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                                  EXHIBIT 10.13
                FIRST AMENDMENT TO THE CONNECTICUT WATER COMPANY
                EMPLOYEES' RETIREMENT PLAN, ADOPTED MARCH 2, 1998

                         Effective as of January 1, 1998

         Article VIII of the Connecticut Water Company Employees' Retirement
Plan (the "Plan") is hereby amended to read in its entirety as follows:

                                  "ARTICLE VIII
                                   DISABILITY

8.1      Eligibility and Disability Determination. If a medical examiner
         selected by the Employer certifies that an Employee who has completed 5
         years of Credited Service is mentally or physically disabled for
         further performance of duty and that such disability is likely to be
         permanent, such that the Employee is considered eligible for full
         disability benefits under the provisions of the Social Security Act,
         this Employee shall be eligible for the monthly benefit described
         below.

8.2      Disability Benefit. The monthly income of an Employee who becomes
         eligible for a monthly benefit in accordance with Section 8.1 shall
         equal the Basic Retirement Income as determined in Section 4.2 based on
         his Average Earnings and his Credited Service as 


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         of his Termination Date reduced by the Early Retirement Percentage
         Factor from Subsection 5.2(b) applicable to the number of complete
         years by which the commencement of payment of his Retirement Income
         precedes his attainment of age 65, with a Percentage Factor of .72 if
         the commencement of payment of his Retirement Income precedes his
         attainment of age 65 by more than 9 complete years. Notwithstanding the
         foregoing to the contrary, effective January 1, 1998, the monthly
         income of an Employee who becomes eligible for a monthly benefit in
         accordance with Section 8.1, and with respect to whom the sum of his
         age and Credited Service as of his Termination Date is equal to or
         greater than 80, shall equal his Basic Retirement Income as determined
         in Section 4.2 based on his Average Earnings and his Credited Service
         as of his Termination Date unreduced for commencement prior to his
         attainment of age 65.

8.3      Form and Commencement of Payments. An Employee who becomes eligible for
         a monthly benefit in accordance with Section 8.1 may elect to receive
         such benefit commencing on the first day of any month following his
         Termination Date; provided, however, that no payments shall be made
         under this Article VIII while the Employee is receiving disability
         benefits from the Employer's long-term disability plan. Such benefit
         shall be paid in the form provided in Section 4.3.

8.4      Reemployment. If a former Employee is reemployed by the Employer after
         commencing to receive benefits under this Article VIII, payment of the
         Employee's benefits will be
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         suspended and benefits will continue to accrue under this Plan as
         described in Article IV when all of the following have occurred:


         (a)      The Employee has been rehired by the Employer;

         (b)      The Employee is credited with 40 or more Hours of Service in a
                  month; and

         (c)      The Employee has elected to resume participation in the Plan.

Benefit payments suspended as provided above will recommence as of the
Employee's subsequent retirement and will be determined as provided in Article
IV. The Employee's accrued benefit, however, will be offset by the Actuarial
Equivalent of any amount of the Employee's prior accrued benefit previously
distributed to him. An Employee whose benefits are suspended as provided above
shall receive the notification required by applicable law and regulations on the
suspension of benefits.