THE WAGNER-SMITH COMPANY

                   DEFERRED COMPENSATION PLAN

























                                          Effective June 30, 2000


       THE WAGNER-SMITH COMPANY DEFERRED COMPENSATION PLAN


          This The Wagner-Smith Company Deferred Compensation
Plan (the "Plan") is adopted by The Wagner-Smith Company, an Ohio
corporation, (the "Company") for the purpose of providing an
inducement for continued service by designated key employees of
the Company following the acquisition of the Company by Utility
Services, Inc. ("USI").  Benefits due under the Plan constitute a
mere promise by the Company to pay benefits as the Plan provides.
Accordingly, Participants are general unsecured creditors of the
Company with respect to their benefit, and the Plan is unfunded
for tax purposes.

                            ARTICLE I
                 ADOPTION OF PLAN; PARTICIPATION

          The Plan is adopted this 30th day of June, 2000,
subject to the condition that not later than July 3, 2000, all of
the outstanding stock of the Company will be acquired by USI in a
taxable purchase.  Each person listed on Schedule A shall be a
Participant in the Plan provided that such person is an employee
of the Company in good standing on the Effective Date.

                           ARTICLE II
            VESTING; DISPOSITION OF FORFEITED SHARES

          2.1  Vesting.  Except as provided below, in order to become
entitled to receive the balance in the Participant's Account
maintained pursuant to Section 3.1, a Participant must be
continuously employed by the Company from the Effective Date
until the Vesting Date set forth opposite the Participant's name
on Schedule A (the "Vesting Date").

          A Participant who voluntarily terminates employment or
is Terminated for Cause shall forfeit the balance in the
Participant's Account effective on the date that employment
ceases.  A Participant who dies or becomes totally disabled
before the Vesting Date shall be entitled to receive the balance
in the Participant's Account maintained pursuant to Section 3.1.
If the Company terminates a Participant prior to the Vesting Date
but that termination is not within the meaning of Terminated for
Cause, the Participant shall be entitled to receive the balance
in the Participant's Account maintained pursuant to Section 3.1.

          "Terminated for Cause" means with the approval of
Philip H. Wagner a termination of a Participant's employment
whenever occasioned by (i) criminal conduct, (ii) failure of the
Participant to perform his duties with the skill, knowledge, and
diligence reasonably expected of personnel in similar positions
or refusal to carry out such reasonable tasks as reasonably
directed, (iii) refusal to perform employment duties on a full-
time basis, (iv) refusal to act in accordance with any lawful
instructions of a more senior employee, or (v) misconduct which
could be seriously damaging to the Company without a reasonable
good faith belief by the Participant that his conduct was in the
best interest of the Company.

          2.2  Disposition of Forfeited Shares.  If the MDU Shares credited
to any Participant's Account are forfeited pursuant to Section
2.1, the Company shall notify the Trustee of the forfeiture, and
the Trustee shall forthwith deliver the forfeited shares to MDU.

                           ARTICLE III
                 CREDITS AND CHARGES TO ACCOUNTS

          3.1  Account.  An Account shall be established and maintained for
each Participant, which Account shall be credited with the dollar
amounts set forth opposite the Participant's name on Schedule A.
On the Effective Date, the dollar amount credited to the account
of each Participant shall be converted into a number of MDU
Shares equal to the quotient of such dollar amount divided by the
MDU Stock Price (as defined in the Acquisition Agreement dated as
of June 30, 2000, pursuant to which the Acquisition  was
consummated).  Following such conversion, and subject to all of
the terms and conditions of this Plan, the Participants shall be
entitled to receive the MDU Shares credited to their accounts
rather than the cash amount referred to in the first sentence of
this Section 3.1.  The Participant's Account shall be charged
with distributions, income taxes and any other amounts required
to be withheld under Section 4.6.

          3.2  Earnings.  The Earnings to be credited to a Participant's
Account shall be equal to the dividends declared and paid from
time to time with respect to the number of MDU Shares then
credited to the Participant's Account.

                           ARTICLE IV
                          DISTRIBUTIONS

          4.1  No Withdrawals.  Except as otherwise provided in this article,
withdrawals are not available from a Participant's Account.

          4.2  Timing of Distribution.  The Earnings credited to a
Participant's Account shall be distributed forthwith to the Participant,
subject to tax withholding pursuant to Section 4.6.  The MDU Shares credited
to a Participant's Account shall be paid on the Vesting Date if the
Participant has been continuously employed by the Company from
the Effective Date of this Plan until the Vesting Date.

          4.3  Death Benefits.  Should a Participant die before the
Vesting Date, the Account shall be paid to the Participant's Beneficiary
under Article V, provided that the Participant has been continuously
employed by the Company from the Effective Date of the Plan until
the date of the Employee's death.

          4.4  Limitation on Distributions to Covered Employees.
Notwithstanding any other provision of this article,
if a Participant is a "covered employee" as defined in Code
Section 162(m)(3) at the time of any distribution, the maximum
amount which may be distributed from such a Participant's Account
in any Plan Year shall not exceed $1,000,000, less the amount of
compensation paid to the Participant by the Company in such Plan
Year which is not "performance-based" (as defined in Code Section
162(m)(4)(C)).  Such amount shall be reasonably determined by the
Administrator at the time of the proposed distribution.  Any
amount not distributed to a Participant in a Plan Year as a
result of the limitation set forth in this section shall be
distributed in the next Plan Year, which may again be subject to
the limitation of this section.

          4.5  Payments to Minors and Incompetents.  If any person
entitled to any payment under this Plan is, in the judgment of
the Administrator, incapable of giving receipt for such payment
because of minority, illness, infirmity or other incapacity,
the Administrator may pay the amount due such person to a duly
appointed legal representative, if there is one, or, if none,
to the spouse, children, dependents, or such other persons with
whom the person entitled to payment resides.  Any such payment
shall be a complete discharge of the liability of the Company,
its Affiliates, and the Plan with respect to such payment.

          4.6  Tax Withholding.  The Company shall deduct from
any payment or share delivery made under this Plan an amount equal
to, or shares having a value equal to, all or part of the federal, state
and local taxes required by law to be withheld by the Company
(including but not limited to any amount that may be necessary to
satisfy applicable income tax withholding and employment tax
obligations, as well as the Company's portion of all such
applicable taxes), all garnishments, and any other amounts
required to be withheld by applicable law or court order.

                            ARTICLE V
                    BENEFICIARY DESIGNATIONS

          5.1  Designation of Beneficiary.  Each Participant may
designate in the form and the manner specified by the Administrator a
Beneficiary to receive the payment (if any) due under Article IV at the
Participant's death.  The Beneficiary of a married Participant shall be his or
her spouse, unless the Participant designates a Beneficiary other
than the spouse and the spouse consents in writing to the
designation in the form and the manner prescribed by the
Administrator.  A Participant may revoke such designation at any
time and substitute therefor another Beneficiary.  A married
Participant may revoke a prior Beneficiary designation only with
the consent of his or her spouse in the form and the manner
prescribed by the Administrator.

          5.2  Failure To Designate a Beneficiary.  If upon the death of
an unmarried Participant a Beneficiary has not been validly designated,
the Beneficiary shall be the Participant's estate.

                           ARTICLE VI
                TRUST OBLIGATION TO PAY BENEFITS

          6.1  Establishment of Trust.  Immediately following the
Acquisition, MDU shall establish a Trust to hold the assets credited to the
Participants' Accounts.  The assets of any such Trust shall be
subject to the claims of MDU's creditors and the Company's
creditors and shall be maintained pursuant to a separate trust
document generally conforming to the terms of the model trust
described in Revenue Procedure 92-64.

          6.2  Benefits Paid From Trust.  Any payment required to be
made under this Plan to a Participant or Beneficiary shall be paid by
the Trustee to the extent of the assets held in the Trust by the Trustee,
and by the Company to the extent the assets in the Trust are unavailable to
pay such amount.

                           ARTICLE VII
                    ADMINISTRATION AND CLAIMS

          7.1  Plan Administration.  The Administrator shall have sole
discretionary responsibility for the operation, interpretation, and
administration of the Plan.  Any action taken on any matter
within the discretion of the Administrator shall be final,
conclusive, and binding on all parties.  In order to discharge
its duties hereunder, the Administrator shall have the power and
authority to adopt, interpret, alter, amend or revoke rules
necessary to administer the Plan, to delegate its duties and to
employ such outside professionals as may be required for prudent
administration of the Plan.  The Administrator shall also have
the right within the scope of his authority (if a designee of the
Company) to enter into agreements on behalf of the Company
necessary to administer the Plan.  Any Participant who is acting
as Administrator shall not be entitled to make decisions with
respect to his own participation and entitlement to payment under
the Plan.

          7.2  Claims Procedures

               (a)  Applicability.  This section sets forth the exclusive
procedures governing benefits under the Plan.  No legal action
may be brought by any person claiming entitlement to benefits
until after the procedures set forth herein have been exhausted.

               (b)  General Rules.  Thirty days before a Participant's Vesting
Date the Administrator shall send to the affected Participant (or
Beneficiary, as the case may be) and to the Trustee a written
notice setting forth the Participant's Account balance.  Unless
the Company notifies the Trustee prior to the Vesting Date that
the Participant has forfeited the Participant's Account, the
Trustee shall deliver the MDU Shares in Participant's Account
automatically on the Participant's Vesting Date.

               (c)  Claim for Benefits.  Any person claiming entitlement to
benefits for which the Administrator refuses to authorize payment
shall file a written claim for benefits with the Administrator at
the offices of the Company.  The claim must set forth the basis
for the claim and be signed by the claimant.

               (d)  Determination.  Within 60 days of receiving a claim for
benefits, the Administrator shall make a determination on the
claim, and notify the claimant in writing of the determination.
If the claim is approved, the Administrator shall direct the
Trustee to commence payment in accordance with the provisions of
Article IV.  If the claim is denied, in whole or in part, the
Administrator's notice to the claimant shall explain the specific
reasons for the denial, refer to the specific Plan provisions on
which the denial is based, describe any additional material or
information necessary for the claimant to perfect the claim (if
possible), and explain the steps and time limit for requesting
appeal of the determination.

               (e)  Appeal of Determination.  A claimant (or authorized
representative) shall have 60 days in which to file an appeal of
the determination, measured from the date the Administrator's
notice described in paragraph (d) is mailed.  An appeal must (i)
be in writing, (ii) set forth each ground and supporting fact on
which the appeal is based and (iii) provide any other comments
the claimant believes pertinent and helpful to his appeal.  When
making an appeal, a claimant may review the documents that were
pertinent to the Administrator's denial of his claim.  Any
claimant who fails to file an appeal timely shall be estopped and
barred from any further challenge to the Administrator's
determination to deny the claim.

               (f)  Review by Committee.  Upon receipt of a written appeal,
the Company shall appoint a committee, composed of at least 2
individuals who did not participate in the original denial of the
claim, to conduct a full and fair review of the appeal.  The
committee shall complete its review and decide the appeal within
60 days after the written appeal was received by the Company.  In
conducting its review, the committee may, in its sole discretion,
require the Company or the claimant to submit such additional
documents or other evidence as the committee deems necessary or
appropriate.  The review committee's decision shall be final and
binding on all persons with respect to the claimant's appeal.  If
the appeal is denied in whole or in part, the committee shall
notify the claimant in writing, setting forth the specific
reasons for the denial and the specific plan provisions on which
the denial is based.  The committee shall have the sole
discretion to interpret any provision of the Plan that is
pertinent to the outcome of the appeal.

          7.3  Reimbursement of Costs.  If any person institutes legal
action to enforce any of the provisions of the Plan, the prevailing
party in such legal action shall be reimbursed by the other party for
the prevailing party's costs, including, without limitation, reasonable
fees of attorneys, accountants and similar advisors, and expert
witnesses.

                          ARTICLE VIII
                          MISCELLANEOUS

          8.1  Nontransferability.  The right of a Participant or Beneficiary
to benefits under the Plan shall not be assigned, alienated,
transferred, pledged or encumbered.  Neither the Company, its
Affiliates, nor the Plan shall be liable for or subject to the
debts or liabilities of a Participant.

          8.2  Binding Effect.  The Plan shall be binding upon and inure
to the benefit of the Company, its successors and assigns, and the
Participant and his or her heirs, executors, administrators and
legal representatives.

          8.3  No Rights Implied.  No Plan provision shall confer upon any
Participant the right to continue as a member of the Board or as an employee
of the Company or any Affiliate.

          8.4  Applicable State Law.  The Plan shall be construed in
accordance with and governed by the laws of the State of Ohio.

          8.5  Entire Agreement.  The Plan constitutes the entire
understanding and agreement with respect to the subject matter contained
herein, and there are no agreements, understandings, restrictions,
representations or warranties among any Participant or
Beneficiary and the Company other than those set forth or
provided for herein.

          8.6  Amendment or Termination of Plan.  The Company may amend
or terminate the Plan at any time; provided, however, that no such
amendment or termination shall be effective if it has the effect of
eliminating or reducing a Participant's Account below the balance calculated
under the Plan immediately before giving effect to such
amendment.


                           ARTICLE IX
                           DEFINITIONS

          The following terms shall have the meanings set forth
in this article, unless a different meaning is plainly required
by the context:

          "Account" means the book entry account established and
maintained for each Participant under Section 3.1.

          "Acquisition" means taxable stock purchase.

          "Administrator" means a committee of two or more
members of the Board as selected to serve by such Board.  If no
such committee exists, then the Administrator means the Board.

          "Affiliate" means any parent corporation (within the
meaning of Code Section 424(e)) or subsidiary corporation (within
the meaning of Code Section 424(f)).

          "Beneficiary" means an individual, trust or other
entity entitled to receive payment on account of a Participant's
death.

          "Board" means the board of directors of the Company.

          "Code" means the Internal Revenue Code of 1986, as
amended.

          "Company" means The Wagner-Smith Company, an Ohio
corporation.

           "Earnings" means the amount credited to a
Participant's Account from time to time under Section 3.2.

          "Effective Date" means the closing date of the
Acquisition.

          "MDU" means MDU Resources Group, Inc., a Delaware
corporation.

          "MDU Share" means one share of the Common Stock, par
value $1.00 per share, and the associated preference share
purchase rights, of MDU.

          "Participant" means an individual named in Schedule A.

          "Plan" means The Wagner-Smith Company Deferred
Compensation Plan as set forth herein, as it may be amended from
time to time.

          "Plan Year" means each calendar year.

          "Trust" means the legal entity created by the Trust
Agreement.

          "Trust Agreement" means the trust instrument entered
among MDU, the Company and a trustee, as it may be amended from
time to time.

          "Trustee" means the trustee serving from time to time
under the Trust Agreement.

          IN WITNESS WHEREOF, The Wagner-Smith Company has caused
this Plan to be executed by a duly authorized officer effective
as of June 30, 2000.

                              THE WAGNER-SMITH COMPANY



                              By:  /s/  PHILIP H. WAGNER
                                   Philip H. Wagner, President





                           SCHEDULE A



The maximum number of shares that could be issued under this
Plan, as of the Plan's adoption date, was 85,513 shares (not
adjusted for the October 2003 three-for-two stock split).