Form 4: Energy Recovery Director Sells 50,000 Shares Under Pre-Arranged Trading Plan

Arve Hanstveit, a director at Energy Recovery, Inc., sold a total of 50,000 shares of common stock in two transactions in mid-June 2025, pursuant to a Rule 10b5-1 trading plan.

Summary

• Arve Hanstveit, a Director of Energy Recovery, Inc. (ERII), reported the sale of common stock.
• On June 11, 2025, Mr. Hanstveit sold 20,000 shares of common stock at a weighted average price of $12.75 per share, with individual trade prices ranging from $12.690 to $12.810.
• On June 12, 2025, an additional 30,000 shares of common stock were sold at a weighted average price of $12.68 per share, with individual trade prices ranging from $12.635 to $12.710.
• These transactions were conducted under a Rule 10b5-1(c) pre-arranged trading plan, indicating they were scheduled in advance.
• Following these sales, Mr. Hanstveit directly beneficially owns 655,220 shares of common stock.
• He also indirectly beneficially owns 60,000 shares through the Natasha Hanstveit Irrevocable Trust and 60,000 shares through the Sophie Hanstveit Irrevocable Trust, for which he is the sole trustee and exercises sole voting and investment power.

Sentiment

Score: 5

Explanation: The sentiment is neutral. While insider selling can be perceived negatively, the disclosure that the transactions were made pursuant to a Rule 10b5-1 plan mitigates concerns that the sales are based on new, adverse non-public information. It suggests a pre-planned liquidity event rather than a reactive divestment.

Positives

• The sales were conducted under a Rule 10b5-1(c) trading plan, which suggests the transactions were pre-scheduled and not based on immediate, non-public information.

Negatives

• A director selling a significant number of shares (50,000 shares) could be perceived negatively by investors, potentially signaling a lack of confidence or a need for liquidity, despite being pre-planned.

Risks

• Potential negative investor sentiment or market reaction due to insider selling, even if executed under a pre-planned trading arrangement.
• Increased supply of shares in the market from insider sales could exert downward pressure on the stock price.

Future Outlook

NA

Industry Context

This Form 4 filing is a routine regulatory disclosure of insider trading activity, specifically the sale of shares by a director. Such filings provide transparency into executive and director stock transactions, which can sometimes influence investor perception, though sales under a Rule 10b5-1 plan are generally viewed as less indicative of a change in sentiment compared to open market sales without such a plan.

Related Party Transactions

• Arve Hanstveit indirectly beneficially owns shares held in the Natasha Hanstveit Irrevocable Trust and Sophie Hanstveit Irrevocable Trust, for which he serves as the sole trustee and exercises sole voting and investment power.

Stakeholder Impact

• Shareholders: May interpret the director's sale of shares as a signal, potentially leading to negative sentiment or a slight downward pressure on the stock price, although the 10b5-1 plan mitigates this.

Key Dates

Keywords

Energy Recovery, ERII, Arve Hanstveit, Director, SEC Form 4, Insider Trading, Stock Sale, Rule 10b5-1, Common Stock