Exhibit 10.22
EXHIBIT 10.22
PRESIDENT and CHIEF EXECUTIVE OFFICER
EMPLOYMENT CONTRACT
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This agreement, made and effective as of the 1st day of May, 2005, is by and
between Enova Systems, Inc., a California corporation (hereinafter "Enova"), and
Edwin O. Riddell, an individual (hereinafter "Riddell"). This Agreement provides
for a continuous employment, unless otherwise noted herein.
WHEREAS, the Enova desires to secure the services of Riddell as president and
CEO of Enova, and Riddell desires to accept such employment.
NOW THEREFORE, in consideration of the material advantages accruing to the two
parties and the mutual covenants contained herein, and intending to be legally
and ethically bound hereby, Enova and Riddell agree with each other as follows:
1. Riddell will render full-time professional services to Enova in the capacity
of President and Chief Executive Officer of the Enova Systems, Inc. Riddell will
at all times, faithfully, industriously and to the best of his ability, perform
all duties that may be required of him by virtue of his position as President
and Chief Executive Officer and all duties set forth in Enova's bylaws and in
policy statements of the Board. It is understood that these duties shall be
substantially the same as those of a president and chief executive officer of
other business corporations. The President and CEO is hereby vested with
authority to act on behalf of the Board in keeping with policies adopted by the
Board, as amended from time to time. In addition, Riddell shall perform in the
same manner any special duties assigned or delegated to him by the Board.
2. Continued employment will be contingent upon Riddell signing a copy of this
contract, an Arbitration Agreement, and his ability to provide legally required
documentation of his eligibility to work within the United States, as required
by the Immigration Reform and Control Act.
3. In addition, as an employee of Enova, Riddell will have access to certain
Enova confidential information and may, during the course of his employment,
develop certain information or trade secrets which will be the property of
Enova. To protect the interests of the company, Riddell will sign a
"Confidential Information Agreement" if so requested at any time by Enova. Enova
wishes to impress upon Riddell that it does not want him to bring any
confidential or proprietary material of any former employers prior to Enova
Systems, or to violate any other obligation to his former employers.
4. In consideration for these services as Chief Executive Officer, Enova
Systems, Inc. agrees to pay Riddell a salary of $208,000 per annum or such
higher figure as shall be agreed upon at an annual review of his compensation
and performance by the Board payable in bi-weekly installments throughout the
contract year. This annual review shall occur three months prior to the end of
each year of the contract for the express purpose of considering increments.
5. Riddell will receive 1,000,000 options to purchase common stock in Enova
Systems, Inc. at the exercise price of $0.11 per share. The options will vest
over three years in equal monthly installments with expiration at five years
from the date of issuance.
6. Riddell will be eligible for bonus consideration established by Enova's
Compensation Committee annually. Objectives for such consideration shall be set
forth no later than November of each year.
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7. Benefits:
a. Riddell shall be entitled to all other fringe benefits to which all
executives and employees of the Enova are entitled.
b. Riddell will become eligible on the first of the month following the
date of hire for Medical, Dental, Vision and the standard term benefit
life insurance policy with his choice of beneficiary. In lieu of
medical benefits, Enova agrees to pay the monthly employee-portion of
Riddell's current medical insurance not to exceed $700.00 per month
unless otherwise mutually agreed by both parties.
c. In the event of a single period of prolonged inability to work due to
the result of a sickness or an injury, Riddell will be compensated at
his full rate pay for at least 6 (six) months from the date of the
sickness or injury.
8. Enova Systems also agrees to:
a. furnish, for the use of Riddell, an automobile, leased or purchased,
and reimburse him for expenses of its operation.
b. furnish, for the use of Riddell, a furnished, leased apartment, not to
exceed $2,000 per month, for the term of this Contract, and reimburse
him for expenses associated with the maintenance of such limited to
utilities and maintenance.
9. The Board may at its discretion terminate Riddell's duties as Chief Executive
Officer. Such action shall require a majority of vote of the entire Board and
become effective upon written notice to Riddell or at such later time as may be
specified in said notice. After such termination, all rights, duties and
obligations of both parties shall cease except that Enova Systems, Inc. shall
continue to pay Riddell his then monthly salary for the month in which his
duties were terminated and for 12 consecutive months thereafter as an agreed
upon severance payment. During this period, Riddell shall not be required to
perform any duties for Enova Systems, Inc. or come to Enova's offices. Neither
shall the fact that Riddell seeks, accepts and undertakes other employment
during this period affect such payments. Also, for the period during which such
payments are being made, Enova agrees to keep Riddell's group life, health and
major medical insurance coverage paid up and in effect. The severance
arrangements described in this paragraph will not be payable in the event that
Riddell's employment is terminated for cause. Cause may include but not be
limited to; fraud, other illegal acts either internal or external to Enova's
business; material violations of Enova policy; unethical acts; substantiated,
unlawful discriminatory conduct including sexual/racial harassment.
10. Should the Board in its discretion change Riddell's duties or authority so
it can reasonably be found that Riddell is no longer performing as the Chief
Executive Officer of Enova, Riddell shall have the right, within 90 days of such
event, in his complete discretion, to terminate this contract by written notice
delivered to the Chairman of the Board. Upon such termination, Riddell shall be
entitled to the severance payment described in Paragraph 9, in accordance with
the same terms of that paragraph.
11. If Enova Systems, Inc. is merged, sold or closed; Riddell may terminate his
employment at his discretion or be retained as President of Enova or any
successor corporation to or holding company of Enova Systems, Inc. If Riddell
elects to terminate his employment at such time, he shall be entitled to the
same severance arrangement as would be applicable under Paragraph 9 if Enova
Systems, Inc. had terminated his employment at such time.
Any election to terminate employment under this Paragraph must be made
prior to Enova Systems, Inc. merger, sale or closure, as applicable.
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If Riddell continues to be employed by Enova or its successor
organization, all of the terms and conditions of this Agreement shall remain in
effect. Enova agrees that neither it nor its present or any future holding
company shall enter into any agreement that would negate or contradict the
provisions of this Agreement.
12. Should Riddell at his discretion elect to terminate this contract for any
other reason than as stated in Paragraph 9, he shall give the Board 120 days'
written notice of his decision to terminate. At the end of the 120 days, all
rights, duties and obligations of both parties to the contract shall cease and
Riddell will not be entitled to severance benefits.
13. If an event described in Paragraph 9, 10, or 11 occurs and Riddell accepts
any of the severance benefits or payments described therein, to the extent not
prohibited by law, Riddell shall be deemed to voluntary release and forever
discharge Enova and its officers, directors, employees, agents, and related
corporations and their successors and assigns, both individually and
collectively and in their official capacities (hereinafter referred to
collectively as "Releasees"), from any and all liability arising out of his
employment and/or the cessation of said employment. Nothing contained in this
paragraph shall prevent Riddell from bringing an action to enforce the terms of
this Agreement.
14. Riddell shall maintain confidentiality with respect to information that he
receives in the course of his employment and not disclose any such information.
Riddell shall not, either during the term of employment of thereafter, use or
permit the use of any information of or relating to Enova in connection with any
activity or business and shall not divulge such information to any person, firm,
or corporation whatsoever, except as may be necessary in the performance of his
duties hereunder or as may be required by law or legal process.
15. During the term of his employment and during the 12-month period following
termination of his employment, Riddell shall not directly own, manage, operate,
join, control, or participate in or be connected with, as an officer, employee,
partner, stockholder or otherwise, any competitive company or related business,
partnership, firm, or corporation (all of which hereinafter are referred to as
"entity") that is at the time engaged principally or significantly in a business
that is, directly or indirectly, at the time in competition with the business of
Enova Systems. Nothing herein shall prohibit Riddell from acquiring or holding
any issue of stock or securities of any entity that has any securities listed on
a national securities exchange or quoted in a daily listing of over-the-counter
market securities, provided that any one time Riddell and members of Riddell's
immediate family do not own more than one percent of any voting securities of
any such entity. This covenant shall be construed as an agreement independent of
any other provision of this Agreement, and the existence of any claim or cause
of action, whether predicted on this Agreement or otherwise, shall not
constitute a defense to the enforcement by Enova of this covenant. In the event
of actual or threatened breach by Riddell of this provision, Enova shall be
entitled to an injunction restraining Riddell from violation or further
violation of the terms thereof.
16. Riddell shall not directly or indirectly through his own efforts, or
otherwise, during the term of this Agreement, and for a period of 12 months
thereafter, employ, solicit to employ, or otherwise contract with, or in any way
retain the services of any employee or former employee of the Enova, if such
individual has provided professional or support services to Enova at any time
during this Agreement without the express written consent of Enova. Riddell will
not interfere with the relationship of Enova and any of its employees and
Riddell will not attempt to divert from Enova any business in which Enova has
been actively engaged during his employment.
17. This contract constitutes the entire agreement between the parties and
contains all the agreements between them with respect to the subject matter
hereof. It also supersedes any and all other agreements or contracts, either
oral or written, between the parties with respect to the subject matter hereof.
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18. Except as otherwise specifically provided, the terms and conditions of this
contract may be amended at any time by mutual agreement of the parties, provided
that before any amendment shall be valid or effective it shall have been reduced
to writing and signed by the Chairman of the Board and Riddell.
19. The invalidity or unenforceability of any particular provision of this
contract shall not affect its other provisions, and this contract shall be
construed in all respects as if such invalid or unenforceable provisions had
been omitted.
20. This agreement shall be binding upon Enova Systems, Inc., its successors and
assigns, including, without limitation, any corporation into which Enova may be
merged or by which it may be acquired, and shall inure to the benefit of
Riddell, his administrators, executors, legatees, heirs and assigns.
21. This agreement shall be construed and enforced under and in accordance with
the laws of the State of California.
Enova Systems, Inc.
By:________________________________________________________
Anthony Rawlinson, Chairman of the Board
By:________________________________________________________
Bjorn Ahlstrom, Chairman - Compensation Committee
Accepted by:___________________________
Edwin O. Riddell
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