Exhibit 10.3

LOAN AGREEMENT
 
among
 
  BOSTON SCIENTIFIC CORPORATION
 
as Purchaser,
 
and
 
CORAUTUS GENETICS INC.
 
and
 
VASCULAR GENETICS INC.
 
as Issuers
 
Dated as of July 30, 2003

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TABLE OF CONTENTS

     
Page
  ARTICLE I      DEFINITIONS AND ACCOUNTING TERMS         SECTION 1.01 Certain
Defined Terms 1  SECTION 1.02 Additional Definitions 3  SECTION 1.03
Interpretation and Rules of Construction 3  SECTION 1.04 Accounting Terms 4   
ARTICLE II     SUBSCRIPTION FOR THE NOTES         SECTION 2.01 Issuance of Notes
4  SECTION 2.02 Request for Funding 4    ARTICLE III     CONDITIONS TO
SUBSCRIPTIONS         SECTION 3.01 Conditions Precedent to Subscription for Each
Note 5    ARTICLE IV      TERMINATION         SECTION 4.01 Termination 6   
ARTICLE V     MISCELLANEOUS         SECTION 5.01 Public Announcements and
Publications 6  SECTION 5.02 Amendments, Etc 6  SECTION 5.03 Notices 7  SECTION
5.04 No Waiver; Remedies 8  SECTION 5.05 Treatment of Note 8  SECTION 5.06 Costs
and Expenses 8  SECTION 5.07 Binding Effect 8  SECTION 5.08 Survival 8  SECTION
5.09 Severability 8  SECTION 5.10 Entire Agreement 8  SECTION 5.11 No Third
Party Beneficiaries 8  SECTION 5.12 Governing Law; Jurisdiction and Enforcement
8  SECTION 5.13 Dispute Resolution 9  SECTION 5.14 Counterparts 9  SECTION 5.15
Waiver of Jury Trial 9 

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Exhibit A -       Form of Senior Convertible Promissory Note

Exhibit B -        Form of Notice of Borrowing

Exhibit C -        Form of Opinion of Counsel to the Company

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Exhibit 10.3

LOAN AGREEMENT

                     LOAN AGREEMENT (this “Agreement”) is made and entered into
this 30th day of July, 2003, among CORAUTUS GENETICS INC., a Delaware
corporation (“Parent”), and its wholly-owned subsidiary, VASCULAR GENETICS INC.,
a Delaware corporation (“VGI” and, together with the Parent, the “Issuers”), and
BOSTON SCIENTIFIC CORPORATION, a Delaware corporation (the “Purchaser” and,
together with the Issuers, the “Parties”).

                     WHEREAS, pursuant to the Investment Agreement, dated July
30, 2003, between Parent and Purchaser (the “Investment Agreement”), Parent and
Purchaser agreed, subject to the conditions set forth in the Investment
Agreement, to enter into this Agreement, an Investor Rights Agreement, a
Development Agreement (the “Development Agreement”), a Distribution Agreement
and a Patent Sublicense Agreement (collectively, with this Agreement and the
Investment Agreement, the “Transaction Documents”); and

                     WHEREAS, the Purchaser is willing to fund the Issuers’
research and development and clinical trials conducted in accordance with the
Development Agreement, by subscribing for, subject to the terms and conditions
of this Agreement, up to three senior convertible promissory notes of the
Issuers, each in principal amount of U.S. $5,000,000;

                     NOW, THEREFORE, in consideration of the premises and the
mutual representations and warranties, agreements and covenants hereinafter set
forth, the Parties hereby agree as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

                     SECTION 1.01  Certain Defined Terms.  As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):

            ”Action” means any claim, action, suit, arbitration, inquiry,
proceeding or investigation by or before any Governmental Authority.

            ”Change of Control” means (in one transaction or a series of
transactions) (i) any Person or “group” of Persons (determined based on Rule
13d-5(b) under the Exchange Act), other than one of the Issuers, becomes the
“beneficial owner” (as defined under Rule 13d-3 under the Exchange Act) of more
than 50% of the equity securities of either Issuer, (ii) individuals who on the
date of this Agreement constituted the board of directors of Parent (together
with any new directors whose election by Parent’s board of directors or whose
nomination by Parent’s board of directors for election by Parent’s stockholders
was approved by a vote of at least a majority of the members of Parent’s board
of directors then in office who either were members of Parent’s board of
directors on the date of this Agreement or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the members of Parent’s board of directors then in office, (iii)
Parent conveys, transfers or leases all or

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  substantially all of its assets to any Person, (iv) after giving effect to any
merger, consolidation or reorganization of Parent, the stockholders of Parent
immediately prior to such merger, consolidation or reorganization do not hold
more than 50% of the equity securities of the surviving corporation, or any
other Person or “group” (as defined above) holds 30% or more of the equity
securities of the surviving corporation, or (v) the board of directors of Parent
approves any of the foregoing or Parent enters into a definitive agreement with
any Person with respect to any of the foregoing.

            ”Distribution Agreement” means the Distribution Agreement entered
into as of the date hereof between the Parent and the Purchaser.

            ”Exchange Act” means the Securities Exchange Act of 1934, as
amended.

            ”Governmental Authority” means any United States or non-United
States federal, national, supranational, state, provincial, local, or similar
government, governmental, regulatory or administrative authority, agency or
commission or any court, tribunal, or judicial or arbitral body.

            ”Governmental Order” means any order, writ, judgment, injunction,
decree, stipulation, determination or award entered by or with any Governmental
Authority.

            ”Investor Rights Agreement” means the Investor Rights Agreement
entered into as of the date hereof between the Parent and the Purchaser.

            ”Law” means any applicable United States or non-United States
federal, national, supranational, state, provincial, local or similar statute,
law, ordinance, regulation, rule, code, order, requirement or rule of law.

            ”Milestones” means the following:

            ”Milestone I” means the initiation of a Phase IIb clinical trial for
the Product not later than June 30, 2004;

            ”Milestone II” means the closing of an equity round of financing,
after the date hereof with net proceeds received by the Company of at least
$10,000,000, and future commitments of at least an additional $10,000,000; and

          ”Milestone III” means the enrollment of at least 100 patients in a
phase III clinical trial for the Product.

             Milestones may be met in any order.

            ”Net Current Assets” means, with respect to any Person, (a) all
assets of such Person that would be classified as current assets, after
deducting appropriate and adequate reserves therefrom in each case in which a
reserve is proper in accordance with GAAP, less (b) all liabilities of such
Person that would be classified as current liabilities, in the case of (a) and
(b) in accordance with GAAP, on the balance sheet of a company conducting a
business the same as or similar to that of such Person.

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            ”Patent Sublicense Agreement” means the Patent Sublicense Agreement
entered into as of the date hereof between the Parent and the Purchaser.

            ”Person” means any individual, partnership, firm, corporation,
limited liability company, association, trust, unincorporated organization or
other entity, as well as any syndicate or group that would be deemed to be a
person under Section 13(d)(3) of the Exchange Act.

            ”Product” has the meaning assigned to such term in the Development
Agreement.

            ”Solvent” and “Solvency” mean, with respect to any Person on any
date of determination, that on such date (a) the fair value of the property of
such Person is greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person, (b) the present fair salable
value of the assets of such Person is not less than the amount that will be
required to pay the probable liability of such Person on its debts as they
become absolute and matured, (c) such Person does not intend to, and does not
believe that it will, incur debts or liabilities beyond such Person’s ability to
pay such debts and liabilities as they mature and (d) such Person is not engaged
in business or a transaction, and is not about to engage in business or a
transaction, for which such Person’s property would constitute an unreasonably
small capital. The amount of contingent liabilities at any time shall be
computed as the amount that, in the light of all the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to
become an actual or matured liability.

                     SECTION 1.02  Additional Definitions.  The following terms
have the meanings assigned to such terms in the corresponding Sections set forth
below:

    Definition

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Location

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  “Agreement”   Preamble     “Development Agreement”   Recitals     “GAAP”  
1.04     “Investment Agreement”   Recitals     “Issuers”   Preamble     “Note”  
2.01     “Notice of Borrowing”   2.02     “Notice of Disagreement”   5.13    
“Parties”   Preamble     “Parent”   Preamble     “Purchaser”   Preamble    
“Transaction Documents”   Recitals     “VGI”   Preamble  

                     SECTION 1.03   Interpretation and Rules of
Construction.  In this Agreement, except to the extent that the context
otherwise requires:

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    (i)       when a reference is made in this Agreement to an Article, Section,
Exhibit or Schedule, such reference is to an Article or Section of, or a
Schedule to, this Agreement unless otherwise indicated;

    (ii)       headings for this Agreement are for reference purposes only and
do not affect in any way the meaning or interpretation of this Agreement;

    (iii)       whenever the words “include”, “includes” or “including” are used
in this Agreement, they are deemed to be followed by the words “without
limitation”;

    (iv)       the words “hereof”, “herein” and “hereunder” and words of similar
import, when used in this Agreement, refer to this Agreement as a whole and not
to any particular provision of this Agreement;

    (v)       all terms defined in this Agreement have such defined meanings
when used in any certificate or other document made or delivered pursuant
hereto, unless otherwise defined therein;

    (vi)       the definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms;

    (vii)       any Law defined or referred to herein or in any agreement or
instrument that is referred to herein means such Law or statute as from time to
time amended, modified or supplemented, including by succession of comparable
successor Laws; and

    (viii)      all references in this Agreement to currency, monetary values
and dollars shall mean United States (U.S.) dollars and all payments hereunder
shall be made in United States dollars.

                     SECTION 1.04   Accounting Terms.  All accounting terms not
specifically defined herein shall be construed in accordance with United States
generally accepted accounting principles (“GAAP”).

ARTICLE II

SUBSCRIPTION FOR THE NOTES

                     SECTION 2.01   Issuance of Notes.  Upon the terms and
subject to the conditions contained in this Agreement, the Purchaser agrees to
subscribe for up to three senior convertible promissory notes of the Issuers,
each in principal amount of U.S. $5,000,000 and in the form attached as Exhibit
A hereto (each a “Note”).

                     SECTION 2.02  Request for Funding.  The Issuers shall make
any request of the Purchaser to subscribe for a Note by delivering a notice to
the Purchaser, given not later than 3:00 P.M. (New York City time) ten (10)
Business Days prior to the date of the proposed issuance of the Note by the
Issuers. Each such notice (a “Notice of Borrowing”) shall be made in writing, in
substantially the form of Exhibit B hereto, specifying therein the requested
date of

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such issuance. Each Notice of Borrowing shall be irrevocable and binding on the
Issuers. Subject to the terms and conditions of this Agreement, the Purchaser
shall, before 3:00 P.M. (New York City time) on the date of issuance, make such
funds available to the Issuers as directed in the Notice of Borrowing.

ARTICLE III

CONDITIONS TO SUBSCRIPTIONS

                     SECTION 3.01   Conditions Precedent to Subscription for
Each Note.  The obligation of the Purchaser to subscribe for any Note shall be
subject to the satisfaction (or waiver by the Purchaser in its sole discretion)
of the conditions set forth in this Article III, and each of the giving by the
Issuers of the applicable Notice of Borrowing and the acceptance by Issuers of
the proceeds of such Note subscription shall constitute a joint and several
representation and warranty by the Issuers that on the date of the issuance of
such Note each of the following statements are true and correct in all
respects):

    (a)       the representations and warranties contained in Article III of
such Note are true and correct in all material respects on and as of the date of
the issuance of such Note; provided that to avoid a second materiality
qualification any representation and warranty that is qualified by materiality
or Material Adverse Effect shall be true and correct in all respects as of the
date of the issuance of such Note, before and after giving effect to the
issuance of such Note and to the application of the proceeds therefrom, as
though made on and as of such date;

    (b)       no event has occurred and is continuing that would constitute a
Default (as defined in the Note);

    (c)       there has not been any material breach by the Parent of any of the
Transaction Documents, including, without limitation, a material breach by the
Parent of its representations and warranties set forth in the Investment
Agreement or of its exclusivity obligations under the Distribution Agreement, in
each case, which breach has not been remedied;

    (d)       from and after the date of this Agreement, the Issuers shall have
performed and observed in all material respects with every term, covenant and
agreement contained in Article IV of the form of Note attached as Exhibit A
hereto; provided that to avoid a second materiality qualification any term,
covenant and agreement contained in Article IV of the form of the Note that is
qualified by materiality shall be performed without any materiality qualifier,
as if such covenants and agreements were fully set forth in this Agreement;

    (e)       after giving effect to the issuance of the Note, the Net Current
Assets of the Parent, on a consolidated basis, shall be in excess of $4,000,000
and the Issuer shall provide the Purchaser evidence reasonably satisfactory of
the compliance thereof;

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              (f)         both immediately prior to issuing the Note and
immediately after giving effect to the issuance of the Note and the application
of the proceeds therefrom, each Issuer, individually and together with its
Subsidiaries collectively, shall be Solvent.

              (g)         the Purchaser shall have received on or before the
issuance of such Note, in form and substance reasonably satisfactory to the
Purchaser, certified copies of the resolutions of the Issuers approving the
issuance of such Note, and all documents evidencing other necessary corporate
action, if any, with respect thereto;

              (h)         with respect to the issuance of each Note, the
Purchaser shall have received an opinion of counsel to the Company addressed to
the Purchaser, substantially in the form attached hereto as Exhibit C;

              (i)         Milestone I, Milestone II or Milestone III shall have
been satisfied (it being understood that Milestones may be met in any order but
that a given Milestone, once applied to satisfy this condition precedent to
subscription of a Note, may not be used to satisfy this condition precedent with
respect to any subsequent Note issuance); and

              (j)         there shall be no Governmental Order in effect, and no
Action shall be pending or threatened, in each case against the Purchaser or an
Issuer, that would be reasonably expected to materially adversely impair the
benefits of any of the Transaction Documents to the Purchaser.

ARTICLE IV

TERMINATION

                   SECTION 4.01   Termination.    This Agreement shall terminate
automatically upon any of (a) the termination of any of the other Transaction
Documents or (b) a Change of Control. Upon termination of this Agreement, the
Purchaser shall have no further obligation to subscribe for any Notes hereunder.

ARTICLE V

MISCELLANEOUS

                   SECTION 5.01   Public Announcements and Publications.  
Except as required by Law or by the requirements of any securities exchange on
which the securities of a Party hereto are listed, no Party shall make, or cause
to be made, any press release or public announcement in respect of this
Agreement or the transactions contemplated hereby or otherwise communicate with
any news media in respect of this Agreement or the transactions contemplated
hereby without the prior written consent of the other Party, and the Parties
shall cooperate as to the timing and contents of any such press release or
public announcement.

                   SECTION 5.02   Amendments, Etc.   No amendment or waiver of
any provision of this Agreement, nor consent to any departure by the Issuers or
the Purchaser therefrom, shall in

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any event be effective unless the same shall be in writing and signed by the
other Party, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.

                   SECTION 5.03   Notices.    All notices, requests, claims,
demands and other communications hereunder shall be in writing and shall be
given or made (and shall be deemed to have been duly given or made upon receipt)
by delivery in person, by an internationally recognized overnight courier
service, by telecopy or registered or certified mail (postage prepaid, return
receipt requested) to the respective Parties at the following addresses (or at
such other address for a Party as shall be specified in a notice given in
accordance with this Section 5.03):

  (a) if to either Issuer:

   Corautus Genetics Inc.
430 Tenth Street, NW
Suite S-204
Atlanta, GA 30318
Telecopy: (404) 526-6218
Attention: Chief Executive Officer

  with a copy (which shall not constitute notice) to:

  McKenna Long & Aldridge LLP
303 Peachtree Street, Suite 5300
Atlanta, GA 30308
Telecopy: (404) 527-4198
Attention: Robert E. Tritt

  (b) if to the Purchaser:

  Boston Scientific Corporation
One Boston Scientific Place
Natick, MA 01760-1537
Telecopy: (508) 650-8956
Attention: General Counsel

  with a copy (which shall not constitute notice) to:

  Shearman & Sterling LLP
599 Lexington Ave.
New York, New York 10022-6069
Telecopy: (212) 848-7179
Attention: Clare O’Brien, Esq.

                   Any notice, if mailed and properly addressed with postage
prepaid or if properly addressed and sent by pre-paid courier service, shall be
deemed given when received; any notice, if transmitted by facsimile, shall be
deemed given when the confirmation of transmission thereof is received by the
transmitter.

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                   SECTION 5.04   No Waiver; Remedies.   No failure on the part
of the Purchaser to exercise, and no delay in exercising, any right hereunder or
under this Agreement shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right preclude any other or further exercise
thereof or the exercise of any other right.

                   SECTION 5.05   Treatment of Note.   To the extent permitted
by generally accepted accounting principles, the Issuers will treat, account and
report this Note as debt and not equity for accounting purposes and with respect
to any returns filed with federal, state or local tax authorities.

                   SECTION 5.06   Costs and Expenses. Except as otherwise
specified in this Agreement or a Note, all costs and expenses, including,
without limitation, fees and disbursements of counsel, financial advisors and
accountants, incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the Party incurring such costs and
expenses.

                   SECTION 5.07 Binding Effect.   This Agreement shall become
effective when it shall have been executed by the Parties and thereafter shall
be binding upon and inure to the benefit of the Parties and their respective
successors and assigns, except that the Issuers shall not have the right to
assign its rights hereunder or any interest herein without the prior written
consent of the Purchaser.

                   SECTION 5.08   Survival.   The representations, warranties,
covenants and agreements made herein and in connection with the issuance of any
Note shall survive any investigation made by Purchaser and the closing of the
transactions contemplated hereby.

                   SECTION 5.09   Severability.   If any term or other provision
of this Agreement is invalid, illegal or incapable of being enforced by any Law
or public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect for so long as the economic or
legal substance of the transactions contemplated by this Agreement is not
affected in any manner materially adverse to any party. Upon such determination
that any term or other provision is invalid, illegal or incapable of being
enforced, the Parties shall negotiate in good faith to modify this Agreement so
as to effect the original intent of the Parties as closely as possible in an
acceptable manner in order that the transactions contemplated by this Agreement
are consummated as originally contemplated to the greatest extent possible.

                   SECTION 5.10   Entire Agreement.   The Transaction Documents
constitute the entire agreement of the Parties with respect to the subject
matter hereof and thereof and supersede all prior agreements and undertakings,
both written and oral, among the Parties with respect to the subject matter
hereof and thereof.

                   SECTION 5.11   No Third Party Beneficiaries.   This Agreement
shall be binding upon and inure solely to the benefit of the Parties and their
permitted assigns and nothing herein, express or implied, is intended to or
shall confer upon any other Person any legal or equitable right, benefit or
remedy of any nature whatsoever.

                   SECTION 5.12   Governing Law; Jurisdiction and Enforcement.  
This Agreement shall be governed by the Laws of the State of New York. All
actions and proceedings arising out

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of or relating to this Agreement shall be heard and determined in any New York
state or federal court sitting in the City of New York. The Parties hereto
hereby (a) submit to the exclusive jurisdiction of any state or federal court
sitting in The City of New York for the purpose of any action arising out of or
relating to this Agreement brought by any Party hereto and (b) irrevocably
waive, and agree not to assert by way of motion, defense, or otherwise in any
such action, any claim that it is not subject personally to the jurisdiction of
the above-named courts, that its property is exempt or immune from attachment or
execution, that the action is brought in an inconvenient forum, that the venue
of the action is improper, or that this Agreement may not be enforced in or by
any of the above-named courts.

                   SECTION 5.13   Dispute Resolution.   Except to the limited
extent necessary to obtain interim relief, including injunctive relief, to
preserve the status quo or prevent irreparable harm, neither Party shall file an
action or institute legal proceedings with respect to any dispute, controversy,
or claim arising out of this Agreement or the validity, interpretation, breach
or termination thereof, including claims seeking redress or asserting rights
under any Law, until:

           (i)         the aggrieved Party has given the other Party written
notice (“Notice of Disagreement”), in accordance with Section 5.03 of this
Agreement, of its grievance setting forth the basis for such dispute and the
remedy desired;

           (ii)         the other Party has failed to provide a prompt and
effective remedy (in the view of the aggrieved Party);

           (iii)         the aggrieved Party has requested in writing senior
executives for both Parties to promptly meet and discuss the matter detailed in
the Notice of Disagreement in order to consider informal and amicable means of
resolution; and

           (iv)         (a)   the senior executives for both Parties have met at
least three times and have not been able to resolve the dispute to the mutual
satisfaction of the Parties or (b) more than sixty (60) business days have
passed since the date of the Notice of Disagreement.

                   SECTION 5.14   Counterparts.   This Agreement may be executed
and delivered (including by facsimile transmission) in one or more counterparts,
and by the different Parties in separate counterparts, each of which when
executed shall be deemed to be an original, but all of which taken together
shall constitute one and the same agreement. Delivery of an executed counterpart
of a signature page to this Agreement by facsimile shall be effective as
delivery of a manually executed counterpart of this Agreement.

                   SECTION 5.15   Waiver of Jury Trial.   The Parties hereby
knowingly, voluntarily and irrevocably waive all right to trial by jury in any
action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to this Agreement or any course of
conduct, course of dealing or statements (whether oral or written) or actions of
the Purchaser in the negotiation, administration, performance or enforcement
thereof.

[Signature Page Follows]

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                   IN WITNESS WHEREOF, the Parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.

      CORAUTUS GENETICS INC.     as Issuer             By: /s/ RICHARD E. OTTO  
   

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    Title: Chief Executive Officer             VASCULAR GENETICS INC.     as
Issuer             By: /s/ RICHARD E. OTTO      

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    Title: Chief Executive Officer                     BOSTON SCIENTIFIC
CORPORATION     as Purchaser             By: /s/ LAWRENCE C. BEST      

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    Title: Senior Vice President &       Chief Financial Officer  

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EXHIBIT A

FORM OF SENIOR CONVERTIBLE PROMISSORY NOTE

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EXHIBIT B

FORM OF NOTICE OF BORROWING

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EXHIBIT C

FORM OF OPINION OF COUNSEL TO THE COMPANY