EX-10.XI.D







Exhibit 10(xi)(d)



[Date]




Dear •:



It is my pleasure to congratulate you for being selected to participate in the Long Term
Performance Award Program (the “Program”) under The Stanley Works 2001 Long-Term Incentive Plan.
This Program is intended to provide substantial, equity-based rewards for specified full-time
members of our senior executive team, provided specific Corporate goals are achieved during the
Program’s three year measurement period (fiscal years •-•).



In conjunction with our short-term variable compensation program (MICP) and our stock
option/restricted stock unit program, the Program is an important addition to your total
compensation package, and provides a strong additional incentive to continue increasing shareholder
value.




Bonus Opportunity 



Each participant will have an opportunity to earn a number of Performance Shares (PS) based upon
achievement of corporate financial goals, and may earn additional performance shares if the
corporate financial goals are exceeded. Each PS unit represents one share of Stanley Common Stock
and, accordingly, the potential value of a participant’s performance award under the Program may
change as our stock price changes.



Each participant is allocated a threshold, target and maximum number of PS units based upon
assigned percentages of his or her annual base salary at the rate in effect as of January 1, •
[year in which award is made]. The initial value of each PS unit is $•, the average of the high
and low price of Stanley stock on • [date on which award is approved].



Your performance award covers the following number of PS units:




	 	 	 	 	 	 	 
	 	 	Threshold	 	Target	 	Max
	% of Pay

	 	•
	 	•
	 	•
	# PS

	 	•
	 	•
	 	•






Vesting and Settlement



Performance awards will become vested at the time of settlement to the extent that the applicable
performance metrics have been achieved and provided that the participant is continuously employed
by Stanley until such time. Performance awards will be settled in shares of Stanley stock as soon
as practicable following the end of the measurement


 









 






period. The shares will be distributed in the form of restricted stock to the extent the
participant does not hold the number of shares specified in the minimum stock ownership guidelines
for executives at the time of settlement. Participants will be entitled to vote and receive
dividends on restricted stock following the date of distribution.



The Minimum Ownership Guidelines are as follows:




	 	 	 	 	 
	Position	 	Multiple of Base Salary	 	 
	CEO

	 	3X	 	 
	Level 1

	 	2X	 	 
	Levels 2 and 3

	 	1X	 	 





If a participant’s employment with Stanley terminates due to his or her retirement, death or
disability prior to the date the performance awards are settled, the participant’s performance
award will be pro-rated based on the number of days in the measurement period that the participant
was employed by Stanley. The participant’s pro-rated performance award will be settled at the same
time as performance awards for active participants are settled, to the extent the applicable
performance metrics have been achieved. Pro-rated performance awards will be settled in the form
of unrestricted shares of Stanley common stock. A participant whose employment with Stanley
terminates prior to the date of settlement for any other reason will forfeit all rights in respect
of his or her performance award and will not be entitled to receive any shares of Stanley stock or
other payment under the Program.




Financial Measurements




The Corporate financial goals for this Program will consist of two equally weighted metrics, one
based on EPS and one based on ROCE, as set forth in the attached document entitled LTIP Corporate
Goals.


Although this summary includes the key aspects of the Program, it is not intended to represent a
full accounting of the rules and regulations applicable to the Program and is subject to the terms
described in the enclosed Terms and Conditions Applicable to Long Term Performance Awards and The
Stanley Works 2001 Long-Term Incentive Plan, which together with this document govern the Program.
Please note that the Terms and Conditions enclosed here apply to all outstanding Performance
Awards.



If you have any questions, please call me, Jim Loree or Mark Mathieu. Once again, thank you for
your continued support and congratulations on being selected to participate in this important
Program.



Best regards,