Xenetic Biosciences, Inc. (NASDAQ:XBIO) Files An 8-K Unregistered Sales of Equity Securities

Item 3.02

On April 3, 2017, Xenetic Biosciences, Inc. (the Company) issued
an inducement award in the form of an option to purchase up to
175,000 shares of the Companys common stock, par value $0.001 per
share, to James F. Parslow in connection with his appointment as
Chief Financial Officer of the Company. The Compensation
Committee of the Companys Board of Directors (the Compensation
Committee) granted the inducement award to Mr. Parslow outside of
the Companys 2014 Equity Incentive Plan as a material inducement
to Mr. Parslows acceptance of employment with the Company in
accordance with NASDAQ Listing Rule 5635(c)(4).

The inducement award is exempt from the registration requirements
of the Securities Act of 1933, as amended (the Securities Act) by
virtue of Section 4(a)(2) thereof and/or Regulation D promulgated
thereunder. The Company intends to file a registration statement
on Form S-8 with the Securities and Exchange Commission to
register the shares underlying the inducement award as the shares
of the Companys common stock that would be received upon the
exercise of the option are not currently covered by an effective
registration statement.

The disclosure contained in Item 5.02 of this Current Report on
Form 8-K regarding the issuance of the inducement award to Mr.
Parslow is incorporated by reference into this Item 3.02.

Appointment of Chief Financial Officer

On April 4, 2017, the Company announced that Mr. Parslow has been
appointed to serve as the Companys Chief Financial Officer,
effective April 3, 2017. Mr. Parslow will also serve as the
Companys principal financial officer, effective April 3, 2017.

Mr. Parslow, age 52, most recently served as Chief Financial
Officer, Treasurer and Secretary of World Energy Solutions, Inc.,
a publicly-traded business-to-business e-commerce company
brokering energy and environmental commodities, from 2006 until
its acquisition by EnerNOC, Inc. in 2015. Since 2015, he has
served as an independent consultant providing interim chief
financial officer services to multiple emerging technology
companies. Mr. Parslow is a Certified Public Accountant with more
than 25 years of experience serving private and public companies
in the alternative energy, online auction, and high-tech
manufacturing industries. He holds an A.B. in Economics and
Accounting from the College of the Holy Cross and an M.B.A. with
a concentration in Finance from Bentley University.

Mr.Parslow does not have a family relationship with any director
or executive officer of the Company or person nominated or chosen
by the Company to become a director or executive officer, and
there are no arrangements or understandings between Mr.Parslow
and any other person to which Mr.Parslow was selected to serve as
Chief Financial Officer of the Company. There are no
relationships or transactions between Mr. Parslow and the Company
that would be required to be disclosed under Item 404(a) of
Regulation S-K.

Employment Agreement and Other Compensatory
Arrangements

In connection with Mr. Parslows appointment, the Company entered
into an employment agreement with Mr.Parslow effective as of
April 3, 2017 (the Employment Agreement). The Employment
Agreement does not provide for a specified term of employment and
Mr. Parslows employment is on an at-will basis. Mr.Parslow will
receive an initial annual base salary of $265,000 and is eligible
to earn an annual cash incentive bonus, which is initially set at
a target aggregate bonus amount of 35% of Mr. Parslows base
salary, upon achievement of certain individual and/or Company
performance goals set by the Compensation Committee. Mr. Parslow
is also eligible to participate in the Companys employee benefit,
welfare and other plans, as may be 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. Mr. Parslow
is also subject to certain customary confidentiality,
non-solicitation and non-competition provisions.

Further, as a material inducement to Mr. Parslows acceptance of
employment with the Company, the Compensation Committee approved
the grant to Mr. Parslow of an option to purchase up to 175,000
shares of the Companys common stock, with a per share exercise
price equal to $4.57, the closing price of the Companys common
stock on the NASDAQ Capital Market on the grant date of April 3,
2017. The option has a ten-year term and will vest over three
years, with one-third of the underlying shares vesting on each of
the first, second, and third year anniversaries of Mr. Parslows
start date, subject to Mr. Parslows continuous service with the
Company through each vesting date. The grant is being made to a
stand-alone inducement award option agreement (the Inducement
Award Agreement) outside of the Companys 2014 Equity Incentive
Plan as a material inducement to Mr. Parslows acceptance of
employment with the Company in accordance with NASDAQ Listing
Rule 5635(c)(4) and is subject to the terms and conditions of the
Inducement Award Agreement. In the event of a change in control
of the Company (as defined in the Inducement Award Agreement),
the unvested shares subject to the option shall fully vest upon a
change in control.

If Mr. Parslows employment is terminated by the Company without
cause (as defined in the Employment Agreement) or Mr. Parslow
resigns for good reason (as defined in the Employment Agreement),
after a period of six months of employment but before his first
anniversary with the Company, he will be entitled to receive (i)
six months of his then current base salary, paid over time in
accordance with the Companys payroll practices then in effect and
(ii) payment of premiums for continued health benefits under
COBRA for up to six months. If Mr. Parslows employment is
terminated by the Company without cause (as defined in the
Employment Agreement) or Mr. Parslow resigns for good reason (as
defined in the Employment Agreement), after his first anniversary
with the Company, he will be entitled to receive (i) one year of
his then current base salary, paid over time in accordance with
the Companys payroll practices then in effect and (ii) payment of
premiums for continued health benefits under COBRA for up to one
year.

The foregoing descriptions of the Employment Agreement and the
Inducement Award Agreement are not complete and are qualified in
their entireties by reference to the full texts of the Employment
Agreement and the Inducement Award Agreement, copies of which are
filed herewith as Exhibit 10.1 and Exhibit 10.2, respectively,
and are incorporated by reference herein.

On April 4, 2017, the Company issued a press release announcing
the appointment of Mr. Parslow as the Companys Chief Financial
Officer, effective April 3, 2017. A copy of the Companys press
release is furnished with this Current Report on Form 8-K and
attached hereto as Exhibit 99.1.

The information in this Item 7.01, including Exhibit 99.1, shall
not be deemed filed for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended, nor shall it be deemed
incorporated by reference into any filing under the Securities
Act, regardless of any general incorporation language in such
filing.

(d)Exhibits

About Xenetic Biosciences, Inc. (NASDAQ:XBIO)

Xenetic Biosciences, Inc. is a clinical-stage biopharmaceutical company. The Company is focused on the research and development of certain pharmaceutical products for use in humans that includes the use of the Company’s platform technologies that enables the creation of drug therapies primarily for orphan indications. The Company’s technologies include PolyXen, Virexxa, OncoHist and ImuXen. The Company is focused primarily on developing its lead product candidates, including ErepoXen, Virexxa and OncoHist, and PolyXen technology. The Company’s lead product candidate ErepoXen, a polysialylated form of erythropoietin (EPO) for the treatment of anemia in pre-dialysis patients with chronic kidney disease, and Food and Drug Administration (FDA) orphan designated oncology therapeutics Virexxa and OncoHist for the treatment of progesterone receptor negative endometrial cancer and refractory Acute Myeloid Leukemia, respectively. It is also developing PSA-FVIII.

Xenetic Biosciences, Inc. (NASDAQ:XBIO) Recent Trading Information

Xenetic Biosciences, Inc. (NASDAQ:XBIO) closed its last trading session 00.00 at 4.57 with 15,196 shares trading hands.