Exhibit 10.22

EMPLOYMENT AGREEMENT

This Employment Agreement (this “Agreement”) is entered into as of June 30,
2005, by and between Nautilus, Inc., a Washington corporation (the “Company” or
“Employer”), and Juergen Eckmann (“Employee”). In consideration of the premises
and the mutual covenants and agreements hereinafter set forth, the Company and
Employee hereby agree as follows:

1. Employment. Employee is being hired as Vice President and Chief of Staff,
Apparel Division. Employee shall (a) devote his professional entire time,
attention, and energies to his position, (b) use his best efforts to promote the
interests of Employer; (c) perform faithfully and efficiently his
responsibilities and duties, and (d) refrain from any endeavor outside of his
employment which interferes with his ability to perform his obligations
hereunder. Employee shall report to the President, Apparel Division, and/or such
other persons as may be designated by Employer, and perform his job duties
subject to his general supervision, orders, advice and direction. Employee shall
perform the duties normally associated with the position and/or such duties as
delegated and assigned by the Company. The Company retains the sole discretion
to change Employee’s position and/or duties as it deems appropriate.

Employee additionally agrees to abide by any general employment guidelines or
policies adopted by Employer such as those detailed in an employer’s handbook,
as such guidelines or policies may be implemented and/or amended from time to
time.

2. Salary. As compensation for services to be rendered hereunder, the Company
shall pay Employee an initial annual salary in the gross amount of US$195,000.
Said salary will be paid in accordance with the Company’s existing payroll
policies, and shall be subject to normal and/or authorized deductions and
withholdings. In addition, the Company will pay to Employee a one time bonus in
the amount of $30,000 payable on August 1, 2005, which bonus will vest in 1/12
increments over a 12 month period of time beginning August 1, 2005. Should
employee voluntarily resign from the Company prior to August 1, 2006 he will
re-pay a pro rata amount of that unvested bonus for any remaining time that he
is not employed prior to August 1, 2006.

3. Bonus. Employee will be eligible to receive an annual bonus up to the target
range of thirty percent (30%) of Employee’s base salary earned in 2005 while
employed by the Company and in each year thereafter. Employee will also be
eligible for a bonus of an additional 50% above the target range (i.e., a total
of 45% of salary earned in 2005) should the Company and individual reach certain
additional goals established by the President, Apparel Division and the Board of
Directors. The amount of such bonus (if any) is determined at the discretion of
the Company and based on the accomplishment of individual and Company
objectives. To be eligible to receive this bonus Employee must be employed on
the date the bonus is actually paid and no partial or pro-rata bonus will be
paid if Employee is not employed on the day the bonus is actually paid.

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4. Stock Options. Pursuant to the Company’s current 2005 Long Term Incentive
Plan (the “Plan”), the Company shall recommend that Employee receive options
(“Options”) to purchase 16,000 shares of Employer’s stock. The terms of any
option grant shall be governed by the Plan and a Stock Option Agreement (the
“Option Agreement”). Employee acknowledges that any stock options granted do
not, and will not, constitute wages or compensation. Unless otherwise provided
in the Plan or required by law, the Board of Directors of Employer shall have
sole discretion regarding the grant of options, price of options, the vesting
schedule and all other terms and conditions of the option grant.

5. Expenses. The Company will reimburse Employee for all necessary and
reasonable travel, entertainment and other business expenses incurred by him in
the performance of his duties hereunder, upon receipt of signed itemized lists
of such expenditures with appropriate back-up documentation, and/or in
accordance with such other reasonable procedures as the Company may adopt
generally from time to time.

6. Health and Welfare Benefits. Employee will remain on the current Dash America
benefit plans through December 31, 2005 on the same basis as he is currently
eligible and as those benefits are currently in place. Effective January 1,
2006, the Employee shall be eligible to receive employee benefits, if any,
generally provided to employees at the same level as Employee. Such benefits may
be amended or discontinued by Employer at any time and on the same basis as the
Employer does for employees at the same level as Employee.

7. Termination. The parties acknowledge that Employee’s employment with the
Company is “at-will” and may be terminated by either party with or without
cause. No one other than the President and Chief Executive Officer of the
Company or the Board of Directors has the power to change the at-will character
of the employment relationship, and any such changes must be in a written
document signed by the President and Chief Executive Officer. As discussed
below, however, the various possible ways in which Employee’s employment with
the Company may be terminated will determine the payments that may be due to
Employee under this Agreement. As used in this Agreement, the following terms
have the following meanings:

(a) Cause. As used in this Agreement, Cause means (i) Employee’s indictment or
conviction in a court of law for any crime or offense that in Employer’s
reasonable judgment makes Employee unfit for continued employment, prevents
Employee from performing Employee’s duties or other obligations or adversely
affects the reputation of Employer; (ii) dishonesty by Employee related to his
employment; (iii) violation of a key Employer policy or this Agreement by
Employee (including, but not limited to, acts of harassment or discrimination,
use of unlawful drugs or drunkenness on Employer’s premises during normal work
hours); (iv) insubordination (i.e. conduct such as refusal to follow direct
orders of the President or other individuals(s) to whom Employee reports;
(v) dereliction of duty by Employee (e.g., failure to perform minimum duties
after warning) and reasonable opportunity to correct; (vi) Employee’s
competition with Employer, diversion of any corporate opportunity, violation of
the Business Protection Agreement, or other similarly serious conflict of
interest or self-dealing incurring to Employee’s direct or indirect benefit and
Employer’s detriment; (vii) intentional or grossly negligent conduct by Employee
that is significantly injurious to Employer or its affiliates; (viii) Employee’s
failure to meet the minimum goals of his position if such are provided in

 

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writing to Employee, and as such goals may be amended from time to time; and
(ix) Employee’s death or disability (i.e., Employee’s inability to perform the
essential job functions of the position with or without a reasonable
accommodation).

(b) At-Will. At-will termination shall mean a termination by the Company where
it does not seek to establish Cause. If the Company exercises its right to
terminate Employee without Cause, it shall provide the Employee with 183 days
prior written notice of the termination of his employment (Notice of
Termination), provided however, that at the Company’s sole discretion, it may
immediately relieve Employee from all duties and responsibilities during the
Notice Period. After receiving Notice of Termination, the Employee must continue
to perform all duties and responsibilities, unless such duties are removed. If
the Company exercises its option to relieve Employee of duties after the Company
has provided Notice of Termination, then the Company shall continue to provide
Employee with the basic benefits generally applicable to the Company’s employees
and base salary during the Notice Period. If Employee exercises his right to
terminate his employment, the Employee agrees to provide the Company with 21
days’ prior written notice of the termination of his employment (Notice of
Termination). After receiving such Notice from the Employee, the Company retains
the right to accept Employee’s resignation, and hence, terminate the employment
relationship without the need for further payments, at an earlier date than
provided in the Employee’s Notice of Termination.

8. Severance Upon Termination.

(a) Upon termination of Employee’s employment under this Agreement by the
Company without Cause, then, in lieu of any further salary, bonus, or other
payments for periods subsequent to the Date of Termination, the Company shall
pay to the Employee severance equal to six months average monthly annual base
salary1. Such severance payment shall be made according to the Company’s normal
payroll process spread out equally over the severance period. Violation of this
Agreement or the Business Protection Agreement and/or failure to sign the
Release and Waiver Agreement shall immediately relieve the Company from its
payment obligation under this paragraph and entitle it to recover any amounts
paid under this paragraph. This Section 8 shall be read in conjunction with
Section 7(b), and entitles the employee to a maximum of six months salary,
benefits, or notice under this Agreement.

(b) If the Company terminates the Employee’s employment during the term of this
Agreement for Cause or if the Employee terminates his employment , then the
Company shall have no further payment obligations to Employee.

(c) Except as it relates to the receipt of severance (which shall be solely
granted under the terms of this Agreement), this Agreement shall not affect any
payments due to Employee under applicable law as a result of the termination of
his employment (such as payment of earned wages).

 

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1 The average annual monthly base salary shall be calculated using the average
of the cash compensation received by Employee in the six months prior to the
Date of Termination.

 

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(d) In the event that Employee is discharged without cause as defined herein,
Company shall provide the following relocation benefits to Employee: packaging
and shipment of household goods from Colorado to Germany, and airfare for
Employee and his family from Colorado to Germany.

9. Return of Documents. Employee understands and agrees that all equipment,
records, files, manuals, forms, materials, supplies, computer programs, and
other materials furnished to the Employee by Employer or used on Employer’s
behalf, or generated or obtained during the course of his/her employment shall
remain the property of Employer. Upon termination of this Agreement or at any
other time upon the Company’s request, Employee agrees to return all documents
and property belonging to the Company in his possession including, but not
limited to, customer lists, contracts, agreements, licenses, business plans,
equipment, software, software programs, products, work-in-progress, source code,
object code, computer disks, Confidential Information, books, notes and all
copies thereof, whether in written, electronic or other form. In addition,
Employee shall certify to the Company in writing as of the effective date of
termination that none of the assets or business records belonging to the Company
is in his/her possession, remain under his control, or have been transferred to
any third person.

10. Confidential Information/Non-Competition. By virtue of his employment,
Employee will have access to confidential, proprietary and trade secret
information, the ownership and protection of which is very important to the
Company. Employee hereby agrees to enter into a Business Protection Agreement
with the Company concurrent with his entry into this Agreement. The Business
Protection Agreement is attached as Exhibit A hereto.

11. Release of Claims. As a precondition to receipt of the severance provided in
Section 7(b) or 8(a) of this Agreement, Employee acknowledges and understands
that he must sign a standard Waiver and Release of Claims Agreement in a form
acceptable to the Company and generally then in use for employees who are
terminated. Employee understands that he will not be entitled to receive any
payments under this Agreement until he executes and delivers the Waiver and
Release of Claims Agreement, and the revocation period set forth in the Waiver
and Release of Claims Agreement has run.

12. Assignment. This Agreement is personal, and is being entered into based upon
the singular skill, qualifications and experience of Employee. Employee shall
not assign this Agreement or any rights hereunder without the express written
consent of Employer which may be withheld with or without reason. This Agreement
will bind and benefit any successor of the Employer, whether by merger, sale of
assets, reorganization or other form of business acquisition, disposition or
business reorganization.

13. Notices. Any Notice of Termination shall be in writing and shall be deemed
to have been given or submitted (i) upon actual receipt if delivered in person
or by facsimile transmission with confirmation of transmission, (ii) upon the
earlier of actual receipt or the expiration of two (2) business days after
sending by express courier (such as U.P.S. or Federal Express), and (iii) upon
the earlier of actual receipt or the expiration of seven (7) business days after
mailing if sent by registered or certified mail, postage prepaid, to the parties
at the following addresses:

 

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To the Company:  

Nautilus, Inc.

16400 SE Nautilus Drive

Vancouver, WA 98684

Attention: Human Resources

With a Copy to:  

Garvey, Schubert & Barer

1191 Second Avenue, 18th Floor

Seattle, WA 98101-2939

Attention: Bruce Robertson

To Employee:  

Employee: Juergen Eckmann

 

At the last address and fax number Shown on the records of the Company

Employee shall be responsible for providing the Company with a current address.
Either party may change its address (and facsimile number) for purposes of
notices under this Agreement by providing notice to the other party in the
manner set forth above within ten business days.

14. Effect of Waiver. The waiver by either party of a breach of any provision of
this Agreement shall not operate or be construed as a waiver of any subsequent
breach hereof. No waiver shall be valid unless in writing.

15. Entire Agreement. This Agreement, along with the Business Protection
Agreement attached as Exhibit A, sets forth the entire agreement of the parties
hereto and supersedes any and all prior agreements and understandings concerning
Employee’s employment by the Company. This Agreement shall replace the
Employment Agreement dated August 1, 2004 between Employee and DashAmerica,
Inc., which Employment Agreement shall have no further force and effect. This
Agreement may be changed only by a written document signed by Employee and the
Company.

16. Governing Law/Jurisdiction/Venue. This Agreement shall be governed by, and
construed and enforced in accordance with, the substantive and procedural laws
of the State of Washington without regard to rules governing conflicts of law.
For all disputes under this Agreement, the parties agree that any suit or action
between them shall be instituted and commenced exclusively in the state courts
in Clark County or King County Washington (U.S.A) or the United States District
Court for the Western District of Washington, sitting in Seattle, Washington.
Both parties waive the right to change such venue and hereby consent to the
jurisdiction of such courts for all potential claims under this Agreement.

17. Acknowledgment. The Employee acknowledges that he has read and understands
this Agreement, that he has consulted with an attorney regarding the terms and
conditions hereof, and that he accepts and signs this Agreement as his own free
act and in full and complete understanding of its present and future legal
effect.

 

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18. Vacation Benefit. Employee will be granted 4 weeks vacation upon assuming
employment and will be able to carryover from one year to another a maximum of 2
weeks of unused vacation, which will allow Employee to accrue a maximum of 6
weeks vacation. Any accrued but unused vacation will be paid at time of
termination.

19. Miscellaneous Benefits. Company will provide appropriate legal advice and
support to enable Employee’s spouse to be legally employed pursuant to US laws,
and will provide professional job search and outplacement assistance in
connection with a job search in the Denver/Boulder Colorado area.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above.

 

Employer: NAUTILUS, INC.    

 

   

 

By  

 

    Date Its  

 

   

 

   

 

Employee     Date

 

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