Document:

MDU RESOURCES GROUP, INC.

             EXECUTIVE INCENTIVE COMPENSATION PLAN
   ____________________________________________________________

  I. PURPOSE

     The purpose of the Executive Incentive Compensation Plan
(the "Plan") is to provide an incentive for key executives of MDU
Resources Group, Inc. (the "Company") to focus their efforts on
the achievement of challenging and demanding corporate
objectives.  The Plan is designed to reward successful corporate
performance as measured against specified performance goals as
well as exceptional individual performance.  When corporate
performance reaches or exceeds the performance targets and
individual performance is exemplary, incentive compensation
awards, in conjunction with salaries, will provide a level of
compensation which recognizes the skills and efforts of the key
executives.

 II. BASIC PLAN CONCEPT

     The Plan provides an opportunity to earn annual incentive
compensation based on the achievement of specified annual
performance objectives.  A target incentive award for each
individual within the Plan is established based on the position
level and actual base salary, provided, however, that the
Committee in its sole discretion, may, instead of actual base
salary, use the assigned salary grade market value (midpoint)
("Salary").  The target incentive award represents the amount to
be paid, subject to the achievement of the performance objective
targets established each year.  Larger incentive awards than
target may be authorized when performance exceeds targets; lesser
or no amounts may be paid when performance is below target.
     It is recognized that during a Plan Year major unforeseen
changes in economic and environmental conditions or other
significant factors beyond the control of management may
substantially affect the ability of the Plan Participants to
achieve the specified performance goals.  Therefore, in its
review of corporate performance the Compensation Committee of the
Board of Directors (the "Committee"), in consultation with the
Chief Executive Officer of MDU Resources Group, Inc., may modify
the performance targets.  However, it is contemplated that such
target modifications will be necessary only in years of unusually
adverse or favorable external conditions.

III. ADMINISTRATION

     The Plan shall be administered by the Committee with the
assistance of the Chief Executive Officer of the MDU Resources
Group, Inc.  The Committee shall approve annually, prior to the
beginning of each Plan Year, the list of eligible Participants,
and the target incentive award level for each position within the
Plan.  The Plan's performance targets for the year shall be
approved by the Committee no later than its regularly scheduled
February meeting during that Plan Year.  The Committee shall have
final discretion to determine actual award payment levels, method
of payment, and whether or not payments shall be made for any
Plan Year.
     The Board of Directors of the Company may, at any time and
from time to time, alter, amend, supercede or terminate the Plan
in whole or in part, provided that no termination, amendment or
modification of the Plan shall adversely affect in any material
way an award that has met all requirements for payment without
the written consent of the participant holding such award, unless
such termination, modification or amendment is required by
applicable law.

 IV. ELIGIBILITY

     Executives who are determined by the Committee to have a key
role in both the establishment and achievement of Company
objectives shall be eligible to participate in the Plan.
     Nothing in the Plan shall interfere with or limit in any way
the right of the Company to terminate any Participant's
employment at any time, for any reason or no reason in the
Company's sole discretion, or confer upon any Participant any
right to continue in the employment of the Company.  No executive
shall have the right to be selected to receive an award under the
Plan, or, having been so selected, to be selected to receive a
future award.

  V. PLAN PERFORMANCE MEASURES

     Performance measures shall be established that consider
shareholder and customer interests.  These measures shall be
evaluated annually based on achievement of specified goals.
     The performance measure reflective of shareholder's
interest will be the percentage attainment of corporate goals,
as determined each year by the Committee.  This measure may be
applied at the corporate level for individuals, such as the
Chief Executive Officer, or at the business unit level for
individuals whose major or sole impact is on business unit
results.
     Individual performance will be assessed based on the
achievement of annually established individual objectives.
     Threshold, target and maximum award levels will be
established annually for each performance measure and business
unit.  The Committee will retain the right to make all
interpretations as to the actual attainment of the desired
results and will determine whether any circumstances beyond the
control of management need to be considered.

 VI. TARGET INCENTIVE AWARDS

     Target incentive awards will be expressed as a percentage of
each Participant's Salary.  These percentages shall vary by
position and reflect larger reward opportunity for positions
having greater effect on the establishment and accomplishment of
the Company's or business unit's objectives.  An exhibit showing
the target awards as a percentage of Salary for eligible
positions will be attached to this Plan at the beginning of each
Plan Year.

VII. INCENTIVE FUND DETERMINATION

     The target incentive fund is the sum of the individual
target incentive awards for all eligible Participants.  The
actual incentive fund may be lower, equal to, or greater than the
target fund as determined by the Committee, based on actual
performance as compared with approved performance objectives.
     At the close of each Plan Year, the Chief Executive
Officer of MDU Resources Group, Inc. will prepare an analysis
showing the Company's and business unit's performance in relation
to each of the performance measures employed.  This will be
provided to the Committee for review and comparison to threshold,
target and maximum performance levels.  In addition, any
recommendations of the Chief Executive Officer will be presented
at this time.  The Committee will then determine the amount of
the target incentive fund earned.

VIII.INDIVIDUAL AWARD DETERMINATION

     Each individual Participant's award will be based first upon
the level of performance achieved by the Company or business unit
and secondly based upon the individual's performance.  The
performance measures applicable for assessing individual
performance will be established at the beginning of each Plan
Year.  The assessment by the Committee, after consultation with
the Chief Executive Officer, of achievement relative to the
established performance measures, as determined by a percentage
from 0 percent to 200 percent, will be applied to the
Participant's target incentive award which has been first
adjusted for Company or business unit performance.

 IX. PAYMENT OF AWARDS

     Except as provided below or as otherwise determined by the
Committee, in order to achieve an award under the Plan, the
Participant must remain in the employment of the Company or
business unit for the entire Plan Year and be an employee on the
Payment Date.  If a Participant terminates employment with MDU
Resources Group, Inc. pursuant to Section 5.01 of the Company's
Bylaws which provides for mandatory retirement for certain
officers on their 65th birthday (or terminates employment with a
subsidiary of the Company pursuant to a similar subsidiary Bylaw
provision) and if the Participant's 65th birthday occurs during
the Plan Year, determination of whether the performance measures
have been met will be made at the end of the Plan Year, and to
the extent met, payment of the award will be made to the
Participant, prorated.  Proration of awards shall be based upon
the number of full months elapsed from and including January to
and including the month in which the Participant's 65th birthday
occurs.
     An individual Participant who transfers between the Company
and business units may receive a prorated award at the discretion
of the Committee.  If employment is terminated prior to the
Payment Date as a result of death, disability or retirement, or
due to special circumstances as determined by the Committee,
payment may be made after termination.  Payments made under this
Plan will not be considered part of compensation for pension
purposes.  Payments when made will be in cash.  Incentive awards
may be deferred if the appropriate elections have been executed
prior to the end of the Plan Year.  Deferred amounts will accrue
interest at a rate determined annually by the Committee.
     In the event of a "Change in Control" (as defined by the
Committee in its Rules and Regulations) then any award deferred
by each Participant shall become immediately payable to the
Participant in cash, together with accrued interest thereon to
the date of payment.  In the event the Participant files suit to
collect the Participant's deferred award then all of the court
costs, other expenses of litigation, and attorneys' fees shall be
paid by the Company in the event the Participant prevails upon
any of the Participant's claims for payment of a deferred award.

                   MDU RESOURCES GROUP, INC.

             EXECUTIVE INCENTIVE COMPENSATION PLAN

                      RULES AND REGULATIONS

     The Compensation Committee of the Board of Directors of MDU
Resources Group, Inc. (the "Company") adopted Rules and Regulations
for the administration of the Executive Incentive Compensation Plan
(the "Plan") on February 9, 1983, following adoption of the Plan by
the Board of Directors of the Company on November 4, l982.

  I. DEFINITIONS

     The following definitions shall be used for purposes of these
Rules and Regulations and for the purposes of administering the
Plan:

     1.  The "Committee" shall be the Compensation
         Committee of the Board of Directors of the
         Company.

     2.  The "Company" shall refer to MDU Resources
         Group, Inc. alone and shall not refer to its
         utility division or to any of its subsidiary
         corporations.

     3.  "Participants" for any Plan Year shall be
         those executives who have been approved by the
         Committee as eligible for participation in the
         Plan for such Plan Year.

     4.  "Payment Date" shall be the date set by
         the Committee for payment of awards, other than
         those awards deferred pursuant to Section IX of
         the Plan and Section VII of these Rules and
         Regulations.

     5.  The "Plan" shall refer to the Executive
         Incentive Compensation Plan.

     6.  The "Plan Year" shall be the calendar year.

     7.  "Change in Control" shall mean the earlier
         of the following to occur:  (a) the public
         announcement by the Company or by any person
         (which shall not include the Company, any
         subsidiary of the Company or any employee
         benefit plan of the Company or of any
         subsidiary of the Company) ("Person") that such
         Person, who or which, together with all
         Affiliates and Associates (within the meanings
         ascribed to such terms in Rule 12b-2 of the
         General Rules and Regulations under the
         Securities Exchange Act of 1934, as amended
         (17 C.F.R. 240.12b-2)) of such Person, shall be
         the beneficial owner of twenty percent (20%) or
         more of the voting stock then outstanding; (b)
         the commencement of, or after the first public
         announcement of any Person to commence, a
         tender or exchange offer the consummation of
         which would result in any Person becoming the
         beneficial owner of voting stock aggregating
         thirty percent (30%) or more of the then
         outstanding voting stock; (c) the announcement
         of any transaction relating to the Company
         required to be described pursuant to the
         requirements of Item 6(e) of Schedule 14A of
         Regulation 14A of the Securities and Exchange
         Commission under the Securities Exchange Act of
         1934 (17 C.F.R. 240.14a-101, item 6(e)); (d) a
         proposed change in the constituency of the
         Board of Directors of the Company such that,
         during any period of two (2) consecutive years,
         individuals who at the beginning of such period
         constitute the Board of Directors of the
         Company cease for any reason to constitute at
         least a majority thereof, unless the election
         or nomination for election by the shareholders
         of the Company of each new Director was
         approved by a vote of at least two-thirds (2/3)
         of the directors then still in office who were
         members of the Board of Directors of the
         Company at the beginning of the period; or (e)
         any other event which shall be deemed by a
         majority of the Compensation Committee of the
         Board of Directors of the Company to constitute
         a "Change in Control."

     8.  The "Prime Rate" shall be the base rate on
         corporate loans posted by at least 75 percent
         of the nation's 30 largest banks as reported
         daily in The Wall Street Journal.

     9.  "Retirement" means the later of the day
         the Participant attains age 55 or the day the
         Participant ceases to be an employee of the
         Company, its utility division or any of its
         subsidiary corporations.

 II. ADMINISTRATION

     1.  The Committee shall have the full power to
         construe and interpret the Plan and to
         establish and to amend these Rules and
         Regulations for its administration.

     2.  No member of the Committee shall
         participate in a decision as to their own
         eligibility for, or award of, an incentive
         award payment.

     3.  Prior to the beginning of each Plan Year,
         the Committee shall approve a list of eligible
         executives and notify those so approved that
         they are eligible to participate in the Plan
         for such Plan Year.

     4.  Prior to the beginning of each Plan Year,
         the Committee and shall approve an Annual
         Operating Plan.  The Annual Operating Plan
         shall include the Plan's performance measures
         and target incentive award levels for each
         salary grade covered by the Plan for the
         following Plan Year.  The Plan's performance
         targets for the year shall be approved by the
         Committee no later than its regularly scheduled
         February meeting during the Plan Year.  The
         Annual Operating Plan, insofar as it is
         relevant to each individual Participant, shall
         be made available by the Committee to each
         Participant in the Plan at the beginning of
         each Plan Year.

     5.  The Committee shall have final discretion
         to determine actual award payment levels,
         method of payment, and whether or not payments
         shall be made for any Plan Year.  However,
         unless the Plan's performance objectives are
         met for the Plan Year, no award shall be made
         for that Plan Year.  Performance targets
         modified pursuant to Section II of the Plan
         will be deemed performance targets for purposes
         of determining whether or not these targets
         have been met.

III. PLAN PERFORMANCE MEASURES

     1.  The Committee shall establish the
         percentage attainment of corporate performance
         measure and the percentage attainment of
         individual goals measure.  The Committee may
         establish more or fewer performance measures
         as it deems necessary.

     2.  The corporate performance measure may be
         set by reference to earnings, return on
         invested capital or any other measure or
         combination of measures deemed appropriate by
         the Committee.  It may be established for the
         Company or for the individual business unit.

     3.  Individual performance will be assessed
         based on the achievement of annually
         established individual objectives.

     4.  Plan performance measures may be applied
         at the corporate level for individuals such as
         the Chief Executive Officer whose major or
         sole impact is Company-wide, or at the
         business unit level for individuals whose
         major or sole impact is on the business unit
         results.  The Annual Operating Plan shall
         contain a list of individuals to whom the Plan
         performance measures will be applied at the
         corporate level and a list of those
         individuals for whom the Plan performance
         measures will be applied at the business unit
         level.  The relevant business unit for each
         individual will be identified.

     5.  The Committee shall set threshold, target
         and maximum award levels for the performance
         measures, for each business unit, and for the
         Company.  Those levels shall be included in
         the Annual Operating Plan.

     6.  The Committee will retain the authority
         to determine whether or not the actual
         attainment of these measures has been made.

 IV. TARGET INCENTIVE AWARDS

     1.  Target incentive awards will be a
         percentage of each Participant's Salary, as
         defined in the Plan.

     2.  Target incentive awards shall be set by
         the Committee annually and will be included in
         the Annual Operating Plan.

  V. INCENTIVE FUND DETERMINATION

     1.  The target incentive fund is the sum of
         the individual target incentive awards for all
         eligible Participants.

     2.  The actual incentive fund will be
         determined by the Committee, based on actual
         performance as compared with the approved
         performance measures.

     3.  As soon as practicable following the close
         of each Plan Year, the Chief Executive Officer
         will provide the Committee with an analysis
         showing the Company's and each relevant
         business unit's performance in relation to both
         of the performance measures.  The Committee
         will review the analysis and determine, in its
         sole discretion, the amount of the actual
         incentive fund.

     4.  In determining the actual incentive fund,
         the Committee may consider any recommendations
         of the Chief Executive Officer.

 VI. INDIVIDUAL AWARD DETERMINATION

     1.  The Committee shall have the sole
         discretion to determine each individual
         Participant's award. The Committee's decision
         will be based first upon the level of performance
         achieved by the Company or business unit and
         second upon the individual's performance.

     2.  The Committee, after consultation with the
         Chief Executive Officer, shall set the award as
         a percentage from 0 percent to 200 percent of
         the Participant's target incentive award,
         adjusted for Company or business unit
         performance.

VII. PAYMENT OF AWARDS

     1.  On the date the Committee determines the
         awards to be made to individual Participants,
         it shall also establish the Payment Date.

     2.  Except as provided below or as the
         Committee otherwise determines, in order to
         receive an award under the Plan, a Participant
         must remain in the employment of the Company
         for the entire Plan Year and be an employee on
         the Payment Date.

     3.  If employment is terminated prior to
         Payment Date as a result of death, disability
         or retirement, or due to special circumstances
         as determined by the Committee in its sole
         discretion, payment may be made after
         termination.

     4.  If a Participant terminates employment
         with the Company pursuant to Section 5.01 of
         the Company's Bylaws which provides for
         mandatory retirement for certain officers on
         their 65th birthday (or terminates employment
         with a subsidiary of the Company pursuant to a
         similar subsidiary Bylaw provision) and if the
         Participant's 65th birthday occurs during the
         Plan Year, determination of whether the
         performance measures have been met will be made
         at the end of the Plan Year, and to the extent
         met, payment of the award will be made to the
         Participant, prorated.  Proration of awards
         shall be based upon the number of full months
         elapsed from and including January to and
         including the month in which the Participant's
         65th birthday occurs.

     5.  Payment of the awards shall be made in
         cash.  Payments shall be made on the Payment
         Date unless the Participant has deferred, in
         whole or in part, the receipt of the award by
         making an election on the deferral form
         attached hereto, prior to the end of the Plan
         Year immediately preceding the Payment Date.

     6.  In the event a Participant has elected to
         defer receipt of all or a portion of the award,
         the Company shall set up an account in their
         name. The amount of their award to the extent
         deferred will be credited to the Participant's
         account on the Payment Date.

     7.  The balance credited to an account of a
         Participant who has elected to defer receipt of
         an award will be an unsecured, unfunded
         obligation of the Company.

     8.  Interest shall accrue on the balance
         credited to a Participant's account.  The rate
         of interest shall be the Prime Rate plus
         1 percentage point as reported on the last
         Friday in January of each year.  Interest on
         the balance in an account shall accrue at the
         rate so determined from the Payment Date
         immediately following the determination to the
         Payment Date of the following year.

     9.  Interest shall be credited to the account
         on the day preceding Payment Date and shall be
         calculated on the balance in the Participant's
         account as of that date.

    10.  A Participant may elect to defer any
         percentage, not to exceed l00, of an annual
         award.

    11.  A Participant electing to defer any part of an
         award must elect one of the following dates for
         payment:

         (1)  Payment Date next following
              termination of employment with the
              Company or an affiliated company; or

         (2)  Payment Date of the fifth
              year following the year in which the
              award may be made.

    12.  A Participant may elect to receive the deferred
         amounts accumulated in the Participant's
         account in monthly installments, not to exceed
         120.  In the event the Participant elects to
         receive the amounts in the Participant's
         account in more than one installment, interest
         shall continue to accrue on the balance
         remaining in their account at the applicable
         rate or rates determined annually by the
         Committee.

    13.  In the event of the death of a Participant in
         whose name a deferred account has been set up,
         the Company shall, within six months
         thereafter, pay to the Participant's estate or
         the designated beneficiary the entire amount in
         the deferred account.

    14.  In the event of a "Change in Control" then any
         award deferred by each Participant shall become
         immediately payable to the Participant.  In the
         event the Participant files suit to collect a
         deferred award then all of the Participant's
         court costs, other expenses of litigation, and
         attorneys' fees shall be paid by the Company in
         the event the Participant prevails upon any of
         the Participant's claims for payment.AGREEMENT ON RETIREMENT

     This Agreement on Retirement (this "Agreement") is entered
into by and between Lester H. Loble II, Executive Vice President,
General Counsel and Secretary of MDU Resources Group, Inc., and
as a Director and/or Vice President, General Counsel and/or
Secretary of subsidiaries, divisions, affiliates, and limited
liability companies of MDU Resources Group, Inc. and as a member
and the Secretary of the Managing Committees of Montana-Dakota
Utilities Co. and Great Plains Natural Gas Co., divisions of MDU
Resources Group, Inc., and any other currently held positions
within the Companies ("Lester H. Loble, II") and MDU Resources
Group, Inc., a Delaware corporation, including all of its
subsidiaries, divisions, affiliates, limited liability companies,
partnerships, both foreign and domestic, successors and assigns
of MDU Resources Group, Inc. ("Companies").

                            Recitals

     A.   Lester H. Loble, II is retiring from Companies and the
parties wish to set forth certain terms on the severance of their
relationship.

     B.   The parties also wish to resolve any claim, demand,
liability, action, or cause of action whatsoever by Lester H.
Loble, II against the Companies and all other existing
differences completely and amicably.  Lester H. Loble, II
acknowledges that the mutual covenants and agreements herein,
including payments set forth in Paragraphs 2 and 3, are good and
adequate consideration for this Agreement.

     C.   The parties represent that they have been advised about
this Agreement by their respective counsel, are competent to
enter into it, fully understand its terms and consequences, and
enter into it knowingly and voluntarily.

     Based on these recitals, the parties agree as follows:

                              Terms

     1.   Retirement.  Lester H. Loble, II shall retire from all
positions, memberships and/or contracts held within Companies and
his employment with MDU Resources Group, Inc. shall terminate
effective at the close of business on January 2, 2004.  Except as
otherwise provided in this Agreement, all benefits, rights,
authority and privileges of Lester H. Loble from Companies end as
of the close of business on January 2, 2004, including but not
limited to any ability to obligate Companies pursuant to any
Power of Attorney or agreements not specified herein.

     2.   Benefits.  Lester H. Loble, II shall receive payment of
benefits which he has earned or accrued in accordance with MDU
Resources Group, Inc. plans and the award agreements thereunder
as applicable per his retirement date.  Lester H. Loble, II has
been informed in writing of those and concurs with the Companies'
determination of his benefits to be paid.

     a.   All payments and benefits to or for Lester H. Loble, II
contained in this paragraph shall be payable by Companies in the
ordinary course of its business, but such obligations will be
paid and/or performed within all time frames contained in the
various Companies compensation plans which may be applicable to a
retiring employee.  Lester H. Loble, II has received payment for
all accrued vacation in his January 23, 2004 payroll check.

     b.   It is further agreed that Lester H. Loble, II may take
the laptop computer, the palm pilot, and a small portable printer
used by Lester H. Loble, II, which items shall become the
property of Lester H. Loble, II.

     3.   Consulting Services.  Lester H. Loble, II, as an
independent contractor without eligibility for employee benefits,
agrees to provide consulting services for Companies for a period
of six months, unless terminated earlier by Companies, following
Lester H. Loble, II's retirement.  Duties to be performed by
Lester H. Loble, II shall be those assigned by Companies' Chief
Executive Officer.  Lester H. Loble, II will be paid one hundred
forty two thousand five hundred dollars ($142,500), payable in a
lump sum three (3) days after the expiration of the time for
revocation of acceptance of this Agreement as specified in
Paragraph 20 in consideration of this Agreement and these
services.  Lester H. Loble, II will be reimbursed for any
reasonable travel and other expenses necessary to perform these
services pursuant to Companies' then current policies and
procedures.

     4.   Tax.  Appropriate tax deductions will be made by
Companies from the payments made under Paragraphs 2 and 3.  The
Companies will withhold applicable federal and state income taxes
and Lester H. Loble, II's share of state and federal payroll
taxes on the gross amounts allocated to pay in Paragraphs 2 and 3
and provide Lester H. Loble, II with a W-2 or other appropriate
form evidencing such amounts.

     5.   Release.

     a.   Lester H. Loble, II, in exchange for the payment and
other considerations set forth above, the sufficiency of which
is hereby acknowledged and which is acknowledged to provide good
consideration to Lester H. Loble, II to which he is not entitled
unless he signs this Agreement, on behalf of himself and his
representatives, spouse, agents, heirs and assigns, releases and
discharges Companies and Companies' former, current or future
officers, employees, representatives, agents, fiduciaries,
attorneys, directors, shareholders, insurers, predecessors,
parents, affiliates, benefit plans, successors, heirs, and
assigns from any and all claims, liabilities, causes of action,
damages, losses, demands or obligations of every kind and nature,
whether now known or unknown, suspected or unsuspected, which
Lester H. Loble, II ever had, now has, or hereafter can, shall or
may have for, upon or by reason of any act, transaction,
practice, conduct, matter, cause or thing of any kind whatsoever
relating to or based upon, in whole or in part, any act,
transaction, practice or conduct prior to the date hereof,
including, but not limited to, matters dealing with Lester H.
Loble, II's employment or retirement from employment and/or any
other status with the Companies, or which relate in any way to
injuries or damages suffered by Lester H. Loble, II (knowingly or
unknowingly).  This Agreement does not eliminate or release any
coverages which Lester H. Loble, II may have under applicable
directors and officers insurance or his right to indemnification
under the terms of the Companies' bylaws for his time in office.
This release and discharge includes, but is not limited to,
claims arising under federal, state and local statutory or common
law, including, but not limited to, the federal Age
Discrimination in Employment Act ("ADEA"), Title VII of the Civil
Rights Act of 1964, the North Dakota Human Rights Act, the Fair
Labor Standards Act, the Family and Medical Leave Act of 1993,
the Americans with Disabilities Act, the Employee Retirement
Income Security Act, the North Dakota Whistleblower Act (codified
at N.D.C.C. Section 34-01-20), and the Sarbanes-Oxley Act of 2002,
including any and all claims for wrongful discharge under any
public policy or any policy of the Companies, claims for breach
of fiduciary duty, and the laws of contract and tort, and any
claim for attorney's fees or costs.

     b.  Lester H. Loble, II agrees that he has not and will not
institute any lawsuit or commence any action asserting any
claims, losses, liabilities, demands or obligations released
hereunder.  Nothing in this provision shall be construed,
however, as prohibiting Lester H. Loble, II from filing a charge
or complaint to test the validity under the Older Workers Benefit
Protection Act or the waiver of Lester H. Loble, II's rights
under the federal ADEA.  Nothing contained herein shall be
construed to prohibit Lester H. Loble, II from filing a charge or
complaint with the Equal Employment Opportunity Commission or the
North Dakota Department of Labor or participating in
investigations by those entities.  However, except for testing
the validity of the waiver noted above, Lester H. Loble, II
acknowledges that the release he executes herein waives his right
to file a court action or to seek individual remedies or monetary
damages in any EEOC or North Dakota Department of Labor filed
court action.  This release does not extend to rights, remedies,
claims or causes of action arising out of acts governed by
Paragraph 5.a., above, occurring after the effective date of this
Agreement and expiration of the revocation period.

     This Agreement does not apply to, or otherwise impair, any
vested right Lester H. Loble, II has under a presently existing
employee pension or benefit plan or any other claim that may not
be waived by law.

     6.   Known or Unknown Claims.  Lester H. Loble, II
understands and expressly agrees that this Agreement extends to
all claims of every nature and kind, known or unknown, suspected
or unsuspected, past, present, or future, arising from or
attributable to any conduct of the Companies and their
successors, subsidiaries, and affiliates, and all their
employees, owners, shareholders, agents, officers, directors,
predecessors, assigns, agents, representatives, and attorneys,
whether known by Lester H. Loble, II or whether or not Lester H.
Loble, II believes he may have any claims, and that any and all
rights granted to Lester H. Loble, II under N.D.C.C. Section 9-13-02 or
any analogous state law or federal law or regulations, are hereby
expressly WAIVED, if applicable.

     7.   No Admission.  Neither this Agreement nor any action or
acts taken in connection with this Agreement or pursuant to it
will constitute an admission by Lester H. Loble, II or by
Companies of any violation of law, nor will it constitute or be
construed as an admission of any wrongdoing whatsoever.

     8.   Nondisclosure of Proprietary and Trade Secret Business
Information.  Lester H. Loble, II agrees to retain in strict
confidence and not to use in any way and not to disclose to any
persons any non-public, confidential, proprietary, or trade
secret information of Companies as described in the North Dakota
Uniform Trade Secret Act.  Lester H. Loble, II further
acknowledges that he has returned to Companies all documents and
information encompassing non-public, confidential, proprietary,
or trade secret information of the Companies.  Lester H. Loble,
II acknowledges that prior to January 2, 2004, he will have
returned company property in his possession that was used in any
currently held positions within Companies, except for that
property which is listed in Paragraph 2.b.

     9.   No Disparagement.  The parties agree not to make any
disparaging or false statements about each other.

     10.  Change of Control Employment Agreement.  Lester H.
Loble, II and MDU Resources Group Inc. are parties to a Change of
Control Employment Agreement dated November 1, 1998.  Lester H.
Loble, II acknowledges that no "Change of Control" has occurred,
as that term is defined in that agreement and that agreement is
hereby terminated.

     11.  Agreement Regarding No Right to Future Employment.
Lester H. Loble, II's provision of consulting services will end
on June 30, 2004, unless that consulting relationship is
terminated earlier by Companies.  Lester H. Loble, II agrees that
he will not at any time in the future bring a claim against
Companies for any failure to offer him future employment or
failure to accept from him an application for future employment
with Companies.

     12.  Further Documents.  Each party agrees to execute or
cause their counsel to execute any additional documents and take
any further action which may reasonably be required in order to
consummate this Agreement or otherwise fulfill the obligations of
the parties thereunder.

     13.  Choice of Law.  This Agreement shall be construed and
enforced in accordance with the laws of the State of North
Dakota.

     14.  Attorneys' Fees.  Should any action be brought by any
party to this Agreement to enforce any provision thereof, the
prevailing party shall be entitled to recover, in addition to any
other relief, reasonable attorneys' fees and costs and expenses
of litigation or arbitration.  This provision shall not apply to
charges or complaints filed by Lester H. Loble, II to test the
validity under the Older Workers Benefit Protection Act or the
waiver of Lester H. Loble, II's rights under the ADEA.

     15.  Integration.  This Agreement constitutes an integration
of the entire understanding and agreement of the parties with
respect to the matters referred to in this Agreement.  Any
representation, warranty, promise or condition, whether written
or oral, between the parties with respect to the matters referred
to in this Agreement which is not specifically incorporated in
this Agreement shall not be binding upon any of the parties
hereto and the parties acknowledge that they have not relied, in
entering into this Agreement, upon any representations,
warranties, promises or conditions not specifically set forth in
this Agreement.  No prior or contemporaneous oral or written
understanding, covenant, or agreement between the parties, with
respect to the matters referred to in this Agreement, shall
survive the execution of this Agreement.  This Agreement may be
modified only by a written agreement executed by both parties
hereto.

     16.  Binding Agreement.  The parties understand and
expressly agree that this Agreement shall bind the heirs,
subsidiaries, affiliates, successors, and assigns of the
Companies and Lester H. Loble, II.

     17.  Construction.  The language of this Agreement shall be
construed as to its fair meaning and not strictly for or against
either party.  If any part of this Agreement is construed to be a
violation of law, such part shall be modified to achieve the
objective of the parties to the fullest extent permitted and the
balance of this Agreement shall remain in full force and effect.

     18.  Counterparts.  This Agreement may be executed in
counterparts and when each party has signed and delivered at
least one such counterpart, each counterpart shall be deemed an
original and all counterparts taken together shall constitute one
and the same Agreement, which shall be binding and effective as
to all parties.

     19.  Headings.  Headings in this Agreement are for
convenience of reference only and are not a part of the substance
hereof.

     20.  Time for Acceptance and Revocation.  Lester H. Loble,
II acknowledges that he has been advised in writing by Companies
to consult with an attorney prior to signing it.  Lester H.
Loble, II may have up to twenty-one (21) days from the date this
Agreement is presented to Lester H. Loble, II to accept the terms
of this Agreement, although Lester H. Loble, II may accept it at
any time within those twenty-one (21) days.  Lester H. Loble, II
agrees that any changes to this Agreement, whether material or
not, will not restart the period for acceptance.  After
acceptance, Lester H. Loble, II will still have an additional
seven (7) days in which to revoke his acceptance as it relates to
federal age discrimination claims and reinstate any potential
claims he might have under the ADEA.  To so revoke, Lester H.
Loble, II must send the Companies a written statement of
revocation.  To be effective, the revocation must be in writing
and hand-delivered or mailed to the Companies addressed as
follows:  MDU Resources Group, Inc., c/o Chief Executive Officer,
P.O. Box 5650, Bismarck, ND  58506-5650, within the seven (7) day
period.  If mailed, the revocation must be postmarked within the
seven (7) day period.

     This Agreement will not be effective and no payment will be
made hereunder until the revocation period has expired.  If
Lester H. Loble, II exercises his option to revoke his ADEA
waiver, the entire Agreement is voidable at the Companies' option
within seven (7) days and neither Lester H. Loble, II nor the
Companies shall have any further rights or obligations pursuant
to this Agreement.

     21.  Severability.  Should any court with jurisdiction
determine that any provision of this Agreement is invalid, void
or unenforceable, the remaining provisions shall remain in full
force and effect.

                                   EMPLOYEE

Dated:  February 2, 2004           /s/ LESTER H. LOBLE, II
                                   Lester H. Loble, II

Dated:  January 29, 2004           FOR THE COMPANIES

                                   /s/ MARTIN A. WHITE
                                   Martin A. White
                                   Chairman of the Board,
                                   President and Chief Executive Officer
                                   MDU Resources Group, Inc.

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