<DOCUMENT>
<TYPE>EX-99.7
<SEQUENCE>8
<FILENAME>file008.txt
<DESCRIPTION>EX A-7 PARTNERSHIP AGREEMENT
<TEXT>

Exhibit A-7

                              PARTNERSHIP AGREEMENT

                            Dated as of July 1, 1990

                                    NORVARCO

                                (General Partner)

                              BANGOR VAR CO., INC.

                                (General Partner)

                                    Creating

                             CHESTER SVC PARTNERSHIP

                          (a Maine General Partnership)


<PAGE>

                                TABLE OF CONTENTS

                                                                            Page

section 1.  Formation and Name.................................................3
section 2.  Definitions........................................................3
section 3.  Conditions to Effectiveness........................................6
section 4.  The Partnership; Purposes; Approval of
            Principal Agreements; Best Efforts.................................6
   4.1   Formation of the Partnership..........................................6
   4.2   Purposes..............................................................6
   4.3   Approval of Principal Agreements......................................6
   4.4   Best Efforts..........................................................7
section 5.  The SVC Facility, SVC Project and
            Construction Budget and Schedule...................................7
   5.1   Description...........................................................7
   5.2   Construction Budget and Schedule......................................8
   5.3   Purchase of SVC Work in Progress......................................8
section 6.  Currency of Payment................................................9
section 7.  Books and Inspection...............................................9
section 8.  Management of the Partnership; Owners' Committee..................11
   8.1   Owners' Committee....................................................11
   8.2   Meetings of Owners' Committee........................................11
   8.3   Delegation of Administrative Authority...............................12
section 9.  Initial Resolution of the Owners' Committee.......................12
section 10. Actions Requiring Unanimous Approval of Owners' Committee.........13
section 11. Reimbursement for Services Provided
            by a Partner, Parent or Affiliate.................................14
section 12. Capital Accounts, Etc.............................................15
   12.1     Capital Accounts..................................................15
   12.2     Definition of Profits and Losses..................................16
section 13. Allocations.......................................................16
section 14. Distributions.....................................................16
section 15. Transfer of Partnership Interests.................................17
   15.1     No Transfer.......................................................17
   15.2     Reorganizations...................................................17
   15.3     Right of First Refusal............................................17
   15.4     Further Requirements..............................................19
   15.5     Distributions and Allocations in Respect to Transferred Interests.20
section 16. Term of Partnership; Dissolution..................................21
   16.1     Term..............................................................21
   16.2     Dissolution.......................................................22
   16.3     Remedies Upon Default.............................................25
section 17. Winding Up of Partnership.........................................26
section 18. Nature of Relationship............................................27
section 19. Insurance and Indemnification ....................................27
section 20. Arbitration.......................................................29
   20.1     General...........................................................29
   20.2     Procedure.........................................................29
   20.3     Costs.............................................................30
   20.4     Enforcement.......................................................30
section 21. Governing Law.....................................................30
section 22. Communications....................................................30
section 23. Benefits; Assignment..............................................31
section 24. All Prior Agreements Superseded...................................32
section 25. Section Headings Not to Affect Meaning............................32
section 26. Severability of Provisions........................................32
section 27. Counterparts......................................................32
section 28. Amendments........................................................32
section 29. Proprietary Information...........................................33

Exhibit A  Construction Budget - Chester Facilities of Partnership
Exhibit B  Unanimous Resolution of Owners' Committee
Exhibit C  Description of Off-Site Facilities
Exhibit D  Cost of SVC Facilities, Transmission Work and Off-Site Facilities

<PAGE>



                              PARTNERSHIP AGREEMENT

     PARTNERSHIP AGREEMENT,  dated as of July 1, 1990, between NORVARCO, a Maine
corporation  ("NORVARCO"),  and  BANGOR  VAR  CO.,  INC.,  a  Maine  corporation
("Bangor").


                              W I T N E S S E T H:

     WHEREAS,  NORVARCO  and Bangor  desire to form a general  partnership  (the
"Partnership")  under  the  laws of the  State  of  Maine  to  design,  license,
construct,  finance,  manage, maintain, own and operate a static var compensator
facility  (as more fully  described  in Section  5.1,  the "SVC  Facility"),  to
provide  the  necessary   transmission  system  reinforcements  to  support  the
Hydro-Quebec HVDC Phase II ("Phase II")  transmission  line expansion  currently
under construction for New England Hydro-Transmission  Corporation ("New England
Hydro"); and

     WHEREAS,  the SVC Facility is to be constructed,  among other reasons,  for
the  purpose of allowing  the Phase II  facilities  to operate at their  maximum
capability  while Maine  Electric  Power Company,  Inc.  ("MEPCo")  continues to
maintain  its  full  operating  capability  on the  MEPCo  345 kv line  from New
Brunswick, Canada; and

     WHEREAS,  pursuant  to the "Phase II Maine  Electric  Power SVC  Facilities
Support  Agreement,"  which became  effective on October 1, 1988,  as amended by
Amendment No. 1 dated as of January 1, 1990 (the "SVC Support Agreement"), MEPCo
has agreed to design,  construct,  operate and maintain the SVC Facility for New
England  Hydro,  acting in its  capacity  as  constructor  of the New  Hampshire
portion of the Phase II facilities; and

     WHEREAS,  MEPCo has agreed,  pursuant to and to the extent set forth in the
Assignment  and  Purchase  and  Sale  Agreement  dated as of July 1,  1990  (the
"Assignment  Agreement"),  to assign  and  delegate  to the  Partnership  all of
MEPCo's rights and obligations  under the SVC Support  Agreement and to transfer
the SVC Facility to the Partnership; and

     WHEREAS,  the  corporate  Parents  of  the  Partners  are  also  two of the
principal shareholders of MEPCo; and

     WHEREAS,  New  England  Hydro  has  agreed to pay,  via a  monthly  support
payment, the total supported costs of services related to the SVC Facility (such
support  payments  being  designed  to equal the  monthly  fixed  costs plus the
monthly operating costs of the SVC Facility); and

     WHEREAS,   pursuant  to  the  Principal   Agreements   (as  defined  below)
substantially all foreseeable  business  decisions  relating to the operation of
the SVC Facility and the business of the Partnership have been established; and

     WHEREAS,  the parties believe that a partnership is the most desirable form
of entity to carry out the SVC Project (as defined below); and

     WHEREAS, this Agreement and the transactions  contemplated hereby have been
approved by the Boards of Directors of NORVARCO and Bangor; and

     WHEREAS,  the Partners  intend to develop a financing  plan,  in connection
with structuring and obtaining financing for the SVC Facility; and

     WHEREAS, the parties believe that the formation of the Partnership pursuant
to  this  Agreement  is in  their  respective  best  interests  and in the  best
interests of carrying out the SVC Project;

     NOW, THEREFORE, the parties hereto,  acknowledging mutual consideration and
intending  to be legally  bound  hereby,  do hereby  agree as  follows:

     SECTION 1. Formation and Name.

     NORVARCO and Bangor hereby form and establish a general  partnership  under
the Maine Uniform  Partnership Act (Title  31,ss.5281-323) to be conducted under
the terms and provisions set forth in this Agreement,  provided that Section 298
of said Act shall be superseded in its entirety by this  Agreement.  The name of
the Partnership  shall be "Chester SVC  Partnership".  NORVARCO and Bangor shall
promptly  prepare and file such  certificates,  notices and other  documents and
shall take all such other action as may be required under Maine law to establish
and/or register such Partnership and the name thereof.

     SECTION 2. Definitions.

     For the purposes of this Agreement,  unless  otherwise  expressly  provided
herein or unless the context otherwise requires,  the following terms shall have
the following respective meanings:

     "ABB" shall mean ABB Power Transmission, Inc., a Delaware corporation.

     "Affiliate"  of  any  Person  shall  mean  any  other  Person  controlling,
controlled by, or under common control with,  such Person.  For purposes of this
definition,  the term "control" (including the correlative meanings of the terms
"controlled  by" and "under common control  with"),  as used with respect to any
Person,  shall mean the  possession,  directly  or  indirectly,  of the power to
direct or cause the direction of the management policies of such Person, whether
through the ownership of voting securities or by contract or otherwise.  Because
neither Partner controls the affairs of the Partnership,  the Partnership is not
an Affiliate of either Partner, nor of the Affiliates of the Partners.

     "Assignment of Construction Contract" shall mean the Assignment,  Amendment
and Consent to Assignment of that name dated as of November 22, 1989, as amended
by Amendment  to  Assignment  dated as of March 15, 1990 among the  Partnership,
MEPCo, New England Hydro and ABB Power Transmission, Inc.

     "Basic Operating  Agreement" shall mean the agreement of that name dated as
of July 1, 1990 between the Partnership and MEPCo.

     "Business  Day" shall mean any date other than (a) a Saturday or Sunday and
(b) a day on which state or national  banking  institutions  are  authorized  or
obligated by law or executive order to remain closed in the State of Maine.

     "Construction  Contract" shall mean that certain  Agreement between ABB and
MEPCo, dated as of November 21, 1988, as amended.

     "Ground  Lease"  shall mean the  agreement of that name dated as of July 1,
1990 between the Partnership and MEPCo.

     "Parent"  shall  mean,  with  respect  to a Partner,  an entity  that owns,
directly or indirectly,  either more than 50% of the outstanding voting stock of
a Partner or more than 50% of the value of the outstanding  stock of all classes
of such Partner.

     "Partners" shall mean each of NORVARCO and [B-H Sub].

     "Person"  shall  mean  any  individual,  partnership,  corporation,  trust,
unincorporated  association or joint venture,  a government or any department or
agency thereof, or any other entity.

     "Principal  Agreements"  shall mean this Agreement,  the Ground Lease,  the
Basic  Operating  Agreement,  the  SVC  Support  Agreement,  the  Assignment  of
Construction Contract and the Assignment Agreement.

     "Prudent  Utility  Practice"  shall at any particular  time mean any of the
practices,  methods and acts which,  in the exercise of  reasonable  judgment in
light of the facts  known at the time the  decision  was made,  could  have been
expected to accomplish the desired result at a reasonable  cost  consistent with
licensing  and  regulatory   considerations,   applicable   law,   environmental
considerations,   reliability,  safety  and  expeditiousness.  "Prudent  Utility
Practice" is not intended to be limited to the optimum practice,  method or act,
to the exclusion of all others, but rather is a spectrum of possible  practices,
methods and acts which could have been expected to accomplish the desired result
at a reasonable cost  consistent  with licensing and regulatory  considerations,
applicable   law,   environmental   considerations,   reliability,   safety  and
expeditiousness.

     "SVC' shall mean static var compensator.

     "SVC Project" shall have the meaning set forth in Section 5.1.

     References  in this  Agreement to sections,  paragraphs  and clauses are to
sections, paragraphs and clauses in this Agreement unless otherwise indicated.

     SECTION 3. Conditions to  Effectiveness.  This Agreement shall be effective
(the "Effective Date") upon execution hereof by the Partners; provided, that, on
such date the SVC Support Agreement is in full force and effect.

     SECTION 4. The  Partnership;  Purposes;  Approval of Principal  Agreements;
Best Efforts.

     4.1  Formation  of the  Partnership.  NORVARCO  and Bangor  have formed and
established the Partnership  under the laws of the State of Maine.  All real and
personal property owned by the Partnership shall be held in its name, and not in
the names of the Partners, and no Partner shall have any individual ownership in
such  property  except  for its  rights as a  Partner  in the  Partnership.  The
principal place of business of the Partnership  shall be Edison Drive,  Augusta,
Maine.

     4.2 Purposes. The purpose of the Partnership is limited to the SVC Project.

     4.3 Approval of Principal  Agreements.  The Principal Agreements are hereby
acknowledged  by the  Partners  to be fair to the  Partnership,  and are  hereby
approved by the Partnership and by the Partners.

     4.4 Best  Efforts.  Each of the  Partners  agrees  to take  all  reasonably
necessary and desirable actions, and to exercise its reasonable best efforts, to
accomplish the SVC Project.

     SECTION  5. The SVC  Facility,  SVC  Project  and  Construction  Budget and
Schedule.

     5.1 Description. The SVC Facility shall consist of the following:

          (a) a  substation  which  shall  house  equipment  such as 345 kv line
     disconnect  switches,  a  345  kv  circuit  breaker,   345/18  kv  stepdown
     transformers, a microwave tower, antenna, capacitor banks, cooling systems,
     metal  control house and other  equipment  all as further  described in the
     Construction Contract; and

          (b) all property (real,  personal and mixed,  tangible and intangible)
     related to the SVC Facility,  acquired or created by the  Partnership.

     The SVC Project  shall mean the  activities  contemplated  by the terms and
conditions of this Agreement,  the SVC Support Agreement and the Basic Operating
Agreement in connection  with  designing,  licensing,  constructing,  financing,
managing, maintaining, owning and operating the SVC Facility, including, but not
limited  to, the  following:

          (a) the  selection  and  training  of the  staff  to  operate  the SVC
     Facility:

          (b) the  selection  and  procurement  of all  materials  and  supplies
     necessary  to  construct  the SVC  Facility  and to commence  and  maintain
     commercial operation thereof;

          (c) the operation and maintenance of the SVC Facility;

          (d) all matters  incidental to the foregoing  which,  consistent  with
     Prudent  Utility  Practice,  should be done to prepare and maintain the SVC
     Facility for commercial operation on a continuous basis; and

          (e) any activities ancillary and reasonably related to the foregoing.

     5.2  Construction  Budget and  Schedule.  The  Partners  have agreed to the
Construction  Budget and  Schedule  for the SVC  Facility  attached as Exhibit A
hereto.

     5.3  Purchase  of SVC Work in  Progress.  ABB has  substantially  completed
construction  of the SVC  Facility  pursuant to the  Construction  Contract.  In
addition,  MEPCo has substantially completed certain transmission facilities and
interconnection  facilities  in MEPCo's 345 kv right of way  adjacent to the SVC
Facility, consisting of two new transmission towers and lines connecting the 345
kv line to the SVC (the  "Transmission  Work").  MEPCo owns the work in progress
under  the  Construction  Contract,  the  Transmission  Work and  certain  other
off-site  facilities  being  constructed  by  MEPCo  relating  to  SVC  Facility
microwave communication and control and other off site facilities,  as described
in Exhibit C attached  hereto (the "Off Site  Facilities").  The Partners hereby
agree  that the  Partnership  shall  purchase  such work in  progress  under the
Construction   Contract  and  the  Transmission  Work,  but  not  the  Off  Site
Facilities,  from MEPCo in consideration of assumption of MEPCo's obligations to
reimburse New England Hydro under the SVC Support Agreement for costs of the SVC
Facility,  and the Transmission  Work, all as more fully set forth in Exhibit D.
In consideration of the Partnership's  assumption of the obligation to reimburse
New England Hydro for costs of the Off Site Facilities, MEPCO shall, pursuant to
the Basic  Operating  Agreement,  assume  and agree to pay the  Partnership  any
amounts  that the  Partnership  must pay to New  England  Hydro with  respect to
advances  to  fund   construction   of  the  Off  Site   Facilities.   All  such
reimbursements  (MEPCO to the  Partnership  and the  Partnership  to New England
Hydro) shall be  simultaneous  at closing of financing  for the SVC  Facilities.

     SECTION  6.  Currency  of  Payment.  All  amounts  required  to be  paid or
contributed to the  Partnership  under this  Agreement  shall be payable in U.S.
dollars. Such payments or contributions shall be made by wire transfer to a bank
account designated by the Owners' Committee of the Partnership, or in such other
manner as is satisfactory to the Owners' Committee of the Partnership.

     SECTION 7. Books and  Inspection.  The  Partnership  shall  maintain at its
principal  place of business  accurate  and complete  books and records,  on the
accrual basis,  in accordance  with  generally  accepted  accounting  principles
consistently applied, showing all costs,  expenditures,  sales, receipts, assets
and  liabilities,  and  profits  and losses,  and all other  records  necessary,
convenient or incidental to recording the Partnership's business and affairs.

     Each  Partner  or its  designated  representatives  shall have the right of
inspection and verification  of, and, for such purpose,  shall at all reasonable
times have free access to, the books, accounts, records and all other supporting
records and documents of the  Partnership  for any year,  or shorter  accounting
period in such year,  at any time  within  the  twenty-four  (24)  month  period
following the end of such year;  provided,  however,  that the Partnership shall
not be required to make any  adjustments,  as to any Partner,  unless and to the
extent that such Partner  took  written  exception to the books and accounts and
made a claim upon the Partnership for any discrepancies  disclosed by said audit
within  such  twenty-four  (24) month  period.  The  expenses of all such audits
conducted  at the  request  of a Partner  shall be borne  solely by the  Partner
requesting the audit.

     The books,  records and other documents of the Partnership shall be audited
at  least  annually  by a  nationally  recognized  firm  of  independent  public
accountants selected by the Partners.

     7.1 Records.  As promptly as practicable and not later than one hundred and
twenty  (120) days after the end of each  fiscal  year of the  Partnership,  the
Partnership  shall  furnish to each of the Partners an annual report which shall
include the Partnership's audited comparative statements of income, statement of
cash flows,  balance sheets and statements of partnership  equity for, and as of
the end of, the fiscal year then ended and any additional financial  information
that any Partner may reasonably require. The Partnership shall make available to
each  Partner,  as they become  available,  regular  reports and other  relevant
information  with  respect  to the  cost of the SVC  Project,  the  progress  of
construction and all items affecting payments or contributions to be made by the
Partners or which such Partner may reasonably require.

     Promptly  after the end of each quarter of the  Partnership's  fiscal year,
the  Partnership  shall  cause  to be  prepared  a  balance  sheet  showing  the
Partnership's  assets  and  liabilities  as of the close of such  quarter  and a
statement  of income and a  statement  of cash flows  showing the results of its
operations for such quarter.

     SECTION 8. Management of the Partnership; Owners' Committee.

     8.1 Owners' Committee.  The business of the Partnership shall be managed by
the Partners.  The Partners shall act through an Owners' Committee consisting of
one (1) representative of each Partner,  designated,  from time to time, by each
Partner by  resolutions  of its  respective  board of  directors.  A Partner may
designate, from time to time, one or more alternates to serve as a member of the
Owners'  Committee in the event of the absence or  unavailability of the initial
designee of a Partner. Any member of the Owners' Committee may call a meeting of
said Committee.

     8.2  Meetings  of  Owners'  Committee.  Regular  meetings  of  the  Owners'
Committee shall be held at least  semi-annually,  at such time and at such place
as the Owners'  Committee  shall  determine,  upon at least  fourteen (14) days'
telephonic  notice to all  members.  Special  meetings of the Owners'  Committee
shall be held on the call of any  member at such  time and at such  place as the
Owners'  Committee  shall  determine,  upon at least seven (7) days'  telephonic
notice to all  members.  Members  may vote in person  or by proxy.  The  Owners'
Committee may act without a meeting if the action taken is unanimously  approved
in  writing.  The  Owners'  Committee  may meet by  telephone.  The  presence or
telephonic attendance of members of the Owners' Committee representing interests
in  excess  of 50% of the  outstanding  interests  in the  Partnership  shall be
required  to  constitute  a quorum,  and,  unless  otherwise  specified  in this
Agreement, all actions of the Owners' Committee shall be taken by majority vote.

     8.3 Delegation of Administrative  Authority.  The Owners' Committee may, by
majority  vote,  delegate to one of the Partners  authority to carry out certain
administrative  functions of the business of the  Partnership  for a time period
specified in a resolution of the Owners'  Committee,  and such resolution  shall
remain in full force and effect for the time  period  specified  therein  unless
earlier revoked by a majority vote of the Owners' Committee.

     SECTION 9. Initial Resolution of the Owners' Committee.

     The Partners agree that they shall cause the Owners' Committee to adopt the
Initial  Resolution  attached  hereto as Exhibit B on the Effective Date of this
Agreement.

     SECTION 10. Actions Requiring Unanimous Approval of Owners' Committee. Each
of the following  actions  shall  require the unanimous  approval of the Owners'
Committee:

          (a)  Authorizing  the  borrowing  of money,  including  obtaining  the
     initial long-term financing for the SVC Facility;

          (b)  Authorizing  the Partnership to engage in any business other than
     that referred to in Section 4.2 hereof;

          (c)   Authorizing  the  sale  or  disposition  of  any  asset  of  the
     Partnership  that would  materially  impair or change the  business  of the
     Partnership as contemplated by this Agreement;

          (d) Authorizing contracts and transactions between the Partnership and
     any  Partners,   Parents  and  Affiliates  of  Partners,   (other  than  as
     contemplated in the Principal  Agreements)  including renewals of the Basic
     Operating Agreement;

          (e) Authorizing any amendments to the Principal Agreements;

          (f) Authorizing the Partnership to make or incur capital  expenditures
     in any fiscal year in excess of $100,000;

          (g) Authorizing  the  Partnership to guaranty the  indebtedness of any
     Person;

          (h) Authorizing  the Partnership to enter into any security  agreement
     or mortgage encumbering assets of the Partnership;

          (i) Approving an annual budget for the Partnership;

          (j) Selecting or varying depreciation or accounting methods, or making
     other decisions with respect to the treatment of various  transactions  for
     state and/or federal income tax purposes,  or other financial  purposes not
     otherwise  specifically provided for herein, except with respect to matters
     that  under  state  and/or  federal  tax  law are to be  determined  by the
     election of partners  rather than  determined  uniformly at the partnership
     level for all partners; and

          (k)  Releasing  any news  release,  interview  or other  publicity  or
     written  document to any newspaper,  radio,  television,  magazine or other
     segment of the media,  except as may be required of any Partner in order to
     comply with state or federal  securities  laws or  regulations or the rules
     and  regulations of any securities  exchanges or other markets with respect
     to any publicly traded securities of any Partner or Affiliate of a Partner.
     If a Partner  determines that such a release or public  disclosure does not
     require  unanimous  approval  of the  Owners'  Committee  by reason of this
     subsection,  such Partner  shall inform the other Partner of the nature and
     content of such  release or public  disclosure  three (3)  working  days in
     advance of such release or public disclosure.

     SECTION 11.  Reimbursement  for Services  Provided by a Partner,  Parent or
Affiliate.  Except as otherwise provided in the Basic Operating  Agreement,  any
employee  of a Partner or any  employee  of its Parent or  Affiliate  who at the
request of the Owners'  Committee,  or its delegate under Section 8.3,  provides
services to the Partnership shall be paid by the Partner, Parent or Affiliate by
which such employee is employed.  The Partnership  shall reimburse such Partner,
Parent or  Affiliate  for the cost of such  employee's  services  (inclusive  of
direct and indirect  costs,  properly  allocable  overhead,  and the cost of any
equipment or supplies).

     SECTION 12. Capital Accounts, Etc.

     12.1  Capital  Accounts.  There  shall be  established  for each  Partner a
Capital  Account.   The  Partners  Capital  Accounts  shall  be  determined  and
maintained in accordance with the capital account  maintenance rules of Treasury
Regulation ss.1.704-1(b)(2)(iv), which are incorporated herein by reference, and
in general  shall be  increased by (i) the amount of money  contributed  by such
Partner, (ii) the fair market value of property contributed by such Partner (net
of  liabilities  secured by such  contributed  property that the  Partnership is
considered to assume or take subject to), (iii) the amount of Profits  allocated
to such Partner,  and (iv) the amount of any Partnership  liabilities assumed by
such  Partner,  and in  general  shall be  decreased  by (i) the amount of money
distributed to such Partner,  (ii) the fair market value of property distributed
to such Partner (net of liabilities  secured by such  distributed  property that
such Partner is  considered  to assume or take subject to),  (iii) the amount of
Losses allocated to such Partner, and (iv) the amount of any liabilities of such
Partner assumed by the Partnership.

     12.2  Definition of Profits and Losses For purposes of  allocating  Profits
and Losses to Capital  Accounts,  "Profits" and "Losses"  mean,  for each fiscal
year or other period,  an amount equal to the  Partnership's  taxable  income or
loss for such year or period for federal income tax purposes, as modified by the
capital account maintenance rules of Treasury Regulation ss.1.704-1(b)(2)(iv).

     This Section 12.2 and the other  provisions of this  Agreement  relating to
the  maintenance  of Capital  Accounts  are  intended  to comply  with  Treasury
Regulation  ss.1.704-1(b)  and  shall be  interpreted  and  applied  in a manner
consistent with such Treasury Regulation.  section 13. Allocations. For purposes
of  maintaining  Capital  Accounts,  Profits and Losses  shall be  allocated  as
follows:

                           NORVARCO                  50%
                           Bangor                    50%

For federal income tax purposes,  all items of income, gain, loss, deduction and
credit shall be allocated as follows:

                           NORVARCO                  50%
                           Bangor                    50%

     SECTION 13.  Allocations.  For purposes of  maintaining  Capital  Accounts,
Profits and Losses shall be allocated as follows:

                           NORVARCO                  50%
                           Bangor                    50%

For federal income tax purposes, all items of income, gain, loss, deduction and
credit shall be allocated as follows:

                           NORVARCO                  50%
                           Bangor                    50%

     SECTION 14. Distributions. The amount of cash available for distribution to
the Partners  shall be determined  at the end of each year by the Partners.  All
amounts distributed to the Partners shall be distributed 50% to NORVARCO and 50%
to Bangor.  The Partners  agree that to the extent  available,  the  Partnership
shall at least make  equitable  and  timely  quarterly  distributions,  in equal
amounts to each Partner,  to allow each Partner to pay such Partner's  estimated
income tax liability (federal and state) resulting from such Partner's allocable
share of Partnership income.

     SECTION 15. Transfer of Partnership Interests.

     15.1 No Transfer. Except as authorized in this Section 15, no Partner shall
sell,   transfer,   assign  or  otherwise  dispose  of,  or  mortgage,   pledge,
hypothecate,  create a security interest in, or otherwise encumber, or permit or
suffer any encumbrance of (collectively,  a "Transfer"),  all or any part of its
Interest  in  the  Partnership   (hereinafter  referred  to  as  a  "Partnership
Interest"),  unless approved in writing by the other Partner, and any attempt to
do so without such approval shall be void.

     15.2 Reorganizations.  For the purposes of this Section 15, a transfer by a
Partner of its entire  Partnership  Interest to an Affiliate of a Partner  shall
not be deemed a Transfer;  provided, however, that: (a) the transferring Partner
(together with its Affiliate transferee) shall remain liable for its obligations
as a  Partner  under  this  Agreement,  and  (b)  all  of  the  requirements  of
subsections  15.4(b)  through 15.4(g) shall be satisfied in connection with such
transfer.

     15.3 Right of First Refusal.

          (a) Except as otherwise  provided in Section 15.1 and 15.2 hereof,  no
     partner shall Transfer all or any part of its Partnership Interest,  except
     pursuant to a bona fide written  offer for cash from a party that is ready,
     willing and able to acquire the  Partnership  Interest after the expiration
     of the periods for giving notices  specified in clauses (c) and (d) of this
     Section  15.3,  and  then  only if an  offer to  Transfer  the  Partnership
     Interest to the other Partner upon identical  terms has first been made and
     has not been accepted, as hereinafter provided.

          (b) At least 6 months  prior to its  intended  date of  Transfer,  and
     after its receipt of a bona fide  written  offer of the type  described  in
     clause (a) of this  Section  15.3,  the Partner  desiring  to Transfer  its
     Partnership Interest shall give written notice of its intention to do so to
     the other  Partner,  which  notice  shall  contain the name of the proposed
     purchaser, the approximate date of the proposed Transfer, and the terms and
     conditions of the bona fide written offer.

          (c) The other  Partner  shall  signify  its  intention  to acquire the
     entire Partnership  Interest, or not acquire all thereof, by giving written
     notice of its intention to the transferring  Partner.  Failure of a Partner
     to serve such notice  within 90 days after the date of the giving of notice
     pursuant to clause (b) of this Section 15.3 shall be deemed conclusively to
     be notice of its intention not to acquire the Partnership Interest.

          (d) Any  Transfer of the  Partnership  Interest  to the other  Partner
     shall be fully  consummated  within 12 months following the date upon which
     the last of the notices  required to be given under this  Section  15.3 has
     been  duly  served,   unless  the  Partner  is  then  diligently   pursuing
     applications   to   appropriate   regulatory   authorities   for   required
     authorizations to consummate the Transfer,  in which case the time for such
     consummation shall be extended until 30 days after the proceedings for such
     authorizations are completed and such authorizations have been obtained and
     have  become  final  (i.e.,  the time for appeal  therefrom  has expired or
     appeals therefrom have been completed).

          (e) If the other  Partner does not  indicate,  within the time periods
     specified  in this  Section  15.3,  an  intention  to  acquire  the  entire
     Partnership  Interest,  the Partner desiring to Transfer shall,  subject to
     the  provisions  of this  Section 15, be free to Transfer  all but not less
     than all of the  Partnership  Interest to the party that made the bona fide
     written offer upon the terms and conditions set forth in such offer.

     15.4  Further  Requirements.  No  Transfer  of a part  of  the  Partnership
Interest  of  a  Partner  shall  be  permitted,  effective  or  binding  on  the
Partnership  or  the  non-transferring  Partner.  No  Transfer  of  all  of  the
Partnership  Interest of a Partner shall be  permitted,  effective or binding on
the Partnership or the non-transferring  Partner unless (a) the admission of the
transferee  as a new  Partner  shall  have been  consented  to in writing by the
non-transferring  Partner, which consent shall not be unreasonably withheld, (b)
the  transferee  shall  execute  and  acknowledge  an  instrument,  in form  and
substance reasonably  satisfactory to the non-transferring  Partner,  whereby it
agrees to assume and be bound by all the covenants, terms and conditions of this
Agreement as the same may have been amended,  including, but not limited to, the
financial and other  obligations  of its transferor  hereunder,  (c) a duplicate
original of each such instrument of Transfer and  assumption,  duly executed and
acknowledged in each case, is delivered to the non-transferring Partner, (d) the
transferor  shall  provide  an  opinion of  counsel,  satisfactory  to the other
Partner,  that the  proposed  Transfer  would not cause the  termination  of the
Partnership  for  federal  income  tax  purpose,  unless the  remaining  Partner
consents to such a  termination,  (e) the  transferee  shall pay all  reasonable
expenses  in  connection  with its  admission  as a  Partner,  (f) all  required
consents  of  mortgagees  or other  Persons  to such  transfer  shall  have been
obtained in writing and delivered to the  non-transferring  Partner, and (g) all
required  consents  thereto or approvals  thereof,  if any, of all  governmental
authorities  having  jurisdiction shall have been obtained and have become final
and written notice thereof delivered to the non-transferring Partner.

     15.5 Distributions and Allocations in Respect to Transferred Interests.  If
any  Partnership  Interest in the  Partnership is sold,  assigned or transferred
during any accounting  period in compliance  with the provisions of this Section
15,  Profits,  Losses  and  all  other  items  attributable  to the  transferred
Partnership  Interest for such period shall be divided and allocated between the
transferor  and the  transferee by taking into account  their varying  interests
during the period in accordance with Code Section 706(d),  using any conventions
permitted  by law.  Solely  for the  purposes  of making  such  allocations  and
distributions,  the Partnership shall recognize such transfer not later than the
end of the calendar month during which it is given notice that such transfer has
been made,  provided that if the Partnership does not receive notice stating the
date such interest in the Partnership was transferred and such other information
as the Owners' Committee may reasonably  require within 30 days after the end of
the accounting  period during which the transfer occurs,  then all of such items
shall be  allocated,  and all  distributions  shall be made,  to the person who,
according  to the books and records of the  Partnership,  on the last day of the
accounting  period  during  which  the  transfer  occurs,  was the  owner of the
interest.  Neither the Partnership nor the Administrative  Agent shall incur any
liability  for making  allocations  and  distributions  in  accordance  with the
provisions  of this  Section  15,  whether or not the Owners'  Committee  or the
Partnership has knowledge of any transfer of ownership of any interest.

     SECTION 16. Term of Partnership; Dissolution.

     16.1  Term.  The  term of the  Partnership  shall  commence  on the date of
effectiveness of this Agreement as provided in Section 3 hereof.  Subject to the
provisions  hereof  regarding  dissolution,  the term of the  Partnership  shall
continue until the earliest of: (a) sale or other disposition of the SVC Project
by the Partnership,  (b) 55 years after the date hereof, or (c) five years after
termination of the SVC Support Agreement, and payment in full of all amounts due
from New England Hydro to the Partnership  unless the Partners  otherwise agree.
Neither  Partner shall have the right  voluntarily  to dissolve or terminate the
Partnership at any time,  including without limitation any rights under the laws
of the State of Maine to apply for judicial dissolution, and the only right of a
Partner unilaterally to withdraw from the Partnership shall be through a sale of
its  entire  interest  in the  Partnership  in  accordance  with the  provisions
contained in Section 15.

     16.2  Dissolution.  The  Partnership  may be  dissolved as provided in this
Section 16 upon the  occurrence  of an Event of Default.  Each of the  following
shall constitute an Event of Default:

          (a)  The  withdrawal  of  either  Partner  in   contravention  of  the
     provisions of this Agreement;

          (b) The entry of a decree or order by a court having  jurisdiction  in
     the premises adjudging a Partner or its Parent a bankrupt or insolvent,  or
     approving as properly filed an involuntary petition seeking reorganization,
     arrangement, adjustment or composition of or in respect of a Partner or its
     Parent under any  bankruptcy,  insolvency,  or other similar law,  state or
     federal,  or  appointing  a  receiver,   liquidator,   assignee,   trustee,
     sequestrator (or other similar official) of the Partner or its Parent or of
     any  substantial  part of the property of a Partner or its Parent under any
     such law, or ordering  the  winding up or  liquidation  of the affairs of a
     Partner or its Parent,  and the  continuance of any such decree or order is
     unstayed and in effect for a period of 90 consecutive days; or

          (c)  the  institution  by  a  Partner  or  its  Parent  of  bankruptcy
     proceedings  or  other   proceedings  to  be  adjudicated  as  bankrupt  or
     insolvent,  or the consent by a Partner or its Parent to the institution of
     bankruptcy or insolvency  proceedings  against a Partner or its Parent,  or
     the  filing of a  petition  or answer or consent by a Partner or its Parent
     seeking reorganization or relief under any bankruptcy, insolvency, or other
     similar law, state or federal, or the consent by a Partner or its Parent to
     the  filing  of  such  petition  or  to  the  appointment  of  a  receiver,
     liquidator,  assignee,  trustee,  sequestrator (or similar official) of the
     Partner  or its  Parent or of any  substantial  part of the  property  of a
     Partner or its Parent under any such law, or the making by a Partner or its
     Parent of an assignment for the benefit of creditors, or the admission by a
     Partner  or its  Parent  in  writing  of its  inability  to pay  its  debts
     generally  as they  become  due,  or the  taking of  corporate  action by a
     Partner or its Parent in furtherance of any such action; or

          (d) any part of the  Partnership  Interest of a Partner is seized by a
     creditor of such  Partner,  and the same is not  released  from  seizure or
     bonded out within 60 days from the date of notice of seizure; or

          (e) a Partner violates Section 15 hereof.

Upon the  occurrence  of an Event of Default  with  respect  to a Partner,  such
Partner  shall be deemed to be in default  hereunder and shall be referred to as
the  "Defaulting  Partner",  and the other  Partner  shall be referred to as the
"Non-Defaulting Partner".

     Upon the  occurrence  of any of the events  specified  in  subsections  (a)
through (e) of this Section  16.2,  the  Defaulting  Partner  shall  provide the
Non-Defaulting  Partner with prompt  written  notice of the  occurrence  of such
default;  provided,  however, that notwithstanding any failure of the Defaulting
Partner to provide such written  notice,  upon the occurrence and continuance of
any of the events  specified  in  subsections  (b),  (c), or (d) of this Section
16.2, the Non-Defaulting Partner shall immediately, and without the necessity of
taking any further action,  have the right to exercise the remedies set forth in
Section 16.3 hereof.  Upon the occurrence  and  continuance of any of the events
specified in  subsection  (a) or (e) of this Section  16.2,  the  Non-Defaulting
Partner  shall  have the  right to give the  Defaulting  Partner  a  "Notice  of
Default",  which shall be in writing,  shall set forth the obligations which the
Defaulting  Partner has not  performed,  or is in breach of, and shall set forth
the date by which such  default  must be cured,  which date shall be at least 10
days after receipt of the Notice of Default if payment of money is required,  or
at least 30 days after receipt of the Notice of Default for defaults  other than
payments of money,  or such shorter period as may be necessary in the good faith
judgment of such Non-Defaulting Partner to prevent a default under any agreement
for borrowed money to which the Partnership is a party or to avoid  jeopardizing
their respective investments in the Partnership. If, within the period specified
in the Notice of Default,  the Defaulting Partner cures such default, the Notice
of Default shall be inoperative and the Defaulting  Partner shall lose no rights
hereunder.  If, within such specified  period,  the Defaulting  Partner does not
cure such default, any Non-Defaulting Partner, at the expiration of such period,
shall have the rights hereinafter specified.

     16.3  Remedies  Upon  Default.  If a Partner  becomes a Defaulting  Partner
pursuant to the  provisions  of Section 16.2 hereof and the default is not cured
within the specified,  if any, period,  then, in such event, the  Non-Defaulting
Partner shall have the right, at its option, to proceed to either:

          (a) dissolve the Partnership; or

          (b) cure the default and the cost of such curing shall be  recoverable
     from the Defaulting Partner;  provided that neither action under clause (a)
     or clause (b) shall  relieve the  Defaulting  Partner  from  liability  for
     damages sustained by the Partnership or by the Non-Defaulting Partner

     SECTION 17. Winding Up of Partnership. Except as otherwise provided in this
Agreement,  upon  termination of the  Partnership as provided in Section 16.1 or
dissolution of the Partnership as provided in Section 16.2-3,  the assets of the
Partnership,  after payment of  liabilities,  shall be distributed in accordance
with the respective capital accounts of the Partners, as adjusted for unrealized
gain or loss, in the following manner:

          (a) All  Partnership  liabilities  shall  be paid and  discharged,  or
     adequate funds set aside for the payment and discharge thereof,  all out of
     the Partnership's  cash; if the amount thereof is not sufficient to provide
     for such  discharge of  obligations,  tangible  personal  property and real
     property and other property (in that order to the extent feasible) shall be
     sold in order to realize additional cash (with either Partner, other than a
     Defaulting Partner,  having the right of first refusal, for a period of not
     more than 30 days from the receipt of a third party offer to  purchase,  to
     purchase such assets at the same price and an the same terms and conditions
     as such third party offer). If the Partnership  retains reserves reasonably
     required  to provide  for  liabilities  (contingent  or  otherwise)  of the
     Partnership or retains  installment  obligations  owed to the  Partnership,
     liquidating  distributions  shall  be made in the  ratio  of the  Partners'
     positive Capital  Accounts,  and such retained amounts shall be distributed
     as soon as practicable and in the ratios of the Partners'  positive Capital
     Account  balances.  In the event that the  liabilities  of the  Partnership
     cannot be fully  satisfied  and  discharged  after the sale or sales of all
     assets,  the Partners  shall assume and pay the excess in  accordance  with
     their  respective  applicable  allocation  percentage  for loss;  provided,
     however,  that if the capital  account of one or both of the  Partners,  as
     adjusted  for such sale or sales of all  assets,  shall be  negative,  such
     Partner shall first  contribute to the  Partnership  an amount equal to the
     negative balance of its Capital Account.  Any such payment will be credited
     to such Partner's capital account.  Notwithstanding  anything herein to the
     contrary,  the  provisions of this  Subsection  (a) are meant to define the
     respective  rights and duties of the  Partners and shall not give any third
     parties any rights against the Partners.

          (b) The  Partnership  shall  terminate  when all property owned by the
     Partnership shall have been disposed of and the net proceeds, after payment
     or  satisfaction of liabilities to Partnership  creditors,  shall have been
     distributed to the Partners.

     SECTION 18. Nature of  Relationship.  Nothing  herein shall be construed to
constitute  either Partner the agent or general partner of the other,  except as
provided herein.

     SECTION 19. Insurance and Indemnification.

     19.1 The Partnership  shall procure and maintain,  at Partnership  expense,
programs of  insurance  coverage,  including  but not  limited to  comprehensive
public liability, property damage, product liability, fidelity, theft, burglary,
workmen's compensation, and business interruption insurance, with such companies
and such terms, limits and deductibles as the Owners' Committee, or its delegate
under Section 8.3, from time to time shall  determine.  Both the Partnership and
the Partners shall be named insureds thereunder.

     19.2 All claims,  demands,  actions,  and rights of action of third parties
with respect to the business of the Partnership,  and costs and fees incident to
the  investigation,   defense  and  settlement  of  the  same,  are  hereinafter
collectively  referred to as "loss." All loss sustained by the Partnership  with
respect to which the Partnership is uninsured shall be borne by the Partnership.
In the event a loss on account of Partnership  activities is sustained by either
Partner,  it shall be entitled  to  reimbursement  thereof  and/or to being held
harmless  by the  Partnership;  provided  that such loss is not due to the gross
negligence, willful act or willful omission of such Partner or its employees, or
an act which is  outside  of the  authority  of such  Partner  pursuant  to this
Agreement or which contravenes any of the provisions of this Agreement.

     19.3 Each  Partner  shall  notify the other  promptly of the  existence  or
probable  existence  of any claim or demand  or right of action  against  it and
shall  give  the  other  or  the  Partnership,   as  appropriate,  a  reasonable
opportunity to participate in the defense thereof,  provided the failure to give
such notice shall not affect the right to such recovery  except to the extent of
actual prejudice resulting therefrom.

     SECTION 20. Arbitration.

     20.1 General. All disputes, claims and other matters in question between or
among the  Partners,  shall be  decided  by  arbitration  as  described  in this
section. Unless the parties agree otherwise, the arbitration proceeding shall be
conducted before a three person arbitration panel. The arbitrators,  all of whom
shall be neutral  arbitrators,  shall be appointed  by the American  Arbitration
Association ("AAA") upon application by any one of the Partners. All arbitrators
appointed  shall be individuals  experienced in the electric  utility  industry,
with particular  reference to the matter in question to the extent possible.  No
arbitrator shall be challenged  except for cause. No more than one member of the
arbitration  panel  may be an  attorney.  The AAA may  consult  with the  Edison
Electric Institute when selecting arbitrators.

     20.2 Procedure. Notice of Demand for Arbitration shall be sent to the other
Partners  by  certified  mail  and a copy  sent  to  the  AAA.  The  arbitration
proceeding  shall be conducted in  accordance  with the  Commercial  Arbitration
Rules of the  American  Arbitration  Association  as amended  from time to time,
consistent with this Section 20.

     During the course of the  arbitration,  the parties  shall he  permitted to
demand and receive  from one another the  documents  one would be  permitted  to
obtain in a civil  action in  Superior  Court.  The parties  shall also  furnish
detailed  reports of any  outside  expert  witnesses  whom they intend to call a
reasonable time in advance of the arbitration  hearings.  The arbitrators  shall
enforce the provisions of this section as part of the agreement to arbitrate and
shall  further have the  authority to permit and require  depositions  of expert
witnesses.  No dispute may be submitted to arbitration more than two years after
it arises,  except by mutual agreement of the parties.  The arbitration shall be
held in Augusta, Maine, unless otherwise agreed.

     20.3 Costs.  The  Partners  shall share  equally the costs and fees of such
arbitration and further agree that said costs shall include  compensation to the
arbitrators for their time spent in arriving at their determination.

     20.4 Enforcement.  The award rendered by the arbitrators shall be final and
binding and judgment may be entered upon the award in accordance with applicable
law in any court of competent  jurisdiction.  This agreement to arbitrate  shall
survive termination of this Partnership Agreement.

     SECTION 21. Governing Law.

     This  Agreement  shall be governed by and construed in accordance  with the
laws of the State of Maine.

     SECTION 22. Communications.

     Except as otherwise  provided herein or as the parties may otherwise agree,
any notice,  request or other communication from one party to another,  relating
to this  Agreement  or the rights,  obligations  or  performance  of the parties
hereunder, shall be in writing and shall be effective upon delivery to the other
party.  Any  such  communication  shall be  considered  as duly  delivered  when
delivered in person, when received by telex, telecopy or other wire transmission
or upon the lapse of 48 hours after  mailing by  registered  or certified  mail,
postage prepaid, to the address of the other party set forth below:

                   If to NORVARCO:

                   NORVARCO
                   c/o Central Maine Power Company
                   Edison Drive
                   Augusta, Maine  04336
                   Attn:  Donald Kelly
                          Senior Vice President

                   If to Bangor:

                   Bangor Var Co., Inc.
                   c/o Bangor Hydro-Electric Company
                   33 State Street
                   P.O. Box 932
                   Bangor, Maine  04401
                   Attn:  Carroll R. Lee

     Any Partner may at any time by written  notice to the other Partner  change
the address to which notices or communications shall be sent.

     SECTION 23. Benefits; Assignment.

     The rights and  obligations  provided by this  Agreement are for the mutual
benefit of the Partnership  and the Partners,  and shall not be deemed to be for
the benefit of, and may not be enforced  by, any other  Person.  This  Agreement
shall be binding  upon and shall inure to the  benefit of, and may be  performed
by, the successors  and assigns of the parties,  except that no Transfer of this
Agreement or any right or obligation hereunder by any parties shall be effective
except as provided in Section 15.

     SECTION 24. All Prior Agreements Superseded.

     Upon the Effective  Date,  this Agreement  represents the entire  agreement
between the Partners  relating to the subject  matter  hereof,  and all previous
agreements, discussions,  communications and correspondence between or among the
Partners with respect to the subject matter hereof are hereby superseded and are
of no further force and effect.

     SECTION 25. Section Headings Not to Affect Meaning.

     The  descriptive  headings of the various  sections of this  Agreement have
been inserted for  convenience  of reference  only and shall in no way modify or
restrict any of the terms or provisions hereof.

     SECTION 26. Severability of Provisions.

     If any word, phrase, clause,  article, or other provision of this Agreement
is or is deemed or adjudicated  or otherwise  found to be against public policy,
void or otherwise  unenforceable,  then said word,  phrase,  clause,  article or
other provision shall be deleted or modified, in keeping with the express intent
of the parties hereto, as necessary to render all the remainder of the Agreement
valid and enforceable.

     SECTION 27. Counterparts.

     This Agreement may be executed  simultaneously in two or more counterparts,
each of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.

     SECTION 28. Amendments.

     Any  amendments  to this  Agreement  shall be in writing  and signed by all
Persons who are Partners of the Partnership at the time of the amendment

     SECTION 29. Proprietary Information.

     All  information  relating  to the  methods of  operation,  trade  secrets,
technology  or  other   matters   proprietary   to  any  Partner   ("Proprietary
Information"),   whether  in  the  form  of  drawings,  specifications,   patent
applications,  other documents or disclosed  orally,  which becomes known to the
other Partner in connection with the Partnership, shall be held in confidence by
such other Partner,  and such Partner shall treat such information with the same
degree of care it accords its own secret,  proprietary information.  Information
shall not be deemed to be Proprietary  Information  where:  (i) it is or becomes
public information or otherwise generally available to the public through no act
of the recipient; (ii) it is, prior to disclosure hereunder,  already rightfully
in the possession of the recipient or its Affiliates and was not received by the
recipient  directly or indirectly from the disclosing Partner or its Affiliates;
(iii) it is hereafter  rightfully  received by the recipient from a third person
who did not receive the same directly or indirectly from the disclosing  Partner
or  its  Affiliates;  or  (iv)  it is at any  time  independently  developed  by
employees  or  consultants  of the  Partner or its  Affiliates  who have not had
access to the  Proprietary  Information  in the possession of the Partner or its
Affiliates.  The  recipient  has the burden of proving  that such  employees  or
consultants  have  not  had  access  to the  Proprietary  Information.  Specific
information shall not be deemed to be within the exceptions of subparts (i)-(iv)
merely  because  it  is  embraced  by  more  general   information  within  such
exceptions,  nor shall a  combination  of  features  be deemed to be within such
exceptions  merely because the individual  features are within such  exceptions.
The  provisions  of this section shall not apply to any Partner to the extent it
receives  Proprietary  Information  from  another  Partner that is governed by a
separate Confidentiality Agreement between two or more Partners.

     IN WITNESS  WHEREOF,  the parties  have  executed  this  Agreement by their
respective  officers  thereunto  duly  authorized  as of the  date  first  above
written.

                                    NORVARCO

                                    By:  Donald F. Kelly (signed)
                                         ____________________________
                                         Name:
                                         Title:  President


                                    BANGOR VAR CO., INC.

                                    By:  Carroll R. Lee (signed)
                                         ____________________________
                                         Name:
                                         Title:  President


<PAGE>


                       EXHIBIT A TO PARTNERSHIP AGREEMENT

             CONSTRUCTION BUDGET - CHESTER FACILITIES OF PARTNERSHIP
                               CHESTER SVC PROJECT
                                    $ X 1000

W.O. #                  Description                       Current Cost Estimate

145                     SVC Installation                           27,420*

146                     Microwave (Chester)                           151

138/149                 Power Line Carrier                             32

147                     T-Line Tap                                    674

153                     Aux. Pwr. Line                                 20


                                 S. Total Project                  28,297

                                 Contingency                        2,175

                                 Total Before Bonus                30,472

                                 Bonus Contingency                  3,250

                                 Total Before Interest             33,722**


     *    Excludes performance bonuses that may be earned after completion.

     **   Interest  accrues at FRB monthly  average one month  commercial  paper
          rate on all costs advanced by NE Hydro (support Agreement ss.7)


<PAGE>


                       EXHIBIT B TO PARTNERSHIP AGREEMENT

                    Unanimous Resolution of Owners' Committee

                             Chester SVC Partnership

Pursuant  to  Sections 8 and 9 of that  certain  Partnership  Agreement  between
NORVARCO and [BH Sub], dated as of July 1, 1990,  ("Partnership  Agreement") the
undersigned  duly  authorized  members of the Owners'  Committee  of Chester SVC
Partnership hereby adopt the following resolutions:

     RESOLVED:  Subject to the terms of the Partnership  Agreement and the terms
     of  the  Basic  Operating  Agreement,  NORVARCO  is  hereby  designated  to
     administer  the  day-to-day  business and  operations  of the  Partnership.
     Subject to the foregoing, NORVARCO shall:

     (1) Operate the business of the Partnership in the ordinary course,  in the
     best  interests of the Partners and in the exercise of reasonable  business
     judgment,  and in compliance with all applicable Federal,  state, local and
     foreign laws, regulations, ordinances, rules and orders;
     (2) Supervise the SVC Project;
     (3) Employ,  train  supervise  and,  when deemed  appropriate  by NORVARCO,
     discharge  any or  all  employees  of  the  Partnership  and  maintain  all
     personnel records relating thereto;
     (4) Execute any and all  documents,  agreements or  instruments of any kind
     which NORVARCO may deem  appropriate in conducting the day-to-day  business
     of the Partnership;
     (5) Prosecute,  defend,  settle and compromise in such a manner as NORVARCO
     may deem  expedient  any actions at law or in equity  brought by or against
     the Partnership  (other than any action or proceeding  brought by a Partner
     to enforce NORVARCO'S obligations);
     (6) Employ and pay for such  professional  or other  assistance as NORVARCO
     may deem desirable in the discharge of its duties;
     (7)  Prepare  and  file tax  returns  and deal  with  the  auditors  of the
     Partnership in all respects;
     (8) Establish  Partnership bank accounts and authorize  appropriate persons
     to draw thereon; and
     (9) Render  invoices  to New  England  Hydro-Transmission  Corporation  for
     payments due the  Partnership  and make  payments to Maine  Electric  Power
     Company, Inc. under the Basic Operating Agreement.

     Provided,  however,  that the  authority  of  NORVARCO  shall not extend to
     matters within the  responsibility  of Maine  Electric Power Company.  Inc.
     under  the  Basic  Operating  Agreement  dated as of July 1,  1990,  nor to
     matters reserved to the unanimous action of this Committee under Section 10
     of the Partnership Agreement; and further

     RESOLVED:  That this resolution shall remain in full force and effect for a
     period of five  years  from the date  hereof,  unless  earlier  revoked  or
     modified by a majority vote of this Committee.

This  resolution  shall be filed with the minutes of the meetings of the Owners'
Committee.

Date:  ______________, 19__             ________________________________________

                                        ________________________________________



<PAGE>


                       EXHIBIT C TO PARTNERSHIP AGREEMENT

                       Description of Off-Site Facilities

1.0       Certain microwave communication improvements located at the following:
          1. 1    Augusta
          1. 2    Bagley Mountain
          1. 3    Blackcap Mountain
          1. 4    Blinn Hill
          1. 5    Coggan's Hill
          1. 6    Mt. Agamenticus
          1. 7    Orrington
          1. 8    Park Street (Bangor)
          1. 9    Wytopitlock (Drew Plantation)
          1.10    Skiff Lake, New Brunswick, Canada

2.0       Certain  protective  relaying   improvements,   located  at  Orrington
          Substation, necessitated by the addition of the Chester SVC Facility.



<PAGE>


                       EXHIBIT D TO PARTNERSHIP AGREEMENT

        Costs of SVC Facility, Transmission Work and Off-Site Facilities

                             Cost of SVC Facility:*

                                          Amount Paid           Accruals
            Description                  as of 8/31/90        as of 8/31/90


ABB Construction Contract                  $25,187,544           $1,081,051**

Microwave Towers and Equip.                    204,891                2,810

12.5kv Aux. Power Line                          19,744

Organizational Costs                           178,897               13,508

Power Line Carrier                              77,341                4,895

Interest Accrued                                                  1,469,709

Interest Earned                               (106,363)


     Total                                 $25,562,054           $2,571,973
                                            ==========            =========

_________________________________

     * Chester assumes and agrees to pay the actual costs paid and accrued, plus
all pending invoices (i.e.,  work completed but not yet billed,  or work not yet
completed),  together  with  all  interest  thereon  at  the  average  rate  for
commercial paper as published each month in the Federal Reserve Bulletin,  as of
the  effective  date of the transfer of the assets from MEPCO to Chester.  These
amounts shall be  determined by and from the financial  records of MEPCO as soon
as reasonably possible after the close of the period ending October 31, 1990. In
addition,  Chester  assumes  and agrees to pay,  when and to the extent the same
become due and payable, any completion or performance bonuses provided under the
Construction Contract.

     ** This amount includes $750,000 of disputed noise compliance holdback.



<PAGE>



                           Cost of Transmission Work:*

                                          Amount Paid             Accruals
            Description                  as of 8/31/90          as of 8/31/90


345kv Transmission Line                       $767,251                    $57

Interest Accrued                                                       43,894

Interest Earned                                 (3,177)
                                           ------------           -----------

     Total                                    $764,074                $43,951
                                               =======                 ======


_________________________________

     * Chester assumes and agrees to pay the actual costs paid and accrued, plus
all pending invoices (i.e.,  work completed but not yet billed,  or work not yet
completed),  together  with  all  interest  thereon  at  the  average  rate  for
commercial paper as published each mouth in the Federal Reserve Bulletin,  as of
the  effective  date of the transfer of the assets from MEPCO to Chester.  These
amounts shall be  determined by and from the financial  records of MEPCO as soon
as reasonably possible after the close of the period ending October 31, 1990.



<PAGE>



                          Cost of Off-Site Facilities:*

                                          Amount Paid            Accruals
            Description                  as of 8/31/90          as of 8/31/90


Microwave Towers & Equip.                     $830,102                   $703

Microwave Buildings                            117,532

Relaying Equip. at Orrington                   170,686                  5,497

Interest Accrued                                                       65,699

Interest Earned                                 (4,755)
                                           ------------           -----------

     Total                                  $1,113,565                $71,899
                                             =========                 ======


_________________________________

     * Chester assumes and agrees to pay the actual costs paid and accrued, plus
all pending invoices (i.e.,  work completed but not yet billed,  or work not yet
completed),  together  with  all  interest  thereon  at  the  average  rate  for
commercial paper as published each month in the Federal Reserve Bulletin,  as of
the  effective  date of the transfer of the assets from MEPCO to Chester.  These
amounts shall be  determined by and from the financial  records of MEPCO as soon
as reasonably possible after the close of the period ending October 31, 1990.

     Chester also  assumes the  obligation  of MEPCO to  reimburse  NEH for cash
provided  by NEH to, and held,  as of the time of said  transfer  of assets,  by
MEPCO as an advance  against  expenses,  together with  interest  thereon at the
average rate for commercial paper as published each mouth in the Federal Reserve
Bulletin;  provided,  however,  that MEPCO shall retain,  and shall be liable to
NEH, pursuant to the Basic Operating Agreement, with respect to, so much of said
cash as MEPCO shall use to pay  expenses  associated  with the  construction  of
certain  Off-Site  facilities  located at Skiff Lake.  The balance of such cash,
together with all interest  income from the  investment  of said amount,  as the
same shall be determined  by and from the financial  records of MEPCO as soon as
reasonably possible after the close of the period ending October 31, 1990, shall
be  transferred  to Chester by MEPCO as soon as reasonably  possible  after said
amount is so determined.


</TEXT>
</DOCUMENT>
