Exhibit 10(iii)(a)

                           Amended and restated as of September 21, 1998

                                 HSB Group, Inc.
                             1985 STOCK OPTION PLAN


                 ARTICLE I - PLAN ADMINISTRATION AND ELIGIBILITY

1.1  Purpose

     The purpose of the 1985 Stock Option Plan is to attract and retain  persons
     of ability as employees of the Company and its Subsidiaries and to motivate
     such  employees to exert their best efforts to  contribute to the long-term
     growth of the Company by encouraging  ownership in the Company. The Plan is
     further  designed  to promote a closer  identity  of  interest  between key
     employees  and the  Company's  stockholders.  The Plan has been amended and
     restated,  effective  January 1,  1987,  to  provide  for the  payment of a
     Related Tax Benefit upon the exercise of certain  options and for awards of
     Restricted Stock.

1.2  Definitions

     (a)  "Appreciation"  shall  mean the excess of the Fair  Market  Value of a
          share over the option price per share specified in an option agreement
          multiplied  by the  number of shares  subject to the option or portion
          thereof which is surrendered.

     (b)  "Affiliate" shall have the meaning set forth in Rule 12b-2 promulgated
          under Section 12 of the Exchange Act.

     (c)  "Beneficial  Owner"  shall  have the  meaning  set forth in Rule 13d-3
          under the Exchange Act.

     (d)  "Beneficiary"  shall mean the legal  representative of the estate of a
          deceased Optionee or the person or persons who shall acquire the right
          to  exercise  an  option or Stock  Appreciation  Right by  bequest  or
          inheritance  or by reason of the  death of the  Optionee.  In the case
          where a  Participant's  right to shares of  Restricted  Stock  vest as
          provided in Section 2.6(d) on or prior to his date of death,  the term
          "Beneficiary"  shall also mean the legal  representative of the estate
          of the  Participant  or the person or persons  who shall  acquire  the
          right to such vested shares of Stock 
<PAGE>

          by  bequest  or  inheritance  or  by  reason  of  the  death  of  such
          Participant.

     (e)  "Board" shall mean the Board of Directors of the Company.

     (f)  "Change in Control" shall be deemed to have occurred if the events set
          forth in any one of the following paragraphs shall have occurred:

               (I) any Person is or becomes the  Beneficial  Owner,  directly or
               indirectly,  of securities  of the Company (not  including in the
               securities  beneficially  owned  by such  Person  any  securities
               acquired   directly   from  the   Company   or  its   affiliates)
               representing  25% or more of the  combined  voting  power  of the
               Company's then outstanding  securities,  excluding any Person who
               becomes such a Beneficial  Owner in connection with a transaction
               described in clause (i) of paragraph (III) below; or

               (II) the following individuals cease for any reason to constitute
               a majority of the number of directors  then serving:  individuals
               who,  on  December  23,  1996,  constitute  the Board and any new
               director  (other  than a director  whose  initial  assumption  of
               office is in  connection  with an actual or  threatened  election
               contest,  including  but not  limited to a consent  solicitation,
               relating  to the  election of  directors  of the  Company)  whose
               appointment  or election by the Board or nomination  for election
               by the Company's  shareholders  was approved or  recommended by a
               vote of at least  two-thirds (2/3) of the directors then still in
               office who either were  directors  on December  23, 1996 or whose
               appointment,  election or nomination  for election was previously
               so approved or recommended; or

               (III)  there is  consummated  a merger  or  consolidation  of the
               Company or any direct or indirect  subsidiary of the Company with
               any other  corporation,  other than (i) a merger or consolidation
               which  would  result  in the  voting  securities  of the  Company
               outstanding  immediately  prior to such  merger or  consolidation
               continuing to represent  (either by remaining  outstanding  or by
               being converted into voting securities of the surviving entity or
               any parent  thereof),  in  combination  with the ownership of any
               trustee or 
<PAGE>

               other fiduciary holding securities under an employee benefit plan
               of the Company or any subsidiary of the Company,  at least 60% of
               the  combined  voting power of the  securities  of the Company or
               such  surviving   entity  or  any  parent   thereof   outstanding
               immediately after such merger or consolidation,  or (ii) a merger
               or consolidation  effected to implement a recapitalization of the
               Company (or similar transaction) in which no Person is or becomes
               the Beneficial  Owner,  directly or indirectly,  of securities of
               the Company (not including in the securities  Beneficially  Owned
               by such Person any securities  acquired directly from the Company
               or its  Affiliates)  representing  25% or  more  of the  combined
               voting power of the Company's then outstanding securities; or

               (IV) the  shareholders  of the Company approve a plan of complete
               liquidation or dissolution of the Company or there is consummated
               an agreement for the sale or disposition by the Company of all or
               substantially all of the Company's  assets,  other than a sale or
               disposition  by the  Company of all or  substantially  all of the
               Company's  assets  to an  entity,  at least  60% of the  combined
               voting  power of the  voting  securities  of which  are  owned by
               shareholders of the Company in substantially the same proportions
               as their ownership of the Company immediately prior to such sale.

          Notwithstanding  the  foregoing,  a "Change in  Control"  shall not be
          deemed  to  have  occurred  by  virtue  of  the  consummation  of  any
          transaction or series of integrated transactions immediately following
          which  the  record   holders  of  the  common  stock  of  the  Company
          immediately  prior  to such  transaction  or  series  of  transactions
          continue to have substantially the same proportionate  ownership in an
          entity  which  owns  all or  substantially  all of the  assets  of the
          Company   immediately   following   such   transaction  or  series  of
          transactions.

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

     (h)  "Committee"  shall mean the Human Resources  Committee of the Board or
          any future committee of the Board performing similar functions.

     (i)  "Company"  shall  mean  HSB Group, Inc.  except in  
<PAGE>

          determining  under Section  1.2(f) hereof whether or not any Change in
          Control of the Company has  occurred,  shall  include any successor to
          its business  and/or  assets  which  assumes this Plan by operation of
          law, or otherwise.

     (j)  "Disability"  shall mean any condition which would entitle an employee
          of the Company or a Subsidiary to receive benefits under the Company's
          Long-Term  Disability Plan or any long-term disability plan maintained
          by the Subsidiary.

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

     (l)  "Fair Market  Value" shall mean the average of the high and low prices
          per share of the  Company's  Stock as  reported  by the New York Stock
          Exchange Composite Transaction Reporting System (NYSE) on the date for
          which the Fair Market Value is being  determined,  or if no quotations
          are available for the Company's Stock, for the next preceding date for
          which such a quotation is  available.  If shares of Company  Stock are
          not then  listed on the NYSE,  Fair Market  Value shall be  reasonably
          determined by the Committee, in its sole discretion.

     (m)  "Incentive  Stock  Option"  shall mean an option  described in Section
          422A of the Code.

     (n)  "Nonstatutory  Stock  Option"  shall  mean an  option  which  does not
          qualify as an Incentive Stock Option under Section 422A of the Code.

     (o)  "Optionee"  shall  mean  an  employee  of  the  Company  or one of its
          Subsidiaries to whom an option is granted.

     (p)  "Participant"  shall  mean an  employee  of the  Company or one of its
          Subsidiaries to whom an option is granted or to whom Restricted  Stock
          is awarded.

     (q)  "Person"  shall  have the  meaning  given in  Section  3(a)(9)  of the
          Exchange  Act,  as  modified  and used in  Sections  13(d)  and  14(d)
          thereof,  except  that such term shall not  include (i) the Company or
          any of its  subsidiaries,  (ii) a trustee or other  fiduciary  holding
          securities under an employee benefit plan of the Company or any of its
          Affiliates,   (iii)  an  underwriter  temporarily  holding  securities
          pursuant  to an  offering of such  securities,  or (iv) a  corporation
          owned,  directly or indirectly,  by the shareholders of the 
<PAGE>

          Company in  substantially  the same  proportions as their ownership of
          stock of the Company.

     (r)  "Plan" shall mean HSB Group, Inc. 1985 Stock Option Plan, as amended.

     (s)  "Related Tax Benefit" shall mean the payment to an Optionee,  upon the
          exercise of a Nonstatutory Stock Option designated by the Committee as
          subject to a Related Tax Benefit, of an amount, computed in accordance
          with the  following  formula  where X equals the lower of the  percent
          established  by the  Committee at the time of grant of the Related Tax
          Benefit,  or the highest  marginal rate imposed under Section 1 of the
          Code for the taxable year in which the exercise occurs:

          (i)  X percent of the excess of the Fair Market  Value of one share of
               Stock over the  respective  option price per share  multiplied by
               the number of whole and fractional shares of Stock distributed by
               the Company to the  Optionee  with  respect to such an  exercised
               option or portion of such an option,  the Fair Market Value to be
               determined as of the date of such distribution; divided by

          (ii) One (1) minus X percent.

     (t)  "Restricted  Stock" shall mean one or more shares of Stock  awarded to
          an eligible  employee under Section 2.6 of the Plan and subject to the
          terms and conditions set forth in Section 2.6.

     (u)  "Retirement"   shall  mean  the   termination   of  employment   under
          circumstances which entitle an employee to receive retirement benefits
          under the Company's  Employees'  Retirement  Plan or any  Subsidiary's
          retirement plan.

     (v)  "Stock" shall mean the Common Stock of the Company.

     (w)  "Stock  Appreciation  Right"  shall mean a right to  surrender  to the
          Company  all or any portion of an option  and,  as  determined  by the
          Committee,  to receive in exchange  therefor  cash or whole  shares of
          Stock (valued at current Fair Market  Value) or a combination  thereof
          having an  aggregate  value  equal to the excess of the  current  Fair
          Market  Value of one (1) share over the option  price of one (1) share
          specified  in such  option  grant  multiplied  by the number of shares
          subject 
<PAGE>

          to such option or the portion thereof which is surrendered.

     (x)  "Subsidiary"  shall mean any  corporation of which at least 50% of the
          voting  stock is owned by the Company  and/or one or more of its other
          Subsidiaries.

1.3  Administration

     The Plan shall be  administered  by the  Committee  as defined  herein.  No
     member of the Committee shall be eligible to be granted an option under the
     Plan.  Each member of the  Committee  shall be a  "disinterested  director"
     within  the  meaning  of Rule 16b-3 of the  General  Rules and  Regulations
     promulgated  under the  Exchange Act and an "outside  director"  within the
     meaning  of  Section  162(m)  of the Code.  The  Committee  shall  have the
     responsibility  of interpreting the Plan and establishing and amending such
     rules and regulations  necessary or appropriate for the  administration  of
     the Plan or for the continued  qualification of any Incentive Stock Options
     granted hereunder.  In addition,  the Committee shall have the authority to
     designate the employees who shall be granted options and awarded Restricted
     Stock  under the Plan and the  amount and  nature of the  options,  related
     rights and awards to be granted to each such employee.  All interpretations
     of the Plan or of any  options,  related  rights or awards  issued under it
     made by the Committee or any  subcommittee  shall be final and binding upon
     all  persons  having an interest  in the Plan.  No member of the  Committee
     shall be liable for any action or determination taken or made in good faith
     with respect to this Plan or any option granted hereunder.

1.4  Eligibility

     Executive   and  middle   management   employees  of  the  Company  or  its
     Subsidiaries  shall be  eligible  to receive  grants of stock  options  and
     awards of Restricted Stock under the Plan.



<PAGE>


1.5  Stock Subject to the Plan

     (a)  The maximum  number of shares  which may be optioned or awarded  under
          the Plan shall be 2,600,000  shares of Stock.  Preferred  Stock may be
          used in lieu of grants  of Stock  under the Plan  subject  to  further
          authorization  of the  Board of the  Company.  The  limitation  on the
          number of shares which may be optioned or awarded under the Plan shall
          be subject to adjustment under Section 3.2 of this Plan.

     (b)  If any  outstanding  option  under  the Plan for any  reason  expires,
          lapses or is terminated, the shares of the Stock which were subject to
          such option shall be restored to the total number of shares  available
          for  grant  pursuant  to the  Plan.  Shares  as to  which  there  is a
          surrender  in whole or in part of an  option  upon the  exercise  of a
          Stock  Appreciation  Right  shall  not  again be  available  for grant
          pursuant to the Plan.  Stock  delivered  upon the  exercise of a Stock
          Appreciation  Right shall not be charged  against the number of shares
          of Stock available for the grant of options.

     (c)  Upon the  exercise  of an option  or a Stock  Appreciation  Right,  or
          payment of a Restricted  Stock award, the Company may distribute newly
          issued  shares  or  shares  previously  repurchased  on  behalf of the
          Company through a broker or other  independent agent designated by the
          Committee.  Such  repurchases  shall  be  subject  to such  rules  and
          procedures  as the  Committee  may  establish  hereunder  and shall be
          consistent with such conditions as may be prescribed from time to time
          by law or by the  Securities  and Exchange  Commission  ("SEC") in any
          rule or  regulation  or in any  exemptive  order or  no-action  letter
          issued by the SEC to the  Company  or the broker  with  respect to the
          making of such purchase or otherwise.



<PAGE>


ARTICLE  II - OPTIONS,  RELATED  TAX  BENEFITS,  STOCK  APPRECIATION  RIGHTS AND
RESTRICTED STOCK

2.1  Granting of Options

     The Committee may grant Incentive Stock Options (ISOs),  Nonstatutory Stock
     Options or any combination thereof, provided that the aggregate Fair Market
     Value (determined at the time the option is granted) of the shares of Stock
     with  respect  to  which  ISOs are  exercisable  for the  first  time by an
     employee  during any  calendar  year (under this Plan and any other  option
     plan of the Company or its Subsidiaries) shall not exceed $100,000. No such
     maximum limitation shall apply to Nonstatutory Stock Options.

2.2  Terms and Conditions of Options

     Each option granted under the Plan shall be authorized by the Committee and
     shall be  evidenced  by a  written  agreement,  in a form  approved  by the
     Committee,  containing  the following  terms and  conditions and such other
     terms and conditions as the Committee may deem appropriate:

     (a)  Option Term - Each option  agreement  shall specify the term for which
          the option  thereunder  is granted and shall  provide  that the option
          shall expire at the end of such term.  In no event shall any option be
          exercisable  any  earlier  than one year after the date of such grant.
          The Committee  shall have  authority to grant options  exercisable  in
          cumulative  or  non-cumulative   installments.   No  option  shall  be
          exercisable after the expiration of ten years from the date upon which
          such  option is  granted.  Notwithstanding  anything  to the  contrary
          contained herein, in the event of a Change in Control, all outstanding
          options shall immediately become exercisable.

     (b)  Option Price - The option price per share shall be  determined  by the
          Committee at the time an option is granted, and shall not be less than
          the Fair Market  Value of one share of Stock on the date the option is
          granted.

     (c)  Exercise of Option -

          (1)  Options may be  exercised  only by proper  written  notice to the
               Company or its duly  authorized  agent  accompanied by the proper
               amount of payment  for the  shares,  as  provided  under  Section
               2.2(d) hereunder.
<PAGE>

          (2)  No ISO granted prior to January 1, 1987 shall be exercised  while
               there is  outstanding  any other ISO  previously  granted  to the
               employee,  pursuant  to the Plan or any other plan of the Company
               or any Subsidiary (or a predecessor of any such  corporations) to
               purchase  shares  of Stock or  stock  of any  Subsidiary  (or any
               predecessor  of any  such  corporations).  For  purposes  of this
               section, an ISO shall be treated as outstanding until such option
               is  exercised  in full or expires by reason of the lapse of time.
               An ISO shall be  considered  exercised  in full when  either  the
               underlying  option or the  related  Stock  Appreciation  Right is
               exercised.

          (3)  The  Committee  may postpone any exercise of an option or a Stock
               Appreciation  Right or the delivery of Stock  following the lapse
               of certain  restrictions  with  respect  to awards of  Restricted
               Stock for such time as the Committee in its  discretion  may deem
               necessary,  in  order  to  permit  the  Company  with  reasonable
               diligence (i) to effect or maintain  registration  of the Plan or
               the shares  issuable upon the exercise of the option or the Stock
               Appreciation   Right  or  the  lapse  of   certain   restrictions
               respecting awards of Restricted Stock under the Securities Act of
               1933,  as  amended,  or the  securities  laws  of any  applicable
               jurisdiction,  or (ii) to determine that such shares and Plan are
               exempt from such registration; the Company shall not be obligated
               by virtue of any option agreement or any provision of the Plan to
               recognize  the  exercise of an option or the  exercise of a Stock
               Appreciation   Right  or  the  lapse  of   certain   restrictions
               respecting  awards of Restricted Stock to sell or issue shares in
               violation  of  said  Act or of the law of the  government  having
               jurisdiction  thereof. Any such postponement shall not extend the
               term of an option;  neither  the  Company  nor its  directors  or
               officers  shall have any  obligation or liability to the Optionee
               of an option or Stock  Appreciation  Right,  or to the Optionee's
               Beneficiary  with respect to any shares as to which the option or
               Stock   Appreciation   Right   shall   lapse   because   of  such
               postponement.

          (4)  To the extent an option is not  exercised for the total number of
               shares with respect to which such options become exercisable, the
               number of  
<PAGE>

               unexercised  shares  shall  accumulate  and the  option  shall be
               exercisable,  to such extent,  at any time thereafter,  but in no
               event  later than ten years from the date the option was  granted
               or after the expiration of such shorter period (if any) which the
               Committee  may  have  established  with  respect  to such  option
               pursuant to Subsection (a) of this Section 2.2.

     (d)  Payment of Purchase Upon Exercise - Payment for the shares as to which
          an option is exercised shall be made in one of the following ways:

          (1)  payment in cash or if  permitted by the  Committee,  by tendering
               shares of Stock of the  Company  (by either  actual  delivery  of
               shares or by attestation,  with such shares valued at Fair Market
               Value as of the day of  exercise)  held by the  purchaser  for at
               least six months; or in any combination thereof, as determined by
               the Committee; or

          (2)  if  permitted  by the  Committee,  a  Participant  may  elect  to
               authorize a third party to sell shares of Stock (or a  sufficient
               portion of the shares)  acquired  upon exercise of the option and
               remit to the Company a sufficient  portion of the sales  proceeds
               to  pay  the  entire  exercise  price  and  any  tax  withholding
               resulting from such exercise.

     (e)  Nontransferability  - No option or Stock  Appreciation  Right  granted
          under the Plan shall be transferable other than by will or by the laws
          of descent and distribution  subject to Section 2.5 hereunder.  During
          the lifetime of an  Optionee,  an option or Stock  Appreciation  Right
          shall be exercisable only by such Optionee.

     (f)  Laws and Regulations - The Committee shall have the right to condition
          any  issuance of shares to any  Optionee or  Participant  hereunder on
          such Optionee's or Participant's undertaking in writing to comply with
          such restrictions on the subsequent  disposition of such shares as the
          Committee  shall  deem  necessary  or  advisable  as a  result  of any
          applicable law or regulation. In the case of Stock issued or cash paid
          upon exercise of options or associated Stock  Appreciation  Rights, or
          payment of a Related  Tax  Benefit or the lapse of  restrictions  with
          respect to Restricted Stock awarded to a Participant under the
<PAGE>

          Plan, the Optionee,  Participant or other person  receiving such Stock
          or cash shall be required to pay to the  Company or a  Subsidiary  the
          amount of any taxes  which the  Company or  Subsidiary  is required to
          withhold  with  respect  to such  Stock  or  cash.  The  Company  or a
          subsidiary  may,  in  its  sole  discretion,  permit  an  optionee  or
          participant  or other person  receiving  such Stock or cash to satisfy
          any federal, state or local (if any) tax withholding requirements,  in
          whole or in part by (i) delivering to the Company or subsidiary shares
          of Stock held by such  optionee,  participant or other person having a
          Fair Market Value equal to the amount of the tax or (ii) directing the
          Company  or  subsidiary  to retain  Stock  otherwise  issuable  to the
          optionee,  participant  or other  person  under the Plan having a Fair
          Market  Value  equal to the  amount  of the  tax.  If Stock is used to
          satisfy tax withholding,  such stock shall be valued based on the Fair
          Market Value when the tax withholding is required to be made.

     (g)  Modification - The Committee  shall have authority to modify an option
          agreement  without the  consent of the  Optionee,  provided  that such
          modification   does  not  affect  the  exercise   price  or  otherwise
          materially  diminish  the  value  of  such  option  agreement  to  the
          Optionee,  and provided  further,  that except in  connection  with an
          amendment to the Plan, the Committee  shall not have authority to make
          any  modification to any particular  option  agreement that materially
          increases the value of the option agreement to the Optionee.

2.3  Related Tax Benefit

     (a)  The  Committee  may, but shall not be required to designate an option,
          either at date of grant of a Nonstatutory  Stock Option or thereafter,
          as being subject to a Related Tax Benefit. A Related Tax Benefit shall
          be payable to the  Optionee  only upon the exercise of the option with
          which it is  associated  and payment shall be made at the time of such
          exercise.  The  conditions  and  limitations  of a Related Tax Benefit
          shall be determined by the Committee and the Committee  shall have the
          authority to amend the formula set forth in Subsection  (s) of Section
          1.2 at any time without the consent of the Optionee.

     (b)  On and after  January 1, 1987,  an Optionee  may,  with respect to any
          unexercised Incentive Stock Option, apply to the Committee to elect to
          convert,  at  the  discretion  of  the  Committee,  such  option  to a
<PAGE>
          
          Nonstatutory  Stock  Option.  The  Committee  may,  but  shall  not be
          required to, approve such  conversion to a Nonstatutory  Stock Option.
          Effective  upon  approval of such  conversion  by the  Committee,  the
          option that was an Incentive  Stock  Option  prior to such  conversion
          shall cease to be an option  described in Section 422A of the Code and
          shall be deemed  to be a  Nonstatutory  Stock  Option.  Following  the
          approval of such conversion, the Committee may, in accordance with the
          provisions of Section 2.3(a), designate such Nonstatutory Stock Option
          as being  subject  to a Related  Tax  Benefit in  accordance  with the
          provisions of this Section 2.3.

     (c)  A Related Tax Benefit  shall be payable in cash or, at the  discretion
          of the  Committee,  in Stock or a  combination  of cash and Stock such
          that the sum of the amount of cash,  if any, and the Fair Market Value
          of the Stock (as of the date of  exercise)  is equal to the  amount of
          such Related Tax Benefit.  Payment of any Related Tax Benefit shall be
          subject to the provisions of Section 2.2(f)  respecting the payment of
          taxes which the Company or Subsidiary is required to withhold.

2.4  Stock Appreciation Rights

     (a)  The  Committee  may,  but  shall  not be  required  to,  grant a Stock
          Appreciation  Right to the  Optionee  either  at the time an option is
          granted or by  amending  the option  agreement  at any time during the
          term of such option. A Stock  Appreciation  Right shall be exercisable
          only  during the term of the option with which it is  associated.  The
          Stock  Appreciation Right shall be an integral part of the option with
          which it is associated  and shall have no existence  apart  therefrom.
          The conditions and limitations of the Stock  Appreciation  Right shall
          be  determined  by the  Committee and shall be set forth in the option
          agreement  or  amendment  thereto.   An  amendment  granting  a  Stock
          Appreciation  Right  shall not be deemed to be a grant of a new option
          for purposes of the Plan.

     (b)  A Stock Appreciation Right may be exercised by:

          (1)  filing  with the  Secretary  of the  Company a written  election,
               which  election  shall  be  delivered  by  the  Secretary  to the
               Committee specifying:

               (i)  the option or portion thereof to be surrendered; and
<PAGE>

               (ii) the  percentage  of  the  Appreciation  which  the  Optionee
                    desires to receive in cash, if any; and

          (2)  surrendering    such   option   for   cancellation   or   partial
               cancellation,  as the case may be,  provided,  however,  that any
               election to receive any portion of the Appreciation in cash shall
               be of no force or effect  unless  and until the  Committee  shall
               have consented to such election.

     (c)  No election to receive any portion of the  Appreciation  in cash shall
          be filed with the Secretary and no Stock  Appreciation  Right shall be
          exercised to receive any cash unless such election and exercise  shall
          occur during the period  (hereinafter  referred to as the "Cash Window
          Period")  beginning on the third  business day  following  the date of
          release  for  publication  by the  Company of a regular  quarterly  or
          annual  statement  of sales and  earnings  and  ending on the  twelfth
          business day  following  such date.  The  Committee may consent to the
          election  of a holder to receive any  portion of the  Appreciation  in
          cash at any time after such  election has been made.  If such election
          is consented to, the Stock  Appreciation Right shall be deemed to have
          been  exercised  during  the Cash  Window  Period  in  which,  or next
          occurring after which, the Optionee completed all acts required of him
          under the  preceding  paragraphs  to exercise  the Stock  Appreciation
          Right. Any Stock  Appreciation Right exercised during said Cash Window
          Period shall be valued and deemed exercised as of the date during such
          Cash Window Period when the average of the high and low prices for the
          shares of Stock as reported by the NYSE is the highest.

2.5  Exercise of Option or Stock  Appreciation Right in the Event of Termination
     of Employment or Death

     (a)  Options and  associated  Stock  Appreciation  Rights  shall  terminate
          immediately upon the termination of the Optionee's employment with the
          Company or a Subsidiary  unless the option  agreement of such Optionee
          provides otherwise. The conditions established by the Committee in the
          agreement  for  exercising  options  and  Stock  Appreciation   Rights
          following  termination  of  employment  are  limited by the  following
          restrictions.

          (1)  If  termination  of  employment  is by reason of the death of the
               Optionee,  no exercise by the  Optionee's  Beneficiary  may occur
               more than two years after the Optionee's death.
<PAGE>

          (2)  If  termination  of  employment  is the result of  Disability  or
               Retirement,  no exercise by the Optionee or his  Beneficiary  may
               occur  more  than  two  years   following  such   termination  of
               employment.

          (3)  If  termination  of  employment is for a reason other than death,
               Disability, Retirement or "involuntary termination for cause", no
               exercise  by the  Optionee  may  occur  more  than  three  months
               following  such   termination  of  employment.   As  used  herein
               "involuntary  termination  for cause" shall mean  termination  of
               employment  by reason of the  Optionee's  commission of a felony,
               fraud or willful  misconduct which has resulted,  or is likely to
               result,  in substantial and material damage to the Company or its
               Subsidiaries.  Whether an involuntary  termination is for "cause"
               will be determined in the sole discretion of the Committee.

     (b)  If the  Optionee  should die after  termination  of  employment,  such
          termination  being for a reason other than  Disability,  Retirement or
          involuntary  termination  for  cause,  but while  the  option is still
          exercisable,  the option or associated  Stock  Appreciation  Right, if
          any, may be exercised by the Beneficiary of the Optionee no later than
          one year from the date of termination of employment of the Optionee.

     (c)  Under no circumstances  may an option or Stock  Appreciation  Right be
          exercised by an Optionee or  Beneficiary  after the  expiration of the
          term specified in the option agreement.

2.6  Awarding of Restricted Stock

     (a)  The  Committee  shall  from  time to time in its  absolute  discretion
          select from among the  eligible  employees  the  Participants  to whom
          awards of  Restricted  Stock shall be granted and the number of shares
          subject to such awards.  Each award of Restricted Stock under the Plan
          shall be evidenced by an instrument  delivered to the  Participant  in
          such  form  as the  Committee  shall  prescribe  from  time to time in
          accordance  with the Plan. The Restricted  Stock subject to such award
          shall be registered in the name of the  Participant and held in escrow
          by the Committee during the Restricted Period (as defined herein).
<PAGE>

     (b)  Upon the award to a Participant of shares of Restricted Stock pursuant
          to Section 2.6(a), the Participant shall, subject to Subsection (c) of
          this Section 2.6,  possess all  incidents of ownership of such shares,
          including the right to receive  dividends  with respect to such shares
          and to vote such shares.

     (c)  Shares of Restricted  Stock awarded to a Participant  may not be sold,
          assigned, transferred, pledged, hypothecated or otherwise disposed of,
          except by will or the laws of descent and  distribution,  for a period
          of  five  years,  or  such  shorter  period  as  the  Committee  shall
          determine,   from  the  date  on  which  the  award  is  granted  (the
          "Restricted  Period").  The  Committee  may  also  impose  such  other
          restrictions and conditions on the shares as it deems  appropriate and
          any  attempt  to  dispose of any such  shares of  Restricted  Stock in
          contravention of such restrictions  shall be null and void and without
          effect.  In  determining  the  Restricted  Period  of  an  award,  the
          Committee may provide that the foregoing restrictions shall lapse with
          respect to specified  percentages  of the awarded shares on successive
          anniversaries  of the  date of  such  award.  In no  event  shall  the
          Restricted  Period end with  respect to  awarded  shares  prior to the
          satisfaction by the Participant of any liability arising under Section
          2.2(f).

     (d)  The  restrictions  described  in Section  2.6(c)  shall lapse upon the
          completion of the Restricted Period with respect to specific shares of
          Restricted Stock and the Participant's right to such shares shall vest
          on such  date  or,  if  earlier,  on the date  that the  Participant's
          employment   terminates  on  account  of  the  death,   Disability  or
          Retirement  of the  Participant.  The  Company  shall  deliver  to the
          Participant,  or the Beneficiary of such  Participant,  if applicable,
          within 30 days of the termination of the Restricted Period, the number
          of shares of Stock that were awarded to the  Participant as Restricted
          Stock and with respect to which the restrictions imposed under Section
          2.6(c) have lapsed,  less any stock returned by the Company to satisfy
          tax withholding pursuant to Section 2.2(f), if applicable.

     (e)  Except as provided in  Sections  2.6(d) and (f), if the  Participant's
          continuous employment with the Company or a Subsidiary shall terminate
          for any reason prior to the expiration of the Restricted  Period of an
          award, any shares remaining subject to restrictions shall thereupon be
          forfeited by the  Participant  and  
<PAGE>

          transferred  to, and  reacquired by, the Company or a Subsidiary at no
          cost to the Company or Subsidiary.

     (f)  The Committee shall have the authority (and the instrument  evidencing
          an award of  Restricted  Stock may so  provide)  to cancel  all or any
          portion of any outstanding restrictions prior to the expiration of the
          Restricted  Period  with  respect  to any or  all  of  the  shares  of
          Restricted  Stock  awarded to an employee  hereunder on such terms and
          conditions as the Committee may deem appropriate.

     (g)  In  the  event  of a  Change  in  Control,  all  restrictions  on  any
          outstanding  shares of Restricted  Stock shall lapse as of the date of
          such Change in Control.

                        ARTICLE III - GENERAL PROVISIONS

3.1  Authority

     Appropriate  officers  of  the  Company  designated  by the  Committee  are
     authorized  to  execute  and  deliver  option  agreements,  and  amendments
     thereto,  in the name of the Company,  as directed from time to time by the
     Committee.

3.2  Adjustments in the Event of Change in Common Stock of the Company

     In the event of any  change in the  Stock of the  Company  by reason of any
     stock  dividend,  stock split,  recapitalization,  reorganization,  merger,
     consolidation,  split-up,  combination,  or exchange  of shares,  or rights
     offering  to  purchase  Stock at a price  substantially  below Fair  Market
     Value, or of any similar change affecting the Stock, the number and kind of
     shares  which  thereafter  may be obtained  and sold under the Plan and the
     number  and  kind of  shares  subject  to  options  in  outstanding  option
     agreements  and the  purchase  price per share  thereof  and the  number of
     shares of Restricted  Stock awarded pursuant to Section 2.6(a) with respect
     to which all restrictions have not lapsed, shall be appropriately  adjusted
     consistent  with such change in such manner as the Board in its  discretion
     may deem  equitable to prevent  substantial  dilution or enlargement of the
     rights  granted  to,  or  available  for,  Participants  in the  Plan.  Any
     fractional  shares  resulting  from such  adjustments  shall be eliminated.
     However,  without the consent of the Optionee,  no adjustment shall be made
     in the terms of an ISO  which  would  disqualify  it from  treatment  under
     Section 421(a) of the Code or would be considered a modification, extension
     or renewal of an option under Section 425(h) of the Code.
<PAGE>

3.3  Rights of Employees

     The Plan and any  option or award  granted  under the Plan shall not confer
     upon any Optionee or  Participant  any right with respect to continuance of
     employment by the Company or any Subsidiary nor shall they interfere in any
     way with the right of the  Company or  Subsidiary  by which an  Optionee or
     Participant  is employed  to  terminate  his  employment  at any time.  The
     Company  shall not be obligated to issue Stock  pursuant to an option or an
     award of Restricted Stock for which the restrictions  hereunder have lapsed
     if such issuance  would  constitute a violation of any  applicable  law. No
     Optionee shall have any rights as a stockholder  with respect to any shares
     subject to his option  prior to the date of issuance to such  optionee of a
     certificate or certificates for such shares.  Except as provided herein, no
     Participant  shall have any  rights as a  stockholder  with  respect to any
     shares of Restricted Stock awarded to such participant.

3.4  Amendment, Suspension and Discontinuance of the Plan

     The Board may from time to time  amend,  suspend or  discontinue  the Plan,
     provided  that the Board may not,  without the approval of the holders of a
     majority  of the  outstanding  shares  entitled  to  vote,  take any of the
     following actions unless such actions fall within the provisions of Section
     3.2 herein:

     (a)  increase the number of shares reserved for options pursuant to Section
          1.5;

     (b)  alter in any way the class of persons  eligible to  participate in the
          Plan;

     (c)  permit the  granting  of any option at an option  price less than that
          provided under Section 2.2(b) hereof; or

     (d)  extend the term of the Plan or the term during which any option may be
          granted or exercised.

     No  amendment,  suspension  or  discontinuance  of the Plan shall impair an
     Optionee's rights under an option previously granted to an Optionee without
     the Optionee's consent.



<PAGE>


3.5  Governing Law

     This Plan and all  determinations  made and actions taken  pursuant  hereto
     shall be governed by the laws of the State of Connecticut.

3.6  Effective Date of the Plan

     The Plan as amended and  restated  shall be  effective  on January 1, 1987,
     subject to the  requisite  approval  of  stockholders.  No option  shall be
     granted  pursuant  to this Plan  later  than April 15,  1995,  but  options
     granted  before  such date may extend  beyond it in  accordance  with their
     terms and the terms of the Plan.