EMPLOYMENT AGREEMENT





     THIS EMPLOYMENT AGREEMENT (the "Agreement") entered into as of August 20,

2002, by and between Northeast Utilities ("Northeast Utilities" or "NU"), a

Massachusetts business trust (together with its successors and assigns

permitted under the Agreement and each direct and indirect affiliated company

that shall adopt this Agreement pursuant to Section 18 hereof, the "Company"),

with its principal office in West Springfield, Massachusetts, and its general

office in Berlin, Connecticut, and Michael G. Morris, a resident of Northville,

Michigan ("Executive").



     WHEREAS, both parties desire to enter into an agreement to reflect

Executive's executive capacities in the Company's business and to provide for

Executive's continued employment by the Company, upon the terms and conditions

set forth herein:



     NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby

agree as follows:



     1.   Employment.  The Company hereby agrees to employ Executive, and

Executive hereby accepts such employment and agrees to perform Executive's

duties and responsibilities, in accordance with the terms, conditions and

provisions hereinafter set forth.



     1.1. Employment Term.  The term of Executive's employment under this

Agreement shall commence as of the date hereof (the "Effective Date") and shall

continue until August 20, 2007, unless sooner terminated in accordance with

Section 5 or Section 6 hereof, and shall automatically renew for periods of one

year unless one party gives written notice to the other, at least six months

prior to August 20, 2007 or at least six months prior to the end of any

one-year renewal period, that the Agreement shall not be further extended.

The period commencing as of the Effective Date and ending on the date on which

the term of Executive's employment under the Agreement shall terminate is

hereinafter referred to as the "Employment Term."



     1.2. Duties and Responsibilities.  Executive shall serve as Chairman,

President and Chief Executive Officer of Northeast Utilities and in such other

senior positions, if any, to which he may be elected during the Employment

Term.  During the Employment Term, Executive shall perform all duties and

accept all responsibilities incident to such positions as may be assigned to

him by the Northeast Utilities' Board of Trustees (the "Trustees").



     1.3. Extent of Service.  During the Employment Term, Executive agrees to

use Executive's best efforts to carry out Executive's duties and

responsibilities under Section 1.2 hereof and, consistent with the other

provisions of this Agreement, to devote substantially all Executive's business

time, attention and energy thereto.  Except as provided in Section 3 hereof,

the foregoing shall not be construed as preventing Executive from making

minority investments in other businesses or enterprises provided that Executive

agrees not to become engaged in any other business activity which, in the

reasonable judgment of the Trustees, is likely to interfere with Executive's

ability to discharge Executive's duties and responsibilities to the Company.



     1.4. Base Salary.  For all the services rendered by Executive hereunder,

the Company shall pay Executive a base salary ("Base Salary"), commencing on

the Effective Date, at the annual rate of $950,000, payable in installments

at such times as the Company customarily pays its other senior level executives

(but in any event no less often than monthly).  Executive's Base Salary shall

be reviewed annually for appropriate adjustment (but shall not be reduced below

that in effect on the Effective Date without Executive's written consent) by

the Trustees pursuant to its normal performance review policies for senior

level executives.



     1.5. Retirement and Benefit Coverages.



          (a)  During the Employment Term, Executive shall be entitled to

participate in all (a) employee pension and retirement plans and programs

("Retirement Plans") and (b) welfare benefit plans and programs ("Benefit

Coverages"), in each case made available to the Company's senior level

executives as a group or to its employees generally, as such Retirement

Plans or Benefit Coverages may be in effect from time to time, but not the

Company's Supplemental Executive Retirement Plan for Officers (the

"Supplemental Plan").  Executive shall also be covered by an individual term

life insurance policy in the face amount of $2,700,000.



          (b)  In lieu of coverage under the Supplemental Plan, Executive shall

also be entitled to receive a special retirement benefit (the "Special

Retirement Benefit") equal to the excess of (i) the annual benefit payable at

normal or early retirement, as applicable, under the benefit formula (including

any actuarial subsidy for early retirement) of the Gross Supplemental Benefit

Plan, as set forth in Appendix A to this Agreement, over (ii) the retirement

benefit actually due to Executive, at his normal or early retirement date,

as applicable, under the Northeast Utilities Service Company Retirement Plan

(the "Retirement Plan of the Company").  Appendix A also governs the time and

form of payment of the Special Retirement Benefit.  In the event of Executive's

death prior to retirement and without regard to the length of the Employment

Term, a survivor benefit (the "Survivor Benefit") shall be paid as follows:

a Survivor Benefit shall be paid to Executive's surviving spouse, if any,

equal to the excess of (i) the survivor benefit that would be calculated

for such spouse under the Supplemental Plan if (x) Executive's Special

Retirement Benefit, as calculated above, had been a vested "Target Benefit"

(the "Target Benefit") under the Supplemental Plan and (y) Executive's

surviving spouse had been entitled to a pre-retirement death benefit with

respect to that Target Benefit under the Supplemental Plan over (ii) the

survivor benefit actually due to such spouse under the Retirement Plan of

the Company.



          (c)  Notwithstanding the foregoing, if at the end of the Employment

Term Executive is at least age 60, Executive will be entitled to a retirement

benefit, in lieu of the Special Retirement Benefit, which is equal to the

benefit that Executive would have been entitled to receive had he been eligible

for a Make-Whole Benefit and a Target Benefit under the Supplemental Plan,

based on all of the Accredited Service (as defined in Appendix A) used in

determining the Special Retirement Benefit (such benefit to be referred to

herein as the "Modified Special Retirement Benefit");  provided, however, that

the Modified Special Retirement Benefit shall only be substituted for the

Special Retirement Benefit if it will produce a greater benefit on an actuarial

basis (determined by using the definition of "Actuarially Equivalent" in the

Retirement Plan of the Company and including survivor benefits in such

determination) than the Special Retirement Benefit.  If at the end of the

Employment Term Executive has not yet attained age 60, the Trustees (or a

Committee thereof) retain the right to award Executive the Modified Special

Retirement Benefit provided pursuant to this Section 1.5 (c) in their sole

discretion.



     1.6. Reimbursement of Expenses and Dues; Vacation.  Executive shall be

provided with reimbursement of expenses related to Executive's employment by

the Company on a basis no less favorable than that which may be authorized from

time to time for senior level executives as a group, and shall be entitled to

five weeks of vacation annually and holidays in accordance with the Company's

normal personnel policies for senior level executives.  In addition, Executive

shall be entitled to (i) the annual dues of a luncheon club in Hartford,

Connecticut and (ii) the use of an automobile including all operating and

maintenance expenses, both to be used primarily in pursuit of the business of

the Company.



     1.7  Short-Term Incentive Compensation.  Executive shall be entitled to

participate in any short-term incentive compensation programs established by

the Company for its senior level executives generally, depending upon

achievement of certain annual individual or business performance objectives

specified and approved by the Trustees (or a Committee thereof) in its sole

discretion; provided, however, that Executive's "target opportunity" and

"maximum opportunity" under any such program shall be at least 150% and 300%

respectively of Executive's Base Salary, except that the Trustees may change

these "target opportunity" and "maximum opportunity" percentages as part of a

general revision of executive compensation which also applies to other senior

level executives of the Company.  Executive's short- term incentive

compensation, either in shares of NU or cash, as applicable from time to time,

shall be paid to Executive, subject to the Trustees' reasonable discretion,

not later than such payments are made to the Company's senior level executives

generally.



     1.8  Long-Term Incentive Compensation.  Executive shall also be entitled

to participate in any long-term incentive compensation programs established by

the Company for its senior level executives generally, depending upon

achievement of certain business performance objectives specified and approved

by the Trustees (or a Committee thereof) in its sole discretion; provided,

however, that Executive's "target opportunity" and "maximum opportunity" under

any such program shall be at least 220% and 440% respectively of Executive's

Base Salary, except that the Trustees may change these "target opportunity" and

"maximum opportunity" percentages as part of a general revision of executive

compensation which also applies to other senior level executives of the

Company.  Executive's long-term incentive compensation, either in shares of NU,

restricted stock units, options or cash, as applicable from time to time, shall

be paid to Executive, subject to the Trustees' reasonable discretion, not

later than such payments are made to the Company's senior level executives

generally.



     1.9  Relocation of Residence.  In the event Executive decides to relocate

his principal residence to Connecticut from Northville, Michigan, the Company

shall purchase Executive's residence in Northville, Michigan and Executive's

vacation home in Green Oak Township, Michigan (if Executive is unable to sell

either or both such properties, in each case within 90 days of placing such

property on the market) for fair market value as determined in accordance with

the Company's normal policy for senior level executives.



     1.10 Stock Option Grant.  On November 1, 2002, or as soon as practicable

thereafter, Executive shall be granted, in addition to any stock options

heretofore granted, a nonqualified stock option (for a term expiring August 20,

2012 or, if earlier, three years after the date of Executive's termination

from employment by the Company for any reason other than cause, as defined in

Section 5.3, in which case the term shall expire immediately and be forfeited)

to purchase 500,000 shares of common stock of NU at a purchase price of $16.55

for each share purchased (the "Special Option").  Executive's right to exercise

the Special Option shall vest on August 20, 2007, but only if, on such date,

Executive is still employed as Chief Executive Officer.  In the event, prior

to August 20, 2007, of Executive's death, Executive's involuntary termination

without cause pursuant to Section 5.4(b), or termination following the

occurrence of a Change of Control pursuant to Section 6.1(f), Executive will be

immediately vested in the right to purchase shares equal to a percentage of

500,000 shares which is 20% multiplied by the number of anniversaries of

the Effective Date which have occurred on or prior to such event.  Except as

provided in the preceding two sentences, the right to exercise the Special

Option shall be forfeited upon termination of employment.  The terms of the

Special Option, to the extent not inconsistent with the provisions outlined

in this Section, shall be made subject to the terms of the Northeast Utilities

Incentive Plan.



     2.   Confidential Information.  Executive recognizes and acknowledges

that by reason of Executive's employment by and service to the Company during

and, if applicable, after the Employment Term Executive will continue to have

access to certain confidential and proprietary information relating to the

business of the Company, which may include, but is not limited to, trade

secrets, trade "know-how", customer information, supplier information, cost and

pricing information, marketing and sales techniques, strategies and programs,

computer programs and software and financial information (collectively referred

to as "Confidential Information").  Executive acknowledges that such

Confidential Information is a valuable and unique asset of the Company and

Executive covenants that Executive will not, unless expressly authorized in

writing by the Trustees, at any time during the course of Executive's

employment use any Confidential Information or divulge or disclose any

Confidential Information to any person, firm or corporation except in

connection with the performance of Executive's duties for the Company and in

a manner consistent with the Company's policies regarding Confidential

Information.  Executive also covenants that at any time after the termination

of such employment, directly or indirectly, Executive will not use any

Confidential Information or divulge or disclose any Confidential Information

to any person, firm or corporation, unless such information is in the public

domain through no fault of Executive or except when required to do so by a

court of law, by any governmental agency having supervisory authority over

the business of the Company or by any administrative or legislative body

(including a committee thereof) with apparent jurisdiction to order Executive

to divulge, disclose or make accessible such information, in which case

Executive will inform the Company in writing promptly of such required

disclosure, but in any event at least two business days prior to disclosure.

All written Confidential Information (including, without limitation, in any

computer or other electronic format) which comes into Executive's possession

during the course of Executive's employment shall remain the property of the

Company.  Except as required in the performance of Executive's duties for the

Company, or unless expressly authorized in writing by the Trustees, Executive

shall not remove any written Confidential Information from the Company's

premises, except in connection with the performance of Executive's duties for

the Company and in a manner consistent with the Company's policies regarding

Confidential Information.  Upon termination of Executive's employment,

Executive agrees immediately to return to the Company all written Confidential

Information in Executive's possession.  For the purposes of this Section 2, the

term "Company" shall be deemed to include the Affiliates, as defined in

Section 6.1(a), of the Company.



     3.   Non-Competition; Non-Solicitation.



          (a)  During Executive's employment by the Company and for a period

of two years after Executive's termination of employment for any reason, within

the Company's "Service Area," as defined below, Executive will not, except with

the prior written consent of the Trustees, directly or indirectly, own, manage,

operate, join, control, finance or participate in the ownership, management,

operation, control or financing of, or be connected as an officer, director,

employee, partner, principal, agent, representative, consultant or otherwise

with, or use or permit Executive's name to be used in connection with, any

business or enterprise which is engaged in any business that is competitive

with any regulated business or enterprise in which the Company is engaged

("Competitive Company").  For the purposes of this Section, "Service Area"

shall mean the geographic area within the states of Connecticut, Maine,

Massachusetts, New Hampshire, Rhode Island, and Vermont, or any other state

in which the Company, in the aggregate, generates 25% or more of its revenues

in the fiscal year of NU in which Executive's termination of employment occurs.

Further, for the purposes of this Section, "Competitive Company" shall mean

Consolidated Edison, Inc., Energy East Corporation, Hydro-Quebec, KeySpan

Energy, National Grid USA, NSTAR, or The United Illuminating Company, their

assigns or successors, or any other company which in the future engages in

competition with the regulated business of the Company in the Service Area.

Executive acknowledges that the listed Service Area is the area in which the

Company presently does business.



          (b)  The foregoing restrictions shall not be construed to prohibit

the ownership by Executive of less than five percent (5%) of any class of

securities of any corporation which is engaged in any of the foregoing

businesses having a class of securities registered pursuant to the Securities

Exchange Act of 1934 (the "Exchange Act"), provided that such ownership

represents a passive investment and that neither Executive nor any group of

persons including Executive in any way, either directly or indirectly, manages

or exercises control of any such corporation, guarantees any of its financial

obligations, otherwise takes any part in its business, other than exercising

Executive's rights as a shareholder, or seeks to do any of the foregoing.



          (c)  Executive further covenants and agrees that during Executive's

employment by the Company and for the period of two years thereafter, Executive

will not, directly or indirectly, (i) solicit, divert, take away, or attempt to

solicit, divert or take away, any of the Company's "Principal Customers,"

defined for the purposes hereof to include any customer of the Company, from

which $100,000 or more of annual gross revenues are derived at such time, or

(ii) encourage any Principal Customer to reduce its patronage of the Company.

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