Document:

2004 Thames Water/RWE Long -Term Incentive Plan, dated as of January 1, 2004

 Exhibit 10.13 
 2004 THAMES WATER / RWE LONG TERM INCENTIVE PLAN 
 SECTION 1  
 PURPOSE 
 1. The purpose of the 2004 Thames
Water / RWE Long Term Incentive Plan (the “Plan”) is to reward certain selected employees for their strong leadership and commitment to the financial interests and growth of American Water and Participating Companies by providing an
opportunity to receive a one time additional cash payment based on the contribution of the financial results of American Water and Participating Companies to the overall value of RWE stock. 
 SECTION 2 
 DEFINITIONS 
 2. Terms used in this Plan will have the following meanings: 
  

	 	2.1.	“American Water” means American Water Works Company, Inc., a Delaware corporation, and any successor thereto. 

  

	 	2.2.	“Award” means a Participant’s benefit under the Plan as described in Section 4. 

  

	 	2.3.	“Board” means the Board of Directors of American Water or its designee, including, without limitation, the Committee, as defined in Section 2.8 or any other
individual, committee, group or entity designated by the Board to administer and interpret this Plan. 

  

	 	2.4.	“Cause” shall mean unreasonable or willful neglect of duty, material performance issues, disloyalty, or business or personal conduct which is inconsistent with the
standards of reasonable employee conduct, in each case as determined in good faith by the Committee. 

  

	 	2.5.	“Committee” means the Board or any special committee appointed by the Board to administer the Plan. 

  

	 	2.6.	“Disability” means a disability as determined under the applicable long-term disability plan maintained by the Participating Company that employs such Participant.

  

	 	2.7.	“Participant” means a person designated by the Board pursuant to Section 3. 

  

	 	2.8.	“Participating Company” or “Participating Companies” means an entity or entities, a majority of whose shares or other ownership interests are held
directly or indirectly by American Water, that has an employee or employees participating in the Plan. 

  

	 	2.9.	“Plan Period” means the period beginning January 1, 2004 through July 24, 2007. 

	 	2.10.	“Retirement” means retirement as determined under the retirement benefit plan maintained by the Participating Company that employs such Participant. If that
Participating Company maintains or participates in a defined benefit plan retirement shall mean a termination of employment under circumstances that entitle the Participant to an immediately payable benefit under that plan. 

 

	 	2.11.	“RWE” means RWE Aktiengesellschaft, a publicly traded German company and ultimate parent of the Thames Water Group. 

  

	 	2.12.	“RWE Share Unit” means a unit representation of the value of a share of RWE publicly traded stock. 

  

	 	2.13.	“RWE Group” means Thames Water, American Water, their subsidiaries and any other RWE owned entities engaged in the water business in the United States.

  

	 	2.14.	“Thames Water” means Thames Water Company, the parent company of the Thames Water Group entities engaged in the water business in the United States.

 SECTION 3 
 PARTICIPANTS 
 3. The Board shall, in its sole discretion, designate those individuals who shall be Participants in the Plan. All
Participants shall receive notification of their participation in the Plan. No individual shall have a right to participation in this Plan unless that right is set out in a written notice (the “Notice”) advising that individual of his/her
selection as a participant. 
 SECTION 4 
 CALCULATION OF AWARD 
 4. Award. Each Participant shall be awarded a specific number of RWE Share
Units. That number will be based, in part, on $59.23 (the closing price of an RWE Share on March 23, 2005). The Board, in its sole discretion, shall approve the number of RWE Share Units to be awarded to each Participant. Each Participant shall
be notified of his/her Award. 
  

	 	4.1.	Value of Award. The value of the Award granted to each Participant shall be determined by multiplying the number of RWE Share Units awarded to that Participant by the closing
price of an actual RWE Share on the exchange on which those shares are then publicly traded on July 23, 2007, provided that for purposes of this Plan RWE Share price shall not exceed $90.00. The closing price of an RWE Share on July 23,
2007 shall be determined by converting Euros to Dollars based on the average starting and closing exchange rates in effect on July 23, 2007. 

  

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 SECTION 5 
 PAYMENT OF AWARD 
 5. Subject to Section 6, the Award will be paid to each Participant who is actively
employed by American Water or a Participating Company on July 24, 2007. The Award will be paid in cash no later than August 31, 2007. 
 SECTION 6 
 TERMINATION OF EMPLOYMENT; SALE OF THE COMPANY; ACQUISITIONS 
 6. Termination of Employment. If a Participant’s employment is terminated prior to July 24, 2007, payment, if any, will be made in accordance with this
Section 6. 
  

	 	6.1.	Death, Disability, Retirement. If termination of a Participant’s employment is due to death, Disability, Retirement or layoff, a prorated Award based on full
months’ participation in the Plan during the Plan Period will be paid. 

  

	 	6.2.	Termination of Employment. If a Participant’s employment terminates before July 24, 2007 for any reason other than those described in Section 6.1 above, such
Participant shall forfeit all entitlement to any Award. 

  

	 	6.3.	Transfer Between Companies. If a Participant transfers from a Participating Company to any entity a majority of whose shares or ownership interests are held directly or
indirectly by RWE, the Committee shall have the sole discretion to determine the effect of the transfer on the Participant’s Award and the amount of any payment thereof. 

  

	 	6.4.	RWE Group Members. If either Thames Water, American Water or any Participating Company ceases to be a member of the RWE Group, the Plan will continue in effect with its
terms. 

 SECTION 7 
 ADMINISTRATION 
  

	 	7.1.	Committee’s Responsibility. The Plan is administered by the Committee. The Committee has the power to adopt and revise rules relating to the Plan and to make all
necessary or desirable interpretations concerning the Plan and all decisions relating to entitlement hereunder. A majority of the members of the Committee acting at a meeting, or a majority of all members of the Committee acting by a signed
statement in writing, shall be required for the Committee to act with respect to the Plan. 

  

	 	7.2.	 Indemnification. American Water shall indemnify and hold harmless each member of the Committee from any and all claims, losses, damages, expenses (including
counsel fees) and liability (including any amounts paid in settlement of any claim or any other matter with the consent of American Water) arising from 

  

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any act or failure to act with respect to the Plan on account of such member’s service on the Committee, except in the case of gross negligence or
willful misconduct 

 SECTION 8 
 GENERAL PROVISIONS 
 8. Other provisions of this Plan are as follows: 
  

	 	8.1.	Committee Action. Any determination by the Committee in carrying out or administering the Plan is final and binding for all purposes upon the Participants and all other
interested persons and their heirs, successors and personal representatives. 

  

	 	8.2.	Withholding. Each Participating Company will withhold from any Award payable hereunder to a Participant employed by that Company an amount sufficient to satisfy any legally
required federal, state, local or foreign withholding tax requirements. 

  

	 	8.3.	No Right to Employment. No action of American Water or any Participating Company in establishing the Plan, nor any provision of the Plan, nor any action taken by American
Water, any Participating Company, the Board or the Committee under the Plan will be construed as giving to any person the right to become or to remain an employee of American Water or any Participating Company. 

  

	 	8.4.	No Transfer of Rights. Except for payment to a Participant’s estate of any part of a Participant’s Award, a Participant’s rights hereunder are not transferable
by a Participant. Any attempt to transfer, assign, pledge or dispose of in any manner the rights hereunder contrary to the provisions hereof or the levy of any execution, attachment or similar process upon a Participant’s rights shall be null
and void and without effect and shall cause the Participant’s rights to be forfeited. 

  

	 	8.5.	Unfunded; Subordination. The Plan shall be entirely unfunded and no provision shall at any time be made with respect to segregating assets of American Water or any
Participating Company for payment of any amounts hereunder. No Participant or other person shall have any interest in any particular assets of American Water or any Participating Company by reason hereof and any such Participant or other person
shall have only the rights of a general unsecured creditor of the Participating Company. American Water and any Participating Company may enter into any agreement with any other creditor subordinating all right to payment hereunder on such terms and
to such extent as American Water or Participating Company deems advisable in its sole discretion. Any such agreement shall be deemed to amend the Plan as if fully set forth herein and shall be binding upon the Participant and his/her estate.

  

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	 	8.6.	Offset. Notwithstanding anything in the Plan to the contrary, if a Participant becomes entitled to an Award under the Plan, and if at such time the Participant has
outstanding any debt, obligation, or other liability representing an amount owing to American Water or a Participating Company, then American Water, such Participating Company or the Committee may, in its sole and absolute discretion, offset such
amount owed to American Water or the Participating Company (as applicable) against the Award otherwise payable. 

  

	 	8.7.	Nature of Participation. The Plan does not and shall not give any Participant equity interest in American Water or any Participating Company, nor does it or shall it entitle
any Participant to any voting rights or dividends. 

  

	 	8.8.	Notices. Any notice to a Participant in the Plan shall be sent to the address on file with the Participating Company. Notice shall be deemed to have been received upon actual
receipt or, if sooner, five (5) days after such notice has been mailed to the Participant. 

  

	 	8.9.	Governing Law. The Plan and the rights of all persons claiming under the Plan shall be construed and determined in accordance with the laws of the State of New Jersey without
giving effect to the conflict of laws principles thereof. The courts of the State of New Jersey shall have exclusive jurisdiction in any or all actions arising under the Plan. 

  

	 	8.10.	Headings. All headings preceding the text of the Sections hereof are inserted solely for reference and shall not constitute a part of the Plan, or affect its meaning,
construction or effect. 

 SECTION 9 
 AMENDMENTS 
 9. The Board may amend the Plan or any designation hereunder, in whole or in part, at any time or
from time to time without the consent of any of the Participants; provided that an amendment made at or after the end of the Plan period may not materially adversely alter the rights of a Participant hereunder without obtaining the approval of the
affected Participants. Notwithstanding the foregoing, any amendment required by state or Federal statutes or regulations may be made at anytime without the consent of the Participants even if such amendment materially adversely alters the rights of
a Participant hereunder. 
  

	 	9.1.	Recapitalizations, etc. In the event of a reorganization, recapitalization, stock split, spin-off, split-off, split-up, stock dividend, issuance of stock rights, combination
of shares, merger, consolidation or any other change in the corporate structure of RWE affecting RWE Shares, the Committee shall adjust the number of RWE Share Units awarded hereunder as it shall determine to be reasonably necessary to maintain the
relationship between the value of an RWE Share and the value of an RWE Share Unit as in effect on the date this Plan is adopted. Any such adjustment shall be made in an equitable manner which reflects the effect of such transaction or event.

  

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 SECTION 10 
 TERMINATION 
 10. The Board may terminate the Plan (or, participation in the Plan with respect to a
Participating Company) in its sole and absolute discretion at any time without notice to the Participants. Awards made prior to termination of the Plan shall be treated in the same manner as a calculation of a prorated award and all unpaid accrued
Awards will be paid within 60 days of such Plan termination (provided that a Participant has not been terminated for Cause prior to such payment). 
 SECTION 11 
 GOVERNMENT REGULATION 
 11. Adoption, implementation and interpretation of the Plan is subject at all times to state and federal governmental statutes and regulations, and no award will be granted or paid if, in the sole opinion of the
Board, to do so would be a violation of any such statute or regulation. 
 SECTION 12 
 EFFECTIVE DATE AND DURATION 
 12. The Plan is
effective for the period beginning on January 1, 2004 and ending July 24, 2007. 
  

 - 6 -RWE Long Term Incentive Plan 2002 (LTIP), dated as of 2002

 Exhibit 10.14 
 

 

 § 1 Participation 
  

	1.	Only those senior executives who have received an allocation notice from RWE AG or one of its affiliates (together or each separately the “company”) are entitled to
participate (“eligible participant”). 

  

	2.	The stock appreciation rights (“SARs”) are awarded voluntarily by the company. Even when SARs or other instruments arc awarded repeatedly, this creates no entitlement to
any further award of SARs or to similar or equivalent instruments. 

 § 2 SARs 
  

	1.	SARs are rights that enable eligible participants to earn money based on an increase in value (profit) measured by an increase in the common stock price of RWE AG.

  

	2.	A written allocation notice will inform eligible participants of the number of SARs awarded. 

  

	3.	The SARs are not transferable, may not be sold, cannot be inherited, are not intended for trading, and may not be used as security for credit. Furthermore, it is forbidden to enter
into any business transactions that are equivalent to the sale of SARs or return business (e.g., short sale or hedge). 

 § 3 Award of
SARs, Period of Validity, Waiting Period, Exercise Period 
  

	1.	The allocation notice specifies the day upon which the SARs are awarded (“issue date”). 

  

	2.	The validity period of the SARs is five years. The waiting period of two years is followed by an exercise period of three years. Deviating from this rule, the waiting period for the
SARs awarded in the year 2002 expires in June 2004; with the exercise period being extended accordingly. During the waiting period the SARs cannot be exercised, the period of validity and the waiting period start on the day of issue. The exact dates
for waiting period and exercise period will be given in the allocation notice. 

  

	3.	The SARs cannot be exercised in the periods specified under Item 2 and § 4. 

  

	4.	If the SARs are not exercised within the exercise period, they expire without any entitlement to replacement or compensation. 

 § 4 Exercise Blackouts 
  

	1.	During the exercise period the SARs may not be exercised during certain blackout periods. Blackout periods begin three weeks prior to the date of each press conference on the
balance sheet and publication of the interim report on the first six months of the fiscal year for RWE AG, and they end at the completion of the respective day of reporting. 

  

	2.	Independent of the blackout periods mentioned, RWE AG can specify appropriate blackout periods for some or all eligible participants in any critical insider situations according to
circumstances. Furthermore, the eligible participants are obligated to comply with any insider guidelines of the company 

  

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 § 5 Exercise Price, Base Price 
  

	1	The exercise price of the SARs is determined by the average value (arithmetic mean) of the stock exchange price for a share of RWE common stock in the closing auction of XETRA
trading on the Frankfurt Stock Exchange on the ten trading days immediately preceding the date of issue (Reference Period 1). 

  

	2.	The base price of the Dow Jones STOXX Utility Price Index is determined by the average value of the closing price of this index in Reference Period 1. 

 § 6 Performance Goals 
  

	1.	In principle the SARs may be exercised at any time - except during the waiting and blackout periods specified under § 3 Item 2 and § 4, if 

 

	 	(a)	on the exercise date the 10-day average (arithmetic mean) of the stock exchange price of a share of RWE common stock in the closing auction of XETRA trading on the Frankfurt Stock
Exchange (RWE XETRA average price) shows a better stock price performance than the Dow Jones STOXX Utility Price Index, measured as a 10-day average of the closing prices in comparison to the base price of this index, when compared to the exercise
price on at least ten successive trading days, 

 and, in addition, 
  

	 	(b)	the stock exchange price of a share of RWE common stock in the closing auction of XETRA trading on the Frankfurt Stock Exchange on the last trading day prior to the exercise date
exceeds the exercise price by at least 10 percent. 

  

	2.	If the requirements of Item 1 are fulfilled, the number of exercisable SARs depends on the increase achieved in the RWE XETRA average stock price compared to the exercise price
after expiration of the waiting period. The SARs awarded to the eligible participants 

  

	 	•	 	 can all be exercised when the RWE XETRA average stock price has exceeded the exercise price by at least 20 percent on ten successive trading days,

  

	 	•	 	 can be exercised at the most to 60 percent when the RWE XETRA average stock price has exceeded the exercise price by at least 15 percent on 10 successive trading
days, 

  

	 	•	 	 can be exercised at the most to 25 percent when the RWE XETRA average stock price has exceeded the exercise price by at least 10 percent on 10 successive trading
days. 

 The prerequisites according to Item 1a need not be fulfilled, if, after expiration of the waiting period, the
RWE XETRA average stock price has exceeded the exercise price by at least 20 percent on 10 successive trading days. 
 § 7 Profit 
  

	1.	The profit is the difference between the exercise price and the stock exchange price of a sharp of RWE common stock in the closing auction of XETRA trading on the Frankfurt Stock
Exchange on the last trading day prior to the exercise date, but limited to (maximum of 50 per cent or the exercise price. 

  

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	2.	The company awarding the SARs pays the profit in the next possible salary period. 

 § 8 Exercise Declaration, Exercise Date, and other Exercise Requirements 
  

	1.	If the exercise requirements are fulfilled, the SARs can be exercised using a form provided by the company or the administrator (see § 10) as a written, irrevocable declaration
to the company (“Exercise Declaration”). Fax and e-mail suffice. 

  

	2.	The exercise date is the date the company receives the exercise declaration; if an administrator is used, it is the date the administrator receives the declaration. If received
after 7:00 p.m. (local time Essen), the following day is the exercise date. Upon receipt the SARs are considered exercised. 

  

	3.	In the exercise declaration, the eligible participant must indicate how many SARs to exercise. At least 100 SARs must be exercised per exercise declaration,

 § 9 Substitution Option of the Company 
  

	1.	The company reserves the right, instead of paying the profit, to deliver a corresponding number of shares of common stock in RWE AG, valued at the stock exchange price of RWE common
stock in the closing auction of XETRA trading on the Frankfurt Stock Exchange on the last trading day prior to the date of exercise. 

  

	2.	The company can also deliver a share of common stock of RWE AC for each SAR exercised. In this case the eligible participant is obligated to pay to the company the exercise price
for each share of common stock as well as the amount by which the difference between the exercise price and the stock exchange price of a share of RWE common stock in the closing auction of XETRA trading on the Frankfurt Stock Exchange on the last
trading day prior to the exercise date exceeds the profit (§ 7 Ziff. 1). The number of shares of common stock to be delivered corresponds to the number of SARs exercised. 

  

	3.	If the substitution option is used, the company will also adjust any differences in the rights to dividends between the common stock delivered by the company and the traded common
stock of RWE AG. All other details will be dealt with separately. 

 § 10 Technical Implementation of the LTIP 
 The company can select an administrator to handle technical implementation and administration of the LTIP and can provide this person with the information
needed to carry out and administer the LTIP, including information on individuals. In this case, the eligible participant must be informed. 
 § 11
Special Conditions in Case of 
 Termination of Work or Employment 
  

	1.	If the work or employment relationship of the eligible participant with the company ends, the SARs may be executed upon termination of the employment relationship it all the
requirements for exercise are fulfilled. If the eligible participant does not exercise the SARs or if they cannot be executed within the previously specified period, they expire without any entitlement to replacement or compensation.

  

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	2.	If the eligible participant transfers to a company that participates in the LTIP, the awarded SARs remain in effect. After the transfer, this company becomes the company awarding
the SARs (§ 7 Ziff. 2). 

  

	3.	In case of the death of the eligible participant, the SARs existing at the time of death are exercised automatically, if and to the extent that all the requirements for execution
have been fulfilled. In case of the death of the eligible participant, the date of death becomes the exercise date. No compensation is provided for SARs that cannot be executed at the time of death. 

  

	4.	Individual or general exceptions to the rule under Item 1 in favor of the eligible participant can be made by the company through written declaration. 

§ 12 Departure of the Company or Company Unit from the Corporate Group 
  

	1.	If the company or a corporate unit whose active or retired senior management personnel are holders of SARs separates from the group of affiliated companies of the RWE Corporate
Group, the SARs may be exercised up to the day before the company or corporate unit leaves the RWE Corporate Group, if all the exercise requirements are fulfilled. If the eligible participants do not exercise the SARs or if they cannot be executed
within the previously specified period, they expire without any entitlement to replacement or compensation. 

  

	2.	Individual or general exceptions to the rule under Item 1 in favor of the eligible participant can be made by the company through written declaration. 

§ 13 Costs of Implementation 
 The company will pay
the costs of implementation and administration of the LTIP. 
 § 14 Taxes, Deductions, and other Expenditures 
  

	1.	Taxes, deductions, and other expenditures that can be allocated to the individual sphere of the eligible participants, and which are connected to the issuance or execution of SARs,
shall be paid by the eligible participants. 

  

	2.	Currently in Germany, the award of SARs does not constitute a taxable capital gain. Only upon exercise of the SARs does the eligible participant achieve a taxable monetary gain.
When eligible participants subject to German tax law exercise the SARs, deductions will be made for income tax and other taxes as well as for deductions to be paid by the eligible participants, including any deductions for benefits or social
insurance, in accordance with law applicable at the time. 

  

	3.	For eligible participants subject to tax obligations outside Germany, in addition to the provisions of Item 1, the provisions of Item 2 also apply analogously, if
any tax obligation results from the issuance or exercise of the SAR or during the period of validity of the SARs, or in case the respective employer has to deduct taxes or other deductions based on applicable law. 

  

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 § 15 Stock Price Risks, Liquid Market, Tax Risks 
  

	1.	The company provides no guarantee for the general development of the market and the development of the price of a common share of RWE AC after issuance or exercise of SARs or for
any other point or period of time. In particular there is no guarantee that the eligible participant who receives SARs will achieve an economic advantage. The SARs are thus exercised solely at the risk of the respective eligible participant.

  

	2.	The company also provides no guarantee that the taxes and deductions withheld or other taxes and deductions to be paid by the eligible participant will be based only on the
difference between the exercise price and the applicable stock exchange price upon exercise of the SARs or on some other particular amount. Eligible participants are advised to seek advice from a tax consultant. 

 § 16 Adaptations Based on Changes in the Capital Stock of RWE AG 
 If during the period of validity of the SARs there are changes in the capital stock of RWE AG or restructuring measures that have a direct effect on the equity of RWE AG (e.g., spin-offs), the company is entitled, but
not obligated, to adapt the exercise price so that the total value of the SARs belonging to the eligible participant after the corresponding measures have been earned out corresponds basically to the total value of the SARs that belonged to the
eligible participant immediately before the corresponding measures were carried out. Any additional SARs issued in connection with the measure will be considered in determining the total value. 
 § 17 Limitation of Liability 
 Liability of the company
for ordinary negligence as well as any resulting consequential damages and lost profits is excluded. 
 § 18 Written Form 
 Any changes or additions to this agreement must be made in writing. This applies also to changes in this clause in written form. 
 § 19 Applicable Law, Place of Performance, and Jurisdiction 
  

	1.	The form and content of the SARs, the terms of this plan, and the allocation no tice, as well as all the resulting rights and obligations of the eligible participants or the company
are determined in all regards according to the law of the Federal Republic of Germany. 

  

	2.	To the extent legally permissible, the place of performance and jurisdiction for all legal controversies resulting from or in connection with the SARs and the matters regulated by
the terms of this plan is Essen. 

  

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 § 20 Miscellaneous 
  

	1.	If during the period of validity of the SARs there are changes in the overall conditions, which substantially impair or make impossible the execution of the terms of this plan or
individual provisions, the company is entitled, but not obligated, to make appropriate adaptations. 

  

	2.	If it should become impossible to carry out one of the provisions of the terms of this plan or the allocation notice, the validity and executability of the remaining conditions
remain unaffected. Any gap resulting from invalidity of or an inability to execute a provision or any other gaps shall be filled through supplementary interpretation of the contract, taking into consideration analogously the interests of the
eligible parties. This also applies when the measurement of performance or time (period, deadlines) is affected. In these cases, the initially agreed performance (period, deadlines) will be replaced by a legally permissible measurement that comes as
close to it as possible. 

  

	3.	Headings are for the purpose of orientation only and may not be used for interpretation. 

  

	4	The version of the original German text is binding. If there are any deviations in the terms of this plan in a language version other than German, it should be noted that the text
in the other language is for the purpose of information only. For interpretation, the version of the original German text is binding. 

  

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