Document:

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EXHIBIT 10.7

                                PLEDGE AGREEMENT

                  This PLEDGE AGREEMENT  ("Pledge  Agreement") is made as of the
1st day of  January,  2000,  by and between  THE LONG  ISLAND  SAVINGS  BANK FSB
EMPLOYEE STOCK OWNERSHIP PLAN TRUST, acting by and through its Trustee, CG TRUST
COMPANY,  a  banking  corporation  organized  under  the  laws  of the  Illinois
("Pledgor"),  and  ASTORIA  FINANCIAL  CORPORATION  ("Pledgee"),  a  corporation
organized and existing under the laws of the State of Delaware.

                              W I T N E S S E T H :
                              --------------------

                  WHEREAS, this Pledge Agreement is being executed and delivered
to the Pledgee  pursuant to the terms of An Amended and Restated Loan  Agreement
of even date  herewith  ("Loan  Agreement"),  by and between the Pledgor and the
Pledgee;

                  NOW,  THEREFORE,  in  consideration  of the mutual  agreements
contained  herein  and in the Loan  Agreement,  the  parties  hereto  do  hereby
covenant and agree as follows:

                  Section 1. Definitions.  The following definitions shall apply
for  purposes  of this Pledge  Agreement,  except to the extent that a different
meaning is plainly indicated by the context;  all capitalized terms used but not
defined herein shall have the respective  meanings  assigned to them in the Loan
Agreement:

                  (a) "Collateral" shall mean the Pledged Shares and the Pledged
         Assets and, subject to section 5 hereof, and to the extent permitted by
         applicable  law, all rights with respect  thereto,  and all proceeds of
         such Pledged Shares, Pledged Assets and rights.

                  (b) "Event of  Default"  shall  mean an event so defined in
         the Loan Agreement.

                  (c) "Liabilities"  shall  mean  all  the  obligations  of the
         Pledgor  to the  Pledgee,  howsoever  created,  arising  or  evidenced,
         whether direct or indirect,  absolute or  contingent,  now or hereafter
         existing,  or due or to become due,  under the Loan  Agreement  and the
         Promissory Note.

                  (d) "Pledged Assets" means all assets of the Borrower pledged,
         as of  January 1,  2000,  as  collateral  security  for the  Borrower's
         performance  of its  obligations  under  that  certain  Loan  Agreement
         between the Borrower and the Lender dated April 14, 1994, excluding any
         Pledged Shares.

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                  (e)  "Pledged  Shares"  shall  mean all the  shares  of common
         stock,  par value $ .01 per  share,  of Astoria  Financial  Corporation
         issued in exchange for shares of common  stock of Long Island  Bancorp,
         Inc.  pursuant  to the  acquisition  of Long  Island  Bancorp,  Inc. by
         Astoria  Federal  Corporation,  which  shares of  common  stock of Long
         Island Bancorp, Inc. were purchased by the Pledgor with the proceeds of
         the  loan  made by the  Pledgee  to the  Pledgor  pursuant  to the Loan
         Agreement   dated  April  14,  1994,  but  excluding  any  such  shares
         previously released pursuant to section 4.

                  Section 2. Pledge.  To secure the payment of and performance
of all the  Liabilities,  the Pledgor hereby pledges to the  Pledgee,  and
grants to the Pledgee a security interest in and lien upon the Collateral.

                  Section 3. Representations and Warranties of the Pledgor.
The Pledgor represents, warrants, and covenants to the Pledgee as follows:

                  (a) to the actual  knowledge  of the Trustee,  the  execution,
         delivery and  performance of this Pledge  Agreement and the pledging of
         the Collateral hereunder do not and will not conflict with, result in a
         violation of, or constitute a default under any agreement  binding upon
         the Pledgor;

                  (b) the  Pledged  Shares are and will  continue to be owned by
         the Pledgor  free and clear of any liens or rights of any other  person
         except the lien  hereunder and under the Loan Agreement in favor of the
         Pledgee, and the security interest of the Pledgee in the Pledged Shares
         and the proceeds thereof is and will continue to be prior to and senior
         to the rights of all others;

                  (c) to  the  actual  knowledge  of the  Trustee,  this  Pledge
         Agreement is the legal, valid and binding obligation of the Pledgor and
         is enforceable against the Pledgor in accordance with its terms;

                  (d) the Pledgor shall,  from time to time, upon request of the
         Pledgee,  promptly  deliver to the Pledgee such  financing  statements,
         stock powers, proxies, and similar documents,  satisfactory in form and
         substance to the Pledgee, with respect to the Collateral as the Pledgee
         may reasonably request; and

                  (e) subject to the first sentence of section 4(b), the Pledgor
         shall not, so long as any Liabilities are  outstanding,  sell,  assign,
         exchange, pledge or otherwise transfer or encumber any of its rights in
         and to any of the Collateral.

                  Section 4. Eligible Collateral.

                  (a) As used herein the term "Eligible  Collateral"  shall mean
that amount of Collateral  which has an aggregate fair market value equal to the
amount by which the Pledgor is in default  (without  regard to any amounts owing
solely as the result of an acceleration of the Loan

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Agreement) or such lesser  amount of  Collateral as may be required  pursuant to
section 12 of this Pledge Agreement.

                  (b)  The  Collateral   shall  be  released  from  this  Pledge
Agreement in a manner conforming to the requirements of Treasury  Regulation ss.
54.4975-7(b)(8)(i), as  the  same  may  be  from  time  to  time   amended  or
supplemented.
In the  event of a  termination  of the ESOP or the  occurrence  of a Change  in
Control after December 31, 2009, all Pledged Shares shall be forthwith  released
from this Pledge  Agreement and shall not be applied to satisfy any Liabilities.
In the event of a Change in Control prior to January 1, 2010, all Pledged Shares
in excess of the number  determined under the following table shall be forthwith
released  from this  Pledge  Agreement  and shall not be applied to satisfy  any
Liabilities:

    YEAR OF    PLEDGED         YEAR OF          PLEDGED
     CHANGE    SHARES          CHANGE           SHARES
       IN                        IN
    CONTROL                    CONTROL
      2001     1,708,900        2006            1,611,725
      2002     1,689,463        2007            1,592,288
      2003     1,670,026        2008            1,572,851
      2004     1,650,589        2009            1,553,414
      2005     1,591,152

To the extent that the  Collateral  consists of assets other than or in addition
to  Pledged  Shares,  the  provisions  of  such  Regulations  shall  be  applied
separately  to each  class of  security  or each  class  or other  type of asset
included in the Collateral.  Subject to such  Regulations,  the Pledgee may from
time to time, after any Default or Event of Default, and without prior notice to
the Pledgor,  transfer all or any part of the Eligible  Collateral into the name
of the Pledgee or its nominee,  with or without  disclosing  that such  Eligible
Collateral  is subject to any rights of the  Pledgor  and may from time to time,
whether  before or after any of the  Liabilities  shall  become due and payable,
without  notice to the Pledgor,  take all or any of the following  actions:  (i)
notify the parties  obligated  on any of the  Collateral  to make payment to the
Pledgee of any amounts due or to become due thereunder, (ii) release or exchange
all or any part of the  Collateral,  or  compromise  or  extend or renew for any
period  (whether or not longer than the original  period) any obligations of any
nature of any party with respect thereto, and (iii) take control of any proceeds
of the Collateral.

                  Section 5. Delivery; Further Assurances.

                  (a) The Pledgor  shall  deliver to the Pledgee upon  execution
of this Pledge  Agreement an assignment by the Pledgor of all the Pledgor's
rights to and interest in the Collateral.

                  (b) So long as no Default or Event of Default shall have
occurred and be  continuing,  (i) the Pledgor  shall be entitled to exercise
any and all voting and other rights pertaining to the Collateral or any part
thereof for any purpose not inconsistent with the terms of this Pledge
Agreement, and (ii) the Pledgor shall be entitled to receive any and all cash
dividends or other

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distributions paid in respect of the Collateral.

                  (c) For so long as this Pledge Agreement shall be in effect,
the Pledgor  shall  take such other  actions  and  execute  and  deliver  such
other documents  as the  Pledgee  may  reasonably  request  in order to secure
for the Pledgee's  benefit a perfected first priority lien and security
interest in any or all of the Collateral under the New York Uniform  Commercial
Code;  provided, however, that the Pledgee shall not be required to take any
action or execute or deliver  any  document  pursuant  to this  section  5(c) to
the  extent  that it determines,  in reliance on an opinion of legal counsel,
that the taking of such action  or the  execution  or  delivery  of  such
document  would  result  in a prohibited  transaction  under section 4975 of the
Code or section 406 of ERISA, impair the status of the ESOP as a  tax-qualified
plan under section  401(a) of the Code or an employee  stock  ownership  plan
under section 4975 of the Code, impair the tax-exempt status of the Borrower
under section 501(a) of the Code or violate any other requirement of ERISA
applicable to the ESOP.

                  Section 6. Events of Default.

                  (a)  If a Default or an Event of Default  shall be existing,
in addition to the rights it may have under the Loan  Agreement,  the Promissory
Note, and this Pledge Agreement,  or by virtue of any other  instrument,  (i)the
Pledgee may exercise, with respect to Eligible Collateral, from time to time any
rights and  remedies  available  to it under the Uniform  Commercial  Code as in
effect from time to time in the State of New York or  otherwise  available to it
and (ii) the Pledgee shall have the right,  for and in the name, place and stead
of the Pledgor,  to execute  endorsements,  assignments,  stock powers and other
instruments of conveyance or transfer with respect to all or any of the Eligible
Collateral.  Written notification of intended disposition of any of the Eligible
Collateral  shall be given by the  Pledgee  to the  Pledgor  at least  three (3)
Business Days before such disposition. Subject to section 13 below, any proceeds
of any  disposition of Eligible  Collateral may be applied by the Pledgee to the
payment of expenses  in  connection  with the  Eligible  Collateral,  including,
without  limitation,  reasonable  attorneys'  fees and legal  expenses,  and any
balance of such  proceeds  may be applied by the  Pledgee  toward the payment of
such of the Liabilities as are in Default, and in such order of application,  as
the  Pledgee may from time to time  elect.  No action of the  Pledgee  permitted
hereunder  shall impair or affect its rights in and to the Eligible  Collateral.
All rights and remedies of the Pledgee  expressed  hereunder  are in addition to
all other rights and remedies  possessed by it, including,  without  limitation,
those contained in the documents referred to in the definition of Liabilities in
section  1 hereof.

                  (b) In any sale of any of the  Eligible  Collateral  after a
Default  or an Event of  Default  shall  have  occurred,  the  Pledgee is hereby
authorized to comply with any limitation or restriction in connection  with such
sale as it may be  advised  by  counsel  is  necessary  in order  to  avoid  any
violation of applicable law (including, without limitation, compliance with such
procedures as may restrict the number of  prospective  bidders and purchasers or
further  restrict  such  prospective  bidders or  purchasers to persons who will
represent  and  agree  that  they are  purchasing  for  their  own  account  for
investment  and not with a view to the  distribution  or resale of such Eligible
Collateral),  or in order to obtain such required approval of the sale or of the
purchase by any governmental  regulatory authority or official,  and the Pledgor
further  agrees  that such  compliance  shall not  result in such  sale's  being
considered or deemed not to have been made in a  commercially  reasonable

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manner,  nor shall the Pledgee be liable or  accountable  to the Pledgor for any
discount allowed by reason of the fact that such Eligible  Collateral is sold in
compliance with any such limitation or restriction.

                  Section  7.  Payment  in Full.  Upon the  payment  in full of
all  outstanding  Liabili ties,  this Pledge  Agreement  shall terminate and the
Pledgee shall  forthwith  assign,  transfer and deliver to the Pledgor,  against
receipt and without  recourse to the Pledgee,  all  Collateral  then held by the
Pledgee pursuant to this Pledge Agreement.

                  Section  8. No  Waiver.  No  failure  or delay on the part of
the  Pledgee  in exer  cising any right or remedy  hereunder  or under any other
document  which  confers or grants  any rights in the  Pledgee in respect of the
Liabilities  shall  operate as a waiver  thereof nor shall any single or partial
exercise  of any such right or remedy  preclude  any other or  further  exercise
thereof or the exercise of any other right or remedy of the Pledgee.

                  Section 9. Binding  Effect;  No  Assignment or  Delegation.
This  Pledge  Agreement  shall be binding  upon and inure to the  benefit of the
Pledgor,  the Pledgee and their respective  successors and assigns,  except that
the Pledgor may not assign or transfer  its rights  hereunder  without the prior
written  consent  of the  Pledgee  (which  consent  shall  not  unreasonably  be
withheld). Each duty or obligation of the Pledgor to the Pledgee pursuant to the
provisions of this Pledge Agreement shall be performed in favor of any person or
entity  designated by the Pledgee,  and any duty or obligation of the Pledgee to
the Pledgor may be  performed by any other  person or entity  designated  by the
Pledgee.

                  Section 10.  Governing Law. This Loan Agreement shall be
governed by and construed and enforced in accordance  with the laws of the State
of New York  applicable to contracts to be performed  wholly within the State of
New York entered into between  parties all of whom are citizens and residents of
the State of New York.

                  Section 11.  Notices.  All  notices,  requests,  instructions
or documents  hereunder  shall be in writing and delivered by hand or commercial
messenger service or sent by United States mail, registered or certified, return
receipt  requested,  with  proper  postage  prepaid,  or by telex or  facsimile,
addressed as follows:

                  (a)     If to the Pledgee:

                              Astoria Financial Corporation
                              One Astoria Federal Plaza
                              Lake Success, New York  11042
                              Attention:     General Counsel
                                             ---------------

                  (b)     If to the Pledgor:

                              The Long Island Savings Bank FSB

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                              Employee Stock Ownership Plan Trust
                              CG Trust Company
                              525 W. Monroe, Suite 1900
                              Chicago, Illinois    60601

                       with copies to:

                              The Long Island Savings Bank FSB
                              Employee Stock Ownership Plan Trust
                              c/o Astoria Federal Savings and Loan Association
                              One Astoria Federal Plaza
                              Lake Success, New York  11042
                              Attention:     General Counsel
                                             ---------------

Any  notice,  request or  communication  hereunder  shall be deemed to have been
given on the day on which it is  delivered  by hand or by  commercial  messenger
service,  or sent by telex or facsimile,  to such party at its address specified
above, or, if sent by mail, on the third Business Day after the day deposited in
the mail,  postage  prepaid,  addressed as  aforesaid.  Any party may change the
person or address to whom or which notices are to be given hereunder,  by notice
duly given hereunder; provided, however, that any such notice shall be deemed to
have  been  given  only  when  actually  received  by the  party  to  whom it is
addressed.

                  Section 12. Interpretation.  Wherever possible each provision
of this Pledge  Agreement shall be interpreted in such manner as to be effective
and valid under  applicable law, but if any provision hereof shall be prohibited
by or invalid under such law, such provisions shall be ineffective to the extent
of such  prohibition or invalidity,  without  invalidating the remainder of such
provision or the remaining provisions hereof.

                  Section  13. Construction.   All  provisions  hereof  shall
be construed so as to maintain  (a) the ESOP as a qualified  leveraged  employee
stock ownership plan under section 401(a) and 4975(e)(7) of the Internal Revenue
Code of 1986 (the "Code"),  (b) the Trust as exempt from taxation  under section
501(a) of the Code and (c) the loan made  pursuant to the Loan  Agreement  as an
exempt loan under  Treasury  Regulation  ss.  54.4975-7(b)  and as  described in
Department of Labor Regulation ss. 2550.408b-3.

                  IN WITNESS WHEREOF,  this Pledge Agreement has been duly
executed by the parties hereto as of the day and year first above written.

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                                  THE LONG ISLAND SAVINGS BANK FSB EMPLOYEE
                                  STOCK OWNERSHIP PLAN TRUST

                                  By      CG TRUST COMPANY
                                          solely as Trustee and not in any other
                                          capacity

                                  By:     /S/ Mary Lou Filiault
                                          --------------------------------------

                                  Name:   Mary Lou Filiault
                                          --------------------------------------

                                  Title:  Vice President
                                          --------------------------------------

                                  ASTORIA FINANCIAL CORPORATION

                                  By:     /S/ Alan P. Eggleston
                                          --------------------------------------

                                  Name:   Alan P. Eggleston
                                          --------------------------------------

                                  Title:  Executive Vice President and General
                                          Counsel

                                        7<PAGE>   1
EXHIBIT 10.18

             AMENDMENT TO SECTION 4.5 OF THE 1999 STOCK OPTION PLAN
             FOR OUTSIDE DIRECTORS OF ASTORIA FINANCIAL CORPORATION

               Section 4.5    Method of Exercise.

               ...

               (b) The Exercise  Price of Shares to be purchased  upon exercise
  of any Option shall be paid in full (i) in cash (by certified or bank check or
  such other  instrument as the Company may accept);  (ii) in the form of Shares
  already owned  beneficially for a period of more than six months by the Option
  holder  having  an  aggregate  Fair  Market  Value on the date the  Option  is
  exercised  equal to the  aggregate  Exercise  Price to be paid;  or (iii) by a
  combination  thereof.  Payment for any Shares to be purchased upon exercise of
  an Option may also be made by delivering a properly  executed  exercise notice
  to the Company,  together with a copy of irrevocable  instructions to a broker
  to deliver  promptly to the Company the amount of sale or loan proceeds to pay
  the purchase  price.  To facilitate the foregoing,  the Company may enter into
  agreements for coordinated procedures with one or more brokerage firms.

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