Exhibit 10.1

EMPLOYMENT AGREEMENT

This Employment Agreement (this “Agreement”) is entered into as of the Effective
Date set forth on
Schedule A hereto, by and between athenahealth, Inc. (“Athena”) and the
undersigned Employee (“Employee”).

The parties agree as follows:

1. Employment; Term

a. Athena hereby employs Employee, and Employee accepts employment with Athena,
upon the terms and conditions contained in this Agreement.

b. Employee’s employment is at-will and for no definite period of time; either
Employee or Athena may terminate Employee’s employment at any time with or
without reason and with or without advance notice. Upon termination of
employment, Employee will only be entitled to receive any accrued but unpaid
portion of Employee’s base salary through the date of termination, any accrued
but unused paid time off, outstanding expenses reimbursable under Athena’s
then-applicable policies, and any other benefits that may be owing through the
date of termination. Upon and following termination, Athena will have no
liability or obligation to Employee other than as specifically set forth in this
Section 1(b) or as provided by law.

c. Upon Athena’s request or the termination of Employee’s employment, Employee
will immediately return to Athena all (i) documents, materials, records, files,
notes, designs, drawings, notebooks, data, databases, and other information, in
any media, related to Athena’s business, including all copies; (ii) Athena
property (whether owned or leased) in Employee’s possession or control
(including, but not limited to, badges, computer hardware, data storage devices,
manuals, programs, printers, faxes, telephones, calling or credit cards,
supplies, tools, and vehicles); and (iii) documents and other media containing
any Confidential Information (as defined in Section 5). At such time, Employee
shall also destroy any Confidential Information in Employee’s possession or
control that cannot be returned to Athena (e.g., information that is in an
electronic or magnetic format and not on equipment or media owned by Athena).

d. Sections 5 through 11 will remain in effect following termination of
Employee’s employment with Athena.

2. Duties

a. During the period that Employee is employed by Athena (the “Employment
Period”), Employee will: (i) serve in the position set forth in Schedule A or in
any other position that Athena may from time to time assign to Employee; (ii) be
evaluated 6 months from the Effective Date of this Agreement as set forth in
Schedule A; (iii) perform all duties associated with each such position, as well
as such other duties as Athena may from time to time assign to Employee, in each
case in a timely and professional manner and in accordance with Athena’s
reasonable instructions; (iv) devote substantially all of his or her business
time and effort to the performance of such duties; and (v) comply with Athena’s
policies and procedures as in effect from time to time (including, but not
limited to, those relating to conduct or legal compliance).

b. Employee warrants to Athena that, except as disclosed on Schedule A hereto,
Employee is not party to any agreement or understanding that would limit the
ability of Employee to work in any capacity or position at Athena (e.g., any
non-compete, non-disclosure, or similar agreement).

3. Compensation

a. Employee’s compensation will be as set forth in the attached Schedule A.

b. Any grant of shares, or right to acquire shares, of Athena’s stock set forth
in Schedule A is a promise only to recommend such grant to Athena’s Board of
Directors and is therefore subject to (i) separate approval of the Board of
Directors or its designee (which approval may be withheld for any or no reason),

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(ii) determination of any exercise price and vesting schedule by the Board of
Directors, and (iii) the terms and conditions in Athena’s equity incentive plan
under which the grant is made and the applicable grant agreement form in effect
at the time of approval. Regardless of any agreement to the contrary, any grant
of a right to acquire shares of Athena stock will be solely an incentive to
potential future performance from the date of vesting forward, and Employee will
have no right to exercise that right or to acquire such stock except as
explicitly set forth in Athena’s applicable equity incentive plan and agreement
forms.

c. Section 409A Deferred Compensation Tax Savings Provision

i. Regardless of any provision of this Agreement to the contrary, to the extent
that any payment or benefit under this Agreement constitutes “non-qualified
deferred compensation” under Section 409A of the Internal Revenue Code of 1986,
as amended (“Section 409A”), and such payment or benefit is payable upon
Employee’s termination of employment, such payment or benefit shall only be
payable upon Employee’s Separation from Service. “Separation from Service” means
Employee’s separation from service from Athena, an affiliate thereof, or a
successor entity within the meaning set forth in Section 409A, determined in
accordance with the presumptions in Treasury Regulation Section 1.409A-1(h).

ii. Regardless of any provision of this Agreement to the contrary, if at the
time of Employee’s Separation from Service, Athena determines that Employee is a
“specified employee” within the meaning of Section 409A, then, to the extent
that any payment or benefit to which Employee becomes entitled under this
Agreement on account of such Separation from Service would be considered
deferred compensation subject to the 20% additional tax imposed under clause
(a)(l)(B)(i)(II) of Section 409A, such payment or benefit shall not be payable
or provided until the earlier of (A) six months and one day after Employee’s
Separation from Service or (B) Employee’s death. Any such delayed payment shall
earn interest at an annual rate equal to the applicable federal short-term rate
published by the Internal Revenue Service for the month in which the Separation
from Service occurs, from the date of Separation from Service until the payment
is made.

iii. This Agreement shall be administered in accordance with Section 409A, and,
to the extent that any provision hereof is ambiguous as to its compliance with
that Section, that provision shall be read so that all payments hereunder comply
with that Section. This Agreement may be amended at the reasonable request of
either party as necessary to fully comply with Section 409A and all related
rules and regulations in order to preserve the payments and benefits provided
hereunder without additional cost to either party.

iv. Athena makes no representation or warranty and shall have no liability to
Employee or any other person if any provision of this Agreement is determined to
constitute deferred compensation subject to Section 409A but does not satisfy an
exemption from, or the conditions of, that Section.

4. Expenses; Benefits

a. Athena shall reimburse Employee, in accordance with Athena’s policies as in
effect from time to time, for reasonable expenses incurred by Employee in
connection with the performance of Employee’s duties for Athena hereunder.

b. Employee will be entitled to paid time off (PTO) and leave of absence in
accordance with
Athena’s policies as in effect from time to time.

c. Employee will be entitled to participate in any health, life, or disability
insurance plans and retirement, pension, or profit-sharing plans that may be
offered by Athena, subject to the eligibility rules of each plan. Benefits under
each plan are governed solely by that plan, and Athena may in its sole
discretion modify or eliminate any plan or benefits thereunder on a prospective
basis by notice to Employee.

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5. Confidential Information

a. “Confidential Information” means any and all information belonging to Athena,
or belonging to any third party (e.g., any of Athena’s affiliates, clients, or
vendors) and held in confidence by Athena, that: (i) is not generally known to
the public, (ii) is designated or treated by Athena or such third party as
confidential, or (iii) would be reasonably understood to be of a confidential
nature for a company in Athena’s industry. Confidential Information may be in
any form and includes, but is not limited to, information consisting of or
relating to: algorithms, formulas, methods, models, processes, and work flows;
specifications; know-how, show­ how, and trade secrets; Assigned Intellectual
Property and Proprietary Rights (each as defined below); research and
development activities and test results; patent and trademark applications;
software, source code, and object code; contracts and arrangements; business
records; customer and vendor lists and information; marketing plans, business
plans, and financial information and projections; compensation arrangements and
personnel files; tax arrangements and strategies; intercompany arrangements;
costs, price lists, and pricing policies; and any existing or proposed
acquisition, strategic alliance, or joint venture.

b. Confidential Information shall not include information that (i) is or becomes
publicly available through no fault of Employee, (ii) is shown by written record
to have been in the possession of or known to Employee prior to the Employment
Period, (iii) is shown by written record to have been independently developed by
Employee, or (iv) is made available without restriction to Employee by a third
party outside Athena and its affiliates without breach of any confidentiality
obligation. Furthermore, this Section 5 will not apply to the extent that
Employee is required to disclose any Confidential Information by applicable law
or legal process, and, to the extent legally permissible, Employee promptly
notifies Athena of such requirement and cooperates with Athena (at Athena’s
expense) to contest or limit such disclosure.

c. During the Employment Period and at all times thereafter, Employee shall use
best efforts to hold all Confidential Information in the strictest confidence,
without disclosure to any third party (even Athena’s employees, consultants, and
professional advisors) except as necessary to perform Employee’s duties
hereunder or as expressly authorized in advance by Athena, and will use such
information solely for the purpose of performing services for Athena and not for
Employee’s own benefit or that of any third party. Employee shall not (i)
disclose or use more than the minimum amount of information necessary for the
purpose of that disclosure or use; (ii) render any services to any third party
to which Confidential Information has been, or is threatened to be, disclosed
contrary to this Section 5; or (iii) use or disclose any information that is
subject to confidentiality restrictions placed upon it by a third party and may
not be disclosed to Athena (Athena expressly disclaims any request or
requirement that Employee disclose or use any such information).

d. Employee recognizes and acknowledges that (i) Athena is regulated as a
Covered Entity under the Health Insurance Portability and Accountability Act of
1996 (“HIPAA”); (ii) in the course of employment, Employee may have access to
Protected Health Information (“PHI”), as defined under HIPAA, and other
personally identifiable information (“PH”) covered by applicable privacy laws;
and (iii) PHI and PH are Confidential Information, subject to strict
confidentially and security restrictions under HIPAA, applicable Athena
policies, and other applicable law.

e. All Confidential Information and any media containing it are and shall remain
the property solely of Athena or the third party that provided such information
to Athena, and Employee shall not obtain any right, title, or interest in or to
any Confidential Information under this Agreement or by the performance of any
obligations hereunder.

6. Intellectual Property a. Definitions
i. “Assigned Intellectual Property” means any and all Intellectual Property that
is in whole or in part authored, conceived, created, developed, discovered,
invented, learned, made, originated, prepared, or reduced to practice by
Employee, either alone or together with others, during or after the Employment
Period

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and (A) arises out of, is based upon, or incorporates any Confidential
Information; (B) is made through the use of equipment, facilities, supplies,
funds, or other property of Athena; or (C) arises out of or relates to work
performed by Employee for Athena.

ii. “Intellectual Property” means all concepts, creations, developments,
discoveries, ideas, improvements, innovations, and inventions; designs, models,
plans, and prototypes; methods, procedures, processes, shop practices, and
techniques; algorithms and formulas; data, databases, and data structures;
source and object codes, software, and computer programs; systems and
topologies; data, hardware, and user interfaces; reports and test results;
specifications; documentation, memoranda, notebooks, notes, papers, records,
workbooks, and writings; drawings, expressions, graphics, illustrations, and
photographs; dress, marks, and names; works of authorship; know-how, show-how,
and trade secrets; and any improvements on or to, or derivative works from, any
of the foregoing, whether or not reduced to writing, patented or patentable, or
registered or registrable under copyright, trademark, or similar laws.

iii. “Proprietary Rights” means any and all right, title, and interest in, to,
and under (A) patents, copyrights, trademarks, service marks, and trade names
that constitute or relate to Assigned Intellectual Property; (B) applications to
register any of the foregoing (including, but not limited to, any continuations,
divisions, extensions, and reissues of any patent application); (C) trade
secrets that constitute or relate to Assigned Intellectual Property; and (D)
goodwill associated with any of such trademarks, service marks, or trade names.

b. Employee hereby acknowledges and agrees that any Assigned Intellectual
Property that is an original work of authorship protectable by copyright is a
“work made for hire,” as that term is defined in the United States Copyright Act
of 1976, and will be automatically the property solely of Athena. If the
copyright to such Assigned Intellectual Property will not be Athena’s property
by operation of law, Employee hereby, without further consideration, assigns to
Athena all of Employee’s right, title, and interest in and to such copyright.

c. Employee hereby irrevocably and exclusively assigns to Athena all right,
title, and interest that Employee has, or at any time may come to have, in and
to any and all Assigned Intellectual Property and Proprietary Rights. During the
Employment Period and thereafter, Employee shall (i) keep and maintain adequate
and current notes and other records of all Assigned Intellectual Property, (ii)
provide such notes and records to Athena from time to time upon Athena’s
request, and (iii) provide prompt written notice to Athena of the development or
creation of any Assigned Intellectual Property or Proprietary Right. Employee
agrees to execute such instruments of assignment, confirmation, conveyance, or
transfer and other documents as Athena may reasonably request to confirm,
evidence, or perfect the assignment of all of Employee’s right, title, and
interest in and to any and all Assigned Intellectual Property and Proprietary
Rights. Employee hereby waives and quitclaims to Athena any and all claims of
any nature whatsoever that Employee may now or hereafter have in any Assigned
Intellectual Property or for infringement of any Proprietary Rights assigned
hereunder.

d. At Athena’s request and expense, Employee will assist Athena in every proper
way (including, without limitation, by executing patent applications) to obtain
and enforce Proprietary Rights in any country. Employee’s obligation under this
paragraph shall continue indefinitely after the Employment Period.

e. By this Agreement, Employee hereby irrevocably constitutes and appoints
Athena as Employee’s attorney-in-fact solely for the purpose of executing, in
Employee’s name and on Employee’s behalf, (i) such instruments or other
documents as may be necessary to evidence, confirm, or perfect any assignment
pursuant to the provisions of this Section 6 and (ii) such applications,
certificates, instruments, or documents as may be necessary to obtain or enforce
any Proprietary Rights in any country of the world. This power of attorney is
coupled with an interest on the part of Athena and is irrevocable.

f. Employee’s obligation to assign Assigned Intellectual Property and
Proprietary Rights shall not apply to any Prior Invention disclosed on Schedule
A. Employee represents that Schedule A contains a complete list of all Prior
Inventions and, if there is no Schedule A attached hereto, or if it is left
blank, there are no Prior

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Inventions. If Employee incorporates into an Athena product, service, or process
a Prior Invention or any other Intellectual Property in which Employee has an
interest, or if the manufacture, use, sale, or import of any Athena product or
service or the practice of any Athena process would infringe any Prior Invention
or any other Intellectual Property in which Employee has an interest, Athena is
hereby automatically granted a non-exclusive, royalty-free, fully paid,
irrevocable, transferable, perpetual, world-wide license under such Prior
Invention or other Intellectual Property to make, have made, modify, use,
import, and sell such Athena product or service or to practice such process,
Prior Invention, or Intellectual Property.

7. Covenant Against Competition; Non-Solicitation a. Definitions
i. “Athena’s Business” means the development, sale, support, and service of the
products and services developed or sold by Athena, or that Employee is
materially involved in planning, at any time during the Employment Period.

ii. “Competitive Services” means, during the Employment Period, any and all
services, and thereafter, all of the following that apply, collectively:

A. if Employee served at the Vice President level (or the equivalent) or higher
at Athena at any time during the twelve months immediately preceding the end of
the Employment Period, any and all services;

B. if Employee served in a software or product development role at Athena at any
time during the twelve months immediately preceding the end of the Employment
Period, any development, development management, or product innovation services;

C. if Employee served in a business development role at Athena at any time
during the twelve months immediately preceding the end of the Employment Period,
any business development services;

D. if Employee served in a sales capacity at Athena at any time during the
twelve months immediately preceding the end of the Employment Period, any sales,
sales management, sales support, or prospective client solicitation services;
and

E. in all other cases, the services provided to Athena by Employee during the
twelve months immediately preceding the end of the Employment Period.

iii. “Geographic Area” means:

A. if Employee is no longer with Athena and served in a sales capacity and at
the Director level (or the equivalent) or lower during the entire final year of
the Employment Period (or the entire Employment Period, if less than a year),
all areas assigned to Employee as a sales territory during that year;

B. if Employee is no longer with Athena and served in a business development
capacity and at the Director level (or the equivalent) or lower during the
entire final year of the Employment Period (or the entire Employment Period, if
less than a year), any third party with which Employee discussed a business
relationship or transaction, or about which Employee learned Confidential
Information, during the Employment Period; and

C. in all other cases, the United States.

iv. “Non-Compete Period” means the Employment Period, plus a period of time
immediately thereafter equal to: (A) if Employee served in a software, product,
or business development role, in a sales capacity, or at the Vice President
level (or the equivalent) or higher at any time during the final year of

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the Employment Period, then six months or, if the Employment Period was longer
than six months, one year, and (B) in all other cases, zero months.

b. The provisions of this Section 7 shall not apply to the extent that they are
invalid under applicable law (e.g., if Employee is a resident of the State of
California, the provisions of Section 7(d) shall not apply at any time following
the Employment Period).

c. Athena respects the confidentiality of third parties’ information, and
Employee shall not provide any information that is confidential to a former
employer to Athena or use such information in the performance of Employee’s
duties as an Athena employee.

d. During the Non-Compete Period, Employee shall not: (i) engage in any business
that is competitive in the Geographic Area with Athena’s Business; (ii) render
any Competitive Services in any capacity to any third party engaged in any
business competitive in the Geographic Area with Athena’s Business; or (iii) be
a director, officer, stockholder, partner, principal, manager, member, owner, or
trustee of, or joint venturer with, any business competitive in the Geographic
Area with Athena’s Business, provided that Employee may own up to 2% of an
entity’s equity securities that are traded on any national securities exchange.

e. During the Non-Compete Period, Employee shall not, in the Geographic Area,
directly or indirectly, solicit or encourage any client of Athena, or any person
or entity with which Employee had contact on behalf of Athena, to purchase or
use items or services competitive with Athena’s Business.

f.    During the Non-Compete Period, Employee shall not, directly or indirectly,
on behalf of Employee or any third party, (i) solicit or encourage any employee
of Athena or any of its affiliates to leave such employment or (ii) hire or
retain as an employee, consultant, or in any other capacity any person who has
left the employment of Athena or any of its affiliates within one year of such
hiring or retention.

8. Equitable Relief

Employee acknowledges and agrees that the rights and obligations set forth in
Sections 5, 6, and 7 of this Agreement are of a unique and special nature, that
Athena would be materially and irreparably damaged if Employee breached any of
those Sections, that monetary damages or any other remedy at law would not
adequately compensate Athena for such injury, and that the provisions of those
Sections are reasonable and necessary to preserve to Athena valuable proprietary
and confidential information that gives Athena advantage over its competitors.
Accordingly, in addition to any other rights and remedies it may have, Athena
will be entitled to (a) an injunction, specific performance, or other equitable
relief (without the necessity of posting any bond or other security or proving
damages) in case of any breach or threatened breach by Employee of Sections 5,
6, or 7 and (b) indemnification against any costs and expenses (including, but
not limited to, actual attorneys’ fees and court costs) incurred by Athena in
obtaining any relief under clause (a).

9. Notices

Notices and other communications required or permitted to be given under this
Agreement must be in writing and will be deemed to have been duly given (a) when
personally delivered; (b) on the third business day after deposit in the U.S.
mail (certified or registered mail, return receipt requested, postage prepaid);
or (c) on the next business day after timely delivery to an overnight courier;
in each case addressed to the intended recipient at the applicable address set
forth on the signature page hereto (or such other address as the intended
recipient may specify from time to time by notice to the other party).

10. Mediation; Jurisdiction; Waiver of Jury Trial

Except with respect to remedies and rights set forth in Section 8, any dispute
or controversy arising under or relating to this Agreement or concerning
Employee’s employment with or separation from Athena will be referred to
mediation administered by JAMS in accordance with its employment dispute
resolution rules.

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The mediation shall be held in the state in which the office to which Employee
reports is located, and Athena shall pay the full costs thereof, excluding
attorneys’ expenses and fees. If the dispute or controversy is not resolved
through mediation or direct negotiation, then any action relating to that
dispute or controversy must be brought in a court of competent jurisdiction in
the state in which the office to which Employee reports is located. Each party
agrees that any such dispute shall be tried by a judge alone and hereby waive
and forever renounce the right to a trial before a civil jury.

11. Miscellaneous

This Agreement may be executed in two or more counterparts, which together will
be deemed one original. This Agreement constitutes the entire agreement of the
parties with respect to the subject matter hereof and may only be amended by a
written agreement signed by both parties hereto. If any provision of this
Agreement is held to be unenforceable or overly broad, such unenforceability
shall not render any other provision unenforceable, and the court or tribunal
making such determination shall modify such provision so that the provision will
be enforceable to the broadest extent permitted by law. This Agreement will be
binding upon and inure to the benefit of both parties and their respective
successors and assigns; provided, however, that the obligations of Employee are
personal and may not be assigned by him or her. No waiver by Athena of any
breach under this Agreement will be considered valid unless in writing signed by
Athena, and no such waiver will be deemed a waiver of any subsequent breach.
This Agreement, performance hereunder, and Employee’s employment with or
separation from Athena shall be governed by the laws of the state in which the
office to which Employee reports is located, without regard to conflict of laws
principles; provided, however, that wage and hour matters shall be governed by
the laws of the state in which Employee is domiciled.

In witness whereof, the parties hereto have executed this Agreement as of the
Effective Date.
EMPLOYEE
 
ATHENAHEALTH, INC.
 
 
 
/s/ Kyle Armbrester
 
/s/ Jonathan Bush
[Signature]
 
Name: Jonathan Bush
 
 
Title: President & CEO
Print Name: Kyle Armbrester    
 
 
Print Address:             
 
311 Arsenal St, Watertown, MA 02472

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SCHEDULE A TO EMPLOYMENT AGREEMENT

Employee Name: Kyle Armbrester
Effective Date:    January 9, 2012
Position: Director of Ecosystem

Conflicting Agreements: The following is a complete list of all agreements may
prohibit, restrict, or impair the ability of Employee to work in any capacity or
position at Athena:
     
         X      No such agreements
     
                 The agreements listed below (attach a copy of each agreement)

 

Evaluation for Promotion: Six months from the Effective Date listed above,
Athena will evaluate Employee’s performance against the competencies required of
employees in the Vice President cohort level at Athena, and Athena shall decide
based on that evaluation whether Employee should be promoted to a Vice President
role.

Compensation: Employee’s base salary will be at an annual gross rate set forth
below, which rate may be increased from time to time in Athena’s sole discretion
or decreased by written consent of the parties (the “Base Salary”). The Base
Salary and any cash payments identified in Other Compensation below shall be
payable in accordance with Athena’s payroll practices, as in effect from time to
time, and shall be subject to required federal, state, and local taxes and
withholdings. Employee will be entitled to annual consideration for a bonus
based on Employee’s and Athena’s performance, provided that Employee was an
employee of Athena during the third quarter of the year in question, is not on
an action plan at the time of the performance review, and remains an employee of
Athena at the time that the bonus is to be paid. Such bonus, if any, shall be
determined by
Athena in its sole discretion, and shall be paid according to the schedule
determined by Athena. Any sales
Commissions or other performance-related payments for which Employee may be
eligible are covered separately under Athena’s Sales Incentive Plan as in effect
from time to time.

Base Salary: $180,000_

Other • 10,000 restricted stock units issuable for shares of Athena common stock
Compensation: •A hiring bonus of $15,000, to be paid following Employee’s
commencement of work at Athena, which shall not be refunded to Athena under any
circumstances.
•A hiring bonus of$15,000, to be paid following Employee’s commencement of work
at Athena, which shall be contingent upon 12 months of employment and shall be
fully refunded to Athena in the event that Employee’s employment at Athena is
terminated (whether by Athena or by Employee) prior to 12 months from the
Effective Date listed above.

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Prior Inventions: The following is a complete list of all Prior Inventions.

                No Prior Inventions

           X   Prior Inventions described below (reference and attach
additional, initialed sheets if necessary)

•    Integrated reporting framework and cloud-based platform
•    Predictive modeling engine with demographic data