PATRIOT NATIONAL BANCORP, INC.

                       2001 Stock Appreciation Rights Plan

         PATRIOT NATIONAL  BANCORP,  Inc., a corporation  organized and existing
under the laws of Connecticut  (the  "Corporation"),  has adopted its 2001 Stock
Appreciation  Rights Plan (this  "Plan") with the  intention  of  promoting  the
interests  of  the  Corporation  and  the  shareholders  of the  Corporation  by
providing  certain  officers of the  Corporation  and of its  Subsidiaries  with
appropriate  incentives  and rewards to encourage them to enter into or continue
in the employ of the Corporation and/or such Subsidiaries.

                            I. PURPOSES OF THE PLAN

         The purposes of this Plan are as follows:

     1.1.  To  provide  an  additional   incentive  for  such  officers  of  the
Corporation  and  its  Subsidiaries  to  further  the  growth,  development  and
financial  success  of the  Corporation  by  personally  benefiting  from  price
appreciation of the capital stock of the Corporation; and

     1.2. To enable the  Corporation  to obtain and retain the  services of such
officers of the Corporation  and its  Subsidiaries  considered  important to the
long-range success of the Corporation by offering them an opportunity to benefit
from the appreciation of the Corporation's capital stock which will reflect such
growth, development and financial success.

                     II. DEFINITIONS; RULES OF CONSTRUCTION

     2.1.  DEFINITIONS.  The  terms  defined  in this  Article  shall  have  the
following meanings for purposes of this Plan:

           (a)  "Actual Net  Income"  shall mean net income of the  Corporation,
calculated in accordance with GAAP for the relevant measuring period.

           (b) "Award"  means any Stock  Appreciation  Right  granted  under the
Plan.

           (c)  "Award   Agreement"   shall  mean  any  agreement   between  the
Corporation and a Participant evidencing an Award.

           (d) "Board of  Directors"  shall mean the Board of  Directors  of the
Corporation.

           (e) "Internal  Revenue Code" shall mean the Internal  Revenue Code of
1986, as amended.



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           (f) "Change in Control" means:

               (i) a change in control of the  direction and  administration  of
the Corporation's  business of a nature that would be required to be reported in
response to Item 6(e) of Schedule 14A of Regulation  14A (or any successor  rule
or  regulation)   promulgated  under  the  Exchange  Act,  whether  or  not  the
Corporation is then subject to such reporting requirements;

               (ii) any  person  (as such  term is used in  Sections  14(d)  and
14(d)(2) of the Exchange  Act but  excluding  any  employee  benefit plan of the
Corporation)  is or becomes  the  "beneficial  owner" (as  defined in Rule 13d-3
under  the  Exchange  Act),  directly  or  indirectly,   of  securities  of  the
Corporation  representing  35% or  more  of the  combined  voting  power  of the
Corporation's  outstanding  securities then entitled  ordinarily (and apart from
rights  accruing  under  special  circumstances)  to vote  for the  election  of
directors;  provided,  however,  that any  increase in  beneficial  ownership of
securities of the  Corporation  by Angelo DeCaro  (and/or his family  members or
family trusts) or Fred DeCaro (and/or his family members or family trusts) shall
not constitute a "Change in Control";

               (iii)  the  Board of  Directors  shall  approve  a sale of all or
substantially all of the assets of the Corporation;

               (iv) the Board of Directors of Patriot National Bank (the "Bank")
shall approve a sale of all or substantially all of the assets of the Bank; or

               (v) the Board of  Directors  of the  Corporation  or the Board of
Directors of the Bank shall approve any merger,  consolidation  or like business
combination or reorganization of the Corporation or the Bank, respectively,  the
consummation  of which would result in the occurrence of any event  described in
clause (ii) above.

           (g)  "Committee"  shall mean such committee of the Board of Directors
that the Board of Directors  designates to allocate  among  Participants  Awards
which may be granted  pursuant  to the terms of this Plan or, in the  absence of
any such designation,  the Board of Directors.  Any such committee so designated
by  the  Board  of  Directors   shall  be  composed  of  members  who  meet  any
qualification prescribed in Rule 16b-3.

           (h) "Common Stock" shall mean the Common Stock,  $2.00 par value,  of
the Corporation.

           (i) "Continuing  Directors" means each director of the Corporation as
of the  effective  date of this Plan and any  successor to any such director and
any  additional  director  who (i)  after  the  effective  date of this Plan was
nominated or selected by a majority of the Continuing Directors in office at the
time of his or her  nomination  or selection  and (ii) at the time of his or her
nomination  or selection is not an  "affiliate"  or  "associate"  (as defined in
Regulation  12B under the  Exchange  Act) of any  person  who is the  beneficial
owner,  directly or indirectly,  of securities  representing  25% or more of the
combined voting power of the Corporation's  outstanding securities then entitled
ordinarily to vote for the election of directors.



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           (j)  "Corporation"  shall mean  Patriot  National  Bancorp,  Inc.,  a
corporation organized and existing under the laws of Connecticut.

           (k)  "Disability"  shall mean:  (i) any physical or mental  condition
that would  qualify a Participant  for a disability  benefit under any long-term
disability plan maintained by the Corporation or a Subsidiary of the Corporation
and  applicable to such  Participant  or (ii) when used in  connection  with the
exercise of an  Incentive  Stock Option  following  termination  of  employment,
disability within the meaning of Section 22(e)(3) of the Internal Revenue Code.

           (l) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.

           (m) "Fair  Market  Value"  shall mean the average  closing  price per
share of the Common  Stock for the 10 trading  days  immediately  preceding  the
applicable  date as reported on the  composite  tape of the  principal  national
stock  exchange on which the Common Stock is then listed or, if the Common Stock
is not listed on any national  stock  exchange,  the closing  price per share of
Common Stock as reported on The NASDAQ Stock Market, Inc. If the Common Stock is
not listed on any national  stock exchange or quoted on The NASDAQ Stock Market,
Inc., Fair Market Value shall mean the average bid price per share of the Common
Stock for the 10 trading  days  immediately  preceding  the  applicable  date as
reported on such reporting system as shall be selected by the Committee.  If the
Common Stock is not publicly  traded,  the  Committee  shall  determine the Fair
Market Value to be the valuation determined by a qualified bank stock analyst or
investment banking firm specializing in bank stock.

           (n)  "For  Cause"  shall  mean  (i)  the  continued  failure  by  the
Participant substantially to perform his or her duties as an officer or employee
of the  Corporation  (other  than any  such  failure  resulting  from his or her
incapacity  due to  physical  or mental  illness)  or (ii) the  engaging  by the
Participant  in  conduct  which  is  materially  injurious  to the  Corporation,
monetarily or otherwise, in either case as determined by the Board of Directors.

           (o)  "Participant"  shall mean any officer of the  Corporation or any
Subsidiary  who is  granted  an  Award  pursuant  to  this  Plan  which  remains
outstanding.

           (p) "Plan" shall mean this 2001 Stock  Appreciation  Rights Plan,  as
amended from time to time.

           (q) "QDRO" shall mean a qualified domestic relations order as defined
in Section 414(p) of the Internal Revenue Code or Title I, Section  206(d)(3) of
the Employee  Retirement  Income  Security Act of 1974,  as amended (to the same
extent  as  if  this  Plan  were  subject  thereto),  or  the  applicable  rules
thereunder.

           (r) "Rule  16b-3"  shall  mean Rule  16b-3  under  Section  16 of the
Exchange  Act, as amended from time to time or any rule adopted in  substitution
therefor.



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           (s) "Stock  Appreciation  Amount" is the amount  that the holder of a
Stock Appreciation  Right is entitled to receive,  subject to Stock Appreciation
Restrictions  and other terms and  conditions  set forth in an Award  Agreement,
calculated to be the  appreciation in the value of a share of Common Stock as of
the  date  the  Stock  Appreciation  Right  is  exercised,  above  a base  price
established in the Award Agreement.

           (t) "Stock  Appreciation  Restriction" means the restriction on Stock
Appreciation Rights under Section 5.2.

           (u) "Stock Appreciation Rights" means an Award under Section 5.1.

           (v)  "Subsidiary"  shall mean a "subsidiary  corporation"  within the
meaning Section 424(f) of the Internal Revenue Code.

           (w) "Target Net Income" shall mean projected  consolidated net income
of the Corporation set forth in any Award Agreement  granting Stock Appreciation
Rights for purposes of calculating the Stock Appreciation Restriction.

           (x) "10% Shareholder" shall mean any person who, at the time an Award
is  granted,  owns  shares  of the  Corporation  or  any  Subsidiary  or  parent
corporation of the Corporation which possess more than 10% of the total combined
voting power of all classes of shares of the Corporation or of any Subsidiary or
parent corporation of the Corporation.

     2.2.  RULES OF  CONSTRUCTION.  For  purposes  of this  Plan  and any  Award
Agreement,   unless  otherwise  expressly  provided  or  the  context  otherwise
requires,  the terms  defined in this Plan include the plural and the  singular,
and pronouns of either  gender or neutral shall  include,  as  appropriate,  the
other pronoun forms.

                      III. CHANGE OF CONTROL; ADJUSTMENTS

     3.1.  ACCELERATION OF EXERCISABILITY UPON A CHANGE IN CONTROL. In the event
of a Change in Control of the  Corporation,  all then  outstanding  Awards shall
immediately  become exercisable in full. The Committee,  in its discretion,  may
determine  that,  upon the occurrence of a transaction  described in clauses (i)
through (v) of the  definition  of "Change in Control,"  each Award  outstanding
under this Plan shall  terminate  within  (x) a  specified  number of days after
notice to the Participant or (y) on the closing date of the  transaction  giving
rise to a Change in  Control  of the  Corporation,  and such  Participant  shall
receive,  with  respect to each share  subject to such Award,  cash in an amount
equal to the excess of the Fair Market Value of such share  immediately prior to
the occurrence of such transaction over the exercise price per share (if any) of
such Award.

     3.2.  ADJUSTMENTS.  Awards  granted  under  this Plan  shall be  subject to
adjustment as provided in Article VIII of this Plan.



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                         IV. GRANT OF AWARDS TO OFFICERS

     4.1. ELIGIBILITY.  The Committee may grant Awards, in such amounts and with
such  terms and  conditions  as the  Committee  may  determine,  subject  to the
provisions  of the Plan.  The persons  who shall be  eligible to receive  Awards
under this Article IV shall be officers of the  Corporation or its  Subsidiaries
(including officers of the Corporation or its Subsidiaries,  whether or not they
are  directors of the  Corporation  or its  Subsidiaries)  as the  Committee may
select from time to time.  Directors  who are not  employees  or officers of the
Corporation  shall not be eligible to receive Awards under this Plan. Each Award
granted  pursuant  to  this  Article  IV  shall  be  clearly  identified  in the
applicable Award Agreement as a Stock Appreciation Right. The terms of each type
of Award need not be identical,  and the Committee  need not treat  Participants
uniformly.

     4.2.  PERFORMANCE  BASED AWARDS.  The Committee may also grant Awards under
this Plan subject to the attainment of such  performance  goals as the Committee
may establish.

                          V. STOCK APPRECIATION RIGHTS

     5.1.  AWARD  DESCRIPTION.  Subject  to  the  provisions  of the  Plan,  the
Committee may grant Stock  Appreciation  Rights and impose such  restrictions or
conditions to the vesting of such Stock  Appreciation  Rights as it, in its sole
discretion,  deems  appropriate,  including the attainment of performance goals.
Each Stock  Appreciation  Right is the right to receive,  upon  surrender of the
right, but without other payment, the Stock Appreciation Amount, if any, payable
in (i) cash, (ii) shares of Common Stock or (iii) such other form or combination
of forms of payout,  at times and upon conditions (which may include a Change of
Control), as may be approved by the Committee.  Without limiting anything in the
foregoing  Plan,  the Committee  hereby  grants to each of Robert F.  O'Connell,
Philip W.  Wolford and Martin G. Noble Stock  Appreciation  Rights in respect of
6,000 shares of Common Stock.

     5.2. STOCK APPRECIATION  RESTRICTIONS.  Each Stock Appreciation Right shall
be subject to forfeiture,  in whole or in part, on the twelve month  anniversary
of the grant date according to the following  Stock  Appreciation  Restrictions:
(i) as to 100% of the Stock  Appreciation  Right,  in the event that  Actual Net
Income is less than  ninety  percent  (90%) of Target  Net Income for the fiscal
year  2001;  (ii) as to eighty  three  percent  (83%) of the Stock  Appreciation
Right,  in the event that Actual Net Income is at least ninety percent (90%) but
less than one hundred and ten percent (110%) of Target Net Income for the fiscal
year 2001;  and (iii) as to forty two  percent  (42%) of the Stock  Appreciation
Right,  in the event  that  Actual Net  Income is at least one  hundred  and ten
percent  (110%) but less than one hundred  twenty  percent  (120%) of Target Net
Income for the fiscal year 2001. No Stock  Appreciation  Restriction shall apply
in the event  that  Actual  Net Income is at least one  hundred  twenty  percent
(120%) of Target Net Income for fiscal year 2001.



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     5.3. EXERCISABILITY AND TERM OF STOCK APPRECIATION RIGHTS.

           (a) A Stock Appreciation Right shall become cumulatively  exercisable
(i) as to 20% of the Stock  Appreciation  Amount, if any, covered thereby on the
first  anniversary  of  March  31,  2001,  subject  to  the  Stock  Appreciation
Restriction;  (ii) as to an additional 20% of the Stock Appreciation  Amount, if
any, covered thereby on the second anniversary of March 31, 2001; (iii) as to an
additional 20% of the Stock Appreciation  Amount, if any, covered thereby on the
third  anniversary of March 31, 2001;  (iv) as to an additional 20% of the Stock
Appreciation  Amount, if any, covered thereby on the fourth anniversary of March
31, 2001; and (v) as to the remaining 20% of the Stock  Appreciation  Amount, if
any, on the fifth  anniversary of March 31, 2001,  unless a different  period is
provided  by the  Committee  at the time of grant  thereof.  Within  each of the
aforesaid applicable periods, each Stock Appreciation Right shall be exercisable
as of a specific date (the "Determination Date"), which Determination Date shall
be the date immediately preceding the date on which a written notice is received
by the  Corporation  via overnight mail service and the applicable  market value
shall be the closing price of the shares of the Corporation on the Determination
Date.  Alternatively,  the Participant may hand-deliver such a written notice to
the  Chairman  of the Board of the  Corporation  after the closing of the NASDAQ
market on any date during the relevant period  stipulating  that such date shall
be the Determination Date in respect of the aforesaid procedure.

           (b) The term of each Stock  Appreciation  Right  shall be a period of
ten years from the date of grant unless  otherwise  provided by the Committee at
the time of grant thereof.

     5.4. TRANSFER OF STOCK APPRECIATION  RIGHTS.  Stock Appreciation Rights may
not be sold, assigned,  transferred,  pledged or otherwise encumbered, except as
permitted  by this Plan,  prior to the first  anniversary  of the date of grant.
Following the first anniversary of the date of grant, Stock Appreciation  Rights
may not be sold, assigned, transferred,  pledged or otherwise encumbered, except
as permitted by this Plan, by will or by the laws of descent and distribution.

     5.5.  BASE  PRICE.  Unless  the  Committee  provides  otherwise,  and  such
provision is reflected in the Award Agreement, the minimum base price of a Stock
Appreciation  Right  granted  under  this  Plan  shall be not less than the Fair
Market Value of the shares of Common Stock  underlying the Award as of March 31,
2001.

                              VI. AWARD AGREEMENTS

     6.1. AWARD AGREEMENTS.  Each Award under this Plan shall be evidenced by an
Award Agreement in a form approved by the Committee  setting forth the number of
shares of  Common  Stock  subject  to the  Award,  and the price and term of the
Award.  The Award  Agreement  shall also set forth (or incorporate by reference)
the other material terms and conditions applicable to the Award as determined by
the Committee consistent with the limitations of this Plan.



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     6.2.  INCORPORATED  PROVISIONS.  Award  Agreements  shall be subject to the
terms of this Plan and shall be deemed to include the following terms:

           (a)  Non-Assignability.   The  Award  shall  not  be  assignable  nor
transferable,  except (i) by will or by the laws of descent and  distribution or
(ii)  pursuant  to a QDRO  or  any  other  exception  to  transfer  restrictions
expressly permitted by the Committee and set forth in the Award Agreement (or an
amendment  thereto).  The  restrictions  on exercise and  transfer  shall not be
deemed to prohibit, to the extent permitted by the Committee,  transfers without
consideration  for estate and financial  planning purposes and transfers to such
other persons or in such other  circumstances  as the Committee may in the Award
Agreement  expressly  permit.  During the lifetime of a  Participant,  the Award
shall be exercised  only by such  Participant or by his or her guardian or legal
representative,  except as  expressly  otherwise  provided  consistent  with the
foregoing transfer restrictions.

           (b) Rights as  Shareholder.  A Participant  shall have no rights as a
holder of Common Stock by virtue of an Award.

           (c) Withholding.  The Participant shall be responsible for payment of
any taxes or similar charges  required by law to be withheld with respect to the
exercise of an Award, and these  obligations shall be paid by the Participant on
or prior to the delivery of shares of Common Stock upon exercise of an Award.

     6.3.  CONTRACT  RIGHTS,  FORMS  AND  SIGNATURES.   Any  obligation  of  the
Corporation  with respect to an Award shall be based solely upon the contractual
obligations  created by this Plan and the applicable Award  Agreement.  No Award
shall  be  enforceable  until  the  Award  Agreement  has  been  signed  by  the
Participant and on behalf of the Corporation. By executing an Award Agreement, a
Participant  shall be deemed to have accepted and consented to the terms of this
Plan,  and any  action  taken in good  faith  under  this Plan by and within the
discretion of the Committee or its  delegates.  Except as expressly  provided in
this Plan or in an Award Agreement,  there shall be no third party beneficiaries
of the obligations of the Corporation under such Award Agreement.

                    VII. EFFECT OF TERMINATION OF EMPLOYMENT

     7.1.  TERMINATION  OF STOCK  APPRECIATION  RIGHTS.  Subject  to such  other
provisions as the Committee may set forth in the applicable Award Agreement, and
to the Committee's  amendment  authority  under the Plan,  unless the applicable
Award  Agreement  provides  otherwise,   upon  termination  of  a  Participant's
employment  with  Corporation  or a  Subsidiary  or  parent  corporation  of the
Corporation,  the  following  shall  occur with  respect  to Stock  Appreciation
Rights:

           (a)  Termination  other than for Death,  Disability or Cause.  In the
event  that the  employment  is  terminated  for any reason  other  than  death,
Disability  or  For  Cause,  (i)  Stock  Appreciation  Rights  granted  to  such
Participant,  to the  extent  that  they  are  exercisable  at the  time of such
termination,  shall remain exercisable until the date that is three months after
such termination, on which date they shall expire and (ii) such

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Stock Appreciation  Rights granted to such Participant,  to the extent that they
were not exercisable at the time of such termination,  shall expire at the close
of business on the date of such termination.  Notwithstanding the foregoing,  no
such Stock  Appreciation  Right shall be exercisable after the expiration of its
term.

           (b)  Termination  for  Death or  Disability.  In the  event  that the
employment  is  terminated  on  account  of  the  death  or  Disability  of  the
Participant,  (i) Stock Appreciation Rights granted to such Participant,  to the
extent that they were exercisable at the time of such termination,  shall remain
exercisable until the first anniversary of such termination,  on which date they
shall  expire  and  (ii)  such  Stock   Appreciation   Rights  granted  to  such
Participant,  to the extent that they were not  exercisable  at the time of such
termination,  shall  expire  at the  close  of  business  on the  date  of  such
termination.  Notwithstanding  the foregoing,  no such Stock  Appreciation Right
shall be exercisable after the expiration of its term.

           (c) Termination For Cause.  Notwithstanding the foregoing,  any Stock
Appreciation Right outstanding under this Plan shall terminate  immediately upon
any  termination  of a  Participant's  employment  with the  Corporation  or any
Subsidiary or parent corporation of the Corporation For Cause.

                               VIII. ADJUSTMENTS

     8.1. CHANGES IN CAPITALIZATION.  If there shall occur any recapitalization,
stock split (including a stock split in the form of a stock  dividend),  reverse
stock split, merger, combination,  consolidation, or other reorganization or any
extraordinary  dividend or other  extraordinary  distribution  in respect of the
Common Stock (whether in the form of cash,  Common Stock or other property),  or
any split-up,  spin-off,  extraordinary  redemption,  combination or exchange of
outstanding  shares of Common  Stock,  or there  shall  occur any other  similar
transaction  or  event  in  respect  of the  Common  Stock,  or a sale of all or
substantially  all of the assets of the  Corporation  as an  entirety,  then the
Committee  shall,  in  the  manner  and to  the  extent,  if  any,  as it  deems
appropriate and equitable to the  Participants  and consistent with the terms of
this Plan, and taking into  consideration the effect of the event on the holders
of the Common Stock:

           (a) proportionately adjust any or all of:

               (i) the number,  amount and type of Common Stock,  other property
or cash subject to any or all outstanding Awards;

               (ii) the base price of any or all outstanding Awards;

               (iii) the  securities,  cash or other property  deliverable  upon
exercise of the outstanding Awards;

               (iv) any other terms as are effected by the event; or

           (b) subject to any applicable  limitations  under generally  accepted
accounting principles, provide for:



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               (i)  an  appropriate   and   proportionate   cash  settlement  or
distribution; or

               (ii)  the  substitution  or  exchange  of any or all  outstanding
Awards.

                               IX. ADMINISTRATION

     9.1.  AUTHORITY AND  STRUCTURE.  This Plan and all Awards  granted shall be
administered by the Committee.

     9.2. CONSTRUCTION AND INTERPRETATION. The Committee shall have the power to
interpret and administer this Plan and the Award Agreements, and to adopt, amend
and rescind related rules and procedures.  All questions of  interpretation  and
determinations  with respect to this Plan,  the number of shares of Common Stock
and the terms of any Award Agreements,  the adjustments required or permitted by
Article VIII. and other determinations  hereunder shall be made by the Committee
and its  determination  shall be  final  and  conclusive  upon  all  parties  in
interest.  In the  event of any  conflict  between  an Award  Agreement  and any
non-discretionary provision of this Plan, the terms of this Plan shall govern.

     9.3. RULE 16B-3  CONDITIONS;  BIFURCATION  OF PLAN. It is the intent of the
Corporation that this Plan and the Awards  hereunder  satisfy and be interpreted
in a manner that satisfies any applicable requirements of Rule 16b-3 so that the
Participants  will be entitled to the benefits of Rule 16b-3 or other  exemptive
rules  under  Section  16 of the  Exchange  Act and  will  not be  subjected  to
avoidable  liability  thereunder  as to Awards  intended  to be  entitled to the
benefits of Rule 16b-3.

     9.4. DELEGATION AND RELIANCE. The Committee may delegate to the officers or
employees  of the  Corporation  the  authority  to  execute  and  deliver  those
instruments  and  documents,  to do all acts and  things,  and to take all other
steps deemed necessary, advisable or convenient for the effective administration
of  this  Plan  in  accordance  with  its  terms  and  purpose.  In  making  any
determination  or in taking or not  taking  any  action  under  this  Plan,  the
Committee  may  obtain  and may  rely  upon the  advice  of  experts,  including
professional  advisors to the  Corporation.  No director,  officer,  employee or
agent of the  Corporation  shall be liable for any such action or  determination
made or omitted in good faith.

     9.5.  EXCULPATION AND INDEMNITY.  Neither the Corporation nor any member of
the Committee,  nor any other person  participating in any  determination of any
question  under  this  Plan,  or  in  the   interpretation,   administration  or
application of this Plan,  shall have any liability to any person for any action
taken or not taken in good faith  under this Plan or for the failure of an Award
to qualify for  exemption or relief under Rule 16b-3 or to comply with any other
law, compliance with which is not required on the part of the Corporation.

                                X. MISCELLANEOUS

     10.1. NO SPECIAL EMPLOYMENT RIGHTS; NO RIGHT TO AWARD. Nothing contained in
this Plan or any Award or Award  Agreement shall confer upon any Participant any



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right with respect to the  continuation  of service with the  Corporation or any
Subsidiary or parent corporation of the Corporation or interfere in any way with
the right of the  Corporation  or any  Subsidiary or parent  corporation  of the
Corporation, subject to the

terms of any  separate  employment  agreement  to the  contrary,  at any time to
terminate  such  employment or to increase or decrease the  compensation  of the
Participant.

         No person shall have any claim or right to receive an Award  hereunder.
The grant of an Award to a  Participant  at any time shall  neither  require the
grant of any  other  Award to such  Participant  or other  person at any time or
preclude the Committee from making  subsequent grants to such Participant or any
other person.

     10.2. EFFECTIVE DATE. This Plan has been adopted by the Board of Directors.
This Plan shall  remain in effect  until any and all Awards under this Plan have
been  exercised,  converted or  terminated  under the terms of this Plan and the
applicable Award Agreements.

     10.3.  SHAREHOLDER  APPROVAL.  The adoption of this Plan,  or any amendment
hereto, shall be subject to approval by shareholders only to the extent required
by  (i)  the  Code,  (ii)  the  applicable   rules  of  any  stock  exchange  or
over-the-counter  stock market, or (iii) as otherwise  required by law. Any such
approval  shall be obtained  within the time  required by such law or rule.  Any
shareholder approval of this Plan or any amendment requiring such approval shall
mean the affirmative  vote of at least a majority of the shares of capital stock
present and  entitled to vote at a duly held meeting of  shareholders,  unless a
greater  vote  is  required  by  state   corporate   law,  the   certificate  of
incorporation  or  by-laws  of the  Corporation  or the  law or  rule  requiring
shareholder  approval,  in which  case such  greater  requirement  shall  apply.
Shareholder  approval may be obtained by written consent in lieu of a meeting to
the extent permitted by applicable state law.

     10.4.  COMPLIANCE  WITH LAWS. This Plan, any Award Agreement and the grant,
exercise,  conversion and operation of Awards,  and the issuance and delivery of
Common Stock and/or other  securities or property under this Plan are subject to
compliance  with all applicable  federal and state laws,  rules and  regulations
(including, but not limited to, state and federal insider trading, registration,
reporting and other securities laws and federal margin requirements) and to such
approvals by any listing,  regulatory or  governmental  authority as may, in the
opinion of counsel for the Corporation,  be necessary or advisable in connection
therewith.  Any  securities  delivered  under this Plan shall be subject to such
restrictions  (and the person  acquiring such securities  shall, if requested by
the Corporation,  provide such evidence,  assurance and  representations  to the
Corporation  as to  compliance  with any  thereof) as the  Corporation  may deem
necessary  or  desirable  to  assure   compliance  with  all  applicable   legal
requirements.

         The Corporation shall be under no obligation to effect the registration
pursuant  to  the  Securities  Act  of  1933,  as  amended,  or  any  regulation
thereunder,  of any interests in this Plan or to effect similar compliance under
any state laws.

         The transfer of any shares of Common Stock hereunder shall be effective
only at such time as counsel to the  Corporation  shall have determined that the
transfer of



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such  shares  is  in  compliance  with  all  applicable  laws,   regulations  of
governmental  authorities  and the  requirements  of any stock exchange on which
shares of Common Stock are traded.  The Committee  may, in its sole  discretion,
defer the  effectiveness  of any transfer of shares of Common Stock hereunder in
order to allow the transfer of such shares to be made  pursuant to  registration
or an exemption  from  registration  or other methods for  compliance  available
under  federal  or  state  securities  laws.  The  Committee  shall  inform  the
Participant in writing of its decision to defer the effectiveness of a transfer.
During the period of such deferral in connection  with the exercise of an Award,
the Participant  may, by written  notice,  withdraw such exercise and obtain the
refund of any amount paid with respect thereto.

     10.5.  OWNERSHIP  AND TRANSFER  RESTRICTIONS.  Common Stock  acquired  upon
exercise of Awards,  if any, shall be subject to the  restrictions  on ownership
and transfer set forth in the Award Agreement.

     10.6.  NON-EXCLUSIVITY  OF PLAN.  Nothing  in this Plan  shall  limit or be
deemed to limit the  authority  of the  Corporation  or the  Committee  to grant
awards or authorize  any other  compensation,  with or without  reference to the
Common Stock, under any other plan or authority.

     10.7.  SEVERABILITY.  In case any  provision of this Plan shall be invalid,
illegal  or  unenforceable  in any  jurisdiction,  the  validity,  legality  and
enforceability  of the remaining  provisions,  or of such provision in any other
jurisdiction, shall not in any way be affected or impaired thereby.

     10.8. EXPENSES AND RECEIPTS. The expenses of this Plan shall be paid by the
Corporation.  Any proceeds  received by the  Corporation in connection  with any
Award will be used for general corporate purposes.

     10.9.  FAILURE TO COMPLY.  In addition to the  remedies of the  Corporation
elsewhere  provided for herein,  failure by a  Participant  (or  beneficiary  or
transferee)  to comply with any of the terms and  conditions of this Plan or the
applicable Award Agreement,  unless such failure is remedied by such Participant
(or  beneficiary or transferee)  within ten days after notice of such failure by
the  Committee,  shall be grounds for the  cancellation  and  forfeiture of such
Award, in whole or in part, as the Committee,  in its absolute  discretion,  may
determine.

     10.10.  APPLICABLE  LAW.  This Plan,  any Award  Agreement  and any related
documents and matters shall be governed in accordance with the laws of the State
of Connecticut, except as to matters of federal law.