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                            FINLAY ENTERPRISES, INC.
             DIRECTOR DEFERRED COMPENSATION AND STOCK PURCHASE PLAN

                             2003 DEFERRAL AGREEMENT
(This Deferral Agreement is not effective until filed with and receipt is
acknowledged by the Committee)

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Participant's Last Name: _____________First: _______________ Middle: __________

Address:     ____________________________________________________________
                           (Street)

             ------------------------------------------------------------
                           (City, State, Zip Code)

Social Security Number:   _ _ _ - _ _  - _ _ _ _

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I.       ELECTION TO DEFER ELIGIBLE DIRECTOR FEES.
         -----------------------------------------

I hereby elect to participate in the Finlay Enterprises, Inc. Director Deferred
Compensation and Stock Purchase Plan (the "Plan") and to defer payment (for the
deferral period I elect below) of 100% of my Eligible Director Fees with respect
to the remainder of 2003.

In lieu of 100% of my Eligible Director Fees, I acknowledge that my Account
under the Plan will be credited with a number of restricted stock units ("RSUs")
equal to the amount I elect to defer hereunder divided by the Fair Market Value
of a share of Common Stock on the first business day of the commencement of the
third and fourth quarters of the Corporation's 2003 fiscal year, which are the
dates my Eligible Director Fees would otherwise be paid to me if I did not elect
to participate in the Plan (each an "Award Date"). If I elect to purchase RSUs
in accordance with this Deferral Agreement and the Plan, the Corporation will
credit my Account with one Matching RSU for each RSU that I purchase.

I acknowledge and agree that for this election to be effective this election
must be made no later than: (i) July 1, 2003, solely with respect to the first
Plan Year or (ii) 30 days after the day in which I become a participant in the
Plan, if I first become eligible to participate during a Plan Year, as the case
may be.

II.      DEFERRAL PERIOD; PAYMENT.
         -------------------------

I understand that my Account will be distributed to me as soon as practicable
after the deferral period I elect below (check only one), or, if earlier, as
soon as practicable after my termination of directorship, provided that if my
directorship terminates for any reason other than due to death, Disability, or a
Change in Control or a termination of the Plan, each vested Matching RSU in my
Account will be distributed 12 months after such termination:

                 [ ] 3 Years after the applicable Award Date
                 [ ] 5 Years after the applicable Award Date
                 [ ] 7 Years after the applicable Award Date


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The Committee may permit me to extend the deferral period I elect hereunder for
additional two year periods, provided that such extension is made at least one
year prior to the expiration of the applicable deferral period.

III.     ACKNOWLEDGEMENTS.
         -----------------

I understand that this election is binding and irrevocable and is valid only for
the Plan Year following this election. If no new election is made with respect
to any subsequent Plan Year, my Eligible Director Fees earned in such Plan Year
will not be deferred under the Plan.

I acknowledge that I have received and reviewed a copy of the Plan and the Plan
Summary/Prospectus and that this election form and my participation in the Plan
is subject to the terms, conditions and provisions of the Plan. I further
acknowledge and agree that my Matching RSUs are subject to a vesting schedule
and, once vested, will be forfeited if I engage in Detrimental Activity during
certain periods specified in the Plan. Unless otherwise defined herein, any
capitalized term shall have the meaning ascribed to such term in the Plan

I acknowledge and agree that my participation in the Plan involves risk,
including the possibility of loss since the Corporation's Common Stock is
subject to market fluctuation. I hereby agree that I have evaluated and
understand the risks associated with my investment in the Corporation's Common
Stock.

I hereby consent to the jurisdiction of the Federal courts whose districts
encompass any part of Manhattan in connection with any dispute arising under the
Plan and I hereby waive, to the maximum extent permitted by law, any objection
based on forum non conveniens, to the conducting of any such proceeding in such
jurisdiction.

I acknowledge and agree that if the Corporation's stockholders do not approve
the Plan, this Deferral Agreement and any elections hereunder shall be null and
void ab initio.


Signature of Participant: ______________________     Date____________________


Receipt Acknowledged:

Committee

By: _______________________________________ Date ___________________