STATEN ISLAND BANCORP, INC.

                           Deferred Compensation Plan
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                           STATEN ISLAND BANCORP, INC.

                           Deferred Compensation Plan



1.  Purposes..................................................................1

2.  Definitions...............................................................1

3.  Administration............................................................3

4.  Participation.............................................................4

5.  Deferrals.................................................................4

6.  Deferral Accounts For Non-Stock-Denominated Awards........................5

7.  Deferral Accounts For Stock-Denominated Awards............................6

8.  Settlement of Deferral Accounts...........................................7

9.  Provisions Relating to Section 16 of the Exchange Act and
     Section 162(m) of the Code...............................................8

10. Statements................................................................9

11. Sources of Stock: Limitation on Account of Stock-Denominated Deferrals....9

12. Amendment/Termination.....................................................9

13. General Provisions.......................................................10

14. Effective Date...........................................................11
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STATEN ISLAND BANCORP, INC.

Deferred Compensation Plan


         1.  Purposes.  The  purpose  of this  Deferred  Compensation  Plan (the
"Plan") is to provide  certain  highly  compensated  employees of Staten  Island
Bancorp, Inc. (the "Company") and its subsidiaries with the opportunity to elect
to defer receipt of specified  portions of their  compensation  and to have such
deferred amounts treated as if invested in specified investment vehicles.

         2.  Definitions.  In addition to the terms  defined in Section 1 above,
the following terms used in the Plan shall have the meanings set forth below:

         (a)  "Administrator"  shall  mean  such  person or  persons  designated
pursuant to Section 3(b) hereof to whom the Committee has delegated authority to
take action under the Plan, except as may be otherwise  required under Section 9
hereof.

         (b)  "Beneficiary"  shall mean any person (which may include trusts and
is not limited to one person) who has been  designated by the Participant in his
or her most recent written  beneficiary  designation form filed with the Company
to  receive  the  benefits  specified  under  the  Plan  in  the  event  of  the
Participant's  death.  If no Beneficiary has been designated or if no designated
Beneficiary  survives the  Participant's  death, then the Beneficiary shall mean
the Participant's estate.

         (c) "Change in Control"  shall be deemed to have  occurred  if: (i) the
acquisition of control of the Company as defined in 12 C.F.R. ss.574.4, unless a
presumption  of control is  successfully  rebutted or unless the  transaction is
exempted by 12 C.F.R. ss.574.3(c)(vii),  or any successor to such sections; (ii)
an event that would be  required to be reported in response to Item 1(a) of Form
8-K or Item 6(e) of Schedule 14A of Regulation  14A pursuant to the Exchange Act
(as defined  below),  whether or not any class of  securities  of the Company is
registered  under the Exchange Act;  (iii) any "person" (as such term is used in
Section  13(d) and 14(d) of the  Exchange  Act),  is or becomes the  "beneficial
owner"  (as  defined  in  Rule  13d-3  under  the  Exchange  Act),  directly  or
indirectly,  of the  securities of the Company  representing  20% or more of the
combined  voting power of the Company's  then  outstanding  securities;  or (iv)
during  any  period  of three  (3)  consecutive  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 a majority thereof unless the election, or
the nomination for election by  stockholders,  of each new director was approved
by a vote of at least  two-thirds of the directors then still in office who were
directors at the beginning of the period.

         (d) "Code"  shall mean the Internal  Revenue Code of 1986,  as amended.
References  to any  provision  of the  Code or  regulation  (including  proposed
regulation) thereunder shall include any successor provisions or regulations.

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         (e)  "Committee"  shall  mean two or more  non-employee  members of the
Board of Directors of the Company designated by such Board as the Committee.

         (f)  "Deferral  Account"  shall  mean  Non-Stock-Denominated   Deferral
Accounts  and  Stock-Denominated  Deferral  Accounts,   collectively.   Deferral
Accounts  will be  maintained  solely as  bookkeeping  entries by the Company to
evidence the unfunded obligations of the Company hereunder.

         (g)  "Disability"  shall mean any physical or mental  impairment  which
qualifies the Participant for disability benefits under the applicable long-term
disability  plan  maintained by the Company (or any  subsidiary)  or, if no such
plan applies,  which would qualify the Participant for disability benefits under
the Federal Social Security System.

         (h) "Exchange Act" shall mean the  Securities  Exchange Act of 1934, as
amended.  References  to any  provision of the  Exchange Act or rule  thereunder
shall include any successor provisions or rules.

         (i) "Non-Stock-Denominated Deferral Account" shall mean the accounts or
sub-accounts  established and maintained by the Company for specified  deferrals
made by a Participant pursuant to Section 6 hereof.

         (j)  "Non-Qualified  Option" means an option or right to purchase Stock
granted to the  Participant  by the  Company  pursuant to a  compensatory  plan,
program or other such  arrangement  and such option or right does not constitute
an "Incentive Stock Option" within the meaning of Section 422 of the Code.

         (k)  "Participant"  shall  mean  any  employee  of the  Company  or any
subsidiary who is designated by the Committee as eligible to participate in this
plan and who makes an election to participate in the Plan.

         (l) "Restricted  Stock Award" shall mean awards granted pursuant to the
Company's  Amended and  Restated  1998  Recognition  and  Retention  Plan or any
similar and/or successor plan.

         (m) "Retirement" shall mean voluntary termination by the Participant in
accordance with the Company's retirement  policies,  including early retirement,
generally applicable to their salaried employees.

         (n) "Stock" shall mean the Common Stock,  with a par value of $0.01 per
share,  of Staten  Island  Bancorp,  Inc. or any other equity  securities of the
Company designated by the Committee.

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         (o)  "Stock-Denominated  Awards" shall mean a Non-Qualified  Option,  a
Restricted  Stock  Award or similar  type of award  which is  determined  by the
Committee to be appropriate for deferral under the terms of this Plan.

         (p)  "Stock-Denominated  Deferral  Account"  shall mean the accounts or
sub-accounts  established and maintained by the Company for specified  deferrals
made by a Participant pursuant to Section 7 hereof.

         (q) "Trust" shall mean the trust or trusts  established  by the Company
pursuant Sections 6 and 7 hereof.

         (r) "Trustee(s)" shall mean the trustee(s) of the Trust(s).

         (s) "Trust Agreement" shall mean the agreement(s)  entered into between
the Company and the Trustee(s), as amended or restated from time to time.

         (t)  "Valuation  Date"  shall  mean the close of  business  on the last
business day of each calendar  quarter;  provided  however,  that in the case of
termination  of  employment  for  reasons  other  than   Retirement,   death  or
Disability,  the Valuation Date shall mean the close of business on the last day
of business of the month in which  employment  terminates,  and in the case of a
Change in Control of the Company, the Valuation Date shall be the effective date
of such Change in Control.

         3.       Administration.

         (a) Committee  Authority.  The Committee  shall  administer the Plan in
accordance with its terms and shall have all powers necessary to accomplish such
purpose,  including  the power and authority to construe and interpret the Plan,
to define the terms used  herein,  to  prescribe,  amend and  rescind  rules and
regulations, agreements, forms and notices relating to the administration of the
Plan,  and to make all  other  determinations  necessary  or  advisable  for the
administration of the Plan.

         (b) Delegation of Duties; Powers. The Committee may delegate its duties
and responsibilities  hereunder, as it deems reasonable and appropriate,  to the
Administrator.   If  an  Administrator  is  appointed  by  the  Committee,  such
Administrator  shall  serve at the will of, and may be removed  (with or without
cause) by the Committee.  Any actions of the Committee or the Administrator with
respect to the Plan shall be conclusive and binding upon all persons  interested
in the Plan, except that any action of the Administrator  will not be binding on
the  Committee.  The Committee  and  Administrator  may each appoint  agents and
delegate thereto powers and duties under the Plan,  except as otherwise  limited
by the Plan.


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         (c)  Limitation  of  Liability.  Each member of the  Committee  and the
Administrator  shall be entitled to, in good faith,  rely or act upon any report
or other information furnished to him or her by any officer or other employee of
the Company or any subsidiary,  the Company's  independent public accountants or
any compensation  consultant,  legal counsel, or other professional  retained by
the Company to assist in the  administration  of the Plan. To the maximum extent
permitted  by law,  no member of the  Committee  or the  Administrator,  nor any
person to whom  ministerial  duties have been delegated,  shall be liable to any
person for any action taken or omitted in connection with the interpretation and
administration  of the Plan. To the maximum extent permitted by law, the Company
shall indemnify the members of the Committee and the  Administrator  against any
and all claims, losses, damages, expenses,  including any counsel fees and costs
incurred by them,  and any  liability,  including any amounts paid in settlement
with their approval, arising from their action or failure to act.

         4.  Participation.  The Administrator will notify each person of his or
her  participation  or  eligibility  to participate in the Plan not less than 30
days  (or  such  lesser  period  as may be  reasonable  and  practicable  in the
circumstances) prior to any deadline for filing an election form.

         5.       Deferrals.

         (a) Deferrals. A Participant may elect to defer taxable compensation or
awards which may be in the form of cash or Stock to be received from the Company
or a subsidiary,  including salary,  annual incentive awards,  Stock-Denominated
Awards  and  taxable  compensation  payable  under  other  plans  and  programs,
employment  agreements or other  arrangements or as designated by the Committee;
provided  however,  that a Participant  may only defer,  with respect to a given
year, receipt of only that portion of the Participant's salary, annual incentive
awards,  Stock-Denominated  Awards and compensation  payable under all plans and
programs,  employment  agreements  or other  arrangements  that exceeds the FICA
maximum taxable wage base plus the amount  necessary to satisfy Medicare and all
other payroll taxes (other than Federal,  state or local income tax withholding)
imposed on the wages of such Participant from the Company and its  subsidiaries.
In addition to such  limitation,  and any terms and  conditions  of deferral set
forth under plans and programs, employment agreements or other such arrangements
from which  receipt of  compensation  or awards is deferred,  the  Committee may
impose  limitations on the amounts  permitted to be deferred and other terms and
conditions of deferral under the Plan. Any such limitations, and other terms and
conditions of deferral, shall be set forth in the rules relating to the Plan, or
election forms,  other forms, or instructions  published by the Committee and/or
the  Administrator.  In addition,  in the event that a Participant is a "covered
employee"  for  purposes  of Section  162(m) of the Code and such  Participant's
applicable employee remuneration in a particular tax year exceeds the limitation
as specified in Section  162(m) of the Code, the Committee may request that such
Participant defer the payment,  in accordance with the Plan, of all or a portion
of the Participant's compensation and awards to be received under such plans and
programs,  employment  agreements and  arrangements of the Company to the extent
necessary  to avoid the  payment of employee  remuneration  for such tax year in
excess of the Section 162(m) limit.

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         (b) Elections.  Once an election form, properly completed,  is received
by the Company, such election of the Participant shall be irrevocable;  provided
however, that the Committee and/or Administrator may, in its discretion,  permit
a  Participant  to elect to increase the amount to be deferred and credited to a
Deferral  Account by filing a later  election  form;  provided,  that such later
election  form is received by the  Committee  prior to the  applicable  election
deadline  pursuant to Section 5(b)  hereof.  Furthermore,  upon a  Participant's
initial  deferral  election,  such  Participant  shall  also elect the number of
installments  in which the  settlement  of his or her Deferral  Account shall be
completed.  An election to change a  Participant's  settlement  election must be
made, in writing,  while the  Participant is an active employee and prior to the
commencement of  distribution.  However,  the change shall not become  effective
until the one (1) year  anniversary of such election,  provided the  Participant
remains an active  employee of the Company or its  subsidiary for the entire one
(1) year period.

         (c) Date of  Election.  An  election  to defer  compensation  or awards
hereunder must be received by the  Administrator  prior to the date specified by
the  Administrator;  provided  however,  that unless  otherwise  approved by the
Committee,  any  elections  to defer (i) salary,  cash  compensation  and annual
incentive  awards shall be made on or prior to the December  31st  preceding the
calendar year in which such income shall be earned, (ii) Restricted Stock Awards
shall be made on or prior to the December  31st  preceding  the calendar year in
which the Restricted Stock Awards vest; and (iii) Non-Qualified Options shall be
made at least six (6) months  prior to the  exercise  of such  option.  Under no
circumstances  may a  Participant  defer  compensation  or  awards  to which the
Participant has already attained, at the time of deferral, a legally enforceable
right to receive such compensation or awards.

         6. Deferral Accounts For  Non-Stock-Denominated  Awards.  The following
provisions will apply to Deferral  Accounts other than those  established  under
Section 7:

         (a)    Establishment;     Crediting    of    Amounts    Deferred.     A
Non-Stock-Denominated  Deferral Account will be established for each Participant
for any deferrals made by a Participant hereunder. The amount of compensation or
awards deferred with respect to each Non-Stock-Denominated Deferral Account will
be credited to such account as of the date on which such amounts would have been
paid to the  Participant  but for  deferral  hereunder.  Amounts  credited  to a
Non-Stock-Denominated  Deferral  Account  shall be deemed to be invested in such
hypothetical  investment  vehicles as selected by the Participant  from the list
authorized  by the  Committee  pursuant to Section 6(b)  hereof.  The amounts of
hypothetical  income and appreciation and depreciation in value of such accounts
will be  credited  and  debited  to such  accounts  from  time to  time.  Unless
otherwise    determined   by   the    Committee,    amounts    credited   to   a
Non-Stock-Denominated   Deferral  Account  shall  be  deemed  invested  in  such
hypothetical  investment  vehicles  within five (5) business days  following the
effective date of the deferral.

         (b) Hypothetical Investment Vehicles. The Committee shall establish one
or more  hypothetical  investment  vehicles  under  this  Plan and may add to or
change or discontinue any hypothetical  investment  vehicle included in the list
of available hypothetical investment vehicles in its discretion.

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         (c)  Allocation  and  Reallocation  of  Hypothetical   Investments.   A
Participant may allocate  amounts  credited to his or her  Non-Stock-Denominated
Deferral  Account  to  one  or  more  of the  hypothetical  investment  vehicles
authorized   under  the  Plan.   Subject  to  the  rules   established   by  the
Administrator,  a  Participant  may  reallocate  amounts  credited to his or her
Non-Stock-Denominated Deferral Account (to be effective as of the Valuation Date
immediately  following  the  Participant's  election)  to one or  more  of  such
hypothetical  investment vehicles, by filing with the Administrator a notice, in
such form as may be specified by the Administrator,  not later than the 15th day
of the month preceding such Valuation Date. The Committee or  Administrator  may
restrict  allocations or reallocations by specified  Participants into or out of
specified  investment  vehicles or specify minimum amounts that may be allocated
or reallocated by  Participants;  however,  any such  allocation or reallocation
shall be made in accordance  with all applicable  provisions of the Exchange Act
and the  regulations  promulgated  thereunder,  including  but not  limited  to,
Section 16(b) and the regulations thereunder.

         (d) Investment  Return.  In order to simulate an investment  return for
the amounts held in each Participant's  Non-Stock-Denominated  Deferral Account,
the  account  balance  shall be reduced  for the  reasonable  transaction  costs
associated  with the  Participant's  investment  directions  and be  adjusted to
recognize the hypothetical  income,  appreciation and depreciation  generated by
the hypothetical investments that the Non-Stock-Denominated  Deferral Account is
deemed to be  invested  in.  Furthermore,  the amounts of  hypothetical  income,
appreciation and depreciation  credited to each  Non-Stock-Denominated  Deferral
Account  shall be reduced  for the  hypothetical  tax  liability  created by the
generation of such income,  appreciation and depreciation.  The hypothetical tax
liability shall be determined by the Committee or the  Administrator,  based on,
among other factors, the amounts, if any, of increased tax liability incurred by
the Company as a result of the  implementation  of this Plan and any increase in
the Company's taxable income resulting from investment activity  hereunder.  The
reasonable  transaction  costs  shall  be  determined  by the  Committee  or the
Administrator,  based on, among other factors,  the estimated  transaction costs
associated with an investment similar to the one directed by the Participant.

         (e) Trusts. The Committee may, in its discretion, establish one or more
Trusts  and  deposit  therein  amounts of cash,  Stock,  or other  property  not
exceeding  the  amount  of  the  Company's   obligations  with  respect  to  the
Participants' Non-Stock-Denominated Deferral Account established under Section 6
hereof.

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         7.       Deferral Accounts For Stock-Denominated Awards.

         (a)  Establishment.  Subject to any terms and conditions imposed by the
Committee,  Participants may elect to defer, under the Plan, amounts which would
otherwise  be  taxable  income of a  Participant  as a result  of the  exercise,
earning,  vesting,  or such  similar  event with  respect  to  Stock-Denominated
Awards.  In  connection  with such  deferral  of a  Stock-Denominated  Award,  a
Stock-Denominated Deferral Account shall be established for such Participant. On
terms determined by the Committee, the Stock-Denominated  Deferral Account will,
as of the  date  that  taxable  income  from  a  Stock-Denominated  Award  would
otherwise be  recognized  by a  Participant,  be credited with a number of share
units  corresponding to the number of shares of Stock  represented in the amount
of  Stock-Denominated  Award  being  deferred  hereunder.  With  respect  to any
fractional  shares,  the Committee or the  Administrator may pay such fractional
shares   to   the   Participant   in   cash   or   credit   the    Participant's
Non-Stock-Denominated  Deferral  Account with such amount in lieu of  depositing
such fractional shares into the Stock-Denominated Deferral Account.

         (b) Investment  Return.  Hypothetical  appreciation and depreciation in
value of the  Stock-Denominated  Deferral  Account  shall be equal to the actual
appreciation  and  depreciation of the Stock.  Cash dividends and  distributions
with respect to share units in the  Stock-Denominated  Deferral Account shall be
credited to a Participant's Non-Stock-Denominated Deferral Account.

         (c) Allocation of  Hypothetical  Investment.  Stock-Denominated  Awards
deferred  pursuant to this Section 7 shall  continuously  be deemed  invested in
Stock share units until  settlement of the  Stock-Denominated  Deferral  Account
pursuant  to  Section 8 hereof  and the  Participant  shall not be  entitled  to
reallocate Stock-denominated deferrals into any other hypothetical investments.

         (d) Trusts. The Committee may, in its discretion, establish one or more
Trusts (including  sub-accounts under such Trusts),  and deposit therein amounts
of cash,  Stock,  or other  property not  exceeding  the amount of the Company's
obligations with respect to a Participants'  Stock-Denominated  Deferral Account
established under Section 7.

         8.       Settlement of Deferral Accounts.

         (a) Form of Payment. The Company shall settle a Participant's  Deferral
Account, and discharge all of its obligations to pay deferred compensation under
the Plan with respect to such  Deferral  Account,  by payment of cash, or in the
discretion of the Committee, by delivery of Stock.

         (b) Forfeited Awards. To the extent that a  Stock-Denominated  Award is
forfeited  pursuant  to the terms  and  conditions  of  another  plan,  program,
employment  agreement or other such  arrangement,  the Participant  shall not be
entitled  to the  value  of  such  Stock  and  other  property  related  thereto
(including without limitation, dividends, income and distributions thereon). Any
Stock-Denominated  Award deferred hereunder and forfeited by a Participant shall
be returned to the Company.

         (c) Timing of Payments.  Payments in settlement  of a Deferral  Account
shall be made as soon as practicable after the date or dates (including upon the
occurrence of specified events),  and in such number of installments,  as may be
directed by the  Participant  in his or her election  relating to such  Deferral
Account(s),  or  earlier  in the  event  of  termination  of  employment  by the
Participant in the following circumstances:

         (i)      In the event of  termination  of employment  for reasons other
                  than  Retirement or  Disability,  a single lump sum payment in
                  settlement  of any  Deferral  Account  (including  a  Deferral
                  Account with respect to which one or more installment payments
                  have  previously  been  made)  shall  be made as  promptly  as
                  practicable  following the Valuation  Date,  unless  otherwise
                  determined by the Administrator; or

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         (ii)     In the event of a Change in Control, payments in settlement of
                  any  Stock-Denominated  Deferral Account (including a Deferral
                  Account with respect to which one or more installment payments
                  have  previously  been made) shall be made within fifteen (15)
                  business days  following the effective  date of such Change in
                  Control.

         (d) Financial  Emergency and Other  Payments.  Other  provisions of the
Plan (except Section 9)  notwithstanding,  if, upon the written application of a
Participant,  the  Committee  determines  that the  Participant  has a financial
emergency of such substantial  nature and beyond the  individual's  control that
payment  of  amounts  previously  deferred  under  the  Plan is  warranted,  the
Committee may direct the payment to the  Participant  of all or a portion of the
balance of a Deferral  Account and the time and manner of such payment,  and the
Committee may direct such payments in other circumstances if, in the exercise of
its  independent   judgment,   it  determines  that  circumstances   beyond  the
individual's control warrant such action.

         9.  Provisions  Relating to Section 16 of the  Exchange Act and Section
162(m) of the Code.

         (a)  Compliance  with Section 16. With respect to a Participant  who is
then subject to the reporting requirements of Section 16(a) of the Exchange Act:

         (i)      Any function of the Committee  under the Plan relating to such
                  Participant shall be performed solely by the Committee, if and
                  to the  extent  required  to  ensure  the  availability  of an
                  exemption  under Rule 16b-3 or exclusion  under Rule  16a-1(c)
                  for such Participant with respect to the Plan.

         (ii)     Participants may not reallocate amounts credited to any Stock-
                  Denominated Deferral Account established pursuant to Section 7
                  hereof.

         (iii)    To the extent necessary so that  transactions by and rights of
                  such a Participant  under the Plan are excluded from reporting
                  under Rule 16a-1(c) (unless acknowledged by the Participant in
                  writing  with  respect to a  specified  transaction  not to be
                  excluded), if any provision of this Plan or any rule, election
                  form or other form,  or  instruction  does not comply with the
                  requirements   of  such  rule  as  then   applicable  to  such
                  transaction or right under the Plan,  such provision  shall be
                  construed or deemed amended to the extent necessary to conform
                  to such requirements.

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         (b)  Compliance  with  Code  Section  162(m).  It is the  intent of the
Company that any compensation (including any award) deferred under the Plan by a
person who is, with respect to any year of  settlement,  deemed by the Committee
to be a "covered  employee"  within the meaning of Code  Section  162(m) and the
regulations  thereunder,   which  compensation   constitutes  either  "qualified
performance-based  compensation"  within the meaning of Code Section  162(m) and
the  regulations  thereunder  or  compensation  not  otherwise  subject  to  the
limitation on deductibility under Section 162(m) and the regulations thereunder,
shall not, as a result of deferral  hereunder,  become compensation with respect
to which the Company in fact would not be entitled to a tax deduction under Code
Section 162(m) and the regulations  thereunder.  Accordingly,  unless  otherwise
determined by the Committee,  if any  compensation  would become so disqualified
under  Section  162(m) and the  regulations  thereunder  as a result of deferral
hereunder,  the terms of such deferral  shall be  automatically  modified to the
extent  necessary  to ensure  that the  compensation  would not,  at the time of
settlement, be so disqualified.

         10.  Statements.  The  Administrator  will furnish  statements  to each
Participant   reflecting  the  amount  credited  to  a  Participant's   Deferral
Account(s)  and the  transactions  thereof  not less  frequently  than once each
calendar year.

         11.  Sources  of  Stock:  Limitation  on  Amount  of  Stock-Denominated
Deferrals.  If Stock is deposited under the Plan in a Trust, pursuant to Section
7 hereof,  in  connection  with a deferral  of a  Stock-Denominated  Award under
another plan,  program, or other such arrangement that provides for the issuance
of Stock,  the Stock so deposited  shall be deemed to have  originated  from and
shall be counted  against the number of shares  reserved  under such other plan,
program  or other  arrangement.  Stock  placed in such a Trust and  subsequently
forfeited  by a  Participant  shall be released by the Trust and be treated as a
failed award for purposes of the other plan,  program,  or arrangement which the
Stock-Denominated Award originated.

         12.  Amendment/Termination.  The  Committee  may, with  prospective  or
retroactive effect, amend, alter, suspend, discontinue, or terminate the Plan at
any time without the consent of Participants, stockholders, or any other person;
provided  however,  that,  without the consent of a Participant,  no such action
shall materially or adversely affect the rights of such Participant with respect
to any rights to  receive  payment of  amounts  credited  to such  Participant's
Deferral Account(s).  Notwithstanding the foregoing, the Committee,  may, at any
time  and  in  its  sole  discretion,  terminate  the  Plan  and  distribute  to
Participants the amounts credited to their Deferral Accounts. Upon the effective
date of Change and Control, this Plan shall terminate.

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<PAGE>
         13.      General Provisions.

         (a) Limits on  Transfer  of  Awards.  Other than by will or the laws of
descent and  distribution,  no right,  title or interest of any kind in the Plan
shall be  transferable  or assignable by a Participant or his or her Beneficiary
or be subject to alienation, anticipation, encumbrance, garnishment, attachment,
levy,  execution or other legal or equitable process,  nor subject to the debts,
contracts, liabilities or engagements, or torts of any Participant or his or her
Beneficiary.  Any attempt to alienate, sell, transfer,  assign, pledge, garnish,
attach  or take any  other  action  subject  to legal or  equitable  process  or
encumber or dispose of any interest in the Plan shall be void.

         (b) Receipt and Release.  Payments (in any form) to any  Participant or
Beneficiary in accordance  with the provisions of the Plan shall,  to the extent
thereof,  be in full  satisfaction of all claims for the  compensation or awards
deferred and relating to the Deferral  Account(s)  to which the payments  relate
against  the  Company  or  any  subsidiary  thereof,   the  Committee,   or  the
Administrator.  The Committee or the  Administrator may require a Participant or
Beneficiary,  as a condition  to a payment,  to execute a receipt and release to
such effect.

         (c) Unfunded Status of Awards; Creation of Trusts. The Plan is intended
to constitute  an "unfunded"  plan for deferred  compensation  and  Participants
shall rely solely on the unsecured promise of the Company for payment hereunder.
With  respect  to any  payment  not yet made to a  Participant  under  the Plan,
nothing  contained in the Plan shall give a Participant  any rights greater than
those of a general unsecured  creditor of the Company;  provided  however,  that
nothing  herein shall restrict or prohibit the Committee  from  authorizing  the
creation  of Trusts,  including  but not  limited to the Trusts  referred  to in
Sections  6 and 7  hereof,  or make  other  arrangements  to meet the  Company's
obligations  under the Plan,  which Trusts  and/or other  arrangements  shall be
consistent  with  the  "unfunded"  status  of the  Plan,  unless  the  Committee
otherwise determines with the consent of each affected Participant.

         (d)  Compliance.  The Company shall impose such  restrictions  on Stock
delivered to a  Participant  hereunder  and any other  interest  constituting  a
security as it may deem  advisable in order to comply with the Securities Act of
1933, as amended,  the requirements of the Exchange Act, the requirements of the
New York Stock  Exchange or any other  stock  exchange  or  automated  quotation
system upon which the Stock is then listed or quoted,  any state securities laws
applicable to such a transfer,  any  provisions of the Company's  Certificate of
Incorporation or Bylaws,  or any other law,  regulation,  or binding contract to
which the Company is a party.


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<PAGE>
         (e) Other  Participant  Rights.  No  Participant  shall have any of the
rights or privileges of a stockholder  of the Company under the Plan,  including
as a result of crediting  of Stock  equivalents  or other  amounts to a Deferral
Account,  or the  creation of any Trust and the  deposit of such Stock  thereof,
except  at such time as Stock  may be  actually  delivered  in  settlement  of a
Deferral Account. No provision of the Plan or transaction hereunder shall confer
upon any  Participant  any right to be employed  by the Company or a  subsidiary
thereof,  or to  interfere  in any  way  with  the  right  of the  Company  or a
subsidiary  to increase or decrease  the amount of any  compensation  payable to
such Participant.  Subject to the limitations set forth in Section 13(a) hereof,
the Plan shall inure to the benefit of, and be binding upon,  the parties hereto
and their successors and assigns.

         (f) Tax  Withholding.  The  Company and any  subsidiary  shall have the
right to deduct  from  amounts  otherwise  payable in  settlement  of a Deferral
Account any sums that  Federal,  state,  local or foreign tax law requires to be
withheld with respect to such payment.  Stock or other  property may be withheld
to satisfy such  obligations  in any case where  taxation  would be imposed upon
delivery of such Stock and other property.

         (g) Payment of Legal Fees. All reasonable  legal fees and costs paid or
incurred by a Participant  pursuant to any dispute or question or interpretation
relating to this  Agreement  shall be paid or  reimbursed  by the Company if the
Participant  is  successful  on  the  merits   pursuant  to  a  legal  judgment,
arbitration or settlement.

         (h) Governing Law. The validity,  construction,  and effect of the Plan
and any  rules and  regulations  relating  to the Plan  shall be  determined  in
accordance  with the laws of the State of New  York,  without  giving  effect to
principles of conflicts of laws, and applicable provisions of federal law.

         (i) Limitation.  A Participant and his or her Beneficiary  shall assume
all risk in  connection  with  any  decrease  in  value  of his or her  Deferral
Account(s) and neither the Company, the Committee nor the Administrator shall be
liable or responsible therefor.

         (j)  Construction.  The captions and numbers  preceding the sections of
the Plan are included solely as a matter of convenience of reference and are not
to be taken as  limiting  or  extending  the  meaning  of any of the  terms  and
provisions of the Plan. Whenever  appropriate,  words used in the singular shall
include the plural or the plural may be read as the singular.

         (k) Severability.  In the event that any provision of the Plan shall be
declared illegal or invalid for any reason,  said illegality or invalidity shall
not affect the remaining  provisions  of the Plan but shall be fully  severable,
and the Plan  shall be  construed  and  enforced  as if said  illegal or invalid
provision had never been inserted herein.

         (l) Status.  The  establishment  and maintenance of, or allocations and
credits to, the Deferral  Account(s)  of any  Participant  shall not vest in any
Participant  any right,  title or interest in and to any Plan assets or benefits
except at the time or times and upon the terms and  conditions and to the extent
expressly set forth in the Plan and in accordance with the terms of the Trust.

         14.  Effective  Date.  The Plan shall be  effective  as of December 31,
1998.


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