Exhibit 10.2

 

[logo.jpg]

CONSULTING AGREEMENT

 

THIS AGREEMENT is made effective as of April 1, 2015 by and between Energy
Recovery Inc. a Delaware corporation having its principal place of business
located in San Leandro California 94577 (“Company”) and Thomas S. Rooney, Jr.,
an individual residing in California (“Consultant”).

 

RECITALS

 

A.     Consultant desires to provide an advisory role to Company, and Company
desires to have such services performed by Consultant;

 

B.     Consultant’s specific services are not currently part of Company’s core
business and therefore Company needs to contract independently for Consultant’s
specific skill set; and

 

C.     Company does not retain the authority to direct the day-to-day
performance of Consultant’s services, but rather is requesting certain tasks to
be accomplished by Consultant based upon Consultant’s specific skill set and
expertise.

 

NOW, THEREFORE, for and in consideration of the mutual promises and covenants
hereinafter set forth, the parties hereto agree as follows:

 

 

1.

SERVICES, CONSIDERATION AND TERM

 

(a)     Services: Consultant shall perform for Company services described in
Exhibit A attached hereto and incorporated herein by reference (“Services”) and
other such Services as Company may prescribe.

 

(b)     Consideration: Irrespective of whether the Company has requested any
Services for any given month, it shall pay Consultant Eight Thousand Dollars
($8,000) a month plus reimbursement of the Consultant’s portion of the premium
for benefit coverage continuation under COBRA as provided under the Company’s
group health plan in effect for the Consultant immediately prior to the date of
his employment termination with the Company for the period commencing on the
first day of the Term and ending on the earliest of the last date of the Term,
the date the Consultant is no longer eligible to receive COBRA continuation
coverage and the date on which the Consultant first becomes eligible for
benefits of the same type under a plan or plans provided by a subsequent
employer. In addition, during the Term, Consultant shall continue to be eligible
to vest in any stock options granted to the Consultant under the Company’s
Amended and Restated 2008 Equity Incentive Plan that were unexpired and
outstanding as of the last date of his employment with the Company (the
“Outstanding Options), and all Outstanding Options shall continue to be
exercisable through the 90-day period following the last day of the Term.

 

 
 

--------------------------------------------------------------------------------

 

 

(c)     Term: This Agreement shall become effective as of the date first set
forth above and shall remain in full force and effect for eighteen (18) months
thereafter until October 1, 2016, or until the Agreement is terminated in
accordance with Paragraph 7.

 

 

2.

CONFLICTING OBLIGATIONS

 

Consultant confirms that Consultant has not executed nor is bound by, or party
to, any non-compete covenant, restriction, or other agreement, contractual or
otherwise, with any prior or current employer, supplier, customer or firm with
which the Consultant has been associated and which would prevent Consultant from
working with Company in the capacity as stated herein, or otherwise impede or
restrict the fulfillment of the terms of this Agreement with Company.

 

 

3.

INDEPENDENT CONSULTANT

 

(a)     Independent Consultant Status: It is the express intention of the
parties that Consultant is an independent consultant and not an employee, agent,
representative, joint venturer or partner of the Company. Nothing in this
Agreement shall be interpreted or construed as creating or establishing the
relationship of employer and employee between Company and Consultant or any
employee or agent of Consultant. The parties acknowledge that Consultant is not
an employee for state or federal tax purposes. Consultant is obligated to report
as income all income received by Consultant pursuant to this Agreement, and
Consultant agrees to and acknowledges the obligation to pay all self-employment
and other taxes thereon including applicable federal, state and local income
taxes, unemployment insurance, workers’ compensation insurance, disability
insurance, Social Security taxes and other charges. Consultant further agrees to
indemnify Company and hold Company harmless from any and all claims made by any
entity on account of an alleged failure by Consultant or Company to satisfy such
withholding or other obligation. Consultant shall not hold himself out to
Company employees or third parties as a Company employee or agent.

 

(b)     Consultation for Others: Nothing in this Agreement shall preclude
Consultant from exploring or accepting other employment or consulting
opportunities during the term of this Agreement provided that such engagement
does not create a conflict of interest with Consultant’s obligations to Company.
Specifically, none of Consultant’s services during the term of this Agreement
for any other entity and/or person shall compete with or compromise in any way
the Company’s “Confidential Information” as defined in Paragraph 4(a) below.
Further, Consultant must at all times comply with Paragraph 4 below.

 

(c)     Time, Places and Methods of Providing Services: As long as Consultant
delivers acceptable services to Company in a timely fashion, Consultant shall
generally have the discretion to determine the location and times of rendering
services as well as the method of accomplishing Consultant’s Services.

 

(d)     Records and Invoices: Consultant shall keep complete and systematic
written records of all work relating to the performance of Services by
Consultant hereunder and shall submit monthly invoices to Company’s accounts
payable for all Services rendered.

 

(e)     Equipment, Instruments, Documentation and Specifications: Consultant
shall supply all equipment, instruments, documentation and specifications
required to perform Services under this Agreement, except when such equipment,
instruments, documentation and specifications are unique to Company, in which
case Company shall provide Consultant with such equipment, instruments,
documentation and specifications as may reasonably be required by Consultant for
performance by Consultant of duties set forth herein. Such equipment,
instruments, documentation and specifications shall at all times remain the
property of Company.

 

CONSULTING AGREEMENT
2

--------------------------------------------------------------------------------

 

 

 

4.

CONFIDENTIAL INFORMATION

 

(a)     Definition: “Confidential Information” means any of the Company’s
(including its parents’, affiliates’ or subsidiaries’) proprietary information,
technical data, trade secrets or know-how, including but not limited to all
actual or potential customer, employee, supplier, and distributor lists,
contacts and addresses, information about employees and employee relations,
training manuals and procedures, information about recruitment method and
procedures, employment contracts, employee handbooks, information about
marketing, business plans and projections, price lists, information about costs
and expenses, budgets, proposals, financial information, product plans,
products, services, research, developments, systems, formulas, technology,
inventions, data bases, know how, developments, experiments, improvements,
prototypes, computer programs, software, devices, patterns, processes, designs,
source codes, mask-works, drawings, engineering, hardware configuration
information, manufacturing methods, distribution techniques, specifications,
tapes, and compilations of information that are owned by Company, parents,
affiliates or subsidiaries of Company, other parties with which Company does
business (“Third Parties”) or customers of Company, and that are used in the
operation of Company’s, Third Parties’ and/or a customer’s business.
Confidential Information includes, but is not limited to, information disclosed
to or developed by Consultant in connection with the Services. Confidential
Information shall not include information that: (i) is now or subsequently
becomes generally available to the public through no wrongful act or omission of
Consultant; (ii) Consultant can demonstrate to have had rightfully in its
possession prior to disclosure to Consultant by Company; (iii) is independently
developed by Consultant without use, directly or indirectly, of any Confidential
Information; or (iv) Consultant rightfully obtains from a third party who has
the right to transfer or disclose it.

 

(b)     Non-Use and Non-Disclosure: Except to the extent necessary to perform
Services, Consultant shall not reproduce, use, distribute, disclose or otherwise
disseminate Confidential Information. Consultant shall not take any action
causing, or fail to take any reasonable action necessary to prevent, any
Confidential Information to lose its character as Confidential Information.
Consultant shall not remove Confidential Information from Company or the
location(s) designated by Company except as expressly permitted by Company in
writing.

 

Consultant agrees that access to Confidential Information will be limited to
those authorized representatives of Consultant who: (1) need to know such
Confidential Information in connection with their provision of Services; and (2)
have signed agreements with Consultant obligating them to maintain the
confidentiality of information disclosed to them and designated or defined as
confidential. Consultant further agrees to inform authorized representatives of
the confidential nature of Confidential Information and agrees to take all
necessary steps to ensure that the terms of this Agreement are not violated by
them.

 

Additionally, Consultant agrees not to use any Developments, as defined in
Paragraph 5(b), in connection with any project that Consultant undertakes for
Consultant or for any party other than Company without the prior express written
approval of Company in each instance.

 

CONSULTING AGREEMENT
3

--------------------------------------------------------------------------------

 

 

(c)     Former Employer’s Confidential Information: Consultant shall not, during
the term of this Agreement, improperly use or disclose any proprietary
information or trade secrets of any former or current employer or other person
or entity with which Consultant has an agreement or duty to keep in confidence
information acquired by Consultant in confidence, if any, and Consultant will
not bring onto the premises of Company any unpublished document or proprietary
information belonging to such employer, person or entity, unless consented to in
writing by such employer, person or entity. Consultant will indemnify Company
and hold Company harmless from and against all claims, liabilities, damages and
expenses, including reasonable attorneys’ fees and costs of suit, arising out of
or in connection with any violation or claimed violation of a third party’s
rights resulting in whole or in part from Company’s use of the work product of
Consultant under this Agreement.

 

(d)     No Export: Consultant acknowledges that Confidential Information or
other information disclosed in connection with the Services might be considered
technical data that is subject to compliance with the export control laws and
regulations of the United States, and hereby agrees to comply with such laws.

 

(e)     Return of Company Property and Information: Upon termination of this
Agreement or upon request by Company, Consultant shall promptly deliver to
Company any and all Company property and Confidential Information in
Consultant’s, or Consultant’s agent’s possession, custody or control. Consultant
agrees to sign and deliver the Termination Certification attached hereto as
Exhibit B.

 

 

5.

INTELLECTUAL PROPERTY RIGHTS

 

(a)     Assignment: Consultant has attached hereto, as Exhibit C, a list
describing all inventions, original works of authorship, developments,
improvements, and trade secrets that were made by Consultant prior to the date
hereof, that belong to Consultant and that relate to Company’s proposed business
and products, and that are not assigned to Company; or, if such list is not
attached or is left blank, Consultant represents that there are no such
inventions.

 

All Confidential Information shall remain the property of Company and no license
or other right to such information is granted or implied hereby. The Services
and all Confidential Information developed in connection therewith shall be the
sole and exclusive property of Company. In the event such Services or
Confidential Information developed in connection therewith is deemed not to be
the property of Company, Consultant hereby assigns all rights thereto to Company
and hereby agrees to sign all instruments reasonably necessary in the opinion of
Company to eliminate any ambiguity as to ownership by Company.

 

(b)     Further Assurances: Consultant agrees that all ideas, techniques,
inventions, systems, formulae, business and/or marketing plans, projections or
analyses, discoveries, technical information, programs, prototypes, and similar
developments, improvements or creations developed, conceived, created,
discovered, made, written or obtained by Consultant in the course of or as the
result, direct or indirect, of the performance of Consultant’s duties hereunder
(hereinafter called “Developments”), and all related intellectual property
rights, including but not limited to writings and other works of authorship,
United States and/or foreign letters, patents, maskworks, copyright or trademark
registrations and/or other forms of protection thereof, shall be and remain the
property of Company, its parents, affiliates or subsidiaries. Consultant further
agrees to assign (or cause to be assigned) and does hereby assign fully to
Company all such Developments and any copyrights, patents, maskwork rights or
other intellectual property rights relating thereto. Consultant, insofar as
Consultant has the right to do so, agrees that Consultant will execute or cause
to be executed such United States and/or foreign letters, patents, maskworks,
copyright or trademark registrations and other documents and agreements and take
such other action as may be desirable in the opinion of Company to enable
intellectual property, copyright and/or other forms of protection for
Developments to be obtained, maintained, renewed, preserved and protected
throughout the world by or on behalf of Company.

 

CONSULTING AGREEMENT 
4

--------------------------------------------------------------------------------

 

 

(c)     Pre-Existing Materials: Consultant agrees that if in the course of
performing the Services, Consultant incorporates into any invention developed
hereunder any invention, improvement, development, concept, discovery or other
proprietary information owned by Consultant or in which Consultant has an
interest, (i) Consultant shall inform Company, in writing, before incorporating
such invention, improvement, development, concept, discovery or other
proprietary information into any invention; and (ii) Company is hereby granted
and shall have a nonexclusive, royalty-free, perpetual, irrevocable, worldwide
license to make, have made, modify, use and sell such item as part of or in
connection with such invention. Consultant shall not incorporate any invention,
improvement, development, concept, discovery or other proprietary information
owned by any third party into any invention without Company’s prior written
permission.

 

6.     NON-SOLICITATION

 

Consultant agrees that during the term of this Consulting Agreement, he shall
not compete or solicit directly or indirectly customers of the Company on his
own behalf or on behalf of any other company, person or entity without the
written approval of the Company. Said approval shall not unreasonably be
withheld so long as Consultant is contacting ssaid customers about Consultant’s
own employment opportunities, provided that that these customers are not
competitors and that Consultant abides by all of Consultant’s confidentiality
obligations to the Company.

 

For a period of two (2) years after the termination of this Agreement, in any
State in the United States in which Company does business, or equivalent
geographical subdivision in any foreign jurisdiction in which Company does
business, Consultant will not directly or indirectly solicit or induce employees
or agents of Company to terminate their employment with or services for Company.

 

7.     TERMINATION

 

(a)     Termination By Consultant Upon Notice: Consultant may terminate this
Agreement by mutual agreement upon five (5) calendar days’ written notice to
Company. Upon such Consultant Notice, termination all rights and duties of the
parties toward each other shall cease except as to Consultant’s maintenance of
Confidential Information and except that Company shall be obliged to pay, within
thirty (30) days of the effective date of termination, for all satisfactory
Services completed by Consultant through the date of notice of termination. If
work in progress, Company shall be liable for only the pro-rata portion of the
completed work and for incurred pre-approved expenses, if any.

 

(b)     Termination By Company Upon Notice: Company may terminate this Agreement
immediately for Cause. As used in this Agreement, “Cause” means:

 

 

(i)

Any act by Consultant which would constitute a crime or violation of the
Company’s Code of Ethics;

 

CONSULTING AGREEMENT 
5

--------------------------------------------------------------------------------

 

 

 

(ii)

Consultant’s failure to carry out the duties and responsibilities in the manner
prescribed by the Board or Consultant’s taking action on behalf of the Company
in excess of that authority granted to him by the Board;

 

 

(iii)

Consultant’s dishonesty toward or fraud upon the Company;

 

 

(iv)

Consultant's violation of non-compete or non-solicitation obligations to the
Company as set forth herein; or

 

 

(v)

Consultant's violation of confidentiality obligations to the Company or its
past, current or potential customers or investors or misappropriation of Company
assets.

 

(c)     Method of Notice: Any notice or other communication to be given by
Company to Consultant hereunder shall be in writing and shall be deemed received
when personally delivered or mailed by certified or registered mail with return
receipt requested, and shall be addressed to Consultant at Consultant’s address
last provided to the Company or to such other address as may have been furnished
in writing. Any notice or other communication to be given by Consultant to the
Company hereunder shall be in writing and mailed by certified or registered mail
with return receipt requested, and shall be addressed to Company at its
principal corporate offices, attention CEO.

 

(d)     Automatic Termination: This Agreement shall terminate automatically on
the occurrence of bankruptcy or insolvency of either party, by death of
Consultant or by assignment of this Agreement except as provided under Paragraph
8(e).

 

(e)     Continuation of Obligations: Consultant agrees that all obligations
under Paragraph 4 of this Agreement shall continue in effect after termination
of the Agreement and those provisions of Paragraph 6 as specified in this
Agreement. Consultant will notify any future customers, potential customers or
employers of Consultant’s obligations under this Agreement and that Company will
be entitled to notify any such person or entity of Consultant’s obligations.

 

8.     MISCELLANEOUS

 

(a)     Injunctive Relief: Consultant acknowledges that any unauthorized
disclosure or use of Confidential Information would constitute a material breach
of this Agreement and may cause great or irreparable injury to Company for which
pecuniary compensation would not afford adequate relief, or that it would be
extremely difficult to ascertain the amount of the compensation that would
afford adequate relief. Therefore, in the event of such breach, Consultant
agrees that Company will have the right to seek and obtain injunctive relief in
addition to any other rights and remedies it may have.

 

(b)     Governing Law and Venue: This Agreement shall be deemed to be a contract
made under, and shall be governed and construed in accordance with, the laws of
the State of California. The federal courts or state courts of the State of
California, County of Alameda, shall have exclusive jurisdiction to adjudicate
any dispute arising out of this Agreement, and the parties hereto consent to the
jurisdiction of said courts and waive any objection to said venue.

 

(c)     Entire Agreement: This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter herein. Any and
all written or oral agreements heretofore existing between the parties hereto
with respect to the subject matter hereof are expressly canceled. No
modification, amendment or waiver of any of the provisions of this Agreement
shall be effective unless made in writing specifically referring to this
Agreement and duly signed by an authorized officer or agent for each party
hereto.

 

CONSULTING AGREEMENT 
6

--------------------------------------------------------------------------------

 

 

(d)     Severability: The invalidity or unenforceability of any particular
provision of this Agreement shall not affect the other provisions hereof, all of
which shall remain enforceable in accordance with their terms. Should any of the
obligations created hereunder be found illegal and unenforceable for being too
broad with respect to the duration, scope, or subject matter thereof, such
obligation shall be deemed and construed to be reduced to the maximum duration,
scope or subject matter permitted by law.

 

(e)     Assignability: Neither party shall assign, transfer or sell its rights
under this Agreement or delegate its duties hereunder without the prior express
written consent of the other party, and any attempted assignment or delegation
shall be void and without effect; provided, however, that Company may assign
this Agreement to any person or entity acquiring its business and assets.

 

(f)     Attorneys’ Fees and Court Costs: If any action at law or in equity is
necessary to enforce or interpret the terms of this Agreement, the prevailing
party shall be entitled to reasonable attorneys’ fees, costs and necessary
disbursements in addition to any other relief to which it may otherwise be
entitled.

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the day and year first written above.

 

 

 

 

____________________________________

Thomas S. Rooney, Jr.

 

Address:

____________________________________

_____________________________________

 

Taxpayer ID Number: __________________

Accepted and Agreed to:

ENERGY RECOVERY INC.

 

 

By: ________________________________

Hans Peter Michelet

Chairman of the Board of Directors

 

 

CONSULTING AGREEMENT
7

--------------------------------------------------------------------------------

 

 

EXHIBIT A

 

 

 

●

Services. The Services provided by Consultant to Company shall include, but
shall not be limited to, the following:

 

 

●

complete access and full cooperation with any internal investigation:

 

 

●

complete access and full cooperation with Company’s response in any legal
proceedings including but not limited to Borja Blanco, Tal Hanuka and other
cases or proceedings in which Consultant has material information and knowledge

 

 

●

complete access and full cooperation with the Company's auditors, preparation
and signing of Company’s form 10-K or other reporting obligations for which
Consultant has material information and knowledge.

 

 

●

Consultant shall not hold himself out as an employee or an agent for the
Company, participate in calls or meetings with employees, current or potential
customers, current or potential investors, press or others unless expressly
authorized to do so in writing by the CEO.

 

CONSULTING AGREEMENT 
8

--------------------------------------------------------------------------------

 

 

EXHIBIT B

 

 

CERTIFICATION OF RETURN OF COMPANY PROPERTY AND INFORMATION

 

This is to certify that I do not have in my possession, nor have I failed to
return, any devices, records, software, data, notes, reports, proposals, lists,
and sources of customers, lists of employees, proposals to customers, drafts of
proposals, business plans and projections, reports, job notes, correspondence,
specifications, drawings, blueprints, sketches, materials, equipment, other
documents or property, or reproductions of any aforementioned items belonging to
Energy Recovery, Inc., its subsidiaries, affiliates, successors or assigns
(together, the “Company”).

 

I further certify that I have complied with all terms of the Company’s
confidential and proprietary information provisions in the Consulting Agreement
signed by me, including the reporting of any inventions and original works of
authorship conceived or made by me (solely or jointly with others) covered by
that Agreement.

 

I further agree that, in compliance with the Consulting Agreement, I will
preserve as confidential all trade secrets, confidential knowledge, data or
other proprietary information relating to products, processes, know-how,
designs, formulas, developmental or experimental work, computer programs, data
bases, other original works of authorship, customer lists, business plans,
financial information or other subject matter pertaining to any business of the
Company or any of its customers, consultants or licensees.

 

 

Date:

 

 

     

 

Thomas S. Rooney, Jr.                       Signature

 

CONSULTING AGREEMENT 
9

--------------------------------------------------------------------------------

 

 

EXHIBIT C

 

 

LIST OF PRIOR INVENTIONS
AND ORIGINAL WORKS OF AUTHORSHIP

 

 

 

TITLE

DATE

IDENTIFYING NUMBER

OR BRIEF DESCRIPTION

     

 

 

 CONSULTING AGREEMENT

 10