The remainder of their wages will only be paid if the struggling First Division side can improve their financial position.

The move follows discussions with the Professional Footballers' Association and will save the Hornets �1.3million over the next two years.

"It shows we are absolutely united in turning the financial corner here.

"The agreement of players and staff now means we can look to raise the remaining funds with confidence and launch a 'Save Our Club' campaign with fans to help us on our way.

"We will do our utmost to repay the deferred portion of salaries in the future, but we have now agreed that there are no guarantees."

Shaw insists that Watford are now within sight of being on a sound financial footing.

"On a wider football level I believe we are now in the vanguard of clubs who have taken steps - albeit tough ones - to return football clubs to some semblance of trading normality since the crash of the ITV Digital deal and its knock-on effect pulled the rug from under us.

"Since yesterday's announcement we have had many messages of support but today's agreement is a tremendous boost to us all.

"Let me reiterate we still have a way to go, but we've taken a major step on the journey."

The decision comes in the wake of comments by PFA chief executive Gordon Taylor, who has threatened to stop funding Nationwide League clubs who are not prepared to honour players' contracts.

"We have put millions into keeping clubs alive but we can't agree to this," said Taylor.

"We put a lot of money into the league but if clubs aren't prepared to honour their agreements, then we will have to look at our agreements."