<PAGE>

                                                                   Exhibit 10(k)

                                            As amended through October 9, 2000


                               XEROX CORPORATION
                   DEFERRED COMPENSATION PLAN FOR DIRECTORS
           (Formerly 1989 Deferred Compensation Plan For Directors)

                        1997 AMENDMENT AND RESTATEMENT

<PAGE>

     Preamble. This Plan is a private unfunded nonqualified deferred
compensation arrangement for Directors and all rights shall be governed by and
construed in accordance with the laws of New York, except where preempted by
federal law. It is intended to provide a vehicle for setting aside funds for
retirement.

     Section 1.  Effective Date.  The original effective date of the Plan is
January 1, 1989. The effective date of this amendment and restatement is
October 9, 2000.

     Section 2. Eligibility. Any Director of Xerox Corporation (the "Company")
who is not an officer or employee of the Company or a subsidiary of the Company
is eligible to participate in the Plan (a Director who has so elected to
participate is hereinafter referred to as a "Participant"). A Participant who
terminates an election to defer receipt of compensation is not eligible to
participate again in the Plan until twelve months after the effective date of
such termination.

     Section 3.  Deferred Compensation Accounts.  There shall be established
for each Participant one or more deferred compensation Accounts (as
hereinafter defined).

     Section 4.  Amount of Deferral.

     (a) A Participant may elect to defer receipt of all or a specified part,
expressed as a percentage of the cash compensation otherwise payable to the
Participant for serving on the Company's Board of Directors or committees of the
Board of Directors. Any amount deferred is credited to the Participant's
Accounts on the date such amount is otherwise payable.

     (b) In addition to the foregoing, there shall be credited to the deferred
compensation accounts of each person who is serving as a Director on May 17,
1996 a sum computed by the Company as the present value of his or her accrued
benefit under the Company's Retirement Income Plan For Directors, if any, as of
such date and each such Director shall be given notice of such amount. The
amount so computed shall be final and binding on the Company and each such
Director. Within 30 days of the giving of such notice, each such Director shall
make an election on a form provided by the Company as to the hypothetical
investment of such amount and the payment methods as permitted under Sections 6
and 8 hereof as in effect on such date under the administrative rules adopted by
the Administrator.

     Section 5. Time of Election to Defer. The election to defer will be made
prior to the individual's commencement of services as a Director for amounts to
be earned for the remainder of the calendar year. In the case of an individual
currently serving as a Director, the election to defer must be made prior to
December 31, of any year for amounts to be earned in a subsequent calendar year
or years. An election to totally terminate deferrals may be made at any time
prior to the relevant payment date.

     Section 6. Hypothetical Investment. Deferred compensation is assumed to be
invested, without charge, in the (a) Balanced Fund, Income Fund, U.S. Stock
Fund, International Stock Fund, Small Company Stock Fund or Xerox Stock Fund (or
the successors thereto) (the "Funds") established from time to time

<PAGE>

under the Xerox Corporation Profit Sharing and Savings Plan (the "Profit Sharing
Plan") (b) a fund with a variable fixed rate of return based upon the prime or
base rate charged by one or more banks ("Prime Rate Investment") and (c) such
other fixed income return investments ("Fixed Return Investment"), all as shall
be made available from time to time by the Administrator in his or her
administrative discretion ("Investments") as elected by the participant

     It is anticipated that the Administrator will substitute the Prime Rate
Investment for the Income Fund effective January 1, 1998. Amounts deferred prior
to January 1, 1998 shall have a rate of return at the Income Fund or the Prime
Rate Investment as elected by Participants on forms provided by the
Administrator in connection with the implementation of the Prime Investment
Rate.

     Elections to make hypothetical investments in any one or more of the
Investments shall be subject to administrative rules adopted by the
Administrator from time to time.

     No shares of Xerox stock will ever actually be issued to a Participant
under the Plan.

     Section 7. Value of Deferred Compensation Accounts and Installment
Payments. The value of each Participant's Accounts shall reflect all amounts
deferred, gains , losses and rates of return from the Investments, and shall be
determined at the close of business on each day on which securities are traded
on the New York Stock Exchange. Hypothetical investments in the Profit Sharing
Plan shall be valued on each business day based upon the value of such
hypothetical investment as determined under such Plan on the valuation date
under such Plan coincident with or last preceding such business day. The value
of Investments not made under the Profit Sharing Plan shall be determined from
such available source or sources as the Administrator in his or her sole
discretion shall from time to time determine. The date as of which investments
are valued pursuant to the foregoing sentences are referred to herein as a
Valuation Date.

     Section 8. Manner of Electing Deferral. A Participant may elect to defer
compensation by giving written notice to the Administrator on a form provided by
the Company, which notice shall include (1) the percentage to be deferred; (2)
if more than one is offered under the Plan, the hypothetical investment
applicable to the amount deferred; and (3) the payment method that will apply to
the deferred compensation. A Participant may elect to a maximum of four separate
payment methods during his or her participation in the Plan ("Accounts"). Such
payment methods once made may never be changed. Each election to defer
compensation under the Plan shall specify an Account from which payment will be
made. The Accounts available under the Plan shall be:

     Account 1 which shall be payable beginning the July 15 of a calendar year
that follows the calendar year of retirement by the number of years elected by
the Participant (0, 1, 2, 3, 4, or 5 years). The last payment shall be on the
July 15 of the year in which the Participant attains a certain age elected by
the Participant.

     Account 2 which shall be payable beginning the July 15 of a calendar year
that follows the calendar year of retirement by the number of years elected by
the Participant (0, 1, 2, 3, 4, or 5 years) and is payable on each subsequent
July 15 until the number of payments elected by the Participant have been made.

<PAGE>

     Account 3 which shall be payable on the July 15 of a calendar year that
follows the calendar year of retirement by the number of years elected by the
Participant (0, 1, 2, 3, 4, or 5 years) and is payable as a single sum.

     Account 4 shall be available with respect to amounts deferred during 1998
and later years. This account is payable beginning on the July 15 of a specified
year whether before or after retirement. In addition to this payment date, the
Participant must elect the number of payments that are to commence on this date.
The payment(s) from this account can be as a single sum or payable in up to four
annual installments. Once Account 4 is established (an election is made to defer
and the payment date is defined), deferrals to Account 4 shall cease for any
calendar year in which a payment is scheduled to be made from this Account. The
full account balance shall be distributed by the end of the installment period.
Once the final payment is made from this Account, the Participant may elect to
create a new Account 4. The initial election or any subsequent election to use
this Account must be made by December 31 of the year preceding the calendar year
in which deferrals will be allocated to this Account. The first payment date
that can be elected is the July 15 of the calendar year that follows the
calendar year of election (calendar year containing the December 31 due date for
election) by three years.

     Not later than December 31, 1997, Participants who are currently serving as
Directors of the Company may change their payment elections previously made
under the Plan which specified payment dates relating to termination,
retirement, death, or disability, by selecting payments pursuant to the methods
described in Accounts 1 through 3 above. Such change shall be effected by the
Participant filing with the Administrator a change of election on a form or
forms established by the Administrator for such purpose. Such change shall be
effective only with respect to payments in 1999 or later for Participants who
are serving on the Company's Board of Directors as of December 31, 1998.

     The Administrator may adopt rules of general applicability for
administration of payments under the Plan which may be elected by Participants,
including without limitation, fixing the maximum age selected for payments to
terminate and the maximum number of payments.

     Section 9.  Payment of Deferred Compensation.

     (a) No withdrawal may be made from the Participant's Account, except as
provided under this Section and Sections 10 and 11.

     (b) Payments from a Participant's Account are made in cash in accordance
with the elections made under Section 8 of the Plan based on the value of the
Participant's deferred compensation Accounts as of the Valuation Date
immediately preceding the date of payment.

     (c) Unless otherwise elected by a Participant with the written approval of
the Administrator, payments of deferred compensation shall be made pursuant to
the following formula: the amount of the first payment shall be a fraction of
the value of the Participant's deferred compensation account on the preceding
Valuation Date, the numerator of which is one and the denominator of which is
the total number of installments elected, and the amount of each subsequent
payment shall be a fraction of the value on the Valuation Date preceding each
subsequent payment date, the numerator of which is one and the

<PAGE>

denominator of which is the total number of installments elected minus the
number of installments previously paid. Any other payment method selected with
the written approval of the Administrator must in all events provide for
payments in substantially equal installments.

     (d) Upon termination of service on the Board of Directors, other than
termination resulting from death, prior to retirement, the total value of the
Participant's Accounts under the Plan shall be paid to the Participant as soon
as administratively possible after his or her date of termination.

     (e) Upon the death of a Participant either before or after retirement the
total value of the Participant's Accounts under the Plan shall be paid in
accordance with an election made by such Participant in a lump sum or in
installments, as appropriate, from the Accounts established under Section 8 to
the beneficiary(ies) designated by the Participant.

     (f) If a Participant dies either before or after retirement without having
made such an election, the total value of his or her Accounts under the Plan
shall be paid in a single payment to the Participant's estate as soon as
administratively possible after notice of his or her date of death has been
received by the Administrator.

     Section 10.  Acceleration of Payment for Hardship.

     (a) For Hardship. Upon written approval from the Board of Directors (with
the Participant requesting the withdrawal not participating) a Participant may
be permitted to receive all or part of his accumulated benefits if, in the
discretion of such Board of Directors, it is determined that an emergency event
beyond the Participant's control exists and which would cause such Participant
severe financial hardship if the payment of his benefits were not approved. Any
such distribution for hardship shall be limited to the amount needed to meet
such emergency. A Participant who makes a hardship withdrawal cannot reenter the
Plan for twelve months after the date of withdrawal.

     (b) Upon a Change in Control. Within 5 days following the occurrence of a
change in control of the Company (as hereinafter defined), each Participant
shall receive a lump sum payment equal to the value of his or her Account. For
purposes hereof, a "change in control of the Company" shall be deemed to have
occurred if (A) any "person" (as such term is used in Sections 13(d) and 14(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act")), other
than (1) the Company, (2) any trustee or other fiduciary holding securities
under an employee benefit plan of the Company, (3) any company owned, directly
or indirectly, by the shareholders of the Company in substantially the same
proportions as their ownership of stock of the Company, or (4) any person who
becomes a "beneficial owner" (as defined below) in connection with a transaction
described in clause (1) of subparagraph (C) below, is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company (not including in the securities
beneficially owned by such person any securities acquired directly from the
Company or its affiliates) representing 20% or more of the combined voting power
of the Company's then outstanding securities; (B) the following individuals
cease for any reason to constitute a majority of the directors then serving:
individuals who, on October 9, 2000 constitute the Board and any new director
(other than a director whose initial assumption of office is in connection with
an actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election

<PAGE>

of directors of the Company) whose appointment or election by the Board or
nomination for election by the Company's shareholders was approved or
recommended by a vote of at least two-thirds of the directors then still in
office who were directors on October 9, 2000 or whose appointment, election or
nomination for election was previously so approved or recommended; (C) there is
consummated a merger or consolidation of the Company or any direct or indirect
subsidiary of the Company with any other corporation other than (1) a merger or
consolidation which results in the directors of the Company immediately prior to
such merger or consolidation continuing to constitute at least a majority of the
board of directors of the Company, the surviving entity or any parent thereof or
(2) a merger or consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no person is or becomes the beneficial
owner, directly or indirectly, of securities of the Company (not including in
the securities beneficially owned by such person any securities acquired
directly from the Company or its affiliates) representing 20% of more of the
combined voting power of the Company's then outstanding securities; or (D) the
shareholders of the Company approve a plan of complete liquidation or
dissolution of the Company or there is consummated an agreement for the sale or
disposition by the Company of all or substantially all of the Company's assets,
other than a sale or disposition by the Company of all or substantially all of
the Company's assets to an entity, at least 50% of the combined voting power of
the voting securities of which are owned by stockholders of the Company in
substantially the same proportions as their ownership of the Company immediately
prior to such sale.

     Section 11. Other Penalized Withdrawals. Notwithstanding the provisions of
Sections 9 and 10, a Participant may be permitted to receive all or part of his
accumulated benefits at any time provided that (A) the Administrator approves
such distribution in his or her sole discretion, and (B) the Participant
forfeits a portion of his account balance equal to a percentage of the amount
distributed. The percentage reduction shall be the greater of (A) six percent,
or (B) a percentage equal to one-half of the prime interest rate, as determined
by the Administrator.

     Section 12. Time Of Investment. Amounts deferred under the Plan shall begin
to be credited with gains, losses and rates of return from Investments
commencing on the date credited to the Participant's Accounts.

     Section 13. Participant's Rights Unsecured. The benefits payable under this
Plan shall be unfunded. Consequently, no assets shall be segregated for purposes
of this Plan and placed beyond the reach of the Company's general creditors. The
right of any Participant to receive future installments under the provisions of
the Plan shall be an unsecured claim against the general assets of the Company.

     Section 14. Statement of Account. Statements will be sent to each
Participant by February and August and more frequently if the Administrator so
determines as to the value of their deferred compensation accounts as of the end
of December and June, respectively.

     Section 15. Assignability. No right to receive payments hereunder shall be
transferable or assignable by a Participant, except by will or by the laws of
descent and distribution or except as provided under Section 9.

     Section 16. Business Days. In the event any date specified herein falls on
a Saturday, Sunday or legal holiday, such date shall be deemed to refer to the
next business day thereafter.

<PAGE>

     Section 17. Administration. The Plan shall be administered by the Vice
President of the Company having responsibility for human resources (the
"Administrator"). The Administrator shall have the authority to adopt rules and
regulations for carrying out the plan, and interpret, construe and implement the
provisions of the Plan.

     Section 18. Amendment. The Company expressly reserves the right to amend
the Plan at any time and in any particular manner. Such amendments, other than
amendments relating to termination of the Plan or relating to Investments under
Section 6 of the Plan, may be effected by (i) the Board of Directors, (ii) a
duly constituted committee of the Board of Directors ("Committee"), or (iii) the
Vice President of the Company responsible for human resources or a
representative thereof. In the event such office is vacant at the time the
amendment is to be made, the Chief Executive Officer of the Company shall
approve such amendment or appoint a representative. Amendments relating to
termination of the Plan or relating to Investments under Section 6 of the Plan
shall be effected pursuant to a resolution duly adopted by the Board of
Directors of the Company, or a duly constituted committee of the Board of
Directors of the Company, in accordance with the Business Corporation Law of the
State of New York.

     Any amendment, alteration, modification or suspension under subsection
(iii) of the preceding paragraph shall be set forth in a written instrument
executed by any Vice President of the Company and by the Secretary or an
Assistant Secretary of the Company.

     Upon termination the Administrator in his or her sole discretion may pay
out account balances to participants. No amendment, modification or termination
shall, without the consent of a Participant, adversely affect such Participant's
accruals in his/her Accounts.