<PAGE>   1
                                                                     Exhibit 10x

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


                                A G R E E M E N T
                                -----------------


            This AGREEMENT made and entered into as of the first day of May,
1995 by and between FALL RIVER GAS COMPANY, a Massachusetts corporation
hereinafter referred to as the "Company", and the UTILITY WORKERS UNION OF
AMERICA, affiliated with the AFL-CIO and Local Union No. 431, and the employees
of the Company as hereinafter defined, who are now or may hereafter become
members of said Local Union, hereinafter called the "Union".

                               W I T N E S S E T H
                               -------------------

      WHEREAS, following a representation election held on December 19, 1957,
under the supervision of the National Labor Relations Board, the Board
certified, on December 30, 1957, the Utility Workers Union of America, AFL-CIO,
as the representative of the employees of the Distribution Department of the
Company as hereinafter defined; and

            WHEREAS, following a representation election held on May 2, 1949,
under the supervision of the National Labor Relations Board, the Board
certified, on May 2, 1949, the Utility Workers Union of America, C.I.0., as the
representative of the employees of the Production Department of the Company as
hereinafter defined, and

            WHEREAS, the Company has agreed to the merger of Local 431 and 382
and also agreed to negotiate with Local 431, the Local resulting from said
merger; and

            WHEREAS, the purpose of this Agreement is to provide orderly
collective bargaining relations, to secure prompt and equitable disposition of
grievances; to establish rates of pay, wages, hours of employment, seniority and
other conditions of employment, to promote harmony and efficiency; to prevent
strikes and lockouts; all to the end that there may be an adequate and
uninterrupted supply of gas service in the territory and communities served by
the Company;


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<PAGE>   2

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995






































                                       2




<PAGE>   3
             Agreement: Fall River Gas Company and Local 431 UMUA
                              Dated: May 1, 1995

                                      
         NOW, THEREFORE, the Company and the Union contract and agree with
each other as follows:
                                    ARTICLE I
                                    ---------

                                   Recognition
                                   -----------

            SECTION 1. The Company recognizes the Union as the exclusive
representative for the purposes of collective bargaining of all employees in the
Distribution Department of the Company, excluding office employees, clerks,
watchmen, guards, and professional, executive and administrative firm personnel,
including foremen and supervisors.

            SECTION 2. The Company recognizes the Union as the exclusive
representative for the purpose of collective bargaining of all employees in the
Production Department, but excluding Superintendent, Assistant Superintendent,
Chief Chemist, Laboratory Assistants, Student Engineers, Chief Clerk, Clerk,
Engineer in Charge, Master Mechanic, Assistant Master Mechanic, Foreman Engineer
- Class A, Foreman Engineer - Class B, Yard Foreman, Generator House Foreman,
Natural Gas Dispatcher, Instrument Technician, Utility Engineers, Executives,
Guards, Office Clerical and Professional employees and other supervisory
employees with authority to hire, promote, discharge, discipline or otherwise
effect changes in the status of employees or effectively to recommend such
action, all as defined in the Act.

                                   ARTICLE II
                                   ----------

                               Scope of Agreement
                               ------------------

            SECTION 1. The provisions of this Agreement shall apply only to
"regular employees" in the bargaining unit, described in Article I above,
"regular employees" being hereby defined to mean employees who are regularly
employed and excluding probationary and temporary employees as defined
hereinafter.

            SECTION 2. "Probationary employees" are defined as those hired on
sixty (60) days' trial, either to fill regular authorized positions, which are
open or expected to be open, or to fill new positions, to be authorized. Any
such employees who shall have been employed 


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<PAGE>   4
              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



sixty (60) days from date of hiring shall then become entitled to the benefits
of this contract, except that they may be released from employment by the
Company at any time during the first six (6) months following date of hiring
without assigning any cause therefor, and such release from employment shall not
be subject to the grievance procedure of this contract. A released employee who
is later rehired shall have his time originally worked accumulated and added to
his time later worked for purpose only of determining completion of his trial
period of six (6) months, but without affecting his sixty (60) day probationary
period; provided, however, that on such later rehiring he must be employed no
less than sixty (60) days to complete his trial period and his probationary
period.

        SECTION 3. A. "Temporary Employees" are defined to include such
temporary employees as the Company may, in its discretion, hire for emergencies,
vacation relief, or in other similar situations of a temporary nature. Seniority
shall not apply to such temporary employees, and they shall not be entitled to
any of the benefits of this Agreement.

                   B. The Company may, in its discretion, temporarily 
assign employees from one department of the Company to another department. Such 
employees shall retain their seniority in the department of the Company from 
which they have been temporarily assigned.

                   C. If an employee istemporarily assigned for at least 
six (6) hours, to a position with a higher wage classification, said employee 
shall be compensated at the higher wage for the entire shift. Under no
conditions will a temporarily assigned employee ever be compensated at a wage 
rate that is less than his normal straight time rate.


        SECTION 4. The Company shall notify the Union in writing as and when any
probationary or temporary employee is hired.

                                   ARTICLE III
                                   -----------

                         Union Membership Requirements
                         -----------------------------

        SECTION 1. It is agreed that, upon compliance with the requirements
of Section 8(a)(3)(i) of the Labor Management Relations Act, 1947, as amended,
or upon a change in 




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<PAGE>   5
              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


the law eliminating such requirements, good standing membership in the Union
shall be a condition of employment for all employees on and after the thirtieth
day following the beginning of such employment. For the purpose of this
provision, a member of the Union shall be deemed to be in good standing only if
his initiation fees and periodic fixed dues are not in arrears for more than
thirty (30) days.

     SECTION 2. Any employee of the Company who, at any time while this
Agreement is in effect, has been performing a class of work which is subject to
the Union membership requirements of this Agreement, but who is subsequently
transferred or promoted to a class of work which is not subject to the Union
membership requirements of this Agreement, shall have the privilege of
withdrawing from Union membership, and the Union agrees that such withdrawal
shall not prevent any such employee from renewing Union membership in the event
that thereafter the employee is assigned to a class of work in which Union
membership is required hereunder as a condition of employment. 

     SECTION 3. Any employee of the Company who is required hereunder to become
a member of the Union as a condition of employment and is not a member of the
Union in good standing, as above defined, shall on ten (10) days' written
request of the Union, be removed from the Company payroll at the end of the next
weekly pay period after expiration of such ten (10) day period, provided he has
not paid up such deficiency within that time.




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<PAGE>   6

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995

                                   ARTICLE IV
                                   ----------

                               Payroll Deductions
                               ------------------

            SECTION 1. The Company agrees to deduct from earned wages and remit
to the office of the Union at Suite 605, 815 16th Street, N.W., Washington, D.
C. 20006, dues in the amount of $7.311 (or such amount as may be voted by the
Local Union) weekly of those employees who are members of the Union, and not
exempt from provisions of this Agreement, and who individually authorize such
deduction in writing. The deduction shall be made on account of earned wages on
a weekly basis and shall be remitted to the office of the Union on a monthly
basis at the end of the fourth payroll week of each month.

 ------------------------------
      1.  As of January 14, 1995.

A copy of the approved form of authorization follows:-

To    FALL RIVER GAS COMPANY
      155 North Main Street
      Fall River, Massachusetts

      As my employer, you are authorized and directed to deduct from my earned
      wages during each payroll week hereafter, my Union dues in the amount of
      Seven Dollars and Thirty-one Cents ($7.31) (or such amount as may be voted
      by the Local Union) per week and remit the same to the office of UTILITY
      WORKERS UNION OF AMERICA, AFL-CIO, Suite 605, 815 16th Street, N.W.,
      Washington, D.C. 20006. This authorization and direction is valid during
      the term of the existing contract between Fall River Gas Company and
      Utility Workers Union of America, AFL-CIO, and any renewal or extension
      thereof, unless and until revoked by me in writing.

      Dated at Fall River, Massachusetts.

                                                                         199
                                                      -------------------   --
      As Witness:

                                    ----------------------------
                                          Employee's signature



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<PAGE>   7

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


                                    ARTICLE V
                                    ---------

                             Hours and Days of Work
                             ----------------------

            SECTION 1. Eight hours shall constitute the regular daily assignment
of all employees coming within the scope of this Agreement, except as
hereinafter set out.

            SECTION 2. Five days of eight hours shall constitute the regular
weekly assignment of all employees coming within the scope of this Agreement.

            SECTION 3. A. The regular working hours for the Service Department 
shall commence at 8:00 A.M. and end at 4:30 P.M., with one-half hour for lunch.

                       B. The regular working hours for the Street Department
shall commence at 7:00 A.M. and end at 3:30 P.M., with one-half hour for lunch.

            SECTION 4. Nothing in this Article contained shall be deemed or
construed as an Agreement or guaranty on the part of the Company that it will
furnish any amount of work to its Employees.

            SECTION 5. During the term of this Agreement, no employee with ten
(10) or more consecutive years of service with the Company shall be laid off for
lack of work; provided, however, that in case of such lack of work, the Company
shall assign him to such rating as the employee is capable of performing and at
the pay rate of that rating; and, provided further, that if such employee is
totally disabled or incapable of performing work for the Company in any rating,
his employment may be terminated; and provided still further that the Company's
right to discipline or discharge for just cause shall not be impaired by the
provisions of this paragraph.
                                   ARTICLE VI
                                   ----------

                        Days of Relief - Work Assignment
                        --------------------------------

            SECTION 1. Days of relief shall be established by the Company, but
may be changed when, in the discretion of the Company, its operations require
same. When new positions are created, days of relief shall also be established
with such positions, but may be changed thereafter when, in the discretion of
the Company, its operations require same. The usual work week shall be five (5)
days. The Company shall have the right to assign employees



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<PAGE>   8

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995

to a schedule of five consecutive days, including Saturday and Sunday, where
Saturday and Sunday fall within the work week. Employees working on a shift
shall be deemed to be working on the day in which the shift commences. Schedules
for employees concerned shall be posted in final form two (2) weeks before
effective date thereof, but may be changed in event of emergency.

            SECTION 2. Employees will not be compelled to change their days of
relief with other employees. No exchange of days off between employees shall be
effected without prior approval of the immediate supervisor.

            SECTION 3. The Company will train a man to be added to the C&F
schedule, in order to allow one full weekend off every fourth week. Any newly
hired employee will require six months' training before being put on a C&F
schedule.

            SECTION 4. The Company agrees to change the order of shift rotations
in the production department from nights, days, afternoons to nights,
afternoons, days.

            SECTION 5. The Company and the Union will establish a mutually
acceptable procedure for annual change and rotation of crew assignments in the
Production Department. In the absence of any agreement, the annual change of
crew assignment necessary to maintain operations, will be determined by lot
after taking into consideration the training and experience of each member of
the Production Department.

                                   ARTICLE VII
                                   -----------

                                      Wages
                                      -----

            SECTION 1. A. Wages shall be paid employees in each class of service
in accordance with the schedule showing the classification and the ultimate base
rate of each class as set forth in Exhibit "A", attached hereto and made a part
hereof. In all cases of promotion or permanent transfer, regular employees
having six months of continuous service with the Company, prior to the promotion
or permanent transfer, shall receive the ultimate rate for the class of work to
which they are assigned. An employee demoted to a lower-rated position shall
receive the applicable rate for such lower-rated position.



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<PAGE>   9


              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


                          B. If an employee with Twenty (20) Years or more
of service with the Company is unable to perform his regular duties, due to a
physical condition or impairment, the Company shall endeavor to assign him, for
the duration of his employment by the Company, to a rating which he is capable
of performing. If he is assigned to a lower rating, he shall retain the rate of
the classification from which he retrogressed.

                          C. If an employee is unable to perform his regular
duties due to a physical condition or physical impairment as defined by the DOT
Rules and Regs., as applied to his job, the Company shall endeavor to assign him
for the duration of his employment by the Company, to a rating which he is
capable of performing. If he is assigned to a lower rating, he shall retain the
rate of the classification from which he retrogressed.

            SECTION 2. Effective as of May 1, 1995, all employees then employed
by the Company shall receive an increase in wages of Three (3.0%) percent;
effective as of May 1, 1996, all employees then employed by the Company shall
receive an increase in wages of Three (3.0%) percent; effective as of May 1,
1997, all employees then employed by the Company shall receive an increase in
wages of Three and One-half (3.5%) percent; and effective as of May 1, 1998 all
employees then employed by the Company shall receive an increase in wages of
Three and One-half (3.5%) percent.

            SECTION 3. A. When Street Department employees are temporarily
assigned to function as a Shovel Operator or a Compressor Operator, either in
the absence of the regular Shovel Operator or Compressor Operator or on a direct
assignment to operate a spare Shovel or Compressor, they shall be paid at the
rate of the Shovel Operator or the Compressor Operator, as the case may be.
Operation of the Shovel or use of the Compressor tools by any employee in the
presence of the regular Shovel Operator or Compressor Operator, as the case may
be, shall not constitute an assignment as a Shovel Operator or Compressor
Operator.

                          B. If a Street Department employee is assigned
temporarily to observe the operations, on a construction job, of an independent 
contractor, hired by the Company, with the duty of seeing that the contractor 
complies with the Company's job





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<PAGE>   10
              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995
               

specifications, including among other things any or all of the following duties:
taking measurements, making reports to the Company and/or performing supervisory
duties; then he shall receive a premium of ten (10) percent per hour over his
regular base rate of pay (but not to exceed the Foreman's rate of pay - but in
no case less than a premium of $1.00 per hour) for the time so spent.

                          C.  If a Street Department employee is assigned
temporarily as a foreman of a crew of three (3) or more men (including himself),
then he shall receive a premium of ten (10) percent of his regular base rate of
pay (but not to exceed the Foreman's rate of pay - but in no case less than
$1.00 per hour premium) for the time so spent. If, a crew of two (2) or more men
which is normally supervised by a foreman in attendance, the foreman is not
present and one of the men is assigned temporarily as foreman, then such
employee shall receive a premium of ten (10) percent of his regular base rate of
pay (but not to exceed the Foreman's rate of pay but in no case less than $1.00
per hour premium) for the time so spent.

                          D.  If a Service Department Fitter is assigned
temporarily as a foreman of a crew of three (3) or more men (including himself),
he shall receive a premium of ten (10) percent of his regular base rate of pay
(but not to exceed his supervisor's rate of pay - but in no case less than $1.00
per hour premium) for the time so spent.

            SECTION 4. New employees hired during the term of this Agreement
shall receive a starting wage that shall not be less than eighty (80%) percent
of the ultimate base rate for the class of work to which they are assigned.
After six (6) months of service with the Company, new employees will receive the
ultimate base rate for the class of work to which they are assigned.

            SECTION 5. The classification and rates of pay contained in the
schedule attached hereto shall not be changed or amended during the life of this
Agreement without mutual agreement of the parties hereto signatory, except as
herein provided.

            SECTION 6. A. Employees shall receive normal compensation (called
holiday pay) for eight hours on each legal holiday listed in Section 6B below,
provided the employee works 






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<PAGE>   11


              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


the entire work day or such part thereof as work is available on both his
scheduled work day next prec eding and his scheduled work day next following the
holiday, unless justifiably absent on such work days, and provided further that
he has worked within thirty (30) days before such holiday.

                           B. When employees work on a holiday, they shall
receive their regular holiday pay and in addition, shall receive one and
one-half (1.5) times their regular rate of pay, except in the case of employees
working on Christmas and Thanksgiving, in which case such employees shall 
receive two (2.0) times the regular rate of pay, for the first eight (8) hours 
actually worked. "Holiday pay" is an amount equal to eight multiplied by the 
regular base hourly rate. Holidays shall be as follows:- New Year's Day,
Washington's Birthday, Patriots Day, Good Friday, Memorial Day, Independence 
Day, Labor Day, Columbus Day, Armistice Day, Thanksgiving Day, Christmas Day 
and Employee's own birthday.

                           C. If an employee works more than eight hours on a
holiday, he shall receive double time for such excess hours worked, but no
additional holiday pay.

                           D. An employee shall receive holiday pay even
though a holiday occurs during his scheduled vacation. The employee may elect to
receive equivalent time off in lieu of the holiday pay, subject to the Company's
approval.
                           E. An employee shall receive holiday pay even
though a holiday occurs on the employee's day off. The employee shall be
afforded the option of taking an alternative day off, subject to the prior
approval of the appropriate supervisor, so as not to interfere with the normal
operation of the Company, or accepting the holiday pay.

                           F. Each regular employee shall be entitled to two
"personal days" each year which "personal days" shall for all purposes hereunder
be deemed to be holidays, provided, however, the "personal days" will be taken
upon reasonable advance notice to employee's supervisor and the taking of such
"personal days" individually or collectively among one or more employees of the
unit shall not interfere with the day-to-day operations of the Company's
business.




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<PAGE>   12


              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


            SECTION 7. When employees are scheduled to work on Sunday, they
shall receive a premium of Twenty-five Per Cent (25%) of their regular rate of
pay for all hours worked on Sunday.

            SECTION 8.
      A. all employees subject to this Agreement shall be paid overtime at the
rate of one and one-half times their regular rate of pay for all hours worked
outside their regularly scheduled hours, provided, however that an employee not
on a posted work schedule for work on Sunday, if assigned work on Sunday, shall
be paid for such work at 2 times his regular rate of pay.

      B.  The above is not to conflict with holiday pay as outlined in Section 6

      C. The Company will post, monthly, the list of overtime hours worked by
the employees in the previous month, and will endeavor to distribute overtime
work as equally as possible among employees desiring and qualified to do such
overtime. Employees not desiring overtime shall notify the Company, and the
Company will endeavor, to the extent reasonably feasible, not to assign overtime
to such employees. If an insufficient number of employees is available for
overtime work, the most junior employees shall be required to do the work.

            SECTION 9. Whenever hours worked in excess or outside of the
regularly scheduled hours are the result of courtesy time, such excess hours
shall be paid for at straight time rates. Courtesy time is understood to mean an
arrangement permitted at the discretion of the Company whereby two employees on
consecutive shift jobs agree to exchange shift schedules or parts thereof for
the convenience of the employees. There shall be no exchange of courtesy time
between employees when such exchange will result in overtime or shift
differential payments to a fellow employee, and no meal shall be furnished by
the Company because of courtesy time worked.

            SECTION 10.  The following schedule shall apply to employees who are
on "stand-by":-

                          A.  Employees on stand-by call week-day nights shall
receive Nineteen and 00/100 ($19.00) Dollars for each night, plus compensation 
at time and one-half 




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<PAGE>   13




              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


for actual time worked.

                          B. Employees on stand-by call Saturdays and sundays,
including Saturday and Sunday nights, shall receive Twenty-seven and 50/100
($27.50) Dollars for each Saturday and Sunday, plus compensation at time and
one-half for actual time worked.

                          C. Employees on stand-by call on holidays shall
receive Twenty-seven and 50/100 ($27.50) Dollars for such holiday, plus
compensation at time and one-half for actual time worked.

                          D. The following shall apply to the "Stand-by"
Position in the Street Department:

                               a. There shall be four (4) persons assigned to
the "Stand-by" positions and three (3) persons assigned to the "Spare Stand-by"
positions.

                               b. If there is an abundance of persons desiring
to be assigned to the "Stand-by" positions or to the "Spare Stand-by" 
positions; the positions shall be awarded on the basis of Seniority. The most
senior persons will have the right to be assigned to either the "Stand-by" or
"Spare Stand-by" positions, depending on their desires and assuming they are
qualified.

                               c. When an employee progresses to the
classification of B Street Person, he shall be considered qualified to be
assigned to either the "Stand-by" or "Spare Stand-by" position.

                               d. If an employee in the Street Department is
not in the normal progression plan (usually leading to Utility Street Person),
i.e., Shovel Operator, Welder, etc..., said employee shall be considered
qualified to be assigned to either the "Stand-by" or the "Spare Stand-by"
position, when both the Union and the Company mutually agree that said employee
is qualified to perform the duties of those positions (neither party shall
unreasonably withhold its acquiescence).

                               e. The employees assigned to the "Spare 
Stand-by" positions shall be utilized on a rotating basis, by incident, with no
incident lasting longer than 




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              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


seven (7) consecutive days.

                          E.  The provisions of this Section shall not be
deemed to prevent the Company from discontinuing stand-by arrangements at any
time, at the Company's sole discretion.

            SECTION 11. An employee called in by a responsible authority of the
Company outside his scheduled hours, and after he has already left the Company
premises, shall receive overtime as determined under Section 8 above, for all
hours worked, and in addition shall receive an allowance for idle time at
straight time for the difference between four (4) hours and the number of hours
actually worked in the aggregate, if less than four; provided, however, that
this allowance shall not be paid in any case where employees are assigned to
work continuous overtime from the end of their regular day, nor when employees
are requested to report for work before their regular reporting time, (in which
cases such employees shall receive overtime only for time worked up to their
regular reporting time), nor where an employee is on "standby".

            SECTION 12. "Night Work" premium shall be paid to all employees,
including auto mechanics, as follows:-

                        A. A premium of One Dollar ($1.00) per hour will be
paid for all hours worked by an employee who is on a posted schedule
regularly starting at or after twelve o'clock noon and to and including four
o'clock p.m.
                        B. A premium of One Dollar and Twenty-five cents
($1.25) per hour will be paid for all hours worked by an employee who is on a
posted schedule regularly starting after four o'clock p.m. and before six
o'clock a.m. This premium will also be paid for work on Sunday "A" or "B" shift
starting at 8:00 a.m.

            SECTION 13. Such premium or shift differential pay shall not apply
to time allowed for sickness, accident, vacation, holidays, or leaves of
absence.

            SECTION 14. The above-described premiums, if payable, shall on
overtime hours be multiplied by one and one-half, except as otherwise provided
in Section 6 B of this Article.

                                  ARTICLE VIII
                                  ------------


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<PAGE>   15


              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



                                    Seniority
                                    ---------

            SECTION 1. A. The present seniority rank of all present bargaining
unit employees of the Company shall be indicated on the seniority charts
prepared by the Company and shown as Exhibits "B" & "C", attached hereto and
made a part hereof.

                       B.  Additions to, and changes in, the seniority charts 
shall be made in accordance with the following rule: - Seniority shall begin 
when an employee is first hired by the Company, except, that where an employee 
has been dismissed or has voluntarily left the employ of the Company and has 
later been rehired, seniority shall begin when such employee was last hired.

                       C.  Seniority shall exist in two forms: Company
Seniority and Departmental Seniority.

                       D.  Departmental Seniority is listed according to the
hiring dates of all employees working within a particular department of the
Company. A Departmental Seniority list establishes the order by which the
employees listed thereon will be considered, as provided for in this Agreement,
for layoffs, vacation assignments, rehiring, promotions, and permanent transfers
within a department covered by this Agreement.

                       E.  Company Seniority is listed according to the hiring 
dates of all employees within the bargaining unit. The Company Seniority list 
establishes the order by which employees in the bargaining unit will be
considered, as provided for in this Agreement, for promotions and permanent
transfers between departments of the Company and for rehiring to positions not
located in the departments from which the layoffs occurred.

                       F.  An employee transferred to a supervisory position
with the Company and later returned to a position within the bargaining unit,
shall not continue to accumulate his seniority while employed in the 
supervisory position.

            SECTION 2. In the promotion of, and filling of vacancies by,
employees covered by this Agreement within and between departments of the
bargaining unit, the appropriate seniority will govern, subject to
qualifications of fitness and ability. If the 




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              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995




selection of the applicant for the promotions, filling of vacancies, or newly
created jobs, is other than the senior applicant, the question of fitness and
ability may be subject to the grievance procedure and Arbitration under this
Agreement, if the Union claims the Company has exercised its rights for unjust
reasons.

       SECTION 3. A. When forces are increased in any division, furloughed
employees shall be given preference over applicants not previously employed by
the Company, if they are qualified by fitness and ability to perform the work in
the division of service affected.

                          B. Furloughed employees, if offered work in writing 
by registered or certified mail by the Company for which they are qualified, 
must accept it in writing and report for work within seven (7) days after the 
offer is made; and furloughed employees, failing to accept work so offered and 
to return to work as aforesaid, shall be considered terminated.

                          C. A furloughed employee who is not reemployed within 
one year from the date on which his furlough begins shall be deemed terminated;
provided, however, that if such employee, within the twelfth month from the 
date on which his furlough begins, notifies the Company, in writing, that he 
desires to be considered as still on furlough for a second year, he shall not 
be deemed terminated unless he is not reemployed within two (2) years from the 
date on which his furlough begins; still further provided that, if such
employee, within the twelfth month from the date on which his second year's
furlough begins, notifies the Company, in writing, that he desires to be
considered as still on furlough for a third year, he shall not be deemed
terminated unless he is not reemployed within three (3) years from the date on
which his furlough begins.

                          D. Furloughed employees shall, during the period of 
their furlough, have no rights of an employee under the terms of this 
Agreement, other than the rights granted them in this Section. A furloughed
employee, recalled to work prior to the expiration of his recall period shall
retain his original Seniority date provided that he has 




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<PAGE>   17



              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


complied with the provisions of the Contract governing said recall period. The
employee's longevity rights accumulated prior to his being furloughed shall be
added to his time worked after his return to work following said furlough,
provided that he is recalled prior to the expiration of his recall period and
has complied with the provisions of the Contract governing said recall period.
The provisions of this clause shall be retroactive.

            SECTION 4. A. Subject to the limitations of applicable laws
prevailing when the question arises, any employee who, subsequent to the
enactment of the Selective Service Act of 1948, as amended, left the employ of
the Company for immediate entry into any of the Armed Forces of the United
States of America, will retain the same seniority ratings that he would have had
if he had remained in the employ of the Company during the period of absence,
provided that his military service is terminated by an honorable discharge and
that within ninety (90) days thereafter he shall apply in writing to the Company
for reemployment.

                       B.  The Company shall assign such an employee to the 
rating held by him at the time of such entry, provided he is then qualified by 
fitness and ability to perform the work in such rating, but if he is mentally
or physically unfit to perform the work in such rating, the Company shall
endeavor to provide him with employment in any rating in the Company for which
the Company deems him to be mentally, physically and otherwise qualified, and
provided also, that his Company seniority, including aforesaid military service,
shall be greater than that of the employee to be displaced.

            SECTION 5. The Company shall determine when a job opening is
available, except where automatic progression applies. Where any such opening
has been so determined by the Company to exist, such opening shall be posted and
shall be filled by the senior employee qualified by fitness and ability to
perform the work, in the order of priority set forth below. The change of an
employee from one classification to another classification shall not be deemed
as creating a job opening in the classification vacated.

                       A. From within the classification of the Department 
where the




                                       17


<PAGE>   18

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995

                            vacancy exists.

                          B. From within the Department where the vacancy exists
                          C. From senior employees within the Company.
                          D. From furloughed employees.
                          E. From applicants not previously employed by the
      Company.

            SECTION 6.  Progression Plan.
            ----------  -----------------

                          A. The Company retains all rights to promotion as
set forth in this Agreement.

                          B. In addition to the above, in the Service
Department, records will be kept of all service calls made by Servicemen and
Helpers. A continuing record will be kept of all calls, including those which
the employee cannot satisfactorily complete without assistance, or which require
a repeat call or calls. The type of service call that such men cannot complete
satisfactorily will also be catalogued.

                          C.  The Company will review, in December of 1979,
and each six months thereafter, the record of each employee, to determine
whether, in its opinion, any employee merits a promotion.

                          D.  Employees, if qualified to do the work of the
next higher rated job within the job classifications as set out on Exhibit D
attached hereto, shall move into the next higher rated job in accordance with
the automatic time progression set out on Exhibit D. The Company shall have the
right to accelerate such promotions if the Company determines that an employee
is qualified. If an employee feels that he should move up into a higher rated
job at an earlier date than set out on Exhibit D, he shall be entitled to a
personal conference in June and/or December in any year, with the presence of
the Steward, if the employee so requests, at which his qualifications will be
reviewed as to promotion. If his qualifications are defective, they will be
specified, and a program of education will be 


                                       18

<PAGE>   19



              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


outlined by the Company so that the employee shall have an opportunity to take
corrective action to improve his qualifications.

                          E.  The foregoing shall not prevent the Company
from advancing qualified men over more senior men who are not qualified.

                          F.  Any action of the Company in respect to the
above will not be subject to the grievance procedure unless the Union claims the
Company has exercised its rights for unjust reasons.







                                       19




<PAGE>   20

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995




                                   ARTICLE IX
                                   ----------

                                Leaves of Absence
                                -----------------

            SECTION 1. Allowance for sickness and non-occupational accidents
shall be accumulated on and after this date by regular employees covered by this
Agreement in the following manner:-

            A.    Regular employees who already have an accumulated allowance of
                  Two Hundred five (205) days or more shall be credited with no
                  further allowance until their accumulation falls below Two
                  Hundred Five (205) days.

            B.    Except as set out in A above, regular employees shall be
                  credited with fifteen (15) days' allowance for each full year
                  of continuous service rendered hereafter, up to a maximum of
                  Two Hundred Five (205) days.

            C.    The Company shall, at the end of each contract year, advise
                  each employee, in writing, of the amount of his accumulated
                  allowance.

            D.    Regular employees who have already accumulated an
                  allowance of Two Hundred Five (205) days and who at
                  the end of any contract year have unused sick days
                  which such employee would have accumulated during
                  that contract year, in excess of Two Hundred Five
                  (205) days, shall be paid an amount equal to
                  one-third (1/3) of the unused days in excess of two
                  hundred five (205) days based upon such employees
                  straight time wage rate for the contract year in
                  question.


            SECTION 2. Time off due to sickness and non-occupational accidents
shall be paid only for regularly scheduled work days or portions thereof lost
for those reasons, computed at the normal base hourly rate, and shall be
deducted from the accumulated allowance. Such payments shall be made only to the
extent of the incapacity or of the amount remaining in the accumulated
allowance, whichever is less, subject to the following provisions:-

            A.    All illness or non-occupational accidents must be bona fide
                  and reported 




                                      20
<PAGE>   21

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



                  promptly to the Company.

            B.    The Company, upon such notice, may have its doctor examine
                  the employee for the purpose only of determining whether or
                  not the employee is disabled or not, and the doctor shall
                  then issue his certificate to the Company as to whether or
                  not the employee is so disabled.  In the event that such
                  disability continues for more than one (1) day, the Company
                  doctor may make such additional examinations as he may, in
                  his discretion, deem necessary in order to determine the
                  length of time during which the employee is disabled.  The
                  Company doctor's certificate as to disability or not, and
                  as to length of time of disability, shall be final and
                  binding on the parties.

            C.    The Company shall pay the doctor only for examinations made
                  pursuant to issuance of the aforesaid certificates. Should any
                  employee engage the Company doctor for purpose of treatment,
                  the employee, and not the Company, shall pay the doctor for
                  services rendered in such treatment.

            D.    If certified as disabled by the Company doctor, or if the
                  Company elects to waive examination by its doctor after the
                  aforesaid notice, then such absence shall be paid for at full
                  time.

            E.    If certified as not disabled by the Company doctor, then
                  such absence shall not be paid for.

            F.    Absence due to injury or illness resulting from personal
                  violation of law, personal misconduct, or use of intoxicating 
                  beverages  by the  employee  shall not be paid for.
                 
            G.    It is understood that allowances for leaves of absence are
                  based on the assumption that the Company is the sole employer.
                  The allowance will not be granted for absence arising from
                  work for another employer or while self-employed.

                  H. If an employee claims such allowances without just cause,
                  he shall suffer the loss of benefits for that particular case.
                  If repeated, the employee shall be disciplined or discharged,
                  as the Company may direct, subject to the provisions of
                  Article XII.

            I.    Employees shall endeavor to schedule doctor's appointments
                  during non-


                                       21



<PAGE>   22

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



                  working hours when possible, provided that if a doctor's 
                  appointment must be scheduled during working hours, then such 
                  employee shall submit to a supervisor, upon his return to
                  work, a written notice stating the day, time and place of 
                  said appointment.

            J.    The Company may, at its sole discretion, extend the benefits
                  provided for under this section.

            K.    Any employee reporting as "sick" must, beginning with the
                  fifth (5th) incident of such absence for sickness in each
                  contract year, provide the Company with a doctor's
                  certificate, specifying the reasons for the sickness and
                  stating that the employee is able to return to work.

            SECTION 3. A regular employee shall be granted leave of absence in
the case of death in his immediate family as hereinafter defined, subject to the
following provisions:-

            A.    The employee must immediately notify his supervisor and
                  request the leave.

            B.    Not more than three (3) days up to and including the day of
                  the funeral shall be allowed due to the death of a member
                  of the immediate family, i.e., wife, husband, father, mother,
                  brother, sister, son, daughter, father-in-law, mother-in-law,
                  grandparent, or grandchild.  One (1) day shall be allowed to
                  attend the funeral of an aunt, uncle, brother-in-law,  
                  sister-in-law, son-in-law, daughter-in-law or spouse's 
                  grandparents.

            C.    During such leave of absence, the employee will be paid only
                  for regularly scheduled work days or portions thereof lost,
                  computed at his normal base hourly rate.

            SECTION 4. A regular employee called for jury duty shall be paid by
the Company, during such period of service, the difference between his normal
straight time wages and the amount received by him for his services as a juror.

            SECTION 5. A. For all time lost due to occupational accidents, for
which payment is being made through Workmen's Compensation Insurance, the
Company will pay the difference between the normal straight time wages of the
employee and the amount received by him and/or his dependents from Workmen's
Compensation Insurance, in the following manner



                                      22
<PAGE>   23

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995




and to the following extent:-

                          B. During any consecutive twelve months' period,
regular employees subject to this provision shall receive payments as set forth
above, for a period of one week for each consecutive year of service with the
Company hereafter, up to a maximum of thirty weeks.

                          C. The first week of absence due to the disability
shall not be counted in determining the number of weekly payments to which
the employee may be entitled under this section.  Such payments shall be
subject to the following provisions:-

                  1)    All occupational accidents must be bona fide and
                        reported promptly to the Company.

                  2)    Incapacity must be determined to be compensable under
                        the Workmen's Compensation Act of the Commonwealth of
                        Massachusetts before being paid for.

                  3)    No payments shall be made where occupational accidents
                        result from personal violation of Company rules or law
                        or personal misconduct of the employee, or use of
                        intoxicating beverages by the employee.

              D. In the event a regular employee is injured on the job, and such
injury is determined to be compensable under the Workmen's Compensation Act of
the Commonwealth of Massachusetts, then, during the period such employee is
recovering from such injury, such injured employee shall retain his employment
status with the Company for the following period: (a) for regular employees with
more than six (6) months but less than five (5) years of service on the date of
injury - a period of one (1) year from the date of injury; and (b) regular
employees with five (5) or more years of service on the date of injury - a
period of two (2) years from the date of injury. If such employee has not
recovered and can not return to work at the end of the period, such employee may
be terminated because of failure to report.

            SECTION 6. A. No employee representative of the Union may be absent
from his work with pay for the transaction of Union business, except for the
purpose of handling 


                                      23
<PAGE>   24


              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


grievances at the request of the Company. Before leaving his job, he must
request of, and receive permission from, his foreman to do so. Such permission
shall not be withheld by the foreman, except for reasonable cause.

                          B. After each such absence, the representative of the
Union shall report to the foreman in charge when he returns to work.

            SECTION 7. Any employee may be permitted,  by the  Superintendent
of the Company or his designated representative, to leave the job for no more
than the remainder of the day, or to remain away from work for no more than that
day because of an emergency existing at home, and he may, at the sole discretion
of the Company, suffer no loss of pay therefor.

            SECTION 8. Leaves of absence for any reason not provided for in this
Article may be granted upon the sole discretion of the Company, and, in such
cases, the Company may grant such leaves of absence on condition that the
employee shall, during such leaves, have no rights of an employee under the
terms of this Agreement; provided, however, that no employee shall be
disciplined or discharged, except for just cause, and provided, further, that he
shall maintain his seniority.

                                    ARTICLE X
                                    ---------
                                    Vacations
                                    ---------

            SECTION 1. Regular employees hereafter hired and continuously
employed by the Company for a period of less than six (6) months, as of May 1 of
the current calendar year, shall receive one day's vacation for each full month
worked with pay equal to one-sixth (1/6) of a week's wages for each full month
worked.

            SECTION 2. Regular employees continuously employed by the Company
for a period of at least six (6) months but less than a year as of May 1 of the
current calendar year, and who have done actual work for at least six (6) months
during the twelve (12) months preceding May 1 of the current calendar year,
shall receive one week's vacation with pay.

            SECTION 3. Regular employees continuously employed by the Company
for a 




                                       24


<PAGE>   25

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995

period of at least one (1) year but less than five (5) years as of May 1 of the
current calendar year, and who have done actual work for at least six (6) months
during the twelve (12) months preceding May 1 of the current calendar year,
shall receive two weeks' vacation with pay.

            SECTION 4. Regular employees continuously employed by the Company
for a period of five (5) years or more, but less than ten (10) years as of May 1
of the current calendar year, and who have done actual work for at least six (6)
months during the twelve (12) months preceding May 1 of the current calendar
year, shall receive three weeks' vacation with pay. The Company will endeavor to
schedule the three (3) weeks consecutively, but reserves the right to schedule
the third week during any part of the year, or to eliminate the third week, if
circumstances do not permit scheduling the third week during the current year.
The Company agrees to pay the employee the third week's wages even though the
time-off for the third week is eliminated.

            SECTION 5. Regular employees continuously employed by the Company
for a period of ten (10) years or more but less than Twenty (20) years as of May
1 of the current calendar year, and who have done actual work for at least six
(6) months during the twelve (12) months preceding May 1 of the current calendar
year, shall receive four (4) weeks' vacation with pay. The Company will endeavor
to schedule the four (4) weeks consecutively, but reserves the right to schedule
the third and fourth weeks during any part of the year, or to eliminate the
third and fourth weeks, if circumstances do not permit scheduling the third and
fourth weeks during the current year. The Company agrees to pay the employee the
third and fourth weeks' wages even though the time-off for the third and fourth
weeks is eliminated.

            SECTION 6. Regular employees continuously employed by the Company
for a period of twenty (20) years or more as of May 1 of the current calendar
year, and who have done actual work for at least six (6) months during the
twelve (12) months preceding May 1 of the current calendar year, shall receive
five (5) weeks vacation with pay. The Company will endeavor to schedule the five
(5) weeks consecutively, but reserves the right to schedule the third, fourth,
and fifth weeks during any part of the year, or to eliminate the third, fourth
and 




                                       25


<PAGE>   26


              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995




fifth weeks, if circumstances do not permit scheduling the third, fourth, and
fifth weeks during the current year. The Company agrees to pay the employee
the third, fourth, and fifth weeks' wages even though the time-off for the
third, fourth, and fifth weeks is eliminated.

            SECTION 7. Should an employee be called back to work by the Company
after going on his assigned vacation period, the Company shall arrange for his
vacation time to be completed later in the year. The employee shall receive his
full vacation pay for his originally assigned vacation period only, and in
addition thereto, he shall be paid time and one-half for the newly scheduled
hours actually worked by him during his originally assigned vacation period.

            SECTION 8. A. Vacations will, so far as possible, be granted at the
time desired by employees. The Company will allot time of vacation in such
manner as to assure the orderly operation of the Company. Within the limitations
set forth above, preference for selection of vacation periods by the employees
in each classification shall be given according to the order of their listing on
the seniority roster. Vacations shall be taken on a week-to-week basis, except
upon prior approval by the Company, employees may apply for and be granted
vacations on a one (1) day basis, further provided that under no circumstances
will employees be granted vacations of less than one (1) full day.

                          B. Vacations must be taken annually between May first
and April 30th within the current contract year, except in cases of emergencies
or other unusual circumstances, upon request to, and at the sole discretion of, 
the Company.

                          C. In special circumstances, special leave or time
off, up to three (3) days, with pay, may be granted by the Company, at any time
during the year, as a loan or advance against the vacation next following.

                                   ARTICLE XI
                                   ----------

                        Miscellaneous Working Conditions
                        --------------------------------

            SECTION 1. The hours of work shall be continuous. Except in cases of
emergency, time shall be taken off for lunch, which will not be paid for or
counted in the working hours. Such lunch period will start at twelve o'clock
noon and shall not be changed except for good 


                                       26


<PAGE>   27


              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



reason.

            SECTION 2. A. In positions where the nature of the work requires
continuous operation, eight (8) consecutive hours may be worked, during which
lunch may be eaten without interruption to service, or deduction in pay,
providing safe operation is maintained at all times.

                          B. No employee will be required to work in excess
of sixteen (16) hours of continuous work without an eight (8) hour rest period
before having to report for work again. He shall receive pay at his regular base
rate for those hours of his regularly scheduled work day that fall within such
eight (8) hour rest period. When an employee works for sixteen hours or more in
any twenty-four hour period, he shall be entitled to a rest period of eight
hours, after the completion of the sixteenth hour worked. Should the Company
request the employee to work during the eight hour rest period, he shall be paid
at the rate of 150% of his regular straight time wage for such hours worked, if
employee is already entitled to be compensated at 150% of straight time wage for
such hours worked, compensation shall be at 200% of straight time wage for such
hours worked and if employee is already entitled to be compensated at 200% of
straight time wage for such hours worked, compensation shall be at 250% of
straight time wage for such hours worked, provided, however it is the
responsibility of such employee to notify the appropriate supervisor,
supervisors or dispatcher sufficiently in advance of the end of the sixteen (16)
hour work period to permit the Company to reschedule the employee's work day.
The employee shall continue to be paid at this overtime rate for such hours
worked until he has had an eight hour rest period. The eight hours of rest shall
be consecutive.

                          C. If an employee is required to work overtime for
more than two (2) hours during the eight (8) hour period immediately preceding
the starting time of his next scheduled daytime shift (starting between six and
eight a.m.) he shall, whenever possible, be allowed rest time, at the start of
that scheduled shift, equivalent to the amount of time worked during the
preceding eight hour period. The employee shall be compensated for said rest
time at his normal straight time wage, unless other provisions of this Agreement
are applicable.


                                       27

<PAGE>   28

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


                                Whenever said rest period is not possible, the
employee shall be paid at the rate of 150% of his regular straight time wage
for such hours worked, if the employee is already entitled to be compensated at
150% of straight time wage for such hours worked, compensation shall be at 200%
of straight time wage for such hours worked and if employee is already entitled
to be compensated at 200% of straight time wage for such hours worked,
compensation shall be at 250% of straight time wage for such hours worked.
(Nothing in this section is to conflict with the provisions of Section B of this
Article).

            SECTION 3. A. The Company agrees that a foreman, supervisor or
executive in charge, other than to demonstrate how he desires the work to be
done, shall not perform any work covered by employees which can be performed by
the employees under his supervision on the particular job, except for a Working
Street Foreman with a crew of four men or less, and except in cases of
emergency, or in the need of specialized skill.

                       B.  The Company further agrees that, except in cases of 
emergency, student engineers shall not perform any work ordinarily performed by 
employees in the bargaining unit, where such work simultaneously displaces 
employees then working in the bargaining unit.

            SECTION 4. A.  The Company will, where it considers it necessary,
supply the necessary protective clothing for exposure occurring outside the 
ordinary activities of an employee's employment.

                       B.  The Company will furnish work gloves to employees
whose work the Company deems requires this type of protection. A new pair may be
obtained after a reasonable period of time by turning in the old pair.      

                       C. The Company will pay Fifty Dollars ($50.00) toward 
the cost of safety shoes and if the employee irreparably damages his safety 
shoes, while performing work for the Company, the Company will pay the full 
cost of replacing said shoes with an equivalent pair of shoes.

            SECTION 5. The Company shall maintain, in the Distribution and
Production 



                                       28


<PAGE>   29
              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



Department Buildings, an adequate stock of coveralls for use by the employees 
when they are required to work in any place where clothing may be damaged or
soiled.

            SECTION 6. The Company will supply the necessary equipment and tools
for carrying out any assigned work.

            SECTION 7. A ten minute wash-up period before the noon meal shall be
granted daily to employees of the Meter Shop and Garage. A ten minute wash-up
period at the end of, and within, the scheduled day's work, shall be granted
daily to all employees of the Distribution Department and a ten minute change-up
period, in addition to the ten minute wash-up period, shall be granted to all
employees required to wear Company uniforms, said change-up period shall only be
granted to those employees desiring to change out of said uniforms. A
twenty-minute wash-up period at the end of, and within, the day's work shall be
granted daily to employees of the Production Department, except those engaged in
continuous operation.

            SECTION 8. Each employee shall keep the Company informed in regard
to his address and telephone number.

            SECTION 9. A. Employees, including those on stand-by, called in for
overtime work not previously scheduled shall not be required to work in excess
of four hours, unless furnished with a meal, at a cost of Six Dollars ($6.00) to
be paid for by the Company.

                       B. An employee including one on stand-by, required to
work two hours overtime immediately following the expiration of his regularly
scheduled work day shall be furnished with a meal upon completion of the two
hours overtime worked. An additional meal for each additional five hours of
continuous work will be provided. The expense of these meals will be Six Dollars
($6.00) and paid for by the Company.

            SECTION 10. The dispatcher shall have the sole authority and
responsibility to assign servicemen to read meters. When servicemen are assigned
to read meters and there are scatter meter readings also being done, the meter
readers shall read books and the servicemen shall do the scatter readings. When
servicemen are assigned to read meters, the most junior men available excluding
employees who have not completed their six (6) months trial period in the



                                       29



<PAGE>   30




              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



service department, will be assigned to such work.

            SECTION 11. If service work on roof-top equipment requires the
service of more then one man, the Company shall assign a second man to the job.

            SECTION 12. The Company agrees to arrange for the printing and will
deliver to the Union without cost, one hundred fifty (150) pocket-sized copies,
approximately four inches by six inches, of this Collective Bargaining
Agreement. The Company reserves the right to cause the Agreement to be printed
or prepared by use of computer printing system in order to limit costs and
expenses, or alternatively, to have the Contract printed at a printing house. If
the Contract is printed at a printing house, the Company agrees to have it
printed by a Union printer and to have the Union logo or "bug" printed on the
cover of the Contract book.

            SECTION 13. UNIFORMS. Beginning May 1, 1990 or as soon thereafter as
may be reasonably accomplished, the Company will provide uniforms to employees
regularly assigned as meter readers, Customer Service Department and Street
Department personnel. The Company will provide the uniforms on a rental basis,
for a total of eleven (11) sets of uniforms to each employee. It is expected
that each uniform will be changed daily, and accordingly, the Company will
arrange to have five (5) sets of the uniforms picked up each week and exchanged
for freshly cleaned uniforms. Through a uniform rental company, the Company will
arrange for the rental of eleven (11) long-sleeved shirts, eleven (11)
short-sleeved shirts, eleven (11) pants, two (2) light-weight jackets, one (1)
winter weight jacket, a baseball type cap for summer use and a "watch" type cap
for winter use. The colors of the garments will be light blue shirts and navy
blue pants and jackets. The Company's logo is to be set forth on each shirt and
jacket in a size and style which will look appropriate, located over the breast
pocket of the uniform. The employee's name shall not be placed on the outside of
the uniform.

            Each employee is required to take reasonable care of the uniforms
and to deliver the soiled uniforms weekly to a designated location in the
Company for exchange. It is expected that each employee assigned to the Meter
Reading Department, Service Department and Street Department will wear the
uniforms. The Company reserves the right to discontinue requiring 




                                       30




<PAGE>   31




              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



the use of and the furnishing of uniforms to employees at any time without any
adjustment in the compensation or benefits paid to employees affected.

                                   ARTICLE XII
                                   -----------
                             Suspensions and Discharges
                             --------------------------

            SECTION 1. No employee shall be discharged, suspended, or
disciplined without good and sufficient cause. In case of any dispute regarding
such discharge, suspension or discipline, if the Company and the Union Grievance
Committee cannot reach agreement within five (5) days, the matter shall be
disposed of by reference within forty-five (45) days thereafter to the
Arbitration Board hereinafter set out, and such dispute shall be heard by the
Arbitration Board forthwith and prior to any other dispute. If the matter is not
referred to the Arbitration Board within said period of forty-five (45) days,
then the discharge, suspension, or discipline shall be final and not the subject
of Arbitration. If the discharge, suspension, or discipline is found to be
unjustified, the Arbitration Board shall have the right, in its discretion, to
direct that the employee shall lose no seniority and shall be compensated for
the loss of his earnings during the period thereof. However, if the discharge,
suspension, or discipline, of an employee is not submitted as a grievance by the
Union, in writing, to the Company within five (5) days after such discharge,
suspension, or discipline, then such discharge, suspension, or discipline shall
be final and not the subject of the grievance procedure.

            SECTION 2. A. If an employee loses his license to operate a motor
vehicle, under circumstances where he is not subject to termination or
suspension for breach of Company rules, violation of law, or other improper act
or failure to act, then the Company shall use its best efforts to give him work,
within his classification, without reduction in pay, if economically feasible.
If this is economically unfeasible, then the Company shall use its best efforts
to give him any available work which he is competent to perform, in which case
the employee shall receive wages at the rate of the classification in which he
is performing work.

                       B. Employees must at all times hold a valid and
appropriate operator's license as required by state or federal authority to
operate Company vehicles.




                                       31



<PAGE>   32




              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


                        C. An employee shall immediately notify the Company
if his ability to operate a motor vehicle has been restricted in any way. The
failure of an employee to notify the Company of such restriction, revocation or
suspension of operator's license or the operation of a Company vehicle without
an appropriate license shall be reason for discipline of such employee,
including suspension.





                                       32
<PAGE>   33

                                  ARTICLE XIII
                                  ------------

                  Disputes and Grievances, Arbitration
                  ------------------------------------

            SECTION 1. The Company and the Union agree that a grievance is
defined as an alleged violation or misapplication of the terms of this Agreement
with respect to rates of pay, wages, seniority, hours of employment or other
conditions of employment, and every reasonable endeavor shall be made to settle
such grievance by agreement between the Union and the responsible officers of
the Company.

            SECTION 2. All grievances, except those covered by Article XII,
shall be handled in the following manner.

                          A. The employee or employees and/or his Steward shall
discuss the grievance with his immediate supervisor.

                          B. If the grievance has not been settled within
five (5) days of the meeting in Step A, it may be reduced to writing and sent to
the Director of Employee Relations with a request for a meeting with him.
Present for the Local will be the President and the Steward involved.

                          C. If the grievance is not settled within five (5)
days of the request for the meeting in Step B, the Local may request in writing
a meeting with the President of the Company. Present for the Union will be the
Executive Board of the Local and the National Representative.

                          D. Such conference shall be held outside of
working hours, except at the request of the Company. However, the Company will
give permission for an accredited representative of the Union to visit work
locations in connection with grievances arising out of this Agreement, whenever
such permission in the judgment of the supervisor, may be given without serious
interference with the proper performance of the duties of the employees.

                          E. Employees acting as representatives of the Union
may discuss grievances with the Company during their working hours if at
the request of the Company, 




                                       33
<PAGE>   34

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



without loss of pay, upon previous and suitable notice to the supervisors
involved; but no employee, not scheduled to work during the hours of discussion
of grievances, shall be paid by the Company for time devoted to such
discussions, and no employee shall be paid by the Company for any time lost
while acting on behalf of the Union during Arbitration proceedings.

                          F. In the event that the Company believes itself
aggrieved because of any matter in connection with this Agreement, or because of
failure of members of the Union to comply with the terms of this Agreement, it
is understood and agreed that the Company may, in its turn, avail itself of the
grievance and Arbitration procedure herein established.

                          G. In the event a grievance shall not have been
satisfactorily settled by the foregoing processes, the matter shall be referred 
to Arbitration under the following procedure:-

                        (i)   Either party may notify the other in writing by
                              registered or certified mail of its desire to
                              arbitrate, setting forth the matter in dispute and
                              enclosing therewith a copy of the written
                              grievance.

                        (ii)  If the parties do not agree upon an Arbitrator
                              within ten (10) days, the American Arbitration
                              Association shall upon written application of
                              either party appoint one (1) Arbitrator pursuant
                              to the AAA Rules applicable to Voluntary Labor   
                              Arbitration to conduct an Arbitration hearing on 
                              the matter which is the subject of the grievance.

                          H. Any Arbitration established hereunder shall
commence promptly and meet as often as may be necessary for the purpose of
adjusting the grievance submitted to it, the decision of the Arbitrator shall be
in writing, signed and dated by the Arbitrator, one copy shall be delivered to
each of the parties, and such decision shall be binding upon both parties for
the duration of this Agreement.




                                       34
<PAGE>   35

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


                          I.   Any Arbitration established hereunder shall 
have jurisdiction and authority only to resolve the questions specifically
submitted to it, which shall be limited to interpretation of this Agreement and
the application of this Agreement to the matters in dispute which may be
presented to it through the grievance procedure. The Arbitrator may make such
retroactive award or settlement as the equities of the case may demand, but in
no event shall any award or settlement be retroactive beyond the date on which
the grievance was first presented. The Arbitrator shall have no power to alter,
revise, add to, abolish, strike from, or modify in whole or in part any of the
terms of this Agreement.

                          J.  The Company and the Union shall bear the expense 
of its own witnesses, and its own representative at the Arbitration. The
expenses of the Arbitrator, the expenses of the American Arbitration Association
and all other expenses, shall be borne equally by the Company and the Union.

                                   ARTICLE XIV
                                   -----------
                              No Strike-No Lockout
                              --------------------

            SECTION 1. It is agreed by and between the parties hereto signatory
that, while this Agreement is in force, there shall be no lockouts of the
employees by the Company, and neither the Union, nor its officers, agents, or
members, will authorize, sanction, cause or participate, directly or indirectly,
in any concerted failure to report to work, slowdown, interruption of work, or
in any strike or cessation of work, for any cause whatsoever.

            SECTION 2. In the event of any unauthorized strike or work stoppage
on the part of the employees during the life of this Agreement, the Union and
the Company will publicly disavow the strike or work stoppage and the Union will
cooperate with the Company in getting the employees to return to, and remain at,
work.

            SECTION 3. The Union agrees that the Company has the right to take
disciplinary action, including discharge, against any employees who engage in
any unauthorized strike or concerted failure to report to work, slowdown,
interruption or stoppage of work, provided, however, that the Union has the
right to present a grievance as outlined in this Agreement, if 




                                       35
<PAGE>   36

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


there is any question as to whether such employees did so engage.

                                   ARTICLE XV
                                   ----------
                                     General
                                     -------

            SECTION 1. The Union agrees collectively and individually for its
members that they will not intimidate, coerce, or refuse to work cooperatively
with, any employee of the Company or with safe equipment or materials furnished
by the Company.

            SECTION 2. It is agreed that the right to determine who shall hold
foremanships or other supervisory positions remains vested exclusively in the
Company.

            SECTION 3. The parties to this Agreement agree that the members of
Local #431 and the Company officials, including supervisory personnel,
individually and collectively, will endeavor to perform loyal and efficient work
and service and to use their influence and best efforts to protect the property
of the Company and the Company's interest and to cooperate with each other in
promoting and advancing the welfare of the Company and its service at all times.

            SECTION 4. When meter readers are assigned to read the regular book
covering Westport Point, they shall receive an additional payment of $1.40 (20
miles @ 7(cent) per mile) upon completion of the book. When assigned to read the
regular book covering the North Swansea District (from Maple Avenue westerly to
Route 136), they shall receive an additional payment of 70(cent) (10 miles @
7(cent) per mile) upon completion of the book.

            SECTION 5. A. In the event that the meaning and intent of any
provision of this Agreement shall conflict with any Federal or State Law, order,
directive, or regulation now or hereafter enacted or issued, such provision
hereof shall not remain operative or binding upon the parties, but the remaining
portion of this Agreement shall remain in full force and effect.

                          B.  Should any provision of this Agreement be
invalidated as above stated, then the parties will reopen that portion of the
Agreement for the purpose of negotiating a new provision which will not conflict
with such law, order or 


                                       36
<PAGE>   37

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995




regulation, and the same shall thereafter become a part of this Agreement.

            SECTION 6. If an outside contractor is used to do work normally done
by employees in the bargaining unit, the Company agrees that it will not lay off
or reduce the pay rate of any employee in the bargaining unit while such
contractor is doing such work, and the Company will not, while such contractor
is doing such work, by any action of the Company, reduce any roster. The phrase
"action of the Company" shall not include reductions in the roster caused by
employees who quit, retire, die or cease to be employees because of partial or
total disability; provided, however, no reductions in roster caused by quitting,
retiring, dying, or ceasing to be employees because of partial or total
disability, shall allow the Company to increase its normal use of outside
contractors for work normally done by employees in the bargaining unit.

            SECTION 7. If the Union restricts its contract negotiating committee
to five (5) members, the Company will pay for time lost from work by the members
in negotiating a new contract. It being understood that the commitment of the
Company to pay for the member of the Union's negotiation team is limited to the
payment of the straight time hourly wages such member of the Union negotiation
team would have earned on the day of negotiation and if such employee is on
holiday or on a day off there will be no pay for attending and participating in
contract negotiations. Regardless of how long contract negotiations continue
there will be no pay for overtime or premium pay. The Company shall have the
right to fix the time, place and length of all meetings, but the meetings, if
any, held on the last two (2) days of the term of this Agreement shall last as
long as either party deems necessary. Both the Company and the Union agree to
use their best efforts to reach agreement on a new contract as soon as
reasonably possible.

            SECTION 8. If the Company believes that an employee may need a Union
representative at a meeting, the Company will convey this fact to the employee
as part of "see me notice". If at any time during the meeting the employee
believes that he would like to have a Union representative present, he has the
right to request one.




                                       37
<PAGE>   38

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



            SECTION 9. During the terms of the Agreement the Company will post
and fill in accordance with the provisions of this Agreement one (1) new job
classification to be that of " Senior Fitter". The one (1) new job
classification of "Senior Fitter" will be filled by the most senior "Fitter
Class A" having at least 25 years of service with the Company and at least 10
years of seniority as a "Fitter - Class A" and a person who is otherwise
qualified by fitness and ability to perform the job. The new job classification
of "Senior Fitter" shall be established to be in effect as of April 30, 1995
with a beginning wage rate of $18.65/hr. The establishment of such
classification shall not increase the roster of Union employees or the number
jobs in the Company and the filling of the classification of "Senior Fitter"
shall not create a vacancy in any job from which a qualified employee may
transfer, it being understood that the establishing of a job classification
called "Senior Fitter" is deemed for all purposes to be and is a
reclassification of such qualified employee.

                                   ARTICLE XVI
                                   -----------
                                  Notification
                                  ------------

            SECTION 1. A. Any employee covered by this Agreement who finds
himself, for good cause, compelled to be absent from work, shall notify a
supervisor (or such other person assigned by the Company to receive such
notification) of his inability to report for work, including details as to the
nature of the illness and an estimate of the duration of the absence. If said
employee is unable to make said report, then the report shall be made by an
appropriately informed person. The foregoing shall be deemed proper and complete
notification under the terms of this Agreement.

                          B.  The employee is required to give such notice as
far in advance as possible in order that the Company shall have sufficient time
to secure another employee to do the work.

            SECTION 2. When an employee has been off duty for an indefinite
period, such as in case of sickness, he shall be obligated to give notice of his
ability and intention to return to duty as far in advance as possible and at
least eight (8) hours before starting work, 



                                       38
<PAGE>   39

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


in order that the Company will have an opportunity to reschedule the employee
who has been filling the temporary vacancy.

            SECTION 3. The Company will endeavor to notify an employee who is
asked to report to work as a substitute for another employee in sufficient time.

                                  ARTICLE XVII
                                  ------------
                                     Safety
                                     ------

            SECTION 1.  A.  The Company will continue to make reasonable
regulations for the safety and health of its employees, not contrary to the
terms of this Agreement, during their hours of employment.

            All employees shall:-

                        1).   Comply with such reasonable safety regulations
                              which are now in effect or may later become
                              effective through the efforts of the safety
                              committee.

                        2).   Use the protective devices, wearing apparel and
                              other equipment provided by the Company for the
                              protection of the employees from injury.

                        3).   Do everything reasonably possible to avoid
                              accidents, and improve the safety experience of
                              the Department.

                          B.  Failure, after due warning, of an employee to
observe Company regulations for the safety and health of its employees, or
refusal to use protective devices provided by the Company, shall be sufficient
cause for disciplinary action, but the matter shall be taken up with the Union
before discharge.

                          C.  If, for safety reasons, a cold patch job requires 
two workers, the Company will assign a second employee to such cold patch job.

            SECTION  2. A.  SCOPE.  Pursuant to the Mandate of the Rules and
Regulations  published by the Department of Transportation ("DOT"), 49 CFR
Part 40, 54 Fed. Reg. 49854, Dec. 1, 1989, as amended, and 49 CFR Part 199,
54 Fed. Reg. 51842, as amended (herein the





                                       39
<PAGE>   40

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



"DOT Rules and Regs."), it is the intention of Company to conduct drug testing
as prescribed by the above DOT Rules and Regs. The Charlton Memorial Hospital (a
DOT approved collection agency) will be where all samples are taken. They will
be tested by a certified DHHS Laboratory. The doctor in charge at the Charlton
facility will be the M.R.O. In all instances, where an employee tests positive,
the results will be given by the M.R.O. to the Director of Employee Relations
and will be kept strictly confidential, except as may be necessary to notify
other persons in order to carry out the intent of this Drug Program. Supervisors
from each department of the Company will be given E.A.P. training and upon
completing the mandatory phase, periodic reviews will be given to update the
E.A.P. training. Any employee that tests positive will be offered assistance by
Family Services after returning from a Drug Rehabilitation Program.

                          B.  RANDOM  TESTING.   All employees required to
submit to random testing by the DOT Rules and Regulations will be assigned a
number for purposes of random drug testing selection. The actual selection of
employees will be done by computer program. The persons for random drug testing
will be selected on a monthly basis. One representative of the Union and the
Director of Employee Relations will be present at all times during the selection
process. A sufficient number of employees will be selected to comply with the
Fifty Percent (50%) testing schedule as prescribed by the DOT Rules and
Regulations. If an employee, whose number is selected by the random drawing
process, is on vacation or is not available, for any reason, to be tested, the
selection process will continue until a sufficient number of employees have been
selected for random testing.

                    C. CONFIRMED POSITIVE. An employee whose test has been
confirmed to be positive shall be removed forthwith from his or her job
assignment and shall be enrolled forthwith in a drug rehabilitation program of
the type defined in the DOT Rules and Regs. The cost and expense of such
rehabilitation program shall be borne by the then effective medical insurance
program to which the employee subscribes or to which the employee's spouse



                                       40
<PAGE>   41

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


subscribes. The time away from work by such first time removal of the said
employee shall be deemed to be a medical leave of absence and such employee may
apply for compensation from such employee's accumulated sick pay for absence
from work as a result of such first time removal. If such employee shall have a
second confirmed positive test for drugs such employee shall forthwith be
suspended from his or her job and shall forthwith be enrolled in a drug
rehabilitation program. Such second suspension shall be deemed to be leave of
absence without compensation of any kind and such employee shall not be entitled
to any compensation for time lost under accumulated sick days, but such employee
would be entitled to accrued vacation and/or personal days. If such employee is
approved to return to work by the MRO, such employee shall return to work only
on a "last chance" basis. A third confirmed positive test for drugs will result
in the immediate discharge of such employee for cause.

            SECTION 3. A. ALCOHOL TESTING POLICY - DOT RULES AND REGULATIONS.
Pursuant to the Mandate of the Rules and Regulations issued by the U.S.
Department of Transportation ("DOT"), and/or as the same may from time to time
be amended, the disciplinary procedures for work place alcohol testing in
accordance with the DOT Rules and Regulations, is adopted as set forth below.

            B. Any employee of the Company who is determined to be in the
possession of an open container of an alcoholic beverage or is determined to
have consumed alcohol during his/her work day, including any breaks, whether
paid or otherwise, may be terminated.

            C. Any employee of the Company who refuses to report for testing
and/or to produce an adequate amount of breath for sampling purposes, without
valid medical proof of the inability to provide such a sample, or engages in
conduct that clearly is intended to obstruct the testing procedure will be
terminated.

            D. Any employee of the Company who refuses to report for assessment,
evaluation, and/or referral for treatment with a substance abuse professional
and/or satisfactorily complete prescribe treatment, may be terminated.

            E. Any employee of the Company who has engaged in prohibited conduct
and 


                                       41
<PAGE>   42

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



has tested at an alcohol concentration of more that 0.02 but less that 0.04 may
be, for a first offense, suspended without pay for the duration of the current
shift. If the employee has a reoccurrence of testing in excess of 0.02 but less
that 0.04, within a two year period commencing with the date of the first
infraction, the employee may be suspended without pay for the duration of the
current shift and his/her entire next regularly scheduled shift. The employee
will be referred to a substance abuse professional who shall determine what
assistance, if any, the employee needs in resolving problems associated with
alcohol misuse. The employee shall be allowed to use accumulated sick leave
and/or vacation/personal days to complete any necessary rehabilitation
treatment, commencing with the third day following the date of the violation of
the AMPP. All time spent on rehabilitation endeavors, in excess of accumulated
sick leave, vacation time and/or personal days shall be taken as lost time for
the employee and shall not be compensated for by the Company. If the employee
has a third occurrence of testing in excess of 0.02 but less than 0.04, within a
two year period commencing with the date of the first infraction, the employee
may be terminated.

            F. Any employee of the Company who has engaged in prohibited conduct
and has tested at alcohol concentration of more than 0.04 may be suspended for
up to three days. If the employee has a reoccurrence of testing in excess 0.04,
within a two year period commencing with the date of the first infraction, the
employee may be suspended for up to ten days. The employee will be referred to a
substance abuse professional who shall determine what assistance, if any, the
employee needs in resolving problems associated with alcohol misuse. The
employee will be allowed to use accumulated sick time, vacation time and/or
personal days to comply with any needed rehabilitation program, commencing with
the eleventh day following the date of the violation of the AMPP. All time spent
on rehabilitation endeavors, in excess of accumulated vacation time and/or
personal days shall be taken as lost time for the employee and shall not
compensated for by the Company. If the employee has a third occurrence of
testing in excess of 0.04, within a three year period commencing with the date
of the first infraction, the employee may be terminated.





                                       42
<PAGE>   43

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995


            G. Any employee of the Company who has engaged in prohibited conduct
and has tested at an alcohol concentration of more than 0.02 but less than 0.04,
within a two year period commencing with the date the employee tested at an
alcohol concentration of more than 0.04, may be suspended for up to five days.
The employee will be referred to a substance abuse professional who shall
determine what assistance, if any, the employee needs in resolving problems
associated with alcohol misuse. The employee will be allowed to use accumulated
sick time, vacation time and/or personal days to comply with any needed
rehabilitation program, commencing with the sixth day following the date of the
violation of the AMPP. All time spent on rehabilitation endeavors, in excess of
accumulated vacation time and /or personal days shall be taken as lost time for
the employee and shall not be compensated for by the Company. If the employee
has a second occurrence of testing in excess of 0.02 but less than 0.04, within
a three year period commencing with the date the employee tested at alcohol
concentration of more than 0.04, the employee may be terminated.

            H. In certain Post-Accident situations, the Company may assess more
severe penalties than are set forth in the above policy, depending on the
severity of the incident and the degree of the violation. However, no deviance
of the above stated penalties will be assessed prior to the matter being
discussed with appropriate representatives of the Union.

            Section 4. Employees may, and are urged to, make safety suggestions
to the Company through the established Safety Committee of the Company.

                                  ARTICLE XVIII
                                  -------------

                          Additional Employee Benefits
                          ----------------------------

            SECTION 1. A. The Company agrees, during the period of the 1995
Agreement, that it will provide and pay for Blue Cross/Blue Shield "Master
Health Plus" Group Plan Insurance, including chiropractic, prescription drugs
and maternity benefits coverage, as was provided to bargaining unit employees
under the Labor Agreement dated as of May 1, 1990, or a mutually agreeable
equivalent health plan, without requiring the employees to pay any additional
cost for the Plan over the amount now paid for by the Company, except that
beginning 


                                       43
<PAGE>   44

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



with May 1, 1995, and continuing through the terms of the Agreement each member
of the bargaining unit will co-pay a portion of the cost of the medical-health
insurance in the amount of $7.50 per week. The amount to be paid by members of
the bargaining unit will be deducted from the pay of each member of the unit or
if such member elects to enter into a salary reduction plan for the amount of
the health insurance payment such amount will be deducted in accordance with the
written salary reduction agreement established by the Company so that such
employee may make such co-payments by a reduction in wages, so that the wages
used to make such co-payments will not subject to tax. The Union will be
provided with a copy of the Blue Cross Blue Shield monthly statement of benefits
paid for members of the bargaining unit with appropriate deletions thereto, to
protect the privacy of all persons.

                          B. If an employee has twenty-five (25) years or
more of service and is retired for total disability, the Company will continue
to pay his full family membership Blue Cross-Blue Shield, or its equivalent, up
to age 65.

                          C. If an employee continues his employment with the
Company up to age 62 or thereafter, and retires at age 62 or thereafter, the
Company will continue to pay his full family membership Blue Cross-Blue Shield,
or its equivalent, from the date of his retirement up to age 65.

            SECTION 2. The Company shall continue, during the term of this
Agreement, to include the employees in the coverage of the Pension Plan, as
amended. The Pension Plan shall be amended in the following respects:

                          A. To provide for the Company to take over full
payment of contributions to the Plan effective July 1, 1977.

                          B. To eliminate the penalty for early retirement at
ages 62 to 64, inclusive.

                          C. To provide that penalty for early retirement at
ages 61 down to 55 shall be one (1%) percent per year.

                          D. Effective May 1, 1987 the Company will make the
following 




                                       44
<PAGE>   45

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



change in the pension benefit formula for each present and future employee of
the Company. The pension benefit formula shall be modified to provide a present
annual benefit formula calculated using (a) and (b) as follows:

                        (a)   Either of (1) or (2) below which will produce
                              the highest benefit:

                              (1)   1% of the first $4,200 of the member's
                                    annual earnings as of July 1, 1986, plus 1
                                    and 1/2% of such earnings in excess of
                                    $4,200, multiplied by the years of credited
                                    service prior to July 1, 1986; or

                              (2)   1 and 1/2% of the first $4,200 of the
                                    member's annual earnings as of July 1, 1972,
                                    plus 2% of such earnings in excess of
                                    $4,200, multiplied by the years of credited
                                    service prior to July 1, 1972; plus 1 and
                                    1/2% of the first $4,200, plus 2% of the
                                    excess over $4,200 of the member's annual
                                    earnings for each year of credited service
                                    between July 1, 1972 and July 1, 1986; plus

                        (b)   2% of the member's annual earnings for each year
                              of credited service after July 1, 1986.

                          E.  PENSION PLAN IMPROVEMENTS.  Effective May 1, 1997
the Company will establish and add to the Company Pension Plan established
for members of the collective bargaining unit an Alternative Pension Plan with
the following retirement benefits for employees retiring from the Company at age
62 or thereafter: a monthly benefit determined by multiplying the number of
years of credited service on the retirement date times "55". Each employee
electing to retire from the Company on or after May 1, 1997 shall have the right
to elect, by written notice to the Company made 30 days prior to such employee's
date of retirement, between the Present Company Pension Plan and the new
Alternate Pension Plan.

            SECTION 3. The Company shall, during the term of this Agreement, pay
the premiums for group term Life Insurance carried for the employees with Fifty
Thousand Dollars 





                                       45
<PAGE>   46

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



($50,000) death benefit coverage.

            SECTION 4. The Company will continue the group term life insurance
coverage, for employees who hereafter retire, in the policy face value amount of
Five Thousand Dollars ($5,000), the premiums for same to be paid by the Company.

            SECTION 5. The Company shall provide and pay for Blue Cross-Blue
Shield Dental Blue Plan including coverage under: (i) Dental Group I Preventive
Benefit Group - Full, (ii) Dental Group II - Basic Benefit Group Full, (iii)
Dental Group III - Major Benefit Group -50%, and Orthodontic Benefit; with
"student" rider to age twenty-three (23) with $750.00 per calendar year per
person maximum benefit for Dental Groups I, II and III, and with a $1,000
lifetime benefit maximum for insured persons under the age of 19 years for the
Orthodontic Benefit, or a mutually agreeable equivalent Dental Plan for its
employees, both single and married. The Company will include in the Health Care
Plan for its employees covered by this agreement Blue Cross-Blue Shield Vision
Care Rider 14 - 002 or benefits which are substantially equal thereto.

             SECTION 6. In the event of the death of an employee who has
completed five (5) years of service with the Company, the Company will provide
the deceased's spouse, if any, and dependents with same medical coverage, at the
same cost, they would have been entitled to if the employee had lived. The
Company will provide said coverage for a period of the earlier of: (i) two (2)
years, commencing with the date of employee's death; or (ii) until such time as
the deceased's spouse remarries.

            SECTION 7. The Company will, to the extent set forth below,
reimburse employees for the employee's cost of any school and/or correspondence
courses, including the cost of books and supplies, taken by the employee on the
employee's own time if job-related or if a part of such employee's educational
program and if the taking of such course is approved by the Company prior to the
taking of such course, and if such course is given by an institution approved
and recognized by the Company as a bona fide educational institution; the
Company shall reimburse such employee for fifty percent (50%) of the cost of
such course, books and 




                                       46
<PAGE>   47

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995




supplies, upon evidence of completion of the course with a passing grade or
equivalent up to a maximum of $500.00 in any contract year. Should the employee
attain a grade of "A" or "B", said employee shall be reimbursed one hundred
percent (100%) of the cost of said course, books and supplies, up to a maximum
of $500.00 per contract year.

            SECTION 8.  Effective May 1, 1995, the present Long Term Disability
Plan ("L.T.D. Plan") of the Company will be modified such that the benefits will
be increased to seventy percent (70%) of an employee's straight time monthly
rate of pay. The entire cost of the L.T.D. Plan shall be paid for by the
Company.

            SECTION 9.  The Company shall maintain a plan (herein the "Savings
Plan"), whereby each employee, at his option, could have withheld from his
wages, certain amounts of money for deposit with St. Anne's Credit Union;
provided, however, any change in the amount withheld or the employee's option to
join or withdraw from the Savings Plan shall be limited to one time each
calendar quarter; and provided further that the Savings Plan shall not violate
any law, rule or regulation, nor subject the Company to any liability.

            SECTION 10. The Company shall, upon the retirement of an employee at
age 62 or older and if such employee has at least ten (10) years of continuous
service with the Company, shall grant such employee retiring at age 62 or older
a special retirement bonus, equal in amount to fifteen percent (15%) of the then
accumulated and unused sick days as provided for in Section 1 of Article IX, the
amount of special retirement bonus, to be determined as of the employee's
retirement date, and to be paid to such employee as a lump sum no later than on
employee's retirement date. At the employee's election, the special retirement
bonus shall be paid to the employee as "terminal leave" and can be taken
immediately prior to and in conjunction with the date such employee elects to
retire, in which case the accumulated allowance of sick days for which such
employee is eligible shall be determined on the date of the commencement of the
terminal leave. The employee shall have no right or claim as to any of the
remaining accumulated sick days which upon retirement shall lapse. If such
employee is reemployed, by the Company for any reason, in any capacity, as an
employee, consultant, or 



                                       47
<PAGE>   48

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995




otherwise, there shall be no crediting to the rehired employee's sick pay "bank"
any of the accumulated sick days which at the time of retirement were in the
employee's sick pay "bank". The payment of the special retirement bonus is
available to employees once during their employment with the Company, and if
such employee takes early retirement, and for any reason elects to be reemployed
by the Company, this retirement benefit shall thereafter be no longer available
to such employee.

            SECTION 11. 401(K) PLAN. The Company will establish a 401(k) Plan
for the members of the Collective Bargaining Unit beginning May 1, 1995 and the
Company will make a matching contribution of One Dollar ($1.00) for each One
Dollar ($1.00) of the employees' salary deferral contribution to such plan to a
maximum amount of three percent (3.00%) of the employee's annual payroll
earnings as an employee of the Company.


                                   ARTICLE XIX
                                   -----------
                                   Management
                                   ----------

            SECTION 1. The Company shall have the supervision of the work, the 
direction and distribution of its employees to meet the needs of the business 
in the efficient conduct and operation of its plant, the right to suspend or 
discharge, for proper cause, or furlough because of lack of work, all subject 
to the provisions of the Articles of this Agreement.

            SECTION 2. All other powers, rights,privileges, management  
prerogatives and responsibilities not otherwise referred to herein shall remain
with the Company, including the right on the part of the Company, at all times
to change any of its operations, to continue or discontinue its business, or to
change, alter, or modify the nature of its business or its method of doing
business.

            SECTION 3. All regulations for the proper operation of the plant    
processes as now in effect, or as adopted or changed by the Company in the
future, not inconsistent with the terms of this Agreement, shall be strictly
observed and enforced at all times.

            SECTION 4. If the Union claims that the Company has exercised any   
of the rights set forth in this Article without justifiable cause or reason,
such claim shall be subject to the grievance procedure


                                       48
<PAGE>   49

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995





and Arbitration under the terms of this Agreement.

                                   ARTICLE XX
                                   ----------

                          No Further Demands or Claims
                          ----------------------------

            SECTION 1. This Agreement expresses the full and complete   
understanding of the parties on the subjects of working conditions, hours of
labor and other conditions of employment, including rates of pay, wages, and
methods of wage payment. This mutual understanding has been reached after many
hours of collective bargaining and represents concessions which have been made
by both parties, in order to reach an understanding. Any subject matter not
mentioned herein is hereby specifically waived, and it is agreed that neither
the Union nor the Company will present any demands or claims not included
herein during the life of this Agreement, unless it is agreed by both parties
that changes in, or amendments to, this Agreement are desirable.

                                   ARTICLE XXI
                                   -----------

           Gender; Term of Agreement; Negotiation of New Agreement
           -------------------------------------------------------

            SECTION 1. Words of any gender used in this Agreement shall be
deemed to include the other gender. Words in the singular shall be deemed to
include the plural when the sense requires and the reverse shall also be true.

            SECTION 2. The term of this Agreement shall begin on the date
hereof, and shall be binding upon the parties hereto, and shall remain in full
force and effect for a period of four (4) years, and shall thereafter
automatically be renewed for a period of One (1) year unless either party shall
notify the other party in writing at least sixty (60) days prior to the date of
expiration of this Agreement or any renewal thereof, that it desires to change
or modify the terms thereof. Negotiations for the renewal of this Agreement for
a further term following the date of expiration hereof shall commence at least
thirty (30) days prior to such date of expiration.

            IN WITNESS WHEREOF, the Company and the Union, each by its duly
authorized officers, have executed this AGREEMENT as of the day and year first
above written.

                                             FALL RIVER GAS COMPANY



                                       49
<PAGE>   50

              Agreement: Fall River Gas Company and Local 431 UWUA
                               Dated: May 1, 1995



                                       By:
                                          -------------------------------
                                          Bradford J. Faxon,
                                           President


                 UTILITY WORKERS UNION OF AMERICA, LOCAL #431


                                    By 
                                       --------------------------------
                                          James R. Tavares, President

                                    By                                  
                                       -------------------------------- 
                                          Boetius W. Sullivan

                                    By                                  
                                       -------------------------------- 
                                          M. J. Stukus

                                    By                                  
                                       --------------------------------  
                                          Paul Camara
                                    
                                    
                                    By                                  
                                       --------------------------------      
                                          M. E. Perry
                                    
                                    By                                  
                                       -------------------------------- 
                                    National Representative of
                                           UTILITY WORKERS UNION OF
                                    AMERICA, AFL-CIO


        See "Letter of Understanding" attached hereto as Exhibit "E".



                                       50