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                                                                   EXHIBIT 10.2


                      EXECUTIVE DEFERRED COMPENSATION PLAN
             OF PIMCO ADVISORS HOLDINGS L.P. AND PIMCO ADVISORS L.P.


               PIMCO Advisors L.P., a Delaware limited partnership ("Advisors"),
adopted the PIMCO Advisors L.P. Executive Deferred Compensation Plan (the
"Advisors Plan"), effective as of December 1, 1996, for the benefit of the
eligible employees of Advisors, certain of its subsidiaries, and certain of its
other subsidiaries which adopted the Advisors Plan.

               The Advisors Plan was amended and restated by Advisors effective
as of January 1, 1998, and as amended and restated was adopted by PIMCO Advisors
Holdings L.P., a Delaware limited partnership and a general partner of Advisors,
effective as of January 1, 1998.

               The Advisors Plan as so amended and restated (the "Plan") is a
nonqualified deferred compensation plan pursuant to which a portion of the
compensation otherwise payable to certain eligible employees will be mandatorily
deferred, and pursuant to which certain eligible employees may elect to defer
additional amounts of compensation. The Plan is unfunded and is maintained
primarily for the purpose of providing deferred compensation for a select group
of management or highly compensated employees, within the meaning of Sections
201(2), 301(a)(3) and 401(a)(1) of the Employee Retirement Income Security Act
of 1974, as amended.



                                    ARTICLE I
                                   DEFINITIONS

            Wherever the following capitalized terms are used in the Plan, they
shall have the meanings specified below.

               1998 Unit Incentive Plan shall mean the 1998 Unit Incentive Plan
of PIMCO Advisors Holdings L.P. and PIMCO Advisors L.P.

               Adjusted with reference to a dollar figure shall mean such dollar
figure as adjusted as of September 30 of each Plan Year to reflect any change in
the Consumer Price Index for All Urban Consumers as published by the Bureau of
Labor Statistics since January 1, 1998 or the last September 30 as of which such
dollar figure was so adjusted, whichever is later. Such adjusted dollar figure
shall be rounded up to the nearest one thousand dollars, but the unrounded
dollar figure shall be used in the next adjustment.

               Advisors shall mean PIMCO Advisors L.P., a Delaware limited
partnership.

               Advisors Management Board shall mean the Management Board of
Advisors or any successor board established by the general partners of Advisors.


               Advisors Units shall mean Class A units of limited partner
interest in Advisors.


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               Assets shall mean cash, Units, other securities or other assets.

               Base Salary of an Employee as of a specified date shall mean such
Employee's annual salary at the rate in effect on such date.

               Beneficiary of a Participant shall mean (i) a Person designated
by such Participant as a Beneficiary whose designation has not been revoked, and
(ii) a former spouse of such Participant who has been given rights as a
Beneficiary pursuant to a qualified domestic relations order issued in
accordance with Code Section 414(p); provided, however, that if at the time of
the Participant's death no Beneficiary has been designated whose designation has
not been revoked, the Persons deemed to be designated by the Participant as his
Beneficiaries shall be his surviving spouse, if any, or if his spouse does not
survive him, his surviving children in equal shares, or if no children survive
him, his heirs at law as determined under the laws of the state in which he
resided on the day he died governing succession to personal property; provided,
further, that if at the time of the Participant's death, a Beneficiary has been
designated whose designation has not been revoked, but such Beneficiary is a
person who does not survive until the Assets in the Participant's Deferral
Accounts are distributed pursuant to Section 9.2(c), such Beneficiary shall be
replaced as Beneficiary by his surviving spouse, if any, or if his spouse does
not survive him, his surviving children in equal shares, or if no children
survive him, his heirs at law as determined under the laws of the state in which
he resided on the day he died governing succession to personal property.

               Benefits shall mean Assets in a Deferral Account distributed to a
Participant or his Beneficiaries pursuant to Article IX.

               Bonus Compensation shall mean any Compensation other than Base
Salary.

               Business Entity shall mean a corporation, a business trust or
association, a real estate investment trust, a common-law trust, a limited
liability company or an unincorporated business, including a general or limited
partnership or registered limited liability partnership.

               Canadian Bonus Compensation of an Employee for a Plan Year shall
mean Bonus Compensation for services rendered by such Employee during such Plan
Year while such Employee was a resident of Canada.

               Canadian Compensation of an Employee for a Plan Year shall mean
Compensation for services rendered by such Employee during such Plan Year while
such Employee was a resident of Canada.

               Change of Control shall mean the acquisition (whether by way of
merger, consolidation, sale of assets, purchase of securities, or otherwise) by
a pre-existing Business Entity and its Affiliates (other than Holdings and its
Affiliates) of direct or indirect beneficial ownership of all or substantially
all of Advisors' assets or 51% or more of Advisors' units of general partner
interest or Advisors' units of partner interest, or the liquidation or
dissolution of Advisors.


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

               Committee shall mean the committee established pursuant to
Section 10.1.

               Compensation of an Employee for a Plan Year shall mean all
compensation, including salary, bonuses, payments under profit-sharing plans,
commissions and other forms of incentive compensation, for services rendered by
such Employee to Advisors or its Subsidiaries during such Plan Year, whenever
paid, including Deferred Compensation but excluding compensation attributable to
(i) signing or relocation bonuses, (ii) employee benefits, including principal
or interest forgiven on loans to such Employee, (iii) the exercise of options on
Units, the granting or vesting of, or the receipt of distributions on,
Restricted Units or Deferred Units, or the receipt of Unit payments or payments
in respect of Unit appreciation rights, pursuant to a Unit Incentive Plan, or
(iv) the distribution of Benefits under the Plan, including distributions from
such Employee's distribution subaccounts.

               Compensation Contribution Subaccount of a Participant for a Plan
Year shall mean the contribution subaccount of his Compensation Deferral Account
for such Plan Year.

               Compensation Deferral Account of a Participant shall mean his
individual account established in accordance with Section 5.1(a).

               Compensation Deferral Subaccounts of a Participant for a Plan
Year shall mean the basic deferral subaccount, excess deferral subaccount and
voluntary deferral subaccount of his Compensation Deferral Account for such Plan
Year.

               Current Employee shall mean an Employee who is, at the time of
reference, rendering services to Advisors or any of its Subsidiaries in the
status of an employee as that term is defined in Code Section 3121(d).

               Contribution Subaccount of a Participant for a Plan Year shall
mean his Compensation Contribution Subaccount or Unit Award Contribution
Subaccount for such Plan Year.

               Deferral Account of a Participant shall mean his Compensation
Deferral Account or his Unit Award Deferral Account.

               Deferral Schedule of a Participant for a Plan Year shall mean the
schedule of mandatory deferrals, and if applicable, voluntary deferrals, of
Compensation established by the Plan and such Participant for such Plan Year.

               Deferral Subaccounts of a Participant for a Plan Year shall mean
his Compensation Deferral Subaccounts and Unit Award Deferral Subaccount, if
any, for such Plan Year.



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               Deferred Compensation shall mean Compensation deferred by a
Participant pursuant to Article III.

               Deferred Units shall mean Units issued to Employees of Advisors
and its Subsidiaries when they vest pursuant to an award under a Unit Incentive
Plan.

               Disability of an Employee shall mean a physical, mental or
emotional condition which renders the Employee unable to perform the usual and
customary duties of his position with his Employer, as determined in accordance
with the employment rules and policies of his Employer.

               Discount Subaccount shall mean a subaccount of a Deferral Account
designated as a Discount Subaccount pursuant to Section 5.1(e) or 6.1(c).

               Disputed Activity shall have the meaning set forth in Section
8.4(d).

               Disputed Activity Notice shall have the meaning set forth in
Section 8.4(d).

               Eligible Employee with respect to a Plan Year shall mean any
Employee of a Participating Employer whose Estimated Compensation for such Plan
Year is greater than $250,000 (as Adjusted).

               Employee shall mean any person who renders services to Advisors
or any of its Subsidiaries in the status of an employee.

               Employer of a Participant, determined on any date, shall mean the
Person of which the Participant is an Employee.

               Equity Holdings of an Employee, determined on any date, shall
mean the aggregate Fair Market Value of all Units held directly by such Employee
or in which such Employee has a pecuniary interest (to the extent of such
interest), including Restricted Units, Deferred Units and Units held in his
Deferral Accounts, whether or not vested. Such Employee shall be deemed to have
a pecuniary interest in Units underlying options or Unit appreciation rights
awarded to him pursuant to a Unit Incentive Plan, whether or not vested, equal
to the dollar amount by which the Fair Market Value of such Units as of such
date exceeds the exercise price or base price.

               ERISA shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time.

               Estimated Bonus Compensation of an Employee for a Plan Year shall
mean the estimated amount of total Bonus Compensation which will be paid to such
Employee for services rendered by him to Advisors or any of its Subsidiaries
during such Plan Year, determined in accordance with the first of the following
rules which is applicable:



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                    (i) If the total Bonus Compensation for services rendered by
such Employee to Advisors or any of its Subsidiaries during the year preceding
such Plan Year (annualized if he was employed for less than the whole year) is
fixed at the time of such determination, such total Bonus Compensation shall be
such Employee's Estimated Bonus Compensation for such Plan Year.

                    (ii) If the total Bonus Compensation for services rendered
by such Employee to Advisors or any of its Subsidiaries during the year
preceding such preceding year (annualized if he was employed for less than the
whole year) is fixed at the time of such determination, such total Bonus
Compensation shall be such Employee's Estimated Bonus Compensation for such Plan
Year.

                    (iii) If not determined in accordance with the preceding
rules, the Estimated Bonus Compensation of such Employee for such Plan Year
shall be determined by the Committee.

               Estimated Compensation of an Employee for a Plan Year shall mean
(i) his Base Salary determined as of the first day of such Plan Year, or if he
becomes an Employee during such Plan Year, his Base Salary determined as of the
date he becomes an Employee, plus (ii) his Estimated Bonus Compensation for such
Plan Year.

               Fair Market Value of a Unit shall mean the fair market value of
such Unit as determined in good faith by the Committee.

               Former Employee shall mean a person who is not, at the time of
reference, rendering services to Advisors or any of its Subsidiaries in the
status of an employee.

               Holdings shall mean PIMCO Advisors Holdings L.P., a Delaware
limited partnership.

               Holdings Management Board shall mean the Management Board of
Holdings or any successor board established by the general partner of Holdings.

               Holdings Units shall mean units of limited partner interest in
Holdings.

               Indemnified Person shall have the meaning set forth in Section
10.4(b).

               Investment Management Firm shall mean any division or Subsidiary
of Advisors which is principally engaged in the investment advisory business.

               Investment Management Services shall mean any services which
involve: (i) the management, for a fee or other remuneration, of an investment
account or fund (or a portion thereof) or a group of investment accounts or
funds, or (ii) the giving of advice, for a fee or other remuneration, with
respect to the investment of specific assets or funds (or a specific portion
thereof) or any specific group of assets or funds; provided, however, that
Investment Management Services shall not include the giving of general
investment advice that is not related





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to an identifiable investment account or fund (or portion thereof) or group of
investment accounts or funds for which the advisor receives no fee or other
remuneration.

               Managed Funds shall mean, as of any date, those funds or
investments with respect to which any Investment Management Firm or any
Subsidiary of any Investment Management Firm is performing any Investment
Management Services.

               Management Boards shall mean the Advisors Management Board and
the Holdings Management Board.

               Managing Director shall mean a person who is employed by an
Investment Management Firm in the capacity of, and holds the title of, Managing
Director.

               Money Market Fund shall mean an open end mutual fund selected by
the Trustee which invests in short-term investment grade interest-bearing
securities and endeavors to maintain a share value of $1.00.

               Non-Canadian Compensation of an Employee for a Plan Year shall
mean (i) if he is not a resident of Canada at any time during such Plan Year,
his Compensation for such Plan Year, or (ii) if he is a resident of Canada at
any time during such Plan Year, his Compensation for such Plan Year which is not
Canadian Compensation.

               Participant shall mean a person who is a Mandatory Participant or
a Voluntary Participant during the current Plan Year, or who was a Mandatory
Participant or a Voluntary Participant during a prior Plan Year.

               Participating Employer shall mean Advisors, any Subsidiary of
Advisors which is not an Investment Management Firm, any Subsidiary of Advisors
which is an Investment Management Firm and which adopts the Plan in accordance
with Section 11.4(a), and any successor Business Entity which adopts the Plan
pursuant to Section 11.4(b).

               Partnership shall mean Advisors or Holdings.

               Person shall mean an individual, Business Entity, trust, estate,
custodian, nominee or any other entity in its own or any representative
capacity.

               Plan shall mean the Executive Deferred Compensation Plan of PIMCO
Advisors Holdings L.P. and PIMCO Advisors L.P.

               Plan Year shall mean the calendar year.

               Prohibited Competition Activity shall have the meaning set forth
in Section 8.4(a).

               Prohibited Investment Management Services shall mean any
Investment Management Services which compete with the Investment Management
Services of any Investment Management Firm or any Subsidiary of any Investment
Management Firm.




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               Qualified Participant shall mean a Participant who is a partner
of Advisors or who is qualified to be a partner of Advisors under the Advisors
Partnership Agreement.

               Rabbi Trust shall mean that certain trust dated as of December 1,
1996 established by Advisors and the other Participating Employers as of that
date for purposes of receiving payments of deferred Compensation, investing such
payments pursuant to Article VII, and distributing Benefits to Participants and
Beneficiaries pursuant to Article IX.

               Restricted Unit Agreement shall mean an agreement governing the
vesting and forfeiture of Restricted Units.

               Restricted Units shall mean Units issued to Employees of Advisors
and its Subsidiaries pursuant to a Unit Incentive Plan which are subject to
forfeiture until they vest..

               Retirement of an Employee shall mean his retirement on or after
his fifty-fifth birthday in accordance with the employment rules and policies
established by his Employer.

               Rules of the Plan shall mean the rules adopted by the Committee
pursuant to Section 10.2(a)(i), as the same may be amended or revoked from time
to time.

               Subsidiary of a Person shall mean a subsidiary of such Person
within the meaning of Regulation S-X under the Securities Act of 1933, as
amended.

               Termination of Employment of a Participant shall occur when such
Participant ceases to be employed by Advisors or any of its Subsidiaries for any
reason except Retirement, Disability or death; provided, however, that a
vacation, sick leave or leave of absence taken by a Participant in accordance
with the employment rules and policies established by his Employer shall not
constitute a Termination of Employment; provided, further, that failure of a
Participant to return to work upon expiration of any vacation, sick leave or
leave of absence shall constitute a Termination of Employment on such date as is
determined by the employment rules and policies of his Employer.

               Trustee shall mean the trustee under the Rabbi Trust.

               Unforeseen Emergency shall have the meaning set forth in Section
8.2(c).

               Unit Award shall have the meaning set forth in Section 4.1.

               Unit Award Compensation shall have the meaning set forth in
Section 4.2.

               Unit Award Contribution Subaccount of a Participant for a Plan
Year shall mean the contribution subaccount of his Unit Award Deferral Account
for such Plan Year.

               Unit Award Deferral Account of a Participant shall mean his
individual account established in accordance with Section 6.1(a).




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               Unit Award Deferral Subaccount of a Participant for a Plan Year
shall mean the deferral subaccount of his Unit Award Deferral Account for such
Plan Year.

               Unit Incentive Plan shall mean the 1998 Unit Incentive Plan or
any similar plan for the granting of options on Units, restricted Units, Unit
payments, deferred Units, Unit appreciation rights and similar awards to
Employees of Advisors and its Subsidiaries.

               Units shall mean units of partner interest in a Partnership.

               Vest, when used with reference to a Participant's Deferral
Accounts and subaccounts, shall mean becoming nonforfeitable except as provided
in Section 8.3.



                                   ARTICLE II
                     ELIGIBILITY FOR COMPENSATION DEFERRALS

            Section 2.1 Mandatory Participation

               (a) An Eligible Employee whose Estimated Compensation for a Plan
Year is less than $1,000,000 (as Adjusted) and whose Equity Holdings determined
as of the first day of such Plan Year, or if he becomes an Employee during such
Plan Year, his Equity Holdings determined as of the date he becomes an Employee,
are less than his Estimated Compensation, shall become a Mandatory Participant
as of the first day of such Plan Year, or if later, the date on which he becomes
an Employee, and shall remain a Mandatory Participant until the last day of such
Plan Year.

               (b) An Eligible Employee whose Estimated Compensation for a Plan
Year is equal to or greater than $1,000,000 (as Adjusted) and whose Equity
Holdings determined as of the first day of such Plan Year, or if he becomes an
Employee during such Plan Year, his Equity Holdings determined as of the date he
becomes an Employee, are less than twice his Estimated Compensation, shall
become a Mandatory Participant as of the first day of such Plan Year, or if
later, the date on which he becomes an Employee, and shall remain a Mandatory
Participant until the last day of such Plan Year.

               (c) A Participating Employer may, when it adopts the Plan and
thereafter during the third quarter of any Plan Year, specify that any of its
Employees who is elected as a Managing Director shall be a Mandatory Participant
for the Plan Year in which he is elected and such number of ensuing Plan Years
as shall be specified by such Participating Employer.

            Section 2.2 Voluntary Participation

               An Eligible Employee who is not a Mandatory Participant for a
Plan Year may elect to participate in the Plan as a Voluntary Participant as of
the first day of such Plan Year, or if later, the date on which he becomes an
Employee, and shall remain a Voluntary Participant until the last day of such
Plan Year.





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                                   ARTICLE III
                              COMPENSATION DEFERRAL

            Section 3.1 Mandatory Deferral

               (a) Each Mandatory Participant for a Plan Year shall defer the
following amount of his Compensation for such Plan Year:

                    (i) 10% of his Compensation between $250,000 (as Adjusted)
and $500,000 (as Adjusted); plus

                    (ii) 30% of his Compensation, if any, between $500,000 (as
Adjusted) and $1,000,000 (as Adjusted); plus

                    (iii) 30% of his Compensation, if any, in excess of
$1,000,000 (as Adjusted).

               (b) A Participating Employer may, when it adopts the Plan and
thereafter during the third quarter of any Plan Year, specify percentages and
amounts in excess of those set forth above, which shall be applicable to
succeeding Plan Years until changed; provided, however, that mandatory deferral
of Compensation in excess of $1,000,000 (as Adjusted) may not exceed 50%, and
mandatory deferral of total Compensation may not exceed 40%.

               (c) No amounts shall be deferred unless the total amount deferred
exceeds $1,000.

            Section 3.2 Voluntary Deferral

               (a) Each Mandatory Participant for a Plan Year may elect to defer
a specified amount of his Compensation for such Plan Year exceeding the amount
deferred pursuant to Section 3.1, and each Voluntary Participant for a Plan Year
may elect to defer a specified amount of his Compensation for such Plan Year.

               (b) The total amount of Compensation for a Plan Year deferred by
a Participant pursuant to Section 3.1 and this Section 3.2 shall not exceed the
total amount of his Compensation for such Plan Year less the amount determined
as of the first day of such Plan Year in accordance with Code Section
401(a)(17).

            Section 3.3 Limit on Deferral of Canadian Compensation

               The amount of a Participant's Canadian Compensation for a Plan
Year that may be deferred pursuant to Sections 3.1 and 3.2 shall not exceed such
Participant's Canadian Bonus Compensation for such Plan Year.




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            Section 3.4 Compensation Deferral Elections

               (a) No later than two weeks after the Plan is adopted by a
Participating Employer, the Committee shall provide each Employee of such
Participating Employer who may be an Eligible Employee for the ensuing Plan Year
with a Compensation deferral form for such Plan Year on which such Employee
shall provide the information set forth in Section 3.5, including any election
by such Employee, if not a Mandatory Participant, to participate in the Plan as
a Voluntary Participant. Each such Employee shall complete and sign the
Compensation deferral form and return it to the Committee no later than four
weeks after the Plan is adopted by such Participating Employer.

               (b) In the fourth quarter of each Plan Year following the
adoption of the Plan by a Participating Employer, the Committee shall provide
each Employee of such Participating Employer who may be an Eligible Employee for
the ensuing Plan Year with a Compensation deferral form for such Plan Year on
which such Employee shall provide the information set forth in Section 3.5,
including any election by such Employee, if not a Mandatory Participant, to
participate in the Plan as a Voluntary Participant. Each such Employee shall
complete and sign the Compensation deferral form and return it to the Committee
no later than the last day of such quarter.

               (c) No later than two weeks after an Employee is first employed
by a Participating Employer, if such Employee may be an Eligible Employee for
the current Plan Year, the Committee shall provide such Employee with a
Compensation deferral form for such Plan Year on which such Employee shall
provide the information set forth in Section 3.5, including any election by such
Employee, if not a Mandatory Participant, to participate in the Plan as a
Voluntary Participant. Such Employee shall complete and sign the Compensation
deferral form and return it to the Committee no later than four weeks following
the date on which such Eligible Employee is first employed by such Participating
Employer.

            Section 3.5 Contents of Compensation Deferral Form

               Each Employee shall set forth on his Compensation deferral form
for a Plan Year

                    (i) his consent that he and his Beneficiaries, his and their
successors in interest and assigns and all Persons claiming under him or them
shall be bound by the statements contained therein and by the provisions of the
Plan and the Rules of the Plan as they then exist, and as they may be amended
from time to time;

                    (ii) the Plan Year to which the form applies;

                    (iii) if applicable, his election to participate in the Plan
as a Voluntary Participant;

                    (iv) if applicable, the amount of his Compensation for such
Plan Year that he elects to defer pursuant to Section 3.2;




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                    (v) the period during which his deferred Compensation for
such Plan Year is to be deferred pursuant to Section 8.2(a);

                    (vi) the method of distribution of Benefits from his
Compensation Deferral Subaccounts and Compensation Contribution Subaccount, if
any, established for such Plan Year;

                    (vii) whether income from the Assets held in his
Compensation Deferral Subaccounts and Compensation Contribution Subaccount, if
any, for such Plan Year shall be distributed to him, and if so, when such
distributions should commence; and

                    (viii) such other information as may be required for the
administration of the Plan.

            Section 3.6 Deferral Procedures

               The amount of Compensation for a Plan Year deferred by a
Participant shall be determined at the time of each payment of his Bonus
Compensation for such Plan Year, and shall be withheld from such payment, as
follows:

                    (i) If the total amount of such Participant's Bonus
Compensation for such Plan Year is known at the time of the first payment of his
Bonus Compensation for such Plan Year, such total amount shall be added to his
Base Salary for such Plan Year, and his Deferral Schedule for such Plan Year
shall be applied to such amount to produce the total amount to be deferred. If
his Bonus Compensation is paid in one installment, the total amount to be
deferred shall be withheld from such installment. If his Bonus Compensation is
paid in more than one installment, a proportionate amount of the total amount to
be deferred shall be withheld from each installment.

                    (ii) If the total amount of such Participant's Bonus
Compensation for such Plan Year is not known at the time of the first payment of
his Bonus Compensation for such Plan Year, then at the time of each payment of
Bonus Compensation, his total Bonus Compensation for such Plan Year through the
date of such payment shall be added to his Base Salary for such Plan Year, and
his Deferral Schedule for such Plan Year shall be applied to such amount to
produce the total amount to be deferred. The total amount to be deferred less
the total amount already deferred for such Plan Year shall be withheld from such
payment.

Examples of typical deferral calculations are attached to this Plan as Schedule
1.

            Section 3.7 Payments to Trustee

               (a) Each Participating Employer shall pay to the Trustee the
Compensation deferred by Participants who are Employees of such Participating
Employer, at the times and in the amounts such Compensation would have been paid
to such Participants by such Participating Employer if it had not been deferred.




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               (b) Upon receipt by the Trustee of a payment made by a
Participating Employer pursuant to Section 3.7(a) of Compensation for a Plan
Year deferred by a Participant, the Trustee shall allocate such payment to the
Participant's Compensation Deferral Subaccounts for such Plan Year.

            Section 3.8 Discontinuance of Deferral

               A Participant may request a reduction or discontinuance of the
deferral of his Compensation for a Plan Year pursuant to Section 3.2 on a form
specified by the Committee. The reduction or discontinuance shall apply only to
the portion of such Participant's Compensation for such Plan Year that has not
yet been earned.


                                   ARTICLE IV
                              UNIT AWARD DEFERRAL

            Section 4.1 Eligibility for Unit Award Deferral

               An Eligible Employee who receives an award of Restricted Units
under a Unit Incentive Plan ( a "Unit Award") and who is not a Participant for
the Plan Year in which he receives such Unit Award may elect to participate in
the Plan as a Voluntary Participant as of the date on which he receives such
Unit Award, and shall remain a Voluntary Participant until the last day of such
Plan Year.

            Section 4.2 Voluntary Deferral

               An Employee who receives a Unit Award during a Plan Year for
which he is a Mandatory Participant or Voluntary Participant may elect to defer
compensation recognized upon vesting of such Unit Award ("Unit Award
Compensation").

            Section 4.3 Unit Award Deferral Elections

               No later than two weeks after an Eligible Employee receives a
Unit Award, the Committee shall provide such Employee with a Unit Award deferral
form for the current Plan Year on which such Employee may provide the
information set forth in Section 4.4, including an election by such Employee, if
not a Mandatory Participant, to participate in the Plan as a Voluntary
Participant. If such Employee wishes to defer Unit Award Compensation with
respect to such Unit Award, he shall complete and sign the Unit Award deferral
form and return it to the Committee no later than four weeks following the date
that he receives the Unit Award.

            Section 4.4 Contents of Unit Award Deferral Form

               Each Employee shall set forth on his Unit Award deferral form for
a Plan Year:

                    (i) his consent that he and his Beneficiaries, his and their
successors in interest and assigns and all Persons claiming under him or them
shall be bound by the statements





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contained therein and by the provisions of the Plan and the Rules of the Plan as
they then exist, and as they may be amended from time to time;

                    (ii) the Plan Year to which the form applies;

                    (iii) if applicable, his election to participate in the Plan
as a Voluntary Participant;

                    (iv) the number of Units underlying his Unit Award for such
Plan Year for which he elects to defer Unit Award Compensation;

                    (v) the period for which his deferred Unit Award
Compensation is to be deferred pursuant to Section 8.2(b);

                    (vi) the method of distribution of Benefits from his Unit
Award Deferral Subaccount and Unit Award Contribution Subaccount, if any, for
such Plan Year;

                    (vii) whether income from the Assets held in his Unit Award
Deferral Subaccount and Unit Award Contribution Subaccount, if any, established
for such Plan Year shall be distributed to him, and if so, when such
distributions should commence; and

                    (viii) such other information as may be required for the
administration of the Plan.

            Section 4.5 Delivery of Units to Trustee

               (a) The issuer of Restricted Units as to which a Participant has
elected to defer Unit Award Compensation shall issue and deliver such Units to
the Trustee.

               (b) Upon receipt by the Trustee of Restricted Units as to which a
Participant has elected to defer Unit Award Compensation, the Trustee shall
allocate such Units to the Participant's Unit Award Deferral Subaccount for the
Plan Year in which the Participant received the Unit Award.

                                    ARTICLE V
                         COMPENSATION DEFERRAL ACCOUNTS

            Section 5.1 Compensation Deferral Accounts

               (a) The Trustee shall establish and thereafter maintain for each
Participant who defers Compensation a Compensation Deferral Account, which shall
consist of the subaccounts provided for in this Section 5.1.

               (b) If a Participant is a Mandatory Participant for a Plan Year,
the Trustee shall establish and thereafter maintain a basic deferral subaccount
of such Participant's





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Compensation Deferral Account for such Plan Year. Such basic deferral subaccount
shall be increased by any payments received by the Trustee for Compensation
deferred by such Participant for such Plan Year pursuant to Sections 3.1(a)(i)
and (ii), and by any income realized with respect to Assets held in such
subaccount (unless such income is credited to a corresponding distribution
subaccount), and shall be decreased by any distributions of Benefits from such
subaccount, and by any losses realized with respect to Assets held in such
subaccount (unless such losses are debited to a corresponding distribution
subaccount).

               (c) If a Participant is a Mandatory Participant for a Plan Year
and his Compensation for such Plan Year is equal to or greater than $1,000,000
(as Adjusted), the Trustee shall establish and thereafter maintain an excess
deferral subaccount of such Participant's Compensation Deferral Account for such
Plan Year. Such excess deferral subaccount shall be increased by any payments
received by the Trustee for Compensation deferred by such Participant for such
Plan Year pursuant to Section 3.1(a)(iii), and by any income realized with
respect to Assets held in such subaccount (unless such income is credited to a
corresponding distribution subaccount), and shall be decreased by any
distributions of Benefits from such subaccount, and by any losses realized with
respect to Assets held in such subaccount (unless such losses are debited to a
corresponding distribution subaccount).

               (d) If a Participant elects to defer a specified amount of his
Compensation for a Plan Year pursuant to Section 3.2, the Trustee shall
establish and thereafter maintain a voluntary deferral subaccount of such
Participant's Compensation Deferral Account for such Plan Year. Such voluntary
deferral subaccount shall be increased by any payments received by the Trustee
for Compensation deferred by such Participant for such Plan Year pursuant to
Section 3.2, and by any income realized with respect to Assets held in such
subaccount (unless such income is credited to a corresponding distribution
subaccount), and shall be decreased by any distributions of Benefits from such
subaccount, and by any losses realized with respect to Assets held in such
subaccount (unless such losses are debited to a corresponding distribution
subaccount).

               (e) If (i) a Participant is a Mandatory Participant for a Plan
Year, or (ii) a Participant's Equity Holdings determined as of the first day of
a Plan Year, or if he becomes an Employee during such Plan Year, his Equity
Holdings determined as of the date he becomes an Employee, are less than four
times his Estimated Compensation, such Participant's Compensation Deferral
Subaccounts for such Plan Year shall be designated as Discount Subaccounts, and
the Trustee shall establish and thereafter maintain a contribution subaccount of
such Participant's Compensation Deferral Account for such Plan Year. Such
contribution subaccount shall be increased by any allocation of Advisors Units
to such subaccount pursuant to Section 7.2, and by any income realized with
respect to Assets held in such subaccount (unless such income is credited to a
corresponding distribution subaccount), and shall be decreased by any
distributions of Benefits from such subaccount, and by any losses realized with
respect to Assets held in such subaccount (unless such losses are debited to a
corresponding distribution subaccount).

               (f) If a Participant elects, effective at a specified time, to be
paid the income realized with respect to the Assets held in his Compensation
Deferral Subaccounts and





                                       14
<PAGE>   15

Compensation Contribution Subaccount, if any, established for a Plan Year, the
Trustee shall establish as of such effective time and thereafter maintain a
distribution subaccount of such Participant's Compensation Deferral Account for
such Plan Year; provided, however, that a Participant may not elect to be paid
the income realized with respect to Assets held in a Compensation Contribution
Subaccount established for a Plan Year until such subaccount has Vested in
accordance with Section 8.1(a). Such distribution subaccount shall be increased
by any income realized with respect to the Assets held in such Compensation
Deferral Subaccounts and Compensation Contribution Subaccount, and by any income
realized with respect to Assets held in such distribution subaccount, and shall
be decreased by any distribution of Benefits from such distribution subaccount,
by any losses realized with respect to Assets held in such Compensation Deferral
Subaccounts and Compensation Contribution Subaccount, and by any losses realized
with respect to Assets held in such distribution subaccount.

               (g) If a Participant is a resident of Canada at any time during a
Plan Year, his Compensation Deferral Subaccounts and Compensation Contribution
Subaccount, if any, established for such Plan Year shall be divided between
Canadian subaccounts and Non-Canadian subaccounts. His deferred Canadian
Compensation for such Plan Year shall be allocated to his Canadian Compensation
Deferral Subaccounts established for such Plan Year, and his deferred
Non-Canadian Compensation for such Plan Year, if any, shall be allocated to his
Non-Canadian Compensation Deferral Subaccounts established for such Plan Year.
Amounts allocated to his Compensation Contribution Subaccount for such Plan Year
pursuant to Section 7.2 shall be further allocated to his Canadian Compensation
Contribution Subaccount and Non-Canadian Compensation Contribution Subaccount
for such Plan Year, in proportion to the cash in each immediately prior to the
purchase of Advisors Units as provided in Section 7.2.

               (h) A Participant's Compensation Deferral Account shall not be
liable for his debts, contracts or engagements, or the debts, contracts or
engagement of his Beneficiaries or successors in interest, or be taken in
execution by levy, attachment or garnishment or by any other legal or equitable
proceeding, nor shall the Participant or his Beneficiaries or successors in
interest have any rights to alienate, anticipate, commute, pledge, encumber or
assign any Benefits or other distributions under this Plan in any manner
whatsoever, except for the Participant's right to designate a Beneficiary or
Beneficiaries pursuant to Section 9.1.

               (i) As provided in Section 11.3, the rights of a Participant and
his Beneficiaries in the Assets in his Compensation Deferral Account shall be no
greater than the rights of an unsecured general creditor of his Employer.



                                   ARTICLE VI
                          UNIT AWARD DEFERRAL ACCOUNTS

            Section 6.1 Unit Award Deferral Accounts

               (a) The Trustee shall establish and thereafter maintain for each
Participant who defers Unit Award Compensation a Unit Award Deferral Account,
which shall consist of the subaccounts provided for in this Section 6.1.




                                       15

<PAGE>   16


               (b) If a Participant elects to defer Unit Award Compensation with
respect to a Unit Award received by him during a Plan Year, the Trustee shall
establish and thereafter maintain a deferral subaccount of such Participant's
Unit Award Deferral Account for such Plan Year. Such deferral subaccount shall
be divided into tranches corresponding to the dates on which the restrictions on
the Restricted Units in such Unit Award expire under the Deferred Restricted
Unit Agreement covering such Unit Award. Each tranche in such deferral
subaccount shall be increased by any Units received by the Trustee with respect
to such tranche pursuant to Section 4.5, and by any income realized with respect
to Assets held in such tranche (unless such income is credited to a
corresponding distribution subaccount), and shall be decreased by any
distributions of Benefits from such tranche, and by any losses realized with
respect to Assets held in such tranche (unless such losses are debited to a
corresponding distribution subaccount).

               (c) If a Participant elects to defer Unit Award Compensation with
respect to a Unit Award received by him during a Plan Year and (i) such
Participant is a Mandatory Participant for such Plan Year, or (ii) such
Participant's Equity Holdings determined as of the first day of such Plan Year,
or if he becomes an Employee during such Plan Year, his Equity Holdings
determined as of the date he becomes an Employee, are less than four times his
Estimated Compensation, such Participant's Unit Award Deferral Subaccount for
such Plan Year shall be designated as a Discount Subaccount, and the Trustee
shall establish and thereafter maintain a contribution subaccount of such
Participant's Unit Award Deferral Account for such Plan Year. Such contribution
subaccount shall be divided into tranches corresponding to the dates on which
the restrictions on the Restricted Units in such Unit Award expire under the
Deferred Restricted Unit Agreement covering such Unit Award. Each tranche in
such contribution subaccount shall be increased by any allocation of Advisors
Units to such tranche pursuant to Section 7.2, and by any income realized with
respect to Assets held in such tranche (unless such income is credited to a
corresponding distribution subaccount), and shall be decreased by any
distributions of Benefits from such tranche, and by any losses realized with
respect to Assets held in such tranche (unless such losses are debited to a
corresponding distribution subaccount).

               (d) If a Participant elects, effective at a specified time, to be
paid the income realized with respect to the Assets held in his Unit Award
Deferral Subaccount and Unit Award Contribution Subaccount, if any, established
for a Plan Year, the Trustee shall establish as of such effective time and
thereafter maintain a distribution subaccount of such Participant's Unit Award
Deferral Account for such Plan Year; provided, however, that a Participant may
not elect to be paid the income realized with respect to (i) Units held in such
Unit Award Deferral Subaccount until such Units have Vested in accordance with
Section 8.1(b), or (ii) Assets held in such Unit Award Contribution Subaccount
until such subaccount has Vested in accordance with Section 8.1(a). Such
distribution subaccount shall be increased by any income realized with respect
to the Assets held in such Unit Award Deferral Subaccount and Unit Award
Compensation Contribution Subaccount, and by any income realized with respect to
Assets held in such distribution subaccount, and shall be decreased by any
distribution of Benefits from such distribution subaccount, by any losses
realized with respect to Assets held in such Unit Award Deferral Subaccount and
Unit Award Contribution Subaccount, and by any losses realized with respect to
Assets held in such distribution subaccount.




                                       16
<PAGE>   17

               (e) A Participant's Unit Award Deferral Account shall be not be
liable for his debts, contracts or engagements, or the debts, contracts or
engagements of his Beneficiaries or successors in interest, or be taken in
execution by levy, attachment or garnishment or by any other legal or equitable
proceeding, nor shall the Participant or his Beneficiaries or successors in
interest have any rights to alienate, anticipate, commute, pledge, encumber or
assign any Benefits or other distributions under this Plan in any manner
whatsoever, except for the Participant's right to designate a Beneficiary or
Beneficiaries pursuant to Section 9.1.

               (f) As provided in Section 11.3, the rights of a Participant and
his Beneficiaries in the Assets in his Unit Award Deferral Account shall be no
greater than the rights of an unsecured general creditor of his Employer.



                                   ARTICLE VII
                              INVESTMENT OF FUNDS

            Section 7.1 Investment in Money Market Funds

            Cash received by the Trustee with respect to a subaccount of a
Participant's Deferral Accounts shall be invested in Money Market Funds until
invested in Advisors Units or distributed.

            Section 7.2 Investment in Advisors Units

               (a) On the fifth trading day of each calendar month, the Trustee
shall sell any Assets other than Advisors Units held in Deferral Subaccounts and
Contribution Subaccounts, and shall use all of the cash held in such subaccounts
after receipt of the proceeds of sale to purchase Advisors Units from Advisors.
The purchase price of the Advisors Units shall be (i) 85% of Fair Market Value
for Advisors Units purchased with cash from (i) Discount Subaccounts and
Contribution Subaccounts of Current Employees, and (ii) 100% of Fair Market
Value for Advisors Units purchased with cash from other Deferral Subaccounts and
Contribution Subaccounts.

               (b) The Trustee shall aggregate all of the cash in (i) Discount
Subaccounts and Contribution Subaccounts of Current Employees and (ii) other
Deferral Subaccounts and Contribution Subaccounts, and shall purchase the
maximum possible number of whole Advisors Units with each such aggregate of
cash. Any remaining cash shall be allocated back to such subaccounts in
proportion to the cash in each such subaccount immediately prior to the
purchase.

               (c) The Trustee shall allocate 85% of the Advisors Units
purchased at 85% of Fair Market Value to the Discount Subaccounts and
Contribution Subaccounts of Current Employees, in proportion to the cash in each
such subaccount immediately prior to the purchase.

               (d) The Trustee shall allocate 15% of the Advisors Units
purchased at 85% of Fair Market Value to the Contribution Subaccounts of each
Current Employee in proportion to





                                       17
<PAGE>   18

the Advisors Units allocated pursuant to Section 7.2(c) to such Participant's
Discount Subaccounts and Contribution Subaccounts for the same Plan Year.

               (e) The Trustee shall allocate 100% of the Advisors Units
purchased at 100% of Fair Market Value to (i) Deferral Subaccounts of Current
Employees not designated as Discount Subaccounts and (ii) Deferral Subaccounts
and Contribution Subaccounts of Former Employees, in proportion to the cash in
each such subaccount immediately prior to the purchase.

               (f) The Trustee shall allocate fractional Units as necessary to
subaccounts.

            Section 7.3 Quarterly Distributions

               Not later than thirty days after each payment of a distribution
on the Advisors Units, the Trustee shall sell any Assets held in the
distribution subaccounts of the Deferral Accounts, and shall distribute all of
the cash held in a Participant's distribution subaccounts to him.



                                  ARTICLE VIII
                          VESTING OF ACCOUNTS; DEFERRAL
                               PERIODS; FORFEITURE

            Section 8.1 Vesting of Accounts

               (a) A Participant's interest in a Compensation Deferral
Subaccount shall Vest immediately upon deferral. A Participant's interest in a
Compensation Contribution Subaccount shall vest on the earlier of (i) the first
day of the sixth year following the Plan Year in which such subaccount was
established (the last day of the third year following such Plan Year for a
Canadian Compensation Contribution Subaccount), or (ii) his Retirement,
Disability or death, or (iii) the occurrence of a Change of Control. In the
event of a Participant's Termination of Employment prior to the date on which a
Compensation Contribution Subaccount Vests, all of the Assets in such subaccount
shall be forfeited and returned by the Trustee to Advisors.

               (b) A Participant's interest in each tranche of a Unit Award
Deferral Subaccount shall Vest upon expiration of the restrictions on the Units
in such tranche. A Participant's interest in each tranche of a Unit Award
Contribution Subaccount shall Vest on the later of (i) the date on which the
Units in the corresponding Unit Award Deferral Subaccount Vest, or (ii) the
earlier of (A) the first day of the sixth year following the Plan Year in which
such tranche was established, or (B) his Retirement, Disability or death, or (C)
the occurrence of a Change of Control. In the event of the cancellation or
expiration of the Deferred Restricted Unit Agreement covering Units allocated to
a tranche prior to the date on which such Units Vest, all of the Assets in such
tranche and the corresponding tranche of the Unit Award Contribution Subaccount
shall be forfeited and returned by the Trustee to Advisors, and in the event of
a Participant's Termination of Employment prior to the date on which a tranche
of a Unit Award Contribution Subaccount Vests, all of the Assets in such tranche
shall be forfeited and returned by the Trustee to Advisors.




                                       18
<PAGE>   19

            Section 8.2 Compensation Deferral Periods

               (a) Non-Canadian Compensation for a Plan Year shall be deferred
until five years following such Plan Year. A Participant may elect to defer such
Compensation for such minimum period or for any whole number of years extending
beyond such minimum period, or until the Participant's Retirement or Disability
or for any whole number of years after the Participant's Retirement or
Disability, or until the Participant's death. Canadian Compensation for a Plan
Year shall be deferred for three years following such Plan Year.

               (b) Unit Award Compensation deferred with respect to a Unit Award
received during a Plan Year shall be deferred until the later of (i) five years
following such Plan Year or (ii) one full year after expiration of all
restrictions on the Units covered by such Unit Award. A Participant may elect to
defer such Unit Award Compensation for such minimum period or for any whole
number of years extending beyond such minimum period, or until the Participant's
Retirement or Disability or for any whole number of years after the
Participant's Retirement or Disability, or until the Participant's death.

               (c) If the Committee determines that a Participant has suffered a
severe financial hardship resulting from a sudden and unexpected illness or
accident of the Participant or of a dependent of the Participant, the loss of
the Participant's property due to casualty, or other similar extraordinary and
unforeseeable circumstances arising as a result of events beyond the control of
the Participant (each, an "Unforeseen Emergency"), the Committee may, upon the
Participant's request, but only to the extent required to mitigate the
Participant's hardship, (i) reduce the deferral periods applicable to one or
more Plan Years for which Compensation was deferred by the Participant or (ii)
permit an early transfer of Assets from the Participant's Deferral Account to
the Participant. Reduction of a deferral period or early transfer from a
Participant's Deferral Account may be authorized by the Committee only to the
extent that the Participant's hardship cannot be relieved (i) through
reimbursement or compensation by insurance or otherwise, (ii) by liquidation of
the Participant's assets, to the extent that liquidation of such assets would
not itself cause severe financial hardship, or (iii) by cessation of deferrals
under the Plan. Examples of what are not considered to be Unforeseen Emergencies
include the desire to send a Participant's child to college or the desire to
purchase a home.

            Section 8.3 Forfeiture By Reason of Prohibited Competition Activity

               If so specified by a Participating Employer when it adopts the
Plan, in the event that an Employee of such Employer who was a Managing Director
at the time of his Termination of Employment, Retirement or Disability engages
in any Prohibited Competition Activity within five years after the Plan Year in
which an excess deferral subaccount of his Compensation Deferral Account was
established for him (three years in the case of a Canadian excess deferral
subaccount), all Assets in such subaccount shall be forfeited and returned by
the Trustee to the Managing Director's Employer.




                                       19
<PAGE>   20

            Section 8.4 Prohibited Competition Activity

               (a) "Prohibited Competition Activity" means any of the following
activities:

                    (i) Directly or indirectly (A) diverting or taking away any
Managed Funds, or (B) soliciting any Person for the purpose of diverting or
taking away any Managed Funds.

                    (ii) Directly or indirectly performing any Prohibited
Investment Management Services. In the event that a former Managing Director
desires to perform Investment Management Services which he believes will not
constitute Prohibited Investment Management Services, he may, prior to his
commencing the performance of such Investment Management Services, request
Advisors to make a determination as to whether the proposed Investment
Management Services constitute Prohibited Investment Management Services. Any
such request shall be made in writing and shall contain all information
concerning the proposed Investment Management Services which the former Managing
Director reasonably believes to be material to the determination to be made. In
addition, the former Managing Director shall submit such other information as
may be reasonably requested by Advisors.

                    (iii) Directly or indirectly soliciting or encouraging any
Employee of Advisors or any of its Subsidiaries to leave such employment or
directly or indirectly employing or causing to be employed any such Employee.

               (b) For purposes of this Section 8.4, a former Managing Director
shall be deemed to be indirectly engaged in an activity described in Section
8.4(a) if such activity is carried out or effected by or through another Person
that is acting at the direction of, or in conjunction with, the former Managing
Director, on behalf of the former Managing Director or any other Person.

               (c) No activity shall be considered to constitute Prohibited
Competition Activity if the involvement of the former Managing Director in such
activity has been approved, prior to the time that he becomes involved in such
activity, by the Advisors Management Board. The determination by the Advisors
Management Board to grant or withhold approval for a former Managing Director to
be involved in any activity that would otherwise constitute Prohibited
Competition Activity shall be final and shall be binding on the parties.

               (d) In the event that the Advisors Management Board determines
that a former Managing Director has engaged in any activity (the "Disputed
Activity") which constitutes the performance of Prohibited Competition Activity,
Advisors shall give written notice (the "Disputed Activity Notice") to the
former Managing Director of the Board's determination that such Disputed
Activity constitutes Prohibited Competition Activity. Such Disputed Activity
Notice shall explain, in reasonable detail, the nature of the Disputed Activity
and the reasons why the Advisors Management Board believes such Disputed
Activity constitutes Prohibited Competition Activity. During the thirty-day
period immediately following the giving of the Disputed Activity Notice, the
former Managing Director shall be entitled to take such remedial action as may
be necessary to cure and eliminate, in all material respects, the performance of
the





                                       20
<PAGE>   21

Disputed Activity, and any such cure or elimination effected within such
thirty-day period shall cause the Disputed Activity to be deemed not to have
constituted Prohibited Competition Activity.


                                   ARTICLE IX
                          DESIGNATION OF BENEFICIARIES;
                               PAYMENT OF BENEFITS

            Section 9.1 Designation of Beneficiaries

               (a) A Participant shall have the right at any time and from time
to time to designate one or more Persons as Beneficiaries and to revoke any such
designation.

               (b) Designation of a Person as a Beneficiary and revocation of
any such designation shall be in writing on a form prescribed by the Committee
and shall become effective upon delivery to the Secretary of Advisors.

            Section 9.2 Distribution of Assets

               (a) After the expiration of the deferral period applicable to a
Plan Year for which Compensation was deferred by a Participant, the Trustee
shall distribute to the Participant, if he is alive at the date of distribution,
the Assets held in his Compensation Deferral Subaccounts and Compensation
Contribution Subaccount, if any, for such Plan Year, less any amount required to
be withheld by law, in accordance with one of the following methods, as elected
by the Participant in his Compensation deferral form for such Plan Year:

                    (i) the distribution of such Assets in one installment, or

                    (ii) with respect to Assets which are not held in his
Canadian Compensation Deferral Subaccounts or Canadian Compensation Contribution
Subaccount, if any, for such Plan Year, the distribution of such Assets in two
or more annual or more frequent installments (not exceeding 20 years or four
installments per year), the Assets included in each such installment to be
determined by dividing the total value of the Assets remaining in such
subaccounts by the remaining number of installments to be paid.

The Participant shall make an election in his Compensation deferral form for
such Plan Year as to whether Assets which are not held in his Canadian
Compensation Deferral Subaccounts or Canadian Compensation Contribution
Subaccount, if any, for such Plan Year shall be distributed in one installment
or two or more annual or more frequent installments. If the Participant elects
to have such Assets distributed in two or more annual or more frequent
installments, he shall specify the number and frequency of such installments at
least one year before the expiration of the deferral period applicable to such
Plan Year. Such specification shall be in writing on a form prescribed by the
Committee and shall become effective upon delivery to the Secretary of Advisors.
If the Participant fails to elect two or more annual or more frequent
installments, or





                                       21
<PAGE>   22

having so elected, fails timely to specify the number and frequency of such
installments, all of such Assets shall be distributed in one installment.

               (b) After the expiration of the deferral period applicable to a
Plan Year in which a Unit Award was received by a Participant, the Trustee shall
distribute to the Participant, if he is alive at the date of distribution, the
Assets held in his Unit Award Deferral Subaccount and Unit Award Contribution
Subaccount, if any, for such Plan Year, less any amount required to be withheld
by law, in accordance with one of the following methods, as elected by the
Participant in his Unit Award deferral form for such Plan Year:

                    (i) the distribution of such Assets in one installment, or

                    (ii) the distribution of such Assets in two or more annual
or more frequent installments (not exceeding 20 years or four installments per
year), the Assets included in each such installment to be determined by dividing
the total value of the Assets remaining in such subaccounts by the remaining
number of installments to be paid.

The Participant shall make an election in his Unit Award deferral form for such
Plan Year as to whether the Assets shall be distributed in one installment or
two or more annual or more frequent installments. If the Participant elects to
have the Assets distributed in two or more annual or more frequent installments,
he shall specify the number and frequency of such installments at least one year
before the expiration of the deferral period applicable to such Plan Year. Such
specification shall be in writing on a form prescribed by the Committee and
shall become effective upon delivery to the Secretary of Advisors. If the
Participant fails to elect two or more annual or more frequent installments, or
having so elected, fails timely to specify the number and frequency of such
installments, all of such Assets shall be distributed in one installment.

                    (c) Upon the death of a Participant, the Trustee shall
distribute to the Participant's Beneficiaries all of the Assets held in his
Deferral Accounts, less any amount required to be withheld by law, in one
installment.

                    (d) The Assets included in an installment shall be
distributed to the Participant or his Beneficiaries within thirty days after the
expiration of the relevant deferral period for the first installment or within
thirty days after the death of the Participant, as the case may be, and within
thirty days after the end of the installment period for subsequent installments,
or as soon as practicable thereafter.

                    (e) The Trustee shall not transfer Advisors Units to a
Participant who is not Qualified or to a Beneficiary. The Trustee shall instead
endeavor to exchange Advisors Units due to be transferred to such a Participant
or to a Beneficiary for Holdings Units prior to the date they are to be
transferred. If such Advisors Units cannot be timely exchanged, the transfer
shall be delayed until they can be exchanged.

                    (f) If a distribution of Benefits includes a fractional
Unit, Advisors shall redeem such fractional Unit, and if a distribution of
Benefits includes Units, Advisors shall redeem such whole number of Units as
shall be necessary in order for the distribution to include





                                       22
<PAGE>   23

cash in the amount required to be withheld by law. In each case, any such
redemption shall be for cash at Fair Market Value, and shall be effected prior
to any exchange of Advisors Units for Holdings Units.


                                    ARTICLE X
                            ADMINISTRATIVE PROVISIONS

            Section 10.1 The Committee

               (a) There shall be a Committee for the Plan. Unless otherwise
provided by the Management Boards, the members of the Unit Incentive Committee
of the Advisors Management Board shall be the members of the Committee, and the
Chairperson of the Unit Incentive Committee shall be the Chairperson of the
Committee.

               (b) The Committee shall act by a majority of its members in
office, either at a meeting or by a written instrument executed by a majority of
the Committee members. The Chairperson of the Committee is authorized to execute
any instrument required to be executed by the Committee.

               (c) The Chairperson of the Committee shall appoint a Secretary to
keep the minutes of its meetings.

            Section 10.2 Duties and Powers of the Committee

               (a) The Committee shall be the named fiduciary of the Plan, and
shall have full and exclusive discretionary power and authority to operate and
administer the Plan in accordance with the Plan and ERISA, including without
limitation exclusive discretionary power and authority:

                    (i) to adopt Rules of the Plan that are not inconsistent
with the Plan or applicable law and to amend or revoke any such Rules;

                    (ii) to construe the Plan and the Rules of the Plan;

                    (iii) to determine questions of eligibility, deferral,
Vesting and forfeiture;

                    (iv) to determine entitlement to Benefits;

                    (v) to make findings of fact as necessary to make any
determinations and decisions in the exercise of such discretionary power and
authority;

                    (vi) to engage actuaries, attorneys, accountants,
appraisers, brokers, consultants, administrators, physicians or other Persons
and to rely upon the reports, advice, opinions or valuations of any such
Persons;




                                       23
<PAGE>   24

                    (vii) to appoint claims officials and review officials to
conduct the procedures described in Section 10.10; and

                    (viii) to delegate any such discretionary power or authority
to the Trustee, executive officers or a committee of executive officers of
Advisors, or any other Person.

               (b) Every finding, determination and decision made by the
Committee shall be final and binding upon all parties, except to the extent
found by a court of competent jurisdiction to constitute an abuse of discretion.

            Section 10.3 Standards of Interpretation and Administration

               The Plan shall be uniformly and consistently interpreted and
applied with regard to all Participants in similar circumstances. The Plan shall
be administered, interpreted and applied fairly and equitably and in accordance
with the specified purposes of the Plan.

            Section 10.4 Payment of Expenses and Indemnification

               (a) Advisors shall pay all expenses (including reasonable
attorneys' fees) reasonably incurred in the administration of the Plan.

               (b) Advisors shall indemnify and hold each Committee member, each
other Person rendering services with respect to the Plan or its operation or
administration, and their respective Affiliates (each, an "Indemnified Person"),
harmless from all claims, liabilities and costs (including reasonable attorneys'
fees) arising out of the good faith performance of their services with respect
to the Plan or its operation or administration.

               (c) Advisors may obtain and provide for any Indemnified Person,
at the expense of Advisors, liability insurance against liabilities imposed on
such Indemnified Person by law.

            Section 10.5 Record Keeping

               (a) The Committee shall maintain, or cause to be maintained,
suitable records of (i) each Participating Employer and the date as of which it
adopted the Plan; (ii) each Participant's Deferral Accounts and subaccounts; and
(iii) the Committee's findings, determinations and decisions.

               (b) The Committee shall not be required to maintain any records
which duplicate any records maintained by the Participating Employers.

            Section 10.6 Statements to Participants

               Within sixty days after the last day of each calendar quarter of
the Plan Year, the Trustee shall furnish to each Participant a statement setting
forth the Assets held in, and the value





                                       24
<PAGE>   25

of, his Deferral Accounts and each of his subaccounts, and such other
information as the Committee shall instruct the Trustee to furnish to the
Participants.

            Section 10.7 Inspection of Records

               Copies of the Plan and the records of a Participant's Deferral
Accounts and subaccounts shall be open to inspection by him or his duly
authorized representatives at the principal office of Advisors at any reasonable
business hour.

            Section 10.8 Identification of Fiduciaries

               The Committee as named fiduciary of the Plan, the Trustee, the
Management Boards, the Participating Employers, and every other Person which
exercises any discretionary authority or discretionary control respecting the
Plan or which has any discretionary authority or discretionary responsibility in
the administration of the Plan, including any Person designated by the Committee
to carry out fiduciary responsibilities under the Plan, shall be a fiduciary of
the Plan and as such shall be subject to the provisions of ERISA and other
applicable laws governing fiduciaries.

            Section 10.9 Procedures for Allocation of Administrative
Responsibilities

               (a) Administrative responsibilities under the Plan shall be
allocated as follows:

                    (i) the sole responsibilities allocated to the Committee,
the Trustee, the Management Boards, any Participating Employer and any other
Person shall be those expressly provided in the Plan; and

                    (ii) all administrative responsibilities not expressly
allocated to the Trustee, the Management Boards, the Participating Employers are
allocated to the Committee, and may be delegated as provided in Section 10.2.

               (b) Administrative responsibilities under the Plan may be
reallocated among the Plan fiduciaries by amending the Plan in the manner
prescribed in Section 11.8, followed by the fiduciaries' acceptance of, or
operation under, such amended Plan.

            Section 10.10 Claims Procedures

               (a) The Committee shall endeavor to ensure that there are at all
times a claims official and a review official who have been appointed by the
Committee and agreed to serve in their respective capacities.

               (b) Any claim by a Participant, Beneficiary or other Person
concerning a Deferral Account, Benefits or other distribution under the Plan,
other than a claim arising under Section 8.3 or 8.4, shall be presented to the
claims official.




                                       25
<PAGE>   26

               (c) The claims official shall, within a reasonable time, consider
the claim and issue his determination thereon in writing.

               (d) If the claim is granted is whole or in part, appropriate
action shall be taken by the Plan fiduciaries to satisfy the claim as granted.

               (e) If the claim is denied in whole or in part, the claims
official shall, within 90 days (or such longer period as may be reasonably
necessary), provide the claimant with written notice of such denial, setting
forth, in a manner calculated to be understood by the claimant:

                    (i) the specific reason or reasons for such denial;

                    (ii) specific reference to pertinent provisions of the Plan
or the Rules of the Plan on which the denial is based;

                    (iii) a description of any additional material or
information necessary for the claimant to perfect the claim and an explanation
of why such material or information is necessary; and

                    (iv) an explanation of the Plan's claims review procedures.

               (f) The Committee shall provide each claimant with a reasonable
opportunity to appeal the claims official's denial of a claim to the review
official. The claimant or his duly authorized representative:

                    (i) may request a review by written application to the
review official;

                    (ii) may review pertinent documents; and

                    (iii) may submit issues and comments in writing.

               (g) The review official may establish such time limits within
which a claimant may request review of a denied claim as are reasonable in
relation to the nature of the claim and to other attendant circumstances, but in
no event less than sixty days after receipt by the claimant of written notice of
denial of his claim.

               (h) The decision by the review official upon review of a claim
shall be made not later than sixty days after his receipt of the request for
review, unless special circumstances require an extension of time for
processing, in which case a decision shall be rendered as soon as possible, but
in no event more than 120 days after receipt of such request for review.

               (i) The decision on review shall be in writing and shall include
specific reasons for the decision written in a manner calculated to be
understood by the claimant with specific references to the pertinent provisions
of the Plan and the Rules of the Plan on which the decision is based.




                                       26
<PAGE>   27

               (j) In considering claims under this claims procedure, the claims
official and the review official shall have fiduciary and discretionary
authority to make findings of fact and to construe the terms of the Plan and the
Rules of the Plan, and the determination of the claims official (if no review is
properly requested) or the decision of the review official (on review, if review
has been properly requested) shall be final and binding on all parties unless
held by a court of competent jurisdiction to constitute an abuse of discretion.

            Section 10.11 Conflicting Claims

               If the Committee is confronted with conflicting claims concerning
a Deferral Account, the Committee may interplead the claimants in an action at
law, or in an arbitration conducted in accordance with the rules of the American
Arbitration Association, as the Committee shall elect in its sole discretion,
and in either case, the attorneys' fees, expenses and costs reasonably incurred
by the Committee in such proceeding shall be paid from such Deferral Account.

            Section 10.12 Service of Process

               The Secretary of Advisors is hereby designated as agent of the
Plan for the service of legal process.



                                   ARTICLE XI
                            MISCELLANEOUS PROVISIONS

            Section 11.1 Termination of the Plan

               (a) While the Plan is intended as a permanent program, the
Management Boards shall have the right at any time to declare the Plan
terminated as to all Participating Employers or as to any Participating
Employer; provided, however, that no such termination shall decrease the
interest of any Participant or any of his Beneficiaries in the Participant's
Deferral Accounts.

               (b) In the event of any termination of the Plan, the Trustee
shall continue to maintain the Participants' Deferral Accounts, and
distributions of Benefits from such Deferral Accounts shall continue to be made
in accordance with Article IX.

            Section 11.2 Limitation on Rights of Employees

               The Plan is strictly a voluntary undertaking on the part of the
Participating Employers and shall not constitute a contract between a
Participating Employer and any Employee with respect to, or consideration for,
or an inducement or condition of, the employment of such Employee. Nothing
contained in the Plan shall give any Employee the right to be retained in the
service of his Employer or to interfere with or restrict the rights of the




                                       27
<PAGE>   28

Participating Employers, which are hereby expressly reserved, to discharge or
retire any Employee at any time without notice and with or without cause.

            Section 11.3 Unfunded Obligations of the Participating Employers

               The obligations of the Participating Employers under the Plan
shall be unfunded and unsecured, and nothing contained in the Plan shall be
construed as providing for Assets of the Rabbi Trust to be segregated from the
assets of Participating Employers for the benefit of any Participant or
Beneficiary. To the extent that a Participant or Beneficiary has the right to
receive Benefits, such right shall be no greater than the right of an unsecured
general creditor of such Participant's Employer to be paid from the Assets in
the Participant's Deferral Accounts. The Plan is intended to be "unfunded" for
purposes of the Code and Title I of ERISA.

            Section 11.4 Adoption of Plan by Other Employers: Consolidation or
Merger

               (a) An Investment Management Firm which is not a Participating
Employer may, not less than six weeks before the end of a Plan Year (or such
shorter period as may be determined by the Committee) and with the consent of
the Management Boards, adopt the Plan effective as of the first day of the
following Plan Year.

               (b) In the event of the consolidation or merger of a
Participating Employer with or into any other Business Entity, or the sale by a
Participating Employer of all or substantially all of its assets to another
Business Entity, the successor Business Entity may, with the consent of the
Management Boards, continue to participate in the Plan by adopting the Plan. If
within 90 days from the effective date of such consolidation, merger or sale of
assets, such successor Business Entity does not adopt the Plan, the Plan shall
be terminated in accordance with Section 11.1 as to such Participating Employer.

            Section 11.5 Certain Transactions

               (a) If the outstanding Advisors Units are converted into or
exchanged for securities of another Business Entity or cash, the Trustee shall
be authorized to take such actions as the Committee may find to be appropriate
and equitable to cause the Advisors Units held in the Rabbi Trust to be
converted into or exchanged for such securities or cash. If the Advisors Units
are converted into or exchanged for such securities, all references in the Plan
to Advisors Units shall be deemed to be references to such securities. If the
Advisors Units are exchanged for cash, the Trustee shall invest such cash in
such securities as shall be recommended from time to time by the Committee.

               (b) If the outstanding Holdings Units are converted into or
exchanged for securities of another Business Entity, all references in this Plan
to Holdings Units shall be deemed to be references to such securities. If the
outstanding Holdings Units are exchanged for cash, the Trustee shall be
authorized to take such actions as the Committee may find to be appropriate and
equitable to cause the Advisors Units held in the Rabbi Trust to be exchanged
for Holdings Units, and to cause such Holdings Units to be exchanged for cash,
and the Trustee shall invest such cash in such securities as shall be
recommended from time to time by the Committee.





                                       28

<PAGE>   29

            Section 11.6 Errors and Misstatements

               In the event of any clerical error or any misstatement or
omission of fact by a Participant which results in the distribution of Benefits
in an incorrect amount, the Committee shall upon discovery of the facts promptly
cause the amount of future distributions of Benefits to be corrected. The
Trustee shall, as appropriate, distribute any underpayment to the Participant or
his Beneficiaries in a lump sum. The Trustee may, as appropriate, recoup any
overpayment from future distributions of Benefits to the Participant or his
Beneficiaries in such amounts as the Committee shall direct or proceed against
the Participant or his Beneficiaries for recovery of such overpayment.

            Section 11.7 Payment on Behalf of Beneficiary

               In the event any Benefits would be distributed under the Plan to
a Beneficiary who is a minor, or a person who is considered by the Committee, by
reason of his physical, mental or emotional condition, to be unable to give a
valid receipt therefor, the Committee may direct that such Benefits be
distributed to any Person found by the Committee to have assumed the care of
such minor or other person. Any distribution made pursuant to such direction
shall constitute a full release and discharge of the Committee and the other
Plan fiduciaries.

            Section 11.8 Amendment of Plan

               The Management Boards shall have exclusive power and authority to
adopt amendments to the Plan from time to time, including retroactive amendments
necessary to conform to the provisions and requirements of ERISA or the Code or
the regulations thereunder; provided, however, that no such amendment shall be
operative to the extent it adversely affects the rights of a Participant or his
Beneficiaries in the Assets in such Participant's Deferral Accounts as of the
effective date of such Amendment.

            Section 11.9 Governing Law

               The Plan shall be construed and administered under, and governed
in all respects by, applicable federal laws and, where state law is applicable,
the laws of the State of California, without regard to principles of conflict of
laws.

            Section 11.10 Pronouns and Plurality

               The masculine shall include the feminine, and where the context
so indicates, the singular shall include the plural.

            Section 11.11 Titles

               Titles are provided herein for convenience only and shall not
serve as a basis for interpretation or construction of the Plan.





                                       29
<PAGE>   30

            Section 11.12 References

               References to a statute, regulation or document shall be
construed as referring to any subsequently enacted, adopted or executed statute,
regulation or document.


                     Executed at Newport Beach, California.


                                                PIMCO Advisors L.P.

                                                By: \s\ William D. Cvengros
                                                    ----------------------------

                                                Name: William D. Cvengros
                                                      --------------------------

                                                Title: CEO
                                                       -------------------------


                                                PIMCO Advisors Holdings L.P.

                                                By: \s\ William D. Cvengros
                                                     ---------------------------

                                                Name: William D. Cvengros
                                                      --------------------------

                                                Title: CEO
                                                       -------------------------


<PAGE>   31

                                   SCHEDULE 1
                                DEFERRAL EXAMPLES


Example One.  Employee receiving Bonus Compensation in two equal payments.

               Assume a Mandatory Participant with Base Salary of $150,000 and
Bonus Compensation for the Plan Year of $370,000, which is paid in two equal
installments. The amount to be deferred from such Compensation for such Plan
Year would be $31,000 (10% of $250,000, plus 30% of $20,000). Accordingly,
$15,500 would be deferred from each payment of Bonus Compensation.

Example Two. Employee receiving Bonus Compensation in three unequal payments.

               Assume a Mandatory Participant with Base Salary of $250,000 and
Bonus Compensation for the Plan Year of $2,750,000, paid as follows: $500,000 in
June, $750,000 in October, and $1,500,000 in December: further assume that the
Participant's Employer has prescribed 40% as the percentage deferral for
Compensation over $1,000,000. The amount to be deferred from such Compensation
for such Plan Year would be $975,000 (10% of $250,000, plus 30% of $500,000,
plus 40% of $2,000,000). Accordingly, 35.45% ($975,000 divided by $2,750,000) of
each payment of Bonus Compensation would be deferred, or $177,273 from the first
payment, $265,909 from the second payment, and $531,818 from the third payment.

Example Three.  Employee receiving quarterly commission payments.

               Assume a Participant with Base Salary of $80,000, who receives
commission payments for the Plan Year of $100,000 in April, $100,000 in July,
$50,000 in October and $100,000 in the following January. From the first
commission payment, no amount would be deferred. From the second payment $3,000
would be deferred (10% of $30,000). From the third payment $5,000 would be
deferred (10% of $80,000, less $3,000 already deferred). From the fourth
payment, $10,000 would be deferred (10% of $180,000, less $8,000 already
deferred).




                                       31