**Exhibit      4.12**

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**United      Utilities PLC**

  

**Service      Contract**

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**Part      one - General information**

| **1**  | **The            contract**                                                                                                                                                                                                                                                                         |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                |
|   | This        contract sets out the terms of your employment with us. By signing this        contract you agree to keep to these terms. The contract will be interpreted        and governed by English law.                                                                                          |
|   |                                                                                                                                                                                                                                                                                                |
| **2**  | **Job          description**                                                                                                                                                                                                                                                                        |
|   |                                                                                                                                                                                                                                                                                                |
| a      | We are        a member of the United Utilities group of companies. In this contract        and schedule, group means United Utilities PLC and any company of which        United Utilities PLC holds more than 20% of the share capital as defined        by Section 744 of the Companies Act 1985. |
|   |                                                                                                                                                                                                                                                                                                |
| b      | You are        employed to do the job described in the job title above. However we may        ask you to do other work or carry out work for another company within        the group                                                                                                                |

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|   | either        on a temporary or a permanent basis***.***                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| c      | The name        or office of the person you report to each day when you start work under        this contract is shown in the schedule. Our reporting structures may        change but you will be responsible to our board of directors (**the        board**).                                                                                                                                                                                                                                                                                |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| d      | You must        keep to all rules, procedures, practices and guidelines we approve.                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| **3**  | **Start          date of your contract**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|   | The start        date of this contract and the date your continuous employment starts        with us are shown in the schedule.                                                                                                                                                                                                                                                                                                                                                                                                                 |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| **4**  | **Place          of work**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| a      | Your        main place of work is shown in the schedule. You must live within reasonable        daily travelling distance and time from your main place of work.                                                                                                                                                                                                                                                                                                                                                                                |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| b      | We may        ask you to work outside the United Kingdom on a temporary basis for periods        of up to 12 months. If we send you overseas we will continue to pay you        in pounds sterling and we will give you any allowances we think are necessary.                                                                                                                                                                                                                                                                                  |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| c      | You must        agree to travel to allow you to do your work. We will pay any reasonable        expenses involved.                                                                                                                                                                                                                                                                                                                                                                                                                              |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| d      | We may        ask you to work anywhere in the United Kingdom. If your place of work        is permanently changed to a place which is too far to travel to, we may        agree to pay reasonable expenses to move you. These expenses may include        removal expenses, legal expenses, estate agent's fees, a disturbance        allowance of up to £5,000, the reasonable cost of temporary accommodation        or interest charges on a bridging loan. If we ask you to move we will        try to take your wishes into account. |

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| **5**  | **Hours**                                                                                                                                                                                                                                                                                                                       |
|-------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|        |                                                                                                                                                                                                                                                                                                                            |
|        | We cannot        give you fixed hours of work due to your responsibilities and duties.        You must work any hours we feel are necessary to allow you to fulfil        your duties under this contract. You are exempt from the Working Time        Regulations 1998 provisions relating to the maximum weekly working time. |

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**Part        2 - Benefits**

| **6**  | **Pay**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| a      | We        will pay you the salary shown in the schedule. We will pay your salary        directly into your bank account on or about the 15th day of each month.        This amount will cover part of the month just passed and part of the        month to come.                                                                                                                                                                                                                                                                                         |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| b      | You        will not be entitled to extra pay for any overtime.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| c      | We        will review your salary and benefits each year on 1 September***.***Each        review will take account of changes in the cost of living, how we are        doing and your contribution to that performance. We may increase your        salary following a review but we do not have to.                                                                                                                                                                                                                                                      |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| d      | The        pay package shown in the schedule will add up from day to day and will        include any fees which you may be entitled to as a director of the company        or any other company in the group.                                                                                                                                                                                                                                                                                                                                             |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| **7**  | **Incentive          arrangements**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|   | Each        year, at our discretion, we may invite you to take part in our incentive        arrangements. Participation in any incentive plan and the terms of your        participation are not part of your employment contract. If we invite        you to participate in any one year, it does not mean you are entitled        to participate in future years. We may amend, replace or withdraw incentive        arrangements at any time but we will tell you if we do so. Details of        the awards you may receive are shown in the schedule. |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| **8**  | **Car          allowance/Company car**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|   | We        will pay you an allowance instead of providing you with a company car.        The amount is shown in the schedule. We do not count this allowance when        we calculate your pension. We may choose to provide you with a car. If        we do, we will send you a list of the type of car you can have. You may        use the car for private journeys.                                                                                                                                                                                    |

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| **9**  | **Expenses**                                                                                                                                                                                                                                                                                                               |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                       |
|   | We        will pay you any travelling, hotel, entertainment and out-of-pocket expenses        you have had to pay to carry out your duties, provided we think they        are reasonable. You must provide, where available, receipts or other        evidence we ask for.                                                 |
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| **10** | **Holidays          and holiday pay**                                                                                                                                                                                                                                                                                      |
|   |                                                                                                                                                                                                                                                                                                                       |
| a      | Unless        we say otherwise in the schedule:                                                                                                                                                                                                                                                                            |
|   |                                                                                                                                                                                                                                                                                                                       |
|   | •                                                                                                                                                                                                                                                                                                                    | your        yearly entitlement is 26 days |
|   |                                                                                                                                                                                                                                                                                                                       |   |
|   | •                                                                                                                                                                                                                                                                                                                    | at        the start of each holiday year, your entitlement will increase by one        day for each completed holiday year you have worked for us until, after        4 completed holiday years, you have a yearly entitlement of 30 days. |
|   |                                                                                                                                                                                                                                                                                                                       |   |
|   | •                                                                                                                                                                                                                                                                                                                    | the        holiday year runs from 1 April to the following 31 March. |
|   |                                                                                                                                                                                                                                                                                                                       |   |
| b      | Your        entitlement to holidays adds up at the beginning of each holiday year        except in the holiday year in which your employment with us begins or        ends. In this case, your entitlement to holidays adds up at 1/12 of your        yearly entitlement for each complete month of service you carry out. |
|   |                                                                                                                                                                                                                                                                                                                       |
| c      | In        each holiday year you will be entitled to all statutory or public holidays        with pay. If we ask you to work on statutory or public holidays we will        give you other days off instead.                                                                                                                |
|   |                                                                                                                                                                                                                                                                                                                       |
| d      | You        can carry forward up to five days holiday from one year as long as you        take these within 2 months of the end of the previous holiday year. You        must take all other holidays during the holiday year and may not carry        them forward to the following holiday year.                          |
|   |                                                                                                                                                                                                                                                                                                                       |
| e      | We        must approve all holidays. If we give you extra holidays in any one holiday        year, it does not mean you are entitled to them in future years.                                                                                                                                                              |

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| f      | If        we end your employment for any reason part way through a holiday year        you will receive payment for days of holiday due to you but which you        have not taken yet. If you have taken holidays before you are actually        entitled to them you must repay us the cost of those days. We may take        this amount from any amounts we owe you. |
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| **11** | **Sickness,          injury and medical examinations**                                                                                                                                                                                                                                                                                                                   |
|   |                                                                                                                                                                                                                                                                                                                                                                     |
| a      | If        you cannot carry out your duties under this contract because you are        ill or injured, you will be eligible to receive sick pay from us. Your        eligibility is related to your period of continuous service. In any 12-month        period you will receive up to the following payments: -                                                          |
|   |                                                                                                                                                                                                                                                                                                                                                                     |

|   | If        you have received any sick pay in the 12 months immediately before a        period you are off through illness, we will reduce your eligibility for        further sick pay by the amount of sick pay you will already have received        in the last 12 months. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                         |
| b      | When        you have used up all of your eligibility, we will not pay any further        sick pay (other than any entitlement you may still have to statutory        sick pay) until you return to work.                                                                     |
|   |                                                                                                                                                                                                                                                                         |
| c      | We        will take the amount of statutory benefits which you are entitled to        under the statutory sick pay scheme from any sick pay we pay you.                                                                                                                      |
|   |                                                                                                                                                                                                                                                                         |
| d      | We        use the five qualifying days of Monday to Friday when we work out payments                                                                                                                                                                                         |

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|   | under          the statutory sick pay scheme.                                                                                                                                                                                                                                                                                                                                 |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                          |
| e      | We        may ask you to have a medical examination at any time. We will pay the        cost of the examination and will choose the doctor concerned who will        send a written report to our occupational health adviser. If we ask you        and you refuse to have a medical examination when we are paying you sick        pay, we may not pay any further sick pay. |
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| **12** | **Health          screening**                                                                                                                                                                                                                                                                                                                                                 |
|   |                                                                                                                                                                                                                                                                                                                                                                          |
|   | We        will give you the opportunity to have regular medical screening (usually        every two years) at our expense. You will receive a report from the doctor.                                                                                                                                                                                                         |
|   |                                                                                                                                                                                                                                                                                                                                                                          |
| **13** | **Private          health cover**                                                                                                                                                                                                                                                                                                                                             |
|   |                                                                                                                                                                                                                                                                                                                                                                          |
| a      | We        will include you, free of charge, in our private health scheme unless        you tell us within one month of receiving this contract that you do not        want to be included The scheme is a taxable benefit under Inland Revenue        regulations.                                                                                                            |
|   |                                                                                                                                                                                                                                                                                                                                                                          |
| b      | If        you wish, you can apply to include your spouse and children. You will        have to pay the cost.                                                                                                                                                                                                                                                                  |
|   |                                                                                                                                                                                                                                                                                                                                                                          |
| **14** | **Retirement          age and pension**                                                                                                                                                                                                                                                                                                                                       |
|   |                                                                                                                                                                                                                                                                                                                                                                          |
|   | Details        of your retirement age and our pension scheme are given in the schedule.                                                                                                                                                                                                                                                                                       |
|   |                                                                                                                                                                                                                                                                                                                                                                          |
| **15** | **Cover          against risk of death or injury**                                                                                                                                                                                                                                                                                                                            |
|   |                                                                                                                                                                                                                                                                                                                                                                          |
|   | You        are covered, free of charge, by our personal accident insurance scheme.        The benefits include a payment of up to five times your salary if you        die or become seriously disabled. This will depend on the terms and conditions        of the scheme, which may change, and is on top of any benefit provided        under your pension arrangements.   |

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**Part      three - your obligations as an employee**

| **19** | **Competition          and shareholdings**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| a      | You        must spend all of your time and attention during working hours on our        business. You must not be involved in any way with any other person firm        or company whatever its trade or business unless you get our written        permission. This means that you must not own shares or make investments        in companies or partnerships or work for or offer advice or help to another        business. However you may hold investment-only shares, debentures or        other securities in a company whose capital is traded on a recognised        stock exchange. You can only do this if your interest, together with        that of your spouse and your children is not more than 5% of the issued        value of the class of shares and so on in question. |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| b      | You        may receive or have unpublished price-sensitive information about us        or the group. Under Part V of the Criminal Justice Act 1993 it is a crime        to deal in securities while you have price-sensitive information. To        protect you and us the group has adopted the London Stock Exchange Model        Code for directors' dealings and you must keep to the terms of the code        whether or not you are a director of the company. You may get a copy        of the code from the Company Secretary's office.                                                                                                                                                                                                                                               |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| c      | You        are required to build up a shareholding in United Utilities. Details        of your shareholding target are set out in the schedule.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| **20** | **Confidentiality**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| a      | You        must not give anyone or use at any time any trade secret or confidential        information, unless you have to do this as part of your job. We have        defined confidential information in para 20c below. This applies during        your employment and after the end of your employment with us.                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| b      | You        must not make any comment about the group or about your job to any reporter        or other representative of any radio or television station or any newspaper,        unless you have to do this when carrying out your duties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

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| c      | Confidential        information is information which you learn during your employment about        the activities of the group anywhere in the world, which you could not        have got elsewhere and which the group has not published.                                                                                                                                                                                                                                      |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| d      | All        records (including records stored in any electronically-readable form),        drawings and documents and copies of records, drawings and documents        relating to our activities or the activities of the group are the property        of the group. You must keep them safe and must give them to us immediately        if we ask. You must return all the records, drawings and documents and        all the copies you have to us if you leave the Company. |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| **21** | **Intellectual          property**                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| a      | In        this clause the following terms will have the following meaning:                                                                                                                                                                                                                                                                                                                                                                                                      |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|   | •                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Intellectual        property means patents, trade marks, service marks, rights (whether registered        or unregistered) in any designs, trade or business names, copyright work        and designs and know how and any other rights of a similar nature together        with applications for and the right to apply for any of these. |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |
|   | •                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Invention        means any improvement, invention or discovery. |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |
|   | •                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Company        invention means any invention made by you which is our property. |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |
| b      | You        must protect and promote our interests relating to intellectual property        taking account of particular policy statements the group issues.                                                                                                                                                                                                                                                                                                                     |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| c      | If        at any time while you are employed under this contract you make or discover        or take part in making or discovering any invention relating to our business        you must immediately give us full details so we can decide whether or        not it is a company invention. We call details that you must tell us        about “development information”.                                                                                            |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| d      | If        the invention is a company invention:                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|   | •                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | It        will be our property and we may deal with it and the development information        in any way we choose; and |

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|   | •                                                                                                                                                                                                                                                                                                                                                                                 | We can        ask you to give us any information, data, drawings and help we need to        use the invention to the best advantage.                                                                                                                                                                                                                  |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                  |
| e      | If        you make or discover or take part in making or discovering any invention        while you are employed under this contract and this is not a company        invention we will have the right to receive your rights in the invention        within three months after you have told us about it. Fair and reasonable        terms will be agreed or settled by an arbitrator. |
|   |                                                                                                                                                                                                                                                                                                                                                                                    |
| f      | You        must agree to the following:                                                                                                                                                                                                                                                                                                                                                 |
|   |                                                                                                                                                                                                                                                                                                                                                                                    |
|   | •                                                                                                                                                                                                                                                                                                                                                                                 | You        must promptly give us all work and designs you or others think of, develop        or make. You must hold them in trust for us until we have all rights        to them. This does not apply to any work or designs you think of, develop        or make outside your normal working hours.                                                  |
|   |                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                  |
|   | •                                                                                                                                                                                                                                                                                                                                                                                 | You        must transfer to us all copyright, design right and other rights (if        any) for all work and designs you think of, develop or make while you        are employed by us. This does not apply to work or designs you think        of, develop or make outside your normal working hours if they are not        connected with your job. |
|   |                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                  |
|   | The        conditions of the Patents Act 1977 also apply to inventions and our rights        under the Copyright Designs and Patents Act 1988.                                                                                                                                                                                                                                          |
|   |                                                                                                                                                                                                                                                                                                                                                                                    |
| g      | You        must also do everything possible to:                                                                                                                                                                                                                                                                                                                                         |
|   |                                                                                                                                                                                                                                                                                                                                                                                    |
|   | •                                                                                                                                                                                                                                                                                                                                                                                 | Give        us all the rights to all intellectual property in any company invention,        the development information and any work;                                                                                                                                                                                                                 |
|   |                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                  |
|   | •                                                                                                                                                                                                                                                                                                                                                                                 | Apply        for, get and maintain all patents, copyright, design rights, registered        designs, trade marks or other protection for any company invention and        the work in parts of the world we specify;                                                                                                                                  |
|   |                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                  |
|   | •                                                                                                                                                                                                                                                                                                                                                                                 | Resist        any objection or opposition to getting any petitions or applications        for revocation of any such rights and protection referred to in this        clause; and                                                                                                                                                                     |

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|   | •                                                                                                                                                                                                                                                                                                                           | Bring        any legal action affecting the rights and protection referred to in this        clause. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                              |
| h      | You        will not use your rights to any work or company invention against us.                                                                                                                                                                                                                                                  |
|   |                                                                                                                                                                                                                                                                                                                              |
| i      | You        must appoint us as your attorney to do anything and generally to use        your name for the purpose of giving us the full benefit of the conditions        of this paragraph 21. A written certificate signed by any director or        the secretary of the company will be proof that we may act as your attorney. |
|   |                                                                                                                                                                                                                                                                                                                              |
| j      | Rights        and obligations relating to inventions under this paragraph will continue        after your employment ends.                                                                                                                                                                                                        |
|   |                                                                                                                                                                                                                                                                                                                              |
| k      | Nothing        in this clause will affect our or your rights under Sections 39 to 43        of the Patents Act 1977.                                                                                                                                                                                                              |

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**Part four – Ending your contract**

| **22** | **Ending          your employment**                                                                                                                      |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                     |
| a      | Either        you or we may end your employment by giving the period of notice in writing        set out in the schedule.                                |
|   |                                                                                                                                                     |
| b      | We        can dismiss you without notice if you seriously break your obligations        to us. The following list gives some examples of serious breaks: |
|   |                                                                                                                                                     |
|   | •                                                                                                                                                  | Dishonesty. |
|   |                                                                                                                                                     |   |
|   | •                                                                                                                                                  | Corruptly        giving or accepting or agreeing to give or accept a gift or payment as        a reward for doing or not doing any act to do with the business. |
|   |                                                                                                                                                     |   |
|   | •                                                                                                                                                  | If you        neglect your duties under this contract. |
|   |                                                                                                                                                     |   |
| c      | We        may also dismiss you immediately by notice in writing if:                                                                                      |
|   |                                                                                                                                                     |
|   | •                                                                                                                                                  | in our        reasonable opinion, you do not do your work competently; or |
|   |                                                                                                                                                     |   |
|   | •                                                                                                                                                  | you are        away from work because of illness or injury for 260 working days or more        in any eighteen-month period; or |
|   |                                                                                                                                                     |   |
|   | •                                                                                                                                                  | you are        prevented by law from being a Director; or |
|   |                                                                                                                                                     |   |
|   | •                                                                                                                                                  | you cannot        work because of a mental disorder; or |
|   |                                                                                                                                                     |   |
|   | •                                                                                                                                                  | you become        bankrupt or make any arrangement with people you owe money to. |
|   |                                                                                                                                                     |   |
| **23** | **Garden          Leave**                                                                                                                                |
|   |                                                                                                                                                     |
|   | During        any period of notice given by us to you or by you to us, we may:                                                                           |

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|   | •                                                                                                                                                                                       | require        you not to do work for us                                                       |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                          |                                                                                           |
|   | •                                                                                                                                                                                       | require        you not to attend our offices; and                                              |
|   |                                                                                                                                                                                          |                                                                                           |
|   | •                                                                                                                                                                                       | suspend        your authority to act on behalf of us                                           |
|   |                                                                                                                                                                                          |                                                                                           |
|   | without        otherwise affecting your duties to us under this contract and without        affecting your entitlement to receive the pay and benefits due to you        under this contract. |
|   |                                                                                                                                                                                          |
| **24** | **Suspension**                                                                                                                                                                                |
|   |                                                                                                                                                                                          |
|   | We        may suspend you while we investigate a disciplinary matter. You must        co-operate in any investigation and give us any help we ask for.                                        |
|   |                                                                                                                                                                                          |
| **25** | **Resigning          as a director**                                                                                                                                                          |
|   |                                                                                                                                                                                          |
|   | You        must agree that you will resign as a director:                                                                                                                                     |
|   |                                                                                                                                                                                          |
|   | •                                                                                                                                                                                       | Within        seven days from the end of your employment with us for whatever reason        or |
|   |                                                                                                                                                                                          |                                                                                           |
|   | •                                                                                                                                                                                       | If        we ask at any time during any period of notice.                                      |
|   |                                                                                                                                                                                          |                                                                                           |
|   | If        you do not do this, the Company Secretary will give your resignation        on your behalf.                                                                                         |
|   |                                                                                                                                                                                          |
| **26** | **Returning          your company car**                                                                                                                                                       |
|   |                                                                                                                                                                                          |
|   | If        you have a company car when your employment ends you must deliver it        back to us.                                                                                             |
|   |                                                                                                                                                                                          |
| **27** | **Paying          your final salary**                                                                                                                                                         |
|   |                                                                                                                                                                                          |
| a      | We        will pay you any amounts we owe when we receive the items listed below        if we end your employment:                                                                            |

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|   | •                                                                                                                   | A company        vehicle;                                                                                                                    |
|--------|---------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                      |                                                                                                                                         |
|   | •                                                                                                                   | Any of        the records referred to in paragraph 20d above; or                                                                             |
|   |                                                                                                                      |                                                                                                                                         |
|   | •                                                                                                                   | Any of        our other property such as a mobile telephone and company computer                                                             |
|   |                                                                                                                      |                                                                                                                                         |
|   | You        must return all these items in a satisfactory condition.                                                       |
|   |                                                                                                                      |
| b      | We        can take any amounts you owe us for the following from any amounts we        owe you if we end your employment: |
|   |                                                                                                                      |
|   | •                                                                                                                   | Any amount        we give you in advance or overpayment of salary, commission or expenses        or for any loan of any kind we make to you. |
|   |                                                                                                                      |                                                                                                                                         |
|   | •                                                                                                                   | Any amount        you owe us for a company car upgrade or accessories.                                                                       |
|   |                                                                                                                      |                                                                                                                                         |
|   | •                                                                                                                   | Any loss        we have suffered due to fraud, other dishonesty or your neglect.                                                             |

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**Part five - Restrictions**

| **28** |  **Restrictions**                                                                                                                                                                                                                                                 |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                   |
| a      | Unless        you have our written permission, you must not do the following for a        period of 12 months after the end of your employment or for a period        in respect of which we have compensated you for loss of office, whichever        is the shorter, |
|   |                                                                                                                                                                                                                                                                   |
|   | •                                                                                                                                                                                                                                                                | You cannot        be employed, involved or interested in any business in competition with        the group in an area for which you had direct management responsibilities        or had direct dealings in the course of your employment during the 12        months immediately before the end of your employment. |
|   |                                                                                                                                                                                                                                                                   |   |
|   | •                                                                                                                                                                                                                                                                | You cannot        try to get business from or deal with any firm, person or company in        competition with the group who during the 12 months immediately before        your employment ended was a customer or supplier of the group you had        contact with. |
|   |                                                                                                                                                                                                                                                                   |   |
|   | •                                                                                                                                                                                                                                                                | You must        not try to encourage away from the group any person who works for the        group who has confidential or sensitive information about our business. |
|   |                                                                                                                                                                                                                                                                   |   |
| b      | If        any of the obligations under this clause cannot be enforced it will not        affect any of the other clauses in this agreement.                                                                                                                            |
|   |                                                                                                                                                                                                                                                                   |
| c      | The        obligations of clause 28a apply equally during your employment.                                                                                                                                                                                             |

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| d      | You        must agree that you will not at any time:                                                         |
|--------|--------------------------------------------------------------------------------------------------------------|
|   |                                                                                                         |
|   | •                                                                                                      | Carry        out any trade or business or be associated with any company engaged in        any trade or business using any brand names as long as those names are        connected with us; or |
|   |                                                                                                         |   |
|   | •                                                                                                      | After          your employment ends, represent or claim you are associated with any          company or division within the group. |
|   |                                                                                                         |   |
| e      | If        these clauses are judged to be unreasonable we may amend them and they        will still be valid. |

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**Part six - Procedures and policies**

| **29** | **Grievance          procedure**                                                                                                            |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                        |
|   | If you        have a grievance relating to your employment you should refer it to the        Chief Executive, whose decision will be final. |
|   |                                                                                                                                        |
| **30** | **No          smoking policy**                                                                                                              |
|   |                                                                                                                                        |
|   | We aim        to provide a smoke-free environment for all our employees. You must not        smoke at any time while on our premises.       |

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|-----------------------------------------------------------|----------------------|--------|
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| This        agreement has been signed on                                 |   |                                                                               |
|--------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------|
| ........................................................................ |   |                                                                               |
|                                                                     |   |                                                                               |
|                                                                     |   |                                                                               |
| **Signed          as a deed**                                            | **)**  |                                                                               |
|                                                                     |   |                                                                               |
| by the        company                                                    | )      |                                                                               |
|                                                                     |   |                                                                               |
|                                                                     |   |                                                                               |
|                                                                     |   | .....................................................................              |
|                                                                     |   | **        Director**                       |
|                                                                     |   |                                                                               |
|                                                                     |   |                                                                               |
|                                                                     |   | .....................................................................              |
|                                                                     |   | **        Director          or Secretary** |
|                                                                     |   |                                                                               |
|                                                                     |   |                                                                               |
| **Signed          as a deed**                                            | )      |                                                                               |
|                                                                     |   |                                                                               |
| by                                                                       | )      | .....................................................................              |

|                                      |                                                                                                                                                                     |
|-------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                      | Name ................................................................................................................................................................... |
|                                      |                                                                                                                                                                     |
|                                      |                                                                                                                                                                     |
| in        the presence of the following   |
|                                      |                                                                                                                                                                     |
|                                      | Witness’s        signature......................................................................................................................................... |
|                                      |                                                                                                                                                                     |
|                                      | Name..................................................................................................................................................................   |
|                                      |                                                                                                                                                                     |
|                                      | Address.............................................................................................................................................................     |
|                                      |                                                                                                                                                                     |
|                                      | .................................................................................................................................                                        |
|                                      |                                                                                                                                                                     |
|                                      | .................................................................................................................................                                        |
|                                      |                                                                                                                                                                     |
|                                      | .................................................................................................................................                                        |
|                                      |                                                                                                                                                                     |
| 1Management        and Professional group |

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**Schedule to service contract – T W DRURY**

**Start date**

 This contract    begins on 9 May 2005. 

 The start    date for calculating your continuous employment is 1 January 1991. 

 2Place of    work 

 Your main    place of work will be Vertex House. 

 3Who you    will report to 

 You will    report to the Chief Executive. 

**Basic      salary**

 Your current    salary of £285,000 is being reviewed. 

**Incentive      arrangements**

**(i)   Annual      bonus plan**

 Each year    we may include you in the annual bonus plan but we do not have to. If we    do, we may pay you up to 60% of your basic salary. The level of payment may    be based on achieving performance targets and personal objectives. We may    pay you a bonus if you work for less than one year but for at least three    months. If we do it will be based on the period you worked. 

 Your first    bonus payment relating to this contract will be for 2005/06 and will be made    in June 2006, if we achieve the targets. 

 We may change    how the bonus scheme works. If we do we will tell you. 

 We do not    count the value of awards made under this plan when we calculate your pension. 

**(ii)   Performance      share plan**

 Each year,    at our discretion, we may also invite you to participate in the Group’s    performance share plan. This provides for an award each year which currently    is in the form of an option over a number of shares to the value of up to    80% of your salary, based on the market value of a share on the date of the    award. The actual number of shares over which an option may be exercised    is determined by United Utilities’ performance, 

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 measured    over a three year period beginning at the start of the financial year in    which the award of options was made. Options may be exercised after the end    of the performance period once the financial performance is known. You will    not have to pay anything to exercise your option. 

 Your first    award under this contract will be for the 2005/06 financial year. The extent    to which the award vests will depend upon the Group’s performance over    the three financial years ending 31 March 2008. We may change how the scheme    works. If we do, we will tell you. 

 We do not    count the value of awards made under this plan when we calculate your pensionable    pay. 

**Retirement      age**

 You will    retire when you are 60 years of age unless we agree that you may continue    to work after your 60th birthday. 

 4Pension    Scheme 

 Your pension arrangements    will be unchanged by this appointment. A contracting-out certificate has    been issued in relation to the scheme. 

 (a)Company car    allowance 

 We will pay    you a cash allowance of £14,000 per year. We will pay you one twelfth    of the yearly amount each month. The payment is taxable. We do not count    it when working out your pensionable pay. 

 We will provide    fuel for business and private mileage. The fuel you use for private mileage    is a taxable benefit. As we are not providing you with a company car, the    Inland Revenue’s car fuel benefit charge, based on carbon dioxide emissions,    does not apply. The tax payable for your private fuel will be assessed on    the actual value of the fuel used for private journeys. 

 5Telephone    charges 

 We will provide    and pay the costs associated with a business telephone and fax line and modem    equipment installed in your home. 

 We will provide    a mobile telephone for your business use. 

 5.1  **Notice**

 The period    of notice we will give you to end this contract is 12 months. 

 The period    of notice you must give us to end this contract is 12 months. 

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