Edgar Filing: INSIGNIA FINANCIAL GROUP INC /DE/

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

FORM 10-K/A

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

FOR THE FISCAL YEAR ENDED DECEMBER 31, 2002

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

For the Transition Period from _________ to _________

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Commission File Number 1-14373

INSIGNIA FINANCIAL GROUP, INC.
(Exact Name of Registrant as Specified in Its Charter)

DELAWARE 56-2084290
(State of Incorporation) (I.R.S. Employer Identification No.)

200 PARK AVENUE, NEW YORK, NEW YORK 10166
(Address of Principal Executive Offices) (Zip Code)

(212) 984-8033
(Registrant's Telephone Number, Including Area Code)

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Securities registered pursuant to Section 12(b) of the Act:

Title of each class Name of exchange on which registered

Common Stock, Par Value $0.01 Per Share New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

None

(Title of Class)

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 report), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No .
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. { X }

At June 30, 2002 there were 23,169,503 shares of common stock outstanding. Based
on the reported closing price of $9.72 per share on the New York Stock Exchange
on such date, the aggregate market value of common stock held by non-affiliates
of the Registrant was approximately $206 million.

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PART III

The Annual Report on Form 10-K for the year ended December 31, 2002, as
filed on March 21, 2003 (the "Form 10-K"), of Insignia Financial Group, Inc.
("Insignia" or the Company"), is hereby amended to include the following items.
Capitalized terms which are not defined herein have the same meanings ascribed
thereto in the Form 10-K.

ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The following provides information about each director of Insignia as of
April 15, 2003. Information about Insignia's executive officers is included in
Item 1 of the Form 10-K.

ANDREW L. FARKAS

Andrew L. Farkas, 42, has been a director and Chairman of Insignia since
its inception in May 1998 and Chief Executive Officer of Insignia since August
1998. Mr. Farkas served as a director of the Company's former parent from its
inception in August 1990 until the AIMCO merger in September 1998 and as
Chairman and Chief Executive Officer of the former parent from January 1991
until September 1998. Mr. Farkas also served as Chairman of the Board of
Trustees of Insignia Properties Trust, a publicly traded real estate investment
trust ("REIT") subsidiary of the former parent, from December 1996 until
February 1999 (when it was merged into AIMCO) and as Chief Executive Officer of
Insignia Properties Trust from December 1996 until September 1998.

STEPHEN B. SIEGEL

Stephen B. Siegel, 58, has been a director of Insignia since its inception
in May 1998 and President of Insignia since August 1998 and is Chairman and
Chief Executive Officer of Insignia/ESG. Mr. Siegel served as President of the
Edward S. Gordon Company Incorporated (now Insignia/ESG) from June 1992 to May
1998. Mr. Siegel is a director of Liberty Property Trust, a REIT.

ALAN C. FROGGATT

Alan C. Froggatt, 53, has been a director of Insignia since March 2001. Mr.
Froggatt is Chief Executive Officer of Insignia's European Operations and is
Chief Executive of Insignia Richard Ellis. Richard Ellis Group Limited, one of
the United Kingdom's leading property service firms, was acquired by Insignia in
February 1998. Mr. Froggatt joined Richard Ellis Group Limited in 1971, becoming
a Partner in 1984. Mr. Froggatt became Managing Partner of that firm in 1995 and
Chief Executive following its incorporation in 1997.

ROBERT G. KOEN

Robert G. Koen, 56, has been a director of Insignia since its inception in
May 1998. Since February 1996, Mr. Koen has been a partner in the law firm of
Akin, Gump, Strauss, Hauer & Feld, LLP, which represents Insignia and certain of
its affiliates from time to time.

ROBIN L. FARKAS

Robin L. Farkas, 69, has been a director of Insignia since its inception in
May 1998. Mr. Farkas is currently a self-employed private investor. From March
1994 to March 1995, Mr. Farkas was Chairman of the Dormitory Authority of the
State of New York, and from 1984 until 1993 Mr. Farkas was the Chairman of the
Board and Chief Executive Officer of Alexander's Inc., a real estate company. He
is also a director of REFAC Technology, a company engaged in the licensing of
intellectual property rights and product design and development, and Chairman
and a director of ICF Ventures LLC, a venture capital firm investing in India.
Mr. Farkas is the father of Andrew L. Farkas.

ROBERT J. DENISON

Robert J. Denison, 61, has been a director of Insignia since its inception
in May 1998. Mr. Denison has been General Partner of First Security Company II,
L.P., an investment advisory firm, for more than the past five years.

H. STRAUSS ZELNICK

H. Strauss Zelnick, 45, has been a director of Insignia since August 1998.
Mr. Zelnick is a media and entertainment executive with experience in the
television, video, motion picture, entertainment software and recorded music
industries. He is a principal of ZelnickMedia Corporation, and Chairman of
Nippon Columbia Co., Ltd. Mr. Zelnick was President and Chief Executive Officer
of BMG Entertainment, a division of Bertelsmann AG, from July 1998 through
December 2000. Mr. Zelnick was President and Chief Executive Officer of BMG
Entertainment North America, a division of BMG Entertainment, from January 1995
to June 1998. Prior to joining BMG Entertainment, Mr. Zelnick was President and
Chief Executive Officer of Crystal Dynamics, a supplier of video game software,
from 1993 to 1994, and prior to that he was President and Chief Operating
Officer of Twentieth Century Fox. Mr. Zelnick is a director of On2.com, a
provider of audio-visual encoding software.

STEPHEN M. ROSS

Stephen M. Ross, 62, has been a director of Insignia since May 2001. Mr.
Ross is the Chairman, Chief Executive Officer and managing general partner of
The Related Companies, L.P., a real estate firm with divisions specializing in
development, acquisitions, financial services and property management. Mr. Ross
founded the company in 1972.

ITEM 11 - EXECUTIVE COMPENSATION

The following table and the notes thereto sets forth certain information
concerning compensation earned or paid to Insignia's Chief Executive Officer and
each of the four other most highly compensated executive officers serving as
such at December 31, 2002 (the "Named Executive Officers") for services rendered
to the Company during each of the past three fiscal years.

SUMMARY COMPENSATION TABLE

LONG-TERM COMPENSATION
ANNUAL COMPENSATION AWARDS
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RESTRICTED SECURITIES
OTHER ANNUAL STOCK UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION SALARY BONUS (1) COMPENSATION AWARDS ($) OPTIONS (#) COMPENSATION
-------------------------------------------- ---------- ------------ ------------- ---------- ----------- -----------------

Andrew L. Farkas 2002 $ 1,000,000 $ 1,500,000 $ 63,173(2) ---- ---- $ 1,533,246(3)
Chairman of the Board of Directors 2001 1,000,000 2,200,000 59,922(2) ---- ---- 1,060,601(4)
and Chief Executive Officer 2000 1,000,000 4,000,000 ---- ---- 1,000,000 775,596(5)

Stephen B. Siegel 2002 $ 1,000,000 $ 750,000 $ ---- ---- ---- $ 3,930,254(3)(6)
Director and President; Chairman 2001 1,000,000 1,000,000 ---- ---- ---- 3,770,536(4)(6)
and Chief Executive Officer of 2000 1,000,000 4,000,000 ---- ---- ---- 1,983,593(5)(6)
Insignia/ESG, Inc.

Frank M. Garrison 2002 $ 500,000 $ 150,000 $ ---- ---- 100,000 $ 2,465,139(3)(7)
Office of the Chairman and 2001 500,000 200,000 ---- ---- ---- 2,532,290(4)(7)
President of Insignia Financial 2000 500,000 800,000 ---- ---- 200,000 1,425,250(5)(7)
Services, Inc.

Ronald Uretta 2002 $ 600,000 $ 200,000 $ ---- ---- ---- $ 1,714,597(3)(7)
Chief Operating Officer and 2001 500,000 400,000 ---- ---- ---- 2,246,992(4)(7)
Treasurer, President of 2000 500,000 900,000 ---- ---- 200,000 1,315,620(5)(7)
Insignia/ESG, Inc. and President
of Insignia Residential Group, Inc.

James A. Aston 2002 $ 550,000 $ 200,000 $ ---- ---- ---- $ 1,685,609(3)(7)
Chief Financial Officer 2001 500,000 200,000 ---- ----- ---- 2,260,680(4)(7)
2000 500,000 800,000 ---- ---- 200,000 1,312,827(5)(7)

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(1) Annual bonus awards for the Named Executive Officers have been established
by the Compensation Committee of the Company's Board of Directors and are
determined by reference to separate financial hurdles. For 2002, the
initial hurdle with respect to Messrs. Farkas, Garrison and Aston was
earnings per share of $0.81 (before the cumulative effect of changes in
accounting principles), with higher hurdles through $1.10 per share coupled
with a 10% increase in stock price. For 2002, the initial hurdle for
Messrs. Siegel and Uretta was earnings before taxes and intangible
amortization from service operations of $34,744,000. In all instances, the
earnings hurdles are based on actual results achieved by the Company,
adjusted to exclude the impact of capital transactions, including without
limitation, acquisitions, the entry into new businesses and debt or equity
financings. For 2002, the first financial hurdle was met with respect to
each of the Named Executive Officers resulting in the bonus amounts shown
in the table above. The performance hurdles for the second and third bonus
targets were not met. In respect of 2001, the compensation committee
awarded discretionary non-deductible bonuses of $700,000 to Mr. Farkas and
$200,000 to Mr. Uretta beyond those provided for in the performance based
awards. The $700,000 bonus paid to Mr. Farkas was mistakenly characterized
in the 2002 Proxy Statement as a reimbursement of expenses for the use by
Insignia of a boat owned by Mr. Farkas.

(2) With respect to 2002, includes personal use of a company automobile of
$46,509 and personal aircraft usage of $13,241. With respect to 2001,
includes personal aircraft usage of $50,300.

(3) Includes incentive payments (the right to which vested over time) made by
Insignia to, and proceeds with respect to previously granted equity
interests received by, each of the Named Executive Officers in connection
with proceeds from real estate investments, investments in entities owning
primarily securitized debt instruments and other real estate related
investments. The amount of such incentive payments and proceeds with
respect to previously granted equity interests paid to the Company's Named
Executive Officers was as follows: (i) Mr. Farkas: $1,055,787; (ii) Mr.
Siegel: $692,088; (iii) Mr. Garrison: $1,169,925; (iv) Mr. Uretta:
$570,322; and (v) Mr. Aston: $570,354. Also includes contractual payments
in connection with the sale of Realty One, the Company's single family
brokerage business sold in January 2002, as follows:

(i) Mr. Farkas: $297,500; (ii) Mr. Garrison: $148,750; (iii) Mr. Uretta:
$148,750; and (iv) Mr. Aston: $148,750. With respect to Mr. Uretta, also
includes a credit to the account of Mr. Uretta of $29,020 under Insignia's
non-qualified 401(k) Restoration Plan. With respect to Mr. Farkas and Mr.
Garrison, also includes non-deductible bonuses of $179,959 paid to each
pursuant to their employment agreement amendments.

(4) Includes incentive payments (the right to which vested over time) made by
Insignia to, and proceeds with respect to previously granted equity
interests received by, each of the Named Executive Officers in connection
with proceeds from real estate investments, investments in entities owning
primarily securitized debt instruments and other real estate related
investments. The amount of such incentive payments and proceeds with
respect to previously granted equity interests paid to the Company's Named
Executive Officers was as follows: (i) Mr. Farkas: $1,060,601; (ii) Mr.
Siegel: $319,797; (iii) Mr. Garrison: $1,616,966; (iv) Mr. Uretta:
$1,314,296; and (v) Mr. Aston: $1,345,356. With respect to Mr. Siegel and
Mr. Uretta, also includes a credit to the accounts of Messrs. Siegel and
Uretta of $129,196 and $17,372, respectively, under Insignia's
non-qualified 401(k) Restoration Plan.

(5) Includes incentive payments (the right to which vested over time) made by
Insignia to, and proceeds with respect to previously granted equity
interests received by, each of the Named Executive Officers in connection
with proceeds from real estate investments, investments in entities owning
primarily securitized debt instruments and other real estate related
investments. The amount of such incentive payments and proceeds with
respect to previously granted equity interests paid to the Company's Named
Executive Officers was as follows: (i) Mr. Farkas: $569,114; (ii) Mr.
Siegel: $157,089; (iii) Mr. Garrison: $662,025; (iv) Mr. Uretta: $526,915;
and (v) Mr. Aston: $526,915. Also includes the aggregate value at the grant
date of incentive awards consisting of equity interests in limited
partnerships, limited liability companies, and a private debt investment
fund granted to the Named Executives, as follows: (i) Mr. Farkas: $154,613;
(ii) Mr. Siegel: $12,113: (iii) Mr. Garrison: $662,025; (iv) Mr. Uretta:
$526,915; and (v) Mr. Aston: $526,915. With respect to Messrs. Farkas,
Siegel, Uretta and Aston, also includes a credit to their respective
accounts, as follows: (i) Mr. Farkas: $51,869; (ii) Mr. Siegel: $62,017:
(iii) Mr. Uretta: $37,467; and (iv) Mr. Aston: $34,674 under Insignia's
non-qualified 401(k) Restoration Plan.

(6) With respect to 2002, includes $2,987,832 in commissions and advances on
commissions and forgiveness of principal in the amount of $166,667 and
interest in the amount of $83,667 on loans from Insignia. With respect to
2001, includes $2,889,027 in commissions and advances on commissions and
forgiveness of principal in the amount of $333,333 and interest in the
amount of $99,183 on loans from Insignia. With respect to 2000, includes
$1,152,624 in commissions and advances on commissions and forgiveness of
principal in the amount of $500,000 and interest in the amount of $99,750
on loans from Insignia. Forgiveness of loans was made in accordance with
objective criteria established at the time the loans were made.

(7) Includes payments to Messrs. Garrison, Uretta and Aston received in respect
of contingent payment awards from the profits of certain real estate
investments retained by the Company's former parent (merged into Apartment
Investment and Management Company ("AIMCO") in October 1998) and awarded to
them while they were executive officers of the former parent. In the
Company's spin-off from its former parent in September 1998, AIMCO and the
Company agreed that AIMCO would, upon receipt of proceeds from the sale of
these assets, calculate the incentives that would have been due, if any,
and remit all amounts payable to these persons to the Company, and that the
Company would then distribute such amounts to the executive officers. The
Company has received certain amounts from AIMCO with respect to these
contingent payments and has paid, on a deferred basis together with
interest at the Company's cost of funds (approximately 5.25% at December
31, 2002) for the periods during which the Company held such amounts, to
each of Messrs. Garrison, Uretta and Aston the following amounts: (i)
$966,505 in 2002; (ii) $915,324 in 2001; and (iii) $739,125 in 2000. In
January 2003, final payments of approximately $1,010,000 were made under
this deferred compensation arrangement to each of Messrs. Garrison, Uretta
and Aston.

OPTION GRANTS DURING 2002

The following table and notes thereto sets forth information concerning
stock options granted by Insignia during fiscal 2002 to each of the Named
Executive Officers.

OPTION GRANTS IN FISCAL 2002

INDIVIDUAL GRANTS
------------------------------------------------------------------------------------------- POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES
OF STOCK
% OF TOTAL PRICE APPRECIATION
OPTIONS FOR
GRANTED TO EXERCISE OR BASE OPTION TERMS (C) (D)
OPTIONS GRANTED EMPLOYEES IN PRICE ($/SHARE) EXPIRATION ---------------------------
NAME (#) FISCAL YEAR (A) (B) DATE 5% 10%
----------------------- ----------------- --------------- ---------------- ------------- ------------- -----------

Andrew L. Farkas -- -- -- -- -- --
Stephen B. Siegel -- -- -- -- -- --
Frank M. Garrison 100,000 34.4% $10.69 10/4/07 $ 363,562 $824,799
Ronald Uretta -- -- -- -- -- --
James A. Aston -- -- -- -- -- --

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(a) During the year ended December 31, 2002, stock options representing an
aggregate of 290,000 shares of Insignia's common stock were issued to all
employees as a group.

(b) Exercise prices represent the fair market value, as determined by the Board
of Directors, on April 4, 2002, the date of grant. The exercise price may
be paid in cash, in shares of common stock valued at fair market value on
the date of exercise, or a combination thereof.

(c) The dollar amounts under these columns are the result of calculations at 5%
and 10% rates set by the Securities and Exchange Commission and therefore
are not intended to forecast possible future appreciation, if any, of
common stock price.

(d) All options become exercisable in five equal annual installments commencing
the year following the date of grant. Such options would immediately vest
in the event of a termination of employment for any reason other than a
termination for cause or voluntary termination, including, but not limited
to a death or disability termination event, termination without cause or in
the event of the occurrence of an Extraordinary Transaction, an Influence
Change Event or an Extraordinary Stock Event (as such terms are defined in
Mr. Garrison's employment agreement), such as the proposed acquisition of
Insignia by CBRE Holding, Inc..

OPTION EXERCISES AND VALUES FOR FISCAL 2002

The following table and notes thereto provides information concerning
options and warrants exercised in 2002 by the Named Executive Officers and the
value of such officers' unexercised options and warrants at December 31, 2002.

AGGREGATED OPTION EXERCISES IN FISCAL 2002 AND
FISCAL YEAR-END OPTION VALUES

VALUE OF UNEXERCISED
NUMBER OF SECURITIES IN-THE-MONEY
UNDERLYING UNEXERCISED OPTIONS AT
OPTIONS AT FISCAL YEAR-END(#)(a) FISCAL YEAR-END($)(a)(b)
-------------------------------- ----------------------------
SHARES ACQUIRED VALUE REALIZED
NAME ON EXERCISE(#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
------------------------ ---------------- ---------------- ------------- ---------------- ------------- ---------------

Andrew L. Farkas __ __ 1,012,230 37,770 __ __

Stephen B. Siegel __ __ 155,633 20,000 __ __

Frank M. Garrison __ __ 234,600 115,400 __ __

Ronald Uretta __ __ 234,600 15,400 __ __

James A. Aston __ __ 234,600 15,400 __ __

(a) Includes warrants.

(b) Calculated using the closing price of $7.25 per share of the Company's
common stock on December 31, 2002, less the option or warrant exercise
price. The exercise prices of all such options and warrants are greater
than $7.25 per share.

COMPENSATION RELATING TO INSIGNIA'S EQUITY INVESTMENTS AND OTHER INTERESTS IN
REAL ESTATE

Insignia has historically operated an equity investment program that
identifies investment opportunities for various clients. Pursuant to such equity
investment program, Insignia has invested alongside those clients or, in limited
instances, by itself, in the acquisition, development and/or operation of
qualifying real estate and real estate-related assets. In connection with this
equity investment program, selected employees of Insignia, including Messrs.
Farkas, Siegel, Garison, Uretta and Aston, received incentive awards tied to the
success of Insignia's investments in real estate and real estate related assets.
An award is made in the form of either (i) a letter agreement pursuant to which
Insignia agrees to pay to the recipient a specified percentage of a portion of
the proceeds as and when received by Insignia in respect of the applicable
investment asset, subject to vesting and other eligibility criteria, or (ii) a
direct or indirect assignment by Insignia of a portion of Insignia's equity
interest in the applicable investment asset, subject to forfeiture by the
recipient of all or a portion of that interest back to Insignia under certain
circumstances.

These incentive awards were granted subject to asset performance and
vesting provisions established on an investment-by-investment basis. Generally,
however, they entitle the Insignia employees, including the Named Executive
Officers, to receive approximately 50%, in the aggregate, of the cash proceeds
otherwise receivable by Insignia in respect of its equity investments in the
related investment assets, but only after Insignia has received a return of its
invested capital plus a 10% annual return on its invested capital, which is
determined on an investment-by-investment basis. In certain cases, further
grants ranging from 5% to 10% of these proceeds may be made available to
Insignia's employees based on a number of factors, including the degree of
success of a particular investment.

In the case of the awards relating to Insignia's equity investments in the
two private investment funds sponsored and managed by Insignia, Insignia
Opportunity Partners and Insignia Opportunity Partners II, L.P., Insignia
employees, including the Named Executive Officers, are entitled to receive,
respectively, 60% and 55%, in the aggregate, of the cash proceeds Insignia is
entitled to receive under the fund partnership agreements in respect of its
"promotional" or "over-ride" equity interests in those funds, which are the
incentive equity interests Insignia receives for serving as the general partner
of those funds. However, the recipients of the awards relating to those two
funds are not entitled to receive any portion of Insignia's capital invested in
those funds or any profits on those capital investments. The incentive awards
granted to Messrs. Farkas, Siegel, Garrison, Uretta and Aston with respect to
each investment asset generally approximates 25%, in

the aggregate, except that the incentive interests in Insignia Opportunity
Partners is 47.5%, in the aggregate, and in Insignia Opportunity Partners II,
L.P. is 41.75%, in the aggregate.

The incentive awards granted to Messrs. Farkas, Siegel, Garrison, Uretta
and Aston with respect to an investment generally approximates 25% of the amount
of cash proceeds for each investment in excess of Insignia's invested capital
and a 10% preferred return thereon otherwise receivable by Insignia. However,
the aggregate incentive awards granted to Messrs. Farkas, Siegel, Garrison,
Uretta and Aston with respect to Insignia's "promote" or "over-ride" interests
with respect to investments, including without limitation the Insignia
Opportunity Partners and Insignia Opportunity Partners II, L.P. investment
funds, generally are greater than 25% and some are as high as 47.5% of the
amount of cash proceeds otherwise receivable by Insignia only from such
"promote" or "over-ride" interests. In 2002, Insignia's investments in the
equity investment program yielded aggregate cash proceeds of $44.6 million, of
which $8.1 million was paid or accrued to employees who held incentive awards or
were granted incentive awards at the time of the realization of the proceeds and
$36.5 million was paid to Insignia. In some instances, selected employees of
Insignia, including Messrs. Farkas, Siegel, Garrison, Uretta and Aston, are
offered the opportunity to invest on the same basis as third-party investors.

For fiscal 2002, 2001 and 2000, Messrs. Farkas, Siegel, Garrison, Uretta
and Aston were granted payment rights and/or equity interests in five, four and
fifteen of such investments, respectively, under the equity investment program
in which Insignia invested (or has agreed to invest or provided guarantees for)
an aggregate of $4.6 million, $1.8 million and $13.5 million, respectively. The
aggregate value of these equity interests at the time of grant is included in
the Summary Compensation Table above.

In addition to these grants of payment rights and/or equity interests, in
fiscal 2002, 2001 and 2000, incentive payments with respect to payment rights
were made by Insignia to, and proceeds with respect to equity interests were
received by, each of Messrs. Farkas, Siegel, Garrison, Uretta and Aston in
connection with dispositions of assets or entities in such program, which
payments are identified and quantified in the Summary Compensation table and the
notes thereto.

COMPENSATION OF DIRECTORS

Directors who are also officers of Insignia do not receive any fee or
remuneration for services as members of the Insignia Board. During 2002, each of
Insignia's directors who is not an employee of Insignia received a fee of
$50,000 per year for serving as a director. Beginning in 2003, Insignia's
directors who are not employees of Insignia also receive $10,000 per year for
serving on a Committee of the Board of Directors and a further $5,000 per year
for serving as Chairman of a Committee.

Each director who was not a full-time employee of Insignia is also eligible
to participate in Insignia's 1998 Stock Incentive Plan, as amended and restated,
which provides for each non-employee director to receive at the time of his
initial election an option to purchase 20,000 shares of Insignia's common stock,
a portion of which is exercisable the year after the grant, and to receive an
additional option each year thereafter (on the first day of the first month
following the annual shareholder meeting) to purchase 2,000 shares, in each
case, having an exercise price per share equal to the fair market value per
share of Insignia's common stock.

SPECIAL COMMITTEE COMPENSATION

Robert J. Denison, Stephen M. Ross and H. Strauss Zelnick, the three
members of the Special Committee, each received compensation of $70,000 in
connection with serving on the Special Committee. Of such amount, $35,000 was
paid in the fourth quarter of 2002 and the remainder was paid in February 2003.

EMPLOYMENT AGREEMENTS AND COVENANTS NOT TO COMPETE

Set forth below is a description of the employment agreements between
Insignia and each of the Named Executive Officers.

Andrew L. Farkas

Andrew L. Farkas is employed by Insignia under an employment agreement, as
amended, which provides for him to serve as Chairman of the Board of Directors
and Chief Executive Officer until December 31, 2005, or such earlier date as
provided therein. Mr. Farkas's employment agreement provides for an annual
salary of $1,000,000, subject to such discretionary increases as may be
determined by the Insignia Board of Directors. In addition, Mr. Farkas may
receive (i) an annual performance bonus of up to $4,000,000 under the Incentive
Plan (if the Incentive Plan is approved by the

Company's Shareholders), based on Mr. Farkas's percentage participation in the
cash incentive pool generated under the Incentive Plan and the Company's
performance against objectives determined by the Compensation Committee of the
Board of Directors in accordance with the Incentive Plan, and (ii) an annual
discretionary bonus which the Compensation Committee may elect to pay Mr. Farkas
in such amount as it may determine to be appropriate. Mr. Farkas also is
entitled to certain perquisites. Mr. Farkas may elect to convert his employment
agreement into a consulting agreement with Insignia on substantially the same
terms as the employment agreement (except that Mr. Farkas shall cease to be an
officer and director of Insignia) if (a) without the prior written consent of
Mr. Farkas, his title, powers or duties within Insignia have been substantially
diminished, other than as a result of a termination by the Company for cause, or
(b) an Influence Change Event (as defined in Mr. Farkas's employment agreement)
occuring after or in connection with and Extraordinary Transaction (as defined
in Mr. Farkas's employment agreement), an Extraordinary Stock Event (as defined
in Mr. Farkas's employment agreement), or a Material Asset Disposition (as
defined in Mr. Farkas's employment agreement).

Under his employment agreement, in January 2000 Mr. Farkas was granted
options and warrants exercisable for an aggregate of 1,000,000 shares of common
stock at an exercise price of $8.00 per share. During the term of his employment
agreement, Mr. Farkas will continue to participate in Insignia's equity
investment program on the basis determined by the Compensation Committee. See
"Compensation Relating to Insignia's Equity Investments and Other Interests in
Real Estate" for a summary of Insignia's equity investment program.

Mr. Farkas's employment agreement also provides that he is eligible to
receive a performance-based bonus under the Incentive Plan in the amount of
$2,000,000, payable (if earned) out of Insignia's "promotional" or "over-ride"
interests in Insignia Opportunity Partners and/or Insignia Opportunity Partners
II, L.P., as more fully described under "Compensation Relating to Insignia's
Equity Investments in Real Estate." Of such amount, $179,959 had been paid as of
March 31, 2003. Payment of the remaining $1,820,041 to Mr. Farkas is dependent
upon the achievement of certain performance goals for the calendar year 2003
under the Incentive Plan (if the Incentive Plan is approved by the Company's
shareholders). The performance goal for this bonus is 10% of the Company's
EBITDA, as defined in the Incentive Plan, for calendar year 2003 (not to exceed
$18,200,410). Not withstanding the above, in the event of an Extraordinary
Transaction (as defined in Mr. Farkas's employment agreement), such as the
proposed acquisition of Insignia by CBRE Holding, Inc., prior to the end of the
2003 calendar year, Mr. Farkas shall be entitled to receive the full $1,820,041
at the time of the Extraordinary Transaction.

Mr. Farkas has agreed that for one year after the cessation of his
employment with Insignia, he will not, if such action would have a material
adverse effect on Insignia, in direct competition with Insignia, solicit
business from any of Insignia's customers or clients with whom he has had
"material contact" (as defined in the employment agreement) during the 12 month
period preceding the date of cessation of his employment and he will neither
solicit Insignia's employees to work for any direct competitor of Insignia for
two years after the cessation of this employment with Insignia, nor interfere
with any contracts that exist between Insignia and any customers or clients as
of the effective date of the his employment agreement.

Mr. Farkas's employment will be terminated if Mr. Farkas is disabled during
his employment with Insignia, whereupon Insignia will pay him 75% of his
then-current base salary for a period of time equal to twice the remaining term
under the employment agreement immediately prior to his termination (but not
less than four years). If Mr. Farkas dies during the term of his employment
agreement, Insignia will pay to his estate his then-current base salary through
the expiration date of his employment agreement. In addition, if Mr. Farkas
dies, is disabled or is terminated without cause during the term of the
employment agreement, Insignia will continue to pay all perquisites to which Mr.
Farkas is entitled and will pay all bonuses to be paid to Mr. Farkas upon the
occurrence of a significant event or transaction (involving Insignia) or the
disposition (by Insignia of a significant amount of its assets) to Mr. Farkas or
his estate if the significant event or transaction or the material asset
disposition giving rise to such payment occurs, or a definitive agreement
regarding such event has been executed (a) before or within 180 days after the
termination of Mr. Farkas's employment due to his death, (b) before or within
185 days after the termination of Mr. Farkas's employment due to his disability
or (c) before the expiration date of his employment agreement in the event Mr.
Farkas's employment is terminated without cause. Following cessation of
employment with Insignia for any reason, Mr. Farkas will be entitled to
continue, at his sole cost, any and all life insurance policies on his life then
maintained by Insignia and to purchase from or through Insignia, at his sole
cost, individual and dependent health care insurance coverage.

Mr. Farkas's employment agreement provides that upon the occurrence of a
significant event or transaction involving Insignia, including, but not limited
to, any change of control (as defined in the employment agreement) of Insignia,
such as the proposed acquisition of Insignia by CBRE Holding, Inc., Insignia
will be required to pay to Mr. Farkas an amount equal to 1.0% of the total
equity market capitalization of Insignia on the date the significant event or
transaction occurs. Upon the occurrence of a significant event or transaction
(whether or not resulting in the termination of Mr. Farkas's employment), and/or
upon termination for any reason, including Mr. Farkas's death but excluding
termination for cause or

voluntary termination by Mr. Farkas, all options and warrants, all grants of
equity participation (see "Compensation Relating to Insignia's Equity
Investments and Other Interests in Real Estate") granted to Mr. Farkas will vest
immediately and be exercisable. The employment agreement also provides that if
Insignia enters into a transaction resulting in (i) a majority of the equity
interest in Insignia being beneficially owned by a person or persons who is not
an affiliate of Insignia, or (ii) a material asset disposition, Insignia will
pay to Mr. Farkas a cash bonus equal to 1.0% of the consideration received by
Insignia or its stockholders as a result of such material asset disposition.

To the extent Mr. Farkas would be subject to the excise tax under Section
4999 of the Internal Revenue Code on amounts or benefits to be received from
Insignia required to be included in the calculation of parachute payments for
purposes of the Internal Revenue Code, the amounts of any such payments will be
automatically reduced to an amount one dollar less than an amount that would
subject Mr. Farkas to the excise tax under Section 4999 of the Internal Revenue
Code, provided that the automatic reduction would apply only if the reduced
payments received by Mr. Farkas (after taking into account further reductions
for applicable taxes) would be greater than his unreduced payments, after
applicable taxes.

Stephen B. Siegel

Stephen B. Siegel is employed by Insignia and its subsidiary, Insignia/ESG,
pursuant to an employment agreement, as amended, which provides for him to serve
as President of Insignia and Chairman and Chief Executive Officer of
Insignia/ESG until December 31, 2005, subject to earlier termination or
extension as provided in the agreement. The employment agreement provides that
Mr. Siegel is to receive (i) a base annual salary of $1,000,000, (ii) 30% of all
commission revenues earned, received and retained by Insignia/ESG in respect of
transactions as to which Mr. Siegel has rendered services recognized by
Insignia/ESG, and (iii) 50% of all net commissions in respect of agency
transactions as to which Mr. Siegel has rendered services recognized by
Insignia/ESG. The employment agreement also provides that Mr. Siegel will
receive, for each year or part thereof during the employment term, an amount (up
to a maximum of $400,000 annually) equal to 0.6% of the gross commissions
earned, received and retained by Insignia/ESG, but only to the extent that
Insignia/ESG and all of its wholly-owned subsidiaries meet or exceed its annual
EBITDA (as defined below) budget, as established by the Compensation Committee,
after reduction for all bonus compensation paid to employees of Insignia/ESG
(including the imputed bonus of Mr. Siegel), all Insignia/ESG overhead
allocations and all other compensation paid to Mr. Siegel, which annual EBITDA
budget will be increased by the Compensation Committee for each subsequent year
by an amount of no less than 10% of the annual EBITDA budget for the immediately
preceding year. "EBITDA" means earnings before interest, taxes, depreciation and
amortization, computed in accordance with generally accepted accounting
principles, consistently applied. The employment agreement further provides that
Mr. Siegel will receive for each year an annual bonus of up to $2,500,000 under
the Incentive Plan (if the Incentive Plan is approved by the Company's
shareholders) based upon Mr. Siegel's percentage participation in the cash
incentive pool generated under the Incentive Plan and the Company's performance
against objectives determined by the Compensation Committee in accordance with
the Incentive Plan.

In addition, upon the consummation of a transaction resulting in a change
in the ownership of a majority of the issued and outstanding shares of Insignia
common stock and a change in the majority of the Insignia Board of Directors,
Mr. Siegel is entitled to receive a payment in the amount of 0.5% of the
consideration received by Insignia or its stockholders as direct result of such
transaction (excluding the assumption or repayment of debt or other
liabilities), which payment is required to be made upon the earlier of the
involuntary termination of Mr. Siegel's employment with Insignia other than for
cause, or the expiration of the term of his employment agreement.

Finally, in 2002, Mr. Siegel's $50,000 monthly advance payments were
eliminated and replaced with an additional 20% commission on net and promotional
commission revenue earned by Insignia, subject to a maximum of $50,000 in extra
commissions per month to Mr. Siegel. Any extra commission amounts earned by Mr.
Siegel in excess of the $50,000 monthly maximum are carried forward to
subsequent months in which the $50,000 maximum is not reached by Mr. Siegel. All
of these extra commissions are recoupable from Mr. Siegel's annual bonus, equity
investment program payments and other amounts payable to Mr. Siegel in respect
of the calendar year in which the extra commissions were paid (other than base
salary). If such amounts are not sufficient to fully recoup the extra commission
amounts paid to Mr. Siegel, Mr. Siegel will not be obligated to repay those
amounts to Insignia. Any extra commissions paid in a calendar year will be
forfeited and repaid if Mr. Siegel terminates or resigns his employment
voluntarily or is terminated by the Company or Insignia/ESG for cause.

Insignia/ESG has purchased, at Insignia/ESG's expense, term life insurance
on the life of Mr. Siegel with a death benefit of $5,000,000, the beneficiaries
of which are designated by Mr. Siegel.

Mr. Siegel's employment agreement provides that Mr. Siegel will not compete
with either Insignia or Insignia/ESG for two years after the termination of the
employment agreement. If Mr. Siegel is terminated without cause, Mr. Siegel may
elect to observe the non-compete agreement and receive the compensation provided
for in his employment agreement until December 31, 2005 or to accept other
employment that violates the non-compete provision and receive compensation at a
rate of $1,000,000 per year until December 31, 2005, less the aggregate
compensation payable to him for such new employment. If Mr. Siegel is terminated
for cause (as defined in the employment agreement), Insignia and Insignia/ESG
are required to pay Mr. Siegel only his base salary up to and including the date
on which the termination occurred. Upon Mr. Siegel's death, Insignia or
Insignia/ESG is required to pay Mr. Siegel's estate compensation at the annual
rate of $1,000,000 during the remaining term of his employment agreement, not to
exceed one year.

Under the employment agreement, on September 21, 1998 Mr. Siegel received a
grant of options to purchase 100,000 shares of Insignia's common stock at $12.62
per share.

Frank M. Garrison, James A. Aston and Ronald Uretta

Messrs. Frank M. Garrison, James A. Aston and Ronald Uretta are employed by
Insignia under employment agreements, as amended, which provide for Mr. Garrison
to serve as Office of the Chairman and Executive Managing Director of Insignia
and President and Chief Executive Officer of Insignia's subsidiary, Insignia
Financial Services, Inc., for Mr. Aston to serve as Chief Financial Officer of
Insignia and for Mr. Uretta to serve as Chief Operating Officer of Insignia
until December 31, 2004 (December 31, 2005, in the case of Mr. Garrison), or
such earlier or later date as provided in their agreements. Mr. Garrison's
employment agreement provides that if Insignia has not notified him of its
intention not to extend or renew the agreement by December 31, 2005, the term
will automatically extend so that its expiration date will be not less than six
months from the date that Insignia notifies him of its intent not to renew or
extend the term. Messrs. Garrison, Aston and Uretta each are to receive a base
salary of $500,000, $550,000 and $600,000 per year, respectively, subject to
such discretionary increases as may be determined by the Insignia Board of
Directors, and a bonus determined by the Compensation Committee. Messrs.
Garrison, Aston and Uretta also are entitled to certain perquisites. Messrs.
Garrison, Aston and Uretta each has agreed that for one year after the
termination of his employment agreement, he will not solicit business from any
of Insignia's customers or clients with whom he has had "material contact"
during the 12-month period preceding the date of cessation of his employment
with Insignia, and he will neither solicit Insignia's employees to work for any
of Insignia's direct competitors nor purchase more than 1% of the outstanding
limited partner units of any partnerships controlled directly or indirectly by
Insignia for two years after the termination of his employment agreement.

Each of the employment agreements provides that it will be terminated if
Mr. Garrison, Aston or Uretta, as applicable, is disabled during his employment
with Insignia, whereupon Insignia is required to pay his salary through the
expiration date of the agreement and to pay all bonuses to be paid upon the
occurrence of a significant event or transaction involving Insignia or the
disposition of a significant amount of Insignia's assets if the event giving
rise to such payment occurs, or a definitive agreement regarding such event is
executed, before or within 180 days after such termination. If Mr. Garrison,
Aston or Uretta, as applicable, dies during the term of his employment
agreement, Insignia is required to pay to his estate his salary through the
expiration date of the agreement, and to pay all bonuses to be paid upon the
occurrence of a significant event or transaction involving Insignia or the
disposition of a significant amount of Insignia's assets if the event giving
rise to such payment occurs, or a definitive agreement regarding such event is
executed, before or within 180 days after his death. If Mr. Garrison, Aston or
Uretta, as applicable, is terminated without cause, Insignia is required to pay
his salary and all bonuses to be paid upon the occurrence of a significant event
or transaction or the disposition of a significant amount of Insignia's assets
through the expiration date of the agreement. Upon termination without cause, or
due to Mr. Garrison's, Aston's or Uretta's death or disability, all options and
warrants granted to Mr. Garrison, Aston or Uretta, as applicable, will
immediately vest and be exercisable. Following his cessation of employment with
Insignia for any reason, each of Messrs. Garrison, Aston, and Uretta will be
entitled to continue, at his sole cost, any and all life insurance policies on
his life then maintained by Insignia and to purchase from or through Insignia,
at his sole cost, individual and dependent health care insurance coverage.

Upon the occurrence of a significant event or transaction involving
Insignia, Messrs. Garrison, Aston and Uretta each may elect to convert his
employment agreement into a consulting agreement with substantially the same
terms and conditions, except that the consulting services provided by Messrs.
Garrison, Aston and Uretta, as applicable, shall be provided to Insignia at
reasonable times convenient to each of them on no less than five business days'
notice. The employment agreements also provide that upon the occurrence of the
disposition of a significant amount of Insignia's assets, Insignia is required
to pay each of Messrs. Garrison, Aston and Uretta a cash bonus equal to 0.5% (or
0.25% if he was a non-employee consultant to Insignia or made himself reasonably
available to consult with Insignia at the time of execution of the definitive
agreement regarding such disposition, but is not so reduced if the employment
agreement is

converted to a consulting agreement in connection with the transaction giving
rise to the significant disposition of assets) of the consideration received by
Insignia or its stockholders as a result of such material asset disposition
(excluding the assumption or repayment of debt or other liabilities).

To the extent Mr. Garrison, Aston or Uretta would be subject to the excise
tax under Section 4999 of the Internal Revenue Code on amounts or benefits to be
received from Insignia required to be included in the calculation of parachute
payments for purposes of Sections 280G and 4999 of the Internal Revenue Code,
the amounts of any such payments will be automatically reduced to an amount one
dollar less than an amount that would subject Mr. Garrison, Aston or Uretta, as
applicable, to the excise tax under Section 4999 of the Internal Revenue Code,
provided that the automatic reduction would apply only if the reduced payments
received by Mr. Garrison, Aston or Uretta, as applicable (after taking into
account further reductions for applicable taxes) would be greater than the
unreduced payments to be received by him, after applicable taxes.

Mr. Garrison and Insignia have executed an amendment to Mr. Garrison's
employment agreement that in addition to extending the term of his employment
agreement to December 31, 2005, subject to earlier termination as set forth in
his employment agreement, provides that (i) as of January 1, 2003, such date
will be used as the "effective date" for purposes of measuring all benefits,
restrictions and/or obligations in Mr. Garrison's employment agreement with a
duration component; (ii) Mr. Garrison will be granted an option to purchase
100,000 shares of Insignia's common stock at $10.69 per share, which was granted
on April 4, 2002; and (iii) Mr. Garrison will be paid a retention bonus in the
amount of $500,000, all of which had been paid as of March 31, 2003. The
retention bonus was payable in installments from 33.5% of the cash proceeds, if
any, otherwise receivable by Insignia with respect to its "promotional" or
"over-ride" interest in Insignia Opportunity Partners and Insignia Opportunity
Partners II, L.P., but not from the return of or on any of Insignia's actual
investment therein or any fees received by Insignia in respect of acquisition or
asset management services.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

During 2002, Messrs. H. Strauss Zelnick and Stephen M. Ross (non-employee
directors) served as members of the Compensation Committee. None of the
Compensation Committee members or executive officers has any relationships that
require disclosure under this caption.

ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT

The following table sets forth, as of as of April 15, 2003, certain
information with respect to shares of the Company's common stock beneficially
owned by each of Insignia's directors, by the Named Executive Officers, by all
of its directors and executive officers as a group and by persons believed by
the Company to be the beneficial owners of more than five percent of the issued
and outstanding shares of common stock. Such persons have sole voting power and
sole dispositive power with respect to all shares set forth in the table unless
otherwise specified in the notes thereto.

NAME OF NUMBER OF SHARES PERCENT OF
BENEFICIAL OWNER BENEFICIALLY OWNED CLASS
---------------- ------------------ -----

Andrew L. Farkas 2,428,465(1) 9.8%
Insignia Financial Group, Inc.
200 Park Avenue
New York, NY 10166

Dimensional Fund Advisors, Inc. 2,061,731(2) 8.7%
1299 Ocean Avenue, 11th Floor
Santa Monica, CA 90401

Stephen Feinberg 2,665,819(3) 11.2%
450 Park Avenue, 28th Floor
New York, New York 10022

Eminence Capital, L.L.C., 1,406,000(4) 5.9%
200 Park Avenue

NAME OF NUMBER OF SHARES PERCENT OF
BENEFICIAL OWNER BENEFICIALLY OWNED CLASS
---------------- ------------------ -----

Suite 3300
New York, New York 10166

Carl C. Icahn 1,753,700(5) 7.4%
High River Limited Partnership
Barberry Corporation
767 Fifth Avenue
47th Floor
New York, New York 10153

James A. Aston 303,979(6) 1.3%

Robert J. Denison 53,266(7) *

Robin L. Farkas 229,634(8) 1.0%

Alan C. Froggatt 35,195(9) *

Frank M. Garrison 272,895(10) 1.1%

Robert G. Koen 53,000(11) *

Stephen M. Ross 12,000(12) *

Stephen B. Siegel 180,000(13) *

Ronald Uretta 300,540(14) 1.3%

H. Strauss Zelnick 64,000(15) *

All directors and executive officers as a group (13 3,986,306(1) (6)-(16) 16.8%
individuals)

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

(*) Denotes less than 1%.

(1) Includes shares owned by (i) Metro Shelter Directives, Inc. and (ii) F III,
Inc. Also includes 1,040,000 shares subject to options and warrants that
are or will become exercisable within 60 days.

(2) Dimensional Fund Advisors, Inc. ("Dimensional"), an investment advisor
registered under Section 203 of the Investment Advisers Act of 1940,
furnishes investment advice to four investment companies registered under
the Investment Company Act of 1940, and serves as investment manager to
certain other investment vehicles, including commingled group trusts (These
investment companies and investment vehicles are the "Funds"). In its role
as investment adviser and investment manager, Dimensional possessed both
investment and voting power over 2,061,731 shares of Common Stock. The
Portfolios own all securities reported in this statement, and Dimensional
disclaims beneficial ownership of such securities. The foregoing is based
upon a Schedule 13G/A filed by Dimensional with the Commission dated
February 13, 2003.

(3) 250,000 shares of Series A convertible preferred stock and 125,000 shares
of Series B convertible preferred stock (collectively, the "Preferred
Stock") of the Company are held of record by Madeleine L.L.C. on behalf of
various private investment funds referred to below which are managed by
Stephen Feinberg. Mr. Feinberg possesses sole voting and investment
authority over such shares. The Preferred Stock is convertible at any time
into a total of 2,597,402 shares of Common Stock. The private

investment funds include Cerberus Partners, L.P., Cerberus Institutional
Partners, L.P. and Cerberus International, Ltd. The foregoing is based upon
a Schedule 13D/A filed by Mr. Feinberg with the Commission dated June 28,
2002. Also includes a total of 68,417 shares of Common Stock issued as
dividends paid on the Preferred Stock prior to June 18, 2002.

(4) Eminence Capital, LLC ("Eminence") serves as the beneficial owner of
1,406,000 shares on behalf of a number of private investment vehicles and
managed accounts advised by Eminence. The foregoing is based upon a
Schedule 13G/A filed by Eminence with the Commission dated February 13,
2003.

(5) Barberry Corp., a Delaware corporation ("Barberry"), is the general partner
of High River Limited Partnership, a Delaware limited partnership ("High
River"). Barberry is 100% owned by Carl C. Icahn. As such, Mr. Icahn is in
a position directly and indirectly to determine the investment and voting
decisions made by Barberry and High River. The foregoing is based upon a
Schedule 13G/A filed by Mr. Icahn with the Commission dated February 10,
2003.

(6) Includes 240,000 shares subject to options and warrants that are or will
become exercisable within 60 days and 129 shares held in an IRA. Also
includes 8,934 shares owned by Mr. Aston's children, with respect to which
Mr. Aston disclaims beneficial ownership.

(7) Includes 266 shares held by First Security Management, Inc., a corporation
of which Mr. Denison is the president and sole shareholder. Also includes
53,000 shares subject to options and warrants that are or will become
exercisable within 60 days.

(8) Includes 53,000 shares subject to options and warrants that are or will
become exercisable within 60 days. Also includes 7,998 shares owned by Mr.
Farkas's spouse, with respect to which Mr. Farkas disclaims beneficial
ownership.

(9) Includes 9,794 shares subject to options that are or will become
exercisable within 60 days. Also includes 3,396 shares owned by Mr.
Froggatt's spouse, with respect to which Mr. Froggatt disclaims beneficial
ownership.

(10) Includes 260,000 shares subject to options and warrants that are or will
become exercisable within 60 days.

(11) Includes 53,000 shares subject to options and warrants that are or will
become exercisable within 60 days.

(12) Includes 12,000 shares subject to options and warrants that are or will
become exercisable within 60 days.

(13) Includes (a) 80,000 shares subject to options that are or will become
exercisable within 60 days, and (b) 350 shares owned by Mr. Siegel's child,
with respect to which Mr. Siegel disclaims beneficial ownership.

(14) Includes (a) 240,000 shares subject to options and warrants that are or
will become exercisable within 60 days, and (b) 133 shares owned by Mr.
Uretta's spouse and 2,238 shares owned by Mr. Uretta's children, with
respect to which Mr. Uretta disclaims beneficial ownership.

(15) Includes 53,000 shares subject to options and warrants that are or will
become exercisable within 60 days.

(16) Includes 24,000 shares subject to options and warrants that are or will
become exercisable within 60 days.

ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

EMPLOYEE LOANS

In March 2002, Insignia made a loan in the amount of $1,500,000 to Andrew
L. Farkas. The variable interest rate on the loan is the same as the cost of
funds borrowed by Insignia, which was approximately 5.25% at December 31, 2002.
The loan is payable on or before March 5, 2005. The Company deducts quarterly
interest payments due on the loan from certain bonuses payable to Mr. Farkas. To
the extent such bonuses are not paid, all accrued and unpaid interest is payable
at maturity. The loan and any accrued interest thereon would be forgiven in
limited circumstances, such as a significant transaction or change of control,
such as the proposed acquisition of Insignia by CBRE Holding, Inc. The loan is
recourse only to certain rights Mr. Farkas may have to receive payments from the
Company's 401(k) Restoration Plan. As of March 31, 2003, $1,500,000 of the
principal amount of such loan and accrued interest thereon of $8,038 remained
outstanding.

In June 2001, Insignia made a loan in the amount of $1,500,000 to Mr.
Siegel. The variable interest rate on the loan is the same as the cost of funds
borrowed by Insignia, which was approximately 5.25% at December 31, 2002. The
loan becomes due upon the earliest of (i) voluntary termination of Mr. Siegel's
employment with Insignia, (ii) the termination of the Mr. Siegel's employment
with Insignia for cause or (iii) March 15, 2006. Insignia will forgive $375,000
of the principal amount of the loan and accrued interest thereon on March 15 of
the year following each of 2002, 2003, 2004 and 2005 to the extent that actual
Net EBITDA equals or exceeds 75% of annual budgeted Net EBITDA for any such
year, as approved by the Board of Directors. In addition, if aggregate actual
Net EBITDA for fiscal 2002, 2003, 2004 and 2005 equals or exceeds aggregate
annual budgeted EBITDA for such years, any outstanding principal amount of the
loan and accrued interest thereon, will be forgiven as of March 15, 2006. As of
March 31, 2003, $1,500,000 of the principal amount of such loan remained
outstanding.

In May 2002, Insignia made a loan in the amount of $270,000 to Jeffrey P.
Cohen, Executive Vice President of Insignia. The variable interest rate on the
loan is the same the cost of funds borrowed by Insignia, which was approximately
5.25% at December 31, 2002. Interest on the loan is payable to Insignia in cash
on June 30 and December 31 of each year; provided, however, that until December
31, 2004 all interest accrued and payable may, at the discretion of the employee
(but subject to Insignia's right of offset as more fully described below), be
added to the outstanding principal balance of the loan instead of paid in cash.
The loan is repayable on the earlier of (i) June 30, 2005 or (ii) 30 days
following a termination of the employee's employment with Insignia for any
reason. Pursuant to its rights under the note, beginning on August 1, 2002,
Insignia began withholding 50% of any distribution payable to the employee, in
respect of the employee's equity interest in the Company's profits interest in
Insignia Opportunity Partners, to be applied as a payment of accrued interest
first and then outstanding principal. As of March 31, 2003, $240,405 of the
principal amount of such loan and accrued interest thereon of $2,400 remained
outstanding.

In September 1999, Insignia/ESG made a loan in the amount of $500,000 to
Mr. Siegel. The interest rate on the loan was the same as the interest rate
applicable to funds borrowed by Insignia on its revolving credit facility, which
rate was approximately 4.9% at December 31, 2001. The balance of the loan
outstanding on March 31, 2001, $166,667, was forgiven by the Company on March
31, 2002.

In November 1998, Insignia made a loan to Mr. Siegel, pursuant to the
Insignia Financial Group, Inc. 1998 Supplemental Stock Purchase and Loan Program
(the "Supplemental Stock Purchase and Loan Program"), in the amount of $999,999
to purchase 76,923 shares of common stock. The loan is secured only by such
common shares and is non-recourse to Mr. Siegel except to the extent of 25% of
the outstanding amount. Mr. Siegel has agreed to repay the principal amount of
the loan and interest thereon (at a rate of 7.5% per annum) in 40 equal
quarterly installments commencing on March 31, 1999 and ending on December 31,
2008. As of March 31, 2003, $686,020 of the principal amount of such loan and
accrued interest thereon of $12,863 remained outstanding.

In October 1999, Insignia made a loan to Alan C. Froggatt, a director and
the Chief Executive Officer of Insignia's European Operations and of Insignia
Richard Ellis, pursuant to the Supplement Stock Purchase and Loan Program, in
the amount of $100,000 to purchase 12,121 shares of common stock. The loan is
secured only by such shares and is non-recourse to Mr. Froggatt except to the
extent of 25% of the outstanding amount. Mr. Froggatt has agreed to repay the
principal amount of the loan and interest thereon (at a rate of 7.5% per annum)
in 40 equal quarterly installments commencing on March 31, 2000 and ending on
December 31, 2009. As of March 31, 2003, $77,344 of the principal amount of such
loan and accrued interest thereon of $1,450 remained outstanding.

In November 1998, Insignia made a loan to Jeffrey P. Cohen, Executive Vice
President of Insignia, pursuant to the Supplemental Stock Purchase and Loan
Program, in the amount of $193,125 to purchase 15,000 shares of common stock.
The loan is secured only by such common shares and is non-recourse to Mr. Cohen
except to the extent of 25% of the outstanding amount. Mr. Cohen has agreed to
repay the principal amount of the loan and interest thereon (at a rate of 7.5%
per annum) in 40 equal quarterly installments commencing on March 31, 1999 and
ending on December 31, 2008. As of March 31, 2003, $132,487 of the principal
amount of such loan and accrued interest thereon of $2,484 remained outstanding.

TRANSACTIONS WITH MANAGEMENT AND OTHERS

Andrew L. Farkas, the Chief Executive Officer and Chairman of the Board of
Insignia, owns a fractional interest in an aircraft, which Mr. Farkas made
available to Insignia for its use. During 2002 and 2001, the Company paid
directly to the third party administrator of the fractional interest program
certain expenses pertaining to Mr. Farkas's aircraft totaling approximately
$469,000 and $513,000, respectively, including all monthly administrative costs
and operating expenses associated with the fractional interest. In addition,
during the nine months ended September 30, 2002, Insignia also paid Mr. Farkas a
fee with respect to his ownership interest aggregating $112,500 ($12,500
monthly). The arrangement was terminated effective September 30, 2002. In
addition, Insignia paid $247,500 and $697,777 in 2001 and 2000, respectively, to
Mr. Farkas as a reimbursement for business expenses in connection with the use
by Insignia employees, directors and clients of a boat (2001) and aircraft
(2000) owned by Mr. Farkas.

During the third and fourth quarters of 2002, the newly formed Governance
and Nominating Committee of the Company's Board of Directors undertook (i) a
review of expenses incurred by Mr. Farkas that were previously reimbursed by the
Company and (ii) the development of formal expense reimbursement policies and
procedures. During the fourth quarter of 2002, the Committee completed its
review of the previously reimbursed expenses and its formulation of the expense
reimbursement policies and procedures. As a result of the review, the Committee
recommended, and Mr. Farkas agreed, that Mr. Farkas would reimburse $1,391,414
of such expenses, of which $700,000 was paid in December 2002 and the remaining
$691,414 was paid on February 28, 2003. The Company's governance policies no
longer permit any reimbursement by the Company for any employee owned aircraft
or boat.

Robert G. Koen, a director of Insignia, is a partner in the law firm of
Akin, Gump, Strauss, Hauer & Feld, LLP, which represents Insignia or certain of
its affiliates from time to time. The amount of fees paid by the Company to
Akin, Gump, Strauss, Hauer & Feld, LLP during 2002, 2001 and 2000 totaled
$1,363,000, $59,000 and $589,000, respectively.

Insignia Bourdais leases space in a building in Paris, France, owned by
Jean Claude Bourdais, its Chief Executive Officer, and members of his family.
The lease continues through December 2007 and Insignia Bourdais has options to
extend the lease through December 2012. The lease was in effect in December 2001
when Insignia acquired Groupe Bourdais. During 2002, Insignia Bourdais paid
$890,000 rent under the lease. The lease provides for annual increases in the
rent. For 2003, the rent under the lease is expected to be approximately $1.1
million.

In April 2003, Insignia entered into a Referral Agreement with XO
Management Services, Inc. ("XO") pursuant to which Insignia will provide XO with
referrals of potential clients for XO's telecommunications services and other
related services. Carl Icahn, the beneficial owner of more than 5% of Insignia's
outstanding common stock, beneficially owns approximately 83.5% of the
outstanding common stock of XO Communications, Inc., the parent of XO. Any fees
paid by XO to Insignia are performance based and therefore cannot be projected
for 2003.