Rodney Clemente
Energy RecoveryAbout Rodney Clemente
Rodney Clemente, age 45, is Senior Vice President, Water at Energy Recovery (ERII). He joined the company in 1998 and has led global desalination operations and the Water business unit; he holds a B.S. in Engineering (Cal State East Bay) and an Executive MBA from UVA Darden . Company 2024 performance under his tenure in the Water unit included record revenue of $144.9M (+13% YoY), gross margin 66.9%, operating cash flow $20.5M, and 1- and 3-year TSR of -28% and +8% respectively .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Energy Recovery | Senior Vice President, Water | Dec 22, 2019 – present | Leads all sales, technical service, support and aftermarket for Water; system design, technical consultation and commercial support worldwide |
| Energy Recovery | Vice President, Water | Jul 31, 2018 – Dec 22, 2019 | Advanced commercial growth in water segment |
| Energy Recovery | VP, Global Desalination Operations | Apr 29, 2015 – Jul 31, 2018 | Scaled global operations for desalination customers |
| Energy Recovery | Various roles since joining | 1998 – Apr 29, 2015 | Built expertise across manufacturing, marketing, business development; energy recovery technologies |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| International Desalination Association (IDA) | Member | Not disclosed | Active member; industry engagement |
| American Membrane Technology Association (AMTA) | Member | Not disclosed | Active member; industry engagement |
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Salary ($) | $336,430 | $352,608 | $372,739 |
| Target Bonus % | 60% | Not disclosed | 70% |
| Actual Bonus Paid ($) | $221,248 (paid 2023) | $192,173 (paid 2024) | $201,886 (paid 2025) |
| Base Salary (annualized at year-end) ($) | Not disclosed | Not disclosed | $390,000; +9% YoY |
Performance Compensation
2024 Annual Incentive Plan (AIP) – Metrics and Outcomes
| Metric | Weighting (%) | Target | Actual Achievement (%) | Payout Impact | Vesting/Timing |
|---|---|---|---|---|---|
| Revenue | 35 | Company-set annual target | 74 | Contributed to 77% total attainment | Cash bonus, paid 2025 |
| Adjusted Operating Income | 35 | Company-set annual target | 104 | Contributed to 77% total attainment | Cash bonus, paid 2025 |
| Wastewater Revenue (Unique Objective) | 30 | Segment goal | 50 | Contributed to 77% total attainment | Cash bonus, paid 2025 |
| Overall AIP Achievement | 100 | — | 77 | AIP paid: $201,886 | Paid in 2025 |
Equity Grants
| Grant Type | Grant Date | Shares (#) | Fair Value ($) | Vesting Terms |
|---|---|---|---|---|
| RSUs | Jan 25, 2024 | 69,925 | $1,129,988 | 25% on each of first 4 anniversaries |
| Options | Feb 1, 2021 | 12,535 | $174,989 | 25% at 1-year; remainder monthly (48 months) |
| RSUs | Feb 1, 2021 | 33,519 | $175,138 | 25% annually (4 years) |
| Options | Jan 28, 2022 | 23,674 | $174,998 | 25% at 1-year; remainder monthly (48 months) |
| RSUs | Jan 28, 2022 | 9,215 | $174,993 | 25% annually (4 years) |
| RSUs | Mar 7, 2022 | 7,911 | $149,993 | 33⅓% annually (3 years) |
| RSUs (additional) | Oct 24, 2023 | 21,762 | $409,996 | 33⅓% annually (3 years) |
| RSUs (annual 2023) | 2023 (date not stated) | Not disclosed | $881,300 | Not disclosed |
Notes:
- ERII ceased annual option grants to most NEOs in 2024 and emphasized RSUs; performance-based RSUs were introduced for 2025 annual grants .
- RSU vesting standards: 25% over four years or 33⅓% over three years per plan footnotes .
Equity Ownership & Alignment
| Metric | Value |
|---|---|
| Beneficial Ownership (Apr 7, 2025) | 85,279 shares total; 19,300 directly/indirectly owned; 65,979 exercisable/vested within 60 days; ~0.2% of shares outstanding |
| Unvested RSUs (Dec 31, 2024) | 101,848 shares; market value $1,497,167 (at $14.70) |
| Options Outstanding (Dec 31, 2024) | 61,911 exercisable; 9,000 unexercisable |
| Ownership Guidelines | Execs must hold equity equal to 2x base salary; covered executives are in compliance or on pace |
| Hedging/Pledging | Prohibited by Insider Trading Policy; no pledges disclosed |
Insider Transactions and Selling Pressure
- Feb 20, 2025: Sold 21,444 shares at ~$15.42; Jul 25, 2025: 2,320 shares withheld for taxes upon vesting; Jul 28, 2025: Sold 5,387 shares at ~$13.97; the July transactions were under a Rule 10b5-1 plan adopted Dec 10, 2024 .
- Feb 20, 2025 sale and Mar 11, 2025 sale of 1,843 shares reported; also a smaller sale on Jul 29, 2024 of 2,353 shares at ~$14.63 .
Interpretation:
- Sales were pre-programmed (10b5-1) and include tax-withholding entries, reducing discretionary selling pressure risk; cadence aligns with RSU vesting schedules .
Employment Terms
| Provision | Severance Plan (Non-CIC) | Change-in-Control (Double Trigger) |
|---|---|---|
| Cash | 6 months base salary: $195,000 | 12 months base salary + 100% target bonus: $663,000 |
| Equity | Immediate vesting of 25% of all unvested equity awards ($374,679 at $14.70) | Immediate vesting of 100% of unvested equity awards ($1,498,717 at $14.70) |
| COBRA | Up to 6 months (est. $16,153) | Up to 12 months (est. $32,306) |
| Outplacement | Not specified | Up to $10,000 |
| Triggers | Qualifying termination without Cause; excludes non-qualifying reasons | CIC plus qualifying termination within 18 months (“double trigger”) |
| Clawback | Dodd-Frank compliant clawback policy amended July 2023 | N/A (policy applies broadly) |
Notes:
- CIC Plan auto-extends annually unless terminated; no tax gross-up; “better after-tax” reduction may apply .
- CIC equity vesting at target for performance awards; accelerated if awards not assumed by acquirer .
Compensation Structure Analysis
- Mix shift: ERII stopped broad-based stock option grants in 2024 for NEOs, awarding RSUs; performance RSUs introduced in 2025, increasing pay-for-performance alignment while maintaining retention through time-based RSUs .
- At-risk pay: Substantial portion of NEO pay is variable; rigorous ownership guidelines; stringent clawback; no repricing or gross-ups .
- AIP calibration: 2024 achievement driven by outperformance on adjusted operating income and partial achievement on revenue and wastewater objectives; payout at 77% reflects measured application without upward discretion .
Investment Implications
- Alignment: Significant unvested RSUs ($1.50M) and ownership requirements support retention and long-term alignment; hedging/pledging prohibited reduces governance risk .
- Selling pressure: Recent sales largely under 10b5-1 and tax withholding, moderating discretionary sell risk; monitor cadence around vest dates and plan updates .
- Incentive drivers: 2024 incentives tied to revenue, adjusted operating income, and wastewater growth; future performance RSUs increase sensitivity to execution in Water and diversification initiatives .
- Downside/upsides: Severance provides moderate cushion (6 months) while CIC terms (12 months + target bonus + full acceleration) are standard; no gross-ups; governance practices (ownership, clawback, say-on-pay approval at 89.3%) reduce compensation risk .