Document:

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                           RESTRICTED STOCK AGREEMENT

        AGREEMENT, made as of October 31, 2003, between FINLAY ENTERPRISES,
INC., a Delaware corporation (the "Company"), and ___________________________
(the "Grantee").

        1. PURPOSE. The purpose of this Restricted Stock Agreement (the
"Agreement") is to provide an incentive and reward to the Grantee, who, through
employment and by the Grantee's industry and exceptional service, will continue
to contribute to the growth and development of the Company.

        2. SHARES AWARDED.

            (a) Subject to the terms of this Agreement, provided that the
Grantee is at such time employed by the Company or its or their subsidiaries,
the Company shall issue to the Grantee, on September 30, 2007 or as soon
thereafter as is reasonably practicable, ____ shares of common stock, $.01 par
value ("Common Stock"), of the Company (the "Shares"), which Shares shall be
subject to the restrictions set forth herein.

            (b) The Shares are granted pursuant to the Company's 1997 Long Term
Incentive Plan, as amended (the "Plan"). The Shares are subject to all of the
applicable provisions of the Plan which are incorporated herein by reference,
and any conflict between the terms of this Agreement and those of the Plan shall
be resolved in favor of the terms of the Plan.

            (c) Notwithstanding anything to the contrary herein contained, in
the event (i) that the Grantee's employment is terminated by reason of the
Grantee's death or Disability (as such term is defined in the Plan), or (ii)
upon the occurrence of a Change in Control (as defined in the Plan), then in any
such case, all of the Shares shall be deemed immediately vested and shall cease
to be subject to the restrictions imposed hereunder and the Shares shall be
distributed to the Grantee or his or her estate (as applicable) as promptly as
possible thereafter.

        3. CERTIFICATES.

            (a) CERTIFICATES. Upon issuance by the Company to the Grantee of
Shares in accordance with Section 2 hereof, the Company shall deliver to the
Grantee or his or her estate (as applicable) a certificate covering such Shares,
which shall be in the name of the Grantee or such estate and shall have stamped
thereon the legends set forth in Section 6 hereof.

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            (b) ADJUSTMENTS. In the event that the Company shall effect any
dividend or other distribution in the form of shares of Common Stock, or there
shall occur any recapitalization, forward or reverse split, reorganization,
merger, consolidation, spin-off, combination, repurchase, share exchange or
other similar corporate transaction or event which affects the Common Stock such
that an adjustment is appropriate in order to prevent dilution or enlargement of
the rights of the Grantee hereunder, then the Company shall, in such manner as
it may deem equitable, adjust the number and/or type of securities issuable to
the Grantee pursuant to Section 2 hereof after the effective date of such
dividend or distribution or other corporate transaction or event.

        4. STOCKHOLDERS' AND REGISTRATION RIGHTS AGREEMENTS.

        It is a condition to the grant of any Shares hereunder that the Grantee
execute and deliver to the Company, counterparts of the Amended and Restated
Stockholders' Agreement dated as of March 6, 1995 and the Registration Rights
Agreement, dated as of May 26, 1993, each as amended (respectively, the
"Stockholders' Agreement" and the "Registration Rights Agreement"), by and among
the Company, David B. Cornstein, Arthur E. Reiner and certain other parties.
Upon the Grantee's execution and delivery of such agreements, the Grantee will
be deemed to be a "Management Holder" under the Stockholders' Agreement and a
"Management Stockholder" under the Registration Rights Agreement, and as such,
the Grantee will be subject, in addition to the provisions of this Agreement, to
all of the terms, conditions and obligations of such agreements, including,
without limitation, restrictions on the transferability of the Shares (and any
other securities issued to the Grantee pursuant to Section 3(b) hereof).
Capitalized terms used but not otherwise defined herein, shall have the same
meaning as defined in the Stockholders' Agreement.

        5. RESTRICTIONS ON TRANSFER. The Grantee hereby represents and warrants
to and agrees with the Company as follows:

            (a) The Shares (and any other securities issued pursuant to Section
3(b) hereof) are being acquired by the Grantee for the Grantee's benefit and
account for investment purposes and not with a view to or for resale in
connection with a public offering and distribution thereof.

            (b) The Shares (and any other securities issued to the Grantee
pursuant to Section 3(b) hereof) will not be sold, exchanged, pledged,
hypothecated, transferred or otherwise

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disposed of by the Grantee in any manner, directly or indirectly, (i) without
registration thereof under the Securities Act of 1933, as amended, and any
applicable state "Blue Sky" laws unless an exemption from such registration is
available and, if the Company so requests, the Grantee causes counsel
satisfactory to the Company to deliver to the Company a written opinion of such
counsel in form and substance satisfactory to the Company; or (ii) in violation
of any law; or (iii) in violation of the Stockholders' Agreement or the
Registration Rights Agreement.

        6. RESTRICTIVE LEGENDS. A11 certificates representing shares issued
hereunder (and all certificates representing any other securities issued to the
Grantee pursuant to Section 3(b) hereof) shall bear restrictive legends thereon
substantially as follows:

        "THE SALE, ASSIGNMENT, TRANSFER OR OTHER DISPOSITION OF THE SECURITIES
        REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE PROVISIONS OF A
        RESTRICTED STOCK AGREEMENT DATED AS OF OCTOBER __, 2003 BETWEEN THE
        COMPANY AND THE HOLDER, AND AN AMENDED AND RESTATED STOCKHOLDERS'
        AGREEMENT DATED AS OF MARCH 6, 1995 AND A REGISTRATION RIGHTS AGREEMENT,
        DATED AS OF MAY 26, 1993, EACH AS AMENDED, BY AND AMONG THE COMPANY,
        DAVID B. CORNSTEIN, ARTHUR E. REINER AND CERTAIN OTHER PARTIES, COPIES
        OF WHICH ARE ON FILE WITH THE SECRETARY OF THE COMPANY."

        "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
        UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE
        OFFERED OR SOLD EXCEPT (i) PURSUANT TO AN EFFECTIVE REGISTRATION
        STATEMENT UNDER THE ACT, (ii) TO THE EXTENT APPLICABLE, PURSUANT TO RULE
        144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER SUCH ACT RELATING TO THE
        DISPOSITION OF SECURITIES), OR (iii) UPON THE DELIVERY BY THE HOLDER TO
        THE COMPANY OF AN OPINION OF COUNSEL, SATISFACTORY TO COUNSEL TO THE
        COMPANY, STATING THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS
        AVAILABLE."

        7. GENERAL PROVISIONS. Nothing contained in this Agreement shall confer
upon the Grantee any right to continue in the employ of the Company or shall in
any way affect the right and power of the Company to dismiss or otherwise
terminate the employment of the Grantee at any time for any reason with or
without cause. This Agreement shall be governed and construed in accordance with
the laws of the State of New York applicable to contracts entered into and to be
performed wholly within such

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State. This Agreement shall be binding upon the heirs, executors, administrators
and successors of the parties hereto.

        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.

                                            FINLAY ENTERPRISES, INC.

                                            By ---------------------------------
                                               Name: Arthur E. Reiner
                                               Title: Chairman and CEO

                                            THE GRANTEE:

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                                            Signature<PAGE>

                            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 ___________________

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