Converted by EDGARwiz

pursuant to the Definitive Agreement.

"Bankrupt" shall mean with respect to a Person, if such Person or any of its Affiliates (a) files a petition or otherwise commences a Proceeding under any bankruptcy, insolvency, reorganization or similar Law, or has any such petition filed or commenced against it; (b) makes an assignment or any general arrangement (other than an assignment undertaken in connection with a financing) for the benefit of creditors; (c) otherwise becomes bankrupt or insolvent (however evidenced); (d) has a liquidator, administrator, receiver, bankruptcy trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets, provided that if such action is taken without the consent of such Person, then such Person shall be allowed twenty (20) days to dismiss such appointment; or (e) is generally unable to pay its debts as they fall due.

"Business Day" shall mean any day other than Saturday and Sunday and other than when the following holidays are celebrated: New Year's Day; Presidents' Day; Good Friday; Memorial Day; Independence Day; Labor Day; Columbus Day; Veterans Day; Thanksgiving Day; day after Thanksgiving; and Christmas Day.

"Calculation Period" shall mean the from time to time period over which Contractor calculates revenue requirements for regional rates. As of the Effective Date, the Calculation Period is the twelve-month period beginning [June 1] of a year and ending [May 31] of the following year.

"Capital Costs" shall have the meaning set forth in Section 4.3(a).

"Capital Improvement" shall mean any addition, improvement, upgrade and/or other modification to the Transmission Facilities, in whole or in part, the cost of which constitutes a capital expenditure.

"CEII" shall mean critical energy infrastructure information, as defined by FERC pursuant to 18 C.F.R. § 388.113(c)(1), or any successor designation of information having a similar effect.

"C.F.R." shall mean the Code of Federal Regulations of the United States of America.

"CIP" shall have the meaning set forth in Section 3.8.

"Claiming Party" shall have the meaning set forth in Section 7.1.

"Connecticut NEEWS Project" shall have the meaning set forth in the Definitive Agreement.

"Contractor" shall mean The Connecticut Light and Power Company and its successors and assigns.

"Contractor Facilities" shall mean collectively all electric transmission facilities (including towers, poles, conductors, conduits, substations and associated land and land rights) owned by Contractor.

"Contractor Representative" shall mean the representative of Contractor designated pursuant to Section 2.10.

"CONVEX" shall mean The Connecticut Valley Electric Exchange. CONVEX is a Local Control Center (as defined in the ISO-NE Tariff) and performs certain functions regarding the operation of the electric transmission system and dispatch of generation in the State of Connecticut and the Commonwealth of Massachusetts in accordance with the ISO-NE Tariff and the TOA.

"Cost Allocation" shall mean the charge for Services determined in accordance with Section 5.1.

"CPR" shall mean the CPR Institute for Dispute Resolution (formerly known as the Center for Public Resources).

"CPR Mediation Procedure" shall mean the procedures developed by CPR to facilitate the conduct of the mediation process.

"CPR Panels of Distinguished Neutrals" means a list of qualified mediators and arbitrators developed and maintained by CPR available to help resolve complex business disputes.

"CPR Rules for Non-Administered Arbitration" shall mean the rules developed by CPR to facilitate the conduct of the arbitration process.

"Credit Rating" means, with respect to any Person, the rating assigned to such Person by Moody's and S&P (or if only one such entity provides a rating, then Moody's or S&P) for such Person's senior unsecured, unsubordinated long-term debt obligations (not supported by third party credit enhancements) or, if such Person does not have a rating for its senior unsecured, unsubordinated long-term obligations, then the rating one notch below the rating then assigned to such Person as a corporate or long-term issuer rating. If a Person has a rating from Moody's and S&P and the ratings differ, the lower of the two Credit Ratings shall apply.

"Defaulting Party" shall have the meaning set forth in Section 8.2.

"Definitive Agreement" shall mean the Agreement Re: Connecticut NEEWS Projects dated [____________], 2010, by and between the Parties, including all of the exhibits and schedules thereto, as the same may be amended from time to time.

"Effective Date" shall have the meaning set forth in the preamble above.

"Environment" means soil, land surface or subsurface strata, real property, surface waters, groundwater, wetlands, sediments, drinking water supply, ambient air (including indoor air) and any other environmental medium or natural resource.

"Environmental Law" shall mean Law relating to: (a) the regulation, protection and use of the Environment; (b) the conservation, management, development, control and/or use of land, natural resources and wildlife; (c) the management, manufacture, possession, presence, use, generation, transportation, treatment, storage, disposal, release, threatened release, abatement, removal, remediation, or handling of, or exposure to, any Hazardous Materials, including all applicable common law pertaining to actions for personal injury and/or property damage resulting from Hazardous Materials with respect to both on-Site and off-Site contamination; or (d) noise.

"Environmental Liability" means any Liability (including enhanced oversight expenses) under or related to Environmental Law arising as a result of or in connection with (a) the construction, installation, ownership, use, operation and/or maintenance of all or any portion of any Transmission Facilities whether occurring prior to, on, or after the Effective Date; (b) the presence or Release of Hazardous Materials at, on, in, under, adjacent to or migrating from the location of any of the assets comprising all or any portion of any Transmission Facilities prior to, on or after the Effective Date; (c) the investigation and/or Remediation (whether or not such investigation or Remediation commenced before the Effective Date or commences on or after the Effective Date) of Hazardous Materials that are present or have been Released prior to, on or after the Effective Date at, on, in, under, adjacent to or migrating from the location of any of the assets comprising all or any portion of any Transmission Facilities; (d) the off-site disposal, treatment, storage, transportation, discharge, Release or recycling, or the arrangement for such activities, of Hazardous Materials, prior to, on or after the Effective Date, in connection with the construction, installation, ownership, use, operation and/or maintenance of all or any portion of any Transmission Facilities; and (e) the investigation and/or Remediation of Hazardous Materials that are generated, disposed, treated, stored, transported, discharged, Released, recycled, or the arrangement of such activities, prior to, on or after the Effective Date, in connection with the construction, installation, ownership, use, operation and/or maintenance of all or any portion of any Transmission Facilities at any Offsite Disposal Facility.

"Event of Default" shall have the meaning set forth in Section 8.2.

"FERC" shall mean the Federal Energy Regulatory Commission or any successor agency having jurisdiction over the Transmission Facilities.

"Force Majeure" shall have the meaning set forth in Section 7.1.

"Good Utility Practices" shall have the meaning set forth in the TOA from time to time.

"Governmental Authority" shall mean any federal, state, commonwealth, county,

local or other governmental, quasi-governmental, regulatory or administrative authority, agency, commission, department, board, or other governmental subdivision, legislature, rulemaking board, court, tribunal, arbitral body, government-owned corporation or other governmental authority or department thereof.

"Hazardous Materials" shall mean: (a) any petrochemical or petroleum products, oil, waste oil, asbestos in any form that is or could become friable, urea formaldehyde foam insulations, lead-based paint and polychlorinated biphenyls; (b) any products, mixtures, compounds, materials or wastes, air emissions, toxic substances, wastewater discharges or any chemical, material or substance that may give rise to Liability pursuant to, or is listed or regulated under, or the human exposure to which or the release of which is controlled or limited by Environmental Law; and (c) any materials or substances defined in Environmental Law as "hazardous", "toxic", "pollutant", or "contaminant", or defined in Environmental Law using any words of similar meaning or legal or regulatory effect.

"Indemnified Environmental Obligations" shall have the meaning set forth in Section 9.2.

"Indemnified Person" shall have the meaning set forth in Section 9.1.

"Initial Term" shall have the meaning set forth in Article 10.

"Investment Grade" shall mean Credit Ratings of at least BBB- by S&P and Baa3 by Moody's (or the equivalent of such ratings if either of such rating agencies has modified its rating scale).

"ISO-NE" shall mean ISO New England Inc. and any successor thereto as the independent system operator (including a regional transmission organization) for the regional transmission grid that includes the Transmission Facilities.

"ISO Tariff" shall mean the ISO-NE Transmission, Markets, and Services Tariff, FERC Electric Tariff No. 3.

"Law" shall mean any current and future applicable federal, state, local or other governmental or quasi-governmental constitution, charter, act, statute, law, ordinance, code, rule, regulation, order, decree, ruling, decision, judgment, license or Permit.

"Liability" or "Liabilities" shall mean any claim, loss, fee (including experts' and/or attorneys' fees), cost, damage, expense, fine, penalty, liability, demand, action, settlement, judgment, award or other obligation of whatever nature including cost and expense of claims management and litigation (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, whether incurred or consequential and whether due or to become due) including those arising as a result of any Proceeding and including any Environmental Liability.

"License Agreement" shall mean each and every License Agreement by and between the Parties executed and delivered pursuant to the Definitive Agreement.

"Managed Claim" shall have the meaning set forth in the Definitive Agreement.

"Moody's" means Moody's Investor Services, Inc.

"NERC" shall mean the North American Electric Reliability Corporation or any successor thereto to the extent affecting the operation and/or maintenance of the Transmission Facilities.

"NPCC" shall mean the Northeast Power Coordinating Council and any successor thereto.

"NUSCO" shall mean Northeast Utilities Service Company, a Connecticut corporation.

"O&M Assets" shall mean collectively Contractor Facilities and electric transmission facilities (including substations) owned by Persons other than Contractor and being maintained by Contractor (including through an operation and maintenance arrangement); excluding, however, the Transmission Facilities.

"O&M Costs" shall mean collectively all direct and indirect costs and expenses suffered and/or incurred by Contractor in connection with, and/or allocated by Contractor to, the operation and maintenance of Contractor Facilities. O&M Costs include:

(a)

all costs and expenses incurred in connection with such operation and/or maintenance;

(b)

all costs and expenses relating to planning, studies, engineering, permitting and/or supervision and management (before, during and after construction) of operation and maintenance;

(c)

all costs and expenses related to operation and maintenance of computer hardware and software and communications equipment serving the transmission function;

(d)

all costs and expenses for equipment, spare parts, materials, supplies, storage, security, fuel and other consumables;

(e)

the cost of services performed by subcontractors and any other Third Party expenses incurred in connection with such operation and/or maintenance (including vegetation management, environmental and permitting consultants, procurement, surveying and engineering services, testing, lobbyists, supplemental labor, and/or other work performed by Third Parties);

(f)

any and all fees, charges, expenses and other costs of whatever nature charged by any Third Party in connection with such operation and/or maintenance, including Taxes, rents, fees for Permits (including charges to review and issue such Permits), charges due to land owners (including railroads) and Governmental Authorities, and any other one-time and/or recurring costs imposed on the performance of such work;

(g)

non-Third Party expenses incurred by Contractor during the performance of such operation and/or maintenance, including direct labor costs and the costs of employee benefits, overhead allocations and other embedded costs of Contractor and its Affiliates (including corporate center service level agreement costs (such as legal, human resources, insurance and payroll), business support costs and expenses, vacations, holidays, and other non-productive time); and

(h)

loaders and overheads (including administrative and general charges).

"Offsite Disposal Facility" means a location, other than the location of any asset comprising all or any part of any Transmission Facilities, that receives or received Hazardous Materials for storage and/or disposal by or on behalf of Contractor prior to the Effective Date or by or on behalf of UI on or after the Effective Date.

"Operating Authority" shall mean that authority vested in ISO-NE pursuant to the TOA.

"Owner" shall mean UI and its permitted successors and assigns.

"Owner Representative" shall mean the representative of Owner designated pursuant to Section 3.9.

"Participating Transmission Owners" shall mean those transmission owners who have executed the TOA with ISO-NE with the consent and approval of ISO-NE.

"Party" shall mean either Contractor or Owner, and "Parties" shall mean both of them.

"Permits" shall mean collectively all approvals, authorizations, certificates, permits, agreements, orders, consent orders and licenses issued with respect to the ownership, installation, use, operation and/or maintenance of electric transmission facilities, including the Transmission Facilities, by any Governmental Authority.

"Person" shall mean a natural person, a corporation, a partnership, a limited liability company, a limited liability partnership, or any other entity.

"Planning Authority" shall mean ISO-NE and/or any other regional and/or national planning authority for electric transmission facilities, including any committees,

commissions and/or other organizations that make recommendations with respect to, and/or have a role in the approval of, the operation, maintenance, improvement and/or expansion of transmission facilities.

"Points of Demarcation" shall mean the interconnection points between the Transmission Facilities and the electrical transmission system not owned by Owner, as more particularly described in the Asset Demarcation Agreement.

"Proceeding" shall mean (a) any action, cause of action, and/or proceeding of whatever form including any writ, filing, complaint, hearing, lawsuit, litigation, mediation, arbitration, regulatory proceeding, investigation, petition for relief, appeal, injunction, declaratory action, and/or any process that has any effect similar to any of the foregoing; and (b) without limiting the generality of clause (a), any process that involves the enforcement and/or declaration of any right, benefit and/or entitlement, seeks the relief from, and/or imposition of, any Liability of whatever nature, and/or requests any decision, authorization and/or other action from a Person other than a Party, whether or not a Governmental Authority.

"Regulatory Proceeding" shall mean any Proceeding before and/or administered by any Governmental Authority (including FERC and ISO-NE) and/or NERC, including any federal and/or state legislative, regulatory and/or court Proceedings, and any resulting court Proceedings.

"Related Agreement" shall have the meaning set forth in Section 3.4(a).

"Release" means any actual, threatened or alleged spilling, leaking, pumping, pouring, emitting, dispersing, emptying, discharging, injecting, escaping, leaching, dumping, or disposing of any Hazardous Materials into the Environment that may cause an Environmental Liability (including the disposal or abandonment of barrels, containers, tanks or other receptacles containing or previously containing any Hazardous Materials).

"Remediation" means any or all of the following activities to the extent required to address the presence or Release of Hazardous Materials: (a) monitoring, investigation, assessment, treatment, cleanup, containment, removal, mitigation, response or restoration work as well as obtaining any permits, consents, approvals or authorizations of any Governmental Authority necessary to conduct any such activity; (b) preparing and implementing any plans or studies for any such activity; (c) obtaining a written notice (or an oral notice that is appropriately documented or memorialized) from a Governmental Authority with competent jurisdiction under Environmental Law or a written opinion of a Licensed Environmental Professional (as defined in Connecticut General Statutes § 22a-133v), as contemplated by the relevant Environmental Law and in lieu of a written notice from a Governmental Authority, that no material additional work is required; and (d) any other activities reasonably determined by a Party to be necessary or appropriate or required under Environmental Law.

"S&P" means Standard and Poor's Rating Group (a division of McGraw-Hill,

Inc.).

"Services" shall have the meaning set forth in Section 2.1(a).

"Site" shall mean those parcels of real property on which Owner possesses the right to locate the Transmission Facilities as identified in the License Agreement.

"Tax" or "Taxes" shall mean any federal, state, local, or foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental, customs duties, franchise, profits, withholding, real property, personal property, sales, use, transfer, conveyance, registration, value added, alternative or add-on minimum, estimated, or other tax, fees and other charges of any Governmental Authority of any kind whatsoever, including any interest, penalty, or addition thereto, whether disputed or not.

"Term" shall mean the term of this Agreement, as determined in accordance with Article 10 and includes the Initial Term.

"Third Party" shall mean any Person other than the Parties or any of their respective Affiliates.

"TOA" shall mean that certain Transmission Operating Agreement dated February 1, 2005, between ISO-NE and the Participating Transmission Owners (as amended from time to time) on file with FERC or any successor document thereto.

"Transmission Facilities" shall mean the electric transmission facilities conveyed to Owner pursuant to the Definitive Agreement, as the same may be replaced, improved and/or altered from time to time in accordance with the terms hereof.

"UI" shall have the meaning set forth in the preamble above.

"U.S.C." shall mean the United States Code.

1.2.

Entire Agreement; Interpretation.

(a)

Entire Agreement. This Agreement and the Transaction Documents (as defined in the Definitive Agreement) contain the entire agreement between the Parties pertaining to the operation and maintenance of the Transmission Facilities and the provision of the Services and supersede any and all prior oral or written agreements, terms, understandings, conditions, proposals, negotiations and representations with respect to that subject matter.

(b)

Amendments. No amendments or modifications of this Agreement shall be valid unless evidenced in writing, and signed and delivered by duly authorized officers or agents of Owner and Contractor.

(c)

No Third Party Beneficiaries. This Agreement and all rights hereunder are intended for the sole benefit of the Parties and shall not imply or create any rights on the part of, or obligations to, any other Person (other than the Indemnified Persons).

(d)

Documents Comprising the Agreement. The terms and conditions of this Agreement are complementary. Insofar as possible, all of such terms and conditions shall be construed and interpreted consistently. In any case of inconsistency, conflict or ambiguity between or among such terms and conditions (including any schedules and/or documents incorporated by reference), the order of precedence shall be as follows:

(i)

the body of this Agreement;

(ii)

the schedules to this Agreement; and

(iii)

all other documents.

In the event of any conflict or inconsistency between any provisions of separate schedules, such conflict or inconsistency shall be resolved in favor of the first such schedule and thereafter proceeding in descending order.

(e)

Scope. This Agreement shall not modify, limit or otherwise affect the rights and obligations of the Parties under the Definitive Agreement. In the event of any conflict or inconsistency between any provision of the Definitive Agreement and this Agreement, such conflict or inconsistency shall be resolved in favor of the provision of the Definitive Agreement.

(f)

References. Reference to a given article, section or schedule is reference to an article, section or schedule of this Agreement, unless otherwise specified. The terms "hereof", "herein", "hereto", "hereunder" and "herewith" refer to this Agreement as a whole.

(g)

Number. As used in this Agreement, all singular terms shall include the plural and vice versa as the context may require.

(h)

Interpretation. Except where otherwise expressly provided or unless the context otherwise necessarily requires in this Agreement: (i) reference to a given Law or tariff shall mean such Law or tariff in effect as amended or modified as of the Effective Date, or on the date on which the reference is made, or performance and/or compliance is required; (ii) reference to a given agreement or instrument is a reference to that agreement or instrument as originally executed, and as modified, amended, supplemented and restated through the date as of which reference is made to that agreement or instrument or performance is required under that agreement or instrument; (iii) "include(s)", "including" or any other variant thereof means "include(s), without limitation" or "including, without limitation," or any other variant thereof as the context

requires; (iv) the phrase "and/or" shall be deemed to mean the words both preceding and following such phrase, or either of them; (v) reference to a Person includes its heirs, executors, administrators, successors and permitted assigns; and (vi) any pronoun includes the corresponding masculine, feminine and/or neuter forms as the context may require. The words "will" and "shall" are used interchangeably throughout this Agreement; the use of either connotes a mandatory requirement; and the use of one or the other will not mean a different degree of right or obligation for either Party. The headings and captions for the articles, sections and subsections contained in this Agreement have been inserted for convenience only and form no part of this Agreement and shall not be deemed to affect the meaning or construction of any of the terms or conditions of this Agreement.

(i)

Days. Unless otherwise indicated, whenever this Agreement refers to a (i) number of days, such number shall refer to calendar days; and (ii) year, such year shall refer to a calendar year. If any deadline calculated in accordance with the provisions of this Agreement falls on a day that is not a Business Day, such deadline shall be extended automatically to the next Business Day.

(j)

Construction. The Parties acknowledge that (i) they are of equal bargaining strength and have jointly participated in the preparation of this Agreement; and (ii) any rule of construction to the effect that ambiguities are to be resolved against the drafting Party shall not apply in the interpretation of all or any portion of this Agreement, or to any amendment of this Agreement.

ARTICLE 2.

SERVICES

2.1.

Services.

(a)

Scope. Commencing on the Effective Date and throughout the Term, Contractor will exclusively manage, operate, and maintain the Transmission Facilities, including all repairs, replacements, upgrades, maintenance, overhauls, inspections, emergency services and procedures, procurement, capital additions and other improvements thereto, in accordance with the terms and conditions of this Agreement (collectively, the "Services"). Contractor shall be responsible for operation and maintenance means, methods, techniques, sequences, procedures and safety and security programs in connection with the performance of the Services. The Parties acknowledge that the Transmission Facilities are an integral component of the regional electric transmission system, and as such, ISO-NE retains Operating Authority over the Transmission Facilities in accordance with the terms of the TOA. Given the nature of the Transmission Facilities and the desire of the Parties to have a consistent approach to the maintenance of all transmission facilities being maintained by Contractor, Contractor will have full and exclusive control over the physical aspects of the Transmission Facilities, and Owner shall not interfere, or allow any Person acting for or on behalf of Owner to interfere, in the performance of the Services.

(b)

Performance Standard. Contractor shall provide, or cause to be

provided, the Services in accordance with Good Utility Practices and Law. EXCEPT AS SET FORTH IN THIS SECTION 2.1(b), CONTRACTOR MAKES NO OTHER GUARANTEES AND/OR WARRANTIES, EXPRESS OR IMPLIED, IN CONNECTION WITH THE SERVICES OR THE PERFORMANCE OF ANY OTHER OBLIGATIONS UNDER THIS AGREEMENT, AND CONTRACTOR SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTIES, INCLUDING IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

2.2.

Access. Contractor shall be responsible for managing access to the Transmission Facilities by Persons other than those acting on behalf of Contractor consistent with Good Utility Practices. Owner acknowledges that since (a) the Transmission Facilities are located on land not owned by Owner, (b) the violation of rights reserved by the underlying land owner in instruments granting the right to install the Transmission Facilities may result in Liability and/or adversely affect future maintenance practices, and (c) Contractor, in its discretion, has or will install gates to restrict access to certain properties and otherwise promote safety, security and good community relations, Owner shall comply and otherwise cooperate with any restrictions required by Contractor in connection with such access (including advance notice to affected land owners, compliance with safety requirements, and escorted access). Owner shall not access, and shall not authorize any Person acting for or on behalf of Owner to access, any of the Transmission Facilities without providing (written) notice to Contractor at least ten (10) Business Days before the day that Owner has scheduled for such access; provided that, if Owner requires such access to address a safety concern and/or other exigent circumstances, Owner shall provide (written) notice in advance of such access as is reasonable under the circumstances. Owner shall be solely responsible for, and shall indemnify, and shall defend and save the Indemnified Persons harmless from and against any Liability arising out of such access by Owner and/or Persons authorized by Owner in accordance with Article 9. Contractor reserves the right to charge Owner for costs incurred by Contractor in connection with such access to the extent that Contractor's staff would not have been at such location at such time other than in connection with such access; provided that Contractor shall not charge Owner in connection with infrequent requests for access for legitimate business purposes.

2.3.

Identification. Contractor reserves the right to mark, identify or otherwise designate the Transmission Facilities in connection with the performance of the Services. Owner acknowledges that Contractor intends to maintain the Transmission Facilities utilizing the system employed by Contractor for the identification and tracking of the O&M Assets; accordingly, Owner shall not take, and shall not allow any Person acting for or on behalf of Owner to take any action that could interfere, deface, or otherwise impair the effectiveness of Contractor's identification system.

2.4.

Warranties. Contractor shall use commercially reasonable efforts to administer and enforce any Third Party warranties applicable to the Transmission Facilities; provided that the terms and conditions of Section 1 of the Assignment shall

govern the respective rights and obligations of the Parties with respect to Partially Assigned Contracts (as defined in the Assignment).

2.5.

Hazardous Materials. The Parties acknowledge that the performance of the Services is not expected to involve the handling, removal, storage, exposure to, disposal of, or other contact with, Hazardous Materials in any manner whatsoever. If that expectation changes during the Term, the Parties will develop a plan to ensure the environmentally responsible management of any Hazardous Materials in full compliance with Law. In the case of an emergency, including as a result of storm restoration and/or other casualty, that requires any environmental remediation and/or the handling, removal, storage, exposure to, disposal of, or other contact with, Hazardous Materials (including any treated wood poles), Contractor shall manage such environmental conditions in accordance with Good Utility Practices (including Contractor's procedure for the disposal of wood poles) on Owner's behalf. Owner shall, at its sole cost and expense, do all such acts, execute and/or file all such documents (including any manifests and other documents required under Law), and cause to be done all such other things as Contractor may reasonably request from time to time in connection with such conditions; provided that Contractor shall not charge Owner an additional cost for the Services associated with such management of Hazardous Materials if and to the extent that the O&M Costs include similar services performed with respect to Contractor Facilities (in which case the Cost Allocation already accounts for such management). Owner shall be designated as the owner and/or responsible party on any documentation required in connection with any Hazardous Materials.

2.6.

Permits. Contractor shall maintain all Permits required for performing Services hereunder. As part of the Services, Contractor shall administer the Permits for the Transmission Facilities. If requested by Owner in connection with the fulfillment of its obligations under Section 3.3, Contractor shall assist Owner in the preparation and submission of applications for Permits to the extent applicable to the operation and maintenance of the Transmission Facilities.

2.7.

Regulatory Affairs.

(a)

Intent. The Parties acknowledge the benefits of cooperating and coordinating in the prosecution or defense of any Regulatory Proceeding that involves the Transmission Facilities and all or any portion of the Connecticut NEEWS Projects (irrespective of whether also involving any other Contractor Facilities and/or other electric transmission facilities of Owner). This Section 2.7 reflects the desire of Owner and Contractor to align their interests in any such Regulatory Proceedings.

(b)

Pending Proceedings. Contractor shall exclusively manage and control all Regulatory Proceedings pending as of the Effective Date that involve the Transmission Facilities. Schedule 2.7(b) describes all such pending Regulatory Proceedings.

(c)

Future Proceedings. Contractor shall exclusively manage and control all future Regulatory Proceedings that involve the Transmission Facilities. To the extent Contractor files any documents in such Regulatory Proceedings that are not available to the public, Contractor shall promptly provide to Owner a copy of such documents on a confidential basis; provided that Contractor may (i) further condition such disclosure on Owner's compliance with additional restrictions designed to preserve the confidentiality of such documents and/or the integrity of such Regulatory Proceedings; and (ii) redact or otherwise withhold any portion of such documents that contains information that Contractor considers proprietary, company confidential, or otherwise inappropriate for disclosure to a Third Party but for such Regulatory Proceedings.

(d)

Owner Actions. Owner, at its sole cost and expense, will perform all such acts, file all such documents, and cause to be done all such other things as Contractor may reasonably request from time to time in connection with any Regulatory Proceeding being managed by Contractor hereunder and otherwise fully cooperate with Contractor in such regard. Owner hereby appoints Contractor (and its agents) as the exclusive attorney-in-fact of Owner for the purpose of carrying out the provisions of this Section 2.7 and taking any action and executing any instrument that Contractor may deem necessary or advisable to accomplish the purposes hereof. Owner understands and agrees that the power of attorney granted to Contractor for purposes of this Section 2.7 is coupled with an interest and is irrevocable, and Owner hereby ratifies all actions taken by Contractor (and its agents) as Owner's attorney-in-fact by virtue hereof.

(e)

Owner Reservations. Notwithstanding anything to the contrary in this Section 2.7:

(i)

Owner reserves the right to participate in any Regulatory Proceeding that involves the Transmission Facilities in a manner that is not inconsistent with, or in any other manner adverse to, the positions and/or actions being taken and/or advanced by Contractor. To the extent that Owner desires to exercise such reserved right, the Parties shall reasonably cooperate and coordinate to ensure that Owner's participation supports Contractor's efforts. Without limiting the generality of the foregoing, Owner shall not file or otherwise submit any documentation in any such pending Regulatory Proceeding without furnishing a copy thereof to Contractor no later than ten (10) Business Days before the date the documentation is to be filed, and Owner shall modify such documentation in a manner reasonably requested by Contractor; and

(ii)

Contractor shall have no obligation whatsoever regarding, and this Section 2.7 shall not apply to, any Regulatory Proceeding for the rate making and/or cost recovery on account of the Transmission Facilities, including any Regulatory Proceeding pursuant to Section 205 of the Federal Power Act for incentive rates for the Transmission Facilities. Owner reserves the right to fully and solely manage and control any such Regulatory Proceeding; provided that nothing in this Agreement or elsewhere shall prohibit, restrict, limit and/or otherwise affect Contractor's ability to participate in,

and/or to take any action or position (even if adverse or contrary to Owner) during the course of, any such Regulatory Proceeding as a party, intervener or otherwise.

(f)

No Liability. Contractor shall have no Liability for, and Owner shall have no recourse whatsoever against Contractor with respect to, the disposition of any Regulatory Proceeding that involves the Transmission Facilities. Owner fully accepts and will solely bear the effects of any decision, order and/or other result in such Regulatory Proceedings.

2.8.

Independent Contractor; Subcontractors.

(a)

No Agency or Venture. Contractor shall perform this Agreement as an independent contractor and shall not be an agent (except to the extent specifically authorized herein) or an employee of Owner. Nothing in this Agreement creates or is intended to create an association, trust, partnership, joint venture or other entity or similar legal relationship between the Parties, or impose a trust, partnership or fiduciary duty, obligation, or liability on or with respect to either Party. Owner shall remain the exclusive owner of the Transmission Facilities, and nothing herein shall grant any right of ownership of whatever nature to Contractor.

(b)

Subcontracting. Contractor shall have the right to cause the Services to be accomplished by subcontractors, pursuant to subcontracts between Contractor and such subcontractors. Owner acknowledges that to the extent that Contractor requires services from any such subcontractor with respect to any O&M Assets, Contractor may include the Transmission Facilities and such O&M Assets within the scope of the same subcontract. This Agreement shall create no contractual relationship between Owner and any subcontractor of Contractor; provided that if any subcontractor has provided any warranties for its services performed with respect to the Transmission Facilities, the Services will include the administration and enforcement of any claims under such warranty.

(c)

Employment Policies. Contractor shall retain sole authority, control and responsibility with respect to its employment policies in connection with the performance of its obligations hereunder.

2.9.

Contractor Records. During the period required by FERC, Contractor shall keep and maintain, in accordance with Contractor's usual and customary record keeping system for its ordinary course corporate documents, appropriate records relating to Contractor's operation and maintenance of the Transmission Facilities. Upon reasonable advance notice by Owner to Contractor during the Term and for a period of one (1) year thereafter, Owner or its designee may audit and copy at its own expense, at reasonable times during normal business hours, such records maintained by, or in the possession of, Contractor for purposes of determining Contractor's compliance with the provisions of this Agreement; provided that (a) Contractor shall not be required to furnish any confidential or proprietary information; (b) Owner shall use such records solely for purposes related to the ownership, operation and maintenance of the Transmission

Facilities; and (c) Contractor reserves the right to condition Owner's access to certain records to maintain system integrity or similar purposes (including the inability to practically separate electronic records relating to the Transmission Facilities from records regarding other aspects of Contractor's business). Contractor shall make such records available to Owner or its designee at an office of Contractor located in Connecticut. Owner's review and audit right shall survive for one (1) year from the termination or expiration of this Agreement.

2.10.

Contractor Representative. Contractor shall designate (in writing) the Contractor Representative by notice to Owner given before or on the Effective Date. The Contractor Representative shall be authorized to receive direct communications from Owner and shall serve as the primary liaison with Contractor's senior management for any formal action required under this Agreement. The Contractor Representative has no authority to bind Contractor. Contractor may change the Contractor Representative from time to time by (written) notice to Owner.

ARTICLE 3.

OWNER RESPONSIBILITIES

3.1.

Cost; Risks. Owner shall bear all costs and risks associated with the ownership, operation and maintenance of the Transmission Facilities. Without limiting the generality of the foregoing, Owner acknowledges that Contractor is not assuming any risk or responsibility whatsoever, and has not granted any assurances of any kind with respect to the condition and/or operability of the Transmission Facilities, including the compliance thereof with Law. Subject to the collateral assignment of this Agreement in financing arrangements of Owner, Owner shall at all times retain the record and/or beneficial ownership of the Transmission Facilities. Contractor shall not receive or otherwise be entitled to any claim of ownership to the Transmission Facilities as a result of the performance of the Services. Contractor's obligations hereunder shall pertain solely to the Services pursuant to this Agreement, and Contractor shall not be deemed to be assuming any of the risks, obligations or benefits of ownership of the Transmission Facilities.

3.2.

Site. Owner shall maintain the License Agreement in full force and effect throughout the Term. Owner shall not take any action and/or allow any condition that could interfere with Contractor's full access to the Site during the Term. If any Third Party asserts a claim or interest based on any act or omission of Owner that could impair the full access to the Site by Contractor, and/or otherwise impair Contractor's ability to perform the Services, Contractor shall defend such claim and shall take such other actions as are necessary and appropriate to preserve Contractor's use of the Site, all at Owner's sole expense (which costs and expenses shall be in addition to, and shall not be considered part of, the Cost Allocation).

3.3.

Compliance. Owner shall comply with all Law and the rules, regulations and requirements of FERC, NERC, NPCC, ISO-NE, CONVEX and/or any other regional and/or national electric transmission authority (including the Planning Authority) and the TOA, in each case to the extent applicable to the Transmission Facilities. Owner shall be

responsible for obtaining and maintaining all Permits in full force and effect, including any fees and usage charges associated therewith; provided that to the extent that any Permit affects the Transmission Facilities and any O&M Assets, and without limiting the terms and conditions of Section 1 of the Assignment with respect to Common Permits (as defined in Exhibit D to the Definitive Agreement), Contractor shall be responsible for obtaining and maintaining such Permit in full force and effect, and Owner shall pay a proportionate share of any fees and/or usage charges associated therewith based on the ratio of the adjusted gross plant of the Transmission Facilities compared to the adjusted gross plant of all electric transmission facilities under such Permit. Unless otherwise required by Law, Permits solely applicable to the Transmission Facilities issued after the Effective Date shall be held in the name of Owner. Owner shall provide copies of all Owner-obtained Permits to Contractor promptly after issuance thereof to Owner. The Parties shall reasonably coordinate permitting activities, consistent with their respective obligations hereunder, and each Party shall notify the other if such Party becomes aware of any Permits required but not yet obtained by such other Party. Owner shall reasonably cooperate and assist Contractor in its efforts to comply with Permits.

3.4.

Operations.

(a)

Related Agreements. Owner shall promptly notify Contractor of any contracts, agreements and/or other undertakings of Owner or its Affiliates that could reasonably be expected to materially affect the operation and/or maintenance of the Transmission Facilities or any portion thereof (each a "Related Agreement"). Such notice shall include copies of any pertinent written materials regarding such Related Agreement and such additional details as may be available at such time. Owner shall be responsible for, and the Cost Allocation shall not include, all costs and expenses suffered or incurred by Contractor in connection with Contractor's compliance with any of such operational constraints.

(b)

Limitation. Notwithstanding anything to the contrary in this Agreement, Owner shall not (and/or shall not authorize or permit any other Person to): (a) attach and/or otherwise place any equipment and/or other items (including conductor, wires, telecommunication devices, microwave transmitters, and electronic equipment broadband) on or near the vicinity of any of the Transmission Facilities; or (b) physically alter any of the Transmission Facilities, in each case without (written) notice given at least thirty (30) days before taking of such action. Owner shall suspend or otherwise delay the taking of such action to account for any operational (including safety) concerns raised by Contractor with regard to such proposed action, and Owner shall modify such proposed action (including any Related Agreement) to the fullest extent possible to address Contractor's concerns. Nothing in this Agreement shall affect Owner's sole obligation to obtain any and all Permits required for such activities, and Contractor shall have no obligation whatsoever to assist or otherwise participate on Owner's behalf in such permitting effort.

(c)

No Contractor Liability. Contractor shall have no Liability of whatever nature with regard to, and/or arising out of, any Related Agreement and/or any

of the actions and/or events resulting from, and/or in connection with, such Related Agreement. Owner shall solely bear any Liability associated with each Related Agreement including the economic consequences of each such Related Agreement, any Regulatory Proceeding resulting from any Related Agreement, and/or any adverse effect of whatever nature on any of the Transmission Facilities due to any Related Agreement. Owner shall indemnify, defend and save the Indemnified Persons harmless from and against any and all Liability arising out of each Related Agreement in accordance with Article 9.

(d)

Definitive Agreement. Nothing herein shall amend, modify, change or otherwise affect Owner's obligations under the Definitive Agreement, including the compliance of any Related Agreement with applicable terms of the Definitive Agreement.

3.5.

Taxes. Owner shall solely bear and timely pay all Taxes (and/or payments in lieu thereof) associated with the Transmission Facilities and Owner shall prepare and file or cause to be filed all returns, certificates, applications or other documents relating thereto, in connection with all such Taxes. For the avoidance of doubt, the Cost Allocation does not include such Taxes.

3.6.

Insurance. Owner shall solely bear all risk of loss and casualty with respect to the Transmission Facilities. Owner shall obtain and maintain in effect throughout the Term (unless a longer duration is specified in Schedule 3.6), at a minimum, the insurance coverages set forth in Schedule 3.6 attached hereto and required under Section 9.5, through insurance carrier(s) having an AM Best rating of A or better (or otherwise acceptable to Contractor in its reasonable discretion); provided that during the period that UI and/or its Affiliates owns all of the Transmission Facilities, the carrier(s) insuring the other transmission facilities of UI and/or such Affiliates shall be deemed acceptable under this Agreement. All insurance required hereunder shall be endorsed to name Contractor and its Affiliates as additional insureds (other than for workers' compensation insurance). The amount of deductibles or self-insured retentions shall be for the sole account of Owner. All evidence of insurance maintained by Owner (including copies of policies) shall be available for Contractor's review and will be furnished to Contractor within ten (10) days after request. No later than ten (10) days after the Effective Date, Owner shall provide Contractor with certificate(s) of insurance demonstrating such coverages, and Owner shall ensure that its broker or insurer provides Contractor with replacement certificates evidencing required insurance coverage prior to the expiration of prior certificates. Such certificate(s) shall contain statements (a) indicating that Contractor shall receive a written notice at least thirty (30) days before cancellation/non-renewal or significant modification of any of such policies; and (b) confirming that Contractor and its Affiliates (as their interests may appear) have been named as additional insureds (other than under coverage for workers' compensation) and providing a waiver of subrogation which Owner may have against them. Such insurance coverages shall be primary to any other coverage available to Contractor or its Affiliates, and shall not be deemed to limit Owner's Liability under this Agreement.

3.7.

Owner Records. Owner shall keep and maintain, in accordance with Owner's usual and customary record keeping system for its ordinary course corporate documents, appropriate records relating to the Transmission Facilities. Upon reasonable advance notice by Contractor to Owner, Contractor or its designee may audit and copy, at reasonable times during normal business hours, such records maintained by, or in the possession of, Owner for purposes of determining Owner's compliance with the provisions of this Agreement; provided that (a) Owner shall not be required to furnish any confidential or proprietary information; and (b) Contractor shall use such records solely for purposes related to this Agreement. Owner shall make such records available to Contractor or its designee at an office of Owner located in Connecticut. Contractor's review and audit right shall survive for one (1) year from the termination or expiration of this Agreement.

3.8.

Compliance with CEII and CIP. In addition to the obligations set forth in Section 13.7, to the extent that Owner obtains any CEII in its exercise of its rights under this Agreement, Owner shall keep confidential any and all CEII whether or not solely applicable to the Transmission Facilities. To the extent any Services involve critical assets and critical cyber assets, Owner shall be bound by and comply with the NERC Critical Infrastructure Protection ("CIP") standards (CIP-002 through CIP-009). In addition, upon request by Contractor, Owner shall execute a certificate confirming full compliance with the foregoing obligations.

3.9.

Owner Representative. Owner shall designate (in writing) the Owner Representative by (written) notice given to Contractor before or on the Effective Date. The Owner Representative shall be authorized to receive direct communications from Contractor and shall serve as the primary liaison with Owner's senior management for any formal action required under this Agreement. The Owner Representative has no authority to bind Owner. Owner may change the Owner Representative from time to time by (written) notice to Contractor.

ARTICLE 4.

CAPITAL IMPROVEMENTS

4.1.

Owner Obligations.

(a)

Compliance with Approved Upgrades. Owner shall be solely responsible for all costs and expenses associated with Capital Improvements (including casualty repairs and upgrades). To the extent that a Planning Authority mandates, requires, approves and/or otherwise authorizes any Capital Improvement, including as a result of any request from a transmission owner (including Contractor), Owner shall be solely responsible for any and all costs associated therewith.

(b)

Planning Authority Interface. Contractor will exclusively interface, handle and otherwise communicate with ISO-NE and/or any other Planning Authority with respect to all matters relating to Capital Improvements. Without limiting the generality of the foregoing, Contractor shall participate on Owner's behalf before ISO-NE and/or any other Planning Authority in the planning and advocating of any and

all potential Capital Improvements, and Contractor shall prosecute and obtain all approvals from ISO-NE and/or any other Planning Authority required for any Capital Improvements. Owner, at its sole cost and expense, will do such acts, file such documents, and cause to be done all such other things as Contractor may reasonably request from time to time in connection with any Capital Improvement being managed by Contractor hereunder and otherwise cooperate with Contractor in such regard. Owner hereby appoints Contractor (and its agents) as the exclusive attorney-in-fact of Owner for the purpose of planning, implementing and otherwise advancing all Capital Improvements and taking any action and executing any instrument that Contractor may deem necessary or advisable to accomplish such purpose. Owner understands and agrees that the power of attorney granted to Contractor for purposes of this Section 4.1(b) is coupled with an interest and is irrevocable, and Owner hereby ratifies all actions taken by Contractor (and its agents) as Owner's attorney-in-fact by virtue hereof.

(c)

Limitation. Except to the extent that repairs made by Contractor under emergency conditions would constitute Capital Improvements, Owner shall not make or authorize any Capital Improvement without prior approval from ISO-NE and/or any other Planning Authority.

(d)

Generator Interconnection. For purposes of this Agreement, work resulting from proposals and/or other requests by the owner and/or operator of an electric generating facility to interconnect to the regional electric transmission grid through the Transmission Facilities shall not be considered Capital Improvements. In such case, Owner shall solely retain the rights and obligations associated with such requests and any resulting interconnection activities and/or related activities, including the construction and/or other installation of equipment. Owner shall promptly notify Contractor of any such request, and the Parties shall reasonably coordinate with respect to such interconnection activities and/or related activities to minimize, to the extent possible, any effect thereof on the performance of the Services.

(e)

Contractor Reservation. Nothing in this Agreement or elsewhere shall prohibit, restrict, limit and/or otherwise affect Contractor's ability to participate in, and/or to take any action or position (even if adverse or contrary to Owner) during the course of, any Proceeding regarding Capital Improvements; provided that in any such Proceeding, Contractor's position with respect to Contractor Facilities adjacent to the Points of Demarcation shall be consistent with Contractor's position with respect to the Transmission Facilities.

4.2.

Implementation.

(a)

Construction. As part of the Services, Contractor shall exclusively manage all phases of all Capital Improvements, including design and engineering, procurement, construction and installation. Contractor shall be responsible for all construction means, methods, techniques and procedures in connection with the performance of Capital Improvements and for overall control of the construction activities on the Site for such purposes.

(b)

Synergies. Owner acknowledges that for planned Capital Improvements, Contractor intends to implement such Capital Improvements in connection with related improvements to Contractor Facilities that interconnect with the Transmission Facilities and that such Capital Improvements may result in adjustments by Contractor to the Points of Demarcation. Contractor shall manage the Capital Improvements in the same manner that Contractor manages such related improvements to Contractor Facilities, and the Parties shall reasonably coordinate all planned Capital Improvements.

(c)

Storm Restoration. Contractor shall manage any and all Capital Improvements resulting from damage to the Transmission Facilities due to weather conditions in substantially the same manner that Contractor manages the restoration of Contractor Facilities.

4.3.

Cost Recovery.

(a)

Capital Costs. Owner shall pay Contractor all direct and indirect costs and expenses suffered and/or incurred by Contractor in connection with, and/or allocated by Contractor to, each Capital Improvement (collectively, "Capital Costs"), including:

(i)

all costs and expenses incurred in connection with the design, engineering, procurement, construction and installation of such Capital Improvement;

(ii)

all costs and expenses for equipment, parts, materials, supplies, storage, security, fuel and other consumables;

(iii)

all costs and expenses relating to planning, studies, engineering, permitting and/or management (before, during and after construction) of Capital Improvements;

(iv)

the cost of services (including the Services) performed by subcontractors and any other Third Party expenses incurred in connection with such Capital Improvement (including project management, environmental and permitting consultants, procurement, surveying and engineering services, testing, lobbyists, supplemental labor, and/or other work performed by Third Parties);

(v)

any and all fees, charges, expenses and other costs of whatever nature charged by any Third Party in connection with such Capital Improvement, including Taxes, fees for Permits (including charges to review and issue such Permits), charges due to land owners (including railroads) and Governmental Authorities, and any other one-time and/or recurring costs imposed on the performance of such work;

(vi)

non-Third Party expenses incurred by Contractor during the performance of the services (including the Services) associated with such Capital Improvement, including direct labor costs and the costs of employee benefits, overhead allocations and other embedded costs of Contractor and its Affiliates (including corporate center service level agreement costs (such as legal, human resources, insurance and payroll), business support costs and expenses, vacations, holidays, other non-productive time); and

(vii)

loaders and overheads (including administrative and general charges).

Contractor shall calculate the Capital Costs for each Capital Improvement and the resulting charges to Owner in substantially the same manner that Contractor determines cost allocation and recovery associated with similar capital projects performed with respect to Contractor Facilities.

(b)

Project Plan. Contractor will submit to Owner a proposed project plan, including a non-binding cost estimate (including contingencies and other reserves), for each Capital Improvement. Within thirty (30) days following such submission, the Parties will meet to review the proposed project plan and assess whether such plan reasonably satisfies the requirements of ISO-NE and/or any other Planning Authority for electric transmission facilities being addressed by such Capital Improvement. The Parties shall negotiate in good faith and with fair dealing to resolve any differences regarding the proposed plan; provided, however, if Contractor will be making capital improvements to any O&M Assets in connection with any Capital Improvement, Contractor shall be entitled to proceed with the implementation of such plan (including the making of such Capital Improvement) during such negotiation and resolution process to the extent appropriate to maintain schedule and/or minimize additional potential costs, as determined in Contractor's sole and exclusive discretion. The foregoing project planning provisions shall not apply to any Capital Improvement resulting from storm restoration and/or other emergency conditions, all of which shall be performed by Contractor in an effort to restore service pursuant to Good Utility Practices.

(c)

Performance Assurance. For each planned Capital Improvement, Owner shall deposit with Contractor within thirty (30) days after Contractor's request therefor, an amount equal to the average Capital Costs expected to be incurred over a one hundred twenty (120) day period based on the anticipated cash flow in the proposed project plan. Contractor shall calculate such security deposit amount in a manner consistent with the methodology used by Contractor to calculate security deposits under similar circumstances such as Contractor's construction of interconnection facilities for the owner (or developer) of a generating facility, and the amount on deposit shall vary from time to time based on projected cash flow during such one hundred twenty (120) day period on a rolling basis; provided that Contractor shall not release, other than in accordance with Section 6.4, any amounts to Owner during the final one hundred twenty (120) days of such installation period. For any Capital Improvement resulting from storm restoration and/or other emergency conditions, Contractor shall be entitled to (i) invoice

(including on an estimated basis subject to adjustment pursuant to Article 6) the Capital Costs associated with such Capital Improvement as part of the monthly invoice and/or as an out of cycle invoice that Owner shall pay within thirty (30) days after the date of invoice; and/or (ii) request a security deposit in an amount equal to Contractor's estimate of Capital Costs associated with such Capital Improvement, in which case Owner shall pay such security deposit to Contractor within fifteen (15) days after Contractor's request therefor. Interest shall accrue on amounts deposited as security at the FERC-approved interest rate for security deposits at such time, and accrued interest shall be paid to Owner in connection with the final release of such security deposit pursuant to Section 6.4. In addition to all of Contractor's rights and remedies hereunder and under Law, Owner shall be liable for late charges and costs of collection pursuant to Section 6.6 if Owner fails to provide any security deposit in full compliance with this Section 4.3(c). If Owner possesses a Credit Rating of Investment Grade or better as of the commencement of any Capital Improvement, Contractor shall waive the requirement of a security deposit under this Section 4.3(c) so long as Owner maintains such Credit Rating throughout the installation of such Capital Improvement, in which case, in lieu of such security deposit, Contractor shall invoice Owner in advance for the projected Capital Costs of such Capital Improvement on a monthly basis.

(d)

Payment. Owner shall pay Capital Costs to Contractor pursuant to Article 6. Monthly invoices issued pursuant to Section 6.1 shall reflect Capital Costs incurred during the immediately preceding month or estimates thereof.

(e)

Exclusion from Cost Allocation. All Capital Costs paid by Owner to Contractor on account of Capital Improvements shall be in addition to, and shall not be considered part of, the Cost Allocation.

ARTICLE 5.

COST ALLOCATION

5.1.

Calculation; Payment.

(a)

Owner Forecasting. No later than ninety (90) days before the commencement of each Calculation Period, Owner shall provide Contractor with information for such Calculation Period regarding (i) the gross plant value of the Transmission Facilities on Owner's books forecasted as of the first day of such Calculation Period using a methodology reasonably consistent with that used by Owner in its preparation of FERC Form 1 filed with respect to such adjusted gross plant values; (ii) any anticipated changes to such gross plant value during such Calculation Period; and (iii) any other data requested by Contractor in connection with the calculation of the Cost Allocation.

(b)

Applicable Percentage. The Applicable Percentage for each Calculation Period shall be equal to (i) the O&M Costs for the calendar year immediately preceding the commencement of the Calculation Period divided by (ii) the average of the beginning and end-of-year gross plant balances of CL&P Facilities for the calendar year immediately preceding the commencement of such Calculation Period. For example, the

Applicable Percentage for June 1, 20[__] through May 31, 20[__] is equal to the O&M Costs for 20[__] divided by the average of the beginning and end-of-year gross plant balances of CL&P Facilities for 20[__]. No later than thirty (30) days after the commencement of each Calculation Period, Contractor shall determine and submit to Owner the Applicable Percentage for such Calculation Period and the average forecasted gross plant value of the Transmission Facilities during such Calculation Period.

(c)

Cost Allocation. Commencing on the Effective Date, for each Calculation Period during the Term, Owner shall pay to Contractor the Cost Allocation for the Services (in addition to the cost of Capital Improvements and any other amounts due Contractor as authorized herein). The Cost Allocation for each Calculation Period shall equal the product, as determined by Contractor as of the commencement of each Calculation Period, of (i) the Applicable Percentage for such Calculation Period, times (ii) the average forecasted gross plant value of the Transmission Facilities during such Calculation Period, each as submitted by Contractor to Owner pursuant to Section 5.1(b). Schedule 5.1 sets forth an illustrative, non-binding calculation of the Cost Allocation based on certain assumptions (including the Calculation Period and assumed average gross plant values).

(d)

Payment. Owner shall pay the Cost Allocation in approximately equal monthly installments, in advance, as reflected in invoices issued by Contractor pursuant to Section 6.1.

5.2.

Adjustment. The Cost Allocation for each Calculation Period shall be adjusted as of the commencement of such Calculation Period in accordance with this Article 5.

5.3.

No True-Up. The Applicable Percentage and the average forecasted gross plant value of the Transmission Facilities for each Calculation Period shall be fixed as of the commencement of each Calculation Period and, unless ordered by FERC, shall not be subject to any true-up, adjustment and/or other modification whatsoever, including if the forecasted average gross plant value of the Transmission Facilities differs from actual amounts experienced during such Calculation Period. The Parties acknowledge that the use of such forecasts and averages is a reasonable basis for determining costs allocable to the Transmission Facilities.

5.4.

Partial Calculation Periods. Schedule 5.4 hereto sets forth the calculation of the Cost Allocation for the initial Calculation Period. If the Term expires before the end of a Calculation Period, the Cost Allocation for any such Calculation Period shall equal the product of (a) the entire Cost Allocation determined in accordance with Section 5.1, times (b) a fraction, the numerator of which is the number of days that this Agreement was in effect during such Calculation Period, and the denominator of which is the total days in such Calculation Period. For the avoidance of doubt, the Cost Allocation shall not be adjusted in any manner to reflect the actual gross plant value of the Transmission Facilities during any such partial periods.

5.5.

No Suspension. Notwithstanding anything to the contrary in this Agreement, any interruption of the use of the Transmission Facilities, the occurrence of any casualty or other damage that affects the operation of the Transmission Facilities, and/or any other event or circumstance that affects the operation of the Transmission Facilities, in whole or in part, shall not affect in any manner whatsoever the Cost Allocation which shall remain due and payable in full in accordance with this Agreement, and Owner's obligation to pay the Cost Allocation in full shall not be diminished or otherwise affected in any respect.

ARTICLE 6.

BILLING AND PAYMENT

6.1.

Monthly Invoices. Contractor shall prepare and submit monthly invoices to Owner for payments due hereunder, including the Cost Allocation and charges for Capital Costs for Services rendered during the preceding calendar month with respect to Capital Improvements (unless such Capital Costs shall be billed in advance pursuant to Section 4.3(c)). All invoices shall be subject to true-up for estimates and otherwise in accordance with this Article 6; provided that the foregoing shall not affect the restriction on any true-up hereunder, including under Section 5.3. Contractor shall supply any reasonably necessary data and calculations supporting an invoice. Owner shall pay the full amount of such invoices (including disputed amounts) within thirty (30) days after the date of invoice. Payment shall be made by wire transfer to an account from time to time designated by Contractor, or by other mutually agreeable method(s). Schedule 6.1 sets forth Contractor's initial wire transfer instructions.

6.2.

Taxes. Owner shall be responsible for all applicable Taxes (excluding income taxes imposed on Contractor) associated with the performance of the Services under this Agreement. Contractor shall use reasonable efforts to include, for remittance to the appropriate Governmental Authority, all such sales, use or other applicable Taxes in all invoices submitted hereunder. Owner shall be responsible for (a) any such Taxes that Contractor is obligated by Law to have collected, but shall not have collected; and (b) identifying and requesting any exemption from the collection of any such Tax by providing appropriate documentation to Contractor. Owner's obligations with respect to such Taxes shall survive the termination or expiration of this Agreement.

6.3.

Estimates. In the event that necessary billing data is not available in time to prepare a monthly invoice (including actual Capital Costs), Contractor may issue an invoice based on an estimate for that billing period, using good faith calculations. Any over-charge or under-charge resulting from such estimate shall be accounted for in the next billing period for which actual data is available.

6.4.

Security Deposit. If Owner has provided a security deposit for any Capital Costs pursuant to Section 4.3(c), such security deposit shall not be applied as a credit against the current amount due for the relevant Capital Improvement. Instead, Contractor shall refund such security deposit, together with interest at the rate set forth in Section 4.3(c), to Owner after the completion of such Capital Improvement and payment in full by Owner of all Capital Costs associated therewith.

6.5.

Adjustments; Disputes. Contractor may adjust any invoice previously rendered for any arithmetic, computational or other error, within one (1) year after the date of the invoice. Owner may challenge, in good faith, the correctness of all or any portion of any invoice rendered and/or adjusted by Contractor under this Agreement by (written) notice given within one (1) year after the issuance date of the affected invoice, and in the event of such challenge, payment of the full amount, whether or not disputed, shall be made when due. Any billing challenge or billing adjustment shall be given as soon as possible (in writing) and shall state the specific basis for the challenge or adjustment. An invoice, including an adjusted invoice, rendered under this Agreement shall be conclusive and binding on Owner unless challenged in accordance with this Section 6.5 within such one (1) year period from issuance. If it is determined that a payment is required from one Party to the other, such payment shall be made within thirty (30) days after such determination. Notwithstanding anything to the contrary in this Agreement, Owner shall not assert as a basis for withholding or otherwise not making payment that the amount(s) in question may or will not be recoverable in rates, and Owner hereby waives any excuse, right or other defense to payment on that basis.

6.6.

Late Charges; Collection Costs. In addition to all other payment obligations hereunder and under Law, if Owner fails to make any payment when due hereunder, interest shall accrue thereon as a late charge at the rate of one and one-half percent (1.5%) per month (or if less, the maximum rate allowable by Law (including under applicable FERC requirements)) from the date of issuance of the applicable invoice, which shall be immediately due and payable. Owner shall pay for all reasonable costs of collection and enforcement, including reasonable attorneys' fees, which may be incurred by Contractor in collecting or attempting to collect amounts due to Contractor hereunder or in otherwise enforcing its rights and remedies against Owner hereunder including its indemnification rights under Article 9.

6.7.

Records. Each Party shall keep such financial records as are necessary for verification of invoiced amounts and charges for Services. Such records shall be available for inspection and copying (to the extent not proprietary or otherwise containing trade secrets) by the other Party, at its cost, upon reasonable advance notice and at reasonable times during normal business hours, in accordance with Section 2.9 or Section 3.7, as the case may be, including the time period to conduct such inspections.

6.8.

Survival. The applicable provisions of this Agreement shall remain in effect after the expiration or termination of this Agreement to the extent necessary to provide for final billings, billing adjustments, the resolution of any billing disputes, and payment.

6.9.

Dispute Resolution. Any billing dispute that cannot be resolved through good faith negotiations shall be subject to the dispute resolution process in Article 11.

ARTICLE 7.

FORCE MAJEURE

7.1.

Force Majeure. As used in this Agreement, "Force Majeure" means an event or circumstance that prevents a Party from performing its obligations under this Agreement and is not within the reasonable control of such Party claiming Force Majeure (the "Claiming Party"). Consistent with the above, Force Majeure includes sabotage, strikes or other labor difficulties, riots or civil disturbance, acts of God, acts or omissions of ISO-NE or any regulatory or other Governmental Authority (including any such act or omission that prevents the Claiming Party from performing any of its material obligations hereunder), act of public enemy, drought, earthquake, flood, explosion, fire, lightning, landslide, or similarly cataclysmic occurrence, vehicular accidents, transmission outages or sudden or disruptive electrical events or disturbances on the Transmission Facilities, disruption of equipment and other materials necessary to perform the Services, or any other cause, whether of the kind herein enumerated or otherwise. The settlement of strikes, walkouts, lockouts, and other labor disputes shall be entirely within the discretion of Contractor, and Contractor may settle such dispute at such time and on such terms and conditions as it may deem to be advisable. Failure or delay of any subcontractor or vendor due to an event of Force Majeure, including unavailability of supplies or delays in deliveries by suppliers, shall be Force Majeure as to Contractor. Notwithstanding the foregoing, neither (a) mere economic hardship of a Party, (b) commercial impracticability experienced by a Party (including market changes, increased costs or insufficient money), and/or (c) inability of a Party to make payments shall constitute a Force Majeure.

7.2.

Procedure on Force Majeure Claim.

(a)

If the Claiming Party wishes to claim relief by reason of Force Majeure, it shall give (written) notice stating the date of commencement of such Force Majeure event and the predicted extent, estimated consequences and the cause thereof to the other Party as soon as reasonably practical after becoming aware of such event or circumstance.

(b)

The Claiming Party shall keep the other Party fully informed of any developments with respect to any Force Majeure.

(c)

If the Claiming Party claims relief by reason of Force Majeure and the other Party disputes the existence, nature, extent or condition of the event or circumstances giving rise to such claim for relief, then such dispute shall be resolved pursuant to Article 11.

(d)

The Claiming Party shall give notice to the other Party of the cessation of the relevant event or circumstance of Force Majeure as soon as practical after becoming aware of such cessation.

(e)

In the event that Force Majeure causes the Claiming Party to be unable to serve any notice hereunder, the period for the serving of such notice (if any) shall be extended for every day while such event or circumstance of Force Majeure prevents the service of such notice.

7.3.

Effects of Force Majeure. In the event the Claiming Party is prevented, in whole or in part, by a condition of Force Majeure from performing its obligations under this Agreement, the Claiming Party shall be excused from whatever performance is affected by the Force Majeure to the extent so affected, during continuance of the Force Majeure. The Claiming Party shall use commercially reasonable efforts to eliminate the Force Majeure condition as quickly as possible. A Force Majeure shall not excuse or otherwise affect Owner's obligations hereunder, including the payment of the Cost Allocation, and to the extent that Contractor continues to incur the same during continuance of the Force Majeure, Capital Costs.

ARTICLE 8.

TERMINATION; LIMITATION OF LIABILITY

8.1.

Termination for Asset Retirement. The Parties acknowledge that since the Transmission Facilities are interconnected to Contractor Facilities at the Points of Demarcation, the Transmission Facilities will not be retired by Owner except in connection with Contractor's decision to retire such interconnecting Contractor Facilities. Subject to the receipt of required retirement approvals, including those from ISO-NE, Owner shall take such action as appropriate to effect such retirement in a manner consistent with the retirement, in whole or in part, of such interconnecting Contractor Facilities. In the event of retirement, the Parties shall terminate this Agreement as to the Transmission Facilities affected by such retirement decision, effective on the date of such retirement as established by ISO-NE or other relevant authority. Each Party shall promptly notify the other Party after it becomes aware of any public effort to retire the Transmission Facilities in whole or in part, and without limiting the respective rights of the Parties under Section 2.7, the Parties shall reasonably coordinate and cooperate during the retirement process. Such termination shall be effective to the extent and on the date of such retirement. Notwithstanding anything to the contrary in this Section 8.1:

(a)

any partial termination of this Agreement due to retirement of a portion of the Transmission Facilities shall not affect in any manner whatsoever the calculation of, and/or Owner's obligations hereunder with respect to, the Cost Allocation, it being understood by the Parties that the Cost Allocation in the then current Calculation Period would reflect the anticipated effect of such retirement and subsequent Calculation Periods shall account for changes in gross plant values; and

(b)

termination of this Agreement due to retirement of all Transmission Facilities shall not excuse, discharge and/or affect in any manner whatsoever Owner's obligations hereunder with respect to the Cost Allocation for the remainder of the Calculation Period in which termination occurs, it being understood by the Parties that the average forecasted gross plant value for the Transmission Facilities in the Cost Allocation accounts for such retirement in such Calculation Period.

Termination due to retirement shall not affect any Liability incurred or accrued by, or on behalf of, Owner hereunder prior to the effective date of such retirement. Without limiting the generality of the foregoing, Contractor shall be compensated for all Services performed through the date of termination (in addition to the payment in full of the Cost

Allocation for the Calculation Period in which termination occurs). Nothing herein shall affect in any manner whatsoever the responsibility of Owner, including any and all Liability in connection therewith, to dismantle and remove the Transmission Facilities and to restore the Site after retirement of any Transmission Facilities.

8.2.

Events of Default. An "Event of Default" shall mean, with respect to a Party ("Defaulting Party"), the occurrence of any of the following:

(a)

the failure to pay any amount due hereunder within thirty (30) days after its due date, or if such payment is being contested in good faith by Contractor, Contractor shall fail to provide, within such thirty (30) day period, adequate assurance of its ability to pay such amount (including any late charges and collection costs) after resolution of such dispute;

(b)

the failure to perform any material obligation set forth in this Agreement (other than a payment default addressed in Section 8.2(a)), and such failure is not cured within ninety (90) days after receipt of notice of such failure from the non-defaulting Party; provided if such failure cannot be cured in ninety (90) days with the exercise of reasonable diligence, such failure shall not result in an Event of Default if (i) the Defaulting Party is diligently proceeding to cure such failure, and (ii) such Event of Default does not materially and adversely affect the operation of the Transmission Facilities; or

(c)

the Defaulting Party is Bankrupt.

Notwithstanding anything to the contrary in the foregoing, Owner shall promptly notify Contractor of any instance in which Owner has been notified by a Third Party or reasonably believes that Contractor has failed to operate and maintain the Transmission Facilities in accordance with Good Utility Practices. Such notice shall include reasonable detail regarding the alleged violation, the proposed compliance requirements, and a certification to the effect that Owner currently operates and maintains Owner's other electric transmission facilities using such proposed compliance requirements. If the Parties agree that such proposed compliance requirements or another change in practice is appropriate (including in connection with any dispute resolution), then Contractor shall proceed with reasonable diligence to effect such change, and the Parties shall reasonably cooperate in such regard. If Contractor disagrees with Owner's assertion of such failure, then such dispute shall be resolved pursuant to Article 11; provided that if such alleged violation could reasonably be expected to materially affect public health, safety, and welfare; worker health and safety (including safety conscious work environment); and/or environmental health and safety, then Contractor shall promptly effect such proposed compliance requirements (or a reasonable equivalent) pending the resolution of such dispute. If the results of such dispute resolution would require Contractor to implement changes in Contractor's standard operating practices, and Contractor is unwilling to do so, then Contractor shall advise Owner of such position, in which case Owner has the right to terminate this Agreement upon (written) notice to Contractor given within fifteen (15) days after being advised by Contractor of such position. Termination shall be the sole

and exclusive remedy of Owner in the event of any such dispute regarding Contractor's compliance with Good Utility Practices.

8.3.

Remedies. Upon the occurrence and continuance of an Event of Default, the non-defaulting Party has the right to terminate this Agreement upon ninety (90) days (written) notice to the Defaulting Party; provided that (a) this Agreement shall automatically terminate upon the occurrence of an Event of Default under Section 8.2(c); and (b) termination shall be subject to FERC acceptance or approval, if required. This Agreement shall not be terminated if the Event of Default is cured within such ninety (90) day notice period. Termination of this Agreement shall not affect any Liability incurred or accrued by, or on behalf of, a Party hereunder prior to the effective date of such termination.

8.4.

No Consequential Damages. NONE OF CONTRACTOR OR ITS AFFILIATES, PARTNERS, AGENTS, SUBCONTRACTORS OR VENDORS, OR THEIR RESPECTIVE EMPLOYEES, SHALL BE LIABLE HEREUNDER FOR CONSEQUENTIAL, SPECIAL, EXEMPLARY, INDIRECT, OR INCIDENTAL DAMAGES OR LOSSES, INCLUDING COST OF CAPITAL, LOSS OF GOODWILL, LOST REVENUES OR INCREASED OPERATING COSTS, REGARDLESS OF ANY UNAVAILABILITY OF ANY TRANSMISSION FACILITIES. NONE OF OWNER OR ITS AFFILIATES, PARTNERS, AGENTS, SUBCONTRACTORS OR VENDORS OR THEIR RESPECTIVE EMPLOYEES SHALL BE LIABLE HEREUNDER FOR CONSEQUENTIAL, SPECIAL, EXEMPLARY, INDIRECT OR INCIDENTAL DAMAGES OR LOSSES. The foregoing waiver of consequential damages shall not affect in any manner Owner's indemnification of the Indemnified Persons under Article 9. The waivers, releases and disclaimers of Liability expressed in this Agreement shall survive termination, cancellation or expiration of this Agreement, and shall apply (unless otherwise expressly indicated), whether in contract, equity, tort or otherwise, even in the event of fault, negligence, including sole negligence, foreseeable damages, strict liability, or breach of warranty of the Party released or whose Liabilities are limited, and shall extend to the partners, principals, directors, officers and employees, agents and other Affiliates of such Party, and their partners, principals, directors, officers and employees.

8.5.

Limitations of Contractor's Liability.

(a)

Owner Damage Limitation. Owner and/or any of Owner's Affiliates shall not be entitled to recover from Contractor and/or any of Contractor's Affiliates any damages resulting from the error or delay in the management, improvement, operation and/or maintenance of any of the Transmission Facilities, any damage to any of the Transmission Facilities, any outage or other unavailability of any of the Transmission Facilities, or any damages of any kind occurring during the management, improvement, operation and/or maintenance of any of the Transmission Facilities or otherwise arising out of the performance of this Agreement, unless such damages shall have resulted from a conscious, voluntary act or omission by CL&P in reckless disregard of a legal duty and of the consequences to another Person.

(b)

Maximum Contractor Liability. To the fullest extent allowable under Law and without limiting the scope of the limitations set forth in this Section 8.5 and elsewhere in this Agreement, Contractor's aggregate Liability to Owner and/or any of its Affiliates under or on account of this Agreement, whether founded in contract, tort (whether due to negligence, gross negligence, willful misconduct, strict liability or otherwise), statute or regulation, indemnity or otherwise, shall at all times be limited to One Million Two Hundred Thousand Dollars ($1,200,000.00).

(c)

Waiver. Owner hereby irrevocably waives, releases and discharges any and all rights, entitlements, objections, claims, discrepancies, disputes or other challenges, direct or indirect, relating to, or arising out of, any Liability of Contractor and/or any of its Affiliates in excess of the limitations set forth in this Section 8.5.

(d)

Survival. The provisions of this Section 8.5 shall survive termination or expiration of this Agreement.

8.6.

Mitigation. Each Party shall act in good faith to mitigate any Liability of a Party hereunder. This Section 8.6 shall survive termination or expiration of this Agreement.

8.7.

No Recourse. Neither Party shall have any recourse whatsoever against any of the directors, officers or employees of the other Party or against any of the other Party's Affiliates. Without limiting the generality of the foregoing, each Party, on behalf of itself and its Affiliates, hereby fully and irrevocably waives any right, claim or entitlement whatsoever against any such directors, officers or employees and/or such Affiliates relating to any Liability suffered or incurred by any of them from any acts or omissions of any of such Persons. Nothing in this Section 8.7 shall affect any separate guaranty, agreement and/or other undertaking by an Affiliate or any other Person with respect to the performance of a Party. This Section 8.7 shall survive termination or expiration of this Agreement.

ARTICLE 9.

INDEMNIFICATION

9.1.

General Indemnification by Owner. Owner shall be responsible for and shall indemnify, and shall defend and save Contractor, its Affiliates and their respective employees, trustees, shareholders, officers, and directors, as well as their respective agents, contractors and consultants (each, an "Indemnified Person") harmless from and against any and all Proceedings and/or Liabilities whatsoever (including consequences resulting from exposure to electromagnetic fields) regardless of whether or not such Proceeding and/or Liability is caused by or is attributable in whole or in part to any negligent act or omission of an Indemnified Person, suffered or incurred by any of such Indemnified Persons arising out of, and/or related to, the Transmission Facilities, the performance of the Services, and/or Owner's failure to comply with any of the terms and conditions of this Agreement; provided that if and to the extent that a court of competent jurisdiction conclusively determines that any such Proceeding and/or Liability has been

solely caused by the conscious, voluntary act or omission of an Indemnified Person in reckless disregard of a legal duty and of the consequences to another Person, then the foregoing indemnification shall not extend to (a) such Indemnified Person to the extent of the Proceeding and/or Liability solely caused by such act or omission of such Indemnified Person; or (b) any Indemnified Person to the extent of the Proceeding and/or Liability solely caused by such act or omission of such Indemnified Person if such Indemnified Person acted pursuant to authorized corporate action of Contractor.

9.2.

Environmental Indemnification. Without limiting the generality and scope of Section 9.1, Owner agrees to indemnify each Indemnified Person against, and defend and hold each of them harmless from any and all Environmental Liabilities (collectively, the "Indemnified Environmental Obligations") suffered or incurred by any of them, including any such Indemnified Environmental Obligation alleged, asserted, initiated or otherwise existing in respect of injury to persons, including death, and damage to property, business and/or natural resources or trespass or nuisance to property suffered by any Person. The foregoing indemnification shall include any Indemnified Environmental Obligation arising out of, and/or relating to, any acts or omissions of Contractor, any consultants, contractors, subcontractors, transporters, recyclers, or any treatment, storage or disposal facility or location used by Contractor or such other Persons, whether or not based upon any act or omission on or off the Site. Further, Indemnified Environmental Obligations shall include any Proceeding and/or Liability suffered, incurred and/or imposed as a result of actions pursued by any Governmental Authority. If and to the extent that a court of competent jurisdiction conclusively determines that any such Proceeding and/or Liability has been solely caused by the conscious, voluntary act or omission of an Indemnified Person in reckless disregard of a legal duty and of the consequences to another Person, then the foregoing indemnification shall not extend to (a) such Indemnified Person to the extent of the Proceeding and/or Liability solely caused by such act or omission of such Indemnified Person; or (b) any Indemnified Person to the extent of the Proceeding and/or Liability solely caused by such act or omission of such Indemnified Person if such Indemnified Person acted pursuant to authorized corporate action of Contractor.

9.3.

Indemnification Notice. Whenever a claim for indemnification shall arise under this Article 9, the affected Indemnified Person(s) shall give notice to Owner of the claim, including reasonable detail about the facts and circumstances thereof. Such notice shall be given as soon as reasonably practical following the time that such Indemnified Person realized its entitlement to indemnification hereunder. Notwithstanding the foregoing, the failure to provide such notice shall not prejudice, impair or otherwise adversely affect in any manner whatsoever the rights of the Indemnified Persons and the obligations of Owner, and such Indemnified Person(s) shall have no Liability to Owner as a result of the failure to provide such notice and such Indemnified Person(s) shall have all of the rights and benefits provided for in this Agreement, notwithstanding failure to provide such notice, except to the extent that such failure to provide notice prevents Owner from, or materially disadvantages Owner in, effectively defending any claim to which Owner's indemnification obligations under this Article 9 apply. Any notice given by an Indemnified Person pursuant to this Section 9.3 shall be deemed to have satisfied

the notice requirement with respect to any Managed Claim.

9.4.

Indemnification Procedure.

(a)

Assumption of Defense. If Owner has acknowledged, by notice given to the affected Indemnified Person(s) within a reasonable period after receiving the notice from such Indemnified Person(s) (based on the circumstances, but no more than five (5) Business Days after receipt of such notice), its indemnification obligation with respect to a particular claim, Owner, upon giving such notice to such Indemnified Person(s), may assume, at its sole cost and expense, the defense of any Third Party claim. Counsel selected for such defense of any Third Party claim shall be reasonably acceptable to such Indemnified Person(s), and such Indemnified Person(s) shall be entitled to participate in (but not control) such defense through its/their own counsel and at its/their own cost and expense; provided that, if the counsel selected by Owner advises that, due to actual or potential conflicts, separate counsel should represent such Indemnified Person(s), the expense of such separate counsel shall be an indemnified expense in accordance with the terms and conditions hereof, the full cost of which shall be borne by Owner. Such Indemnified Person(s) shall reasonably cooperate with Owner in connection with the defense of such Third Party claim. Notwithstanding anything to the contrary herein, each Indemnified Person shall have the right to retain separate counsel to represent such Indemnified Person, at the sole cost and expense of such Indemnified Person, concerning such Third Party claim, except to the extent such cost and expense are subsequently determined to be an indemnified expense.

(b)

Indemnified Persons' Rights. If Owner does not acknowledge its indemnification obligation for a particular Third Party claim, or does not timely assume the defense thereof, such Indemnified Person may defend such claim in such manner as it may deem appropriate. Owner shall bear all of the costs and expenses, including attorneys' fees, incurred by each Indemnified Person in connection with such defense all of which shall be paid from time to time within twenty (20) days after Owner receives a written request from any Indemnified Person for reimbursement (including reasonably detailed documentation in support of any such request), and Owner shall be entitled to participate (but not control) such defense through its own counsel and at its own cost and expense. Owner shall reasonably cooperate with such Indemnified Person in connection with the defense of such Third Party claim.

(c)

Owner Obligations. Notwithstanding its control of a defense of any Third Party claim, Owner shall not (i) make any admission or take any other action that is binding on, or otherwise attributable to any Indemnified Person; and/or (ii) consent to any settlement, entry of judgment or other disposition, in any or all instances without the prior written consent of the affected Indemnified Person(s).

(d)

Managed Claims. Notwithstanding anything to the contrary in this Section 9.4 and without affecting in any manner Owner's Liability with respect to any claim to which Owner's indemnification obligations apply under this Article 9, Managed Claims shall be managed and controlled pursuant to Paragraph F of the Purchase and Sale

Terms (as defined in the Definitive Agreement).

9.5.

Insurance. Owner shall obtain, and maintain at its sole cost and expense, such insurance as will insure its obligations under this Article 9; provided that the amount of available insurance shall not limit or otherwise restrict Owner's indemnity obligations hereunder. Nothing in this Article 9 shall prejudice or otherwise impair the rights of Contractor with respect to insurance coverage.

9.6.

Survival. Indemnification shall apply irrespective of the date of the assertion of any claim against an Indemnified Person and/or whether the Indemnified Person suffers or incurs any Liability before or after the expiration or earlier termination of this Agreement. The applicable provisions of this Agreement shall remain in effect after the expiration or termination of this Agreement to the extent necessary to provide for the determination and enforcement of Owner's indemnification obligation with respect to acts or events that occurred while this Agreement was in effect.

9.7.

Indemnification Limitation. Any indemnification or similar hold harmless obligation(s) under this Agreement shall not be enforceable to the extent that a court of competent jurisdiction conclusively determines that such obligation(s) is/are prohibited by Law. The Parties expressly acknowledge that none of the Transaction Documents constitutes a "contract or agreement relative to the construction, alteration, repair or maintenance of any building, structure or appurtenances thereto" as that phrase is used in Connecticut General Statutes § 52-572k.

ARTICLE 10. TERM

Subject to Section 13.11, this Agreement shall become effective upon the Effective Date and, unless earlier terminated in writing pursuant to this Agreement, shall remain in effect through December 31, 20__ [40 years] (the "Initial Term"). Unless either Party has notified the other Party at least two (2) years before the expiration of the Initial Term that such Party does not wish to continue this Agreement (in which case this Agreement shall terminate upon the expiration of the Initial Term), the Term shall be extended for an initial renewal term of twenty (20) years after the Initial Term, and thereafter, further renewed in ten (10) year increments. Either Party may elect not to renew this Agreement at the end of such initial or subsequent renewal term by giving a (written) notice to the other Party of such decision at least two (2) years before the expiration of the then current renewal term. Notwithstanding anything to the contrary in this Agreement, the Term shall expire simultaneously with the consummation of the Repurchase Closing or the Put Closing, each in accordance with (and as defined in) the Definitive Agreement.

ARTICLE 11. DISPUTE RESOLUTION

11.1.

Negotiation Between Executives. The Parties shall attempt in good faith to promptly resolve any dispute arising out of or relating to this Agreement by negotiation between executives who have authority to settle the controversy and who are

at a higher level of management than the Persons with direct responsibility for administration of this Agreement. Either Party may give the other Party (written) notice of any dispute not resolved in the normal course of business. Such notice shall include: (a) a statement of that Party's position and a summary of arguments supporting that position; and (b) the name and title of the executive who will be representing that Party and of any other Person who will accompany the executive. Within fifteen (15) days after delivery of the notice, the receiving Party shall respond with: (i) a statement of that Party's position and a summary of arguments supporting that position; and (ii) the name and title of the executive who will represent that Party and of any other Person who will accompany the executive. Within thirty (30) days after delivery of the initial notice, the designated executives of both Parties shall meet at a mutually acceptable time and place, and thereafter as often as they deem necessary, in good faith, to attempt to resolve the dispute. All reasonable requests for information made by one Party to the other will be honored. All negotiations pursuant to this Section 11.1 shall be confidential, subject to the provisions of Section 13.7 and shall be treated as compromise and settlement negotiations for purposes of Law and rules of evidence.

11.2.

Mediation. If the dispute has not been resolved by negotiation within forty-five (45) days after the disputing Party's notice, or if the Parties have failed to meet within thirty (30) days, each as contemplated in Section 11.1, the Parties shall attempt to settle the dispute by mediation under the then current CPR Mediation Procedure; provided, however, that if one Party refuses or fails to participate in negotiation pursuant to Section 11.1, the other Party may then immediately initiate mediation prior to the expiration of the forty-five (45) day negotiation period. Unless otherwise agreed, the Parties will select a mediator from the CPR Panels of Distinguished Neutrals.

11.3.

Arbitration. Any dispute arising out of or relating to this Agreement, including the breach, termination or validity thereof, that has not been resolved by a non-binding procedure as provided in Section 11.1 and/or Section 11.2 within ninety (90) days after notice of the dispute, shall be resolved by final and binding arbitration in accordance with the then current CPR Rules for Non-Administered Arbitration by a sole neutral arbitrator designated in accordance with CPR Rule 5.3, for any dispute involving amounts in the aggregate under Three Million Dollars ($3,000,000.00), or, for any dispute involving amounts in the aggregate equal to or greater than Three Million Dollars ($3,000,000.00), by three (3) arbitrators, with each Party designating one (1) arbitrator in accordance with the "screened" appointment procedure set forth in CPR Rule 5.4, and with the third arbitrator being appointed in accordance with CPR Rule 5.4(e); provided, however, that if either Party will not participate in a non-binding mediation Proceeding as specified in Section 11.2, the other Party may thereafter immediately initiate arbitration (before expiration of the above-mentioned ninety (90) day period). The arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. §§ 1-16, inclusive, and judgment upon the award rendered by the arbitrator(s) may be entered by any court having jurisdiction thereof. The place of arbitration shall be Hartford, Connecticut.

11.4.

Powers of Arbitrator(s). Except with respect to any and all claims of Third Parties, the arbitrator(s) are not empowered to award damages in excess of

compensatory damages (subject to the limitation on Liability set forth herein) and each Party expressly waives and foregoes any right to have the arbitrator(s) award indirect, incidental, consequential, special, exemplary, punitive or similar damages, except to the extent Law requires that compensatory damages be increased in a specified manner, or except with respect to any and all Claims of Third Parties. All costs of the arbitration shall be paid equally by the Parties, unless the award shall specify a different division of such costs. Each Party shall be responsible for its own expenses, including attorneys' fees. Each Party shall be afforded adequate opportunity to present information in support of its position on the dispute being arbitrated. The arbitrator(s) also may request additional information from the Parties.

11.5.

Deferral. The Parties may agree to defer any arbitration Proceeding, without prejudice to any Indemnified Person, pending the resolution of a particular claim of a Third Party disputed by the Parties.

11.6.

Continued Performance. Contractor shall continue performance of the Services in conformance with the requirements of this Agreement notwithstanding the

existence of any dispute or controversy between the Parties; provided that Owner shall continue to make disputed and undisputed payments to Contractor in accordance with the terms hereof.

11.7.

Compelled Arbitration. Each Party will proceed in good faith to conclude the arbitration Proceeding as quickly as reasonably possible. If a Party refuses or fails to participate in an arbitration Proceeding as required by this Agreement, the other Party may petition any Governmental Authority having proper jurisdiction for an order directing the refusing Party to participate in the arbitration Proceeding. All costs and expenses, including attorneys' fees, incurred by the petitioning Party in enforcing such participation will be paid for by the refusing Party.

11.8

Related Parties and Proceedings.

(a)

Related Parties. Each Party shall have the right, but not the obligation, to join or otherwise require others (including any guarantor of such Party's obligations) to participate as parties and/or witnesses, in the sole and exclusive discretion of each such Party exercised in good faith, in any dispute resolution Proceeding hereunder (including any negotiation between executives, mediation and/or arbitration). If either Party, in its sole and exclusive discretion exercised in good faith, exercises such right, then such additional party and/or parties shall be an equal participant in, and subject to all rules and requirements of, such Proceeding; provided that if such additional participation involves an arbitration Proceeding for disputes involving amounts in the aggregate equal to or greater than Three Million Dollars ($3,000,000.00), then three (3) arbitrators shall be designated pursuant to the "screened" appointment procedure referenced in Section 11.3, with one (1) arbitrator being appointed by Contractor, one (1) arbitrator being appointed by Owner, and the third arbitrator appointed in accordance with CPR Rule 5.4(e).

(b)

Participation. Each Party shall have the right, but not the obligation, to require the other Party to join or otherwise participate as a party and/or witness, in the sole and exclusive discretion of such Party exercised in good faith, in any dispute resolution Proceeding (including any negotiation between executives, mediation and/or arbitration) involving all or any portion of the Transmission Facilities. If either Party, in its sole and exclusive discretion exercised in good faith, exercises such right, then the other Party shall act in good faith, coordinate and cooperate with such Party and the other parties to the Proceeding, and otherwise proceed as though such Proceeding involved a dispute under this Agreement. Both Parties hereby consent to being so joined and waive and release, to the fullest extent permitted by Law, any objection, right or other claim that such Party cannot be compelled or otherwise has no obligation to participate in any such Proceeding. The joined or otherwise participating Party shall solely bear all costs and expenses incurred in connection with such participation.

(c)

Compelled Participation. If either Party refuses or fails to comply with this Section 11.8, in whole or in part, the other Party may petition any Governmental Authority having proper jurisdiction for an order directing such refusing or non-complying Party to so comply. All costs and expenses, including attorneys' fees, incurred by the other Party in enforcing such participation will be paid by such refusing or non-complying refusing Party.

ARTICLE 12. REPRESENTATIONS

As of the Effective Date, each Party represents and warrants to the other Party that: (a) it is duly organized, validly existing and in good standing under the Laws of the jurisdiction of its formation, (b) it has all regulatory authorizations necessary for it to legally perform its obligations under this Agreement, (c) the execution, delivery and performance of this Agreement are within its powers, have been duly authorized by all necessary action and do not violate any of the terms and conditions in its governing documents, any contracts to which it is a party, or any Law applicable to it, (d) this Agreement constitutes its legally valid and binding obligation enforceable against it in accordance with its terms, (e) there is not pending or, to its knowledge, threatened against it any Proceedings that could materially adversely affect its ability to perform its obligations under this Agreement, and (f) no Event of Default or event which, absent a cure, with the giving of notice or lapse of time, or both, would constitute an Event of Default with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement.

ARTICLE 13.

MISCELLANEOUS PROVISIONS

13.1.

Applicable Law.

(a)

Governing Law. This Agreement and the rights and duties of the Parties hereunder shall be governed by and construed, enforced and performed in accordance with the Law of the State of Connecticut, without regard to principles of

conflicts of law thereof, except to the extent that the Laws of another jurisdiction must govern certain aspects of the enforcement of the rights and remedies of the Parties (including legal process and procedure).

(b)

Jurisdiction. The Parties hereby consent to the exclusive personal and subject matter jurisdiction of any federal or state court located within the State of Connecticut for the enforcement of the outcome of any and all arbitration Proceedings pursuant to Article 11 and any other legal or equitable Proceedings arising out of or relating to this Agreement. Each Party hereby irrevocably waives and releases, to the fullest extent permitted by Law: (i) any objection to the venue of any such Proceeding brought in such a court; and (ii) any claim that any such Proceeding brought in such court has been brought in an inconvenient forum.

(c)

Waiver of Jury Trial. The Parties hereby expressly, irrevocably, fully and forever, release, waive and relinquish any and all right to trial by jury with respect to any Proceeding by or against the other arising under this Agreement.

13.2.

Binding Effect; Assignment.

(a)

This Agreement shall be binding upon the Parties and their respective successors and permitted assigns.

(b)

Owner is not authorized to and shall not directly or indirectly (through an equity sale, merger or other transaction) sell, assign or otherwise transfer its interest in this Agreement, in whole or in part, other than in full compliance with Paragraph H of Exhibit D to the Definitive Agreement, in which case this Agreement shall be assigned to any Person that so acquires ownership of the Transmission Facilities.

(c)

Contractor shall not assign or otherwise transfer its interest in this Agreement without the prior (written) consent of Owner, which shall not be unreasonably withheld or delayed; provided, however, Contractor may assign, without recourse, this Agreement without the consent of Owner to (i) an Affiliate; (ii) any Person acquiring all or substantially all of the electric transmission assets of Contractor; and/or (iii) any Person providing operations and maintenance services to Contractor Facilities located in the vicinity of the Transmission Facilities. Contractor also may assign this Agreement without the consent of Owner to any Person if Contractor remains unconditionally liable for all of the obligations and other Liabilities of such transferee hereunder notwithstanding such transfer. Any and all rights and/or obligations of Contractor under this Agreement may be exercised and/or performed by NUSCO or any other Affiliate of Contractor acting as agent for Contractor, and such performance shall not constitute an assignment and/or assumption of Liability by NUSCO and/or any such Affiliate.

(d)

Any purported direct or indirect sale, assignment or other transfer of any interest, in whole or in part, in violation of this Section 13.2 shall be null, void and of no force or effect.

(e)

Notwithstanding anything to the contrary in this Section 13.2 or elsewhere in this Agreement and without limiting Contractor's discretion with respect to any proposed transfer, unless otherwise directed by Contractor, this Agreement shall be assigned to any purchaser or other transferee of the Transmission Facilities, to the extent of the transferred interest, for the remainder of the Term under an assumption and assignment agreement pursuant to which the transferee agrees to be bound by the terms of this Agreement in a form acceptable to Contractor. Without limiting the generality of the foregoing, in connection with such assumption and assignment, such purchaser or other transferee of the Transmission Facilities shall demonstrate to Contractor compliance with all of the requirements of this Agreement applicable to Owner, including the maintenance of insurance pursuant to Section 3.6.

13.3.

Notices. All notices, demands, directions, approvals, requests, acknowledgements, consents, authorizations, permission, invoices and/or other communications required or permitted to be given hereunder by the Parties shall be in writing, sent to the recipient's address set forth below and shall be effective: (a) when personally delivered to the recipient; (b) five (5) days after deposit of the notice addressed as provided below in the U.S. mail, if sent by U.S. certified mail, return receipt requested; or (c) one (1) Business Day after deposit with a recognized overnight courier or delivery service for delivery on the next Business Day.

The addresses for notice are:

Owner:

The United Illuminating Company

157 Church Street

New Haven, Connecticut 06510

Attention:

______________

With a copy to:

The United Illuminating Company

157 Church Street

New Haven, Connecticut 06510

Attention:

General Counsel

Contractor:

c/o Northeast Utilities Service Company

107 Selden Street

Berlin, Connecticut 06037

Attention:

___________

With a copy to:

Northeast Utilities Service Company

P. O. Box 270

Hartford, Connecticut 06141

Attention:

General Counsel

Address for couriers:

56 Prospect Street

Hartford, Connecticut 06103-2818

Either Party may send any such notice or other communication using any other means (including personal delivery, expedited courier, messenger service, ordinary mail, or electronic mail), but no such notice or other communication using such other means shall be deemed to have been duly given unless and until it actually is received by the intended recipient. Either Party may change the address to which notices and other communications hereunder are to be delivered by giving the other Party notice in the manner herein set forth.

13.4.

Waivers. Any and all waivers by either Party of any breach of, and/or other non-compliance with, any term and/or condition of this Agreement must be in writing, delivered to the other Party in accordance with Section 13.3. The waiver by either Party of any breach of, and/or other non-compliance with, any term and/or condition of this Agreement shall not operate or be construed as a waiver of any subsequent breach or non-compliance (except to the extent expressly so stated in the applicable (written) waiver). No course of dealing shall operate as a waiver of any right, power or privilege hereunder, and no single or partial exercise of any such right, power or privilege shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege.

13.5.

Invalid Provisions. If any provision of this Agreement is adjudged in arbitration or by a court of competent jurisdiction to be illegal, invalid or unenforceable at law or in equity for any reason, the same shall, if possible, be modified to the extent necessary to make it legal, valid and enforceable, or, if not possible, such provision shall be deleted. The remaining provisions of this Agreement shall remain enforceable notwithstanding the illegality, invalidity or unenforceability of any individual provision. The Parties also shall negotiate an equitable adjustment to this Agreement with a view toward effecting, to the extent possible, the original purpose and intent of the severed provision.

13.6.

Survival. All agreements, representations, warranties and covenants made by each Party in this Agreement and in the documents delivered by each Party pursuant to this Agreement shall be considered to have been relied upon by the other Party and shall survive expiration or earlier termination of this Agreement for so long as is necessary to fulfill the intent thereof. All requirements, terms, conditions and provisions that by their nature are incapable of being fully performed within the Term, including

each Party's non-disclosure obligations, Owner's payment obligations, and Owner's indemnities for the benefit of Indemnified Persons, shall survive cancellation, termination or expiration of

this Agreement for so long as is necessary to fulfill the intent thereof. The remaining terms and conditions of this Agreement shall survive to the extent necessary to give effect to such surviving requirements, terms, conditions and provisions.

13.7.

Confidentiality. During the Term and for a period of one (1) year thereafter, each Party shall (a) keep confidential the terms of this Agreement and all written information furnished by the other Party in furtherance hereof and conspicuously marked as "Confidential Information;" (b) not disclose or reveal, except as permitted pursuant to this Section 13.7, any such confidential information to any Person other than such Party's employees directly involved with the transactions contemplated hereby; and (c) not use such information other than consistent with the terms hereof. Each Party shall notify the other Party of any unauthorized disclosure and shall be responsible for any breach hereof by such Party and its representatives. The receiving Party and/or its representatives may disclose such confidential information under any of the following conditions:

(i)

if required by Law, including as required in connection with Permits contemplated hereunder;

(ii)

to attorneys for, or consultants or independent public accountants of, any Party, or any Person who has provided financing to a Party for the transactions contemplated hereunder, provided that in each case only if such Person shall be bound by a confidentiality agreement embodying the terms of this Section 13.7;

(iii)

if required to be disclosed in connection with the prosecution or defense of any Proceeding;

(iv)

if such confidential information is or becomes part of the public domain by means other than actions taken by the receiving Party or on its behalf;

(v)

if the receiving Party rightfully received such confidential information from sources other than the disclosing Party without breach of an obligation of confidentiality;

(vi)

if the receiving Party independently developed such information without reliance on the confidential information disclosed by the disclosing Party; or

(vii)

if agreed to in writing by the disclosing Party.

In the event disclosure is made pursuant to clause (i), the Party effecting such disclosure shall (1) promptly notify the other Party thereof so that such Party may seek a protective order or other appropriate remedy, and (2) use reasonable efforts to minimize the scope

of any disclosure and to require that the recipient(s) maintain the confidentiality of any confidential information covered by this Section 13.7. Notwithstanding anything to the contrary in this Agreement, the receiving party shall not make use of any such confidential information other than for the sole purpose of operating and/or maintaining the Transmission Facilities. Each Party acknowledges that the other Party would not have an adequate remedy at law and would be irreparably harmed if such Party breached this Section 13.7; accordingly, without prejudice to the rights and remedies otherwise available, each Party shall be entitled to equitable relief by way of injunction to prevent breaches of this Section 13.7 by the other Party or any other recipients of such confidential information.

13.8.

Publicity. Except as required by Law, Owner shall not publicize (including through any press release, advertising or other promotional or publicity activity) the relationship between the Parties, this Agreement, the Services, or the transactions contemplated hereunder without the prior (written) consent of Contractor (which consent may be granted or withheld in Contractor's sole and exclusive discretion) whether prior to or after expiration or earlier termination of this Agreement.

13.9.

Further Assurances. The Parties shall from time to time, execute and deliver such additional instruments, documents, conveyances or assurances and take such other actions as shall be necessary, or otherwise reasonably requested by the other Party, to clarify, confirm and assure the rights and obligations provided for in this Agreement.

13.10.

Counterparts/Facsimiles/PDF Copies. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, and it shall not be necessary in making proof of this Agreement or the terms hereof to produce or account for more than one of such counterparts; provided that the counterpart produced bears the signature of the Party sought to be bound. Facsimile signatures and "portable document format" (PDF) copies of signatures shall be deemed original signatures.

13.11.

FERC Acceptance. The effectiveness of this Agreement shall be subject to acceptance by FERC of the terms and conditions hereunder. If FERC does not accept this Agreement, or conditions acceptance of this Agreement, the Parties shall negotiate in good faith to develop an alternate arrangement (including appropriate modifications to this Agreement) that will accomplish the purpose and intent of this Agreement in a manner acceptable to FERC. The effectiveness of the termination of this Agreement shall be subject to acceptance by FERC, if and to the extent required.

[SIGNATURE PAGE TO FOLLOW]

IN WITNESS WHEREOF, the Parties have caused their duly authorized representatives to execute this Agreement as of the Effective Date.

Footnotes

¹ Average is calculated as (beginning of period value + end of period value) / 2

² Any such adjustment to the fixed rate shall be subject to the receipt, on terms satisfactory to each Party (in the sole and exclusive discretion of such Party exercised in good faith), of any required FERC authorization and approval.


		Page No.

SECTION 1.	Definitions of Terms; Interpretation	1

SECTION 2.	NUSCO	17

SECTION 3.	UI Investments	18

SECTION 4.	Modification, Termination or Sale of the Connecticut NEEWS Projects	28

SECTION 5.	Development of the Connecticut NEEWS Projects	30

SECTION 6.	Limitations Re: UI Assets	30

SECTION 7.	Operation and Maintenance of UI Assets	31

SECTION 8.	Intentionally Omitted	32

SECTION 9.	Support	32

SECTION 10.	Intentionally Omitted	33

SECTION 11.	Confidentiality	33

SECTION 12.	Due Diligence	33

SECTION 13.	Conditions Precedent to UI Investments; Conditions Precedent to Transfer to UI of UI Assets; Satisfaction of Conditions Precedent; Compliance with HSR Act; Non-Assignability of Certain Rights to UI Assets; Compliance Filings at Transfer; Pre-Closing Termination of Conveyance Due to Adverse Actions	34

SECTION 14.	Information; Records	40

SECTION 15.	Representations and Warranties	41

SECTION 16.	Transfer of the Connecticut NEEWS Projects	41

SECTION 17.	Term and Termination; Change of Control of Parent and/or UI; Impact to NU/NGrid Incentive Rates	42

SECTION 18.	Events of Default; Remedies	43

SECTION 19.	Limitation of Liability/Waiver of Consequential Damages	44


SECTION 20.	Dispute Resolution	45

SECTION 21.	Relationship of the Parties	47

SECTION 22.	Public Announcement	48

SECTION 23.	Miscellaneous Provisions	48


Aggregate Cost of all Connecticut NEEWS Projects:		Maximum Aggregate UI Investment Rights:
(i) Less than or equal to $147,000,000.00		$25,000,000.00
(ii) $147,000,000.01 to $350,000,000.00		$25,000,000.00 plus ((20/203)*(aggregate Cost of the Connecticut NEEWS Projects in excess of $147,000,000.00))
(iii) $350,000,000.01 to $398,000,000.00		$45,000,000.00


(iv) $398,000,000.01 to $650,000,000.00		$45,000,000.00 plus ((15/252)*(aggregate Cost of the Connecticut NEEWS Projects in excess of $398,000,000.00))
(v) $650,000,000.01 to $711,000,000.00		$60,000,000.00
(vi) $711,000,000.01 or greater		8.4% of aggregate Cost of the Connecticut NEEWS Projects


Segment	Miles	Segment Cost, $M	% of GSRP	Starting Structure	Ending Structure
1. Manchester to Meekville Line	2.0	12.3	8.4	3703	3719
2. N. Bloomfield to Rt. 20	4.7	16.3	11.1	3	46
3. Rt. 20 to CT-MA border	7.2	25.0	17.0	47	113


	If to CL&P:

	The Connecticut Light and Power Company
	107 Selden Street
	Berlin, CT 06037
	Attention: Project Director – NEEWS

	With a copy to:

	Northeast Utilities Service Company
	P. O. Box 270
	Hartford, Connecticut 06141
	Attention: General Counsel


	Address for couriers:

	56 Prospect Street
	Hartford, Connecticut 06103-2818

	And if to UI:

	The United Illuminating Company
	157 Church Street
	New Haven, CT 06510
	Attention: Vice President Transmission Business

	With a copy to:

	The United Illuminating Company
	157 Church Street
	New Haven, Connecticut 06510
	Attention: General Counsel


		Page No.

Paragraph A.	Identification of UI Assets to be Conveyed to UI	1

Paragraph B.	Closing of Conveyance of each Group of Purchased UI Assets;
	Closing Adjustments	1
	1. Closing	1
	2. Closing Adjustments	2

Paragraph C.	CL&P’s Obligation Re: Sale and Conveyance	4

Paragraph D.	UI’s Obligations Re: Purchase and Assumption	4

Paragraph E.	Delivery of Documents at Closing/Effects of Closing	5
	1. Deliveries by CL&P	5
	2. Deliveries by UI	6
	3. Effect of Closing	7

Paragraph F.	Claims Management	7
	1. Managed Claims	7
	2. Management Standard	8
	3. UI Support	8
	4. Liability for Managed Claims	9
	5. Related Claim Management	9
	6. Payment	10
	7. Joint Defense Agreement	10
	8. Waiver of Conflict	10
	9. UI Reservations	11
	10. Notice	11
	11. Public Relations	11
	12. Non-Managed Claims	12
	13. Regulatory Proceedings	12
	14. Survival	12

Paragraph G.	Indemnification	12
	1. General Indemnification	12
	2. Environmental Indemnification	13
	3. Indemnification Notice	13
	4. Indemnification Procedure	14
	5. Survival	14
	6. Insurance	15
	7. Indemnification Limitation	15


Paragraph H.	Restrictions on Transfer of UI Assets	15
	1. Consent Requirement	15
	2. Transfers in Violation	17

Paragraph I.	Right of First Refusal; Unwind Upon Termination Due to Transaction Event of Default	17
	1. Right of First Refusal	17
	2. Unwind Upon Termination Due to Transaction Event of Default	18
	3. Survival	21

Paragraph J.	Additional Rights; Reserved Rights; Retirement	21
	1. Regulatory Matters	21
	2. Reserved Rights	23
	3. Retirement	23
	4. Condemnation Rights	23
	5. Late Charges; Collections Costs	24


Witnessed by		THE CONNECTICUT LIGHT AND POWER COMPANY

	By:
		Name: [_________]
		Title: [_________]
		Duly Authorized


			THE UNITED ILLUMINATING COMPANY

		By:
			Name: [_________]
			Title: [_________]
			Duly Authorized


My Commission Expires:
		Notary Public


		Notary’s Printed/Typed Name


			Page

ARTICLE 1.		DEFINITION OF TERMS; INTERPRETATION

	1.1. Definitions
	1.2. Entire Agreement; Interpretation

ARTICLE 2.		SERVICES

	2.1. Services
	2.2. Access
	2.3. Identification
	2.4. Warranties
	2.5. Hazardous Materials
	2.6. Permits
	2.7. Regulatory Affairs
	2.8. Independent Contractor; Subcontactors
	2.9. Contractor Records
	2.10. Contractor Representative

ARTICLE 3.		OWNER RESPONSIBILITIES

	3.1. Cost; Risk
	3.2. Site
	3.3. Compliance
	3.4. Operations
	3.5. Taxes
	3.6. Insurance
	3.7. Owner Records
	3.8. Compliance with CEII and CIP
	3.9. Owner Representative

ARTICLE 4.		CAPITAL IMPROVEMENTS

	4.1. Owner Obligations
	4.2. Implementation
	4.3. Cost Recovery

ARTICLE 5.		COST ALLOCATION


	5.1. Calculation; Payment
	5.2. Adjustment
	5.3. No True-Up
	5.4. Partial Calculation Periods
	5.5. No Supsension

ARTICLE 6.		BILLING AND PAYMENT

	6.1. Monthly Invoices
	6.2. Taxes
	6.3. Estimates
	6.4. Security Deposit
	6.5. Adjustments; Disputes
	6.6. Late Charges; Collection Costs
	6.7. Records
	6.8. Survival
	6.9. Dispute Resolution

ARTICLE 7.		FORCE MAJEURE

	7.1. Force Majeure
	7.2. Procedure on Force Majeure Claim
	7.3. Effects of Force Majeure

ARTICLE 8.		TERMINATION; LIMITATIONS OF LIABILITY

	8.1. Termination of Asset Retirement
	8.2. Events of Default
	8.3. Remedies
	8.4. No Consequential Damages
	8.5. Limitations of Contractor’s Liability
	8.6. Mitigation
	8.7. No Recourse

ARTICLE 9.		INDEMNIFICATION

	9.1. General Indemnification by Owner
	9.2. Environmental Indemnification
	9.3. Indemnification Notice
	9.4. Indemnification Procedure
	9.5. Insurance
	9.6. Survival
	9.7. Indemnification Limitation

ARTICLE 10.		TERM

ARTICLE 11.		DISPUTE RESOLUTION


	11.1. Negotiation Between Executives
	11.2. Mediation
	11.3. Arbitration
	11.4. Powers of Arbitrator(s)
	11.5. Deferral
	11.6. Continued Performance
	11.7. Compelled Arbitration
	11.8. Related Parties and Proceedings

ARTICLE 12.		REPRESENTATIONS



ARTICLE 13.		MISCELLANEOUS PROVISIONS

	13.1. Applicable Law
	13.2. Binding Effect; Assignment
	13.3. Notices
	13.4. Waivers
	13.5. Invalid Provisions
	13.6. Survival
	13.7. Confidentiality
	13.8. Publicity
	13.9. Further Assurances
	13.10. Counterparts/Facsimiles/PDF Copies
	13.11. FERC Acceptance


Northeast Utilities Service Company


The United Illuminating Company


STATE OF CONNECTICUT	)
	)	ss. Berlin
COUNTY OF HARTFORD	)


STATE OF CONNECTICUT	)
	)	ss.
COUNTY OF	)


Signed in the Presence of:		THE UNITED ILLUMINATING COMPANY

	By:
Name:
	Name:
	Title:

Name: