Exhibit 10.1
EMPLOYMENT AGREEMENT
     This EMPLOYMENT AGREEMENT (the “ Agreement”), is made as of May 1, 2010
(the “ Effective Date”) by and between Anthera Pharmaceuticals, Inc. (the “
Company”) and James Pennington (the “ Executive”).
     WHEREAS, the Company and the Executive entered into that certain letter re:
Severance Benefits Agreement, dated as of July 19, 2007 (the “ Original
Agreement”);
     WHEREAS, the Company and the Executive subsequently entered into that
certain Amended and Restated Severance Benefits Agreement as of October 15, 2009
(the “Amended Agreement”), which replaced the Original Agreement; and
     WHEREAS, the Company and the Executive desire to replace, in their
entirety, the Original Agreement and the Amended Agreement, effective as of the
Effective Date and in accordance with the terms hereof;
     NOW, THEREFORE, in consideration of the mutual covenants and promises
hereinafter set forth and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company and the Executive
agree as follows:
     1. Termination of Prior Agreements; Term.
          (a) As of the Effective Date, the Original Agreement and the Amended
Agreement shall terminate and be of no further force and effect.
          (b) The term of this Agreement shall extend from the Effective Date
until the first anniversary of the Effective Date. This Agreement may be
extended for an additional term in an agreement executed in writing by the
parties prior to this Agreement’s expiration date. The term of this Agreement
shall be subject to termination as provided in Section 3 and may be referred to
herein as the “Term.”
     2. Employment, Compensation and Related Matters.
          (a) Commencing on the Effective Date, Executive shall serve as Senior
Clinical Fellow on behalf of the Company, and shall have such duties as may from
time to time be prescribed by the Company. The Executive shall devote his full
working time and efforts to the business and affairs of the Company.
          (b) During the term of this Agreement, the Executive’s salary shall be
$24,166.67 per month, less customary withholdings. The salary shall be payable
in a manner that is consistent with the Company’s usual payroll practices for
senior executives.

 

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          (c) The Executive shall be entitled to receive prompt reimbursement
for all reasonable expenses incurred by him in performing services hereunder, in
accordance with the policies and procedures then in effect and established by
the Company.
          (d) The Executive shall also be entitled to employee benefits,
including health insurance, vacation and paid holidays, in accordance with the
policies and procedures then in effect and established by the Company.
          (e) As of the Effective Date, the unvested portions of all Option
Grants shall be modified in that it they shall vest (and the repurchase option
with respect to any early exercised Option Grants shall lapse) over twelve
months from the Effective Date in equal monthly installments on the first day of
each of such twelve months such that on the one year anniversary of the
Effective Date all Option Grants shall be fully vested (and the repurchase
option with respect to any early exercised Option Grants shall be fully lapsed),
so long as this Agreement remains in effect and the Executive maintains a
service relationship with the Company on each such date. The provisions of the
Option Grants which are not amended hereby shall remain in effect unchanged. For
purposes of this Agreement, the term “ Option Grants” shall mean the following
grants of stock options to purchase common stock of the Company, par value $.001
per share (“ Common Stock”), which are subject to time-based vesting as set
forth in the applicable option agreements:

  (i)   Grant dated March 9, 2007 with respect to 105,140 shares;     (ii)  
Grant dated October 24, 2007 with respect to 37,967 shares; and     (iii)  
Grant dated February 18, 2009 with respect to 29,205 shares.

     3. Termination.
          (a) If, prior to the end of the Term, the Executive’s employment with
the Company is terminated by the Company for any reason other than for Cause or
by the Executive due to a Constructive Termination, and if the Executive
provides the Company with a signed general release of all claims against the
Company and its affiliates in a form reasonably acceptable to the Company (the “
Release”) within the 21-day period following the date of termination of
employment and the seven-day revocation period for the Release has expired, then
the Company shall pay, through the end of the Term (1) the Executive’s salary,
on the Company’s regular payroll dates, and (2) the COBRA premium for health
benefits covering the Executive and his eligible dependents, to the same extent
as if the Executive had remained employed through the end of the Term, provided
the Executive makes a timely COBRA election and the Executive and his dependents
are and remain eligible for such benefits under COBRA. In addition, with regard
to the Executive’s outstanding options, all unvested shares to purchase the
Company’s common stock shall become vested and any vesting restrictions on any
Company restricted stock awards that the Executive holds as of the date of such
termination of employment shall lapse (the acceleration of vesting of stock
options and restricted stock described in this section shall be effective as of
the date of the Executive’s termination of employment).
          (b) For purposes of this Agreement, “ Cause” shall mean (i) gross
negligence or willful misconduct by the Executive in the performance of the
Executive’s duties to the

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Company that is not cured within thirty (30) days of written notice thereof,
where such gross negligence or willful misconduct has resulted or is likely to
result in substantial and material damage to the Company or its subsidiaries;
(ii) the Executive’s repeated unexplained or unjustified absence from the
Company; (iii) a material and willful violation by the Executive of any federal
or state law; (iv) commission by the Executive of any act of fraud with respect
to the Company; or (v) the Executive’s commission of an act of moral turpitude
or conviction of or entry of a plea of nolo contendere to a felony.
          (c) For purposes of this Agreement, “ Constructive Termination” shall
mean the Executive’s resignation within 180 days of the occurrence of any one or
more of the following events without the Executive’s prior written consent,
provided that the Executive has provided written notice to the Company within
ninety (90) days of the first occurrence of the event and such event remains
uncured by the Company thirty (30) days after the Executive’s delivery to the
Company of written notice thereof:
          (i) a material diminution of the Executive’s base compensation (other
than in connection with a general decrease in base salaries for most similarly
situated employees of the Company or a successor corporation); or
          (ii) a material change in the geographic location at which the
Executive provides services to the Company.
     4. Section 409A.
          (a) Anything in this Agreement to the contrary notwithstanding, if at
the time of the Executive’s separation from service within the meaning of
Section 409A of the Code, the Company determines that the Executive is a
“specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code,
then to the extent any payment or benefit that the Executive becomes entitled to
under this Agreement on account of the Executive’s separation from service would
be considered deferred compensation subject to the 20 percent additional tax
imposed pursuant to Section 409A(a) of the Code as a result of the application
of Section 409A(a)(2)(B)(i) of the Code, such payment shall not be payable and
such benefit shall not be provided until the date that is the earlier of (A) six
months and one day after the Executive’s separation from service, or (B) the
Executive’s death. If any such delayed cash payment is otherwise payable on an
installment basis, the first payment shall include a catch-up payment covering
amounts that would otherwise have been paid during the six-month period but for
the application of this provision, and the balance of the installments shall be
payable in accordance with their original schedule.
          (b) To the extent that any payment or benefit described in this
Agreement constitutes “non-qualified deferred compensation” under Section 409A
of the Code, and to the extent that such payment or benefit is payable upon the
Executive’s termination of employment, then such payments or benefits shall be
payable only upon the Executive’s “separation from service.” The determination
of whether and when a separation from service has occurred shall be made in
accordance with the presumptions set forth in Treasury
Regulation Section 1.409A-1(h).

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          (c) The parties intend that this Agreement will be administered in
accordance with Section 409A of the Code. To the extent that any provision of
this Agreement is ambiguous as to its compliance with Section 409A of the Code,
the provision shall be read in such a manner so that all payments hereunder
comply with Section 409A of the Code. The parties agree that this Agreement may
be amended, as reasonably requested by either party, and as may be necessary to
fully comply with Section 409A of the Code and all related rules and regulations
in order to preserve the payments and benefits provided hereunder without
additional cost to either party.
     5. Binding Agreement. This Agreement shall inure to the benefit of and be
enforceable by the Executive and the Executive’s personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If the Executive should die while any amount would still
be payable to the Executive hereunder had the Executive continued to live, all
such amounts, unless otherwise provided herein, shall be paid in accordance with
the terms of this Agreement to the Executive’s devisee, legatee or other
designee or, if there is no such designee, to the Executive’s estate.
     6. Entire Agreement. This Agreement sets forth the entire agreement of the
parties hereto in respect of the subject matter contained herein and supersedes
all prior agreements, arrangements and understandings of the parties hereto with
respect to the subject matter contained herein, including, without limitation,
any prior change in control agreements.
     7. At-Will Employment. Nothing contained in this Agreement shall (a) confer
upon the Executive any right to continue in the employ of the Company,
(b) constitute any contract or agreement of employment, or (c) interfere in any
way with the at-will nature of the Executive’s employment with the Company.
     8. Miscellaneous. No provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in writing
and signed by the Executive and such officer as may be specifically designated
by the Board. No waiver by either party hereto at any time of any breach by the
other party hereto of or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. The validity, interpretation, construction and performance of
this Agreement shall be governed by the laws of the State of California without
regard to its conflicts of law principles. The section headings contained in
this Agreement are for convenience only, and shall not affect the interpretation
of this Agreement. This Agreement may be executed in several counterparts, each
of which shall be deemed to be an original but all of which together shall
constitute one and the same instrument. The invalidity or unenforceability of
any provision of this Agreement shall not affect the validity or enforceability
of any other provision of this Agreement, which shall remain in full force and
effect.
     9. Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the Executive and the Executive’s heirs, executors, personal
representatives, assigns, administrators and legal representatives. Because of
the unique and personal nature of the Executive’s duties under this Agreement,
neither this Agreement nor any rights or obligations under this Agreement shall
be assignable by the Executive. This Agreement shall be binding

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upon and inure to the benefit of the Company and its successors, assigns and
legal representatives. As a condition precedent to the consummation of any
merger, sale of all or substantially all of the assets of the Company or other
similar transaction the Company shall obtain the consent of the acquirer or
successor entity to its assumption of the rights and obligations of the Company
under this Agreement.
     IN WITNESS WHEREOF, this Agreement has been executed by a duly authorized
representative of the Company and by the Executive, as of the Effective Date.

            Anthera Pharmaceuticals Inc.
      By:   /s/ Paul Truex         Name:   Paul Truex        Title:   President
and Chief Executive Officer        Executive
      /s/ James Pennington       James Pennington           

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