February 14, 2011
Mr. Gonzalo G. Pique
c/o Energy Recovery, Inc.
1717 Doolittle Drive
San Leandro, CA. 94577
Via Email: firstname.lastname@example.org
Re: Resignation Acceptance and Separation Package
As Chairman of the Compensation Committee of the Board of Directors of Energy Recovery, Inc., I am
writing to accept your resignation as president and chief executive officer of Energy Recovery,
Inc. (Company or ERI) effective February 15, 2011, in order to reduce your responsibilities
with the Company in prelude to retirement. As you know, your successor, Thomas S. Rooney, Jr.,
will join ERI as its new president and chief executive officer on February 16, 2011.
As we have agreed, you will remain an employee through May 13, 2011 to assist with the leadership
transition. Through that date, you will continue to receive your current salary at the base annual
rate of $350,000 and standard Company benefits. You will remain on the Board of Directors through
June 10, 2011, the end of your current term. At the conclusion of your employment, you will be
engaged on a consulting basis, as an advisor to the Board of Directors, through April 15, 2013. As
a consultant, you will receive an annual fee of $25,000 and your stock options will continue to
In addition, on February 10, 2011, the Compensation Committee of the Companys Board of Directors
approved cash retirement compensation for you in the total amount of $565,000, in exchange for your
execution of the Companys standard form of employee release agreement within twenty-one (21) days
of your termination date. This cash retirement compensation will be paid in two installments. You
will receive the first payment in the amount of $240,000 ten days after the Companys receipt of
your signed, unrevoked release agreement. You will receive the second payment of $325,000 on
February 15, 2012. In the event of a Change in Control, as that term is defined in the Energy
Recovery Inc. Change in Control Severance Plan, the consummation of which anticipated to occur
prior to the first and/or second payment, and the successor entity does not agree to assume the
obligation to pay any unpaid amount of the cash retirement compensation, then such unpaid amount
will be paid by ERI prior to the Change in Control event.
Please accept these separation and retirement terms and benefits by signing this letter below and
returning the signed copy to the Companys Human Resources Department.
We truly thank you for your significant and lasting contributions to ERI and wish you all the best.
/s/ Arve Hanstveit
Chairman of the Compensation Committee of the
Board of Directors of Energy Recovery, Inc.
||/s/ G.G. Pique
||G. G. Pique