Prepared by MerrillDirect





Exhibit 10.4


Amendment Number 1


to


Watson Wyatt & Company


Senior Officers Deferred
Compensation Plan


Section 4 is amended as follows:


4.
Requirement to Defer


If a Participant's Applicable Employee Remuneration exceeds
$1,050,000, the amount in excess of $1,000,000 will be deferred. Amounts
deferred under this Paragraph 4 shall be referred to as the "Deferred
Amounts."


Section 6 is amended as follows:


6.
Investment Options and Additions to Deferred Amounts


The Plan shall offer a minimum of three Investment Options
including an interest factor equal to the prime rate of interest as reported by
BankAmerica, or the Company's bank if different. A Participant's Deferred
Compensation Account shall be deemed to be invested in the Investment Options
the Participant has selected and may thereafter be changed in accordance with
policies and procedures developed by the Committee.


Executed on behalf of Watson Wyatt & Company pursuant to
authorization of its Board of Directors given on December 18, 2000.


 


	/s/ Walter W. Bardenwerper	Vice
  President and Secretary	 	8/17/01	 
	

	 	 	 	 
	Walter W. Bardenwerper	 	 	 	 






 



Watson
Wyatt & Company



Senior
Officers Deferred Compensation Plan



1. Purpose


The purpose of the Watson Wyatt & Company Voluntary Deferred
Compensation Plan (the "Plan") is to preserve Watson Wyatt &
Company's tax deduction for compensation in excess of $1,000,000 which is
otherwise lost under section 162(m) of the Internal Revenue Code.


2.
Administration


The Plan shall be administered by the Compensation and Stock Committee
of the Board of Directors of the Company (the "Committee"). The
Committee shall have sole and complete authority to interpret the terms and
provisions of the Plan and to delegate various administrative tasks to
appropriate officers and employees of the Company.


3.
Eligibility


The chief executive officer and the other four highest compensated
officers as disclosed in the proxy shall participate in the Plan if their
Applicable Employee Remuneration (as defined in section 162(m)(4) of the
Internal Revenue Code) exceeds $1,000,000. Such persons shall be collectively
referred to as the "Participant" or "Participants" as the
case may be.


4.
Requirement to Defer


If a Participant's Applicable Employee Remuneration exceeds
$1,000,000, the amount in excess of $1,000,000 will be deferred. Amounts
deferred under this Paragraph 4 shall be referred to as the "Deferred
Amounts."


5.
Establishment of Deferred Compensation Account


At the time of the Participant's initial deferral pursuant to
Paragraph 4, the Company shall establish a memorandum account (a "Deferred
Compensation Account") for such Participant on its books. Deferred Amounts
shall be credited to the Deferred Compensation Account at the time the Deferred
Amounts would have been paid to the Participant if no deferral were made.
Additions as provided in Paragraph 6, below; shall be credited to the
Participant's Deferred Compensation Account as of the last day of each month.


6. Additions
to Deferred Amounts


As of the last day of each month, the balance in the Participant's
Deferred Compensation Account at the beginning of that month shall be credited
with interest using an interest factor equivalent to the prime rate of interest
as reported by NationsBank at the beginning of such month.


7. Payment
of Deferred Amounts


Except as otherwise provided in subparagraph (b) below, the period
of deferral shall be until the earlier of (i) the Participant is not named in
the Summary Compensation Table of the Watson Wyatt & Company proxy or (ii)
payment of the Deferred Amount will be deductible by Watson Wyatt &
Company.




Payments made because the Participant is not
named in the Summary Compensation Table shall be in a lump sum.



In the event of the Participant's death, payment
of the balance in the Participant's Deferred Compensation Account shall be made
to the beneficiary designated by the Participant in writing and delivered to
the Committee, or if none, to the Participant's estate.



	(b)	A Participant shall receive the balance in the
  Deferred Compensation Account as soon as practical after the occurrence of a
  Change in Control of the Company. The term "Change in Control"
  shall mean a Change in Control of a nature that would be required to be
  reported, by persons or entities subject to the reporting requirements of Section
  14(a) of the Securities and Exchange Act of 1934 (the 1934 Act) in response
  to item 6(e) of Schedule 14A of Regulation 14A, or successor provisions
  thereto, as in effect on the date hereof; provided that, without limitation,
  such a Change in Control shall be deemed to have occurred if (1) any
  "person" or "group" (as those terms are used in Sections
  13(d) and 14(d) of the 1934 Act) is or becomes the "beneficial
  owner" (as defined in Rule 13(d)–3 issued under the 1934 Act),
  directly or indirectly, of securities of the Company representing 20 percent
  or more of the combined voting power of the Company's then outstanding
  securities; or, if, (2) at any time during any period of two consecutive
  fiscal years, individuals who at the beginning of such period constitute the
  board of directors of the Company cease for any reason to constitute at least
  the majority thereof unless the election, or the nomination for election by
  the Company's shareholders, of each new director was approved by a vote of at
  least two-thirds of the directors still in office who were directors at the
  beginning of such two-year period; or if (3) the Company is merged into or
  consolidated with another entity, as a result of which the shareholders of
  the Company immediately prior to such merger or consolidation own less than
  75% of the voting interest in the surviving entity or the parent of the
  surviving entity.



8. Participant Reports


The Committee shall provide a statement to the Participant at
least annually concerning the status of his/her Deferred Compensation Account.


9.
Transferability of Interests


All Deferred Compensation Accounts shall be merely bookkeeping
entries. Any assets which may be reserved to pay benefits hereunder, shall be
considered as general assets of the Company for use as it deems necessary and
shall be subject to the claims of the Company's creditors.


The rights and interests of a Participant shall be solely those of
a general creditor of the Company and such Participant's rights and interests
may not be anticipated, assigned, pledged, transferred or otherwise encumbered
or disposed of except in the event of the death of the Participant, and then
only by will or the laws of descent and distribution.


10.
Conditions of Employment Not Affected by the Plans


The establishment and maintenance of the Plans will not be
construed as conferring any legal rights upon any person to the continuance of
his/her employment with the Company or any of its subsidiaries, nor will the
Plans interfere with the rights of the Company or any of its subsidiaries to
discharge any person from its employ.





 


11.
Amendment, Suspension and Termination


The Company by action of its Board of Directors may amend, suspend
or terminate the Plan or any portion thereof in such manner and to such extent
as it may deem advisable and in the best interests of the Company. No
amendment, suspension and termination shall alter or impair any Deferred
Compensation Accounts without the consent of the Participant affected thereby.


12. Unfunded
Obligation


The Plan shall not be funded, and no trust, escrow or other
provisions shall be established to secure payments due under the Plan. A
Participant shall be treated as a general, unsecured creditor of the Company at
all times under the Plan.


13.
Applicable Law


The Plan will be construed and enforced according to the laws of
Maryland and all provisions of the Plan will be administered accordingly.


14.
Severability


If any provision of this Plan is declared to be invalid or
unenforceable, such provision shall be severed from this Plan and the other
provisions hereof shall remain in full force and effect.


15.
Effective Date


The Plan shall be effective immediately upon approval by the Board
of Directors of the Company.


 


Executed on behalf of Watson Wyatt & Company
pursuant to authorization of its Board of Directors given on February 21, 1997.



	/s/ Walter W. Bardenwerper	Vice
  President and Secretary	 	8/17/01	 
	

	 	 	 	 
	Walter W. Bardenwerper