Document:

Exhibit 10(xiii)(b)

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[STANLEY GRAPHIC OMITTED]

THE STANLEY WORKS 2001 LONG-TERM INCENTIVE PLAN
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                         Stock Option Grant Certificate

     Subject to the terms and conditions on the reverse of this Certificate,

 ________________has been awarded an Option to purchase ____ Shares as follows:

 Grant Date: __________________                Expiration Date:_________________

 25% of Option exercisable ________   Purchase Price Per Share: ________________

 25% of Option exercisable ________________
 25% of Option exercisable ________________
 25% of Option exercisable ________________

                                THE STANLEY WORKS

     As a member of Stanley's team, your skills and contributions are vital

            to our Company's and its Shareholders continued success.

      This award of stock options provides you with the opportunity to earn

        significant financial rewards for your efforts and contributions

            to making Stanley the most successful company it can be.

              On behalf of the Board of Directors, Congratulations.

                                                 ----------------------------
                                                   John F. Lundgren
                                                   Chairman and CEO
                                                   The Stanley Works

                        NON-QUALIFIED STOCK OPTION TERMS

The Stanley Works hereby grants to the Grantee named on the front of this
Certificate the option (the "Option") to purchase, on or before the Expiration
Date at the Purchase Price per Share, the Option Shares, which shall be shares
of the Common Stock of The Stanley Works, par value $2.50 per share (the "Common
Stock") all as set forth on the front of this certificate. The Option is granted
subject to the following terms and conditions and the terms and conditions of
The Stanley Works 2001 Long Term Incentive Plan, as amended from time to time
(the "Plan").

         1. VESTING AND EXERCISABILITY. The Option will become vested and
exercisable on the date (or dates) and in the percentage (or percentages) set
forth on the front of this certificate, provided the Grantee continues in
employment with Stanley or an Affiliate until the applicable vesting date. In
addition, 100% of the Option will become vested in the event of the Grantee's
termination of employment due to Retirement, Disability or death. Once vested,
the vested portion of the Option may be exercised, from time to time, from the
applicable vesting date until the earlier of (i) the Expiration Date set forth
on the front of this certificate or (ii) the applicable date described below in
paragraph 6 regarding termination of employment. Stock may be purchased
hereunder only to the extent that this Option has become vested. If, prior to
the vesting date for any portion of the Option, the Grantee's employment with
Stanley and its Affiliates terminates for any reason other than Retirement,
Disability or death, the unvested portion of the Option will be forfeited.

         2. PROCESS OF EXERCISE. The vested portion of the Option may be
exercised, in whole or in part, by written notification to Stanley's Treasurer
at Stanley's executive offices in New Britain, Connecticut, or by any other
procedure established by Stanley from time to time. Such notification shall (i)
specify the number of shares with respect to which the Option is being
exercised, and (ii) be accompanied by payment for such shares. Such notification
shall be effective upon its receipt by the Treasurer or any other party
designated by the Treasurer on or before the Expiration Date. The Option may not
be exercised with respect to a fractional share or with respect to the lesser of
100 shares or the balance of the shares then covered by the Option. In the event
the Expiration Date set forth on the front of this certificate falls on a day
which is not a regular business day at Stanley's executive offices in New
Britain, Connecticut, then such written notification must be received at such
office on or before the last regular business day prior to the Expiration Date.
Payment is to be made by check payable to the order of The Stanley Works or by
one of the alternative methods of payment described in the Plan and acceptable
to Stanley's Compensation and Organization Committee (the "Committee"). No
shares shall be issued on exercise of the Option until full payment for such
shares has been made and all checks delivered in payment therefor have been
collected. The Grantee shall not have any rights of a shareholder upon exercise
of the Option, including but not limited to, the right to vote or to receive
dividends, until stock certificates have been issued to the Grantee.

         3. TAX WITHHOLDING; ETC. Stanley shall not be required to issue any
certificate or certificates for shares purchased upon the exercise of any part
of the Option prior to (i) the admission of such shares to listing on any stock
exchange on which the stock may then be listed, (ii) the completion of any
registration or other qualification of such shares under any state or federal
law or rulings or regulations of any governmental regulatory body, (iii) the
obtaining of any consent or approval or other clearance from any governmental
agency which Stanley shall, in its sole discretion, determine to be necessary or
advisable, and (iv) the payment to Stanley, upon its demand, of any amount
requested by Stanley for withholding federal, state or local income or earnings
taxes or any other applicable tax or assessment (plus interest or penalties
thereon, if any, caused by a delay in making such payment) incurred by reason of
the exercise of the Option or the transfer of such shares. The Option shall be
exercised and shares issued only upon compliance with the Securities Act of
1933, as amended (the "Act"), and any other applicable securities laws, and the
Grantee shall comply with any requirements imposed by the Committee under such
laws. If the Grantee qualifies as an "affiliate" (as that term is defined in
Rule 144 ("Rule 144") promulgated under the Act), upon demand by Stanley, the
Grantee (or any person acting on his or her behalf) shall deliver to the
Treasurer at the time of any exercise of the Option a written representation
that upon exercising the Option he or she will acquire shares pursuant to the
Plan for his or her own account, that he or she is not taking the shares with a
view to distribution and that he or she will dispose of the shares only in
compliance with Rule 144.

         4. TRANSFERABILITY. Except as otherwise provided in the Plan, the
Option is not transferable by the Grantee otherwise than by will or by the laws
of descent and distribution, or pursuant to a qualified domestic relations
order, as defined in the Internal Revenue Code of 1986, as amended (the "Code").
More particularly (but without limiting the generality of the foregoing), the
Option may not be assigned, transferred (except as provided above), pledged or
hypothecated in any way, shall not be assignable by operation of law and shall
not be subject to execution, attachment or similar process.

         5. NO RIGHT TO EMPLOYMENT. The Option does not confer upon the Grantee
any right with respect to continuation of employment with Stanley or any
Affiliate, and will not interfere in any way with the right of Stanley or any
Affiliate to terminate the Grantee's employment.

         6. TERMINATION OF EMPLOYMENT. Notwithstanding any other provisions:

         If the Grantee's employment with Stanley and its Affiliates terminates
for any reason other than Retirement, Disability or death, the Grantee may
exercise the portion of the Option that has become vested as of the Grantee's
termination date until the earlier of (i) the Expiration Date set forth on the
front of this certificate or (ii) the last day of the two (2) month period
following such termination date. If the Grantee's employment terminates due to
Retirement, Disability or death, the Option will become immediately vested in
full and the Grantee (or, following the Grantee's death, the person designated
in the Grantee's last will and testament or if no person is designated, the
Grantee's estate) may exercise the Option until the Expiration Date set forth on
the front of this certificate.

         Leaves of absence for such periods and purposes conforming to the
personnel policy of Stanley as may be approved by the Committee shall not be
deemed terminations or interruptions of employment.

         In the event the Option is exercised by the executors, administrators,
legatees or distributees of the estate of the Grantee, Stanley shall be under no
obligation to issue shares unless Stanley is satisfied that the person or
persons exercising the Option are the duly appointed legal representatives of
the Grantee's estate or the proper legatees or distributees thereof.

         7. ADJUSTMENTS. In the event of a merger, consolidation,
reorganization, recapitalization, stock dividend, stock split or other changes
in corporate structure or capitalization affecting the Common Stock, the number
of shares remaining to be exercised under the Option and the Purchase Price
shall be appropriately adjusted by the Committee in accordance with the terms
and provisions of the Plan. If, as a result of any adjustment under this
paragraph, the Grantee becomes entitled to a fractional share, he or she shall
have the right to purchase only the adjusted number of full shares and no
payment or other adjustment will be made with respect to the fractional share so
disregarded.

         8. MISCELLANEOUS. All decisions or interpretations of the Committee
with respect to any question arising under the Plan or under the Option shall be
binding, conclusive and final. The waiver by Stanley of any provision of the
Option shall not operate as or be construed to be a subsequent waiver of the
same provision or a waiver of any other provision of the Option. The Option
shall be irrevocable during the Option period and its validity and construction
shall be governed by the laws of the State of Connecticut. The terms

                                      -2-

and conditions set forth in the Option are subject in all respects to the terms
and conditions of the Plan, which shall be controlling. Grantee agrees to
execute such other agreements, documents, or assignments as may be necessary or
desirable to effect the purposes of this the Option.

         9. BINDING EFFECT. The grant of this Option shall be binding and
effective only if this Certificate is executed by or on behalf of Stanley.

         10. CAPITALIZED TERMS. The term "Retirement" means the Grantee's
termination of employment at or after attaining the age of 55 and completing 10
years of service. The term "Disability" has the meaning provided in Section
22(e)(3) of the Code, or any successor provision. All other capitalized terms
used in this Certificate which are not defined herein or on the front of this
certificate shall have the meanings given them in the Plan unless the context
clearly requires otherwise.Exhibit 10(xiii)(c)

  Long Term Incentive Award Program for the 2.5 Year Performance Period Ending
                               December 30, 2006

I.   Description of Performance Criteria and Range of Certain Awards under the
     Long-Term Performance Award Program for the 2.5 Year Performance Period
     ending December 30, 2006.

The Long-Term Performance Award Program under the Stanley Works 2001 Long-Term
Incentive Plan for the performance period commencing July 4, 2004 and ending
December 30, 2006 provides for the grant of performance units to the members of
our senior executive team that are settled in shares of Stanley Common Stock if
and to the extent corporate financial goals are achieved over the performance
period. The performance criteria approved by the Compensation and Organization
Committee under the Long-Term Performance Award Program for the 2.5 Year Period
ending December 30, 2006 are based on achievement of corporate earnings per
share and return on capital employed targets over the 2.5 year performance
period from July 4, 2004 to December 30, 2006.

The range of performance units to be granted under the Long-Term Performance
Award Program for the 2.5 Year Period ending December 30, 2006 to our Chief
Executive Officer and other four most highly compensated executive officers for
achievement of threshold performance is from 4,853 to 21,408 performance units,
for achievement of target performance is from 9,705 to 42,818 performance units,
and for achievement of maximum performance is from 19,411 to 85,635 performance
units.

II.  Attachments.

Attached hereto are the Terms and Conditions Applicable to Long Term Performance
Award Program for the 2.5 Year Period ending December 30, 2006 and the Form of
Award Agreement for such awards.

                       Terms and Conditions Applicable to
                          Long Term Performance Awards
       issued pursuant to the Stanley Works 2001 Long Term Incentive Plan

This document sets forth the Terms and Conditions applicable to long term
performance awards ("PERFORMANCE AWARDS") issued to eligible Employees pursuant
to The Stanley Works 2001 Long-Term Incentive Plan (the "PLAN") as described in
the Award Document.

Each Performance Award represents the right of the Participant to receive a
number of Shares to be issued if the Company achieves Performance Goals for the
Measurement Period as set forth in the Award Document.

     1.   TIME AND MANNER OF SETTLEMENT. As soon as practicable following
          completion of the Company's 2006 fiscal year and assuming that the
          Threshold Performance Goals are achieved and employment requirements
          are satisfied, the Company shall issue a number of Shares to the
          Participant, in settlement of the Participant's Performance Award,
          equal to (i) the number of Shares specified in the Award Document to
          be issued based upon the Performance Goals achieved plus (ii) in the
          event performance falls between the Threshold and Target or Target and
          Maximum Goals as specified in the Award Document, a pro rata number of
          Shares calculated as follows (rounded to the closest whole number):

                  S = (A-L/N-L)x(SN-SL)

                  where:
                  S = the additional number of Shares to be issued
                  A = the actual EPS or ROCE achieved
                  L = the EPS or ROCE Goal reached
                  N = the next highest EPS or ROCE Goal
                  SN = the number of Shares designated for issuance at the next
                  highest EPS or ROCE Goal; and
                  SL = the number of Shares designated for issuance at the EPS
                  or ROCE Goal reached.

          If, at the time of settlement, the Participant meets or exceeds the
          Minimum Ownership Guidelines, Shares shall be issued in the form of
          Unrestricted Stock. If the Participant does not meet the applicable
          Minimum Ownership Guidelines at the time of settlement, the Shares
          shall be issued in the form of Restricted Stock to the extent
          necessary for such Participant to meet such Minimum Ownership
          Guidelines at the time of settlement. Any additional Shares shall be
          issued in the form of Unrestricted Stock.

     2.   RIGHTS OF A SHAREHOLDER. The Participant shall not have any rights of
          a shareholder with respect to the Performance Awards or any Shares
          issued in settlement thereof prior to the date of settlement.

     3.   TRANSFERABILITY. Transferability shall be as set forth in the Plan.

     4.   ADJUSTMENTS. Notwithstanding any other provision hereof, the Committee
          shall have authority to make adjustments in the terms and conditions
          of, and the criteria included in, Performance Awards granted
          hereunder, as set forth in the Plan.

     5.   MISCELLANEOUS. The Committee shall have full discretionary authority
          to administer the Performance Awards and to interpret the terms of the
          Award Document and this document, which authority includes the
          authority to waive certain conditions in appropriate circumstances.
          All decisions or interpretations of the Committee with respect to any
          question arising in respect of the Performance Awards shall be
          binding, conclusive and final. The waiver by Stanley of any provision
          of this document or an Award Document shall not operate as or be
          construed to be a subsequent waiver of the same provision or a waiver
          of any other provision of this document or any Award Document. The
          validity and construction of the terms of this document and any Award
          Document shall be governed by the laws of the State of Connecticut.
          The terms and conditions set forth in this document and any Award
          Document are subject in all respects to the terms and conditions of
          the Plan, which shall be controlling. The Participant agrees to
          execute such other agreements, documents or assignments as may be
          necessary or desirable to effect the purposes hereof.

     6.   UNFUNDED ARRANGEMENT. The Performance Awards represented in any Award
          Document constitute an unfunded unsecured promise of Stanley and the
          rights of the Participant in respect of the Performance Awards are no
          greater than the rights of an unsecured creditor of Stanley.

     7.   CAPITALIZED TERMS. The following capitalized terms shall have the
          meaning set forth below for purposes of any Award Document. All other
          capitalized terms used in this document shall have the meanings set
          forth in the Plan.

          AWARD DOCUMENT. A letter or combination of letters to a Participant
          that advises the Participant that he or she has been selected to
          Participate in the program and sets forth the EPS Performance Goals,
          ROCE Performance Goals and Shares at the Threshold, Target and Maximum
          Levels, signed by the Chairman of the Committee, in the case of an
          Award Document to the Chief Executive Officer, and by the Chief
          Executive Officer, in the case of an Award Document to any other
          Participant.

          EPS PERFORMANCE GOALS. Threshold, Target and Maximum earnings per
          share ("EPS") performance to be achieved over the Measurement Period
          as set forth in the Award Document.

          MEASUREMENT PERIOD. The period from July 4, 2004 through December 30,
          2006.

          MINIMUM OWNERSHIP GUIDELINES. Minimum levels of stock ownership
          Participants are expected to reach over time, as set forth in the
          Award Document.

          PERFORMANCE GOALS. EPS Performance Goals and ROCE Performance Goals as
          defined herein.

          RESTRICTED STOCK. Common Stock of the Company that confers on holders
          the right to vote and receive dividends, but that is subject to
          certain restrictions on sale and transfer. All restrictions on sale
          and transfer of such stock shall lapse on the date the Participant's
          employment with the Company or any Affiliate terminates, regardless of
          the reason for termination, provided, however, that a transfer of
          employment from the Company to any Affiliate or from any Affiliate to
          another Affiliate or to the Company shall not be deemed a termination
          of employment hereunder. In addition, if through the acquisition of
          additional Shares or otherwise, the total market value of the Shares
          owned by a Participant (restricted and unrestricted) exceeds the
          applicable Minimum Ownership Guidelines, the restrictions on the sale
          and transfer of that number of Shares of Restricted Stock in excess of
          the number required to meet the applicable Minimum Ownership
          Guidelines shall lapse.

          ROCE PERFORMANCE GOALS. Threshold, Target and Maximum return on
          capital employed ("ROCE") performance to be achieved over the
          Measurement Period as set forth in the Award Document.

          SHARES. Shares of Restricted Stock or Unrestricted Stock to be issued
          if Performance Goals are achieved, as specified in an Award Document,
          with 50% of Shares allocated to EPS Performance Goals and 50% of
          Shares allocated to ROCE Performance Goals.

          UNRESTRICTED STOCK. Common Stock of the Company that may be sold at
          any time.

                             Form of Award Agreement

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 2001 Stanley Works
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 2.5
year measurement period (7-04 through 12-06).

In conjunction with our short-term variable compensation plan (MICP) and our
stock option 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
increase if our stock price appreciates over the measurement period.

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 July 1, 2004. The initial value of each PS unit is $43.79, the
closing price of Stanley stock on July 6, 2004. The number of PS units allocated
to each participant is equivalent to 2.5 times his or her annual percentage
salary amount divided by $43.79, rounded to the closest whole number.

Your performance award covers the following number of PS units:

      ----------- ----------------- --------------- ---------------------
                      THRESHOLD         TARGET              MAX
      ----------- ----------------- --------------- ---------------------
      % OF PAY           25%             50%                100%
      ----------- ----------------- --------------- ---------------------
      # 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

                           EVP/SVP                   2X

                           Level 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. These metrics will be
established in conjunction with the Company's three-year strategic planning
process and will be communicated to you prior to year end. This will allow the
Program metrics to flex off of the Board approved three-year plan.

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.

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,

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