AMENDMENT AGREEMENT No. 7 AND WAIVER

     AMENDMENT  AGREEMENT  No. 7 AND WAIVER  dated as of December 31, 1999 among
FINLAY  ENTERPRISES,  INC., a Delaware  corporation (the "Parent"),  FINLAY FINE
JEWELRY CORPORATION,  a Delaware corporation (the "Company"),  the lenders named
herein and  signatory  hereto  (the  "Lenders")  and  GENERAL  ELECTRIC  CAPITAL
CORPORATION, as agent (the "Agent"), for the Lenders.

                             W I T N E S S E T H :

     WHEREAS,  the Parent, the Company, the Lenders and the Agent are parties to
an Amended and Restated  Credit  Agreement  dated as of  September  11, 1997 (as
heretofore and hereafter amended,  modified or supplemented from time to time in
accordance with its terms, the "Credit Agreement");

     WHEREAS,  Societe Nouvelle d'Achat de Bijouterie - S.O.N.A.B.,  an indirect
wholly-owned  subsidiary of the Company  ("Sonab"),  proposes to sell certain of
its assets (the "Asset  Sale") to Histoire  d'Or and a  wholly-owned  subsidiary
thereof  (collectively,  the "Buyer")  pursuant to an Asset  Purchase  Agreement
dated as of  December  23,  1999  between  Sonab  and  Buyer  and the  ancillary
documents related thereto (the "Asset Purchase Agreement"); and

     WHEREAS,  subject to the terms and conditions  contained herein the parties
hereto desire to amend or waive compliance with certain provisions of the Credit
Agreement in connection with the Asset Sale; and

     NOW THEREFORE, for good and valuable consideration, the receipt of which is
hereby acknowledged,  and subject to the fulfillment of the conditions set forth
below, the parties hereto agree as follows:

     1.  Defined  Terms.  Unless  otherwise  specifically  defined  herein,  all
capitalized  terms used herein shall have the  respective  meanings  ascribed to
such terms in the Credit Agreement.

     2. Waivers to the Credit  Agreement.  Upon the  Effective  Date (as defined
below):

     (a) Compliance by the Parent and the Company with the provisions of Section
9.4 is hereby waived in  connection  with the Asset Sale solely to allow for (i)
the escrow  arrangements  with respect to 80% of the Inventory Price (as defined
in the Asset Purchase Agreement) (excluding 1% of the adjusted book value of the
Inventory (as defined in the Asset Purchase  Agreement)) and the entirety of the
Nice Store Business Price (as defined in the Asset Purchase Agreement), and (ii)
the  deferred  payment of 20% of the  Inventory  Price (as  defined in the Asset
Purchase Agreement), or the remaining

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balance  thereof,  on December  31, 2000 (50% of which shall be paid to Sonab on
such date and 50% to be subject to escrow for an additional one year period).

     (b) Compliance by the Parent and the Company with the provisions of Section
9.5 of the Credit  Agreement  is hereby  waived  solely to allow for the sale of
assets  pursuant  to the Asset  Purchase  Agreement  and the  winding  up of the
operations of Sonab.

     3. Amendments to Credit Agreement. The Credit Agreement shall be amended as
follows upon the Effective Date (as defined below):

     (a) Section  1.1 of the Credit  Agreement  is hereby  amended by adding the
following definitions in the appropriate alphabetical sequence:


          "Buyer"  shall  mean  Histoire  d'Or  and  a  wholly-owned  subsidiary
thereof,  the buyers  under the SONAB Asset  Purchase  Agreement.

          "SONAB  Asset  Purchase  Agreement"  shall  mean  the  Asset  Purchase
Agreement dated as of December 23, 1999 between Sonab,  as seller,  and Histoire
d'Or  and a  wholly-owned  subsidiary  thereof,  as  buyers,  and the  ancillary
documents related thereto.

     (b) The  definition  of  "EBITDA"  contained  in Section  1.1 of the Credit
Agreement is hereby amended by adding to clause (ii) thereof the following: "(D)
the gross amount of the write-off associated with the sale of assets by Sonab to
Buyer, the liquidation of the balance of the net assets of Sonab and the closure
of the Sonab operation,  to a maximum of $27 million.";  and by adding to clause
(iii) thereof the words "and (D)" after the words "clause (C)".

     (c) The definition of "Fixed Charge  Coverage  Ratio"  contained in Section
1.1 of the Credit  Agreement  is hereby  amended  by adding to clause  (a)(i)(x)
thereof after the words "Tax  Allocation  Agreement" the following:  ", adjusted
upward to negate the tax benefit  resulting from the write-off  associated  with
the sale of assets by Sonab to Buyer,  the liquidation of the balance of the net
assets of Sonab and the closure of the Sonab operation.".

     (d)  Section  2.5(c)  of the  Credit  Agreement  is hereby  deleted  in its
entirety.

     (e) Section 7(b) of the Credit Agreement is hereby replaced in its entirety
with the following:


          "(b) From and after the Closing Date,  proceeds of Revolving  Advances
to the Company shall be used (i) for the working  capital and general  corporate
purposes  (including,  without  limitation,  for  the  purpose  of  opening  and
maintaining  not more than  twenty-two  factory  outlet  stores  operated by the
Company to the extent set forth in Section  9.1 and 9.24  hereof) of the Company
and its  Subsidiaries  to the extent such purposes are  permitted  hereunder and
(ii) to  repurchase  Senior  Notes to the extent such  purchases  are  permitted
hereunder."

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<PAGE>

     (f) Sections 7(d) and 7(e) of the Credit  Agreement  are hereby  deleted in
their entirety.

     (g) The last sentence of Section  8.1(p) of the Credit  Agreement is hereby
deleted in its entirety.

     (h) Section 8.24 of the Credit Agreement is hereby deleted in its entirety.

     (i) Section 8.25 of the Credit Agreement is hereby deleted in its entirety.

     (j) Sections  9.3(e)(ii) and (q) of the Credit Agreement are hereby deleted
in their entirety.

     (k) Section 9.9 of the Credit  Agreement is hereby amended by adding to the
end thereof the following sentence:  "In addition to the foregoing,  Sonab shall
be permitted to make  severance and incentive  payments to Bernard  Gelbfarb and
Olivier DeBost in connection with the termination of the Sonab operation.".

     (l) The  proviso  in the  last  sentence  of  Section  9.14  of the  Credit
Agreement is hereby  replaced in its  entirety  with the  following:  "provided,
however, that the sole business of Sonab shall be to provide transition services
to the Buyer prior to the winding up of Sonab's operations.".

     (m) Section 9.23 of the Credit Agreement is hereby deleted in its entirety.

     (n) Section 9.25 of the Credit Agreement is hereby deleted in its entirety.

     (o) Section 11.1(d) of the Credit  Agreement is hereby amended by adding to
the end thereof the following sentence: "The only business that Sonab engages in
is to  provide  transition  services  to the Buyer  prior to the  winding  up of
Sonab's operations.".

     4. Release of Security Interest.  The Lenders hereby authorize the Agent to
release its security  interest in the assets that are contemplated to be sold by
Sonab to Buyer pursuant to the Asset Purchase Agreement.

     5.  Representations  and  Warranties.  Each of the Parent  and the  Company
represents and warrants as follows (which  representations  and warranties shall
survive the execution and delivery of this Amendment):

     (a) Each of the Parent and the  Company has taken all  necessary  action to
authorize the execution, delivery and performance of this Amendment.

     (b) This  Amendment  has been duly executed and delivered by the Parent and
the Company and the  acknowledgement  attached hereto has been duly executed and
delivered by each Subsidiary. This Amendment and the Credit Agreement as amended
hereby constitute the legal,  valid and binding obligation of the Parent and the
Company,  enforceable  against them in accordance with their  respective  terms,
subject to applicable

                                       3
<PAGE>

bankruptcy,  reorganization,  insolvency,  moratorium and similar laws affecting
the enforcement of creditors' rights generally and by general equity principles.

     (c) No consent or approval of any person, firm,  corporation or entity, and
no consent,  license, approval or authorization of any governmental authority is
or will be required in connection  with the  execution,  delivery,  performance,
validity  or  enforcement  of this  Amendment,  other  than  any  such  consent,
approval,  license or authorization  which has been obtained and remains in full
force and effect or where the failure to obtain such consent,  approval, license
or authorization would not result in a Material Adverse Effect.

     (d) After  giving  effect to this  Amendment,  each of the  Company and the
Parent is in compliance  with all of the various  covenants and  agreements  set
forth in the Credit Agreement and each of the other Loan Documents.

     (e) After  giving  effect to this  Amendment,  no event has occurred and is
continuing which constitutes a Default or an Event of Default.

     (f) All  representations  and warranties  contained in the Credit Agreement
and each of the  other  Loan  Documents  are true and  correct  in all  material
respects as of the date hereof,  except to the extent that any representation or
warranty relates to a specified date, in which case such are true and correct in
all material respects as of the specific date to which such  representations and
warranties relate.

     6. Effective Date. The amendments to the Credit Agreement  contained herein
shall not become  effective (the "Effective  Date") until (i) this Amendment has
been duly  executed and  delivered  by the Company,  the Parent and the Majority
Lenders and (ii) the  acknowledgement  attached  hereto shall have been executed
and delivered by each of the Subsidiaries.

     7.  Expenses.  The Company  agrees to pay on demand all costs and expenses,
including  reasonable  attorneys' fees, of the Agent incurred in connection with
this Amendment.

     8. Continued Effectiveness.  The term "Agreement",  "hereof",  "herein" and
similar terms as used in the Credit Agreement,  and references in the other Loan
Documents to the Credit  Agreement,  shall mean and refer to, from and after the
Effective Date, the Credit  Agreement as amended by this Amendment.  Each of the
Company and the Parent hereby  agrees that all of the  covenants and  agreements
contained in the Credit Agreement and the Loan Documents are hereby ratified and
confirmed in all respects.

     9. Gold Consignment Agreement.  The Lenders hereby consent to the execution
and delivery by the Company of an amendment  to the Gold  Consignment  Agreement
consistent with the terms of this Amendment.

     10. Counterparts.  This Amendment may be executed in counterparts,  each of
which shall be an original, and all of which, taken together, shall constitute a
single  instrument.  Delivery of an executed  counterpart of a signature page to
this  Amendment

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<PAGE>

by telecopier shall be effective as delivery of a manually executed  counterpart
of this Amendment.

     11.  Governing Law. This  Amendment  shall be governed by, and construed in
accordance  with, the laws of the State of New York without giving effect to the
conflict of laws provisions thereof.

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<PAGE>

     IN WITNESS WHEREOF the parties hereto have caused this Amendment to be duly
executed by their respective officers as of the date first written above.


                                        FINLAY ENTERPRISES, INC.

                                        By: /s/ Bruce Zurlnick
                                            -----------------------------------
                                            Name:  Bruce Zurlnick
                                            Title: Senior Vice President and
                                            Chief Financial Officer


                                        FINLAY FINE JEWELRY CORPORATION
                                        By: /s/ Bruce Zurlnick
                                            -----------------------------------
                                            Name:  Bruce Zurlnick
                                            Title: Senior Vice President and
                                            Chief Financial Officer


                                        GENERAL ELECTRIC CAPITAL CORPORATION,
                                        Individually and as Agent

                                        By: /s/ James F. Hogan
                                            -----------------------------------
                                            Name:  James F. Hogan
                                            Title: Duly Authorized Signatory


                                        FLEET PRECIOUS METALS, INC.

                                        By: /s/ John M. Regan
                                            -----------------------------------
                                            Name:  John M. Regan
                                            Title: Vice President

                                        By: /s/ Stephen F. O'Sullivan
                                            -----------------------------------
                                            Name:  Stephen F. O'Sullivan
                                            Title: Vice President


                                        THE CHASE MANHATTAN BANK

                                        By: /s/Irene B. Spector
                                            -----------------------------------
                                            Name:    Irene B. Spector
                                            Title:   Vice President

<PAGE>

                                        GOLDMAN SACHS CREDIT PARTNERS L.P.


                                        By: /s/ Elizabeth Fischer
                                            -----------------------------------
                                            Name:  Elizabeth Fischer
                                            Title:    Authorized Signatory


                                        ABN AMRO BANK N.V.


                                        By: /s/ Jeffrey Sarfaty
                                            -----------------------------------
                                            Name:  Jeffrey Sarfaty
                                            Title: Vice President

                                        By: /s/ Anna Martin
                                            -----------------------------------
                                            Name:  Anna Martin
                                            Title: Senior Vice President


                                        BANK LEUMI

                                        By: /s/ David Selove
                                            -----------------------------------
                                            Name:  David Selove
                                            Title: Vice President


                                        By:  /s/ Jeff E. Pfeffer
                                            -----------------------------------
                                            Name:  Jeff E. Pfeffer
                                            Title: Senior Vice President


                                        TRANSAMERICA BUSINESS CREDIT
                                        CORPORATION

                                        By: /s/ Michael S. Burns
                                            -----------------------------------
                                            Name:  Michael S. Burns
                                            Title: Senior Vice President
<PAGE>


Each of the Guarantors, by signing below, confirms in favor of the Agent and the
Lenders that it consents to the terms and conditions of the foregoing  Amendment
No. 7 to the Amended and  Restated  Credit  Agreement  and agrees that it has no
defense,  offset,  claim,  counterclaim or recoupment with respect to any of its
obligations or liabilities  under its respective  Guaranty and that all terms of
such  Guaranty  shall  continue in full force and  effect,  subject to the terms
thereof.

FINLAY JEWELRY, INC.


By: /s/ Bruce Zurlnick
    -------------------------------------
    Name:  Bruce Zurlnick
    Title: Senior Vice President and Chief Financial Officer


SONAB HOLDINGS, INC.


By: /s/ Bruce Zurlnick
    -------------------------------------
    Name:  Bruce Zurlnick
    Title: Senior Vice President and Chief Financial Officer


SONAB INTERNATIONAL, INC.


By:  /s/ Bruce Zurlnick
    -------------------------------------
    Name:  Bruce Zurlnick
    Title: Senior Vice President and Chief Financial Officer


SOCIETE NOUVELLE D'ACHAT DE BIJOUTERIE - S.O.N.A.B.


By:  /s/ Bruce Zurlnick
    -------------------------------------
    Name:  Bruce Zurlnick
    Title: Attorney-in-fact


FINLAY MERCHANDISING & BUYING, INC.


By:  /s/ Bruce Zurlnick
    -------------------------------------
    Name:  Bruce Zurlnick
    Title: Senior Vice President and Chief Financial Officer