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                                                                    EXHIBIT 10.1


                      (INSITUFORM TECHNOLOGIES LETTERHEAD)



December 1, 2003


Mr. Christian G. Farman
245 East 93rd Street, Apartment 32 B
New York, NY  10128

Dear Chris:

Subject to Compensation Committee and Board of Director approval, we are pleased
to offer you the position of Vice President and Chief Financial Officer of
Insituform Technologies, Inc. ("ITI" or "Insituform"). The principal terms and
conditions of the offer are as follows:

1. Base Salary. The annual base salary for the position of Vice President and
Chief Financial Officer will be $265,000. Your base salary will be reviewed on
an annual basis by the Compensation Committee of the Board of Directors of ITI.

2. Stock Options. You will be granted 12,500 stock options shortly after you
begin fulltime employment with Insituform. Such options become exercisable with
respect to 25% of such shares on the grant date and on each of the first, second
and third anniversaries of the grant date. The strike price for the options will
be the closing market price of the common stock on the date your options are
granted by the Compensation Committee, which is expected to be the first day of
your active employment with ITI. The options will expire on the seventh
anniversary of the grant date. To the maximum extent permitted under the
limitations contained in the Internal Revenue Code, the options will be
"incentive stock options," with the remainder being non-qualified stock options.

3. Annual Incentive Bonus. During 2004, you will be entitled to receive an
annual incentive bonus in an amount calculated as a percentage of your base
salary determined by reference to: (i) a range of percentages identified by the
Compensation Committee based upon a center point objective of 50% (intended to
provide an opportunity of up to two times such center point) and (ii) the
accomplishment by ITI of such annual goals attendant to such range as shall also
have been determined by the Compensation Committee. The foregoing annual goals
will be determined as reasonable targets given ITI's results of operations and
prospects, intended to provide you with incentives to achieve such performance.
The amount and criteria for your annual incentive bonus will be reviewed
annually by the Compensation Committee.

4. Long Term Incentives. You are eligible to participate in the Insituform
Technologies, Inc. Long-Term Incentive Plan (the "LTIP"), which includes both
equity and cash compensation. Equity grants are made under the Insituform
Technologies, Inc. 2001 Employee Equity Incentive Plan. LTIP grants for officers
are determined by the Compensation Committee on an annual basis. Specific
information concerning the actual grants will be communicated to you when
approved by the Compensation Committee, anticipated to take place during the
first half of 2004. Any cash award is based on the achievement of goals
established by the Compensation Committee.

5. Deferred Compensation. You are eligible to participate in the Senior
Management Voluntary Deferred Compensation Plan (the "DCP"). Tax deferred
contributions may be made into the DCP after the maximum allowable contribution
(as defined by the IRS) has been made into ITI's 401(k) plan. The first 3% of
DCP contributions are matched by ITI at 100% and the next 2% of contributions
are matched at a 50% rate. The maximum company match into both the 401(k) and
DCP together is $8,000.

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Mr. Christian G. Farman
December 1, 2003
Page 2

6. Additional Benefits.

(a) You will be provided with a car allowance of $850 per month, subject to
adjustment in accordance with ITI's policy.

(b) You are eligible to participate in the company's medical, dental, vision,
life insurance, and long-term disability plans, and any future plans and
programs implemented by ITI for its employees generally or by the Compensation
Committee for you specifically, and in the ITI 401(k) Profit Sharing Plan and
any future plans or programs supplemental to the ITI 401(k) Profit Sharing Plan.
Details about specific benefits will be provided to you in benefit plan
documents.

(d) You will receive holidays in accordance with ITI's policy. During 2004, you
will receive three weeks vacation. During your fifth year of employment and
beyond, you will receive four weeks vacation.

(e) You will be provided relocation assistance as provided for in ITI's
relocation policy, including reimbursement for the cost of temporary
accommodations and weekly travel to and from your current home for a mutually
agreeable period prior to relocating your family to St. Louis. Your relocation,
including the sale of your home, must be handled through ITI's relocation
coordinator.

7. Severance. As Vice President and Chief Financial Officer, you will report to
the Chief Executive Officer and you will serve at the pleasure of the ITI Board
of Directors; however, if your employment is terminated by ITI for reasons other
than "cause" (as defined below) during your first twenty-four months' of
employment, you will receive, upon such termination, a severance payment equal
to twelve months' base salary, car allowance and medical/dental benefits, and
reasonable outplacement assistance.

The amount of "base salary" will be calculated as the product obtained by
multiplying (i) the number of months of severance to which you are entitled by
(ii) your highest monthly base salary during the twelve months prior to
termination.

"Cause" shall be defined as:

         (i) your willful and continued failure to perform substantially your
         duties with ITI or any of its affiliates (other than such failure
         resulting from incapacity due to physical or mental illness), after a
         written demand for substantial performance is delivered to you by the
         Chairman of the Board of Directors which specifically identifies the
         manner in which the Board of Directors believes that you have not
         substantially performed your duties; or

         (ii) your willful engaging in illegal conduct or gross misconduct which
         is materially and demonstrably injurious to ITI, whether or not
         subsequently discontinued or corrected; or

         (iii) your conviction of a crime other than misdemeanor traffic
         offenses or commission of an act of moral turpitude; or

         (iv) your inability to report for work for a period of four months or
         greater.

No act or failure to act, on your part, shall be considered "willful" unless it
is done, or omitted to be done, by you in bad faith or without reasonable belief
that your action or omission was in the best interests of ITI. The


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Mr. Christian G. Farman
December 1, 2003
Page 3

cessation of employment shall not be deemed to be for "cause" unless and until
there shall have been delivered to you a copy of a resolution duly adopted by
the affirmative vote of no less than a majority of the entire membership of the
Board of Directors, finding that, in the good faith opinion of the Board of
Directors, you are guilty of the conduct described.

8. Confidentiality and Non-Competition; Code of Conduct; Drug Testing;
Background Check. You must sign ITI's standard Employee Confidentiality, Work
Product and Non-Competitive Agreement. You must sign and agree to abide by ITI's
Business Code of Conduct. You must successfully pass ITI's standard drug/alcohol
screen, verification of academic credentials, reference and background checks.

This letter (and the terms of the plans, documents and standard agreements
referred to herein) contains the entire agreement of the parties with respect to
the subject matter hereof, and supersedes any and all prior understandings,
commitments and agreements with respect thereto. The terms of this letter (but
not the standard agreements referred to herein) will expire when the severance
provisions expire.

Your appointment as Vice President and Chief Financial Officer will not be
effective until your first day of active employment with ITI at its executive
offices in Chesterfield, Missouri, which must occur within four weeks of the
date of this letter.

If the above terms accurately reflect your understanding and agreement, please
sign this letter where indicated below and return it to me acknowledging your
acceptance.

Very truly yours,

INSITUFORM TECHNOLOGIES, INC.


/s/ Thomas S. Rooney, Jr.
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Thomas S. Rooney, Jr.
President and Chief Executive Officer

ACCEPTED AND AGREED:


/s/ Christian G. Farman
-------------------------------------
Christian G. Farman


Date December 2, 2003
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