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                                                                  Exhibit 10(dd)


                               SEVERANCE AGREEMENT
                                     BETWEEN
                             FALL RIVER GAS CONPANY
                                       AND
                                BRADFORD J. FAXON


THIS AGREEMENT, effective this first day of January, 1999, by and between Fall
River Gas Company, a Massachusetts Corporation (the "Company") and Bradford J.
Faxon (the "Executive").

                                   WITNESSETH:

         WHEREAS, the Executive is a valuable employee of Fall River Gas
Company, an integral part of its management, and a key participant in the
decision-making process relative to short-term and long-term planning and policy
for the Company; and

         WHEREAS, the Company wishes to encourage the Executive to continue the
Executive's career and services with the Company for the period during and after
an actual or threatened Change in Control; and

         WHEREAS, the Board of Directors of the Company, at a meeting on
February 10, 1998, determined that it would be in the best interests of the
Company and its shareholders to better assure continuity in the management of
the Company's administration and operations in the event of a Change in Control
by entering into this Severance Agreement (the "Agreement") with the Executive;

         NOW THEREFORE, it is hereby agreed by and between the parties hereto as
follows:

         1. Definitions.

            (a) "Board" shall mean the Board of Directors of the Company.

            (b) "Cause" shall have the same meaning as is provided in the
      Executives Employment Agreement.

            (c) Change in Control" shall mean:

                (i)     any person (as such term is used in Section 13(d) of the
                        Securities Exchange Act of 1934 (the "Act"), excluding a
                        corporation at least 90% of the ownership of which after
                        acquiring its interest is owned directly by the holder
                        of common shares of the Company immediately prior to
                        such acquisition ("Person"), is the beneficial owner,
                        directly or indirectly, of twenty (20) percent or more
                        of the outstanding common shares of the Company (other
                        than the Savings Plan) requiring the filing of a report
                        with the Securities and Exchange Commission under
                        Section 13(d) of the 1934 Act;

                (ii)    a purchase by any Person of shares pursuant to a tender
                        or exchange offer to acquire any common shares of the
                        Company (or securities convertible into common shares)
                        for cash, securities, or any other consideration
                        provided that, after consummation of the offer, such
                        Person is the beneficial owner (as defined in Rule l3d-3
                        under the 1934 Act), directly or indirectly, of twenty
                        (20) percent or more of the outstanding common shares of
                        the Company (calculated as provided in paragraph (d) of
                        Rule 13d-3 under the 1934 Act in the case of rights to
                        acquire common shares);

                (iii)   approval by the shareholders of the Company of (a) any
                        consolidation or merger of the Company in which the
                        Company is not the continuing or surviving corporation
                        or



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                        pursuant to which common shares of the Company would
                        be converted into cash, securities, or other
                        property, other than a consolidation or merger of the
                        Company in which holders of its common shares
                        immediately prior to the consolidation or merger own
                        at least 90% of the common shares of the surviving
                        corporation immediately after the consolidation or
                        merger, or (b) any consolidation or merger in which
                        the Company is the continuing or surviving
                        corporation but in which the common shareholders of
                        the Company immediately prior to the consolidation or
                        merger do not hold at least 90% of the outstanding
                        common shares of the continuing or surviving
                        corporation (except where such holders of common
                        stock hold at least 90% of the common shares of the
                        corporation which owns all of the common shares of
                        the Company), or (c) any sale, lease, exchange, or
                        other transfer (in one transaction or a series of
                        related transactions) of all or substantially all the
                        assets of the Company, or (d) any merger or
                        consolidation of the Company where, after the merger
                        or consolidation, one Person owns 100% of the common
                        shares of the Company (except where the common
                        holders of the Company's common shares immediately
                        prior to such merger or consolidation own at least
                        90% of the outstanding common shares of such Person
                        immediately after such merger or consolidation) (upon
                        the Board's determination that the transaction
                        subject to shareholder approval hereunder will not be
                        consummated, a Change in Control shall not be deemed
                        to have occurred from such date forward and this
                        Agreement shall continue in effect as if no Change in
                        Control had occurred, except to the extent
                        termination requiring Severance Benefits under
                        paragraph 3 hereof has occurred prior to such Board's
                        determination); or

                (iv)    a change in the majority of the members of the Board
                        within a 24-month period unless the election or
                        nomination for election or nomination for election by
                        the Company's common shareholders of each new director
                        was approved by the vote of at least two-thirds of the
                        Directors then still in office who were in office at the
                        beginning of the 24-month period.

            (d) "Code" shall mean the Internal Revenue Code of 1986, as amended.

            (e) "Compensation" shall mean the sum of (i) the Executive's annual
      rate of base salary on the last day the Executive was an employee of the
      Company (or if higher, the annual rate in effect on the date of the Change
      in Control), including any elective contributions made by the Company on
      behalf of the Executive that are not includible in the gross income of the
      Executive under Sections 125 or 402(a)(8) of the Code or any successor
      provision thereto, and (ii) the average of the annual incentive payments
      paid to the Executive by the Company, if any, for the three consecutive
      calendar years immediately preceding employment termination (or a lesser
      period if the Executive was not eligible to receive annual incentive
      payments during such three year period).

            (f) "Coverage Period" means the period beginning on the Starting
      Date and ending on the Ending Date.

            (g) "Disability" means the Executive's incapacity due to physical or
      mental illness, which incapacity causes the Executive to be absent from
      his duties on a full time basis for 90 consecutive business days.

            (h) "Employment Agreement" shall mean the employment agreement
      between the Company and the Executive, entered into on October 7, 1991,
      together with any amendments thereto.

            (i) "Ending Date" means the earlier of (i) the date of the Board's
      determination that the transaction which was approved by the Company's
      shareholders, thus constituting a Change in Control pursuant to paragraph
      1(c)(iii), will not be consummated, or (ii) the date which is 36 full
      calendar months following the date on which a Change in Control occurs or,
      if a Change in Control is based on shareholder approval pursuant to
      paragraph 1(c)(iii) hereof, the date which is 36 full calendar months
      following the date of the consummation of the transaction which was the
      subject of shareholder approval.

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            (j) "Good Reason" shall mean any of the following:

                  (i) material change by the Company of the Executive's
            functions, duties or responsibilities which change would cause the
            Executive's position with the Company to become of less dignity,
            responsibility, importance, prestige or scope, including, without
            limitation, a change from being a senior officer of a publicly held
            company;

                  (ii) assignment or reassignment by the Company of the
            Executive without the Executive's consent to another place of
            employment more than 50 miles from the Executive's current place of
            employment; or

                  (iii) a reduction which is more than de minimis in the
            Executive's base pay or bonus opportunity except if such reduction
            is part of a reduction for all executive officers of the Company and
            any parent Company thereof.

            No such event described above shall constitute Good Reason unless
            the Executive gives written notice to the Company, specifying the
            event relied upon for such termination and given at any time within
            one year after the occurrence of such event and the Company has not
            remedied such within 30 days of the notice. The Company and
            Executive, upon mutual written agreement may waive any of the
            foregoing provisions which would otherwise constitute a Good Reason.

            (k) "Single Trigger Period" means the eighteen month period which
      (i) begins on the date on which a Change in Control occurs, or if a
      Change in Control is based on shareholder approval pursuant to
      paragraph 1(c)(iii) hereof, the date of the consummation of the
      termination which was the subject of shareholder approval, and (ii)
      ends eighteen months thereafter.

            (1) "Starting Date" means the date on which a Change in Control
      occurs.

            2. TERM. This Agreement shall be effective as of the date above
      written and shall continue thereafter for 36 full calendar months
      following the date of an occurrence of a Change in Control or, if the
      Change in Control event is based on shareholder approval pursuant to
      paragraph 1(c)(iii), 36 full calendar months following the date of the
      consummation of the transaction which was the subject of shareholder
      approval.

            3. SEVERANCE BENEFIT. If (i) at any time during the Coverage Period,
      the Executive's employment hereunder is terminated by the Company for any
      reason other than Cause, death or Disability, or by the Executive for Good
      Reason, or (ii) during the Single Trigger Period, the Executive terminates
      his employment for any reason, then,

                  (a)   within five business days after such termination, the
                        Company shall pay to the Executive (or, if the Executive
                        has died before receiving all payments to which the
                        Executive has become entitled hereunder, to the estate
                        of the Executive) (i) accrued but unpaid salary and
                        accrued but unused vacation, if any, and (ii) severance
                        pay in a lump sum cash amount equal to three (3) times
                        the Executive's Compensation;

                  (b)   to the extent not paid or payable under such plans
                        and/or arrangements, the Company shall pay to the
                        Executive the present value of the benefits (calculated
                        assuming the Executive will begin receiving benefits at
                        the earliest retirement date under such plans and/or
                        arrangements, or if later, at the end of the term of
                        this Agreement, based on the actuarial assumptions used
                        for purposes of the qualified defined benefit plan) that
                        would have accrued, but did not accrue, under the
                        Company's qualified defined benefit retirement plan, the
                        Fall River Gas Company Survivor Benefit Deferred
                        Compensation Agreement, and the excess pension benefit
                        provision in the Employment Agreement and/or any
                        successor or similar plan(s) or arrangements in place
                        and operational on the date of termination and/or the
                        Change in Control, as if (for vesting, benefit accrual,
                        eligibility for early retirement, subsidized early
                        retirement factors, actuarial



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                        equivalence, and any other purposes) the Executive had
                        continued to be employed and had continued to
                        participate in such plans and arrangements through the
                        end of the term of this Agreement; it being understood
                        by all parties hereto that payments made under this
                        Agreement and the deemed additional credited service
                        shall not be considered for purposes of determining the
                        actual benefit payable under the terms of such plans and
                        arrangements and shall not be considered part of the
                        relevant payroll records for purposes of such plans and
                        arrangements; and

                  (c)   to the extent not already provided under the terms of
                        the Employment Agreement, for a period commencing with
                        the month in which termination of employment, as
                        described in paragraph 3 hereof, shall have occurred,
                        and ending the later of the date of the Executive's or
                        the Executive's spouse's death, the Executive, his
                        spouse and any dependents shall continue to be entitled
                        to receive all health and dental care benefits under the
                        Company's welfare benefit plans (within the meaning of
                        Section 3(l) of the Employee Retirement Income Security
                        Act of 1974, as amended), at no cost to the Executive
                        and at the same level of benefits that the Executive,
                        his spouse and his dependents were receiving or were
                        entitled to receive at the time of termination of
                        employment or, if it would result in greater benefits,
                        at the date of the Change in Control (if and to the
                        extent that such benefits shall not be payable or
                        provided under any Company plan, the Company shall pay
                        or provide equivalent benefits on an individual basis).

            4. CERTAIN ADDITIONAL PAYMENTS.

                        (a) If Independent Tax Counsel shall determine that the
                  aggregate payments made to the Executive pursuant to this
                  Agreement and any other payments to the Executive from the
                  Company which constitute "parachute payments" as defined in
                  Section 280G of the Code (or any successor provision thereto)
                  ("Parachute Payments") would be subject to the excise tax
                  imposed by Section 4999 of the Code (the "Excise Tax"), then
                  the Executive shall be entitled to receive an additional
                  payment (a "Gross-Up Payment") in an amount (determined by
                  Independent Tax Counsel) such that after payment by the
                  Executive of all taxes (including any Excise Tax) imposed upon
                  the Gross-Up Payment and any interest or penalties imposed
                  with respect to such taxes, the Executive retains from the
                  Gross-Up Payment an amount equal to the Excise Tax imposed
                  upon the payments. For purposes of this paragraph 4(a),
                  "Independent Tax Counsel" shall mean a lawyer, a certified
                  public accountant with a nationally recognized accounting
                  firm, or a compensation consultant with a nationally
                  recognized actuarial and benefits consulting firm, with
                  expertise in the area of executive compensation tax law, who
                  shall be selected by the Executive and shall be reasonably
                  acceptable to the Company, and whose fees and disbursements
                  shall be paid by the Company.

                        (b) If Independent Tax Counsel shall determine that no
                  Excise Tax is payable by the Executive, it shall furnish the
                  Executive with a written opinion that the Executive has
                  substantial authority not to report any Excise Tax on the
                  Executive's Federal income tax return. If the Executive is
                  subsequently required to make a payment of any Excise Tax,
                  then the Independent Tax Counsel shall determine the amount
                  (the amount of such additional payments are referred herein as
                  "Gross-Up Underpayment") of such payment and any such Gross-Up
                  Underpayment shall be promptly paid by the Company to or for
                  the benefit of the Employee. The fees and disbursements of the
                  Independent Tax Counsel shall be paid by the Company.

                        (c) The Executive shall notify the Company in writing
                  within 15 days of any claim by the Internal Revenue Service
                  that, if successful, would require the payment by the Company
                  of a Gross-Up Payment. If the Company notifies the Executive
                  in writing that it desires to contest such claim and that it
                  will bear the costs and provide the indemnification as
                  required by this sentence, the Executive shall:

                              (i) give the Company any information reasonably
                        requested by the Company relating to such claim,

                              (ii) take such action in connection with
                        contesting such claim as the Company shall reasonably
                        request in writing from time to time, including, without
                        limitation, accepting



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                        legal representation with respect to such claim by an
                        attorney reasonably selected by the Company,

                              (iii) cooperate with the Company in good faith in
                        order to effectively contest such claim, and

                              (iv) permit the Company to participate in any
                        proceedings relating to such claim; provided, however,
                        that the Company shall bear and pay directly all costs
                        and expenses (including additional interest and
                        penalties) incurred in connection with such contest and
                        shall indemnify and hold the Executive harmless, on an
                        after-tax basis, for any Excise Tax or income tax,
                        including interest and penalties with respect thereto,
                        imposed as a result of such representation and payment
                        of costs and expenses. The Company shall control all
                        proceedings taken in connection with such contest;
                        provided, however, that if the Company directs the
                        Executive to pay such claim and sue for a refund, the
                        Company shall advance the amount of such payment to the
                        Executive, on an interest-free basis and shall indemnify
                        and hold the Executive harmless, on an after-tax basis,
                        from any Excise Tax or income tax, including interest or
                        penalties with respect thereto, imposed with respect to
                        such advance or with respect to any imputed income with
                        respect to such advance.

                  (d) If, after the receipt by the Executive of an amount
            advanced by the Company pursuant to paragraph 4(c)(iv), the
            Executive becomes entitled to receive any refund with respect to
            such claim, the Executive shall, within 10 days, pay to the Company
            the amount of such refund (together with any interest paid or
            credited thereon after taxes applicable thereto).

            5. NO MITIGATION REQUIRED. In the event of any termination of the
      Executive's employment described in paragraph 3, the Executive shall be
      under no obligation to seek other employment, and there shall be no offset
      against amounts due the Executive under this Agreement on account of any
      remuneration attributable to any subsequent employment; provided, however,
      to the extent the Executive receives medical and health benefits from a
      subsequent employer, medical and health benefits under paragraph 3(c)
      shall be secondary to those received from the subsequent employer..

            6.SOURCE OF PAYMENTS. All payments provided for in this Agreement
      shall be paid in cash from the general funds of the Company; provided,
      however, such payments shall be reduced by the amount of any payments made
      to the Executive or the Executive's dependents, beneficiaries, or estate
      from any trust or special or separate fund established by the Company to
      assure such payments. The Company shall not be required to establish a
      special or separate fund or other segregation of assets to assure such
      payments, and, if the Company shall make any investments to aid it in
      meeting its obligations hereunder, the Executive shall have no right,
      title, or interest whatever in or to any such investments except as may
      otherwise be expressly provided in a separate written instrument relating
      to such investments. Nothing contained in this Agreement, and no action
      taken pursuant to its provisions, shall create or be construed to create a
      trust of any kind, or a fiduciary relationship between the Company and the
      Executive or any other person. To the extent that any person acquires a
      right to receive payments from the Company, such right shall be no greater
      than the right of an unsecured creditor of the Company.

            7. LITIGATION EXPENSES: ARBITRATION.

                  (a)   Full Settlement, Litigation Expenses; Arbitration. The
                        Company's obligation to make the payments provided for
                        in this Agreement and otherwise to perform its
                        obligations hereunder shall not be affected by any
                        set-off, counterclaim, recoupment, defense or other
                        claim, right or action which the Company may have
                        against the Executive or others. In no event shall the
                        Executive be obligated to seek other employment or take
                        any other action by way of mitigation of the amounts
                        payable to the Executive under any of the provisions of
                        this Agreement. The Company agrees to pay, upon written
                        demand therefor by the Executive, all legal fees and
                        expenses which the Executive may reasonably incur as a
                        result of any dispute or contest by or


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                        with the Company or others regarding the validity or
                        enforceability of, or liability under, any provision of
                        this Agreement (except to the extent it is determined by
                        a court of competent jurisdiction, mediator or
                        arbitrator, as the case may be, that the Executive's
                        material claim is, or claims are, frivolous or without
                        merit in which case the Executive shall bear all such
                        fees and expenses), together with interest on any
                        delayed payments at the applicable Federal rate provided
                        for in Section 7872(f)(2) of the Code. In any such
                        action brought by the Executive for damages or to
                        enforce any provisions of this Agreement, the Executive,
                        in his sole discretion, shall be entitled to seek both
                        legal and equitable relief and remedies, including,
                        without limitation, specific performance of the
                        Company's obligations hereunder. If the parties hereto
                        so agree in writing, any disputes under this Agreement
                        may be settled by arbitration. The obligation of the
                        Company under this paragraph 7 shall survive the
                        termination for any reason of this Agreement (whether
                        such termination is by the Company, by the Executive,
                        upon the expiration of this Agreement or otherwise).

                        (b) In the event of any dispute or difference between
                  the Company and the Executive with respect to the subject
                  matter of this Agreement and the enforcement of rights
                  hereunder, the Executive may, in the Executive's sole
                  discretion by written notice to the Company, require such
                  dispute or difference to be submitted to arbitration. The
                  arbitrator or arbitrators shall be selected by agreement of
                  the parties or, if they cannot agree on an arbitrator or
                  arbitrators within 30 days after the Executive has notified
                  the Company of Executive's desire to have the question settled
                  by arbitration, then the arbitrator or arbitrators shall be
                  selected by the American Arbitration Association (the "AAA")
                  in Boston, Massachusetts upon the application of the
                  Executive. The determination reached in such arbitration shall
                  be final and binding on both parties without any right of
                  appeal or further dispute. Execution of the determination by
                  such arbitrator may be sought in any court of competent
                  jurisdiction. The arbitrators shall not be bound by judicial
                  formalities and may abstain from following the strict rules of
                  evidence and shall interpret this Agreement as an honorable
                  engagement and not merely as a legal obligation. Unless
                  otherwise agreed by the parties, any such arbitration shall
                  take place in Boston, Massachusetts, and shall be conducted in
                  accordance with the Rules of the AAA.

            8.    INCOME TAX WITHHOLDING. The Company may withhold from any
                  payments made under this Agreement all federal, state, or
                  other taxes as shall be required pursuant to any law or
                  governmental regulation or ruling.

                  9. ENTIRE UNDERSTANDING. This Agreement contains the entire
            understanding between the Company and the Executive with respect to
            the subject matter hereof and supersedes any similar agreement
            between the Company and the Executive, except that this Agreement
            shall not affect or operate to reduce any benefit or compensation
            inuring to the Executive of any kind elsewhere provided and not
            expressly provided for in this Agreement including, without
            limitation, any benefit or compensation under the Employment
            Agreement and/or the Fall River Gas Company Survivor Benefit
            Deferred Compensation Agreement.

            10.   SEVERABILILY. If, for any reason, any one or more of the
                  provisions or part of a provision contained in this Agreement
                  shall be held to be invalid, illegal or unenforceable in any
                  respect, such invalidity, illegality or unenforceability shall
                  not affect any other provision or part of a provision of this
                  Agreement not held so invalid, illegal or unenforceable, and
                  each other provision or part of a provision shall to the full
                  extent consistent with law continue in full force and effect.

                  11. CONSOLIDATION, MERGER. OR SALE OF ASSETS. If the Company
            consolidates or merges into or with, or transfers all or
            substantially all of its assets to, another entity the term "the
            Company" as used herein shall mean such other entity and this
            Agreement shall continue in full force and effect.

                  12. NOTICES. All notices, requests, demands and other
            communications required or permitted hereunder shall be given in
            writing and shall be deemed to have been duly given if delivered or
            mailed, postage prepaid, first class as follows:

                  a. to the Company;



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                     Fall River Gas Company
                     155 North Main Street
                     Fall River, Massachusetts 02722
                     Attention:
                               --------------

                  b. to the Executive:

                     ------------------------
                     ------------------------
                     ------------------------


                     or to such other address as either party shall have
                     previously specified in writing to the other.

                  13. NO ATTACHMENT. Except as required by law, no right to
            receive payments under this Agreement shall be subject to
            anticipation, commutation, alienation, sale, assignment,
            encumbrance, charge, pledge or hypothecation or to execution,
            attachment, levy or similar process or assignment by operation of
            law, and any attempt, voluntary or involuntary, to effect any such
            action shall be null, void and of no effect.

                  14. BINDING AGREEMENT. This Agreement shall be binding upon,
            and shall inure to the benefit of, the Executive and the Company and
            their respective permitted successors and assigns.

            15.   MODIFICATION AND WAIVER. Prior to the date of a Change in
                  Control, this Agreement may be terminated, modified, amended
                  or terminated by action of a majority of the members of the
                  Board. After a Change in Control, this Agreement may not be
                  modified or amended except by an instrument in writing signed
                  by the parties hereto. No term or condition of this Agreement
                  shall be deemed to have been waived, nor shall there be any
                  estoppel against the enforcement of any provision of this
                  Agreement, except by written instrument signed by the party
                  charged with such waiver or estoppel. No such written waiver
                  shall be deemed a continuing waiver unless specifically stated
                  therein, and each such waiver shall operate only as to the
                  specific term or condition waived and shall not constitute a
                  waiver of such term or condition for the future or as to any
                  act other than that specifically waived.

                  16. HEADING OF NO EFFECT. The paragraph headings contained in
            this Agreement are included solely for convenience of reference and
            shall not in any way affect the meaning or interpretation of any of
            the provisions of this Agreement.

                  17. GOVERNING LAW. This Agreement and its validity,
            interpretation, performance, and enforcement shall be governed by
            the laws of the Commonwealth of Massachusetts without giving effect
            to the choice of law provisions in the Commonwealth of
            Massachusetts.

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its
officers thereunto duly authorized, and the Executive has signed this Agreement,
all effective as of the date first above written.

Witness:                                       Fall River Gas Company:

                                               By:
-------------------------------                   ------------------------------
                                               Title:
                                                     ---------------------------

Witness:
                                               By:
-------------------------------                   ------------------------------
                                               Title:
                                                     ---------------------------

Witness:                                       Executive:
-------------------------------                ---------------------------------


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