EMPLOYMENT AGREEMENT

    EMPLOYMENT AGREEMENT dated as of December 5th, 1998, by and 
between CORRECTIONAL SERVICES CORPORATION, A Delaware corporation with 
offices located at 1819 Main Street, Suite 1000, Sarasota, Florida 34236 
(the "Company") and Michael C. Garretson, residing at 5537 Sago palm 
Drive, Orlando, Florida 32819 (the "Executive").

                         W I T N E S S E T H:

    WHEREAS, the Company wishes to assure itself of the services of 
the Executive during the term of this Agreement; and
    WHEREAS, the Executive is willing to serve in the employ of the 
Company upon the terms and conditions herein provided.
    NOW, THEREFORE, the Company and the Executive, intending to be 
legally bound, hereby agree as follows:

1.  Employment.  The Company hereby employs the Executive who accepts 
employment with the Company as its Executive Vice President to 
perform duties as the Company's President may from time to time 
determine and assign to him.  The Executive shall devote all of 
his business time, attention and energy to his duties and to the 
business and affairs of the Company and shall not engage, directly 
or indirectly, in any other business, employment or occupation, 
whether or not such other business, employment or occupation is 
competitive with the business of the Company.

2.  Term.  The term of this Agreement shall commence as of January 21, 
1999 (the "Commencement Date") and shall terminate on the date 
immediately preceding the third anniversary date of the 
Commencement Date (the "Term").


<PAGE>

3.  Compensation

    3.1  As full compensation for all services to be rendered by the 
Executive to the Company pursuant to the terms of this Agreement the 
Company shall pay to the Executive a base salary of (a) $200,000 for the 
first year (b) $208,000 for the second year (c) $218,000 for the 3rd 
year.  The base salary shall be payable at such regular times and  
intervals as the Company customarily pays its employees from time to 
time.

    For the calendar year ending December 31, 1999, Executive will be 
entitled to a bonus of $100,000 providing CSC's total count of beds 
under contract exceeds the year-end total on December 31, 1998 by 3,000 
beds.

    For Calendar year ending December 31, 2000 Executive will be entitled 
to a bonus of $110,000 providing CSC's total count of beds under contact 
exceeds the December 31, 1998 total by 6,250 beds.

    For Calendar year ending December 31, 2001 Executive will be entitled 
to a bonus of $120,000 providing CSC's total count of beds under contact 
exceeds the December 31, 1998 total by 9,750 beds.

    All beds added to CSC's inventory, to include future acquisitions, 
will count towards these incentive goals except for the Youth Services 
International acquisition and any facility expansion.

    All bonuses are payable on March 1st.

<PAGE>

    3.2  The Company shall deduct from the Executive's Base Salary, 
bonus or incentive compensation any federal, state or city withholding 
taxes, social security contributions and any other amounts which may be 
required to be deducted or withheld by the Company pursuant to any 
federal, state or city laws, rules or regulations.

    3.3  The Company shall reimburse the Executive, or cause him to 
be reimbursed, for all reasonable out-of-pocket expenses incurred by him 
in the performance of his duties hereunder or in furtherance of the 
business and/or interests of the Company; provided, however, that the 
Executive shall have previously furnished to the Company an itemized 
account, satisfactory to the Company, in substantiation of such 
expenses.

    3.4  In lieu of the Executive's participation in the Company's 
health, accident and hospitalization insurance programs the Company will 
provide the Executive with disability insurance which, in the event of 
Executive's disability, will provide Executive with annualized 
disability payments equal to not less than fifty (50%) percent of the 
Executive's Base Salary.

    3.5  During the Term hereof, the Executive shall be entitled to 
an automobile allowance of seven hundred and fifty ($750.00) dollars per 
month to be applied to fuel, repairs, insurance, lease or loan payments 
and the like.  Any expenses in excess thereof shall be the 
responsibility of the Executive.

4.  Grant of Stock Options.  the Company has previously granted to 
Executive a stock option as evidenced by a Stock Option Agreement 
between the parties dated January 21st, 1996.

<PAGE>


5.  Termination

    5.1  If the Executive dies or becomes disabled during the Term, 
his Base Compensation and all other rights under this Agreement shall 
terminate at the end of the month during which death occurs or the 
Executive is deemed disabled.  For purposes of this Agreement, the 
Executive shall be deemed to be "disabled" if he has been unable to 
perform his duties for three (3) consecutive moths or an aggregate of 
five (5) months in any consecutive twelve (12) month period.

    5.2  The Company shall, in the manner described in Section 5.3 
hereof, have the right to terminate the employment of Executive under 
this Agreement and Executive shall forfeit the right to receive any and 
all further payments hereunder, other than the right to receive any 
compensation then due and payable to Executive pursuant to Section 3 
hereof to the date of termination, if Executive shall have committed any 
of the following acts of defaults:

    (A)  Executive shall have committed any material breach of any of 
the provisions or covenants of this Agreement;

    (B)  Executive shall have committed any act of gross negligence 
in the performance of his duties or obligations hereunder, 
or, without proper cause, shall have willingly refused or 
habitually neglected to perform his employment duties or 
obligations under this Agreement;

    (C)  Executive shall have committed any material act of willful 
misconduct, dishonesty or breach of trust which directly or 
indirectly causes the company or any of its subsidiaries to 
suffer any loss, fine, civil penalty, judgment, claim, 
damage or expense;


<PAGE>

    (D) Executive shall have been indicted or convicted of, or shall 
have plead guilty or nolo contendere to, a felony or 
indictable offense (unless committed in the reasonable, good 
faith belief that the Executive's actions were in the best 
interests of the Company and its stockholders and would not 
violate criminal law);

    (E) A court or other tribunal of competent jurisdiction shall 
have issued an order prohibiting the Company from employing 
Executive; or

    (F) Executive shall have violated the Company's discipline rules 
as set forth in the Company's Employee handbook, as may be 
modified from time to time at the sole discretion of the 
Company.

    5.3  If the Company elects to terminate this Agreement as set 
forth above, it shall deliver notice thereof to the Executive, 
describing with reasonable detail, the action or omission of the 
Executive constituting the act of default (the "Termination Notice"), 
and thereupon no further payments of any type shall be made or shall be 
due or payable to Executive hereunder, except as provided in the first 
sentence of Section 5.2 hereof; provided, however, with respect to any 
act of default set forth in clauses (a), (b) and (f) of Section 5.2, 
prior to any termination by the Company of Executive's employment, 
Executive shall first have an opportunity to cure or remedy such act of 
default within thirty (30) days following the Termination Notice. 

    5.4  In the event the Company merges into, consolidates with or 
otherwise reorganizes or combines (the "Merger") with another company, 
wherein immediately following such Merger, the shareholders of the 
Company prior to the Merger own either (a) less than 50% of the 
outstanding voting stock of the Company (if the Company is the survivor 
of the Merger), or (b) less than fifty (50%) percent of the outstanding 
voting stock of the surviving entity, the Executive shall have the 
right, at his option, to terminate his employment hereunder upon 90 days 

<PAGE>

advance notice ("Notice") to the Company.  Notice of Executive's 
intention to terminate his employment hereunder shall be given to the 
Company within thirty (30) day period shall result in the automatic 
lapse of such right of termination.  If Notice of termination is duly 
given by the Executive or is given at any time thereafter by the 
Company, then the Company shall pay the Executive within fifteen (15) 
days following termination an amount equal to the greater of (y) the 
Base Salary described in Paragraph 3.1 hereof through the balance of the 
term of this Agreement, or (z) the Base Salary paid to Executive during 
the year immediately preceding termination of employment, plus, within 
thirty (30) days after such information can be determined in the normal 
course, the bonus described in Paragraph 3.2 hereof shall be computed 
paid through the date of termination of Executive's employment.

6.  Restrictive Covenants

    6.1  Confidential Information: Covenant not to Disclose.  The 
Executive covenants and undertakes that he will not at any time during 
or after the termination of his employment hereunder reveal, divulge, or 
make known to any person, firm, corporation, or other business 
organization (other than the Company or its affiliates, if any), or use 
for his own account any trade secrets, or secret or confidential 
information of any kind used by the Company during his employment by the 
Company, and made known (whether or not with the knowledge and 
permission of the Company, whether or not developed, devised, or 
otherwise created in whole or in part by the efforts of the Executive, 
and whether or not a maker of public knowledge unless as a result of 
authorized disclosure) to the Executive by reason of his employment by 
the Company. The Executive further covenants and agrees that he shall 
retain such knowledge and information which he has acquired or shall 
acquire and develop during his employment respecting such trade secrets, 
and secret or confidential information in trust for the sole benefit of 
the Company, its successors and assigns.

<PAGE>

    6.2  Covenant Not to Compete: Non-Interference.

         6.2.1 The Executive covenants and undertakes that, during 
the period of his employment hereunder and for a period of two (2) 
years thereafter, he will not, without the prior written consent 
of the Company, directly or indirectly, and whether as principal, 
agent, officer, director, Executive, consultant, or otherwise, 
alone or in association with any other person, firm, corporation, 
or other business organization, carry on, or be engaged, 
concerned, or take part in, or render services to, or own, share 
in the earnings of, or invest in the stock, bonds, or other 
securities of any person, firm, corporation, or other business 
organization (other than the Company or its affiliates, if any) 
engaged in a business in the Continental United States which is 
similar to or in competition with any of the businesses carried on 
by the Company (a "Similar Business"); provided, however, that the 
Executive may invest in stock, bonds, or other securities of any 
Similar Business (but without otherwise participating in the 
activities of such Similar Business) if (i) such stock, bonds, or 
other securities are listed on any national or regional securities 
exchange or have been registered under Section 12(g) of the 
Securities Exchange Act of 1934; and (ii) his investment does not 
exceed, in the case of any class of the capital stock of any one 
issuer, 2 % of the issued and outstanding shares, or in the case 
of bonds or other securities, 2 % of the aggregate principal 
amount thereof issued and outstanding.

         6.2.2  The Executive covenants and undertakes that during 
the period of his employment hereunder and for a period of two (2) 
years thereafter he will not, whether for his own account or for 
the account of any other person, firm, corporation or other 
business organization, interfere with the Company's relationship 
with, or endeavor to entice away from the Company, any person, 
firm, corporation or other business organization who or which at 

<PAGE>

any time during the term of the Executive's employment with the 
Company was an employee, consultant, agent, supplier, or a 
customer of, or in the habit of dealing with, the Company.

         6.2.3  If any provision of this Article 6.2 is held by any 
court of competent jurisdiction to be unenforceable because of the 
scope, duration or area of applicability, such provision shall be 
deemed modified to the extent the court modifies the scope, 
duration or area of applicability of such provision to make it 
enforceable.

    6.3  Covenant to Report.

         6.3.1 The Executive shall promptly communicate and disclose
to the Company all intellectual property, including, without 
limitation, inventions, discoveries, improvements and new 
writings, in any form whatsoever ("Intellectual Property"), 
including, without limitation, all software, programs, routines, 
techniques, procedures, training aides and instructional manuals 
conceived, developed or made by him during his employment by the 
Company, whether solely or jointly with others, and whether or not 
patentable or copyrightable, (i) which relate to any matters or 
business of the type carried on or being developed by the Company, 
or (ii) which result from or are suggested by any work done by him 
in the course of his employment by the Company. The Executive 
shall also promptly communicate and disclose to the Company all 
other data obtained by him concerning the business or affairs of 
the Company in the course of his employment by the Company.

         6.3.2  All written materials, records and documents made by
the Executive or coming into his possession during the Term 
concerning the business or affairs of the Company shall be the 
sole property of the Company; and, upon the termination of the 
Term or upon the request of the Company during the Term, the 

<PAGE>

Executive shall promptly deliver the same to the Company. The 
Executive agrees to render to the Company such reports of the 
activities undertaken by the Executive or conducted under the 
Executive's direction pursuant hereto during the Term as the 
Company may request.

         6.3.3  The Executive will assign to the Company all rights in 
and to the Intellectual Property and will assist the Company or 
its designee during or subsequent to his employment, at the 
Company's sole expense, in filing patent and/or copyright 
applications on, and obtaining for the Company's benefit, patents 
and/or copyrights for, such Intellectual Property in any and all 
countries, and will assign to the Company all such patent and/or 
copyright applications, all patents and/or copyrights which may 
issue thereon, said Intellectual Property to be and remain the 
sole and exclusive property of the Company or its designee whether 
or not patented and/or copyrighted.

7.  Injunction. It is acknowledged and agreed by the Executive that a 
breach or violation by the Executive of any of the covenants or 
agreements contained herein may cause irreparable harm and damage to the 
Company, the monetary amount of which may be virtually impossible to 
ascertain. As a result, the Executive acknowledges and agrees that the 
Company shall be entitled to an injunction, without posting bond or 
security in connection therewith, from any court of competent 
jurisdiction enjoining and restraining any breach or violation of any of 
the restrictive covenants contained in Article 6 of this Agreement by 
the Executive, either directly or indirectly, and that such right to an 
injunction shall be cumulative and in addition to such other rights or 
remedies the Company may possess. Nothing contained in this Article 7 
shall be construed to prevent the Company from seeking and recovering 
from the Executive damages sustained as a result of any breach or 
violation by the Executive of any of the covenants or agreements 
contained herein, and in the event of any such breach or violation, the 
Company may avail itself of all remedies available both in law and at 
equity.


8.  Compliance with Other Agreements. The Executive represents and 
warrants to the Company that the execution of this Agreement by him and 
the performance of his obligations hereunder will not, with or without 
the giving of notice, the passage of time or both, conflict with, result 
in the breach of any provision of or the termination of, or constitute a 
default under, any agreement to which the Executive is a party or by 
which the Executive is or may be bound.

9.  Miscellaneous.

    9.1  Notices. All notices and other communications hereunder 
shall be in writing and shall be deemed given if delivered personally or 
mailed, postage prepaid, by certified or registered mail (return receipt 
requested) to the parties at the following address or at such other 
address for a party as shall be specified by such party by like notice:

If to the Company:

     Correctional Services Corporation
     1819 Main Street, Suite 1000
     Sarasota  FL 34236
     Attention:  President

If to the Executive:

     Michael C. Garretson 
     5537 Sago Palm Drive
     Orlando, FL 32819

<PAGE>

    9.2  Benefit. This Agreement shall be binding upon and inure to 
the benefit of the respective parties hereto and their legal 
representatives, successors and assigns. Insofar as the Executive is 
concerned, this Agreement being personal, cannot be assigned.

    9.3  Validity. The invalidity or unenforceability of any 
provisions hereof shall in no way affect the validity or enforceability 
of any other provision.

    9.4  Entire Agreement. The Agreement constitutes the entire 
Agreement between the parties with respect to the subject matter hereof 
and supersedes all prior agreements between them. It may only be changed 
or terminated by an instrument in writing signed by both parties. The 
covenants of the Executive contained in Article 8 of this Agreement 
shall survive the termination of Executive's employment.

    9.5  Florida Law to Govern. This Agreement shall be governed by, 
construed and interpreted in accordance with the laws of the State of 
Florida.

    9.6  Corporate Action. The execution and delivery of this 
Agreement by the Company has been authorized and approved by all 
requisite corporate action. /

    9.7  Waiver of Breach. The failure of either party to insist on 
strict adherence to any provision of this Agreement on any occasion 
shall not be considered a waiver or deprive that party of the right 
thereafter to insist upon strict adherence to that provision or any 
other provision of this Agreement. The waiver of any provision of this 
Agreement must be in a writing signed by the party waiving such 
compliance.

    9.8  Counterparts. This Agreement may be executed in one or more 
counterparts, each of which shall be deemed an original, and all of 
which, when taken together, shall constitute one and the same 
instrument.

<PAGE>

    9.9  Paragraph Headings. Paragraph headings are inserted herein for 
convenience only and are not intended to modify, limit or alter the 
meaning of any provision of this Agreement.

IN WITNESS WHEREOF, the parties hereto have set their hands and executed 
this Agreement as of the day and year first above written.

CORRECTIONAL SERVICES CORPORATION


By:    /s/ James F. Slattery
     -----------------------
        James F. Slattery
        President


By:    /s/ Michael C. Garretson
     --------------------------
        Michael C. Garretson
        Executive Vice President