EASTERN ENTERPRISES
                 1994 DEFERRED COMPENSATION PLAN

                              Amendment
                              ---------
  This amendment of the Eastern Enterprises 1994 Deferred Compensation Plan (the
"Plan") shall take effect as of the date set forth below, being the date the
amendment was adopted by the Board of Trustees of Eastern Enterprises (the 
"Company").

  WHEREAS The Company established the Plan in 1994 to provide an incentive fo
selected management or highly compensated employees through voluntary unfunded
deferrals and related credits; and

  WHEREAS the Plan is administered by the Compensation Committee of the Board
of Trustees of Eastern (the "Administrator"); and

  WHEREAS the Company has determined that efficient administration of the Plan
would be enhanced by encouraging uniformity in the payout periods elected by a
participant under the Plan; and

  WHEREAS Eastern is mindful of 4 U.S.C. (section symbol) 114 ("H.R. 394"), 
enacted since the date of adoption of the Plan, and the benefits associated 
with compliance with the provisions of H.R. 394;

  NOW, THEREFORE, the Company amends the Plan pursuant to Article X thereof by
(i) amending paragraph (d) of Article VIII by deleting everything after the 
second sentence thereof; (ii) by redesignating paragraph (e) of Article VIII
of the Plan as paragraph (h), and (iii) by adding new paragraphs (e), (f) and
(g) to Article VIII to read in their entirety as follows:

     "(e) Nothwithstanding (a), (b) and (d) above, a Participant may at any time
elect to change the period of years over which distributions had been elected to
be paid under (d), or may elect annual cash installments as described in (d)
rather than a lump sum payment under paragraph (a), with respect to amounts
already deferred under Article III; provided, that any such later election or
change of election (a "later election") shall be effective only as to Accounts
paid or commencing to be paid after the second anniversary of the date such
later election is received by the Administrator care of the Company at the
Company's principal place of business in Weston, Massachusetts (the "later
election effective date"). A later election under this paragraph (e) shall be in
writing on a form approved or prescribed by the Administrator. If any Account as
to which a later election under this paragraph (e) has been made would (but for
such later election) have become payable in full or would have commenced to be
paid prior to the later election effective date, it shall be paid in accordance
with (a) or (d) above, whichever is applicable, as though such later election
had never been made.

     (f) In addition to and not in lieu of the provisions of (e) above, each
Participant who is an active employee with outstanding Accounts as of August 1,
1996 and who anticipates retirement on or after January 1, 1997 but on or prior
to December 31, 1998 may request the Administrator on or prior to October 31,
1996 to change the distribution period for any such Account (and for any
remaining deferrals during 1996) to an installment period of ten years or more.
The Administrator shall determine in its sole discretion, on or prior to
December 31, 1996, whether to grant such requests or any of them.

     (g) The Administrator may specify the number or maximum number of years
over which installments will be paid. The amount of each installment shall be
determined by dividing that portion of the Participant's Accounts payable in
such installments by the number of remaining installments. Where an Account is
payable in installments, notional earnings shall continue to be credited to the
balance of the Account until the Account is distributed in full. If a
Participant who has elected installment distributions dies prior to the
commencement or completion of the distributions, remaining payments shall be 
made to the Participant's beneficiary or beneficiaries (or to the Participant's
estate) as provided under (b) above in accordance with the schedule of
installment distributions elected by the Participant, except that the
Administrator at any time following the Participant's death may commute the
remaining installment distributions to a single cash lump sum payment."

  IN WITNESS WHEREOF, Eastern Enterprises has caused this instrument of
amendment to be executed by its duly authorized officer this 25th day of
July, 1996.

                                          EASTERN ENTERPRISES

                                          By /s/L. William Law, Jr.
                                             ---------------------------------
                                             Senior Vice President, General
                                               Counsel and Secretary
 

As approved by the Board of Trustees
on July 25, 1996