Exhibit 10-106

                              EMPLOYMENT AGREEMENT


         THIS EMPLOYMENT  AGREEMENT is made this  ________day of June,  1997, by
and between Central Maine Power Company,  a Maine corporation with its principal
place of business in Augusta,  Maine (hereinafter referred to as the "Company"),
and  MICHAEL  R.  CUTTER of  Winthrop,  Maine  (hereinafter  referred  to as the
"Executive").
         WHEREAS, the Company recognizes that the Executive is a valued employee
because  of his  knowledge  of the  Company's  affairs  and his  experience  and
leadership capabilities,  and desires to encourage his continued employment with
the Company to assure  itself of the  continuing  advantage  of that  knowledge,
experience  and  leadership  for the  benefit  of  customers  and  shareholders,
particularly  during a period of transition in various  aspects of the Company's
business and in the event of a Change of Control of the Company; and
         WHEREAS, the Executive desires to serve in the employ of the Company on
a  full-time  basis  for  a  period   provided  in  this  Employment   Agreement
(hereinafter  referred  to as the  "Agreement")  on  the  terms  and  conditions
hereinafter set forth; and
         WHEREAS,  to these ends the Company  desires to provide  the  Executive
with  certain  payments  and  benefits  in the event of the  termination  of his
employment in certain circumstances; and
         WHEREAS,  the Company and the Executive wish to set forth the terms and
conditions under which such employment and payments and benefits will occur.
         NOW,  THEREFORE,  in consideration of the continued offer of employment
by the Company and the continued acceptance of employment by the Executive,  and
the  mutual  promises  and  covenants  contained  herein,  the  Company  and the
Executive hereby agree as follows:
         1. Term of Agreement.  a. Term. The term of this Agreement  shall begin
on June 1, 1997  (hereinafter  referred  to as the  "Effective  Date") and shall
expire on May 31, 2000;  provided,  however,  that if a Change of Control occurs
during  the  period  commencing  June 1,  1999 and  ending  May 31,  2000,  this
Agreement shall be extended and shall thereafter  expire 365 days after the date
of said Change of Control (the "Extended Expiration Date").
         b. Expiration. Notwithstanding anything to the contrary in this Section
1, except as to vested  benefits,  this  Agreement  and all  obligations  of the
Company  hereunder  shall  terminate on the earliest to occur of (i) the date of
the Executive's  death,  (ii) thirty (30) days after the Company gives notice to
the Executive that the Company is  terminating  the  Executive's  employment for
reason of Total  Disability  or Cause;  or (iii) May 31,  2000 (or the  Extended
Expiration  Date specified in Section 1.a above,  if applicable,  if a Change of
Control occurs during the year prior to May 31, 2000.)
         2.  Definitions.  The following terms shall have the meanings set forth
below:
         "Affiliate"  means a person that directly or indirectly  through one or
more intermediaries  controls, is controlled by, or is under common control with
the Company.
         "Board" means the Board of Directors of the Company.
         "Cause" means any of the following events or occurrences:

          (i)  Any act of  material  dishonesty  taken by, or  committed  at the
               request of, the Executive.

          (ii) Any  illegal  or  unethical   conduct   which  would  impair  the
               Executive's ability to perform his duties under this Agreement or
               would  impair  the  business  reputation  of the  Company.  (iii)
               Conviction of a felony.

          (iv) The   continued   failure  of  the   Executive   to  perform  his
               responsibilities   and   duties   under  this   Agreement   in  a
               satisfactory  manner,  after  demand  for  performance  has  been
               delivered in writing to the  Executive  specifying  the manner in
               which the Company believes that the Executive is not performing.

          "Change  of  Control"  means the  occurrence  of any of the  following
          events:

          (i)  Any "person," as such term is used in Sections 13(d) and 14(d) of
               the  Securities  Exchange Act of 1934, as amended (the  "Exchange
               Act") (other than the Company or any  Affiliate or any trustee or
               other fiduciary holding securities under an employee benefit plan
               of the Company or any  Affiliate),  is or becomes the  beneficial
               owner, as defined in Rule 13d-3 under the Exchange Act,  directly
               or  indirectly,  of  stock  of the  Company  representing  thirty
               percent  (30%)  or  more  of the  combined  voting  power  of the
               Company's then outstanding stock eligible to vote.

          (ii) The  stockholders  of the  Company  approve a merger or  consoli-
               dation of the Company  with any other  corporation,  other than a
               merger or consolidation which would result in the voting stock of
               the Company  outstanding  immediately prior thereto continuing to
               represent (either by remaining  outstanding or by being converted
               into voting  securities of the surviving  entity) more than fifty
               percent  (50%) of the combined  voting  power of the  outstanding
               voting stock of the Company or such surviving entity  immediately
               after such merger or  consolidation;  provided,  however,  that a
               merger or consolidation  effected to implement a recapitalization
               of the Company (or similar  transaction) in which no "person" (as
               hereinabove  defined)  acquires more than thirty percent (30%) of
               the  combined  voting  power of the  Company's  then  outstanding
               securities  shall  not  constitute  a Change  of  Control  of the
               Company.

          (iii)The  stockholders  of the  Company  approve  a plan  of  complete
               liqui- dation of the Company or an agreement for the sale, lease,
               exchange  or  other   disposition   by  the  Company  of  all  or
               substantially  all of the  Company's  assets (or any  transaction
               having a similar effect).

         "Constructive  Discharge"  means,  so long as no Change of Control  has
occurred,  any reduction in the  Executive's  annual base salary in effect as of
the Effective Date of this Agreement,  or as the same may be increased from time
to time,  other than any  across-the-board  base salary reduction for a group or
all of the  executive  officers of the  Company,  and also means,  on or after a
Change of Control,

          (i)  any reduction in the Executive's  annual base salary in effect as
               of the Effective  Date of this  Agreement,  or as the same may be
               increased from time to time;

          (ii) a substantial reduction in the nature or scope of the Executive's
               responsibilities,  duties or  authority  from those  described in
               Section 3.c of this Agreement; (iii) a material adverse change in
               the  Executive's  title or position;  or (iv)  relocation  of the
               Executive's  place of  employment  from the  Company's  principal
               executive  offices  to a place more than  twenty-five  (25) miles
               from Augusta, Maine without the Executive's consent.

     "Severance  Benefits" means the benefits set forth in Section 5.a or 5.c of
this Agreement.

     "Total  Disability"  means the  complete  and  permanent  inability  of the
Executive to perform all of his duties under this Agreement on a full-time basis
for a period of at least six (6)  consecutive  months,  as  determined  upon the
basis of such evidence, which may include independent medical reports and data.

         3. Employment.  a. Position.  The Company hereby agrees to continue its
employment  of the  Executive  in the  capacity  of Vice  President,  Operations
Support,  and the Executive hereby agrees to remain in the employ of the Company
for the period  beginning on the Effective  Date and ending on the date on which
the Executive's  employment is terminated in accordance with this Agreement (the
"Employment Period").  This Agreement shall not restrict in any way the right of
the Company to terminate  the  Executive's  employment  at whatever time and for
whatever  reason  it deems  appropriate,  nor  shall it limit  the  right of the
Executive  to  terminate  employment  at any time for  whatever  reason he deems
appropriate.
         b. Performance.  The Executive agrees that during the Employment Period
he  shall  devote  substantially  all his  business  attention  and  time to the
business  and  affairs  of the  Company,  and use his best  efforts  to  perform
faithfully  and  efficiently  the duties and  responsibilities  of the Executive
under this  Agreement.  It is expressly  understood  that (i) the  Executive may
devote a reasonable amount of time to such industry  associations and charitable
and civic endeavors as shall not materially interfere with the services that the
Executive is required to render under this Agreement, and (ii) the Executive may
serve as a member of one or more boards of directors  of companies  that are not
affiliated  with the Company  and do not compete  with the Company or any of its
Affiliates.
         c. Job Duties.  The following listing of job duties shall represent the
Executive's primary responsibilities. Such responsibilities may be expanded and,
so long as no Change of Control has  occurred,  may be decreased as the business
needs of the Company require. The Executive's primary job responsibilities shall
include,  but not be limited to, leadership of the Operations  Support functions
(Accounting,   Treasury,   Information   Services,   Corporate   Communications,
Government Affairs, Rates and Revenue Requirements,  Law and Regulatory Services
and Human  Resources)  in the areas of internal  customer  focus,  management of
support services in competitive markets, and transitioning the Company's support
services,  systems and processes to a competitive  electric  market,  as well as
management of the Human Resources function.
         4.  Compensation  and Benefits.  a. During the Employment  Period,  the
Executive shall be compensated as follows:
         (i)      Salary. The Executive shall receive an annual base salary, the
                  amount of which shall be  reviewed  regularly  and  determined
                  from  time  to  time,   but  which  shall  not  be  less  than
                  $125,000.00.  His salary shall be payable in  accordance  with
                  Company payroll practices.
         (ii)     Participation  in  Executive  Plans.  He shall be  entitled to
                  participate  in any and all plans and programs  maintained  by
                  the  Company  from time to time to  provide  benefits  for its
                  executives,  including  without  limitation  any short-term or
                  long-term  incentive plan or program,  in accordance  with the
                  terms  and  conditions  of any  such  plan or  program  or the
                  administrative  guidelines relating thereto, as may be amended
                  from time to time.
         (iii)    Participation in Salaried  Employee Plans. The Executive shall
                  be entitled to  participate  in any and all plans and programs
                  maintained  by the  Company  from  time  to  time  to  provide
                  benefits  for  its  salaried  employees  generally,  including
                  without limitation any savings and investment,  stock purchase
                  or  group  medical,   dental,  life,  accident  or  disability
                  insurance  plan  or  program,   subject  to  all   eligibility
                  requirements  of general  applicability,  to the  extent  that
                  executives are not excluded from  participation  therein under
                  the terms thereof or under the terms of any executive  plan or
                  program or any approval or adoption thereof.
         (iv)     Other Fringe Benefits.  The Executive shall be entitled to all
                  fringe benefits  generally provided by the Company at any time
                  to  its  full-time  salaried   employees,   including  without
                  limitation   paid  vacation,   holidays  and  sick  leave  but
                  excluding   severance   pay,  in  accordance   with  generally
                  applicable Company policies with respect to such benefits.
         b.  Retention  Bonus.  If the  Executive  is  actively  employed by the
Company on the earlier to occur of (i) the date of the sale of the  Transmission
and  Distribution  Business Unit, or (ii) May 31, 2000,  the Executive  shall be
entitled to receive a lump sum cash payment of one-half (1/2) of the Executive's
annual  base salary then in effect,  which  shall be paid  within  fifteen  (15)
working  days after the  applicable  date  specified in  subsection  (i) or (ii)
above.  If the  Executive's  employment is terminated for any reason  whatsoever
prior to the  earlier of such  dates,  he shall not be  entitled  to receive the
retention  bonus  described  herein,  although  he may be  entitled  to  receive
Severance Benefits as provided in Section 5 below.
         c. Withholding.  All compensation payable under this Section 4 shall be
subject to normal  payroll  deductions  for  withholding  income  taxes,  social
security taxes and the like.
         5. Severance Benefits.  a. Change of Control.  If, on or after a Change
of Control, the Executive's employment with the Company is terminated during the
Employment  Period by the Company and/or any successor for any reason other than
death,  Total  Disability  or Cause,  or by the  Executive  within  twelve  (12)
calendar  months  of a  Constructive  Discharge,  Severance  Benefits  shall  be
provided as follows:

          (i)  The Company  shall pay the  Executive,  in one lump sum cash pay-
               ment, within sixty (60) days following the date of termination of
               employment as defined in Section 6 below,  an amount equal to 2.0
               times the Executive's then-current base salary.

          (ii) The Company  shall  provide the Executive  with  so-called  COBRA
               medi- cal continuation  coverage paid by the Company for a period
               up to  eighteen  (18)  months,  or until  the  Executive  obtains
               coverage under another group medical plan with another  employer,
               whichever occurs first.

          (iii)The Company shall pay a fee to an independent  outplacement  firm
               selected by the Executive for outplacement  services in an amount
               equal  to the  actual  fee for  such  services  up to a total  of
               $10,000.

     b.  Parachute  Provision.  Notwithstanding  the  provisions  of Section 5.a
hereof, if, in the opinion of tax counsel selected by the Company's  independent
auditors,

          (i)  the Severance Benefits set forth in said Section 5.a and any pay-
               ments  or  benefits  otherwise  payable  to the  Executive  would
               constitute  "parachute  payments"  within the  meaning of Section
               280G(b)(2) of the Internal  Revenue Code of 1986, as amended (the
               "Code") (said  Severance  Benefits and other payments or benefits
               being hereinafter  collectively referred to as "Total Payments"),
               and

          (ii) the aggregate  present value of the Total  Payments  would exceed
               2.99 times the  Executive's  base  amount,  as defined in Section
               280G(b)(3)  of the Code,  then,  such  portion  of the  Severance
               Benefits  described  in Section  5.a hereof as, in the opinion of
               said  tax  counsel,  constitute  "parachute  payments"  shall  be
               reduced as directed by tax counsel so that the aggregate  present
               value  of  the  Total   Payments  is  equal  to  2.99  times  the
               Executive's  base amount.  The tax counsel  selected  pursuant to
               this Section 5.b may consult with tax counsel for the  Executive,
               but shall have complete,  sole and final  discretion to determine
               which Severance  Benefits shall be reduced and the amounts of the
               required  reductions.  For  purposes  of this  Section  5.b,  the
               Executive's base amount and the value of the Total Payments shall
               be determined by the Company's independent auditors in accordance
               with the  principles  of Section  280G of the Code and based upon
               the advice of tax counsel selected thereby.

         c. No Change of Control. If no Change of Control has occurred,  and the
Executive's  employment  with the Company is  terminated  during the  Employment
Period  either  (i) by the  Company  for any  reason  other  than  death,  Total
Disability or Cause, or (ii) by the Executive  within six (6) calendar months of
a Constructive  Discharge,  the Company shall pay the Executive, in one lump sum
payment  within sixty (60) days  following the date of termination of employment
as defined in Section 6 below,  an amount equal to one (1) times the Executive's
annual  base  salary  in effect on the date  immediately  preceding  the date of
termination, or preceding the date of a Constructive Discharge attributable to a
base salary reduction if applicable.
         6. Date of  Termination.  For purposes of this  Agreement,  the date of
termination of the Executive's  employment  shall be the date notice is given to
the  Executive  by the  Company  and/or  any  successor  or,  in the  case  of a
Constructive  Discharge,  the date set  forth in a written  notice  given to the
Company by the Executive,  provided that the Executive  gives such notice within
twelve  (12)  calendar  months of the  Constructive  Discharge  in the case of a
Change of  Control,  and  within  six (6)  calendar  months of the  Constructive
Discharge in other  cases,  and  specifies  therein the event  constituting  the
Constructive Discharge.
         7.  Taxes.  a.  Gross-Up  Amount.  In the event that any portion of the
Severance  Benefits  provided in Section 5 is subject to tax under Code ss.4999,
or any successor  provision thereto (the "Excise Tax"), the Company shall pay to
the Executive an additional amount (the "Gross-Up  Amount") which, after payment
of all federal and State income taxes thereon  (assuming the Executive is at the
highest  marginal  federal and applicable State income tax rate in effect on the
date of payment of the  Gross-Up  Amount)  and  payment of any Excise Tax on the
Gross-Up  Amount,  is equal to the Excise Tax payable by the  Executive  on such
portion of the Severance  Benefits.  Any Gross-Up Amount payable hereunder shall
be paid by the Company  coincident  with the payment of the  Severance  Benefits
described in Section 5.a of this Agreement.
         b. Tax  Withholding.  All amounts  payable to the Executive  under this
Agreement shall be subject to applicable  withholding of income,  wage and other
taxes.
         8. Non-Competition,  Confidentiality and Cooperation.  a. The Executive
         agrees  that:

          (i)  During  the  Employment  Period  and for one (1) year  after  the
               termination of the  Executive's  employment  with the Company for
               any reason other than a Change of Control,  the  Executive  shall
               not serve as a director, officer, employee, partner or consultant
               or in any other  capacity in any business that is a competitor of
               the Company, or solicit Company employees for employment or other
               participation  in any such  business,  or take any  other  action
               intended to advance the  interests  of such  business;  provided,
               however,  that this  Section  8.a.(i)  shall not apply  after the
               termination  of  the  Executive's  employment  if  the  Executive
               voluntarily  terminates employment and is not eligible to receive
               a Severance Benefit under Section 5.c. above.

          (ii) During and after the Executive's  employment with the Company, he
               shall not  divulge  or  appropriate  to his own use or the use of
               others any secret,  proprietary  or  confidential  information or
               knowledge  pertaining  to the business of the Company,  or any of
               its Affiliates, obtained during his employment with the Company.

          (iii)During the  Employment  Period,  he shall  support the  Company's
               interests and efforts in all regulatory, administrative, judicial
               or  other  proceedings  affecting  the  Company  and,  after  the
               termination of his employment with the Company, he shall use best
               efforts to comply  with all  reasonable  requests  of the Company
               that he cooperate with the Company,  whether by giving  testimony
               or otherwise,  in regulatory,  administrative,  judicial or other
               proceedings  affecting the Company except any proceeding in which
               he may be in a position adverse to that of the Company. After the
               termination  of  employment,  the  Company  shall  reimburse  the
               Executive  for  his  reasonable  expenses  and  his  time,  at  a
               reasonable rate to be determined, for the Executive's cooperation
               with the Company in any such proceeding.

          (iv) The  term  "Company"  as  used in this  Section  8 shall  include
               Central Maine Power Company, any Affiliate of Central Maine Power
               Company (determined as of the date of termination), any successor
               to the  business  or  operations  of Central  Maine Power and any
               business   entity   spun-off,   divested,   or   distributed   to
               shareholders which shall continue the operations of Central Maine
               Power Company.

The  provisions of this Section 8 shall survive the expiration or termination of
this  Agreement.  The  Executive  agrees that the  Company  shall be entitled to
injunctive   relief  to  prevent  any  breach  or  threatened  breach  of  these
provisions.  In the event of a failure to comply with part (i), (ii) or (iii) of
this  Section 8, the  Executive  agrees that the  Company  shall have no further
obligation to pay the Executive  any  Severance  Benefits  under Section 5.c. of
this Agreement.
         9. No Mitigation.  The Executive  shall not be required to mitigate the
amount  of  any  payment  provided  for  in  this  Agreement  by  seeking  other
employment.
         10.  Assignment.  This Agreement and the rights and  obligations of the
Company  hereunder  shall inure to the benefit of and shall be binding  upon the
successors  and  assigns  of  the  Company,  including  without  limitation  any
corporation or other entity acquiring all or  substantially  all of the business
or  assets  of the  Company  whether  by  operation  of law or  otherwise.  This
Agreement and the rights of the Executive  hereunder  shall not be assignable by
the Executive, and any assignment by the Executive shall be null and void.
         11.  Arbitration.  Any  dispute  or  controversy  arising  under  or in
connection  with this Agreement  shall be settled  exclusively by arbitration in
Augusta,  Maine,  in  accordance  with  the  rules of the  American  Arbitration
Association  then in effect.  The  pendency of any such  dispute or  controversy
shall not affect any rights or obligations under this Agreement. Judgment may be
entered on the arbitrator's award in any court having jurisdiction.
         12. Waiver;  Amendment.  The failure of either party to enforce, or any
delay in enforcing,  any rights under this Agreement shall not be deemed to be a
waiver of such rights, unless such waiver is an express written waiver which has
been signed by the waiving  party.  Waiver of any one breach shall not be deemed
to be a waiver of any other  breach of the same or any other  provision  hereof.
This  Agreement can be amended only by written  instrument  signed by each party
hereto and no course of dealing  or  practice  or failure to enforce or delay in
enforcing  any rights  hereunder may be claimed to have effected an amendment of
this Agreement.
         13. Singular  Contract.  This Agreement is a singular agreement between
the Executive and the Company,  and is not part of a general "plan" or "program"
for employees as a group.  This  Agreement  shall,  under no  circumstances,  be
deemed to be an "employee  welfare benefit plan" or an "employee pension benefit
plan"  as  defined  in the  Employee  Retirement  Income  Security  Act of  1974
(hereinafter referred to as "ERISA"). Notwithstanding,  the Company may submit a
letter to the  Department of Labor  indicating the possible  establishment  of a
so-called  unfunded  "top  hat"  plan  for the  benefit  of a  select  group  of
management and highly compensated employees to avoid the costs and uncertainties
which may  occur in the  event of a  Department  of Labor  audit  and  challenge
relative to compliance with any allegedly  applicable  provisions of ERISA.  The
Executive specifically  acknowledges and agrees that the filing of the so-called
"top hat" letter notice by the Company shall not be construed or  interpreted as
an admission on the part of the Company that this Agreement constitutes an ERISA
plan,  and the Company hereby  categorically  states,  and the Executive  hereby
agrees, that this Agreement is an ad hoc individual contract with the Executive.
         14.  Notices.  Any notice  required or permitted to be given under this
Agreement shall be sufficient if in writing and sent by first-class,  registered
or certified  mail or  hand-delivered  to the  Executive  at the last  residence
address he has  provided to the Company or, in the case of the  Company,  at its
principal executive offices to the attention of the Corporate Secretary.
         15. Titles and Captions.  The section and paragraph titles and captions
contained  herein  are for  convenience  only and shall not be held to  explain,
modify,  amplify, or aid in the  interpretation,  construction or meaning of the
provisions of this Agreement.
         16.  Miscellaneous.  This Agreement  shall be construed and enforced in
accordance with the laws of the State of Maine. In the event that any provisions
of this Agreement shall be held to be invalid, the other provisions hereof shall
remain in full force and effect.
         17. Entire  Agreement.  The terms of this Agreement are intended by the
parties  to be the final  expression  of their  agreement  with  respect  to the
employment  of the  Executive  by the  Company  and may not be  contradicted  by
evidence of any prior or contemporaneous oral or written agreement.
         IN WITNESS  WHEREOF,  the parties  hereto have executed this  Agreement
effective as of the date first written above.

WITNESS:


-----------------------------               ---------------------------------
                                            Michael R. Cutter


WITNESS:                                    CENTRAL MAINE POWER COMPANY


-----------------------------               ---------------------------------
                                            By:      David M. Jagger
                                                     Chairman of the Board
                                                     of Directors