**Exhibit 10.1****EMPLOYMENT AGREEMENT**This EMPLOYMENT AGREEMENT (“Agreement”) is made effective as of the date of signature by andbetween ENTREMED, INC., a Delaware corporation having its principal office at 9640 Medical CenterDrive, Rockville, MD 20850 (the “Company”) and Kenneth W. Bair, Ph.D. (the “Executive”).FOR AND IN CONSIDERATION of the mutual premises, agreements and covenants contained herein, theparties hereto, intending to be legally bound, do hereby agree as follows:1. Employment; Position and Duties.Subject to the terms hereof, the Company hereby agrees to employ the Executive during the Term (ashereafter defined) to act as, and to exercise all of the powers and functions of its Senior VicePresident, Research and Development, and to perform such acts and duties and to generally furnishsuch services to the Company and its subsidiaries (if any) as is customary for a senior managementperson with a similar position in like companies, such services to include 1) responsibility forthe Company’s overall research and development activities, including project management,coordination of outsourced research, and nonclinical development activities, and 2) fulloperational responsibility for the Company’s research and development programs, including programdirection and budget responsibility. Executive shall report directly to the Chief ExecutiveOfficer (“CEO”) of the Company and have such other powers, duties and responsibilities as the CEO,in consultation with and approval of the Board of Directors (the “Board”), shall from time to timereasonably prescribe. Executive will be a member of the Company’s Senior Management Team and theBusiness Development Committee and will be the Company’s representative on the Scientific AdvisoryBoard, subject to approval by the Board as a named executive officer. Executive hereby agrees toaccept such employment and shall perform and discharge faithfully, diligently, and to the best ofhis abilities such duties and responsibilities and shall devote sufficient working time and effortsto the business and affairs of the Company and its subsidiaries.2. Place of Employment.While Executive is employed by the Company during the Term, Executive shall conduct his duties andresponsibilities hereunder primarily from the executive offices located in Rockville, Maryland(except for routine and customary business travel), or from such other location in the WashingtonD.C. metropolitan area as designated from time to time by the CEO.3. Compensation     a. Base Salary. While the Company employs Executive during the Term, the Companyshall pay to Executive an annual base salary (“Base Salary”) of no less than $320,000, payable inaccordance with the Company’s customary payroll policy for its executives.
 

 
     b. Base Salary Adjustments. Executive’s Base Salary shall be reviewed at leastannually in accordance with the Company’s customary practices for its executives. The Board or acommittee thereof may make such adjustments, as it deems appropriate in its sole discretion;provided, however, in no event shall the Company pay Executive a Base Salary of less than $320,000.In making such adjustments the Board or a committee thereof may solicit and give consideration tothe views of the CEO.     c. Incentive Compensation. While the Company employs Executive during the Term,Executive’s annual incentive compensation (“Incentive Compensation”) shall be targeted at 30% ofbase compensation, the exact amount of which shall be determined by the Board or a committeethereof in its sole discretion. Executive shall be eligible for Incentive Compensation commencingat the start of the Initial Term. Such bonus, if any, shall be paid within ninety (90) daysfollowing the last day of each fiscal year of the Company. In making such determinations, the Boardor a committee thereof may solicit and take into consideration the views of the CEO.     d. Certain Other Benefits. While the Company employs Executive during the Term,Executive shall be entitled to participate in any and all employee benefit plans and arrangementswhich are available to senior executive officers of the Company, including without limitation,group medical, disability and life insurance plans, and Company’s Directors and Officers (D&O)insurance policy. Executive shall also be afforded no fewer than twenty-three (23) days paid timeoff (PTO) pursuant to policies fixed by the Company.     e. Expenses. The Company shall pay or reimburse Executive for all reasonable businessexpenses actually paid or incurred by Executive while Executive is employed by the Company duringthe Term subject to reasonable documentation and in accordance with the Company’s business expensereimbursement policy.     f. Relocation Expenses.     (i). The Company shall reimburse Executive an aggregate of $200,000 for relocationexpenses (the “Relocation Expense Payment”), consisting of (i) $100,000, payable in a lumpsum within thirty (30) days of the date of this Agreement and (ii) $100,000 upon the sale ofExecutive’s principal residence in Oakland, California, payable upon the closing of suchsale. The Relocation Expense Payment shall be used by Executive in his discretion forrelocation expenses including, but not limited to, moving company expenses, house hunting,temporary housing, temporary storage or vehicle transportation costs, and real estatecommissions in connection with the sale of his residence in Oakland, California.     (ii). If Executive terminates his employment without Good Reason or is terminated forCause within twenty four (24) months of the date of this Agreement, Executive shallreimburse the Company for all or a portion of the Relocation Expense Payment as follows:     (a) if the termination occurs within twelve months of the date of thisAgreement, Executive shall repay 75% of the Relocation Expense Payment;
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     (b) if the termination occurs at any time between thirteen (13) and eighteen(18) months of the date of this Agreement, Executive shall repay 50% of theRelocation Expense Payment; and     (c) if the termination occurs within nineteen (19) and twenty four (24)months of the date of this Agreement, Executive shall repay 25% of the RelocationExpense Payment.Any reimbursement by Executive to the Company of the Relocation Expense Payment in accordance withthis Section 3(f) shall be made within **(10)**business days of Executive’s termination date, payablein a lump sum. For the purposes of clarification, Executive shall not be obligated to reimbursethe Relocation Expense Payment in the event of a termination as a result of Death, Disability,change in control, termination by Executive for Good Reason, termination by Company without Cause,or termination as a result of the Company not seeking term renewal.     g. Legal Fees. The Company shall reimburse Executive up to $2,500 for legal feesactually paid or incurred in connection with the preparation and execution of this Agreement.4. Term.     The term of this Agreement shall be the period commencing on October 16, 2007 and continuing forone year (the “Initial Term”); provided, however, that the Term of this Agreement shall be extendedautomatically for successive one year periods (each one-year extension a “Successor Term” andtogether with the Initial Term referred to herein as the “Term”) unless written notice ofnonextension is provided by either party to the other party at least thirty (30) days prior to theend of the Initial Term or any Successor Term. In the event that this Agreement is not extended atthe end of the Initial Term or any Successor Term and thereby terminates, only paragraphs 6, 7,8(d), 8(g), 8(h), 8(i) and 11 shall survive such termination, except that Executive shall beentitled to receive compensation and benefits to the extent expressly provided herein or by theterms of any of the Company’s compensation and benefit plans, programs or policies or as requiredby applicable law.5. Stock Options.Upon the Executive’s commencement of employment, the Company will grant stock options to Executivecovering 350,000 shares of common stock with a per share exercise price equal to the closing priceof EntreMed’s stock on the date of grant. Such options will vest as to 25% of the covered sharesthree months after the grant date, and shall vest as to the remaining covered shares in cumulative25% share increments on each of the first, second, and third anniversary of the date of grant, ifExecutive is then employed by the Company. Other periodic stock and incentive stock option grantsto Executive, if any, while the Company employs Executive during the Term shall be determined bythe Board or a committee thereof in its discretion. In the event of a termination pursuant toparagraph 8(d) hereof or a resignation pursuant to paragraph 9 hereof, for which purposes sections10(a) and 10(c) of this Agreement shall control, all vested options held by Executive on theeffective date of such termination or resignation shall be
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exercisable in accordance with the terms of such grants until the later of the date set forth insuch grant or twelve (12) months following Executive’s date of termination, but in no event beyondthe expiration date of the relevant option. Upon a change in control, as defined in the Executive’soption agreement, all unvested options shall vest and become exercisable immediately. Except as setforth herein, the terms of the stock option grants under this paragraph 5 shall be otherwise inaccordance with and subject to the terms of the Company’s 2001 Long Term Incentive Plan orsuccessor plan and such terms and conditions as the Board or a committee thereof may specify.6. Unauthorized Disclosure.During the Term and at all times thereafter, Executive shall not, without the written consent ofthe Company, or except as required by applicable law, disclose to any person, other than a personto whom disclosure is reasonably necessary or appropriate in connection with the performance byExecutive of his duties as an executive officer of the Company, any material confidentialinformation obtained by Executive while in the employ of the Company with respect to the businessesof the Company or any of its subsidiaries, including but not limited to, operations, pricing,contractual or personnel data, products, discoveries, improvements, trade secrets, licenseagreements, marketing information, suppliers, dealers, principles, customers, or methods ofdistribution, or any other confidential information the disclosure of which Executive knows, or inthe exercise of reasonable care should know, will be damaging to the Company; provided, however,that confidential information shall not include any information known generally to the public or topersons in the industry of which the Company’s business is a part (in each case, other than as aresult of unauthorized disclosure by Executive) or any information otherwise considered by theCompany not to be confidential.7. Indemnification.      a. The Company shall defend, indemnify and hold harmless Executive if he is made a party, orthreatened to be made a party, to any threatened, pending or completed action, suit or proceeding,whether civil, criminal, administrative, or investigative (a “Proceeding”), because he is or was anofficer or director of the Company or any of its subsidiaries, affiliates, or successors, orbecause he is or was serving in a fiduciary capacity with respect to employee benefit plans of theCompany, whether or not the basis of such Proceeding is alleged action in an official capacity orotherwise, against all Expenses incurred or suffered by him in connection with such Proceeding tothe fullest extent authorized by the General Corporation Law of the State of Delaware and any otherapplicable law in effect from time to time, and such indemnification shall continue as to Executiveeven if he ceases to be an officer or director or is no longer employed by the Company, and shallinure to the benefit of Executive’s heirs, executors and administrators.     b. As used in this Agreement, the term “Expenses” shall include, without limitation, damages,losses, judgments, liabilities, fines, penalties, excise taxes, settlements and reasonable costs,reasonable attorneys’ fees, reasonable accountants’ fees, and reasonable disbursements and costs ofattachment or similar bonds, investigations, and any reasonable expenses of establishing a right toindemnification under this Agreement.
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     c. Expenses incurred by Executive in connection with any Proceeding shall be paidby the Company upon presentation of appropriate documentation and a giving by Executive of anyundertakings required by applicable law.8. Termination.     a. Upon Death. If Executive dies while employed by the Company during the Term, hisestate shall be entitled to receive payment of Base Salary through the last day of the nine (9)months following the month in which his death occurred, payable over nine (9) months at theCompany’s normal pay periods. If, in respect of the fiscal year in which Executive dies the Boardor a committee thereof determines in its discretion that he would otherwise have been entitled toreceive Incentive Compensation under subparagraph 3(c) by reason of the operations of the Companyduring such fiscal year, Executive’s estate shall be entitled to receive a pro rata portion of hisIncentive Compensation for such fiscal year. Such pro rata portion shall equal the product of (x)the full amount of such Incentive Compensation, and (y) a fraction, the numerator of which is thenumber of days in the fiscal year of Executive’s death prior to the date of death, and thedenominator of which is the total number of days in such fiscal year.     b. Termination Upon Disability. The Company may terminate Executive’s employmenthereunder during the Term at the end of any calendar month in the event of his Disability by givingto Executive written notice of termination. In the event of any such termination pursuant to thissubparagraph 8(b), Executive shall be entitled to receive his Base Salary, payable in accordancewith the Company’s customary payroll policy for it executives, through the last day of the nine (9)months following the month in which the date of termination occurred. If in respect of the fiscalyear in which Executive’s employment terminates pursuant to this subparagraph 8(b) the Board or acommittee thereof determines in its discretion that he would otherwise have been entitled toreceive Incentive Compensation under subparagraph 3(c) by reason of the operations of the Companyduring such fiscal year, Executive shall be entitled to receive a pro rata portion of his IncentiveCompensation for such year. Such pro rata portion shall equal the product of (x) the full amountof such Incentive Compensation, and (y) a fraction, the numerator of which is the number of days inthe fiscal year of Executive’s termination on account of Disability prior to the date oftermination, and the denominator of which is the total number of days in such fiscal year.     c. Termination for Cause. The Company may terminate Executive’s employment hereunderat any time during the Term for Cause by giving to Executive written notice of termination thatspecifies the reasons for and date of termination, subject to the terms of sub-paragraph 10(a)hereunder. Upon any such termination for Cause under this subparagraph 8(c), the Company shall payto Executive Base Salary through the date of termination, including the benefits provided atparagraph 3(d), and the Company shall have no further obligations under this Agreement.     d. Termination Without Cause. The Company may terminate Executive’s employment withthe Company at any time during the Term, for any reason and without Cause, by giving him writtennotice thirty (30) days prior to the date of termination. Until the effective date of any suchtermination, the Company shall continue to pay to Executive the full compensation specified in thisAgreement, including the benefits provided at paragraph 3(d). Following the date of termination,Executive shall make himself reasonably available to
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members of the Board, the CEO, and other senior managers and officers of the Company to assist inthe transition of responsibilities and information to others and to facilitate the orderly conductof business operations. Upon termination, the Company shall have no other financial obligations toExecutive under any compensation or benefit plan, program or policy and Executive’s participationin the Company’s compensation and benefit plans, programs and policies shall cease as of the dateof Executive’s termination except as set forth herein or as expressly provided under the terms ofany such plans, programs or policies, or as required by applicable law. However, in addition to theabove, if Executive is terminated pursuant to this subparagraph 8(d), the Company shall (i) payExecutive a severance amount equal to nine (9) months Base Salary over the following nine (9)months at the Company’s normal pay periods, and (ii) provide Executive coverage under the Company’shealth insurance program, under the same terms as are available to other senior executive officersof the Company, for a period of nine (9) months, after which Executive would be eligible for COBRAcontinuation coverage, or until he has obtained substantially equivalent new coverage, asdetermined by the Board or a committee thereof in its discretion, through successor employment,whichever occurs sooner. If, in respect of the fiscal year in which Executive’s employmentterminates pursuant to this subparagraph 8(d), the Board or a committee thereof determines in itsdiscretion that he would otherwise have been entitled to receive Incentive Compensation undersubparagraph 3(c) by reason of the operations of the Company during such fiscal year, Executiveshall be entitled to receive a pro rata portion of his Incentive Compensation for such year. Suchpro rata portion shall equal the product of (x) the full amount of such Incentive Compensation, and(y) a fraction, the numerator of which is the number of days in the fiscal year of Executive’stermination without Cause prior to the date of termination, and the denominator of which is thetotal number of days in such fiscal year.     e. Resignation for Other than Good Reason. Executive may voluntarily terminate hisemployment with the Company during the Term for any reason upon at least thirty (30) days priorwritten notice, which specifies the effective date of termination. Until the effective date ofsuch termination, the Company shall continue to pay him the full compensation specified in thisAgreement, including the benefits provided at paragraph 3(d), provided he continues to perform hisduties during this period. Thereafter, the Company shall have no further obligations to him underthis Agreement. This subparagraph 8(e) shall not apply to Executive’s resignation for Good Reasonpursuant to paragraph 9 hereof.     f. No Mitigation. The parties hereto acknowledge and agree that, in the eventExecutive’s employment with the Company is terminated pursuant to this paragraph 8, he shall not berequired to mitigate his damages by affirmatively seeking other employment. Further, except asprovided in subparagraph 8(d)(ii) above, the amount of any payment or benefit provided for in thisAgreement shall not be reduced by any compensation earned by him or benefit provided to him as theresult of employment by another employer or otherwise.
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     g. Non-Competition. For a period of 1) twelve (12) months after resignation for otherthan for Good Reason or 2) six (6) months after termination of employment with the Company for anyother reason, Executive shall not, as an individual, principal, agent, employee, consultant orotherwise, directly or indirectly, or with respect to any company or entity with which the Companyhas concluded partnership, licensing, joint research and development or other similar businessagreements during his employment with the Company, render any services to any firm or company orany division or subsidiary of any firm or company, engaged in the development or commercializationof compounds, analogs or derivatives of those compounds that (a) are of a similar type, that is,small molecules, (for example, but not limited to, small peptidomimetic molecules), (b) have morethan one mechanism of action and cellular pathway in common with; and (c) are within the same field(i.e. oncology or inflammation) as, those being developed and or commercialized bythe Company during the Term (“Competing Company”). In addition, for an additional period of six(6) months after the six-month period set forth above and subject to Section 6 hereof, Executiveonly may provide services to such a Competing Company if Executive does not work on, or furnishconfidential information regarding, any matter related to such compounds defined above. Moreover,for a period of [twelve (12)] months after the termination of Executive’s employment with theCompany, Executive shall not take any action, without the prior written consent of the Company, toassist Executive’s successor employer or any other entity in recruiting or hiring any otheremployee who was an employee of the Company during Executive’s employment. This prohibitionincludes (i) identifying to such successor employer or its agents or such other entity, the personor persons who have special knowledge concerning the Company or its inventions, processes, methodsor confidential affairs, and (ii) commenting to Executive’s successor employer or its agents orsuch other entity about the quantity or work, quality of work, special knowledge or personalcharacteristics of any person who is still employed by the Company. Executive also agrees that hewill not provide such information to a prospective employer or to an executive search firm duringinterviews preceding possible employment.     h. Non-Disparagement. During the Term and thereafter, Executive shall not communicatenegatively about or otherwise disparage the Company or its products or each and any of the releasedparties described in subparagraph 8(i) in any way whatsoever except as may be required for truthfulsworn testimony or in connection with a legal or administrative proceeding, report, claim ordispute. The Company, acting in its official capacity, shall not make any public false, disparagingor derogatory statements in connection with or concerning Executive’s service to the Company exceptas may be required for truthful sworn testimony or in connection with a legal or administrativeproceeding, report, claim or dispute. After termination, in the event Executive materially breachesany of the conditions set forth herein or in any other paragraph of this Agreement, the Company maydiscontinue the provision of any payment or benefits to him under this Agreement, and in such eventhe shall forfeit his entitlement to any further termination payments or benefits under thisAgreement. After termination, in the event the Company materially breaches any of the conditionsset forth herein or in any other paragraph of this Agreement, the Executive may pursue any remediesavailable to him at law.     i. Release. In consideration of Executive’s receipt of severance benefits subject toand in accordance with subparagraphs 8(b) and (d) and paragraph 9 of this Agreement, Executiveagrees that, upon his first receipt and acceptance of any such benefits, he shall have released andforever discharged the Company, its subsidiaries and affiliates, successors and assigns,
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predecessors and all of their respective officers, directors, employees and agents andemployee benefits plans from all claims, demands, liabilities and causes of action arising out offacts or occurrences arising or occurring at any time up to and including the time of Executive’stermination or resignation, whether known or unknown, and the parties hereto contemplate that thisrelease shall be broadly construed.9. Resignation for Good Reason.If Executive has Good Reason during the Term, Executive may resign at any time during the Term byproviding at least thirty (30) days prior written notice to the Company that specifies the reasonfor, and the effective date of, his resignation. If Executive resigns during the Term for GoodReason, such resignation shall be deemed a Termination without Cause under subparagraph 8(d) hereofand Executive shall receive the compensation and benefits provided under subparagraph 8(d) hereofas if he had been terminated without Cause.10. Definitions.     a. *“Cause”*shall mean Executive’s (i) habitual drunkenness or drug addiction, (ii) materialfailure to perform and discharge his duties and responsibilities hereunder, (iii) misconduct thatis materially and significantly injurious to the Company, (iv) conviction of a felony involving thepersonal dishonesty of Executive or moral turpitude, (v) conviction of any crime or offenseinvolving the property of the Company or (vi) material breach of Executive’s obligations under thisAgreement. Provided, however, with regard to a.(ii) and a.(vi.) above, the parties exclude for thispurpose an action not taken in bad faith that is remedied by Executive promptly upon receipt ofwritten notice thereof given to the Company.     b. *“Disability”*shall mean the Executive’s incapacity due to physical or mental illness whichprevents the proper performance of Executive’s duties as set forth herein or established pursuanthereto for ninety (90) days in any twelve (12) month period of the Term. A qualified independentphysician mutually selected by the Company and the Executive shall determine any questions as tothe existence or extent of illness or incapacity of Executive, upon which the Company and Executivecannot agree. The determination of such physician certified in writing to the Company and to theExecutive shall be final and conclusive for all purposes of this Agreement. For purposes of thedisability provisions of this Agreement, if the Executive is unable to act on his own behalf due toincapacity, any person legally authorized to do so may act on the Executive’s behalf.     c. *“Good Reason”*shall mean the occurrence of any of the following events during the Term:(A) the assignment to Executive of any duties inconsistent in any material respect with Executive’sposition, authority, duties or responsibilities as of the commencement of the Term or any otheraction by the Company which results in a diminution in any material respect in such position,duties or responsibilities, excluding for this purpose an isolated and inadvertent action not takenin bad faith that is remedied by the Company promptly after receipt of written notice thereof givenby Executive; (B) a reduction by the Company in Executive’s annual Base Salary as in effect on thedate hereof or subsequently in effect hereunder, except as agreed to by Executive, unless suchchange was applicable to all senior executives of the Company; (C) the failure by the Company tocontinue to provide Executive with benefits substantially similar to
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those enjoyed by him under any of the Company’s pension, life insurance, medical, health andaccident, disability or other welfare plans in which he was participating as of the commencement ofthe Term or subsequently in effect hereunder, unless such change was applicable to all seniorexecutives of the Company; (D) the failure by the Company to pay to Executive any deferredcompensation when due under any deferred compensation plan or agreement applicable to him; (E) thefailure by the Company to honor in any material respect the terms and provisions of this Agreement;or (G) a requirement by the Company that Executive conduct his duties and responsibilities from apermanent location more than fifty (50) miles from the place of employment, as defined in paragraph2 herein.11. Miscellaneous.     a. Assignments and Binding Effect. The respective rights and obligations of theparties under this Agreement shall be binding upon the parties hereto and their heirs, executors,administrators, successors, and assigns, including, in the case of the Company, any othercorporation or entity with which the Company may be merged or otherwise combined and, in the caseof Executive, his estate or other legal representatives.     b. No Assignment of Benefits. Except as otherwise provided herein or by applicablelaw, no right or interest of the Executive under this Agreement shall be assignable ortransferable, in whole or in part, either directly or by the operation of law or otherwise,including without limitation execution, levy, garnishment, attachment, pledge or in any manner; noattempted transfer thereof shall be effective.     c. Governing Law. This Agreement shall be governed as to its validity, interpretationand effect by the laws of the State of Maryland, without reference to its conflict of lawsprovisions.     d. Severability. In the event that any provision or portion of this Agreement shallbe determined to be invalid, illegal, or unenforceable for any reason, the remaining provisions andportions of this Agreement shall remain in full force and effect to the fullest extent permitted bylaw. Such invalid, illegal or unenforceable provision(s) shall be deemed modified to the extentnecessary to make it (them) valid, legal, and enforceable.     e. Withholding. All amounts payable hereunder shall be paid net of any applicablewithholding required under federal, state or local laws and any additional withholding to whichExecutive has agreed.     f. Entire Agreement; Amendments. This Agreement constitutes the entire Agreement andunderstanding of the Company and Executive with respect to the terms of Executive’s employment withthe Company and supersedes all prior discussions, understandings and agreements with respectthereto.     g. Captions. All captions and headings used herein are for convenient reference onlyand do not form part of this Agreement.
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     h. Waiver. No provision of this Agreement may be modified, waived or dischargedunless such modification, waiver or discharge is agreed to in writing and signed by the Executiveand the Board or its delegate. The failure of the Company or the Executive to insist uponstrict compliance with the terms of this Agreement or the failure of the Company or the Executiveto assert any right the Company or the Executive may have hereunder shall not be deemed a waiver ofsuch provision or right or any other provision of this Agreement.     f. Notice. Any notice or communication required or permitted under this Agreementshall be made in writing and shall be delivered by hand, or mailed by registered or certified mail,return receipt requested, first call postage prepaid, addressed as follows:If to Executive:Kenneth W. Bair, Ph.D.