Document:

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                                                                    EXHIBIT 10.4

             EXECUTIVE'S DEFERRED COMPENSATION AGREEMENT (2001 PLAN)

     AGREEMENT, made as of the 1st day of November, 2001, between Brady
Corporation, a Wisconsin corporation ("Corporation") and ____________________
("Executive").

                                   WITNESSETH:

     WHEREAS, Executive is now serving as an executive of the Corporation in a
position of importance and responsibility;

     WHEREAS, the Board of Directors of the Corporation has adopted a plan
permitting Executives of the Corporation to elect to defer portions of their
compensation payable from the Corporation at the times and upon the terms and
conditions of that plan; and

     WHEREAS, the terms of such deferrals are reflected in individual deferred
compensation agreements that have been executed from time to time with
Executives of the Corporation and;

     WHEREAS, pursuant to the plan Executive and Corporation have been party to
a deferred compensation agreement dated as of November, 1997 pursuant to which
the Executive has had the ability to defer compensation (the "Prior Agreement");
and

     WHEREAS, pursuant to the authority vested in the Corporation under the
Prior Agreement the Corporation has provided the Executive with notice that no
further deferrals shall be made under the Prior Agreement on or after November
1, 2001 and that the terms of the Prior Agreement shall remain unchanged except
as it may be specifically amended from time to time in the future; and

     WHEREAS, the Corporation and the Executive desire to enter into a new
Deferred Compensation Agreement to govern deferrals of (i) base salary and/or
(ii) portions of the amounts payable to Executive under the Corporation's
Executive Additional Compensation Plan, or any amendment of that plan, or any
bonus plan which replaces that plan so as to be payable on the basis, at the
times and upon the terms and conditions of that plan (collectively, the "Plan");

     NOW, THEREFORE, in consideration of the premises and the mutual benefits to
be derived herefrom, IT IS AGREED AS FOLLOWS:

1.   DEFERRED COMPENSATION ACCOUNT

     There shall be created on the books of the Corporation an Executive's
     Deferred Compensation Account (the "Account"), which shall be credited with
     the amounts specified in Executive's elections under this Deferred
     Compensation Agreement (the "Election").

     Elections shall be in writing, made prior to the beginning of the year, or
     partial year, in which the compensation would otherwise be paid, and filed
     with the Corporate Controller of the Corporation. Such election shall be
     made in dollar or percentage amounts and

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     shall be effective with respect to pay periods occurring in the following
     year, or, with respect to the Plan, for amounts which would become payable
     in years beginning after the date of filing.

     An Election shall be irrevocable with respect to the period to which it
     relates and shall continue in effect each like period thereafter until
     revoked or amended in writing with respect to periods beginning after the
     filing with the Corporation of such written revocation or amendment.

2.   VALUATION OF ACCOUNT

     (a)  The Executive's Account shall be credited or charged with deemed
          earnings or losses as if it were invested in accordance with paragraph
          (b) below. The Executive's Account shall also be charged with the
          costs of administration of such account.

     (b)  (1)  The investment funds available hereunder for the deemed
               investment of the Account shall be the same investment funds,
               including the Brady Stock Fund, as available under the Brady
               Matched 401(k) Plan except to the extent the Compensation
               Committee of the Board of Directors (the "Committee") shall from
               time to time determine that different investment funds shall be
               available for the deemed investment of the Account. However, in
               no event shall the Corporation be required to make any such
               investment in the investment funds, and to the extent such
               investments are made, such investments shall remain an asset of
               the Corporation subject to the claims of its general creditors.

          (2)  On the date credited to the Executive's Account, deferrals shall
               be deemed to be invested in one or more of the investment funds
               designated by the Executive for such deemed investment. Once
               made, the Executive's investment designation shall continue in
               effect for all future deferrals until changed by the Executive.
               Any such change may be elected by the Executive at the times
               established by the Committee, which shall be no less frequently
               than quarterly, and shall be effective only for deferrals,
               credited from and after its effective date. Until such time as
               the Committee takes action to the contrary, such changes may be
               elected at the same times as changes may be elected with respect
               to the Brady Matched 401(k) Plan.

          (3)  A Participant may elect to reallocate his Account balance among
               the investment funds at the times established by the Committee,
               which shall be no less frequently than quarterly. Until such time
               as the Committee takes action to the contrary, such changes may
               be elected at the same times as changes may be elected with
               respect to the Brady Matched 401(k) Plan. Notwithstanding any
               other provision of this Agreement to the contrary, Executive may
               not make (i) any election or transaction in the Brady Stock Fund
               at a time when Executive is in possession of any

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               material non-public information or at a time not permitted under
               the Corporation's policy on insider trading or (ii) an opposite
               way election with respect to the Brady Stock Fund within six
               months of a prior election regarding the Brady Stock Fund.

          (4)  All investment elections and designations by Executive shall be
               made in accordance with procedures prescribed by the Committee.
               The Committee may prescribe uniform percentages for such
               elections and designations.

          (5)  The Corporation shall provide annual reports to each Executive
               showing (a) the value of the Account as of the most recent
               December 31st, (b) the amount of deferral made by the Executive
               for the year ending on such date and (c) the amount of any
               interest, earnings or investment gain or loss and the costs of
               administration credited or debited to the Executive's Account.

          (6)  Notwithstanding any other provision of this Agreement that may be
               interpreted to the contrary, the deemed investments are to be
               used for measurement purposes only, and Executive's election of
               any such fund, the allocation to Executive's Account balance
               thereto, the calculation of additional amounts and the crediting
               or debiting of such amounts to Executive's Account balance shall
               not be considered or construed in any manner as an actual
               investment of Executive's Account balance in any such fund. In
               the event that the Corporation or the trustee of any grantor
               trust, in its own discretion, decides to invest funds in any or
               all of the funds, Executive shall have no rights in or to such
               investments themselves. Without limiting the foregoing,
               Executive's Account balance shall at all times be a bookkeeping
               entry only and shall not represent any investment made on
               Executive's behalf by the Corporation or any trust; the Executive
               shall at all times remain an unsecured creditor of the
               Corporation.

     (c)  An Executive shall be fully vested and nonforfeitable at all times in
          Executive's Account hereunder.

3.   WITHDRAWAL PAYOUTS

     (a)  If the Executive experiences an Unforeseeable Financial Emergency, the
          Executive may petition the Committee to (i) suspend any deferrals
          required to be made by Executive and/or (ii) receive a partial or full
          payout of Executive's Account balance. The payout shall not exceed the
          lesser of the Executive's Account balance, or the amount reasonably
          needed to satisfy the Unforeseeable Financial Emergency. If, subject
          to the sole discretion of the Committee, the petition for a suspension
          and/or payout is approved, suspension shall take effect upon the date
          of approval and any payout shall be made in a single lump sum in cash
          within 90 days of the date of approval.

          "Unforeseeable Financial Emergency" shall mean an unanticipated
          emergency that is caused by an event beyond the control of the
          Executive that would result in

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          severe financial hardship to the Executive resulting from (i) a sudden
          and unexpected illness or accident of the Executive or a dependent of
          the Executive, (ii) a loss of the Executive's property due to
          casualty, or (iii) such other extraordinary and unforeseeable
          circumstances arising as a result of events beyond the control of the
          Executive, all as determined in the sole discretion of the Committee.

     (b)  At any time prior to the commencement of benefit payments under
          Section 4, the Executive may elect to receive a distribution of all or
          a portion of Executive's Account balance. A distribution pursuant to
          the provisions of this paragraph shall be made as soon as
          administratively practicable in an immediate lump sum cash payment of
          the requested amount, reduced by a penalty, which shall be forfeited
          to the Corporation, equal to 10% of the balance of such requested
          amount. In the event benefit payments to an Executive have commenced
          in installments pursuant to the provisions of Section 4, the Executive
          may elect instead to receive an immediate lump sum distribution of the
          remaining balance of the Executive's account in which case
          distribution of such remaining balance shall be made as soon
          administratively practicable in an immediate lump sum cash payment,
          reduced by a penalty, which shall be forfeited to the Corporation,
          equal to 10% of such remaining balance.

4.   DISTRIBUTIONS TO EXECUTIVE FOLLOWING TERMINATION OF EMPLOYMENT

     (a)  If the Executive's employment is terminated due to any reason,
          including retirement, disability, or death, and if no effective
          election exists under paragraph (b) below and if no application and
          approval under paragraph (c) below has been made, the Corporation
          shall distribute the Executive's Account to Executive, or Executive's
          Beneficiary, under the Annual Installment Method over a period of ten
          (10) years using the Fractional Method for a fixed period of ten
          years.

     (b)  By submitting an Election Form to the Committee, provided that any
          such Election Form is submitted as least one year prior to the date of
          the Executive's termination of employment, the Executive shall elect
          whether to receive his Account balance following termination of
          employment in a single lump sum in cash or by means of cash
          distribution under an Annual Installment Method. The Election Form
          most recently on file shall govern the payout of the Account. If the
          Executive does not submit an Election Form or has not submitted one
          timely, then payment shall be made under paragraph (a) above unless an
          application has been made and approved under paragraph (c) below. Even
          if a valid election has been made under this paragraph (b), payment
          shall instead be made under paragraph (c) if an application has been
          made and approved under paragraph (c). The lump sum payment shall be
          made, or installment payments shall commence, within 60 days after the
          last day of the fiscal year in which the Executive's employment
          terminates.

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     (c)  Upon application of the Executive (or Executive's Beneficiary if
          Executive is deceased), the Corporation may, if determined by the
          Committee in its absolute discretion, and upon such terms and
          conditions as the Committee determines, pay Executive the amount
          credited to the Account in smaller installments or in a lump sum or
          other basis.

     (d)  "Annual Installment Method" shall be an annual installment payment
          over the number of years selected by the Executive, not to exceed 10.
          In each case, the Account balance of the Executive shall be calculated
          as of the close of the fiscal year commencing with the close of the
          fiscal year after the executive terminates employment. Each annual
          installment, regardless of the method selected, shall be payable
          within 60 days after such date. The alternative methods available are
          as follows:

          (1)  Fractional Method. The annual installment shall be calculated by
               multiplying this balance by a fraction, the numerator of which is
               one, and the denominator of which is the remaining number of
               annual payments due the Executive. By way of example, if the
               Executive elects a 10 year Annual Installment Method, the first
               payment shall be 1/10 of the Account balance. The following year,
               the payment shall be 1/9 of the Account balance.

          (2)  Percentage or Fixed Dollar Method. The annual installment shall
               be calculated by multiplying this balance in the case of the
               percentage method, by the percentage selected by the Executive
               and paying out the resulting amount, or in the case of the fixed
               dollar method, by paying out the fixed dollar amount selected by
               the Executive, for the number of years selected by the Executive.
               However, in the event the dollar amount selected is more than the
               Account balance in any given year, the entire Account balance
               will be distributed. Further, regardless of the method selected
               by the Executive, the final installment payment will include 100%
               of the then remaining Account balance.

     (e)  "Election Form" shall mean the form established from time to time by
          the Committee that Executive completes, signs and returns to the
          Committee to make an election under the Plan. To the extent authorized
          by the Committee, such form may be electronic or set forth in some
          other media and need not be signed by the Executive.

5.   DISTRIBUTION TO BENEFICIARY OR ESTATE OF EXECUTIVE

     (a)  In the event of the Executive's death, annual distributions will be
          made to the Executive's Beneficiary as follows:

          (1)  If the Executive dies prior to termination of employment, the
               distributions will be in the same annual amounts and for the same
               number of years as the distribution would have been received had
               the Executive terminated

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               employment on the date of death and lived for the shorter of the
               term, if any, in effect under 4(a) or 4(b), whichever is
               applicable, or the term permitted under 4(c);

          (2)  If the Executive dies after employment has terminated, the
               distributions will be in the same annual amounts as were being
               made or were distributable at the date of death for the remaining
               period that distributions would have been made had the Executive
               lived.

          (3)  Upon application of the Executive's beneficiary, the Corporation
               may, if determined by the Committee in its absolute discretion,
               and upon such terms and conditions as the Committee determines,
               pay Executive's beneficiary the amount credited to the account in
               smaller installments or in a lump sum or other basis.

     (b)  The term "Beneficiary" as used herein includes the plural and means
          any person(s), including corporate or individual beneficiary(s),
          designated by Executive in a written instrument in a form acceptable
          to and filed with the Corporation or by specific appointment in
          Executive's will referring to this Agreement. Executive may designate
          a primary beneficiary and a contingent beneficiary, provided, however,
          that the Corporation may reject any such instrument tendered for
          filing if it contains successive beneficiaries or contingencies
          unacceptable to it. In the absence of an acceptable designation or if
          the Beneficiary so designated predeceases Executive, the payments
          shall be paid to Executive's estate. If all Beneficiaries who survive
          Executive shall die before receiving the full amounts payable
          hereunder, then the payments shall be paid to the estate of the
          Beneficiary last to die. The Corporation shall not be charged with
          notice of the appointment of a personal representative of Executive
          until it shall have received a certified copy of the appointment.

6.   GENERAL PROVISIONS

     (a)  This Agreement shall not be subject to termination, modification or
          amendment by the Corporation with respect to any rights which have
          accrued hereunder, the Corporation reserving the right, however, to
          terminate, modify or amend this Agreement effective prospectively as
          of the first day of any fiscal year upon not less than 15 days prior
          written notice to Executive.

     (b)  The Corporation shall have the right to assign all of its right, title
          and obligation in and under this Agreement upon a merger or
          consolidation in which the Corporation is not the surviving entity or
          to the purchaser of substantially its entire business or assets or the
          business or assets pertaining to a major product line, provided such
          assignee or purchaser assumes and agrees to perform after the
          effective date of such assignment all of the terms, conditions and
          provisions imposed by this Agreement upon the Corporation. Upon such
          assignment, all of the rights, as well as all obligations, of the
          Corporation under this Agreement shall thereupon cease and terminate.

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     (c)  Any action to be taken by the Corporation under the provisions of this
          Agreement which is not the responsibility of the Committee under this
          Agreement shall require the affirmative vote of the majority of the
          Board of Directors.

     (d)  Neither Executive nor Executive's Beneficiary or estate shall have
          power to transfer, assign, anticipate, mortgage or otherwise encumber
          any rights or any amounts payable hereunder; nor shall any such rights
          or payments be subject to seizure for the payment of any debts,
          judgments, alimony, or separate maintenance, or be transferable by
          operation of law in event of bankruptcy, insolvency, or otherwise.

     (e)  The Corporation will withhold any necessary amounts from the
          distribution to satisfy its Federal and State withholding tax
          obligations as a result of the distribution or from other amounts paid
          to such individual by the Corporation. Further, to the extent required
          by law, FICA taxes may be withheld from amounts deferred hereunder,
          thereby reducing the amount of the deferral to the extent not withheld
          from other amounts paid to the Executive by the Corporation.

     (f)  This Agreement shall not supersede any other service, retainer, or
          employment contract, whether oral or in writing, between the
          Corporation and Executive, nor affect or impair the rights and
          obligations of the Corporation and Executive, respectively, under any
          other contract, arrangement, or voluntary pension, profit-sharing or
          other compensation plan of the Corporation, and the benefits and
          payments under this Agreement shall be in addition to any and all of
          Executive's benefits to which he may be entitled under any other such
          contract, arrangement or voluntary plan. No amounts credited to
          Executive hereunder and no amounts paid hereunder will be taken into
          account as wages, salary, base pay or any other type of compensation
          when determining the amount of any payment or allocation or for any
          other purpose, under any other qualified or non-qualified pension or
          profit sharing plan of the Corporation, except as otherwise may be
          specifically provided by such plan. Nothing contained herein shall
          impose any obligation on the Corporation to continue the tenure or
          employment of Executive.

     (g)  The right of Executive to receive payment hereunder shall be an
          unsecured claim against the general assets of the Corporation, and no
          provisions contained herein, nor any action taken hereunder shall be
          construed to give any individual at any time a security interest in
          any asset of the Corporation, of any affiliated Corporation, or of the
          stockholders of the Corporation. The liabilities of the Corporation to
          Executive hereunder shall be those of a debtor pursuant to such
          contractual obligations as are created hereunder and to the extent any
          person acquires a right to receive payment from the Corporation
          hereunder, such right shall be no greater than the right of any
          unsecured general creditor of the Corporation.

          The Corporation may establish a grantor trust (but shall not be
          required to do so) to which shall be contributed (subject to the
          claims of the general creditors of the Corporation) the amounts
          credited to the Account. If a grantor trust is so

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          established, payment by the trust of the amounts due Executive or his
          Beneficiary hereunder shall be considered a payment by the Employer
          for purposes of this Agreement.

     (h)  If the scheduled payments under this Agreement would result in
          disallowance of any portion of the Corporation's deduction therefor
          under Section 162(m) of the Code, the payments shall be limited to the
          amount which is deductible, with the balance to be paid as soon as
          deductible by the Corporation. The Executive shall be permitted to
          continue to make investment elections with respect to the
          undistributed portion of the Executive's Account.

     (i)  This Agreement shall be administered by the Compensation Committee of
          the Board of Directors of the Corporation. The Committee shall have
          all authority that may be appropriate for administering the Agreement,
          including the authority to adopt rules and regulations for
          implementing, amending and carrying out the Agreement, interpreting
          the provisions of the Agreement and the entitlement to benefits
          hereunder of Executive or Executive's Beneficiary.

          The Committee shall have full and complete discretionary authority to
          determine eligibility for benefits under the Agreement, to construe
          the terms of the Agreement and to decide any matter presented through
          the claims procedure. Any final determination by the Committee shall
          be binding on all parties. If challenged in court, such determination
          shall not be subject to de novo review.

          If Executive is a member of the Committee, Executive may not vote or
          decide upon any matter relating to his rights hereunder. Decisions
          shall be made by remaining Committee or Board members even if there is
          no quorum under normal Committee or Board rules.

     (j)  This Agreement is intended to be part of an unfunded arrangement
          maintained by the Corporation primarily for the purpose of providing
          deferred compensation for a select group of management or highly
          compensated employees, as described in Section 201(2), Section
          301(a)(3), Section 401(a)(1) and Section 4021(b)(6) of the Employee
          Retirement Income Security Act of 1974, as amended ("ERISA").

     (k)  If the Executive or the Executive's Beneficiary (hereinafter referred
          to as "claimant") believes claimant is being denied any benefit to
          which claimant is entitled under this Plan for any reason, claimant
          may file a written claim with the Committee. The Committee shall
          review the claim and notify the claimant of its decision within 90
          days of receipt of such claim, unless the claimant receives written
          notice prior to the end of the 90 day period stating that special
          circumstances require an extension of the time for decision. The
          Committee's decision shall be in writing, sent by first class mail to
          the claimant's last known address, and if a denial of the claim, shall
          contain the specific reasons for the denial, reference to pertinent
          provisions of the Agreement on which the denial is based, a
          description of any additional information or material necessary to
          perfect the claim, an explanation of the claims review procedure, and
          a statement of the

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          individual's right to bring a civil action under ERISA Section 502(a)
          if the claim is denied upon review.

          A claimant is entitled to request the entire Committee to review any
          denial by written request to the Committee within 60 days of receipt
          of the denial. Absent a request for review within the 60-day period,
          the claim will be deemed to be conclusively denied. The Committee
          shall afford the claimant or claimant's authorized representative the
          opportunity to review all pertinent documents and submit issues and
          comments in writing and shall render a review decision in writing, all
          within 60 days after receipt of a request for review (provided that in
          special circumstances the Committee may extend the time for decision
          by not more than 60 days upon written notice to the claimant). The
          Committee's review decision shall contain specific reasons for the
          decision and reference to the pertinent provisions of the Plan, a
          statement that the claimant is entitled to receive, upon request and
          free of charge, reasonable access to, and copies of, all documents,
          records, and other information relevant to the claimant's claim for
          benefits and a statement of the claimant's right to bring an action
          under Section 502(a) of ERISA.

     (l)  This Plan shall be construed in accordance with the laws of the State
          of Wisconsin to the extent not preempted by the provisions of the
          ("ERISA") or other federal law.

     (m)  Notwithstanding any other provisions of this Agreement to the
          contrary, the Committee may direct payment of Executive's Account
          before it otherwise would be payable, if based on notification from
          the Internal Revenue Service or a review by the Committee in light of
          Internal Revenue Service guidance, the Committee determines that
          Executive has or will recognize income for federal income tax purposes
          with respect to amounts that are or will be payable hereunder before
          they are to be paid. Further, the Committee may direct payment of
          Executive's Account before it otherwise would be payable and may
          terminate this Agreement if, based on notification from the Department
          of Labor or a review by the Committee in light of Department of Labor
          guidance, the Committee determines that this arrangement does not
          qualify under paragraph (j) above. In the case of either such event,
          the Committee shall also have the right, in its sole discretion, to
          (i) terminate any deferral election the Executive has made for the
          remainder of the year in which the Executive's status changes and (ii)
          prevent the Executive from making future deferral elections.

     (n)  Any notice or filing required or permitted to be given to the
          Committee hereunder shall be sufficient if in writing and
          hand-delivered, or sent by registered or certified mail, to the
          address below:

                         Corporate Treasurer
                         Brady Corporation
                         P.O. Box 571
                         Milwaukee, WI  53201-0571

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          Such notice shall be deemed given as of the date of delivery or, if
          delivery is made by mail, as of the date shown on the postmark on the
          receipt for registration or certification.

          Any notice or filing required or permitted to be given to Executive
          hereunder shall be sufficient if in writing and hand-delivered, or
          sent by mail, to the last known address of the Executive.

     (o)  If the Committee determines in its discretion that a benefit hereunder
          is to be paid to a minor, a person declared incompetent or to a person
          incapable of handling the disposition of that person's property, the
          Committee may direct payment of such benefit to the guardian, legal
          representative or person having the care and custody of such minor,
          incompetent or incapable person. The Committee may require proof of
          minority, incompetence, incapacity or guardianship, as it may deem
          appropriate prior to distribution of the benefit. Any payment of a
          benefit shall be a payment for the account of the Executive and the
          Executive's Beneficiary, as the case may be, and shall be a complete
          discharge of any liability hereunder for such payment amount.

     (p)  The Committee is authorized to make any payments directed by court
          order in any action in which the Corporation or the Committee has been
          named as a party. In addition, if a court determines that a spouse or
          former spouse of Executive has an interest in the Executive's benefits
          hereunder in connection with a property settlement or otherwise, the
          Committee, in its sole discretion, shall have the right,
          notwithstanding any election made by Executive, to immediately
          distribute the spouse's or former spouse's interest in the Executive's
          benefits hereunder to that spouse or former spouse.

     IN WITNESS WHEREOF, the Corporation has caused this Agreement to be signed
by its Officers thereunto duly authorized and its corporate seal to be hereunto
affixed, and Executive has hereunto set his hand and seal as of the day and year
first above written.

BRADY CORPORATION

By:                                       By:                             (SEAL)
    ----------------------------------        ----------------------------
                                              Executive
Title:
        ------------------------------

Attest:
        ------------------------------
Title:
        ------------------------------

                                       10<PAGE>
                                                                    EXHIBIT 10.5

                   DIRECTOR'S DEFERRED COMPENSATION AGREEMENT

     AGREEMENT, made as of the _____ day of ____________, 19____, between W.H.
BRADY CO., a Wisconsin corporation ("Company") and _________________________
("Director").

                                   WITNESSETH:

     WHEREAS, Director is now serving or has previously served as a director of
the Company, and the Company desires to provide such Director with a tax
deferral opportunity in the form of Company common stock; and

     WHEREAS, the Board of Directors of the Company has adopted a plan
permitting Directors of the Company to elect to defer portions of their fees at
the times and upon the terms and conditions of that plan;

     WHEREAS, the terms of such deferrals are reflected in individual deferral
agreements that have been executed from time to time with the Directors of the
Company, and

     WHEREAS, the parties desire to execute a new agreement to reflect recent
changes adopted by the Board of Directors,

     NOW, THEREFORE, in consideration of the premises and the mutual benefits to
be derived herefrom, IT IS AGREED AS FOLLOWS:

1.   DEFERRED COMPENSATION ACCOUNT

     There shall be created on the books of the Company a Director's Deferred
     Compensation Account (the "Account"), which shall be credited with the
     amounts specified in Director's elections under this Deferred Compensation
     Agreement (the "Election").

     Elections shall be in writing, made prior to the beginning of the year, or
     partial year, in which the fees would otherwise be paid, and filed with the
     Corporate Controller of the Company. Such election shall be effective with
     respect to fees to be paid in fee periods occurring in the following year.

     Elections with respect to fees shall be in an amount of $100 or a multiple
     thereof.

     An Election shall be irrevocable with respect to the fiscal year to which
     it relates and shall continue in effect from year to year thereafter until
     revoked or amended in writing with respect to a subsequent fiscal year
     prior to the beginning thereof. Your rate of deferral under your prior
     deferral agreement will be your rate of deferral under this Agreement for
     the current fiscal year and will continue as the deferral rate for
     subsequent years unless revoked or amended by written notice from you to
     the Company prior to the beginning of a subsequent fiscal year.

<PAGE>

2.   VALUATION OF ACCOUNT

     Whenever amounts are withheld from the Director's fees, the Director's
     Account shall be credited with a number of stock units, calculated by
     converting the amount withheld into a number of whole or fractional stock
     units as if the amounts had been used to purchase Class A non-voting common
     stock of the Company at the price determined under paragraph 5 of this
     Agreement. The Account shall also be credited with additional stock units
     whenever dividends are paid on the Class A non-voting common stock of the
     Company, calculated by assuming that such dividends were used to purchase
     additional stock units at the price determined under paragraph 5 of this
     Agreement. The Account shall be credited from time to time with additional
     shares of stock units equal in number to the number of shares granted in
     any stock dividend or split to which the holder of a like number of shares
     of Class A non-voting common stock would be entitled. The Account shall
     likewise be credited with the stock unit equivalent of all other
     distributions made with respect to shares of Class A non-voting common
     stock; in the event of a distribution of preferred stock, such preferred
     stock shall be valued at is par value (or its voluntary liquidating price,
     if it does not have a par value).

3.   DISTRIBUTIONS TO DIRECTOR FOLLOWING TERMINATION OF EMPLOYMENT

     (a)  If the Director's service as a director is terminated due to any
          reason, including his retirement, disability, or death, and if no
          application and approval under 3(b) has been made, the Company shall
          distribute to Director, or his Beneficiary, each year for a fixed
          period of ten years, shares of the Class A non-voting common stock
          equal to the allocable part of the number of stock units of his
          Account determined as of end of each fiscal year. Thus, the first
          distribution shall be one-tenth of the number of stock units then
          credited to such account, the second one-ninth of the then number of
          stock units, etc. Such distributions shall be made within 75 days
          following the end of the Company's fiscal year, commencing with the
          first fiscal year end after the date of termination of employment. The
          number of stock units in the Account shall be reduced by the number of
          shares of Class A non-voting common stock distributed in each
          distribution.

     (b)  Upon application of the Director (or Director's Beneficiary if
          Director dies prior to termination of service as a Director), the
          Company may in its uncontrolled discretion and upon such terms and
          conditions as the Board of Directors determines, pay Director the
          amount credited to the Director's Account in a different number of
          installments (but not to exceed ten) or in a lump sum on a discount or
          other basis.

4.   DISTRIBUTION TO BENEFICIARY OR ESTATE OF DIRECTOR

     (a)  In the event of the Director's death, annual distributions will be
          made to the Director's beneficiary as follows:

                                       2

<PAGE>

          (1)  If the Director dies prior to termination of employment, the
               distributions will be in the same annual amounts and for the same
               number of years as the distribution would have been received had
               the Director terminated employment on the date of death and lived
               for the shorter of 10 years or the term permitted under 3(b);

          (2)  If the Director dies after employment has terminated, the
               distributions will be in the same annual amounts as were being
               made or were distributable at the date of death for the remaining
               period that distributions would have been made had the Director
               lived.

     (b)  The term "Beneficiary" as used herein includes the plural and means
          any person(s), including corporation or individual beneficiary(s),
          designated by Director in a written instrument in a form acceptable to
          and filed with the Company or by a specific appointment in Director's
          will referring to this Agreement. Director may designate a primary
          beneficiary and a contingent beneficiary provided, however, that the
          Company may reject any such instrument tendered for filing if it
          contains successive beneficiaries or contingencies unacceptable to it.
          In the absence of an acceptable designation or if the Beneficiary so
          designated predeceases Director, the payments shall be paid to
          Director's estate. If all Beneficiaries who survive Director shall die
          before receiving the full amounts payable hereunder, then the payments
          shall be paid to the estate of the Beneficiary last to die. The
          Company shall not be charged with notice of the appointment of a
          personal representative of Director until it shall have received a
          certified copy of the appointment.

5.   ACCOUNTING AND VALUATION DETERMINATIONS

     For the purpose of determining the amounts credited to the Account pursuant
     to paragraph 2, the value of a stock unit shall be set equal to the Fair
     Market Value of the Class A non-voting common stock. Fair Market Value on
     any date shall mean, with respect to the Company's Class A non-voting
     common stock or any other stock of the Company, if the stock is then listed
     and traded on a registered national securities exchange, or is quoted in
     the NASDAQ National Market System, the average of the high and low sale
     prices reported in composite transactions as reported in The Wall Street
     Journal (Midwest Edition) for such date or, if such date is not a business
     day or if no sales of Company stock shall have been reported with respect
     to such date, the next preceding date with respect to which sales were
     reported. In the absence of reported sales or if the stock is not so listed
     or quoted, but is traded in the over-the-counter market, Fair Market Value
     shall be the average of the closing bid and asked prices for such shares on
     the relevant date.

6.   CONVERSION FROM PRIOR AGREEMENT

     (a)  As of the earlier of the date of election to convert under paragraph
          6(b) or August 1, 1998, deferrals under the prior deferral agreement
          shall no longer be available. Any new amounts deferred shall be under
          the terms of this Agreement, but such

                                       3

<PAGE>

          prior agreement shall remain in effect with respect to amounts
          previously deferred, unless conversion is made under the terms of
          paragraph 6(b) hereof. Any remaining unconverted balances under any
          prior agreement will continue to be valued as described in such
          agreement until July 31, 2002, after which date any increase in value
          for the following year will be based on the closing yield rate on a
          30-year U.S. Treasury Bond as of the preceding July 31.

     (b)  If Director elects in writing, the amount contained in the Director's
          Account under the terms of the prior agreement can be converted into
          amounts deferred under the terms of this Agreement, and distributions
          will thereafter be made solely under the terms of this Agreement
          except that distributions to Directors to whom distributions have
          commenced prior to the date hereof shall continue to be made at the
          times provided in the prior Agreement. Such conversion may only be
          elected on November 19, 1997. The number of stock units credited to
          the Director's Account shall be determined as of the date of such
          conversion by valuing the Director's Account as of such date under the
          terms of the prior agreement, and then converting such value into an
          equivalent number of stock units under this Agreement by dividing such
          sum by the transfer price as determined under paragraph 6(c).

     (c)  The transfer price for the conversion of amounts held under the
          Director's prior deferral agreement shall be the Fair Market Value of
          a stock unit as determined under the provisions of Paragraph 5 for the
          date of conversion. A one-time discount of 10%, as determined by the
          Board of Directors of the Company, may be offered to the Director if
          the Director converts amounts at the conversion date offered by the
          Company.

7.   GENERAL PROVISIONS

     (a)  This Agreement shall not be subject to termination, modification or
          amendment by the Company with respect to any rights which have accrued
          hereunder, the Company reserving the right, however, to terminate,
          modify or amend this Agreement effective prospectively as of the first
          day of any fiscal year upon not less than 15 days prior written notice
          to Director.

     (b)  The Company shall have the right to assign all of its right, title and
          obligation in and under this Agreement upon a merger or consolidation
          in which the Company is not the surviving entity or to the purchaser
          of substantially its entire business, provided such assignee or
          purchaser assumes and agrees to perform after the effective date of
          such assignment all of the terms, conditions and provisions imposed by
          this Agreement upon the Company. Upon such assignment, all of the
          rights, as well as all obligations, of the Company under this
          Agreement shall thereupon cease and terminate.

     (c)  Any action to be taken by the Company under the provisions of this
          Agreement shall require the affirmative vote of the majority of the
          Board of Directors.

                                       4

<PAGE>

     (d)  Neither Director nor Director's Beneficiary or estate shall have power
          to transfer, assign, anticipate, mortgage or otherwise encumber any
          rights or any amounts payable hereunder; nor shall any such rights or
          payments be subject to seizure for the payment of any debts,
          judgments, alimony, or separate maintenance, or be transferable by
          operation of law in event of bankruptcy, insolvency, or otherwise.

     (e)  The Company will withhold any necessary shares from the distribution
          to satisfy its Federal and State withholding tax obligations, if any,
          as a result of the distribution or from other amounts paid to such
          individual by the Company. Further, to the extent required by law,
          FICA taxes may be withheld from amounts deferred hereunder, thereby
          reducing the amount of the deferral to the extent not withheld from
          other amounts paid to the Director by the Company.

     (f)  This Agreement shall not supersede any other service, retainer, or
          employment contract, whether oral or in writing, between the Company
          and Director, nor affect or impair the rights and obligations of the
          Company and Director, respectively, under any other contract,
          arrangement, or voluntary pension, profit-sharing or other
          compensation plan of the Company, and the benefits and payments under
          this Agreement shall be in addition to any and all of Director's
          benefits to which he may be entitled under any other such contract,
          arrangement or voluntary plan. No amounts credited to any participant
          hereunder and no amounts paid hereunder will be taken into account as
          wages, salary, base pay or any other type of compensation when
          determining the amount of any payment or allocation or for any other
          purpose, under any other qualified or non-qualified pension or profit
          sharing plan of the Company, except as otherwise may be specifically
          provided by such plan. Nothing contained herein shall impose any
          obligation on the Company to continue the tenure or employment of
          Director.

     (g)  The Company shall have the right to transfer its rights and
          obligations hereunder to the trustees of a grantor trust established
          by the Company and shall have the right to transfer sufficient shares
          of common stock to such trust to satisfy its obligations hereunder.

     (h)  If the scheduled payments under this Agreement would result in
          disallowance of any portion of the Company's deduction therefore under
          Section 162(m) of the Code, the payments shall be limited to the
          amount which is deductible, with the balance to be paid as soon as
          deductible by the Company. However, in such event, the Company shall
          pay the Director on a quarterly basis an amount of interest based on
          the prime rate recomputed each quarter on the unpaid scheduled
          payments.

     (i)  This Plan shall be administered by the Compensation Committee of the
          Board of Directors of the Company. The Committee shall have all
          authority that may be appropriate for administering the Plan,
          including the authority to adopt rules and regulations for
          implementing, amending and carrying out the Plan, interpreting the
          provisions of the Plan and determining the eligibility of directors to
          participate in the Plan and an eligible director's entitlement to
          benefits hereunder.

                                       5

<PAGE>

          The Committee shall have full and complete discretionary authority to
          determine eligibility for benefits under the Plan, to construe the
          terms of the Plan and to decide any matter presented through the
          claims procedure. Any final determination by the Committee shall be
          binding on all parties. If challenged in court, such determination
          shall not be subject to de novo review.

     (j)  If the Director or the Director's Beneficiary (hereinafter refereed to
          as "claimant") believes he is being denied any benefit to which he is
          entitled under this Plan for any reason, he may file a written claim
          with the Committee. The Committee shall review the claim and notify
          the claimant of its decision within 90 days of receipt of such claim,
          unless the claimant receives written notice prior to the end of the 90
          day period stating that special circumstances require an extension of
          the time for decision. The Committee's decision shall be in writing,
          sent by first class mail to the claimant's last known address, and if
          a denial of the claim, shall contain the specific reasons for the
          denial, reference to pertinent provisions of the Plan on which the
          denial is based, a description of any additional information or
          material necessary to perfect the claim, and an explanation of the
          claims review procedure.

          A claimant is entitled to request the entire Committee to review any
          denial by written request to the Committee within 60 days of receipt
          of the denial. Absent a request for review within the 60-day period,
          the claim will be deemed to be conclusively denied. The Committee
          shall afford the claimant or his authorized representative the
          opportunity to review all pertinent documents and submit issues and
          comments in writing and shall render a review decision in writing, all
          within 60 days after receipt of a request for review (provided that in
          special circumstances the Committee may extend the time for decision
          by not more than 60 days upon written notice to the claimant). The
          Committee's review decision shall contain specific reasons for the
          decision and reference to the pertinent provisions of the Plan.

     IN WITNESS WHEREOF, the Company has caused this Agreement to be signed by
its Officers thereunto duly authorized and its corporate seal to be hereunto
affixed, and Director has hereunto set his hand and seal as of the day and year
first above written.

W.H. BRADY CO.

By:                                       By:                             (SEAL)
    ----------------------------------        ----------------------------
    Katherine M. Hudson                       Director
    President

Attest:
        ------------------------------
        Thomas E. Scherer
        Assistant Secretary

                                       6
<PAGE>

                                    AMENDMENT
                                       TO
                   DIRECTOR'S DEFERRED COMPENSATION AGREEMENT

     AGREEMENT made as of the _______ day of ________________, 20____ between
Brady Corporation, a Wisconsin Corporation ("Corporation") and
____________________ ("Director").

                               W I T N E S S E TH:

     WHEREAS, Director and Corporation are parties to a deferred compensation
agreement dated as of the ___1st_____ day of ___November_____, 1997; and

     WHEREAS, the parties wish to amend the agreement to provide the Director
with additional distribution options under the Agreement;

     NOW, THEREFORE, in consideration of the premises and the mutual benefits to
be derived herefrom, IT IS AGREED that the prior deferred compensation agreement
shall be amended in the following respects:

1.   Section 3 is amended to read as follows:

3.   DISTRIBUTIONS TO DIRECTOR FOLLOWING TERMINATION OF SERVICE

     (a)  if the Director's service as a director of the Corporation is
          terminated due to any reason, including retirement, disability, or
          death, and if no effective election exists under paragraph (b) below
          and if no application and approval under paragraph (c) below has been
          made, the Corporation shall distribute the Director's Account to
          Director, or Director's Beneficiary, under the Annual Installment
          Method over a period of ten (10) years using the Fractional Method for
          a fixed period of ten years.

     (b)  By submitting an Election Form to the Committee, provided that any
          such Election Form is submitted at least one year prior to the date of
          the Director's termination of service as a director, the Director
          shall elect whether to receive his Account balance following
          termination of service as a director in a single lump sum or under an
          Annual Installment Method. The Election Form most recently on file
          shall govern the payout of the Account. If the Director does not
          submit an Election Form or has not submitted one timely, then payment
          shall be made under paragraph (a) above unless an application has been
          made and approved under paragraph (c) below. Even if a valid election
          has been made under this paragraph (b), payment shall instead be made
          under paragraph (c) if an application has been made and approved under
          paragraph (c). The lump sum payment shall be made, or installment
          payments shall commence, within 60 days after the last day of the
          fiscal year in which the Director terminates service as a director.

<PAGE>

     (c)  Upon application of the Director (or Director's Beneficiary if
          Director is deceased), the Corporation, may if determined by the
          Committee in its uncontrolled discretion, and upon such terms and
          conditions as the Committee determines, pay Director the amount
          credited to the Account in smaller installments or in a lump sum or
          other basis.

     (d)  "Annual Installment Method" shall be an annual installment payment
          over the number of years selected by the Director, not to exceed 10.
          In each case, the Account balance of the Director shall be calculated
          as of the close of the fiscal year commencing with the last day of the
          fiscal year in which the Director terminates service as a director of
          the Corporation. Each annual installment, regardless of the method
          selected, shall be payable within 60 days after such date. The
          alternative methods available are as follows:

          (1)  Fractional Method. The annual installment shall be calculated by
               multiplying this balance by a fraction, the numerator of which is
               one, and the denominator of which is the remaining number of
               annual payments due the Director. By way of example, if the
               Director elects a 10 year Annual Installment Method, the first
               payment shall be 1/10 of the Account balance. The following year,
               the payment shall be 1/9 of the Account balance.

          (2)  Percentage or Fixed Dollar Method. The annual installment shall
               be calculated by multiplying this balance in the case of the
               percentage method, by the percentage selected by the Director and
               paying out the resulting amount, or in the case of the fixed
               dollar method, by paying out the fixed dollar amount selected by
               the Director, for the number of years selected by the Director.
               However, in the event the dollar amount selected is more than the
               Account balance in any given year, the entire Account balance
               will be distributed. Further, regardless of the method selected
               by the Director, the final installment payment will include 100%
               of the then remaining Account balance.

     (e)  The Director's account balance as of any date shall mean the number of
          stock units held in the Director's account as of such date. All
          distributions, whether in the form of lump sum payment or installment,
          shall be made in shares of the Class A nonvoting common stock of the
          Corporation equal to the portion of the number of whole stock units in
          the Director's account to be distributed under the distribution method
          selected. No distribution of fractional shares shall be made.

     (f)  "Election Form" shall mean the form established from time to time by
          the Committee that Director completes, signs and returns to the
          Committee to make an election under the Plan. To the extent authorized
          by the Committee, such form may be electronic or set forth in some
          other media and need not be signed by the Director.

                                      -2-

<PAGE>

2.   Section 4 is amended by adding the following clause (3) to paragraph (a)
     thereof:

     (3)  Upon application of the Director's Beneficiary, the Corporation may,
          if determined by the Committee in its uncontrolled discretion, and
          upon such terms and conditions as the Committee determines, pay
          Director's beneficiary the amount credited to the account in smaller
          installments or in a lump sum or other basis.

BRADY CORPORATION

By: __________________________________       By: _______________________________
                                                 Director
Title ________________________________

                                      -3-

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