPTEMBER 30, 2001 AS COMPARED TO THREE MONTHS ENDED
 SEPTEMBER 30, 2000.

  Revenues

     Total revenues for the third quarter of 2001 rose to $21.85 million,
reflecting an increase of 15.8% from the $18.87 million in revenues generated in
the same period in 2000. This increase was primarily attributable to a 31.8%
increase in investment advisory fees (excluding incentive fees) from $11.71
million to $15.44 million. This increase in investment advisory fees resulted
from the increase in assets under management in the large cap value strategy,
which experienced a significant increase in assets managed in wrap fee programs,
and in the event driven product. Assets under management in the event-driven
product include private investment vehicles launched in the third quarter of
2001 pursuing an investment strategy focusing on the debt and securities of
distressed issuers. Incentive fees and general partner incentive allocations
declined 13.6%, from $6.72 million in the third quarter of 2000 to $5.80 million
in the third quarter of 2001. This decrease in incentive fees resulted from the
decrease in incentive fees accrued with respect to the event-driven strategy as
the result of a decrease in performance, which was partially offset by the
increase in incentive fees attributable to investment vehicles following a
short-biased investment strategy. Incentive fees and general partner allocations
are accrued on a quarterly basis but are primarily determined and billed or
allocated, as the case may be, at the end of the applicable contract year or
upon investor withdrawal. Such accruals may be reversed prior to being earned or
allocated as the result of investment performance.

     Commission income generated by the broker-dealer business rose 38.9% from
$437,000 in the third quarter of 2000 to $607,000 in the third quarter of 2001.

  Expenses

     Total expenses for the third quarter of 2001 rose 11.3% from $18.79 million
in the third quarter of 2000 to $20.92 million. Compensation expense rose 8.4%,
from $13.55 million in the third quarter of 2000 to $14.68 million. Compensation
expenses for the third quarter of 2000 included approximately $1.8 million
attributable to the first six months of 2000. This amount was included in third
quarter compensation expense for 2000 as the result of a change in estimate
arising from the adoption of revised compensation guidelines in such quarter.
The increase in compensation expense in the third quarter of 2001 is
attributable to the increase in revenues and the increase of compensation
expense as a percentage of pre-tax, pre-compensation profits under the revised
guidelines, beginning in 2001. All compensation expense related to accrued
incentive fees or general partner incentive allocations is subject to reversal
if the incentive fees or general partner incentive allocations are not
ultimately realized.

     Other operating expenses of BKF rose 66.5% from $2.03 million in the third
quarter of 2000 to $3.38 million in the third quarter of 2001, primarily
reflecting an increase in (i) referral fees paid to third parties, (ii)
consulting fees and (iii) communications and portfolio management software
expenses related to the increase in the number of wrap fee accounts.

     BKF entered into a lease amendment dated September 28, 2001 whereby it
acquired 16,022 square feet in its current location on a floor contiguous with
the floor on which its investment and trading operations are currently
conducted. This lease amendment will result in an additional annual expense of
approximately $1.1 million commencing in the fourth quarter of 2001. BKF is
seeking to sublease or relinquish the 20,231 square feet it acquired by means of
the lease amendment entered into in the second quarter; the space it is seeking
to sublease or relinquish carries an annual expense of $1.3 million. This space
is in the same building as, but not contiguous with, the current operations and
has not yet been occupied.

                                        12
<PAGE>

  Operating Income

     Operating income for the third quarter of 2001 rose to $932,000 from
$73,000 in the third quarter of 2000, reflecting the increase in revenues, which
exceeded the increase in expenses. Excluding the amortization of intangibles
expense, operating income was $3.07 million for the third quarter of 2001, up
from $2.68 million in the year earlier period. As noted above, expenses in the
third quarter of 2000 were increased by approximately $1.8 million of
compensation expense attributable to the first six months of 2000 but included
in the third quarter of 2000 as the result of a change in estimate.

  Gain (Loss) on Investments

     In the third quarter of 2001, BKF had a net realized and unrealized gain on
investments of $446,000, derived primarily from payments received by BKF in
connection with settlements of class action lawsuits relating to securities held
by BKF at such time as it was an investment company. These payments were
partially offset by losses in small cap, small/mid cap and financial services
portfolios established by BKF in the fourth quarter of 2000 to develop such
products. The small cap portfolio was liquidated on August 15, 2001, following
the departure of the portfolio manager managing the product.

  Interest and Dividend Income

     Interest and dividend income increased by 11.7%, from $309,000 in the third
quarter of 2000 to $345,000 in the third quarter of 2001, as increased cash
levels generated by operations were partially offset by the declining interest
rates.

  Income Taxes

     The provision for income taxes decreased 66.5% from $1.18 million in the
third quarter of 2000 to $394,000 in the third quarter of 2001. An effective tax
rate of 47% of income before taxes (as determined without a deduction for the
amortization of intangibles) was used to make the determination with respect to
the provision for taxes at September 30, 2001 and 2000. The decrease in
provision for taxes is due to the overaccrual for certain state taxes made
during prior years. The reversal of the accrual and related claim for
overpayment to various states in prior years was recorded in the third quarter
of 2001 when BKF's 2000 and prior years' amended state tax returns were filed.

 NINE MONTHS ENDED SEPTEMBER 30, 2001 AS COMPARED TO NINE MONTHS ENDED SEPTEMBER
 30, 2000.

  Revenues

     Total revenues for the first nine months of 2001 rose to $69.01 million,
reflecting an increase of 35.2% from the $51.04 million in revenues generated in
the same period in 2000. This increase was mostly attributable to (i) a 37.7%
increase in investment advisory fees (excluding incentive fees) from $32.16
million to $44.29 million and (ii) a 30.4% increase in incentive fees and
general partner incentive allocations from $17.67 million to $23.05 million. The
increase in investment advisory fees is primarily attributable to the increase
in assets under management in the large cap value strategy, which experienced a
significant increase in assets managed in wrap fee programs, and in the event
driven products. The increase in incentive fees is primarily attributable to the
increase in assets under management in the event driven strategy as well as in
other alternative strategies. Incentive fees and general partner allocations are
accrued on a quarterly basis but are primarily determined and billed or
allocated, as the case may be, at the end of the applicable contract year or
upon investor withdrawal. Such accruals may be reversed prior to being earned or
allocated as the result of investment performance.

     Commission income generated by the broker-dealer business rose 37.8% from
$1.22 million in the first nine months of 2000 to $1.68 million in the first
nine months of 2001.

                                        13
<PAGE>

  Expenses

     Total expenses for the first nine months of 2001 rose 47.3% from $44.00
million to $64.79 million. The largest component of this increase was a 45.7%
increase in compensation expense, which rose from $31.55 million to $45.98
million. This increase in compensation expense is attributable to the increase
in revenues and the implementation of the revised compensation guidelines
approved by the Compensation Committee in the third quarter of 2000, which
revised guidelines increased compensation expense as a percentage of pre-tax,
pre-compensation profits, beginning in 2001. All compensation expense related to
accrued incentive fees or general partner incentive allocations is subject to
reversal if the incentive fees or general partner incentive allocations are not
ultimately realized.

     Other operating expenses of BKF rose 64.5% from $5.76 million in the first
nine months of 2000 to $9.47 million in the first nine months of 2001, primarily
reflecting an increase in (i) referral fees paid to third parties, (ii)
consulting fees, (iii) reimbursements to certain client accounts in connection
with trading activities, and (iv) communications and portfolio management
software expenses related to the increase in the number of wrap fee accounts.

     The increase in amortization of intangibles expense from $4.99 million to
$7.36 million for the respective nine month periods ended September 30 is
primarily attributable to the fact that the amortization expense in 2000 did not
reflect the period from January 1, 2000 through April 18, 2000, since the
amortization attributable to this period was included in the cumulative effect
of change in accounting principle that was recorded on April 18, 2000.

     BKF entered into a lease amendment dated September 28, 2001 whereby it
acquired 16,022 square feet in its current location on a floor contiguous with
the floor on which its investment and trading operations are currently
conducted. This lease amendment will result in an additional annual expense of
approximately $1.1 million commencing in the fourth quarter of 2001. BKF is
seeking to sublease or relinquish the 20,231 square feet it acquired by means of
the lease amendment entered into in the second quarter; the space it is seeking
to sublease or relinquish carries an annual expense of $1.3 million. This space
is in the same building as, but not contiguous with, the current operations and
has not yet been occupied.

  Operating Income

     Operating income for the first nine months of 2001 declined 40.1% from
$7.05 million in the first nine months of 2000 to $4.22 million, reflecting the
increase in expenses, which exceeded the increase in revenues. Excluding the
amortization of intangibles expense, operating income was $11.58 million for the
first nine months of 2001, down from $12.04 million in the year earlier period.

  Gain (Loss) on Investments

     In the first nine months of 2001, BKF had a net realized and unrealized
gain on investments of $1.14 million, derived primarily from (i) payments
received by BKF in connection with settlements of class action lawsuits relating
to securities held by BKF at such time as it was an investment company and (ii)
the BKF portfolios established in the fourth quarter of 2000 to seed Levco's
small cap, small/mid cap and financial services long only products. The small
cap portfolio was liquidated on August 15, 2001 following the departure of the
portfolio manager managing the product. In the first quarter of 2000, BKF
realized a non-cash loss of $223,000 through the permanent write down of a
historical private placement position that had been part of BKF's portfolio when
it was an investment company. This net loss was comprised of a write down of the
position from $1,000,000 to $599,000, and the accrual of $178,000 in interest
with respect to the investment that was reflected in the interest income for the
first quarter of 2000. Net realized and unrealized loss on investments for the
2000 period also included $21,000 received as part of a class action settlement
relating to a position held in BKF's portfolio when it was an investment
company.

                                        14
<PAGE>

  Interest and Dividend Income

     Interest and dividend income increased by 6.9%, from $944,000 in the first
nine months of 2000 to $1.01 million in the first nine months of 2001, as
increased cash levels generated by operations were partly offset by declining
interest rates.

  Income Taxes

     The provision for income taxes decreased by 11.4% from $5.64 million in the
first nine months of 2000 to $5.00 million in the first nine months of 2001. An
effective tax rate of 47% of income before taxes (as determined without a
deduction for the amortization of intangibles) was used to make the
determination with respect to the provision for taxes at September 30, 2001 and
2000. The decrease in the provision for income taxes is due to the overaccrual
for certain state taxes made during prior years. The reversal of the accrual and
related claim for overpayment to various states in prior years was recorded in
the third quarter of 2001 when BKF's 2000 and prior years' amended state tax
returns were filed.

LIQUIDITY AND CAPITAL RESOURCES

     BKF's current assets as of September 30, 2001 consist primarily of cash,
short term investments and advisory fees receivable.

     BKF has historically met its cash and liquidity needs through cash
generated by operating activities. At September 30, 2001, BKF had cash and cash
equivalents of $38.98 million, compared to $22.27 million at December 31, 2000.
This increase in cash and cash equivalents reflects the collection of
receivables and the annual withdrawal of general partner incentive allocations
from the investment partnerships managed by Levco, which were partially offset
by the payment of cash bonuses in 2001 that were accrued in 2000. BKF also
received (i) $379,000 in cash (net of taxes withheld) as the result of the
exercise of employee stock options and the delivery of stock underlying
restricted stock units and (ii) a tax refund of $2.20 million relating to the
carryback of a capital loss derived from a private placement investment made by
BKF when it was a registered investment company. The decrease in investment
advisory fees receivable from $27.84 million at December 31, 2000 to $25.06
million at September 30, 2001 primarily reflects the receipt of incentive fees
earned in 2000. The increase in investments in affiliated investment
partnerships to $14.60 million at September 30, 2001 from $11.86 million at
December 31, 2000 reflects the accrual of incentive allocations for the nine
month period ended September 30, 2001 and the investment by BKF of $6.0 million
to support limited partnerships being developed by Levco. These amounts were
partially offset by the withdrawal of general partner incentive allocations from
the partnerships earned with respect to 2000.

     The 10.4% decrease in investments in securities from $2.62 million to $2.35
million primarily reflects (i) the liquidation of the small cap portfolio on
August 15, 2001, following the departure of the portfolio manager managing the
product and (ii) the net depreciation on investments made to seed Levco's
small/mid cap and financial services long only equity products. These amounts
were partially offset by an investment of $500,000 in a non-US based private
investment vehicle being developed by Levco.

     Accrued expenses increased by 12.8% to $3.82 million at September 30, 2001
from $3.39 million at December 31, 2000, principally as the result of the
increase in referral fees owed to third parties, which was partially offset by
the payment of third party marketing fees accrued in 2000 that were contingent
on the receipt of incentive fees and general partner incentive allocations. The
increase in accrued bonuses from $28.06 million at December 31, 2000 to $32.55
million at September 30, 2001 reflects the accrual for 2001 bonuses, which was
partially offset by the payment of 2000 bonuses. The change from an income taxes
payable of $377,000 at December 31, 2000 to prepaid income taxes of $462,000 at
September 30, 2001 reflects (i) the timing of tax payments, (ii) the income tax
benefit derived from the exercise of employee stock options and (iii) the
overpayment of estimated 2000 state and local taxes (as actual state and local
tax allocations were lower than estimated).

     Other liabilities declined 5.5% from $974,000 at December 31, 2000 to
$920,000 at September 30, 2001. At September 30, 2001, such liabilities included
(i) amounts due for a duplicate payment made with regard to

                                        15
<PAGE>

a class action settlement, (ii) payments made on a loan used to finance BKF's
errors and omissions/directors and officers insurance coverage, and (iii)
amounts due with regard to pending trades in the seed capital portfolios.

     Based upon BKF's current level of operations and anticipated growth, BKF
expects that cash flows from operating activities will be sufficient to finance
its working capital needs for the foreseeable future. BKF has no material
commitments for capital expenditures.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

     Since BKF's revenues are largely driven by the market value of Levco's
assets under management, these revenues are exposed to fluctuations in the
equity markets. Management fees for most accounts are determined based on the
market value of the account on the last day of the quarter, so any significant
increases or decreases in market value occurring on or shortly before the last
day of a quarter may materially impact revenues. Furthermore, since Levco
manages most of its assets in a large cap value style, a general decline in the
performance of value stocks could have an adverse impact on Levco's revenues.
Similarly, a lack of opportunity to implement, or a failure to successfully
implement, Levco's event-driven strategy, could reduce performance based
incentive fees and allocations and thereby negatively impact BKF's revenues.
Because BKF is primarily in the asset management business and manages equity
portfolios, changes in interest rates, foreign currency exchange rates,
commodity prices or other market rates or prices impact BKF only to the extent
they are reflected in the equity markets.

                          PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

None

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

None

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not applicable.

ITEM 5.  OTHER INFORMATION

     This Quarterly Report on Form 10-Q contains certain statements that are not
historical facts, including, most importantly, information concerning possible
or assumed future results of operations of BKF and statements preceded by,
followed by or that include the words "may," "believes," "expects,"
"anticipates," or the negation thereof, or similar expressions, which constitute
"forward-looking statements" within the meaning of the Reform Act. For those
statements, BKF claims the protection of the safe harbor for forward-looking
statements contained in the Reform Act. These forward-looking statements are
based on BKF's current expectations and are susceptible to a number of risks,
uncertainties and other factors, and BKF's actual results, performance and
achievements may differ materially from any future results, performance or
achievements expressed or implied by such forward-looking statements. Such
factors include the following: retention and ability of qualified personnel; the
performance of the securities markets and of value stocks in particular; the
investment performance of client accounts; the retention of significant client
and/or distribution relationships; competition; the existence or absence of
adverse publicity; changes in business strategy; quality of management;
availability, terms and deployment of capital; business abilities and judgment
of personnel; labor and employee benefit costs; changes in, or failure to comply
with, government regulations; the costs and
                                        16
<PAGE>

other effects of legal and administrative proceedings; and other risks and
uncertainties referred to in this document and in BKF's other current and
periodic filings with the Securities and Exchange Commission, all of which are
difficult or impossible to predict accurately and many of which are beyond BKF's
control. BKF will not undertake and specifically declines any obligation to
publicly release the result of any revisions which may be made to any
forward-looking statements to reflect events or circumstances after the date of
such statements or to reflect the occurrence of anticipated or unanticipated
events. In addition, it is BKF's policy generally not to make any specific
projections as to future earnings, and BKF does not endorse any projections
regarding future performance that may be made by third parties.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     (a) Exhibits

<Table>
<Caption>
EXHIBIT NO.                           DESCRIPTION
-----------                           -----------
<C>           <S>
  3(ii)       Amended By-laws
   10.2       Sixth Amendment to Lease dated September 28, 2001
</Table>

     (b) Reports on Form 8-K

     None.

                                        17
<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                          BKF CAPITAL GROUP, INC.

                                          By:       /s/ JOHN A. LEVIN
                                            ------------------------------------
                                                       John A. Levin
                                             Chairman, Chief Executive Officer
                                                       and President

                                          By:      /s/ GLENN A. AIGEN
                                            ------------------------------------
                                                       Glenn A. Aigen
                                                 Senior Vice President and
                                                  Chief Financial Officer

Date: November 14, 2001

                                        18

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3.II
<SEQUENCE>3
<FILENAME>y54925ex3-ii.txt
<DESCRIPTION>AMENDED BY-LAWS
<TEXT>
<PAGE>

                                                                   EXHIBIT 3(ii)

                                     BYLAWS

                                       OF

                            BKF CAPITAL GROUP, INC.

                         AS AMENDED AND RESTATED AS OF

                               SEPTEMBER 25, 2001
<PAGE>

                               TABLE OF CONTENTS

<Table>
<Caption>
                                                              PAGE
                                                              ----
<S>                                                           <C>
ARTICLE I -- STOCKHOLDERS...................................    1
     SECTION 1.1 Annual Meeting.............................    1
     SECTION 1.2 Special Meetings...........................    1
     SECTION 1.3 Notice of Meetings.........................    1
     SECTION 1.4 Adjournment of Meetings....................    1
     SECTION 1.5 Quorum at Meetings.........................    1
     SECTION 1.6 Nominations and Business at Meetings.......    2
     SECTION 1.7 Organization and Conduct of Meetings.......    3
     SECTION 1.8 Required Vote..............................    3
     SECTION 1.9 Voting; Proxies............................    3
     SECTION 1.10 No Action by Written Consent..............    4
     SECTION 1.11 Record Dates for Meetings and Other
      Purposes..............................................    4
     SECTION 1.12 List of Stockholders Entitled to Vote.....    4
     SECTION 1.13 Inspectors of Election....................    4
     SECTION 1.14 Stockholders of Record....................    5
ARTICLE II -- BOARD OF DIRECTORS............................    5
     SECTION 2.1 Powers.....................................    5
     SECTION 2.2 Number, Classification, Election, Term of
      Office and Qualifications.............................    5
     SECTION 2.3 Resignation, Removal and Vacancies.........    5
     SECTION 2.4 Newly Created Directorships................    5
     SECTION 2.5 Annual Meeting.............................    5
     SECTION 2.6 Regular Meetings...........................    6
     SECTION 2.7 Special Meetings...........................    6
     SECTION 2.8 Telephonic Meetings Permitted..............    6
     SECTION 2.9 Quorum; Vote Required for Action...........    6
     SECTION 2.10 Organization of Meetings..................    6
     SECTION 2.11 Action by Written Consent.................    6
     SECTION 2.12 Committees of the Board...................    6
     SECTION 2.13 Notices to Directors......................    7
     SECTION 2.14 Waiver of Notice..........................    7
     SECTION 2.15 Compensation of Directors.................    7
ARTICLE III -- OFFICERS.....................................    8
     SECTION 3.1 Officers...................................    8
     SECTION 3.2 Term of Office; Resignation; Removal;
      Vacancies.............................................    8
     SECTION 3.3 Compensation of Officers...................    8
     SECTION 3.4 Powers and Duties of Officers..............    8
     SECTION 3.5 Chief Executive Officer....................    8
     SECTION 3.6 Chairman of the Board......................    8
     SECTION 3.7 Vice Chairman of the Board.................    9
     SECTION 3.8 President..................................    9
     SECTION 3.9 Vice Presidents............................    9
     SECTION 3.10 Secretary.................................    9
</Table>

                                        i
<PAGE>

<Table>
<Caption>
                                                              PAGE
                                                              ----
<S>                                                           <C>
     SECTION 3.11 Assistant Secretaries.....................    9
     SECTION 3.12 Treasurer.................................    9
     SECTION 3.13 Assistant Treasurers......................   10
ARTICLE IV -- STOCK.........................................   10
     SECTION 4.1 Certificates...............................   10
     SECTION 4.2 Lost, Stolen or Destroyed Certificates;
      Issuance of New Certificates..........................   10
     SECTION 4.3 Registration of Transfers..................   10
     SECTION 4.4 The Stock Ledger...........................   10
ARTICLE V -- INDEMNIFICATION AND ADVANCEMENT OF EXPENSES....   11
     SECTION 5.1 Right to Indemnification...................   11
     SECTION 5.2 Advancement of Expenses....................   11
     SECTION 5.3 Claims.....................................   12
     SECTION 5.4 Nonexclusivity of Rights; Purchase of
      Insurance.............................................   12
     SECTION 5.5 Provisions Deemed a Contract...............   12
     SECTION 5.6 Conclusive Presumption.....................   12
     SECTION 5.7 Other Indemnification......................   12
ARTICLE VI -- MISCELLANEOUS PROVISIONS......................   13
     SECTION 6.1 Offices and Books and Records..............   13
     SECTION 6.2 Fiscal Year................................   13
     SECTION 6.3 Seal.......................................   13
     SECTION 6.4 Form of Records............................   13
     SECTION 6.5 Signing of Checks, Notes, etc. ............   13
     SECTION 6.6 Voting of Shares in Other Companies........   13
     SECTION 6.7 Amendment of Bylaws........................   13
</Table>

                                        ii
<PAGE>

                                     BYLAWS
                                       OF
                            BKF CAPITAL GROUP, INC.
                         AS AMENDED AND RESTATED AS OF
                               SEPTEMBER 25, 2001
                             ---------------------

                                   ARTICLE I

                                  STOCKHOLDERS

     SECTION 1.1 Annual Meeting.  An annual meeting of stockholders shall be
held at such place, date and hour as may be determined by resolution of the
board of directors from time to time. At the annual meeting, the stockholders
shall elect directors as provided in the Restated Certificate of Incorporation
of the Company and transact such other business as may properly come before the
meeting in accordance with Section 1.6 of these Bylaws.

     SECTION 1.2 Special Meetings.  Special meetings of stockholders for any
purpose or purposes may be called at any time by the chief executive officer and
shall be called by the president or the secretary at the request in writing of a
majority of the members of the whole board of directors. Such request shall
state the purpose or purposes of the proposed special meeting. Except as
otherwise prescribed by the Delaware General Corporation Law or the Restated
Certificate of Incorporation, special meetings of stockholders may not be called
by any other person or persons. The date, time and place of any properly called
special meeting shall be determined by the chief executive officer. The business
transacted at any special meeting of stockholders shall be limited to the
purpose or purposes for which the meeting is called stated in the Company's
notice of the meeting pursuant to Section 1.3 of these Bylaws.

     SECTION 1.3 Notice of Meetings.  Whenever stockholders are required or
permitted to take any action at a meeting, annual or special, a written notice
of the meeting shall be given to each stockholder entitled to vote at such
meeting that shall state the place, date and hour of the meeting and the purpose
or purposes for which the meeting is called. Unless otherwise provided by the
Delaware General Corporation Law, the Restated Certificate of Incorporation or
these Bylaws, the written notice of any meeting shall be given not less than 10
nor more than 60 days before the date of the meeting to each stockholder
entitled to vote at such meeting. If mailed, such notice shall be deemed to be
given when deposited in the United States mail, postage prepaid, directed to the
stockholder at his, her or its address as it appears on the records of the
Company. Any meeting of stockholders as to which notice has previously been
given may at any time prior to its commencement be canceled by resolution of the
board of directors.

     SECTION 1.4 Adjournment of Meetings.  Any meeting of stockholders, annual
or special, may adjourn from time to time to reconvene at the same or some other
place, and notice need not be given of any such adjourned meeting if the time
and place thereof are announced at the meeting at which the adjournment is
taken. At the adjourned meeting the Company may transact any business which
might have been transacted at the original meeting. If the adjournment is for
more than 30 days, or if after the adjournment a new record date is fixed for
the adjourned meeting, notice of the adjourned meeting shall be given to each
stockholder of record entitled to vote at the meeting.

     SECTION 1.5 Quorum at Meetings.  Except as otherwise provided by the
Delaware General Corporation Law, the Restated Certificate of Incorporation or
these Bylaws, at each meeting of stockholders the presence in person or by proxy
of the holders of a majority in voting power of the outstanding shares of stock
entitled to vote at the meeting shall be necessary and sufficient to constitute
a quorum. In the absence of a quorum, the stockholders so present may, by
majority vote, adjourn the meeting from time to time in the manner provided in
Section 1.4 of these Bylaws until a quorum shall attend. Shares of its own stock
belonging to the Company or to another corporation, if a majority of the shares
entitled to vote in the election of directors of such other corporation is held,
directly or indirectly, by the Company, shall neither be entitled to vote nor be
counted for quorum purposes; provided, however, that the foregoing shall not
limit the right of the
<PAGE>

Company or any subsidiary of the Company to vote stock, including but not
limited to its own stock, held by it in a fiduciary capacity.

     SECTION 1.6 Nominations and Business at Meetings.  (a) Nominations of
persons for election as directors of the Company at any meeting of stockholders
called for the election of directors may be made by or at the direction of the
board of directors or by a stockholder who is entitled to vote at such meeting
and who complies with the applicable provisions of this Section 1.6. For a
nomination of any person for election as a director of the Company to be
properly made by a stockholder at any meeting, the stockholder must have given
timely advance notice thereof in writing to the secretary of the Company.

     (b) At any meeting of stockholders, only business shall be conducted which
has been properly brought before the meeting. To be properly brought before a
meeting of stockholders, business must be specified in the notice of meeting
given by, or at the direction of, the board of directors or otherwise properly
brought before the meeting by or at the direction of the board of directors or
by a stockholder who is entitled to vote at such meeting. For business to be
properly brought before a meeting by a stockholder, the business must, under the
laws of Delaware, be a proper subject for stockholder action, and the
stockholder must have given timely advance notice thereof in writing to the
secretary of the Company.

     (c) To be timely, a stockholder's notice of his intention to nominate a
person for election as a director at any meeting pursuant to paragraph (a) of
this Section 1.6 or to bring other business before any meeting pursuant to
paragraph (b) of this Section 1.6 must in either case be delivered to or mailed,
postage prepaid, and received by the secretary at the Company's headquarters:

          (i) for an annual meeting, not less than 60 days before the date on
     which the Company first mailed its proxy materials for the prior year's
     annual meeting; provided, however, that if the date of the current year's
     annual meeting has been advanced by more than 30 days from the date of the
     prior year's annual meeting, then such notice must be received by the
     secretary not later than the close of business on the tenth day following
     the date on which the Company first makes public disclosure of the date of
     the meeting; and

          (ii) for a special meeting, not later than the close of business on
     the tenth day following the date on which the Company first makes public
     disclosure of the date of the meeting.

For purposes of this Section 1.6, "public disclosure" shall mean disclosure by
the Company in a press release reported by the Dow Jones News Service or
comparable national news service or in a document publicly filed by the Company
with the Securities and Exchange Commission.

     (d) Any notice given by a stockholder pursuant to paragraph (a) of this
Section 1.6 shall set forth: (i) the name and address of the stockholder who
intends to make the nomination, as they appear on the Company's stock ledger,
and of the beneficial owner, if any, on whose behalf the nomination is made;
(ii) the name, age, business address and, if known, residence address of the
nominee; (iii) the principal occupation or employment of the nominee; (iv) the
class and number of shares of stock of the Company which are beneficially owned
by the nominee and by the nominating stockholder and any such beneficial owner
on whose behalf the nomination is made; (v) any other information concerning the
nominee that must be disclosed with respect to nominees in a proxy statement
pursuant to Regulation 14A under the Securities Exchange Act of 1934; and (vi)
the executed consent of the nominee to serve as a director of the Company, if
elected. The Company may require any such nominee to furnish such other
information as may reasonably be required to determine the eligibility of the
nominee to be a director of the Company.

     (e) Any notice given by a stockholder pursuant to paragraph (b) of this
Section 1.6 shall set forth (i) a brief description of the business which the
stockholder desires to bring before the meeting, (ii) the name and address of
the stockholder giving the notice, as they appear on the Company's stock ledger,
and of the beneficial owner, if any, on whose behalf such notice is given, (iii)
the class and number of shares of stock of the Company which are beneficially
owned by the stockholder giving the notice and by any such beneficial owner and
(iv) the reasons for conducting such business at the meeting and any material
interest in such business of such stockholder and any such beneficial owner. The
Company may require any such stockholder

                                        2
<PAGE>

to furnish such other information as may reasonably be required to determine
whether any such proposed item of business is a proper subject for stockholder
action.

     (f) In addition to, and not in limitation of, the provisions of this
Section 1.6, a stockholder shall also comply with all applicable requirements of
the Securities Exchange Act of 1934 and the rules and regulations thereunder
with respect to any nomination of a person for election as a director of the
Company or with respect to the proposal of any other business, as the case may
be, which such stockholder wishes to make or present at any meeting of
stockholders of the Company.

     SECTION 1.7 Organization and Conduct of Meetings.  (a) The chairman of the
board of the Company shall be the chairman of, and shall preside at, all annual
and special meetings of stockholders. In the event of the absence of the
chairman of the board from any meeting of stockholders, the meeting will be
presided over by the president of the Company or, in his or her absence, by a
chairman designated by the board of directors, or in the absence of such
designation by a chairman chosen by the meeting. The secretary of the Company
shall act as secretary of the meeting, but in his or her absence the chairman of
the meeting may appoint any person to act as secretary of the meeting.

     (b) The date and time of the opening and the closing of the polls for each
matter upon which the stockholders will vote at a meeting shall be announced at
the meeting by the chairman of the meeting. The board of directors of the
Company may adopt by resolution such rules and regulations for the conduct of
any or all meetings of stockholders as it shall deem appropriate. Except to the
extent inconsistent with such rules and regulations, if any, as adopted by the
board of directors, the chairman of any meeting of stockholders shall have the
right and authority to prescribe such rules, regulations and procedures and to
do all such acts as, in the judgment of such chairman, are appropriate for the
proper conduct of the meeting. Such rules, regulations or procedures, whether
adopted by the board of directors or prescribed by the chairman of the meeting,
may include, without limitation, the following: (i) the establishment of an
agenda or order of business for the meeting; (ii) rules and procedures for
maintaining order at the meeting and the safety of those present; (iii)
limitations on attendance at or participation in the meeting to stockholders of
record of the Company, their duly authorized and constituted proxies or such
other persons as the chairman of the meeting shall determine; (iv) restrictions
on entry to the meeting after the time fixed for the commencement thereof; and
(v) limitations on the time allotted to questions or comments by participants.
Except to the extent determined otherwise by the board of directors or the
chairman of the meeting, meetings of stockholders shall not be required to be
held in accordance with the rules of parliamentary procedure.

     (c) The chairman of the meeting shall have the power and duty to determine
whether a nomination of a person for election as a director of the Company or
any other business proposed to be brought before the meeting was made or brought
in accordance with the procedures set forth in Section 1.6 of these Bylaws and
Article Sixth of the Restated Certificate of Incorporation and, if any proposed
nomination or other business is not in such compliance, to declare that such
defective nomination or proposal shall be disregarded.

     SECTION 1.8 Required Vote.  A plurality of the votes cast at any meeting
for the election of directors shall be sufficient to elect. Except as otherwise
provided by the Delaware General Corporation Law, the Restated Certificate of
Incorporation or these Bylaws, all matters other than the election of directors
submitted to the stockholders at any meeting shall be decided by the affirmative
vote of the holders of a majority in voting power of the shares of stock which
are present in person or by proxy and entitled to vote thereon.

     SECTION 1.9 Voting; Proxies.  (a) Except as otherwise provided by law or by
the Restated Certificate of Incorporation, each stockholder entitled to vote at
any meeting of stockholders shall be entitled to one vote for each share of
stock held by him, her or it which has voting power upon the matter in question.
Each stockholder entitled to vote at a meeting of stockholders may authorize
another person or persons to act for him, her or it by proxy, but no such proxy
shall be voted or acted upon after three years from its date, unless the proxy
provides for a longer period. To be valid, a proxy must be filed with the
secretary of the Company or his or her representative at or before the time of
the meeting at which it is intended that it be voted or acted upon. A proxy
shall be irrevocable if it states that it is irrevocable and if, and only as
long as, it is coupled with an interest sufficient in law to support an
irrevocable power. A stockholder may revoke any proxy which is not

                                        3
<PAGE>

irrevocable by attending the meeting and voting in person or by filing an
instrument in writing revoking the proxy or by delivering to the secretary of
the Company a proxy in accordance with applicable law bearing a later date.
Except as otherwise provided in the Restated Certificate of Incorporation or as
determined by the chairman of the meeting, voting at any meeting of stockholders
need not be by written ballot.

     SECTION 1.10 No Action by Written Consent.  Any action required or
permitted to be taken at any annual or special meeting of stockholders must be
taken at such a meeting duly called, upon proper notice to all stockholders
entitled to vote. No action required to be taken or which may be taken at any
annual or special meeting of stockholders may be taken without a meeting,
without prior notice and without a vote.

     SECTION 1.11 Record Dates for Meetings and Other Purposes.  In order that
the Company may determine the stockholders entitled to notice of or to vote at
any meeting of stockholders or any adjournment thereof, or entitled to receive
payment of any dividend or other distribution or allotment of any rights, or
entitled to exercise any rights in respect of any change, conversion or exchange
of stock or for the purpose of any other lawful action, the board of directors
may fix a record date, which record date shall not precede the date upon which
the resolution fixing the record date is adopted by the board of directors, and
which record date: (i) in the case of a determination of stockholders entitled
to vote at any meeting of stockholders or adjournment thereof, shall, unless
otherwise required by the Delaware General Corporation Law, not be more than 60
nor less than 10 days before the date of such meeting; and (ii) in the case of
any other action, shall not be more than 60 days prior to such other action. If
no record date is fixed: (i) the record date for determining stockholders
entitled to notice of or to vote at a meeting of stockholders shall be at the
close of business on the day next preceding the day on which notice is given,
or, if notice is waived, at the close of business on the day next preceding the
day on which the meeting is held; (ii) the record date for determining
stockholders for any other purpose shall be at the close of business on the day
on which the board of directors adopts the resolution relating thereto. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting; provided,
however, that the board of directors may fix a new record date for the adjourned
meeting.

     SECTION 1.12 List of Stockholders Entitled to Vote.  The secretary of the
Company shall prepare and make, at least 10 days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder.
Such list shall be open to the examination of any stockholder, for any purpose
germane to the meeting, during ordinary business hours, for a period of at least
10 days prior to the meeting, either at a place within the city where the
meeting is to be held, which place shall be specified in the notice of the
meeting, or if not so specified, at the place where the meeting is to be held.
The list shall also be produced and kept at the time and place of the meeting
during the whole time thereof and may be inspected by any stockholder who is
present. Upon the willful neglect or refusal of the directors to produce such a
list at any meeting for the election of directors, they shall be ineligible for
election to any office at such meeting.

     SECTION 1.13 Inspectors of Election.  By action of its board of directors
the Company shall, in advance of any meeting of stockholders, appoint one or
more inspectors of election, who may be employees of the Company, to act at the
meeting or any adjournment thereof and to make a written report thereof. In the
same manner, the Company may designate one or more persons as alternate
inspectors to replace any inspector who fails to act. In the event that no
inspector so appointed or designated is able to act at a meeting of
stockholders, the chairman of the meeting shall appoint one or more inspectors
to act at the meeting. Each inspector, before entering upon the discharge of his
or her duties, shall take and sign an oath to execute faithfully the duties of
inspector with strict impartiality and according to the best of his or her
ability. The inspector or inspectors so appointed or designated shall: (i)
ascertain the number of shares of capital stock of the Company outstanding at
the record date for the meeting and the voting power of each such share; (ii)
determine the shares of capital stock of the Company represented at the meeting
and the validity of proxies and ballots; (iii) count all votes and ballots; (iv)
determine and retain for a reasonable period a record of the disposition of any
challenges made to any determination by the inspectors; and (v) certify their
determination of the number of shares of capital stock of the Company
represented at the meeting and such inspectors' count of all votes and ballots.
Such certification and report shall specify such other information as

                                        4
<PAGE>

may be required by law or specified by the chairman of the meeting. In
determining the validity and counting of proxies and ballots cast at any meeting
of stockholders of the Company, the inspectors may consider such information as
is permitted by applicable law. No person who is a candidate for an office at an
election may serve as an inspector at such election.

     SECTION 1.14 Stockholders of Record.  Except as otherwise provided by law,
the stock ledger of the Company provided for by Section 4.4 of these Bylaws
shall be the only evidence as to who are the stockholders of the Company
entitled, upon compliance with any applicable provisions of the Delaware General
Corporation Law: (i) to examine the stock ledger, any list of stockholders
(including the list of stockholders referred to in Section 1.12 of these Bylaws)
or the other books and records of the Company; and (ii) to vote in person or by
proxy at any meeting of stockholders. The Company shall be entitled to treat the
holder of record of any shares of stock of the Company as the holder in fact
thereof and, accordingly, shall not be bound to recognize any equitable or other
claim to or interest in such shares on the part of any other person, whether or
not it shall have express or other notice thereof, except as otherwise provided
by law. All references in the Delaware General Corporation Law, the Restated
Certificate of Incorporation or these Bylaws, unless the context or the law
otherwise requires, to "stockholders," "stockholders of record," "registered
owners" and similar terms shall refer in each case, at a given date, only to the
stockholders and the stock of the Company held by them as such information is
set forth on the stock ledger of the Company as of such date.

                                   ARTICLE II

                               BOARD OF DIRECTORS

     SECTION 2.1 Powers.  The business and affairs of the Company shall be
managed by or under the direction of the board of directors of the Company,
except as may be otherwise provided by law or the Restated Certificate of
Incorporation. In addition to the powers and authorities by these Bylaws
expressly conferred upon them, the board of directors may exercise all such
powers of the Company and do all such lawful acts and things as are not by
statute or by the Restated Certificate of Incorporation or by these Bylaws
required to be exercised or done by the stockholders.

     SECTION 2.2 Number, Classification, Election, Term of Office and
Qualifications.  The number of directors which shall constitute the whole board
shall be fixed from time to time by the board of directors of the Company
pursuant to a resolution adopted by the affirmative vote of not less than two
thirds of the directors of the Company then in office or by the stockholders of
the Company upon the affirmative vote of the holders of at least 80% of the
shares of the Company then entitled to be voted on such matter. The directors of
the Company shall be classified and elected and their terms of office shall be
as provide in Article Sixth of the Restated Certificate of Incorporation and in
Article I of these Bylaws. Directors need not be stockholders.

     SECTION 2.3 Resignation, Removal and Vacancies.  Any director may resign at
any time upon written notice to the Company. Unless the board of directors of
the Company determines otherwise, any director who is also an employee of the
Company or its affiliates shall be deemed to have retired as a director upon
such director's retirement as an employee or termination of employment. Removal
of directors shall be accomplished in the manner provided by Article Sixth of
the Restated Certificate of Incorporation and required by law.

     SECTION 2.4 Newly Created Directorships.  Subject to applicable law and the
Restated Certificate of Incorporation, and unless the board of directors of the
Company otherwise determines, vacancies resulting from death, resignation,
retirement, disqualification, removal from office or other cause, and newly
created directorships resulting from any increase in the authorized number of
directors, may be filled only by the affirmative vote of a majority of the
remaining directors, though less than a quorum of the board of directors, or by
a sole remaining director, and directors so chosen shall hold office for a term
expiring at the annual meeting of stockholders at which the term of office of
the class to which they have been elected expires and until such director's
successor shall have been duly elected and qualified.

     SECTION 2.5 Annual Meeting.  The first meeting of the board of directors
following each annual meeting of stockholders shall be held immediately after,
and at the same place as, such annual meeting of
                                        5
<PAGE>

stockholders, and no notice of such meeting other than this Bylaw shall be
necessary to any director, including any director elected at such annual meeting
of stockholders, in order legally to constitute the meeting provided a quorum
shall be present. In the event of the failure to hold such meeting of the board
of directors at the time and place specified in the preceding sentence, the
meeting may be held at such time and place as shall be specified in a notice
given as hereinafter provided for special meetings of the board of directors, or
as shall be specified in a written waiver of notice signed by those directors
who did not attend such meeting.

     SECTION 2.6 Regular Meetings.  Regular meetings of the board of directors,
or of any committee thereof, may be held at such places within or without the
State of Delaware and at such times as the board of directors or such committee
may from time to time determine, and if so determined notices thereof need not
be given.

     SECTION 2.7 Special Meetings.  (a) Special meetings of the board of
directors may be held at any time or place within or without the State of
Delaware whenever called by the chairman of the board, the president or any two
members of the board of directors. Notice of a special meeting of the board of
directors shall be given by the person or persons calling the meeting, in the
manner specified in Section 2.13 of these Bylaws, at least 24 hours before the
special meeting.

     (b) Special meetings of any committee of the board of directors may be held
at any time or place within or without the State of Delaware whenever called by
the chairman of the board, the president or the chairman of the committee.
Notice of a special meeting of any committee of the board of directors shall be
given by the person calling the meeting, in the manner specified in Section 2.13
of these Bylaws, at least 24 hours before the special meeting.

     SECTION 2.8 Telephonic Meetings Permitted.  Members of the board of
directors, or of any committee thereof, may participate in a meeting thereof by
means of conference telephone or similar communications equipment by means of
which all persons participating in the meeting can hear each other, and
participation in a meeting pursuant to this Section 2.8 shall constitute
presence in person at such meeting.

     SECTION 2.9 Quorum; Vote Required for Action.  At all meetings of the board
of directors a majority of the whole board of directors shall constitute a
quorum for the transaction of business. Except in cases in which the Restated
Certificate of Incorporation, these Bylaws or applicable law otherwise provides,
the vote of a majority of the directors present at a meeting at which a quorum
is present shall be the act of the board of directors. If a quorum shall not be
present at any meeting of the board of directors, the directors present thereat
may adjourn the meeting from time to time, without notice other than
announcement at a meeting until a quorum shall be present.

     SECTION 2.10 Organization of Meetings.  Meetings of the board of directors
shall be presided over by the chairman of the board, or in his or her absence by
the vice chairman of the board, if any, or in his or her absence by the
president (if he or she is also a director) or in their absence by a chairman
chosen at the meeting. The secretary of the Company shall act as secretary of
the meeting, but in his or her absence the chairman of the meeting may appoint
any person to act as secretary of the meeting.

     SECTION 2.11 Action by Written Consent.  Unless otherwise restricted by the
Restated Certificate of Incorporation or these Bylaws, any action required or
permitted to be taken at any meeting of the board of directors, or of any
committee thereof, may be taken without a meeting if all members of the board of
directors or such committee, as the case may be, consent thereto in writing, and
the writing or writings are filed with the minutes of proceedings of the board
of directors or such committee.

     SECTION 2.12 Committees of the Board.  (a) The board of directors, by a
resolution passed by a majority of the whole board of directors, shall appoint
from among its members an executive committee, such members to serve at the
pleasure of the board. The number of directors to be appointed as members of the
executive committee shall be fixed from time to time by resolution of the board
but shall not be less than three. The board of directors shall designate one of
the members of the executive committee as chairman of the executive committee.
To the maximum extent permitted by law, the executive committee shall have and
may exercise, when the whole board of directors is not in session, all the
powers of the board of directors in the management and affairs of the Company,
except that the executive committee shall not have the power to

                                        6
<PAGE>

designate, or revoke the designation of, a chief executive officer pursuant to
Section 3.5 of these bylaws, or terminate the employment of the chief executive
officer. The executive committee may authorize the seal of the Company to be
affixed to all papers which may require it.

     (b) The board of directors shall have such other committees, if any, as the
board of directors may, by resolution passed by a majority of the whole board of
directors, designate, each such committee to consist of one or more of the
directors of the Company as determined by the board of directors. The board of
directors shall appoint the member or members of each such committee, who shall
serve at the pleasure of the board, and shall designate one member of the
committee to be its chairman. Each such committee, to the extent permitted by
law and provided in the resolution of the board of directors designating it,
shall have and may exercise all the powers and authority of the board of
directors in the management of the business and affairs of the Company. Each
such committee may authorize the seal of the Company to be affixed to all papers
which may require it.

     (c) The board of directors may designate one or more directors as alternate
members of any committee of the board of directors, who may replace any absent
or disqualified member at any meeting of the committee. In addition, in the
absence or disqualification of a member of any committee of the board of
directors, the member or members thereof present at any meeting and not
disqualified from voting, whether or not such member or members constitute a
quorum, may unanimously appoint another member of the board of directors to act
at the meeting in place of any such absent or disqualified member.

     (d) Unless the board of directors otherwise provides, the executive
committee and each other committee, if any, designated by the board of directors
may make, alter and repeal rules for the conduct of its business. In the absence
of such rules each committee shall conduct its business in the same manner as
the board of directors conducts its business pursuant to this Article II. Each
of the committees shall keep minutes of all of its meetings which shall be open
to the inspection of any director at any time.

     SECTION 2.13 Notices to Directors.  (a) All notices to directors shall be
in writing and shall be delivered by hand or sent by facsimile transmission
("fax") or mail to the directors at their respective addresses or fax numbers
most recently furnished by each of them in writing to the secretary of the
Company. Any notice delivered by hand to such address of a director shall be
deemed to have been given on the day it is so delivered at such address,
provided that if such day is not a business day then the notice shall be deemed
to have been given on the business day next following such day. Any notice sent
by fax to such fax number of a director shall be deemed to have been given on
the date and time the fax is sent if transmitted during normal business hours on
a business day or otherwise shall be deemed to have been given at the normal
opening of business on the business day next following the date of its
transmission. Any notice sent by mail to such address of a director shall be
deemed to have been given when the notice is deposited in the United States
mail, postage prepaid. For purposes of this Bylaw, the term "business day" means
any day other than a Saturday, Sunday or official national holiday in the United
States.

     (b) Notice to any member or alternate member of any committee of the board
of directors, in his or her capacity as a committee member, may be given in the
same manner as that specified in paragraph (a) for notices to directors as such;
notice to any committee member may also be given orally, in person or by
telephone, and in any such case shall be deemed to be given when actually
received by the committee member.

     SECTION 2.14 Waiver of Notice.  Whenever any notice is required to be given
to a director under the provisions of any statute, the Restated Certificate of
Incorporation or these Bylaws, a waiver thereof in writing signed by the
director entitled to said notice, whether before or after the time stated
therein, shall be deemed equivalent to notice. Attendance of a director at a
meeting of the board of directors or any committee thereof shall constitute a
waiver of notice of such meeting, except when the director attends a meeting for
the express purpose of objecting, at the beginning of the meeting, to the
transaction of any business because the meeting is not lawfully called or
convened.

     SECTION 2.15 Compensation of Directors.  Each director of the Company shall
be entitled to receive such compensation on such bases for his or her services
as a director and as a member of any standing or

                                        7
<PAGE>

special committee of the board of directors as the board of directors by
resolution may from time to time determine. In addition, each director, whether
or not an employee of the Company, shall be entitled to reimbursement for all
expenses reasonably incurred by him or her in connection with attending any
meeting of the board of directors or of any committee thereof.

                                  ARTICLE III

                                    OFFICERS

     SECTION 3.1 Officers.  The officers of the Company shall be a chairman of
the board, a president, one or more vice presidents (the number and designation
thereof to be determined by the board of directors), a treasurer and a
secretary. The board of directors shall designate either the chairman of the
board or the president as the chief executive officer of the Company, and it may
designate the same or one or more other officers as the chief operating officer
and the chief financial officer of the Company. The officers of the Company
shall be elected by the board of directors; provided, however, that in its
discretion, the board of directors may leave any such office unfilled. The board
of directors may also from time-to-time elect such other officers of the
Company, including without limitation one or more vice chairmen of the board,
assistant treasurers and assistant secretaries, as it shall deem advisable. Any
two or more offices may be held by the same person. No officer other than the
chairman of the board and any vice chairman of the board need be a director of
the Company.

     SECTION 3.2 Term of Office; Resignation; Removal; Vacancies.  Each officer
of the Company shall hold office until the first meeting of the board of
directors after the annual meeting of stockholders of the Company next
succeeding his or her election, and until his or her successor is elected, or
until his or her earlier death, resignation or removal. Any officer may resign
at any time upon written notice to the Company, but such resignation shall be
without prejudice to the contractual rights of the Company, if any, with such
officer. The board of directors may remove any officer with or without cause at
any time, but such removal shall be without prejudice to the contractual rights
of such officer, if any, with the Company. Any vacancy occurring in any office
of the Company by death, resignation, removal or otherwise may be filled for the
unexpired portion of the term by the board of directors at any regular or
special meeting thereof.

     SECTION 3.3 Compensation of Officers.  The salaries and other compensation
(including, without limitation, bonuses and similar supplemental payments) of
the officers of the Company shall be fixed or approved from time to time by or
under the direction of the board of directors.

     SECTION 3.4 Powers and Duties of Officers.  Each of the officers of the
Company shall have such powers and perform such duties in the management of the
Company as are prescribed or assigned in these Bylaws or as may be prescribed or
assigned from time to time by the board of directors or by the officer of the
Company to whom he or she reports and, to the extent not so prescribed or
assigned, as generally pertain to his or her office, subject to the control of
the board of directors. The board of directors may require any officer, agent or
employee to give security for the faithful performance of his or her duties in
such form and amount as the board of directors shall determine. Nothing in any
other provision of this Article III is intended to limit the generality of this
Section 3.4.

     SECTION 3.5 Chief Executive Officer.  The chief executive officer of the
Company, who shall be designated by the board of directors and who shall be
either the chairman of the board or the president of the Company, shall have
general and active authority, control and supervision over the business,
property and affairs of the Company, subject to the board of directors. The
chief executive officer shall report to the board of directors. He or she shall
keep the board of directors fully informed, and shall freely consult it,
concerning the business and affairs of the Company, and he or she shall see that
all orders and resolutions of the board of directors are carried out.

     SECTION 3.6 Chairman of the Board.  The chairman of the board shall preside
at the meetings of the board of directors and of the stockholders. As a
spokesman of the board of directors, the chairman of the board shall consult
from time to time with the officers concerning the Company's policies and
business, as may be requested by the board of directors or by the officers, or
on his own initiative. The chairman of the board shall

                                        8
<PAGE>

engage or participate in a senior capacity in other matters of concern to the
board of directors, as may be requested by the board of directors. If the
chairman of the board has been designated as the Company's chief executive
officer by the board of directors, then he or she shall also have those powers
and duties conferred by Section 3.5 of these Bylaws upon the chief executive
officer.

     SECTION 3.7 Vice Chairman of the Board.  In the absence of the chairman of
the board, the vice chairman of the board, if any, shall preside at the meetings
of the board of directors and of the stockholders, and shall perform the duties
of the chairman of the board and, when so acting, shall have all the powers of
and be subject to all the restrictions upon the chairman of the board.

     SECTION 3.8 President.  If there is no chairman of the board or vice
chairman of the board in office or in the absence of the chairman of the board
and the vice chairman of the board or in the event of their disability, the
president shall also have all of the authority attaching to the office of
chairman of the board as described in the preceding section. The president shall
perform such other duties and shall have such other powers as may be assigned to
him by the board of directors or by the chairman of the board or vice chairman
of the board, if any. If the president has been designated as the Company's
chief executive officer by the board of directors, then he or she shall also
have those powers and duties conferred by Section 3.5 of these Bylaws upon the
chief executive officer.

     SECTION 3.9 Vice Presidents.  In the absence of the chairman of the board,
the vice chairman of the board and the president or in the event of their
disability, the vice president (or in the event there be more than one vice
president, the vice presidents in the order designated, or in the absence of a
designation in the order of their election) shall perform the duties of the
chairman of the board, vice chairman of the board and president, and when so
acting, shall have all the powers of and be subject to all the restrictions upon
the chairman of the board, the vice chairman of the board and president. The
vice presidents shall perform such other duties and have such other powers as
the board of directors or the chairman of the board, vice chairman of the board
or president may from time to time prescribe.

     SECTION 3.10 Secretary.  The secretary shall attend all meetings of the
board of directors and all meetings of the stockholders, and record all of the
proceedings of the meetings of the stockholders and of the board of directors in
a book to be kept for that purpose, and shall perform like duties for the
standing committees when required. He or she shall give, or cause to be given,
notice of all meetings of the stockholders and special meetings of the board of
directors, and shall perform such other duties as may be prescribed by the board
of directors or the chairman of the board or president, under whose supervision
he or she shall be. He or she shall have custody of the corporate seal of the
Company and he or she, or an assistant secretary, shall have authority to affix
it to any instrument requiring it, and when so affixed, it may be attested by
his or her signature or by the signature of such assistant secretary. The board
of directors may give general authority to any other officer to affix the seal
of the Company and to attest the affixing by his or her signature.

     SECTION 3.11 Assistant Secretaries.  The assistant secretary, or if there
be more than one, the assistant secretaries in the order determined by the board
of directors (or if there be no such determination, then in the order of their
election or appointment) shall, in the absence of the secretary or in the event
of his or her disability, perform the duties and exercise the powers of the
secretary, and shall perform such other duties and have such other powers as the
board of directors or the chairman of the board or president may from time to
time prescribe.

     SECTION 3.12 Treasurer.  The treasurer shall keep adequate accounts of the
receipts, disbursements and other transactions, and of the assets and
liabilities, of the Company, shall deposit with the Company's custodian funds,
securities and other investments of the Company, and shall direct the custodian
to make appropriate disbursements of funds and deliveries of securities and
other investments of the Company. The treasurer shall render to the chief
executive officer and to the board of directors, at its regular meetings, or
when the board of directors so requires, financial statements of the Company and
accountings of his or her transactions as treasurer. He or she shall perform
such other duties and have such other powers as the board of directors or the
chairman of the board or president may from time to time prescribe.

                                        9
<PAGE>

     SECTION 3.13 Assistant Treasurers.  The assistant treasurer, or if there
shall be more than one, the assistant treasurers in the order determined by the
board of directors (or if there be no such determination, then in the order of
their election or appointment), shall, in the absence of the treasurer or in the
event of his or her disability, perform the duties and exercise the powers of
the treasurer and shall perform such other duties and have such other powers as
the board of directors or the chairman of the board or president may from time
to time prescribe.

                                   ARTICLE IV

                                     STOCK

     SECTION 4.1 Certificates.  (a) Every holder of stock of the Company shall
be entitled to have a certificate signed by, or in the name of the Company by,
the chairman of the board, a vice chairman of the board or the president or vice
president and the secretary or an assistant secretary or treasurer or an
assistant treasurer of the Company, certifying the number of shares owned by the
holder in the Company. Any or all of the signatures on the certificate may be a
facsimile. In case any officer, transfer agent or registrar who has signed or
whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificate is
issued, the certificate may nevertheless be issued by the Company with the same
effect as if he, she or it was such officer, transfer agent or registrar at the
date of issue.

     (b) If the Company shall be authorized to issue more than one class of
stock or more than one series of any class, the powers, designations,
preferences and relative, participating, optional, or other special rights of
each class of stock or series thereof and the qualifications, limitations, or
restrictions of such preferences and/or rights shall be set forth in full or
summarized on the face or back of the certificate which the Company shall issue
to represent such class or series of stock, provided that, except as otherwise
provided in Section 202 of the General Corporation Law of Delaware, in lieu of
the foregoing requirements, there may be set forth on the face or back of the
certificate a statement that the Company will furnish, without charge to each
stockholder who so requests, the powers, designations, preferences and relative,
participating, optional, or other special rights of each class of stock or
series thereof and the qualifications, limitations, or restrictions of such
preferences and/or rights.

     SECTION 4.2 Lost, Stolen or Destroyed Certificates; Issuance of New
Certificates.  The Company, when authorized to do so by the board of directors,
which authorization may be general or confined to specific instances, may issue
a new certificate of stock in place of any certificate representing shares
theretofore issued by the Company and alleged to have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person claiming
the certificate for such shares to be lost, stolen or destroyed. When
authorizing such issuance of a new certificate or certificates, the Company may,
in its discretion and as a condition precedent to the issuance thereof, require
the owner of such lost, stolen or destroyed certificate or certificates, or the
legal representative of the owner, to give the Company a bond in such sum as it
may direct as indemnity against any claim that may be made against the Company
in connection with the certificate alleged to have been lost, stolen, or
destroyed.

     SECTION 4.3 Registration of Transfers.  Upon surrender to the Company or
the transfer agent of the Company of a certificate representing shares duly
endorsed or accompanied by proper evidence of succession, assignation or
authority to transfer, the Company or its transfer agent shall cancel the old
certificate, record the transaction upon the stock records of the Company and
issue a new certificate or certificates to the person or persons entitled
thereto.

     SECTION 4.4 The Stock Ledger.  The name and address of each holder of
shares of stock of the Company and the number of shares of each class or series
so held by such holder shall be recorded on the Company's stock ledger Each such
holder shall be the holder of record of such shares of the Company for all
purposes.

                                        10
<PAGE>

                                   ARTICLE V

                  INDEMNIFICATION AND ADVANCEMENT OF EXPENSES

     SECTION 5.1 Right to Indemnification.  (a) Subject to paragraph (b) of this
Section 5.1, each person (hereinafter in this Article V, a "Covered Person") who
was or is made a party to or is threatened to be made a party to or is otherwise
subpoenaed in connection with any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative
(hereinafter in this Article V, a "proceeding"), by reason of the fact that he
or she or a person of whom he or she is the legal representative is or was a
director or officer of the Company or is or was serving at the request of the
Company as a director, officer, employee, trustee or agent of any other
corporation or of any partnership, joint venture, limited liability company,
trust or other enterprise including without limitation service with respect to
any employee benefit plan or trust or any charitable foundation (hereinafter in
this Article V, "another entity"), shall be indemnified and held harmless by the
Company to the fullest extent authorized by the Delaware General Corporation Law
as the same exists or may hereafter be amended, against all expenses, judgments,
fines and amounts paid in settlement (including, without limitation, attorneys'
fees and disbursements, ERISA excise taxes, penalties or interest related to any
such obligations actually and reasonably incurred by the Covered Person in
connection therewith), and such indemnification shall continue as to a Covered
Person who has ceased to be a director or officer of the Company and shall inure
to the benefit of his or her heirs, executors and administrators; provided,
however, that the Company shall indemnify any such Covered Person seeking
indemnification in connection with a proceeding (or part thereof) brought by or
on behalf of such Covered Person only if such proceeding (or part thereof) was
authorized by a majority of the entire board of directors of the Company.

     (b) Any indemnification pursuant to either Article Seventh of the Restated
Certificate of Incorporation or paragraph (a) of this Section 5.1 (unless
ordered by a court) shall be made by the Company only as authorized in the
specific case upon a determination that indemnification of the Covered Person is
proper in the circumstances because he or she (or the person of whom he or she
is the legal representative) has met the applicable standards of conduct for
indemnification under subsection (a) or subsection (b) of Section 145 of the
Delaware General Corporation Law as the same exists or may hereafter be amended.
Such determination shall be made (1) by a majority vote of a quorum of those
directors of the Company who are not parties to the proceeding, or (2) if there
is no quorum of such directors of the Company, or if such directors so direct,
by independent legal counsel in a written opinion, such counsel to be selected
by the board of directors and paid by the Company.

     SECTION 5.2 Advancement of Expenses.  (a) Subject to paragraph (b) of this
Section 5.2, the expenses (including attorneys' fees and disbursements) incurred
by a Covered Person in defending or responding to any proceeding to which such
person is a party or is threatened to be made a party or is otherwise subpoenaed
in connection with, by reason of the fact that such Covered Person (or the
person of whom he or she is the legal representative) is or was an officer or a
director of the Company or is or was serving at the request of the Company as a
director, officer, employee, trustee or agent of another entity, shall be paid
by the Company, as those expenses become due, in advance of the final
disposition of such proceeding, upon receipt by the Company of an undertaking by
such Covered Person, in form and substance satisfactory to the Company, to repay
such amounts so advanced if it shall ultimately be determined that he or she is
not entitled to be indemnified by the Company for such expenses under Article
Seventh of the Restated Certificate of Incorporation, Article V of these Bylaws
or otherwise; provided, however, that the Company shall pay the expenses of any
such Covered Person in advance, as provided in this Section 5.2, which are
incurred in connection with a proceeding (or part thereof) brought by or on
behalf of such person only if such proceeding (or part thereof) was authorized
by a majority of the entire board of directors of the Company.

     (b) Any advancement of the expenses incurred by a Covered Person in
defending or responding to any proceeding, whether made pursuant to paragraph
(a) of this Section 5.2 or otherwise, shall be made by the Company only as
authorized in the specific case upon a determination that advancement of such
expenses to the Covered Person is proper in the circumstances because (1) such
Covered Person has provided security for his or her repayment undertaking given
pursuant to paragraph (a), or (2) the Company is insured against

                                        11
<PAGE>

losses arising by reason of any lawful advances or (3) based on a review of
readily available facts (as opposed to a full trial-type inquiry), there is
reason to believe that such Covered Person ultimately will be found entitled to
indemnification pursuant to Article Seventh of the Restated Certificate of
Incorporation and Section 5.1 of these Bylaws. Such determination shall be made
only in the manner specified in the penultimate sentence of paragraph (b) of
Section 5.1 of these Bylaws.

     SECTION 5.3 Claims.  If a claim for indemnification or advancement of
expenses under Article Seventh of the Restated Certificate of Incorporation or
this Article V is not paid in full by or on behalf of the Company within 30 days
after a written claim therefor by the Covered Person has been received by the
Company, the Covered Person may file suit to recover the unpaid amount of such
claim and, if successful in whole or in part, shall be entitled to be paid by
the Company an additional amount equal to the expense of prosecuting such claim.
In any such action the Company shall have the burden of proving that the Covered
Person was not entitled to the requested indemnification or payment of expenses
under applicable law. Neither the failure of the Company (including its board or
independent legal counsel) to have made a determination prior to the
commencement of such action that such indemnification or reimbursement or
advancement of expenses is proper in the circumstances nor an actual
determination by the Company (including its board, its independent legal counsel
and its stockholders) that such Covered Person is not entitled to such
indemnification or reimbursement or advancement of expenses shall constitute a
defense to the action or create a presumption that such Covered Person is not so
entitled.

     SECTION 5.4 Nonexclusivity of Rights; Purchase of Insurance.  (a) The
rights conferred on any Covered Person by this Article V shall not be exclusive
of any other rights which such person may have or hereafter acquire under any
statute, the Restated Certificate of Incorporation, these Bylaws, any agreement,
any vote of stockholders or disinterested directors or otherwise. Any amendment
or repeal of any provision of this Article V shall not limit the right of any
person to indemnity or advancement of expenses with respect to actions taken or
omitted to be taken by such person prior to such amendment or repeal.

     (b) The Company shall have power to purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or agent of the
Company, or is or was serving at the request of the Company as a director,
officer, employee or agent of another entity, against any liability asserted
against such person and incurred by such person in any such capacity, or arising
out of such person's status as such, whether or not the Company would have the
power to indemnify such person against such liability under the provisions of
Section 145 of the General Corporation Law of Delaware; provided, however, that
no such insurance purchased or paid for by the Company shall provide any
insurance coverage to any director or officer of the Company for any liability
to the Company or its stockholders to which he or she would otherwise be subject
by reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of his or her office.

     SECTION 5.5 Provisions Deemed a Contract.  The provisions of Article
Seventh of the Restated Certificate of Incorporation and this Article V shall
constitute a contract between the Company, on the one hand, and each director
and officer of the Company who serves in such capacity at any time while either
of Article Seventh of the Restated Certificate of Incorporation and this Article
V is in effect and any other person entitled to indemnification hereunder, on
the other hand, pursuant to which the Company and each such Covered Person
intend to be, and shall be, legally bound. No repeal or modification of any
provision of Article Seventh of the Restated Certificate of Incorporation or
this Article V shall affect any rights or obligations with respect to any state
of facts then or theretofore existing or any proceeding theretofore or
thereafter brought or threatened based in whole or in part upon any such state
of facts.

     SECTION 5.6 Conclusive Presumption.  For purposes of this Article V, any
director or officer of the Company serving in any capacity (a) another
corporation of which a majority of the shares entitled to vote in the election
of its directors is held, directly or indirectly, by the Company or (b) any
employee benefit plan or trust of the Company or any corporation referred to in
clause (a), shall in either case be conclusively presumed to be doing so at the
request of the Company.

     SECTION 5.7 Other Indemnification.  The Company's obligation, if any, to
indemnify or to advance expenses to any Covered Person who was or is serving at
its request as a director, officer, employee, trustee or

                                        12
<PAGE>

agent of another entity shall be reduced by any amount such person may collect
as indemnification or advancement of expenses from such other entity.

                                   ARTICLE VI

                            MISCELLANEOUS PROVISIONS

     SECTION 6.1 Offices and Books and Records.  (a) The registered office of
the Company in the State of Delaware shall be in the City of Wilmington, County
of New Castle.

     (b) The Company may have offices at such other places, both within and
outside the State of Delaware, as the board of directors may from time to time
designate or as the business of the Company may require.

     (c) The books and records of the Company may be kept at the Company's
headquarters at Chicago, Illinois and at such other locations outside the State
of Delaware as may be from time to time designated by the board of directors.

     SECTION 6.2 Fiscal Year.  The fiscal year of the Company shall begin on the
first day of January in each year.

     SECTION 6.3 Seal.  The corporate seal shall have inscribed thereon the name
of the Company, the year of its organization and the words "Corporate Seal,
Delaware." The seal may be used by causing it or a facsimile thereof to be
impressed or affixed or reproduced or otherwise.

     SECTION 6.4 Form of Records.  Any records maintained by the Company in the
regular course of its business, including its stock ledger, books of account,
and minute books, may be kept on, or be in the form of, punch cards, magnetic
tape, computer entry, photographs, microphotographs, or any other information
storage device, provided that the records so kept can be converted into clearly
legible form within a reasonable time.

     SECTION 6.5 Signing of Checks, Notes, etc.  All checks, drafts, bills of
exchange, notes or other obligations or orders for the payment of money shall be
signed by such officer or officers or employee or employees of the Company and
in such manner as shall from time to time be determined by resolution of the
board of directors or by any officer of the Company authorized by resolution of
the board of directors to make such determinations.

     SECTION 6.6 Voting of Shares in Other Companies.  Unless otherwise
expressly ordered by the board of directors, any one of the chairman of the
board, the president or any vice president of the Company shall have full power
and authority, on behalf of the Company, to consent to or approve of any action
by, and to attend, act and vote at any meeting of stockholders or similar equity
owners of, any company in which the Company may hold shares of stock or similar
equity interests and in giving such consent or approval or at any such meeting
shall possess and may exercise any and all rights and powers incident to the
ownership of such shares or similar equity interests and which, as the holder
thereof, the Company might possess and exercise if personally present, and may
exercise such power and authority through the execution of proxies or may
delegate such power and authority to any other officer, agent or employee of the
Company. Provided that the transfer thereof has been authorized by the board of
directors or the chief executive officer, certificates or similar instruments
representing shares or similar equity interests owned by the Company in other
companies may be endorsed for transfer on behalf of the Company by any one of
the officers of the Company referred to in the preceding sentence.

     SECTION 6.7 Amendment of Bylaws.  These Bylaws may be altered, amended or
repealed, or new Bylaws may be adopted, by the board of directors. Any Bylaws
adopted by the board of directors may be altered, amended or repealed by the
stockholders, and the stockholders may make additional Bylaws, at any annual
meeting or at any special meeting, provided that notice of such proposed
alteration, amendment or repeal or new Bylaw shall have been given in the notice
of the meeting. No such altered or amended or new Bylaw shall be inconsistent
with any provision of the Restated Certificate of Incorporation.

                                        13

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>4
<FILENAME>y54925ex10-2.txt
<DESCRIPTION>SIXTH AMENDMENT TO LEASE
<TEXT>
<PAGE>

                                                                    EXHIBIT 10.2

                            SIXTH AMENDMENT TO LEASE

     This SIXTH AMENDMENT TO LEASE dated as of September 28, 2001 (this
"Amendment") between RCPI LANDMARK PROPERTIES, L.L.C., a Delaware limited
liability company, having an office c/o Tishman Speyer Properties, L.P., 45
Rockefeller Plaza, New York, New York 10111 ("Landlord"), and LEVIN MANAGEMENT
CO., INC., a Delaware corporation, having an office at One Rockefeller Plaza,
New York, New York 10020 ("Tenant").

                              W I T N E S S E T H:

     WHEREAS, Landlord's predecessor-in-interest, Rockefeller Center Properties,
and Tenant's predecessor-in-interest, John A. Levin & Co., Inc., entered into
that certain Lease dated December 20, 1993, as amended by Supplemental
Indenture, dated March 2, 1995 (the "Supplemental Indenture"), the First
Amendment to Lease, dated June 23, 1997 (the "First Amendment"), the Second
Amendment to Lease, dated as of January 22, 1998 (the "Second Amendment"), the
Third Amendment to Lease dated as of December 31, 1998 ("the "Third Amendment"),
the Fourth Amendment of Lease, dated July 18, 2000 (the "Fourth Amendment"), and
the Fifth Amendment to Lease, dated as of May 14th, 2001 (the "Fifth
Amendment"), in respect of Space 'D' on the 3rd floor (the "3rd Floor
Premises"), Space 'A' on the 19th floor (the "19th Floor Premises"), Space 'A'
on the 25th floor (the "25th Floor Premises"), the entire 4th Floor designated
as Space 'A' (the "4th Floor Premises") and Space 'P' on the 22nd floor (the
"Storage Space" and, together with the 3rd Floor Premises, the 19th Floor
Premises, 25th Floor Premises and the 4th Floor Premises, collectively, the
"Premises") of the building known as One Rockefeller Plaza, New York, New York
(the "Building") (the above-mentioned lease, as heretofore amended by the
Supplemental Indenture, the First Amendment, the Second Amendment, the Third
Amendment, the Fourth Amendment and the Fifth Amendment, is hereinafter called
the "Original Lease").

     WHEREAS, Landlord and Tenant desire to modify the Original Lease to (i)
provide for the leasing by Tenant of the entire eighteenth floor of the
Building, designated as Space 'A', and being more particularly shown on Exhibit
A attached hereto (the "18th Floor Premises") and (ii) otherwise modify the
terms and conditions of the Original Lease, all as hereinafter set forth (the
Original Lease, as modified by this Amendment, the "Lease").

     NOW, THEREFORE, in consideration of the mutual covenants herein contained,
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Landlord and Tenant agree as follows:

          1. Capitalized Terms.  All capitalized terms used and not otherwise
     defined in this Amendment shall have the respective meanings ascribed to
     them in the Original Lease.

          2.  Lease of 18th Floor Premises.  (a) Landlord hereby leases to
     Tenant, and Tenant hereby leases from Landlord, subject and subordinate to
     the Qualified Encumbrances, the 18th Floor Premises for a term commencing
     on the later to occur of (i) November 1, 2001 and (ii) the date that
     Landlord delivers possession of the 18th Floor Premises to Tenant (the
     "18th Floor Premises Commencement Date") and ending on the 2001 Extended
     Expiration Date (as defined in the Fifth Amendment), or such earlier date
     upon which the term of the Lease may expire or be terminated pursuant to
     any of the conditions of limitation or other provisions of the Lease or
     pursuant to law, upon all of the terms and conditions of the Original
     Lease, as modified by this Amendment.

          (b) Landlord shall not be liable for failure to deliver possession of
     the 18th Floor Premises to Tenant on any specified date, and such failure
     shall not impair the validity of this Amendment. Landlord shall be deemed
     to have delivered possession of the 18th Floor Premises to Tenant upon the
     giving of notice by Landlord to Tenant stating that the entire 18th Floor
     Premises are vacant, broom-clean, free of all tenancies and occupants and
     available for Tenant's occupancy (subject to such notice being factually
<PAGE>

     correct). There shall be no postponement of the 18th Floor Premises
     Commencement Date for any delay in the delivery of possession of the 18th
     Floor Premises to Tenant that results from any Tenant Delay. The provisions
     of this Section 2(b) are intended to constitute "an express provision to
     the contrary" within the meaning of Section 223-a of the New York Real
     Property Law or any successor Requirement.

          (c) Effective as of the 18th Floor Premises Commencement Date, Tenant
     shall lease the 18th Floor Premises upon all of the terms and conditions of
     the Original Lease, except as follows:

             (i) The fixed rent payable under the Lease with respect to the 18th
        Floor Premises shall be an amount equal to (A) $1,137,562.00 per annum
        ($94,796.83 per month) for the period commencing on the 18th Floor
        Premises Commencement Date (the "18th Floor Premises Rent Commencement
        Date") and ending on October 31, 2006,both dates inclusive; and (B)
        $1,217,672.00 per annum ($101,472.67 per month) for the period
        commencing on November 1, 2006 and ending on the 18th Floor Expiration
        Date, both dates inclusive.

             (ii) The 18th Floor Premises shall be deemed to consist of 16,022
        rentable square feet for all purposes of the Lease.

             (iii) Tenant shall pay all additional rent payable pursuant to the
        Original Lease including Article Twenty-Four thereof, except with
        respect to the 18th Floor Premises only, (A) the clause "110% of" in
        Section 24.1 of the Original Lease shall be deemed to be deleted in both
        places in which it appears, (B) the clause "110% of" in Section 24.2(b)
        of the Original Lease shall be deemed to be deleted in both places in
        which it appears, (C) the term "Base Real Estate Taxes" shall mean the
        one-half of the sum of (1) the R.E. Tax Share of the Real Estate Taxes
        for the Tax Year beginning on July 1, 2000 and ending on June 30, 2001
        and (2) R.E. Tax Share of the Real Estate Taxes for the Tax Year
        beginning on July 1, 2001 and ending on June 30, 2002 (D) the term "Base
        COM" shall mean the O.E. Share of the Cost of Operation and Maintenance
        for the Computation Year beginning on January 1, 2001 and ending on
        December 31, 2001, and (E) the term "Tenant's Area" shall mean 16,022
        rentable square feet.

             (iv) Tenant has inspected the 18th Floor Premises and agrees (A) to
        accept possession of the 18th Floor Premises in the "as is" condition
        existing on the 18th Floor Premises Commencement Date, (B) that neither
        Landlord nor Landlord's agents have made any representations or
        warranties with respect to the 18th Floor Premises or the Building
        except as expressly set forth herein, and (C) Landlord has no obligation
        to perform any work, supply any materials, incur any expense or make any
        alterations or improvements to the 18th Floor Premises to prepare the
        18th Floor Premises for Tenant's occupancy. Tenant's occupancy of any
        part of the 18th Floor Premises shall be conclusive evidence, as against
        Tenant, that (1) Tenant has accepted possession of the 18th Floor
        Premises in its then current condition, and (2) the 18th Floor Premises
        and the Building are in a good and satisfactory condition as required by
        this Amendment.

             (v) Tenant shall install or modify, as the case may be and to the
        extent necessary, as part of its initial Alterations of the 18th Floor
        Premises and thereafter maintain in good order and repair, a sprinkler
        system and fire-alarm and life-safety system serving the 18th Floor
        Premises. Such installation or modification and maintenance shall be
        performed by Tenant in accordance with the Lease, the rules and
        regulations and all Requirements. If the Fire Insurance Rating
        Organization or any Governmental Authority (as hereinafter defined) or
        any of Landlord's insurers requires or recommends any modifications or
        Alterations be made or any additional equipment be supplied in
        connection with the sprinkler system or fire-alarm and life-safety
        system serving the Building or the 18th Floor Premises by reason of
        Tenant's business, or the location of the partitions, trade fixtures, or
        other contents of the 18th Floor Premises, Landlord (to the extent such
        modifications or Alterations are structural, affect any Building system
        or involve the performance of work outside the 18th Floor Premises), or
        Tenant (to the extent such modifications or Alterations are
        nonstructural, do not affect any Building system and do not involve the
        performance of work outside the 18th Floor Premises) shall make such
        modifications or Alterations, and supply such additional equipment, in
        either case at Tenant's expense.
                                        2
<PAGE>

             (vi) Except as provided in this Amendment, all references in the
        Original Lease to the "Premises" shall be deemed to include the 18th
        Floor Premises for all purposes of the Lease. With respect to the 18th
        Floor Premises only, all references in the Original Lease to "term" or
        "term of this Lease" or words of similar import shall be deemed to refer
        to the term of the leasing of the 18th Floor Premises (i.e., the portion
        of the term from and after the 18th Floor Premises Commencement Date).

             (vii) The provisions of Section 5.1 of the Original Lease shall not
        apply to the 18th Floor Premises but shall remain applicable to the
        Premises. The following shall apply to the 18th Floor Premises:

                (A) Landlord shall redistribute or furnish electricity to or for
           the use of Tenant in the 18th Floor Premises for the operation of
           Tenant's electrical systems and equipment in the 18th Floor Premises,
           at a level sufficient to accommodate a demand load of six watts per
           usable square foot of office space in the 18th Floor Premises. An
           estimated charge for such electricity of $48,066 ($3.00 per rentable
           square foot) (the "Electrical Inclusion Factor") is included in fixed
           rent in respect of the 18th Floor Premises on a so-called "rent
           inclusion" basis; however, the value to Tenant of such service may
           not be fully reflected in fixed rent in respect of the 18th Floor
           Premises. Accordingly, Tenant agrees that following the commencement
           of Tenant's ordinary business activities in the 18th Floor Premises,
           Landlord may cause an independent electrical engineer or electrical
           consulting firm selected by Landlord ("Landlord's Consultant") to
           make a determination, certified in writing to Landlord and Tenant, of
           the full value of the electrical service supplied to the 18th Floor
           Premises, based upon a survey indicating the lighting load, office
           equipment and all other electrical usage by Tenant in the 18th Floor
           Premises. Thereafter, Landlord may, at any time and from time to
           time, at its sole option, cause Landlord's Consultant to make
           subsequent determinations of the then full value of the electrical
           service supplied to the 18th Floor Premises on the basis set forth in
           the immediately preceding sentence. If Landlord's Consultant
           determines that the full value of the electrical service supplied to
           18th Floor Premises exceeds the Electrical Inclusion Factor, as
           increased from time to time in accordance with this Section
           2(c)(vii), then, upon notice to Tenant, fixed rent in respect of the
           18th Floor Premises and the Electrical Inclusion Factor shall be
           increased to reflect the full value, on an annual basis, of such
           increased electrical usage by Tenant in the 18th Floor Premises. Any
           increase in fixed rent in respect of the 18th Floor Premises and the
           Electrical Inclusion Factor shall be effective as of the date of the
           increase in Tenant's electrical usage at the 18th Floor Premises, as
           determined by the survey, and Tenant's liability therefor shall be
           retroactive to such date. The computation of the Electrical Inclusion
           Factor under this Section 2(c)(vii) is intended to constitute a
           formula for an agreed rental adjustment and may or may not constitute
           an actual reimbursement to Landlord for the electrical service
           supplied to Tenant pursuant to the Lease. If any tax is imposed on
           Landlord's receipts or income from the redistribution, furnishing, or
           sale of electricity to Tenant as provided for above (other than a
           general tax on corporate income not specific to the provision of
           electricity), whether based on the Electrical Inclusion Factor or any
           increase therein provided for above, or otherwise, Tenant shall
           reimburse Landlord for such tax, if and to the extent permitted by
           law. All electricity used during the performance of cleaning
           services, or the making of any Alterations or restorative work in the
           18th Floor Premises, or the operation of any supplemental or special
           air-conditioning systems serving the 18th Floor Premises, shall be
           paid for by Tenant.

                (B) Wherever in this Section 2(c)(vii) Landlord is given the
           right to cause Landlord's Consultant to make a determination of the
           full value of the annual electric services supplied to Tenant in the
           18th Floor Premises, Tenant shall have the right (i) to dispute such
           determination by notice delivered to Landlord within 20 days after
           notice to Tenant of such determination (time being of the essence as
           to such date), and (ii) to designate in such notice an independent
           electrical engineer or electrical consulting firm ("Tenant's
           Consultant") to make, at Tenant's sole cost and expense, a
           determination of the full value of the electrical service supplied to
           the

                                        3
<PAGE>

           18th Floor Premises, using the same method used by Landlord's
           Consultant as set forth in Section 2(c)(vii)(A) hereof. If Tenant's
           Consultant determines that Tenant's electrical usage at the 18th
           Floor Premises is less than that determined by Landlord's Consultant
           (or if Tenant's Consultant otherwise disputes the conclusions of
           Landlord's Consultant) and such consultants are unable to reach
           agreement within 10 days following notice to Landlord of the
           determination by Tenant's Consultant, then Landlord's Consultant and
           Tenant's Consultant shall jointly appoint a third electrical engineer
           or consulting firm to conduct a survey to determine Tenant's
           electrical usage in the 18th Floor Premises. The determination by
           such third electrical engineer or consulting firm shall be final and
           the costs of such determination shall be borne by the unsuccessful
           party (and if both parties are partially successful, the third
           electrical engineer shall apportion the costs between the parties
           based on the degree of success of each party). Pending such final
           determination, Tenant shall pay to Landlord the Electrical Inclusion
           Factor determined by Landlord's Consultant. Following a final
           determination pursuant to the terms hereof, Tenant shall pay to
           Landlord the amount of any underpayment by Tenant, or Landlord shall
           credit to Tenant the amount of any overpayment by Tenant. If Tenant
           shall fail to dispute the initial determination of Landlord's
           Consultant within the above-described 20-day period, then such
           determination shall be deemed to be final and binding on Landlord and
           Tenant.

                (C) If Landlord's cost of electricity increases or decreases
           after the 18th Floor Commencement Date for any reason whatsoever,
           then the Electrical Inclusion Factor shall be increased or decreased,
           as the case may be, in the same percentage for the remainder of the
           18th Floor Term. Landlord's Consultant shall determine the percentage
           for the changes in the Electrical Inclusion Factor resulting from any
           change in Landlord's cost of electricity. Landlord shall notify
           Tenant of any such changes and any such increase or decrease in fixed
           rent in respect of the 18th Floor Premises and the Electrical
           Inclusion Factor shall be effective as of the date of such increase
           or decrease in Landlord's cost of electricity, and Tenant's liability
           therefor shall be retroactive to such date. Notwithstanding anything
           set forth herein to the contrary, the Electrical Inclusion Factor
           shall in no event be decreased below the amount set forth in Section
           2(c)(vii)(A) hereof.

                (D) Landlord shall have the option at any time after the 18th
           Floor Commencement Date of installing submeters in the 18th Floor
           Premises, the expense of which shall be shared equally between
           Landlord and Tenant, to measure Tenant's electrical consumption. If
           Landlord exercises such option, fixed rent in respect of the 18th
           Floor Premises shall be reduced by an amount equal to the Electrical
           Inclusion Factor in effect as of commencement of the operation of
           such submeters, and Tenant shall pay to Landlord, from time to time,
           but no more frequently than monthly, for its consumption of
           electricity at the 18th Floor Premises, a sum equal to 109% of the
           product obtained by multiplying (i) the Cost Per Kilowatt Hour (as
           hereinafter defined), and (ii) the actual number of kilowatt hours of
           electric current consumed by Tenant at the 18th Floor Premises in
           such billing period. If any tax is imposed upon Landlord's receipts
           from the sale or resale of electricity to Tenant, Tenant shall pay
           such tax if and to the extent permitted by law as if Tenant were the
           ultimate consumer of such electricity. "Cost Per Kilowatt Hour" shall
           mean (a) the total cost for electricity incurred by Landlord to
           service the Building during a particular billing period (including
           energy charges, demand charges, surcharges, time-of-day charges, fuel
           adjustment charges, rate adjustment charges, taxes, rebates and any
           other factors used by the public utility company or other provider in
           computing its charges to Landlord) during such period, divided by (b)
           the total kilowatt hours purchased by Landlord to provide electricity
           to the Building during such period Where more than one meter measures
           the electricity to Tenant at the 18th Floor Premises, the electricity
           measured by each meter shall be computed and billed separately in
           accordance with the provisions set forth above. Bills for such
           amounts shall be rendered to Tenant at such times as Landlord may
           elect.

                                        4
<PAGE>

                (E) If Landlord shall discontinue the furnishing of electric
           current to the 18th Floor Premises pursuant to Section 5.2 of the
           Lease, then the fixed rent in respect of the 18th Floor Premises
           shall be reduced by an amount equal to the Electric Inclusion Factor.

             (vii) The following provisions of the Original Lease shall not be
        applicable to the leasing of the 18th Floor Premises: Section 20.2 and
        Articles Twenty-Seven, Thirty, Thirty-One and Thirty-Two.

          3.  Modifications.  Effective as of the 18th Floor Commencement Date
     Section 7.2.3 of the Original Lease is amended by inserting the following
     sentence at the end thereof:

             "The term "Applicable Rental Rate" as used in this Article with
        respect to the 18th Floor Premises only shall mean (x) $68.00 per annum
        for the period commencing on the 18th Floor Premises Commencement Date
        (as defined in the Sixth Amendment hereto) and ending on October 31,
        2006, both dates inclusive, and (y) $73.00 per annum for the period
        commencing on November 1, 2006 and ending on the 18th Floor Expiration
        Date (as defined in the Sixth Amendment hereto), both dates inclusive."

          4.  Brokerage.  Each of Landlord and Tenant represents and warrants to
     the other that it has not dealt with any broker in connection with this
     Amendment other than Tishman Speyer Properties, L.P. ("TSP") and Colliers
     ABR, Inc. (the "Broker") and that, to the best of its knowledge, no other
     broker negotiated this Amendment or is entitled to any fee or commission in
     connection herewith. Landlord shall pay TSP and Broker any commissions
     which they may be due in connection with this Amendment pursuant to
     separate agreements. Each of Landlord and Tenant shall indemnify, defend,
     protect and hold the other party harmless from and against any and all
     losses, liabilities, damages, claims, judgments, fines, suits, demands,
     costs, interest and expenses of any kind or nature (including reasonable
     attorneys' fees and disbursements) incurred in connection with any claim,
     proceeding or judgment and the defense thereof which the indemnified party
     may incur by reason of any claim of or liability to any broker, finder or
     like agent (other than TSP or Broker) arising out of any dealings claimed
     to have occurred between the indemnifying party and the claimant in
     connection with this Amendment, or the above representation being false.
     The provisions of this Section 4 shall survive the expiration or earlier
     termination of the term of the Lease.

          5.  Representations and Warranties.  Tenant represents and warrants to
     Landlord that, as of the date hereof, (a) the Original Lease is in full
     force and effect and has not been modified except pursuant to this
     Amendment; (b) to the best of Tenant's knowledge, there are no defaults
     existing under the Lease; (c) to the best of Tenant's knowledge, there
     exist no valid abatements, causes of action, counterclaims, disputes,
     defenses, offsets, credits, deductions, or claims against the enforcement
     of any of the terms and conditions of the Lease; (d) this Amendment has
     been duly authorized, executed and delivered by Tenant and constitutes the
     legal, valid and binding obligation of Tenant; (e) Landlord has paid all
     amounts and performed all work required to be paid or performed under the
     Lease in connection with Tenant's initial occupancy of the Premises under
     the Lease; and (f) to the best of Tenant's knowledge, Landlord is not in
     default of any of its obligations or covenants under the Lease.

          6.  Nondisturbance Agreement.  Landlord hereby agrees to use
     reasonable efforts to obtain for Tenant, at no cost to Landlord, a
     subordination, non-disturbance and attornment agreement (an "SNDA") from
     all existing Mortgagees, in the standard form customarily employed by such
     Mortgagees, provided that Landlord shall have no liability to Tenant, and
     the subordination of the Lease to any Mortgage shall not be affected, in
     the event that it is unable to obtain any such agreements.

          7.  Miscellaneous.  (a) Except as set forth herein, nothing contained
     in this Amendment shall be deemed to amend or modify in any respect the
     terms of the Original Lease and such terms shall remain in full force and
     effect as modified hereby. If there is any inconsistency between the terms
     of this Amendment and the terms of the Original Lease, the terms of this
     Amendment shall be controlling and prevail.

                                        5
<PAGE>

          (b) This Amendment contains the entire agreement of the parties with
     respect to its subject matter and all prior negotiations, discussions,
     representations, agreements and understandings heretofore had among the
     parties with respect thereto are merged herein.

          (c) This Amendment may be executed in duplicate counterparts, each of
     which shall be deemed an original and all of which, when taken together,
     shall constitute one and the same instrument.

          (d) This Amendment shall not be binding upon Landlord or Tenant unless
     and until Landlord shall have delivered a fully executed counterpart of
     this Amendment to Tenant.

          (e) This Amendment shall be binding upon and inure to the benefit of
     Landlord and Tenant and their successors and permitted assigns.

          (f) This Amendment shall be governed by the laws of the State of New
     York without giving effect to conflict of laws principles thereof.

          (g) The captions, headings, and titles in this Amendment are solely
     for convenience of reference and shall not affect its interpretation.

                                        6
<PAGE>

     IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of
the day and year first above written.

                                          LANDLORD:

                                          RCPI LANDMARK PROPERTIES, L.L.C.
                                          By: Tishman Speyer Properties, L.P.,
                                          its Agent

                                          By:     /s/ ROBERT J. SPEYER
                                            ------------------------------------
                                                  Name: Robert J. Speyer
                                                 Title: Managing Director

                                          TENANT:

                                          LEVIN MANAGEMENT CO., INC.
                                          By:      /s/ GLENN A. AIGEN
                                            ------------------------------------
                                                   Name: Glenn A. Aigen
                                          Title: Senior Vice President and Chief
                                                    Financial Officer

The undersigned acknowledges and
agrees that the terms and conditions
contained in the Original Lease, as
amended by the above Amendment, are
considered part of the obligations
guaranteed by the undersigned pursuant
to that certain Guaranty executed on
July 31, 1996, and the undersigned
hereby confirms that its obligations
under such Guaranty are ratified and
shall remain and continue in full
force and effect with respect to the
Lease.

JOHN A. LEVIN & CO.

By:        /s/ NORRIS NISSIM
    ----------------------------------
         Name: Norris Nissim
  Title: Vice President and General
                   Counsel

                                        7
<PAGE>

                                                                       EXHIBIT A

                         18TH FLOOR PREMISES FLOOR PLAN

     The floor plan that follows is intended solely to identify the general
location of the 18th Floor Premises of the Building and should not be used for
any other purpose. All areas, dimensions, and locations are approximate, and any
physical conditions indicated may not exist as shown.

                                  See Attached

</TEXT>
</DOCUMENT>
</SUBMISSION>
