8-K

United States
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): June 29, 2006

OXiGENE, INC.

(Exact name of registrant as specified in its charter)

Delaware
(State or other
jurisdiction of
incorporation) 0-21990
(Commission File
Number) 13-3679168
(I.R.S. Employer
Identification No.)

230 Third Avenue, Waltham, MA 02451

(Address of principal executive offices)

Registrant’s telephone number, including area code: (781) 547-5900

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the obligation of the registrant under any of the following provisions:

o Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

	ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
	ITEM 5.02 DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS.
	ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
SIGNATURE
EXHIBITS
EX-10.1 Dr. Chin Employment Agreement, dated 6/29/06
EX-10.2 Mr. Driscoll Separation Agreement, dated 6/29/06
EX-99.1 Press Release, dated 6/30/06

ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.

The disclosure provided under Item 5.02(c) below is incorporated herein by reference.

ITEM 5.02 DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS.

(a) Not applicable.

(b) The disclosure provided under Item 5.02(c) below is incorporated herein by reference.

(c) On June 30, 2006, OXiGENE, Inc. (“OXiGENE” or the “Company”) announced that Richard Chin, M.D. will replace Frederick Driscoll as the Company’s President and Chief Executive Officer.

Prior to joining OXiGENE, Dr. Chin, age 39, a current member of the Company’s Board of Directors (the “Board”), had served as Senior Vice President and Head of Global Development for Elan Corporation, plc since May 2005 and served as Senior Vice President and Head of Global Medical Affairs of Elan from June 2004 until May 2005. As Senior Vice President and Head of Global Development for Elan Corporation, Dr. Chin had worldwide responsibility for clinical development, regulatory, biostatistics, CMC, QA/compliance, safety and medical affairs. Dr. Chin served in various clinical and scientific roles of increasing responsibility for Genentech, Inc. from March 1999 until June 2004, and ultimately served as Genentech’s Group Director and Head of Clinical Research, Biotherapeutics Unit.

Dr. Chin began his career in pharmaceuticals in July 1997 at Procter and Gamble Pharmaceuticals where he served as Associate Medical Director. Dr. Chin holds a Medical Degree from Harvard Medical School. He received a Masters degree and Bachelor of Arts degree in Law with honors from Oxford University, England under a Rhodes Scholarship. He graduated with a Bachelor of Arts in Biology, magna cum laude, from Harvard University. Dr. Chin is a Diplomate, American Board of Internal Medicine and is licensed to practice medicine in California. Dr. Chin currently serves on the Scientific Advisory Board of Genmedica, located in Barcelona, Spain.

OXiGENE has entered into an employment agreement with Dr. Chin with respect to his service as its President and Chief Executive Officer. Pursuant to the agreement, Dr. Chin will initially receive an annual base salary of $380,000 per year. In addition, Dr. Chin may be eligible to earn an annual bonus based on achievement of individual and Company written goals established on an annual basis by the Board. If Dr. Chin meets the applicable goals, than he shall be entitled to a minimum bonus for that year equal to 50% of his then-current base salary. The Board may also, in its discretion, choose to award Dr. Chin a bonus of up to 100% of his then-current base salary. Dr. Chin shall be eligible for a pro-rated bonus for the 2006 fiscal year. At least 50% of the annual bonus awarded and paid in any year other than 2007 shall be comprised of restricted stock grants or other forms of equity, the amount of which shall be determined by dividing the amount of Dr. Chin’s annual bonus for that year by the Company’s closing stock price on the date of grant. Dr. Chin may elect to receive a greater percentage of his annual bonus in the form of equity, subject to the approval of the Board; provided that the annual bonus awarded and paid in 2007, if any, shall be comprised entirely of cash. Dr. Chin will also receive a commencement bonus in the amount of $200,000.

OXiGENE will grant to Dr. Chin, pursuant to the OXiGENE, Inc. 2005 Stock Plan, an option to purchase 250,000 shares of the Company’s common stock at an exercise price equal to the fair market value on the date of grant of such option. The option shall vest in equal annual installments over four years beginning on the first anniversary of the grant. On January 2, 2007, the Company will also grant to Dr. Chin 250,000 shares of restricted common stock, which restricted stock shall vest in annual increments over the four year period

measured from the commencement date of Dr. Chin’s employment with the Company, with vesting to begin on the first anniversary of the commencement date. On an annual basis beginning in 2007, the Board, in its discretion, shall grant to Dr. Chin additional options or restricted common stock, with a target of approximately 100,000 shares of common stock per year; provided that, in 2007 only, the Board shall consider a cash award to Dr. Chin of $250,000 to $350,000 in lieu of any award of options or restricted stock. The award and amount of such grants (or cash payment) shall be based on performance and shall be awarded at the sole discretion of the Board. The Company shall reimburse Dr. Chin for up to $100,000 in relocation expenses. In addition, for as long as Dr. Chin remains OXiGENE’s Chief Executive Officer, the Nominating Committee of the Board will nominate him for continuing membership on the Board.

OXiGENE may terminate the employment agreement without prior written notice, and Dr. Chin may terminate the agreement on 30 days’ prior written notice, as described in the agreement. OXiGENE may also terminate the agreement without prior written notice for “cause,” as defined in the agreement, as long as, in certain circumstances, it gives Dr. Chin a minimum period of 30 days to cure the act or omission constituting cause, as described in the agreement. Upon termination of Dr. Chin’s employment for any reason, if so requested by the Chairman of the Board or a majority of the members of the Board, Dr. Chin shall immediately resign as a director of the Company. If Dr. Chin’s employment is terminated by OXiGENE for cause, or by Dr. Chin without good reason, or as a result of Dr. Chin’s death, OXiGENE will pay to Dr. Chin the amount of accrued obligations to Dr. Chin as of the date of such termination, consisting of accrued and unpaid salary, value of accrued vacation days, amount of unreimbursed and incurred expenses, Dr. Chin’s unvested equity compensation already granted and earned as part of his bonus in the previous year(s), which shall immediately vest and become exercisable upon termination, and the annual bonus related to the most recently completed calendar year, if not already paid . If Dr. Chin’s employment is terminated by OXiGENE as a result of Dr. Chin’s disability, OXiGENE will pay to Dr. Chin the accrued obligations, as described above, plus an amount equal to two months of Dr. Chin’s then-current base salary.

If Dr. Chin’s employment is terminated by OXiGENE without cause, or by Dr. Chin with good reason, OXiGENE will pay to Dr. Chin the accrued obligations, as described above, and an amount equal to 24 months of his then-current base salary, and will also continue to provide medical insurance coverage to Dr. Chin and his family at no cost for 18 months, as described in the agreement. If Dr. Chin’s employment is terminated by OXiGENE without cause, or by Dr. Chin with good reason, within 12 months following a change in control of the Company, as defined in the agreement, OXiGENE will pay to Dr. Chin the accrued obligations, as described above, and an amount equal to 24 months of his then-current base salary, and will also continue to provide medical insurance coverage to Dr. Chin and his family at no cost for 18 months, as described in the agreement. In addition, all unvested options and restricted shares then held by Dr. Chin shall vest and be immediately exercisable.

Subject to OXiGENE’s policy regarding black-out periods and any applicable securities laws, within three months after payment to Dr. Chin of the commencement bonus, Dr. Chin has agreed to purchase, in the open market, $250,000 worth of OXiGENE’s common stock.

OXiGENE has also entered into a Confidentiality, Noncompetition and Intellectual Property Agreement with Dr. Chin.

The Company has also entered into a separation agreement with Mr. Driscoll. Pursuant to the separation agreement, Mr. Driscoll’s employment with OXiGENE ended on June 29, 2006, and he resigned from OXiGENE’s Board effective June 29, 2006. Mr. Driscoll shall receive a severance payment of $325,000, and will have the right to continue his medical and dental insurance, as described in the agreement. OXiGENE has accelerated the vesting of 80,000 shares of restricted stock granted to Mr. Driscoll on October 3, 2005 so that the restrictions on such shares lapsed on June 29, 2006. Mr. Driscoll will have until December 31, 2006 to

exercise any vested options to purchase OXiGENE common stock, subject to any provisions of the applicable stock plan that would extend the exercise period for such options beyond December 31, 2006. All unvested options terminated on June 29, 2006.

(d) Not applicable.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

(d) Exhibits:

Exhibit Number	Description
10.1	Employment Agreement between OXiGENE and Dr. Chin dated June 29, 2006.
10.2	Separation Agreement between OXiGENE and Mr. Driscoll dated June 29, 2006.
99.1	Press Release dated June 30, 2006, reporting appointment of Dr. Chin as President and Chief Executive Officer of OXiGENE.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: July 6, 2006	OXiGENE, Inc.
	/s/ James B. Murphy
	By: James B. Murphy
	Vice President and Chief Financial Officer

EXHIBITS

Exhibit Number	Description
10.1	Employment Agreement between OXiGENE and Dr. Chin dated June 29, 2006.
10.2	Separation Agreement between OXiGENE and Mr. Driscoll dated June 29, 2006.
99.1	Press Release dated June 30, 2006, reporting appointment of Dr. Chin as President and Chief Executive Officer of OXiGENE.

EX-10.1

Exhibit 10.1

EMPLOYMENT AGREEMENT

     This Employment Agreement, dated as of June 29, 2006 (the “Agreement”), is between OXiGENE, Inc. (the “Company”), and Richard Chin (“Executive”). This Agreement is intended to confirm the understanding and set forth the agreement between the Company and Executive with respect to Executive’s future employment by the Company. In consideration of the mutual promises and covenants contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby mutually acknowledged, the parties agree as follows:

        1.      Employment.

      (a)      Title and Duties. Subject to the terms and conditions of this Agreement, the Company will employ Executive, and Executive will be employed by the Company, as President and Chief Executive Officer (“CEO”), reporting to the Board of Directors of the Company (the “Board”). Executive will have the responsibilities, duties and authority commensurate with said position. Executive will also perform such other services of an executive nature for the Company as may be reasonably assigned to Executive from time to time by the Board.

      (b)      Devotion to Duties. For so long as Executive is employed hereunder, Executive will devote substantially all of Executive’s business time and energies to the business and affairs of the Company, provided that nothing contained in this Section 1(b) will be deemed to prevent or limit Executive’s right to manage Executive’s personal investments on Executive’s own personal time, including, without limitation, the right to make passive investments in the securities of (i) any entity which Executive does not control, directly or indirectly, and which does not compete with the Company, or (ii) any publicly held entity (other than the Company or its related entities) so long as Executive’s aggregate direct and indirect interest does not exceed two percent (2%) of the issued and outstanding securities of any class of securities of such publicly held entity. Except as set forth on Exhibit A hereto, Executive represents that Executive is not currently a director (or similar position) of any other entity and is not employed by or providing consulting services to any other person or entity, and Executive agrees to refrain from undertaking any such position or engagement without the prior written approval of the Board. Executive may continue to serve as a director and/or volunteer for the entities listed on Exhibit A provided that such service does not create any conflicts, ethical or otherwise, with Executive’s responsibilities to the Company and further provided that Executive’s time commitments do not unreasonably interfere with his fulfillment of his responsibilities hereunder, as determined by the Board or its designated committee thereof.

      (c)      Board Membership. For as long as the Executive is the CEO, the Nominating Committee of the Board will nominate Executive for continuing membership on the Board. The restricted stock already granted to Executive as a board member will continue to vest according to the terms and conditions set forth in the applicable stock plan and restricted stock agreements.

         2.      Term of Employment.

      (a)      Term. The Executive’s employment by the Company under this Agreement shall commence seven (7) days after full execution of this Agreement by the Executive and the Company (the “Commencement Date”). The Executive is employed on an at-will basis and, subject to the provisions of Section 4, either the Executive or the Company may terminate the employment relationship at any time for any reason. The duration of Executive’s employment is hereafter referred to as the “Term.”

      (b)      Termination. Notwithstanding anything else contained in this Agreement, Executive’s employment hereunder will terminate upon the earliest to occur of the following:

(i)      Death. Immediately upon Executive’s death;

(ii)     Termination by the Company.

      (A)      If because of Disability (as defined below), then upon written notice by the Company to Executive that Executive’s employment is being terminated as a result of Executive’s Disability, which termination shall be effective on the date of such notice;

      (B)      If for Cause, then upon written notice by the Company to Executive that states that Executive’s employment is being terminated for Cause (as defined below) and sets forth the specific alleged Cause for termination and the factual basis supporting the alleged Cause, which termination shall be effective on the date of such notice or such later date as specified in writing by the Board; provided that if such Cause arises under Section 2(d)(i), (ii), (iii), (vii) or (viii), the Executive shall be given a minimum period of thirty (30) days to reasonably cure such Cause; or

      (C)      If without Cause (i.e., for reasons other than Sections 2(b)(ii)(A) or (B)), then upon written notice by the Company to Executive that Executive’s employment is being terminated without Cause, which termination shall be effective on the date of such notice or such later date as specified in writing by the Board; or

(iii)    Termination by Executive.

      (A)      If for Good Reason (as defined below), then upon written notice by Executive to the Company that states that Executive is terminating Executive’s employment for Good Reason (as defined below) and that sets forth the specific alleged Good Reason for termination and the factual basis supporting the alleged Good Reason, which termination shall be effective thirty (30) days after the date of such notice; provided that if the Company has reasonably cured the circumstances giving rise to the Good Reason by such date, then such termination shall not be effective; or

      (B)      If without Good Reason, then upon written notice by Executive to the Company that Executive is terminating Executive’s employment, which termination shall be effective thirty (30) days after the date of such notice; provided that the Executive may request at such time to leave with a shorter notice period, and the Board shall not unreasonably withhold its consent to such shorter period.

      Notwithstanding anything in this Section 2(b), the Company may at any point terminate Executive’s employment for Cause prior to the effective date of any other termination contemplated hereunder if such Cause exists.

      (c)      Definition of “Disability”. For purposes of this Agreement, “Disability” shall mean Executive’s inability to further perform Executive’s duties and responsibilities as contemplated herein because Executive’s physical or mental health has become so impaired as to make such performance impossible or impractical, which inability continues for one hundred twenty (120) days or more within any twelve (12) month period (either consecutively or cumulatively). Determination of Executive’s physical or mental health will be determined by a medical expert appointed by mutual agreement between the Company and Executive.

      (d)      Definition of “Cause”. For purposes of this Agreement, “Cause” shall mean that Executive has (i) intentionally committed an act or omission that materially harms the Company; (ii) been grossly negligent in the performance of Executive’s duties to the Company; (iii) willfully failed or refused to follow the lawful and proper directives of the Board, which failure or refusal continues despite Executive having

received an opportunity to cure pursuant to Section 2(b)(ii)(B) of this Agreement; (iv) been convicted of, or pleaded guilty or nolo contendre, to a felony; (v) committed a criminal act involving moral turpitude, but excluding any conviction which results solely from Executive’s title or position with the Company and is not based on his personal conduct; (vi) committed an act relating to the Executive’s employment or the Company involving, in the good faith judgment of the Board, material fraud or theft; (vii) breached any material provision of this Agreement or any nondisclosure or non-competition agreement (including the Confidentiality, Non-Competition and Intellectual Property Agreement attached here as Exhibit B), between Executive and the Company, as all of the foregoing may be amended prospectively from time to time; or (viii) intentionally breached a material provision of any code of conduct or ethics policy in effect at the Company, as all of the foregoing may be amended prospectively from time to time.

      (e)      Definition of “Good Reason”. For the purposes of this Agreement, “Good Reason” shall mean: (i) without the Executive’s express written consent, any material reduction in Executive’s title, or responsibilities compared to those prior to the Change in Control; (ii) without the Executive’s express written consent, a material reduction by the Company in the Executive’s total compensation as in effect on the date hereof or as the same may be increased from time to time, provided that it shall not be deemed a material reduction if (X) the amount of Executive’s Annual Bonus is less than the amount of any previously awarded Annual Bonuses or (Y) a benefit is amended and such amendment affects all eligible executive participants; or (iii) the Company breaches a material term of this Agreement; provided that failure to timely make any payments within the time frames set forth in this Agreement shall not be considered Good Reason if such payment is provided within the cure period set forth in Section 2(b)(iii)(A).

      (f)      Definition of “Change in Control”. “Change in Control” of OXiGENE, Inc. as used in this Agreement shall mean the following, but only to the extent it is interpreted in a manner consistent with the meaning of “a change in the ownership or effective control of the corporation, or in the ownership of a substantial portion of the assets of the corporation” under Section 409A of Internal Revenue Code of 1986, as amended (“Code Section 409A”), and any successor statute, regulation and guidance thereto, and limited to the extent necessary so that it will not cause adverse tax consequences with respect to Code Section 409A: (i) a merger or consolidation of the Company whether or not approved by the Board of Directors, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or the parent of such corporation) at least 50% of the total voting power represented by the voting securities of the Company or such surviving entity or parent of such corporation, as the case may be, outstanding immediately after such merger or consolidation; or (ii) the stockholders of the Company approve an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.

      (g)      Board Membership. Upon termination of Executive’s employment for any reason, if so requested by the Chairman of the Board or a majority of the Board, Executive shall immediately resign in writing as a director of the Company.

        3.      Compensation.

      (a)      Base Salary. While Executive is employed hereunder, the Company will pay Executive a base salary at the gross annualized rate of $380,000.00 (the “Base Salary”), paid in accordance with the Company’s usual payroll practices. The Base Salary will be subject to review annually or on such periodic basis (not to exceed annually) as the Company reviews the compensation of the Company’s other senior executives and may be adjusted upwards in the sole discretion of the Board or its designee. The Company will deduct from each such installment any amounts required to be deducted or withheld under applicable law or under any employee benefit plan in which Executive participates.

      (b)      Annual Bonus. Executive may be eligible to earn an Annual Bonus relating to each fiscal year, based on the achievement of individual and Company written goals established on an annual basis by the Board within thirty (30) days of the beginning of the fiscal year. Executive shall be eligible for a pro-rated bonus for 2006. If the Executive meets the applicable goals, then the Executive shall be entitled to a minimum bonus for that year equal to 50% of his then-current Base Salary. The Board may in its discretion award the Executive a more generous bonus, up to 100% of his then-current Base Salary. At least 50% of the Annual Bonus awarded and paid in any year other than 2007 shall be comprised of restricted stock grants or other forms of equity, the amount of which shall be determined by dividing the Annual Bonus by the closing stock price on the date of grant. The Executive may elect to receive a greater percentage of the Annual Bonus in the form of equity, subject to the approval of the Board; provided that the Annual Bonus awarded and paid in 2007, if any, shall be comprised entirely of cash. Any Annual Bonus shall be paid as soon as practicable following the close of the fiscal year, but in any event no later than the time by which the Company is required to file its Annual Report on Form 10-K.

      (c)      Commencement Bonus. The Company will pay Executive a Commencement Bonus of $200,000, less applicable taxes and deductions. The Commencement Bonus will be paid no later than sixty (60) days after the Commencement Date. If Executive’s employment hereunder is terminated either by the Company for Cause or voluntarily by Executive in the absence of a Good Reason within one (1) year of the Commencement Date, Executive will promptly repay a portion of the Commencement Bonus equal to the amount of the Commencement Bonus, net of applicable taxes and deductions, multiplied by a fraction, the numerator of which equals the number of days from the effective date of such termination to the first anniversary of the Commencement Date and the denominator of which will be 365 (or the Company may withhold such amount from any payments otherwise due to Executive).

      (d)      Equity Compensation.

      (i)      The Company will grant to Executive as of the Commencement Date options to purchase 250,000 shares of the Company’s common stock at an exercise price equal to the fair market value of such stock on the date of grant, which options will vest in annual increments over the four (4) year period following the date of grant, with vesting to begin on the one (1) year anniversary of the grant date. To the extent allowed by law, the options shall be treated as incentive options.

      (ii)     On January 2, 2007, the Company will grant to Executive 250,000 shares of restricted common stock, which restricted stock shall vest in annual increments over the four (4) year period measured from the Commencement Date, with vesting to begin on the one (1) year anniversary of the Commencement Date.

      (iii)    On an annual basis beginning in 2007, the Board, in its discretion, shall grant to Executive additional options or restricted common stock, with a target of approximately 100,000 shares of common stock per year; provided that, in 2007 only, the Company shall consider a cash award of $250,000 to $350,000 in lieu of any award of options or restricted stock. The award and amount of such grants (or cash payment) shall be based on performance and shall be awarded at the sole discretion of the Board.

      (iv)     The number of options or shares of restricted stock contemplated in this Agreement but not yet granted shall be proportionately adjusted for any increase or decrease in the number of issued shares of common stock of the Company resulting from a stock split, reverse stock split, combination or reclassification of such common stock.

      (v)      Except as otherwise expressly provided in this Agreement, any options or shares of restricted stock granted to Executive shall be subject to the terms and conditions set forth in the

agreements entered into by Executive and the Company governing such options or stock grants and the OXiGENE, Inc. 2005 Stock Plan (“Stock Plan”) or any successor or replacement plan thereto.

      (e)      Fringe Benefits. In addition to any benefits provided by this Agreement, Executive shall be entitled to participate in all employee benefit, welfare and other plans, practices, policies and programs and fringe benefits maintained by the Company from time to time on a basis no less favorable than those provided to other similarly situated executives of the Company. Executive understands that, except when prohibited by applicable law, the Company’s benefit plans and fringe benefits may be amended, enlarged, diminished or terminated prospectively by the Company from time to time, in its sole discretion, and that such shall not be deemed to be a breach of this Agreement or a material change in the terms of Executive’s compensation for the purposes of Section 2(e), provided that Executive’s level of coverage under all such programs is at least as great as is such coverage provided to similarly situated executives of the Company.

      (f)      Vacation. Executive will be entitled to accrue up to twenty (20) vacation days per year that Executive remains employed by the Company, administered in accordance with and subject to the terms of the Company’s vacation policy, as it may be amended prospectively from time to time.

      (g)      Reimbursement of Expenses. The Company will promptly reimburse Executive for all ordinary and reasonable out-of-pocket business expenses that are incurred by Executive in furtherance of the Company’s business in accordance with the Company’s policies with respect thereto as in effect from time to time.

      (h)      Relocation. As a condition of his employment hereunder, Executive is expected to relocate to a reasonable commuting distance from the Company’s current headquarters if the Board and the Executive reasonably deem such relocation to be necessary to meet business needs; provided that the Executive shall not unreasonably withhold his consent to such relocation. The Board shall notify the Executive of the date by which such relocation must be effectuated, which date shall be not less than ninety (90) days after the date of such notice. The Company shall reimburse Executive for up to $100,000 in Relocation Expenses (as defined below) relating to such relocation, so long as the Executive is employed by the Company at the time of the relocation. Such reimbursement shall be promptly made upon presentation of reasonably detailed documentation of such Relocation Expenses. For purposes hereof, “Relocation Expenses” shall mean reasonable expenses incurred by Executive related to costs of looking for a new primary residence, costs associated with the sale of Executive’s California residence and the purchase of Executive’s new residence (but excluding taxes or the actual purchase price of such residence), and the physical movement of all goods and vehicles that are in Executive’s California home. The foregoing notwithstanding, if within one (1) year of the Commencement Date, Executive’s employment with the Company is terminated either by the Company for Cause or voluntarily by Executive in the absence of a Good Reason, then Executive shall repay to the Company, within three (3) months of termination, the amount of the actually-reimbursed Relocation Expenses multiplied by a fraction, the numerator of which equals the number of days from the effective date of such termination to the first anniversary of Executive’s Commencement Date and the denominator of which will be 365 (and the Company may withhold such amount from any payments otherwise due to Executive).

      To the extent permitted by law, commuting expenses, including travel, lodging, and associated costs prior to relocation shall be treated and reimbursed as a business expense, and such expenses shall not be considered Relocation Expenses.

        4.      Compensation Upon Termination.

      (a)      Definition of Accrued Obligations. For purposes of this Agreement, “Accrued Obligations” means (i) the portion of Executive’s Base Salary that has accrued prior to any termination of Executive’s employment with the Company and has not yet been paid; (ii) to the extent required by law and the

Company’s policy, an amount equal to the value of Executive’s accrued but unused vacation days; (iii) the amount of any expenses properly incurred by Executive on behalf of the Company prior to any such termination and not yet reimbursed; (iv) the Executive’s unvested equity compensation already granted and earned as part of Executive’s bonus in the previous year(s), which shall immediately vest and become exercisable upon termination; and (v) the Annual Bonus related to the most recently completed calendar year, if not already paid (the amount of which shall be determined in accordance with Section 3(b) above). Executive’s entitlement to any other compensation or benefit under any plan or policy of the Company, including but not limited to applicable option plans, shall be governed by and determined in accordance with the terms of such plans or policies, except as otherwise specified in this Agreement.

      (b)      Termination for Cause, By the Executive Without Good Reason, or as a Result of Executive’s Disability or Death.

      (i)      If Executive’s employment hereunder is terminated either by the Company for Cause, or by Executive without Good Reason, or if Executive’s employment terminates as a result of the Executive’s death, the Company will pay the Accrued Obligations to Executive promptly following the effective date of such termination.

      (ii)     In case of termination by the Company as a result of the Executive’s Disability, the Company will pay Executive the Accrued Obligations plus an amount equal to two (2) months of Executive’s then-current Base Salary.

      (c)      Termination By the Company Without Cause or By Executive With Good Reason. If Executive’s employment hereunder is terminated by the Company without Cause or by Executive with Good Reason, then:

      (i)      The Company will pay the Accrued Obligations to Executive promptly following the effective date of such termination;

      (ii)     The Company will pay Executive a total amount equal to twenty-four (24) months of Executive’s then current Base Salary, less applicable taxes and deductions; such payment to be held in escrow in an interest bearing account designated for Executive subject to the terms of the Separation Agreement set forth in Section 4(e) below, and to be made in twelve (12) approximately equal monthly installments in accordance with the Company’s usual payroll practices over a period of twelve (12) months; and

      (iii)    The Company will continue to provide medical insurance coverage for Executive and Executive’s family at no cost to Executive for eighteen (18) months; provided, that the Company shall have no obligation to provide such coverage if Executive fails to elect COBRA benefits in a timely fashion or if Executive becomes eligible for medical coverage with another employer.

      (d)      Termination Following A Change In Control Without Cause or for Good Reason. If Executive’s employment is terminated within the twelve (12) month period following a Change in Control by the Company without Cause or by the Executive for Good Reason, then:

      (i)      the Executive shall be entitled to receive the payments and benefits set forth in Section 4(c) above; and

      (ii)     all unvested options and restricted shares then held by Executive shall vest and be immediately exercisable.

      (e)      Release of Claims/Board Resignation. The Company shall not be obligated to pay Executive any of the compensation or provide Executive any of the benefits or equity acceleration set forth in Section

4(b), 4(c) or 4(d) (other than the Accrued Obligations) unless and until Executive has (i) executed a timely separation agreement in a form acceptable to the Company, which shall include a releases of claims between the Company and the Executive, including provisions regarding mutual non-disparagement and confidentiality; and (ii) resigned from the Board, if so requested pursuant to Section 2(g).

      (f)      No Other Payments or Benefits Owing. The payments and benefits set forth in this Section 4 shall be the sole amounts owing to Executive as separation pay upon termination of Executive’s employment. Executive shall not be eligible for any other payments, including but not limited to additional Base Salary payments, bonuses, commissions, or other forms of compensation or benefits, except as may otherwise be set forth in this Agreement or other Company plan documents with respect to plans in which Executive is a participant.

      (g)      Notwithstanding any other provision with respect to the timing of payments under Section 4, if, at the time of Executive’s termination, Executive is deemed to be a “specified employee” (within the meaning of Code Section 409A, and any successor statute, regulation and guidance thereto) of the Company, then limited only to the extent necessary to comply with the requirements of Code Section 409A, any payments to which Executive may become entitled under Section 4 which are subject to Code Section 409A (and not otherwise exempt from its application) will be withheld until the first (1^st) business day of the seventh (7^th) month following the termination of Executive’s employment, at which time Executive shall be paid an aggregate amount equal to the accumulated, but unpaid, payments otherwise due to Executive under the terms of Section 4.

        5.      Confidentiality and Competition. Executive agrees to sign and return to the Company the Confidentiality, Non-Competition and Intellectual Property Agreement attached hereto as Exhibit B concurrently with the execution of this Agreement.

        6.      Property and Records. Upon termination of Executive’s employment hereunder for any reason or for no reason, Executive will deliver to the Company any property of the Company which may be in Executive’s possession, including blackberry-type devices, laptops, cell phones, products, materials, memoranda, notes, records, reports or other documents or photocopies of the same.

        7.      Stock Purchase. Subject to the Company’s policy regarding black-out periods and any applicable securities laws, within three (3) months after payment of the Commencement Bonus, Executive agrees to purchase in the open-market $250,000 worth of the common stock of the Company; provided that if the Company’s policy or applicable law would prohibit Executive from purchasing stock during such period, then Executive shall purchase such stock at the earliest possible time consistent with Company policy and applicable law.

        8.      General.

      (a)      Notices. Except as otherwise specifically provided herein, any notice required or permitted by this Agreement shall be in writing and shall be delivered as follows with notice deemed given as indicated: (i) by personal delivery when delivered personally; (ii) by overnight courier upon written verification of receipt; (iii) by telecopy or facsimile transmission upon acknowledgment of receipt of electronic transmission; or (iv) by certified or registered mail, return receipt requested, upon verification of receipt. Notices to Executive shall be sent to the last known address in the Company’s records or such other address as Executive may specify in writing. Notices to the Company shall be sent to the Company’s Chairman or to such other Company representative as the Company may specify in writing.

      (b)      Entire Agreement/Modification. This Agreement, together with the Confidentiality, Non-Competition and Intellectual Property Agreement attached hereto and the other agreements specifically referred to herein, embodies the entire agreement and understanding between the parties hereto and supersedes all prior oral or written agreements and understandings relating to the subject matter hereof. No

statement, representation, warranty, covenant or agreement of any kind not expressly set forth in this Agreement (or in a subsequent written modification or amendment executed by the parties hereto) will affect, or be used to interpret, change or restrict, the express terms and provisions of this Agreement.

      (c)      Waivers and Consents. The terms and provisions of this Agreement may be waived, or consent for the departure therefrom granted, only by written document executed by the party entitled to the benefits of such terms or provisions. No such waiver or consent will be deemed to be or will constitute a waiver or consent with respect to any other terms or provisions of this Agreement, whether or not similar. Each such waiver or consent will be effective only in the specific instance and for the purpose for which it was given, and will not constitute a continuing waiver or consent.

      (d)      Assignment and Binding Effect. The Company may assign its rights and obligations hereunder to any person or entity that succeeds to all or substantially all of the Company’s business or that aspect of the Company’s business in which Executive is principally involved. Executive may not assign Executive’s rights and obligations under this Agreement without the prior written consent of the Company. This Agreement shall be binding upon Executive, Executive’s heirs, executors and administrators and the Company, and its successors and assigns, and shall inure to the benefit of Executive, Executive’s heirs, executors and administrators and the Company, and its successors and assigns.

      (e)      Indemnification. Executive shall be entitled to the same rights to indemnification and coverage under the Company’s Directors and Officers Liability Insurance policies as they may exist from time to time to the same extent as other officers and directors of the Company.

      (f)      Governing Law. This Agreement and the rights and obligations of the parties hereunder will be construed in accordance with and governed by the law of the Commonwealth of Massachusetts, without giving effect to conflict of law principles.

      (g)      Severability. The parties intend this Agreement to be enforced as written. However, should any provisions of this Agreement be held by a court of law to be illegal, invalid or unenforceable, the legality, validity and enforceability of the remaining provisions of this Agreement shall not be affected or impaired thereby.

      (h)      Headings and Captions. The headings and captions of the various subdivisions of this Agreement are for convenience of reference only and will in no way modify or affect the meaning or construction of any of the terms or provisions hereof.

        9.      Taxation. The parties intend this Agreement to be in compliance with Code Section 409A. The Executive acknowledges and agrees that the Company does not guarantee the tax treatment or tax consequences associated with any payment or benefit arising under this Agreement, including but not limited to consequences related to Code Section 409A. The Company and Executive agree that both will negotiate in good faith and jointly execute an amendment to modify this Agreement to the extent necessary to comply with the requirements of Code Section 409A.

     If any payment to the Executive by the Company, whether or not under this Agreement (“Payment”), becomes subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), the Company shall, as soon as reasonably practicable after written notice thereof to the Board, make an additional cash payment to the Executive (the “Gross-Up Payment”). The Gross-Up Payment shall equal the amount needed to place the Executive in substantially the same after-tax economic position that the Executive would have been in had the Excise Tax not applied to the Payments.

      10.      Counterparts. This Agreement may be executed in two or more counterparts, and by different parties hereto on separate counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument. For all purposes a signature by fax shall be treated as an original.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

RICHARD CHIN	OXiGENE, INC.
/s/ Richard Chin	By:	/s/ James B. Murphy
Signature		Name: James B. Murphy Title: Vice President and Chief Financial Officer

Exhibit A

Genmedica Therapeutics
Stanford University School of Medicine
UCSF School of Medicine

Exhibit B

OXiGENE, Inc.

CONFIDENTIALITY, NONCOMPETITION
AND INTELLECTUAL PROPERTY AGREEMENT

June 29, 2006

Richard Chin
OXiGENE, Inc.

Dear Richard:

     As a condition of your employment with OXiGENE, Inc., you must sign and return this letter agreement (the “Agreement”). This Agreement confirms your promise to protect and preserve information and property which is confidential and proprietary to OXiGENE, Inc., its subsidiaries and affiliates (collectively, the “Company”), as well as other terms and conditions of your employment, including your agreement to reasonable limitations on the scope of your employment once your employment with the Company ends. No provision of this Agreement shall be construed to create an express or implied employment contract for any specific period of time, and the Company may terminate your employment at any time, with or without cause (in other words, you are an “at will” employee).

     You agree as follows:

1.    Your Duties Regarding Confidentiality

     The Company has developed, uses and maintains trade secrets^1/ and other confidential and proprietary information including, without limitation, technical and scientific data and specifications, research, business and financial information, product and marketing plans, customer and client information, customer and client lists, customer, client and vendor identities and characteristics, agreements, marketing knowledge and information, sales figures, pricing information, marketing plans, business plans, strategy forecasts, financial information, budgets, software, projections and procedures, and Inventions (as defined in Section 3), in written, oral, electronic and/or other forms (“Confidential Information”), and the Company shall take all reasonable measures to protect the confidentiality of such Confidential Information. You acknowledge that during your employment with the Company you will be given direct access to and knowledge of Confidential Information.

     You agree that all such Confidential Information is and shall remain the sole property of the Company and that you will hold in strictest confidence, and will not, either during or after the termination of your employment (except as required in the course of your duties on behalf of the Company), use, disclose or give to others (whether a business, firm, entity, person or otherwise), either directly or indirectly, any of the Confidential Information of the Company or of any third party provided to you during your employment by the Company, without the Company or such third party’s consent. Your obligation of confidentiality under this Agreement does not apply to information that (a) becomes a matter of public knowledge through no fault of your own or (b) must be disclosed pursuant to lawful subpoena, court order or statutory requirement.

     You further agree that you will return all Confidential Information, including all copies and versions of such Confidential Information (including but not limited to information maintained on paper, disk, CD-ROM, network server, or any other retention device whatsoever), and all other property of the Company, to the Company immediately upon the earlier of (a) the request of the Company or (b) termination of your employment.

^1/ The term “trade secrets,” as used in this Agreement, shall be interpreted in accordance with Massachusetts law and shall include, but not be limited to, anything tangible or intangible or electronically kept or stored, which constitutes, represents, evidences or records a secret scientific, technical, merchandising, production or management information, design, process, procedure, formula, invention or improvement; and other confidential and proprietary information and documents.

     The terms of this Section 1 of this Agreement are in addition to, and not in lieu of, any other contractual, statutory or common law obligations that you may have relating to the protection of the Company’s Confidential Information or its property. The terms of this section shall survive indefinitely your employment with the Company, provided that the Confidential Information of the Company remains confidential and is not a matter of public knowledge.

2.    Your Duties Not To Compete Or Solicit

     You acknowledge that the Confidential Information has been and will be developed by the Company at substantial investment of time, effort and money and that such Confidential Information would be useable by you to compete against the Company.

     Further, in the course of your employment you will be introduced to customers and others with important relationships to the Company. You acknowledge and agree that any and all “goodwill” created through such introductions belongs exclusively to the Company, including, but not limited to, any goodwill created as a result of direct or indirect contacts or relationships between yourself and any customers, vendors and other key relationships of the Company.

     A—Non-Competition

     While you are employed by the Company and for a period of one (1) year following the termination of your employment for any reason (the “Non-competition Period”), you shall not, for yourself or on behalf of any other person or entity, directly or indirectly, whether as principal, partner, agent, independent contractor, stockholder, employee, consultant, representative or in any other capacity, own, manage, operate or control, be connected with, or employed by, or engage in or have a financial interest in any Restricted Business (as defined in Section 2B) anywhere in the world (the “Restricted Territory”) except that nothing in this Agreement shall preclude you from purchasing or owning securities of any such business if such securities are publicly traded, and provided that your holdings do not exceed two (2%) percent of the issued and outstanding securities of any class of securities of such business.

     In addition, during the Non-competition Period you shall not, either individually or on behalf of or through any third party, solicit or divert or attempt to solicit or divert for the benefit of or on behalf of a Restricted Business, any customers, clients or vendors of the Company with whom you have had significant contact, access to Confidential Information about, or to whom you have provided services during your last two (2) years of employment with the Company.

     B—Definition of “Restricted Business”

     For purposes of this Agreement, the term “Restricted Business” shall mean any person, partnership, corporation, business organization or other entity (or a division or business unit of any entity) whose primary products are the same or similar to those that the Company is engaged in or is developing during your employment with the Company, including vascular targeting technologies to combat cancer, eye diseases and skin diseases, including but not limited to research, development, manufacture, marketing or sales; provided that (i) once your employment with the Company has terminated, this definition shall apply only with respect to products that are the same or similar to those that the Company was engaged in or developing during the last two (2) years of your employment with the Company, (ii) nothing in this definition shall operate to prevent you from working for or with respect to any subsidiary, division or affiliate (each, a “Unit”) of an entity if that Unit is not itself a Restricted Business engaged in any Restricted Activity (as defined below), irrespective of whether some other Unit of such entity constitutes a Restricted Business (as long as you do not provide any services for such other Unit), and (iii) Restricted Business will not include activities outside the spheres of vascular disrupting agents, ortho-quinone prodrugs, and bio-reductive agents.

     C—Non-Solicitation

     During the Non-competition Period you shall not, either individually or on behalf of or through any third party, directly or indirectly, solicit any Company employee or consultant to leave the Company, nor shall you, directly or indirectly, recruit, or hire away any Company employee. For purposes of this Section 2C, employees shall include any person who was an employee within the sixty (60) day period immediately preceding such solicitation or other prohibited action.

3.    Ownership of Ideas, Copyrights and Patents

     A—Property of the Company

     You agree that apart from the “Textbook of Clinical Research Medicine,” all ideas, discoveries, creations, manuscripts and properties, innovations, improvements, know-how, inventions, designs, developments, apparatus, techniques, methods, writings, specifications, sound recordings, pictorial and graphical representations and formulae (collectively, “Inventions”) which may be used by or which relate to the business or activities of the Company, whether patentable, copyrightable or not, which you may conceive, reduce to practice or develop during your employment (or, if based on or related to any Confidential Information, made by you within six (6) months after the termination of such employment), whether or not during normal working hours and whether or not on the Company’s premises or with the use of its equipment, whether alone or in conjunction with others, and whether or not at the request or suggestion of the Company or otherwise, relating in anyway to the Restricted Business shall be “works made for hire,” and shall be the sole and exclusive property of the Company, and that you shall not publish any such Inventions without the prior written consent of the Company. You hereby assign to the Company all of your right, title and interest in and to such Inventions. The manuscript for a textbook of clinical research, “Textbook of Clinical Research Medicine,” that is currently under preparation by you is specifically excluded from this provision.

     B—Your Duty to Cooperate

     During your employment with the Company and afterwards, you agree that you will fully cooperate with the Company, its attorneys and agents in the preparation and filing of all papers and other documents as may be required to perfect the Company’s rights in and to any such Inventions, including, but not limited to, joining in any proceeding to obtain letters patent, copyrights, trademarks or other legal rights of the United States and of any and all other countries on such Inventions, provided that the Company will bear the expense of such proceedings, and that any patent or other legal right so issued to you, personally, shall be assigned by you to the Company without charge by you.

     Further, you hereby irrevocably appoint the Company and its duly authorized officers and agents as your attorneys-in-fact to act for and on your behalf with respect to the Inventions, and, instead of you, to execute all documents and papers, including any application for patent, copyright or mask work, and to do all other lawfully permitted acts reasonably necessary to assign or otherwise transfer and perfect your right, title and interest in and to the Inventions to and in the Company, and to obtain, perfect, protect and enforce its rights in the Inventions. To the extent that cooperation is requested following your employment with the Company, you will be asked to devote no more than 40 hours of your time. For cooperation beyond 5 hours, appropriate compensation will be negotiated with the Company.

     C—Data In Which You Claim Any Interest

     Listed on Exhibit A to this Agreement are any and all Inventions in which you claim or intend to claim any right, title and interest, including but not limited to patent, copyright and trademark interest, which to the best of your knowledge shall be or may be delivered to the Company in the course of your employment, or incorporated into any Company product or system. You explicitly acknowledge that your obligation to disclose such information is ongoing during your employment with the Company, and that after you execute this Agreement, if you determine that any additional Inventions in which you claim or intend to claim any right, title or interest, including but not limited to patent, copyright and trademark interest, has been or is likely to be delivered to the Company or incorporated in any company product or system, you shall make immediate written disclosure of the same to the Company.

4.    Your Representations Regarding Prior Work and Legal Obligations

     A—No Other Agreement Prohibits You From Working For The Company

     By signing this Agreement, you represent that you have no agreement with or other legal obligation to any prior employer or to any other person or entity that restricts your ability to engage in employment discussions, to accept employment with, or to perform any function for the Company.

     B—You Will Not Provide Us Confidential Information From Other Employers

     You also acknowledge that the Company has advised you that at no time, either during any pre-employment discussions or at any time thereafter, should you divulge to or use for the benefit of the Company any trade secret or confidential or proprietary information of any previous employer. By signing this Agreement, you affirm that you have not divulged or used any such information for the benefit of the Company, and that you have not and will not misappropriate any Invention that you played any part in creating while working for any former employer.

5.    Provisions Necessary and Reasonable/Injunctive Relief

     You recognize and acknowledge that (i) the types of activities and employment which are prohibited by this Agreement are reasonable in relation to the skills which represent your principal salable asset both to the Company and to your other prospective employers, and (ii) the temporal and geographical scope of the provisions in this Agreement are reasonable, legitimate and fair to you and necessary for the protection of the Company. You acknowledge that given your skills and work experience, such restrictions will not prevent you from earning a living in your general field of occupation during the term of such restrictions. You further agree that a breach or threatened breach by you of Sections 1-3 of this Agreement may pose the risk of irreparable harm to the Company, and that in the event of a breach or threatened breach of any of such covenants, the Company shall be entitled to seek and obtain any remedies available to it at law or equity, including equitable relief, in the form of specific performance, or temporary, preliminary or permanent injunctive relief, or any other equitable remedy which then may be available. The seeking of such injunction or order shall not affect the Company’s right to seek and obtain damages or other equitable relief on account of any such actual or threatened breach.

6.    Disclosure to Future and Prospective Employers

     You agree that the Company may notify any of your future or prospective employers or other third parties of this Agreement and may provide a copy of this Agreement to such parties without your further consent.

7.    Choice of Law; Enforceability; Waiver of Jury Trial

     A—The Law of Massachusetts Applies to this Agreement

     This Agreement shall be deemed to have been made in the Commonwealth of Massachusetts, shall take effect as an instrument under seal within Massachusetts, and the validity, interpretation and performance of this Agreement shall be governed by, and construed in accordance with, the internal law of Massachusetts, without giving effect to conflict of law principles.

     B—Any Dispute Regarding This Agreement Will Take Place In Massachusetts

     Both of us agree that any action, demand, claim or counterclaim relating to, or arising under, the terms and provisions of this Agreement, or to its breach, shall be commenced in Massachusetts in a court of competent jurisdiction. We both further acknowledge that venue shall exclusively lie in Massachusetts and that material witnesses and documents would be located in Massachusetts.

8.    General

     A—Agreement Enforceable If You Are Transferred, Promoted or Reassigned

     You acknowledge and agree that if you should transfer between or among any affiliates of the Company, wherever situated, or be promoted or reassigned to functions other than your present functions, all terms of this Agreement shall continue to apply with full force.

     B—This is the Entire Agreement Between Us

     This Agreement embodies the entire agreement and understanding between us with respect to its subject matter and supersedes all prior and contemporaneous oral and written agreements and understandings relating to its subject matter. No

statement, representation, warranty, covenant or agreement of any kind not expressly set forth in this Agreement shall affect, or be used to interpret, change or restrict, the express terms and provisions of this Agreement.

     C—Modification and Amendment; Waiver; Assignment and Benefit

     The terms and provisions of this Agreement may be modified or amended only by written agreement executed by both parties. The terms and provisions of this Agreement may be waived, or consent for the departure from its terms granted, only by a written document executed by the party entitled to the benefits of such terms or provisions. No such waiver or consent shall be deemed to be or shall constitute a waiver or consent with respect to any other terms or provisions of this Agreement, whether or not similar. Each such waiver or consent shall be effective only in the specific instance and for the purpose for which it was given, and shall not constitute a continuing waiver or consent. The Company may assign its rights and obligations under this Agreement at its sole discretion. As this Agreement is personal to you, you may not assign your rights and obligations under this Agreement. All statements, representations, warranties, covenants and agreements in this Agreement shall be binding on the parties, and shall inure to the benefit of you, your heirs, executors and administrators and the Company and its successors and/or permitted assigns.

     D—Severability

     The parties intend this Agreement to be enforced as written. If any portion or provision of this Agreement shall to any extent be declared illegal or unenforceable by a duly authorized court having jurisdiction, however, we both desire that such portion or provision be modified by such a court so as to make it enforceable, and that the remainder of this Agreement be enforced to the fullest extent permitted by law. If such court deems any provision of this Agreement wholly unenforceable, then all remaining provisions shall nevertheless remain in full force and effect.

     E—Meaning of Headings

     The headings in this Agreement are for convenience only, and we both agree that they shall not be construed or interpreted to modify or affect the construction or interpretation of any provision of this Agreement.

YOUR ACKNOWLEDGMENT

     By signing this Agreement, you are acknowledging that you have had adequate opportunity to review this Agreement, to reflect upon and consider the terms and conditions of this Agreement and how they may affect you, that you fully understand this Agreement’s terms, and that you are agreeing voluntarily to its terms.

     If this document accurately reflects our agreement, please so indicate by signing and returning to us the enclosed copy of this letter.

Very truly yours,


OXIGENE, INC.
 

/s/ James B. Murphy  

By: James B. Murphy 

Its: Vice President and Chief Financial Officer 

Accepted and Agreed:

/s/ Richard Chin

Richard Chin
Date: June 29, 2006

Exhibit A

o Textbook of Clinical Research Medicine

EX-10.2

Exhibit 10.2

June 29, 2006

Fred Driscoll
15 Crestwood Road
North Reading, MA 01864

Dear Fred:

The purpose of this Separation Agreement (hereinafter the “Agreement”) is to confirm the terms of your separation from OXiGENE, Inc. (“OXiGENE” or “Company”). The promises made by the Company hereunder are contingent on your agreement to and compliance with the terms of this Agreement. The Effective Date of this Agreement shall be the eighth day following the day that you sign it.

     1.      Separation of Employment. You acknowledge that your employment as Chief Executive Officer of the Company ends effective June 29, 2006 (the “Separation Date”). By signing this Agreement, you shall have submitted your resignation as member of the Board of Directors to the Board of Directors, which resignation shall be effective on the Separation Date. In addition, you agree that you shall resign and the Company shall otherwise remove you as a signatory or fiduciary from all plans or accounts where you hold such role, such as bank accounts, retirement plans, and the like. Except as provided for below, you acknowledge that from and after the Separation Date you shall have no authority and shall not represent yourself as an employee, officer, director, or agent of the Company.

     2.      Consideration. In exchange for the mutual covenants set forth in this Agreement, and contingent on your valid execution of this Agreement, the Company agrees to provide you with the following Consideration:

(i) In accordance with your Employment Agreement, you shall be paid the gross severance amount of $325,000.00, which amount is equal to twelve (12) months of your base salary in effect as of the Separation Date. Such amount shall be paid as follows: $243,750.00 shall be paid in a lump sum, less applicable taxes and deductions, within ten (10) business days after the Effective Date. The remaining amount of $81,250.00 shall be paid in a lump sum on or before the one year anniversary of the Separation Date.

(ii) By law, and regardless of whether you sign this Agreement, you will have the right to continue your medical and dental insurance pursuant to the provisions of the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA). The COBRA “qualifying event” shall be deemed to be the Separation Date. If you complete the appropriate forms and execute this Agreement, the Company will cover the cost of the COBRA payments to continue your participation in OXiGENE’s medical and dental insurance plans during the one year period following the Separation Date to the same extent that such insurance is provided to persons employed by OXiGENE; provided that if you become eligible for insurance coverage through another employer, the Company’s obligations under this clause shall immediately cease. All other benefits shall cease as of the Separation Date.

(iii) The Company shall accelerate the vesting of the 80,000 shares of restricted stock granted on October 3, 2005 and currently held by you so that the restrictions on such shares lapse on the Separation Date. The Company agrees to waive its repurchase rights under paragraph 2.1(a) and any restrictions on transfer under paragraph 2.1(f) of the OXiGENE Restricted Stock Agreement.

(iv) As of the Separation Date, you will be vested in a total of 219,166 options. You may exercise any vested options by December 31, 2006. Subject to any provisions in the applicable stock plan that would extend

the exercise period for such options beyond December 31, 2006, any options not exercised by that date shall terminate. All unvested options shall terminate as of the Separation Date.

(v) Upon submission of proper documentation, the Company shall reimburse your reasonable attorneys fees incurred in negotiating the terms of this Agreement, up to a maximum of $3,500.00.

     3.      No Amounts Owing. You acknowledge that except for (i) the specific financial consideration set forth in this Agreement, (ii) any business expenses that are reimbursable in accordance with Company policy and have been submitted to the Company as of the Separation Date; and (iii) any salary and vacation pay that you shall earn up to the Separation Date (which shall be paid to you on or about the Separation Date), you have been paid and provided all wages, commissions, bonuses, vacation pay, holiday pay and any other form of compensation that may be due to you now or which would have become due in the future in connection with your employment with or separation of employment from Company.

     4.      Confidentiality and Related Covenants. You hereby agree and acknowledge the following:

(i) On or before the Separation Date, you will return to OXiGENE all Company documents (and any copies thereof) and property.

(ii) You reaffirm the covenants contained in Section 7 of your Employment Agreement with the Company and you agree that your obligations set forth thereunder shall continue for the one year period following the Separation Date.

(iii) You will not make any private or public (including to the print or electronic media) statements that are professionally or personally disparaging about, or adverse to, the interests of Company (including its officers, directors and employees) including, but not limited to, any statements that disparage any person, product, service, finances, financial condition, capability or any other aspect of the business of the Company, or engage in any conduct which is intended to harm professionally or personally the reputation of the Company (including its officers, directors and employees); provided, nothing herein shall apply to any statements made by you: (a) as may be required by law; (b) in any judicial or other adjudicatory proceeding or action; or (c) in any privileged or confidential communications with your counsel. The Company agrees that its officers and directors shall not make any private or public statements that are professionally or personally disparaging about you or your reputation; provided, that nothing in this paragraph shall interfere with the Company’s ability to comply with legal process, the requirements of applicable federal or state laws or regulations (including but not limited to applicable federal or state securities laws or regulations) or the requirements of governmental entities (including but not limited to any securities exchange, quotation system or over-the-counter market on which the Company has its securities listed or traded), to fulfill its public disclosure obligations, or to conduct its business.

(iv) The breach of any of the foregoing covenants by you shall relieve the Company of any further obligations hereunder and, in addition to any other legal or equitable remedy available to the Company, shall entitle the Company to recover from you any amounts already paid to you or on your behalf pursuant to Section 2 of this Agreement and to cease any further payments.

     5.      Cooperation. You agree that during your employment and thereafter you shall provide reasonable cooperation to the Company upon its request to assist in its defense or prosecution of any claims or actions now in existence or which may be brought or threatened in the future against or on behalf of the Company, including any claims or actions against its officers, directors and employees. Your cooperation in connection with such matters, actions and claims shall include, without limitation, to prepare for and/or participate in any proceeding (including, without limitation, consultation, discovery or trial) and to assist with any audit, inspection, proceeding or other inquiry. For any cooperation provided pursuant to this Section after the one year anniversary of the Separation Date, you shall be reimbursed for any reasonable documented costs, expenses and time in an amount equal to $250 per hour, plus reasonable attorneys’ fees, provided that you shall not be entitled to any such payment if the cooperation relates to a matter in which you are or have been threatened to be named as a defendant. Nothing herein shall be construed to require you to provide any cooperation

with respect to any matter in which your interests are or may be adverse to the interests of the Company, in which latter event your rights to indemnification by the Company (by Company By-laws or otherwise), if any, shall apply, subject to the terms of such indemnification rights.

     6.      Release of Claims.

(i) Release of Claims By You.

(a) You hereby agree and acknowledge that by signing this letter and agreeing to the Consideration to be provided to you, and other good and valuable consideration provided for in this Agreement, you are waiving your right to assert any form of legal claim against the Company^1/ whatsoever for any alleged action, inaction or circumstance existing or arising from the beginning of time through the date you sign this Agreement. Your waiver and release herein is intended to bar any form of legal claim, charge, complaint or any other form of action (jointly referred to as “Claims”) against the Company seeking any form of relief including, without limitation, equitable relief (whether declaratory, injunctive or otherwise), the recovery of any damages or any other form of monetary recovery whatsoever (including, without limitation, back pay, front pay, compensatory damages, emotional distress damages, punitive damages, attorneys fees and any other costs) against the Company, for any alleged action, inaction or circumstance existing or arising through the date you sign this Agreement.

Without limiting the foregoing general waiver and release, you specifically waive and release the Company from any waivable Claim arising from or related to your employment relationship with the Company or the termination thereof, including, without limitation:

** Claims under any state or federal discrimination, fair employment practices or other employment related statute, regulation or executive order (as they may have been amended through the Effective Date) prohibiting discrimination or harassment based upon any protected status including, without limitation, race, national origin, age, gender, marital status, disability, veteran status or sexual orientation. Without limitation, specifically included in this paragraph are any Claims arising under the federal Age Discrimination in Employment Act (“ADEA”), the Older Workers Benefit Protection Act, the Civil Rights Acts of 1866 and 1871, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Equal Pay Act, the Americans With Disabilities Act and any similar Massachusetts or other state statute.

** Claims under any other state or federal employment related statute, regulation or executive order (as they may have been amended through the Effective Date) relating to wages, hours or any other terms and conditions of employment. Without limitation, specifically included in this paragraph are any Claims arising under the Fair Labor Standards Act, the Family and Medical Leave Act of 1993, the National Labor Relations Act, the Employee Retirement Income Security Act of 1974, the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) and any similar Massachusetts or other state statute.

** Claims under any state or federal common law theory including, without limitation, wrongful discharge, breach of express or implied contract, promissory estoppel, unjust enrichment, breach of a covenant of good faith and fair dealing, violation of public policy, defamation, interference with contractual relations, intentional or negligent infliction of emotional distress, invasion of privacy, misrepresentation, deceit, fraud or negligence.

^1/ For the purposes of this Section, “Company” shall include OXiGENE, Inc. and any of its divisions, affiliates, subsidiaries and all other related entities, and its and their directors, officers, employees, trustees, agents, successors and assigns.

** Any other Claim arising under state or federal law.

(b) Notwithstanding the foregoing, this section does not release the Company from any obligation expressly set forth in this Agreement, is not intended to and shall not act as a waiver or release of any claims that you cannot by law waive or release, and does not waive or release any of your rights to indemnification by the Company.

(c) This Section does not prohibit you from challenging the validity of this release under the ADEA, filing a charge or complaint of discrimination with the federal Equal Employment Opportunity Commission (“EEOC”), or participating in any investigation or proceeding conducted by the EEOC. In addition, nothing in this release or this Agreement shall limit OXiGENE’s right to seek immediate dismissal of such charge or complaint on the basis that your signing of this Agreement constitutes a full release of any individual rights under the ADEA or other laws, or seek recovery from you, to the extent permitted by law, of the Consideration provided to you under this Agreement in the event that you successfully challenge the validity of this release and prevail on the merits of a claim under the ADEA or other laws.

(d) You acknowledge and agree that, but for providing this waiver and release, you would not be receiving the Consideration and other benefits being provided to you under the terms of this Agreement.

(ii)      Company’s Release of Claims. Notwithstanding Section 6(i)(c) above, the Company hereby agrees and acknowledges that by signing this Agreement and for other good and valuable consideration, it is, to the maximum extent allowed by the Company’s By-laws and applicable law, waiving and releasing its right to assert any form of legal claim against you whatsoever for any alleged action, inaction or circumstance existing or arising from the beginning of time through the Execution Date, but specifically excluding claims arising out of fraud by you. Subject to the foregoing exception, the Company’s waiver and release herein is intended to bar any form of legal claim, charge, complaint or any other form of action against you seeking any form of relief including, without limitation, equitable relief (whether declaratory, injunctive or otherwise), the recovery of any damages or any other form of monetary recovery whatsoever (including, without limitation, back pay, front pay, compensatory damages, emotional distress damages, punitive damages, attorney’s fees and any other costs) against you, for any alleged action, inaction or circumstance existing or arising through the Execution Date. Notwithstanding the foregoing, this section does not release you from any obligation expressly set forth in this Agreement.

     7.      ADEA Consideration and Rescission Periods. You and OXiGENE acknowledge that you are 40 years of age or older and that you therefore have specific rights under the ADEA, which prohibits discrimination on the basis of age. You and the Company further acknowledge and agree that the release set forth in the preceding paragraph is intended to release any right you may have to file a claim against Company alleging discrimination on the basis of age. Consistent with the provisions of the ADEA, you shall have twenty-one (21) days (the “Consideration Period”) from your receipt of this Agreement to consider and accept its terms by signing below, although you may execute the Agreement earlier if you wish. You are advised to consult with an attorney prior to signing this Agreement. In addition, you may rescind your assent to this Agreement if, within seven (7) days after the date you sign this Agreement (the “Rescission Period”), you deliver a notice of rescission to the Chairman of the Board of Directors, OXiGENE, Inc., 230 Third Avenue, Waltham, MA 02451. To be effective, such rescission must be hand delivered or postmarked within the seven (7) day period. Any such rescission shall not affect the termination of your employment, which shall in any event occur on the Separation Date.

     8.      Publicity. Any press release or other public disclosure of the terms and provisions of this Agreement, including filings required by securities laws, shall be subject to the prior review and comment of the other party as to those provisions relating to the terms and provisions of this Agreement. No party to this Agreement shall cause, discuss, cooperate or otherwise aid in the preparation of any press release or other publicity other than filings required by securities laws, concerning any other party to this Agreement or the Agreement’s operation without prior approval of such other party unless required by law, in which case notice of such requirement shall be given to the other party.

     9.      Taxation. We intend this Agreement to be in compliance with Section 409A of the Internal Revenue Code of 1986 (as amended). You acknowledge and agree, however, that the Company does not guarantee the tax treatment or tax consequences associated with any payment or benefit arising under this Agreement, including but not limited to consequences related to Code Section 409A. In the event any payments or benefits are deemed by the IRS to be non-compliant, this Agreement, at your option, shall be modified to the extent practicable, so as to make it compliant by altering the payments or benefits, or the timing of their receipt, provided that no such modification shall increase the Company’s obligations hereunder.

     10.      Voluntary Agreement. By executing this Agreement, you are acknowledging that you have been afforded sufficient time to consult with legal counsel and to understand the terms and effects of this Agreement, that your agreements and obligations hereunder are made voluntarily, knowingly and without duress, and that neither Company nor its agents or representatives have made any representations inconsistent with the provisions of this Agreement.

     11.      Entire Agreement/Choice of Law/Full Agreement. Except for your applicable stock option agreements and restricted stock agreement, Section 7 of your Employment Agreement, and as otherwise expressly provided for herein, this Agreement supersedes any and all prior oral and/or written agreements and sets forth the entire agreement between you and Company. No variations or modifications hereof shall be deemed valid unless reduced to writing and signed by the parties hereto. This Agreement shall take effect as an instrument under seal and shall be governed by and construed in accordance with the laws of Massachusetts, without giving effect to conflict of law principles. The provisions of this Agreement are severable, and if for any reason any part hereof shall be found to be unenforceable, the remaining provisions shall be enforced in full. Both you and the Company hereby waive your right to jury trial with respect to any claims related to this Agreement or to your employment with the Company. This Agreement shall be binding on you and the Company, and their respective heirs, successors, and assigns, including without limitation any company into which the Company may be merged, reorganized, or liquidated, or by which it may be acquired. The Company shall obtain any approvals from the Board of Directors of the Company (or any authorized committee thereof) necessary to effectuate the terms of this Agreement.

     If the foregoing correctly sets forth our understanding, please sign, date and return the enclosed copy of this Agreement to the Chief Financial Officer of OXiGENE, Inc., within 21 days of the date of this letter.

Very truly yours,


OXiGENE, Inc.
 

/s/ James B. Murphy  

By: James B. Murphy 

Its: Vice President and Chief Financial Officer 

Confirmed and Agreed:

/s/ Frederick Driscoll

Frederick Driscoll
Dated: June 29, 2006

EX-99.1

Exhibit 99.1

OXiGENE’S Board of Directors Names Experienced Biotech Executive, Richard Chin, M.D., as President and Chief Executive Officer

WALTHAM, Mass.—(BUSINESS WIRE)—June 30, 2006—

Dr. Chin, SVP of Global Development at Elan Corporation and Former Head of Clinical Research for the Biotherapeutics Unit at Genentech, Tapped to Lead OXiGENE Through Its Next Stage of Corporate Growth

OXiGENE, Inc. (NASDAQ: OXGN; XSSE: OXGN), a leading developer of biopharmaceutical compounds to treat oncologic and ophthalmologic diseases, announced that Richard Chin, M.D. has been appointed to the position of President and Chief Executive Officer, replacing Frederick Driscoll.

Dr. Chin, a Harvard trained, Board Certified Internist, and a current member of OXiGENE’s Board of Directors, brings with him extensive experience in drug development and corporate collaborations. During Dr. Chin’s tenures at Elan Corporation, Genentech and Procter & Gamble, he oversaw over 40 Investigational New Drug (IND) Applications for new molecular entities and new indications, and eight New Drug Applications (NDAs)/Biologic License Applications (BLAs). Most recently, he oversaw the approval of the reintroduction of TYSABRI(R), a multiple sclerosis drug developed in collaboration with Biogen Idec. Other FDA approved products which Dr. Chin was instrumental in launching are TNKase™ (for myocardial infarction), Raptiva(R) (for psoriasis), Xolair(R) (for asthma), Cathflo(R) (for catheter clearance) and Prialt(R) (for pain). He also has significant expertise in the development of angiogenic and antiangiogenic therapies. He played a critical role in developing Lucentis™ (for age-related macular degeneration), oversaw the Vascular Endothelial Growth Factor (VEGF) program for wound healing, and led the Avastin(R) non-oncology teams at Genentech. Also at Genentech, he led the Herceptin(R) cardiotoxicity team and oversaw multiple programs for Rituxan(R) in immunological diseases as well as the Hedgehog antagonist basal cell carcinoma program.

“We are pleased to have a person of Richard’s caliber on our management team to dynamically lead the Company and its compounds towards potential commercialization,” commented Joel Citron, Chairman of the Board of Directors at OXiGENE. “Richard’s therapeutic development expertise combined with his extensive knowledge of global regulatory processes will be invaluable as OXiGENE works to advance its lead compounds for the treatment of oncology and certain eye diseases.”

In Dr. Chin’s most recent role as Senior Vice President and Head of Global Development for Elan Corporation, he had worldwide responsibility for Clinical Development, Regulatory, Biostatistics, Quality Assurance/Compliance, Chemistry Manufacturing and Control, Safety and Medical Affairs, comprising up to 300 employees. Previously, Dr. Chin served in various clinical and scientific roles of increasing responsibility for Genentech, Inc., and ultimately served as the Head of Clinical Research for the Biotherapeutics Unit. In this position, Dr. Chin oversaw approximately half of all Phase I through Phase IV clinical trials for Genentech, including over 20 products. Dr. Chin also oversaw clinical due diligence for all non-oncology business development activities at Genentech and has extensive experience managing multiple corporate partnerships, including relationships with Boehringer Ingelheim, Xoma, Roche, Biogen Idec, Aventis, and Cor (now Millenium), among others. Dr. Chin began his career at Procter & Gamble Pharmaceuticals where he served as Associate Medical Director.

“I am a strong believer in the potential of vascular disrupting technology and was delighted to join OXiGENE’s Board of Directors last August,” commented Dr. Richard Chin. “Today, I am honored to assume my new role and to lead OXiGENE in its next phase of growth, including the clinical, regulatory, and business development activities that will be required to bring Combretastatin to potential market commercialization. I look forward to working and collaborating with the stellar team of employees at OXiGENE as we strive to bring new therapeutics to patients with significant unmet medi cal needs.”

Dr. Chin holds a Medical Degree from Harvard Medical School. He received a Masters and Bachelor of Arts degree in Law with honors from Oxford University, England under a Rhodes Scholarship. He graduated with a Bachelor of Arts in Biology, magna cum laude, from Harvard University. Dr. Chin is a Diplomate, American Board of Internal Medicine and is licensed to practice medicine in California. He previously served on the adjunct clinical faculty at

Stanford Medical School.

Mr. Citron concluded, “We thank Fred Driscoll for his leadership during an important and challenging phase of OXiGENE’s growth and development. Fred, who has been with OXiGENE for approximately six years, has been instrumental in positioning the Company for success with its vascular disruption technology.”

About OXiGENE, Inc.

OXiGENE is an emerging pharmaceutical company developing novel small-molecule therapeutics to treat oncologic and ophthalmic diseases. The Company’s major focus is clinical advancement of drug candidates that selectively disrupt abnormal blood vessels associated with solid tumor progression and visual impairment. OXiGENE is dedicated to leveraging its intellectual property position and therapeutic development expertise to bring life saving and enhancing medicines to patients.

Safe Harbor Statement

Certain statements in this news release may be considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to: the timing and results of clinical development of CA4P; the therapeutic promise of the vascular disrupting mechanism; and the availability of resources to execute on critical corporate objectives. Any or all of the forward-looking statements in this press release may turn out to be wrong. They can be affected by inaccurate assumptions OXiGENE might make or by known or unknown risks and uncertainties, including, but not limited to: the early stage of product development; the ability to secure necessary patents; uncertainties as to the future success of ongoing and planned clinical trials; and the unproven safety and efficacy of products under development. Consequently, no forward-looking statement can be guaranteed, and actual results may vary materially. Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in OXiGENE’s reports to the Securities and Exchange Commission, including OXiGENE’s Form 10-Q, 8-K and 10-K reports. However, OXiGENE undertakes no obligation to publicly update forward-looking statements, whether because of new information, future events or otherwise.

All trademarks and/or registered trademarks in this release are the property of their respective holders.

CONTACT: OXiGENE, Inc.
Susan Hager, 781-547-5900
Director of Communications
shager@oxigene.com