Amendment to Employment Agreement



 EXHIBIT 10.3 
 FIRST AMENDMENT TO EMPLOYMENT AGREEMENT 
 BETWEEN MICHAEL K. STEELE AND CORAUTUS GENETICS, INC.

 This FIRST AMENDMENT to that certain EMPLOYMENT AGREEMENT between Corautus Genetics, Inc. (the “Company”) and Michael K.
Steele (the “Executive”), originally effective as of May 1, 2005 and as renewed effective May 1, 2006 (the “Agreement”), is hereby entered into by and between the Company and the Executive effective as of the 15th day of May,
2006. 
 W I T N E S S E T H: 
 WHEREAS, the Company and the Executive are parties to the Agreement; and 
 WHEREAS, due to the precipitous drop in
the value of the stock of the Company following the termination of the enrollment of patients in the GENASIS Phase IIb Clinical Trial in April 2006, the Company has deemed it necessary to provide the Executive with incentives to continue in the
employ of the Company; and 
 WHEREAS, the Board of Directors of the Company approved this amendment to the Agreement to include
certain retention incentives to encourage the Executive to continue his employment with the Company, to increase the likelihood of retaining the Executive and to create stability within the Company; 
 NOW, THEREFORE, effective as of May 15, 2006, the parties hereby amend the Agreement as follows: 
 1. A new Article 7 shall be added to the Agreement to read as follows: 
 “ARTICLE 7 
 RETENTION INCENTIVES 
 7.1 Cash Retention Payment. The Executive shall be entitled to receive a lump sum cash payment of $25,000 if he is employed by the Company
on September 30, 2006. The Executive shall be entitled to receive an additional lump sum cash payment of $25,000 if he is employed by the Company on March 31, 2007. If the Executive is employed on the date(s) provided herein, the cash
payment(s) shall be paid to the Executive no later than the next regularly scheduled payroll date following the date the Executive becomes entitled to such payment. 
 7.2 Nonqualified Stock Option Award. In accordance with and subject to the terms of the Corautus Genetics Inc. 2002 Stock Plan (the “Plan”), the Company agrees to grant to the Executive
nonqualified stock options to purchase 60,000 shares of the Company’s 








 
common stock according to the following terms and conditions (any additional terms and conditions of such option grant to be as specified in the option
agreement): 
 (a) The date of grant shall be the effective date of this First Amendment to the Agreement; 
 (b) The per share option exercise price shall be the fair market value per share (as defined in the Plan) on the date of grant; 
 (c) The options shall become exercisable as follows: 
 (i) 30,000 of the option shares shall become exercisable on March 31, 2007 if the Executive is employed by the Company on that date; and 
 (ii) The remaining 30,000 option shares shall become exercisable on March 31, 2008 if the Executive is employed by the Company on that date. 
 (d) The options shall have a 10-year term and, except as specified herein, shall be subject to the terms and provisions of the Plan; and 
 (e) Once exercisable, the options shall remain exercisable following termination of employment only as provided under the terms of the Plan.”

 2. Except as specifically provided above, the terms of the Agreement shall remain in full force and effect as prior to this First Amendment. 

IN WITNESS WHEREOF, the Executive and the Company have executed and delivered this First Amendment to the Agreement as of the date set forth
above, but actually on the date set forth below. 
  

			
	CORAUTUS GENETICS, INC.
		
	By:	 	 /s/ Richard E. Otto

		 	Richard E. Otto
		 	President and CEO
		
	Date:	 	May 15, 2006
	
	MICHAEL K. STEELE
	
	 /s/ Michael K. Steele

		
	Date:	 	May 15, 2006