EXHIBIT 10.4

THIRD AMENDMENT AND WAIVER TO

THIRD AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT

        Third Amendment and Waiver, dated as of April 14, 2003, to Third Amended
and Restated Revolving Credit Agreement (“this Amendment”), by and among IONICS,
INCORPORATED, a Massachusetts corporation (the “Borrower”), FLEET NATIONAL BANK
and the other lending institutions listed on Schedule 1 to the Credit Agreement
(as hereinafter defined) (the “Banks”), amending certain provisions of the Third
Amended and Restated Revolving Credit Agreement, dated as of June 29, 2001 (as
amended by the First Amendment and Waiver, dated as of December 21, 2001, and
the Second Amendment and Waiver, dated as of March 28, 2002, and as further
amended and in effect from time to time, the “Credit Agreement”) by and among
the Borrower, the Banks and FLEET NATIONAL BANK as agent for the Banks (in such
capacity, the “Agent”). Terms not otherwise defined herein which are defined in
the Credit Agreement shall have the same respective meanings herein as therein.

        WHEREAS, the Borrower and the Banks acknowledge that Revolving Credit
Loan Maturity Date occurred on March 26, 2003;

        WHEREAS, the Borrower has requested that the Revolving Credit Loans and
all of the Loan Documents be reinstated as of April 14, 2003, and the Banks have
agreed to reinstate the Revolving Credit Loans and all of the Loan Documents as
of such date, all of which shall be in full force and effect from and after such
date;

        WHEREAS, the Borrower and the Banks have agreed to modify and waive
certain terms and conditions of the Credit Agreement as specifically set forth
in this Amendment;

        NOW, THEREFORE, in consideration of the premises and the mutual
agreements contained herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:

        §1.  Amendments to Section 1 of the Credit Agreement.  Section 1.1 of
the Credit Agreement is hereby amended as follows:

    (a)        The definition of “Applicable Margin” contained in §1.1 of the
Credit Agreement is hereby amended by deleting such definition in its entirety
and restating it as follows:

  Applicable Margin: The Applicable Margin for (i) Prime Rate Loans shall be
zero, (ii) LIBOR Rate Loans shall be 1.25%, (iii) the Letter of Credit Fee for
Performance Letters of Credit shall be 0.875% and for all other Letters of
Credit shall be 1.25% and (iv) the Commitment Fee Rate shall be 0.25%.

    (b)        The definition of “Cash Equivalents” contained in §1.1 of the
Credit Agreement is amended by deleting such definition in its entirety and
restating it as follows:

  Cash Equivalents. As to the Borrower and its Consolidated Subsidiaries, (a)
securities issued or directly and fully guaranteed or insured by the United
States of America and having a maturity of not more than twelve (12) months from
the date of acquisition; (b) certificates of deposit, time deposits and
eurodollar time deposits with maturities of twelve (12) months or less from the
date of acquisition, bankers’ acceptances with maturities not exceeding twelve
(12) months and overnight bank deposits, in each case, (i) with any Banks or
(ii) with any domestic commercial bank organized under the laws of the United
States of America or any state thereof, in each case having a rating of not less
than A or its equivalent by Standard & Poor’s Ratings Group or any successor and
having capital and surplus in excess of $1,000,000,000 or banks organized under
the laws of any OECD country having total assets in excess of $10,000,000,000;
(c) repurchase obligations with a term of not more than seven (7) days for
underlying securities of the types described in clauses (a) and (b) above; and
(d) any commercial paper or finance company paper issued by (i) any Lender or
any holding company controlling any Bank or (ii) any other Person, including but
not limited to, any corporation organized and existing under the laws of the
United States of America or any state thereof or any OECD country, that is rated
not less than “P-1” or “A-1” or their equivalents by Moody’s Investors Services,
Inc. or Standard & Poor’s Ratings Group or their successors, in each case,
denominated in Dollars, Euros or British Pounds Sterling.

    (c)        The definition of “Revolving Credit Loan Maturity Date” contained
in §1.1 of the Credit Agreement is hereby amended by deleting such definition it
in its entirety and restating it as follows:

      Revolving Credit Loan Maturity Date.  April 30, 2004.

    (d)        Section 1.1 of the Credit Agreement is further amended by
inserting the following new definition in the appropriate alphabetical order:

  Performance Letter of Credit. A standby Letter of Credit issued for the
account of the Borrower to secure the performance (other than payment) of the
Borrower or its domestic Subsidiaries.

      §2.  Amendments to Section 10 of the Credit Agreement.  

    (a)        Section 10.1 of the Credit Agreement is hereby amended by
deleting such §10.1 in its entirety and substituting the following therefor:

      10.1  Intentionally Omitted.

    (b)        Section 10.5 is amended by deleting such §10.5 and substituting
the following therefor:

      10.5  Intentionally Omitted.

        §3.  Amendment to Schedule I to the Credit Agreement. Schedule I to the
Credit Agreement is hereby amended by deleting such Schedule I and substituting
Schedule I attached hereto therefor.

        §4.  Limited Waiver. The Borrower has informed the Agent and the Banks
that the Borrower has failed to comply with the covenants set forth in §§10.1
and 10.5 of the Credit Agreement for the Reference Period ended 12/31/02, and
has requested that the Banks waive such non-compliance. As of the Effective
Date, the Banks hereby waive compliance with the provisions of §§10.1 and 10.5
of the Credit Agreement solely for the Reference Period ended 12/31/02, and
accordingly the Banks deem such non-compliance to have been subsequently cured.
Nothing contained in this waiver shall be construed to imply a willingness on
the part of the Banks to grant any similar or other future waivers of any of the
terms and conditions of the Credit Agreement or the other Loan Documents.

        §5.  Conditions to Effectiveness. This Amendment shall be effective as
of April 14, 2003 (the “Effective Date”), subject to the satisfaction of the
following conditions:

    (a)        The Borrower, the Banks and the Agent shall have executed and
delivered to the Agent this Amendment.

    (b)        The Agent shall have received an amendment fee in the amount of
$37,500.

    (c)        All proceedings in connection with the transactions contemplated
by this Amendment and all documents incident thereto shall be reasonably
satisfactory in substance and form to the Banks and the Agent, and the Agent
shall have received all information and such counterpart originals or certified
or other copies of such documents as the Agent may reasonably request.

    (d)        The Borrower shall have paid all other fees and expenses required
to be paid on or prior to the date hereof.

        §6.  Condition Subsequent.  The Borrower shall have delivered to the
Agent no later than May 31, 2003, resolutions of the Board of Directors of each
of the Borrower and its domestic Subsidiaries (other than the Inactive
Subsidiaries) evidencing its authorization of such entity’s execution and
delivery of this Amendment and the obligations contemplated therein along with
an officer’s certificate with respect thereto. The Borrower hereby agrees with
the Agent and the Banks that failure to provide the aforementioned resolutions
on or prior to the date specified herein shall constitute an Event of Default
under the Credit Agreement.

        §7.  Representations and Warranties. The Borrower hereby repeats, on and
as of the Effective Date, each of the representations and warranties made by it
in §7 of the Credit Agreement (except to the extent of changes resulting from
transactions contemplated or permitted by this Amendment, the Credit Agreement
and the other Loan Documents and changes occurring in the ordinary course of
business that singly or in the aggregate are not materially adverse, and to the
extent that such representations and warranties relate expressly to an earlier
date), provided, that all references therein to the Credit Agreement shall refer
to such Credit Agreement as amended hereby. In addition, the Borrower hereby
represents and warrants that the execution and delivery by the Borrower and its
Subsidiaries of this Amendment and the performance by the Borrower and its
Subsidiaries of all of its agreements and obligations under the Credit Agreement
as amended hereby are within the corporate or other authority of each of the
Borrower and its Subsidiaries and have been duly authorized by all necessary
corporate or other action on the part of the Borrower and its Subsidiaries.

        §8.  Ratification, Etc. Except as expressly amended hereby, the Credit
Agreement and all documents, instruments and agreements related thereto,
including, but not limited to the other Loan Documents, are hereby reinstated,
ratified and confirmed in all respects and shall continue in full force and
effect. The Credit Agreement and this Amendment shall be read and construed as a
single agreement. All references in the Credit Agreement or any related
agreement or instrument to the Credit Agreement shall hereafter refer to the
Credit Agreement as amended hereby.

        §9.  No Waiver. Except as set forth in §4, nothing contained herein
shall constitute a waiver of, impair or otherwise affect any Obligations, any
other obligation of the Borrower or any rights of the Agent or the Banks
consequent thereon.

    §10.  Counterparts.        This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original but which together shall
constitute one and the same instrument.

        §11.  Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS (WITHOUT
REFERENCE TO CONFLICT OF LAWS).

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

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        IN WITNESS WHEREOF, the parties hereto have executed this Amendment as a
document under seal as of the date first above written.

IONICS, INCORPORATED

BY: /S/ Daniel M. Kuzmak
——————————————
Daniel M. Kuzmak
Chief Financial Officer

FLEET NATIONAL BANK, Individually and as Agent

BY: /S/ John C. Dunne
——————————————
John C. Dunne
Senior Vice President

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RATIFICATION OF GUARANTY

        Each of the undersigned Guarantors hereby acknowledges and consents to
the foregoing Amendment, including but not limited to, the reinstatement of the
Revolving Credit Loans and all of the Loan Documents, as of April 14, 2003, and
agrees that the Guaranty to which such Guarantor is a party remains in full
force and effect, and each of the Guarantors confirms and ratifies all of its
obligations thereunder.

AQUA DESIGN, INC.

BY: /S/ Daniel M. Kuzmak
——————————————
Daniel M. Kuzmak
Treasurer

FIDELITY PUREWATER, INC.

BY: /S/ Anthony Di Paola
——————————————
Anthony Di Paola
Treasurer

FIDELITY WATER SYSTEMS, INC.

BY: /S/ Anthony Di Paola
——————————————
Anthony Di Paola
Treasurer

IONICS KOREA, INC.

BY: /S/ Stephen Korn
——————————————
Stephen Korn
Secretary

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IONICS LIFE SCIENCES, INC.

BY: /S/ Theodore G. Papastavros
——————————————
Theodore G. Papastavros
Treasurer

IONICS ULTRAPURE WATER CORPORATION

BY: /S/ Stephen Korn
——————————————
Stephen Korn
Secretary

RESOURCES CONSERVATION CO. INTERNATIONAL

BY: /S/ Stephen Korn
——————————————
Stephen Korn
Secretary

SEPARATION TECHNOLOGY INC.

BY: /S/ Ark W. Pang
——————————————
Ark W. Pang
President

SIEVERS INSTRUMENTS, INC.

BY: /S/ Stephen Korn
——————————————
Stephen Korn
Secretary

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                                           SCHEDULE 1
                                    Bank Commitments and Commitment Percentages

         ------------------------------------------------ -------------------- ----------------------
                                                                                Revolving
                                                          Revolving             Credit
         Domestic and LIBOR                               Credit                Commitment
         Lending Office                                   Commitment            Percentage
         ------------------------------------------------ -------------------- ----------------------

         Fleet National Bank                              $15,000,000          100.00000%
         100 Federal Street
         Boston, MA 02110
         Attn:  John C. Dunne
         Senior Vice President
         ------------------------------------------------ -------------------- ----------------------
         TOTAL                                            $15,000,000          100.00000%
         ------------------------------------------------ -------------------- ----------------------