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                                                                   EXHIBIT 10.05

                          SPONSORED RESEARCH AGREEMENT

         This Sponsored Research Agreement (the "Agreement") is made by and
between EMORY UNIVERSITY, a nonprofit Georgia corporation with offices located
at 1784 North Decatur Road, Suite 510, Atlanta, Georgia 30322 ("University") and
ATHEROGENICS, INC., a for profit Georgia corporation organized and existing
under the laws of the State of Georgia with offices located at 3065 Northwoods
Circle, Norcross, GA 30071 (hereinafter referred to as "Sponsor").

         WHEREAS, Sponsor desires that University perform certain research work
in collaboration with Sponsor as hereinafter described and is willing to advance
funds to sponsor such research;

         WHEREAS, Sponsor desires to obtain certain rights to patents and
technology developed during the course of such research with a view to
profitable commercialization of such patents and technology for the Sponsor's
benefit; and

         WHEREAS, University is willing to perform such research and to grant
rights to such patents and technology;

         NOW THEREFORE, in consideration of the mutual covenants and promises
herein contained, the University and the Sponsor agree as follows:


[ * ]    Certain confidential information contained in this document, marked by
         an asterisk within brackets has been omitted and filed separately
         with the Securities and Exchange Commission pursuant to a request for
         confidential treatment under Rule 406 of the Securities Act of 1933,
         as amended.
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                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                   PAGE
                                                                                                                   ----

<S>                                                                                                                <C>
I.       EFFECTIVE DATE..........................................................................................     3

II.      RESEARCH PROGRAM........................................................................................     3

III.     COMPENSATION............................................................................................     3

IV.      CONSULTATION AND REPORTS................................................................................     4

V.       PUBLICITY...............................................................................................     5

VI.      PUBLICATION AND ACADEMIC RIGHTS.........................................................................     5

VII.     CONFIDENTIAL INFORMATION................................................................................     6

VIII.    PATENTS, COPYRIGHTS, AND TECHNOLOGY RIGHTS..............................................................     8

IX.      LIABILITY...............................................................................................     8

X.       INDEPENDENT CONTRACTOR..................................................................................     9

XI.      TERM AND TERMINATION....................................................................................     9

XII.     ATTACHMENTS.............................................................................................     9

XIII.    GENERAL.................................................................................................     9


ATTACHMENTS

RESEARCH PROGRAM.................................................................................................    12

PAYMENT SCHEDULE.................................................................................................    13

PATENTS, COPYRIGHTS, AND TECHNOLOGY RIGHTS.......................................................................    14

CONFIDENTIALITY AGREEMENT........................................................................................    18

LICENSE AGREEMENT OF JANUARY 1995................................................................................    19
</TABLE>


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                                I. EFFECTIVE DATE

           This Agreement shall be effective as of November 1, 1996.

                              II. RESEARCH PROGRAM

         2.1      University will use its best efforts to conduct the Research
Program in collaboration with Sponsor as described in Attachment A, and will
furnish the facilities necessary to carry out its part of the Research Program.
The Research Program will be under the direction of Dr. Dennis Liotta, or his
successor as mutually agreed to by the parties hereto ("Principal
Investigator"), and will be conducted by the Department of Chemistry at the
University.

         2.2      The Research Program shall be performed during the period from
________, 1996 through and including __________, 1997 ("the Performance
Period"). Sponsor shall have the option to extend the Performance Period in one
year increments for a total of five (5) years. Funding for each additional year
shall be mutually agreed upon by Sponsor and University at the beginning of each
extension year.

         2.3      The Principal Investigator shall use his best efforts to
achieve the goals of the Research Program. The Principal Investigator shall work
with Sponsor to determine the means for performing the Research Program so as
best to achieve these goals.

         2.4      University and Principal Investigator shall keep accurate
financial and scientific records relating to the Research Program and shall make
such records available to Sponsor or its authorized representative throughout
the Term of the Agreement during normal business hours upon reasonable notice.

                                III. COMPENSATION

         3.1      As consideration for the performance by University of its
obligations under this Agreement, Sponsor shall pay the University an amount
equal to its expenditures and reasonable overhead in conducting the Research
Program subject to a maximum expenditure limitation of [*] for the initial one
year Performance Period as set forth in Attachment B hereto. An initial payment
of [*] shall be made within thirty (30) days after the time of execution of this
Agreement and subsequent payments shall be made as quarterly advance payments of
up to [*] at three (3) month intervals after the Effective Date. Payments for
any extensions of the Performance Period shall also be in equal quarterly
advance payments based on the specific budget to be agreed upon at the time of
renewal. Unexpended funds shall be reimbursed to Sponsor at the end of each year
unless agreed to otherwise by Sponsor and University.

         3.2      Funds paid by Sponsor shall include indirect payments to the
University. Indirect payments shall be included at the rate of [*] of the total
payment for the initial one year Performance Period. For each extension year,
the indirect rate shall increase [*] of the total payment until it reaches a
maximum of [*] of the total payment, as follows:



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<TABLE>
<S>                                    <C>
year 1                                 [*]
year 2                                 [*]
year 3                                 [*]
year 4                                 [*]
year 5                                 [*]
</TABLE>

         3.3      University shall maintain all Research Program funds in a
separate account and shall expend such funds for wages, supplies, equipment,
travel, and other operation expenses in connection with the Research Program in
reasonable accordance with the Budget set forth in Attachment B hereto. It is
understood that funds of the Research Program may be transferred between
categories at the Principal Investigator's discretion, and funds which are not
used in a particular quarter may be used in subsequent quarters within each
Performance Period year.

         3.4      University shall retain title to all equipment purchased
and/or fabricated by it with funds provided by Sponsor under this Agreement.

                          IV. CONSULTATION AND REPORTS

         4.1      Sponsor's Designated Representative for consultation and
communications with the Principal Investigator shall be Dr. Patty Somers, or
such other persons as Sponsor may from time to time designate in writing to
University and the Principal Investigator.

         4.2      During the Term of this Agreement, Sponsor's representatives
may consult informally with University's representatives regarding the project,
both personally and by telephone. Access to work carried on in University
Laboratories in the course of these investigations shall be made available to
Sponsor's Designated Representative on a reasonable basis. Clinical and other
data shall be made available as it is generated and analyzed.

         4.3      The Principal Investigator and Sponsor's technical
representatives, including Sponsor's Designated Representative, shall meet on a
quarterly basis (every three (3) months) during the Performance Period to
discuss research results and set objectives for the next three (3) month period.
At the conclusion of each year, and within 120 days of termination of the
Agreement, the Principal Investigator and University's Office of Grant and
Contract Accounting (within thirty (30) days after the conclusion of each year)
shall also submit technical and financial reports, respectively, summarizing the
Research Program, and specifically containing:

                  a.       A summary of income and expenses of the Research
                           Program for the prior year (Office of Grant and
                           Contract Accounting); and


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                  b.       A report of all activities undertaken and
                           accomplishments achieved through the Research Program
                           during the prior year (Principal Investigator).

         4.4      To facilitate the collaborative aspects of the Research
Program and to assist Sponsor's in-house research and development efforts,
Sponsor shall be provided any tangible technical materials which are produced by
the University in the course of the Research Program. In this regard, the
University agrees to provide Sponsor with research quantities of any tangible
technical material produced by the University in the course of the Research
Program and available in transferrable quantities upon written request of
Sponsor to do so. Any reasonable extra costs incurred by the University over and
above the costs set forth in Article III above in supplying such tangible
technical materials to Sponsor shall be paid by Sponsor on receipt of an
appropriate invoice from University.

                                  V. PUBLICITY

         No press release or any other written statements in connection with
work performed under this Agreement intended for use in the public media making
any reference to one party hereunder shall be made by the other party, except as
provided below. University, however, shall have the right to acknowledge
Sponsor's support of the investigations under this Agreement in scientific or
academic publications and other scientific or academic communications. In any
such statement, the parties shall describe the scope and nature of their
participation accurately and -appropriately. Any press release developed by
University regarding this Research Program will be submitted to Sponsor thirty
(30) days in advance of planned release, and Sponsor shall have the right to
review and comment upon such proposed press release to determine if
Sponsor-furnished Confidential Information or patentable information is included
therein. If so, the provisions regarding deferral of publications set forth in
Article VI below shall be applicable to such release.

                       VI. PUBLICATION AND ACADEMIC RIGHTS

         6.1      University and the Principal Investigator have the right to
publish or otherwise publicly disclose information gained in the course of this
Agreement. In order to avoid loss of patent rights as a result of premature
public disclosure of patentable information and to provide Sponsor an
opportunity to review proposed publication materials to determine whether such
material contains Sponsor-furnished Confidential Information (as defined in
Article VII), University will submit any prepublication materials to Sponsor for
review and comment at least thirty (30) days prior to planned submission for
publication.

         Sponsor shall notify University within this thirty (30) days period
whether Sponsor-furnished Confidential Information is contained therein and
whether it desires patent applications to be filed on any inventions contained
in the materials, in accord with the provisions of Attachment C. If requested by
Sponsor, University shall delay publication of any portion of the


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materials for an additional period not to exceed ninety (90) days, unless a
further extension is mutually agreed upon, in order to facilitate filing of a
patent application in the United States. University shall have final authority
to determine the scope and content of any publications; however if any such
publication discloses Sponsor's Confidential Information (as defined in Article
VII), University agrees to delete such information prior to publication.

         6.2      It is understood that the University investigators may discuss
the research being performed under this Agreement with other investigators but
shall not reveal information which is Sponsor's Confidential Information under
Article VII hereof, nor shall a public disclosure of patentable information be
made except as set forth in Article V and in Paragraph 6.1 hereof. In the event
any joint inventions relating to the subject matter of the Research Program,
between the University investigators being funded by this Agreement and other
investigators, result from such discussions, University shall grant to Sponsor
the rights outlined in Attachment C to this Agreement, except that, in the event
there exist obligations, relating to the joint inventions, to another party as a
result of the involvement of the other investigators, University shall, in good
faith, exercise reasonable efforts to enable Sponsor to obtain full rights to
the joint invention.

                          VII. CONFIDENTIAL INFORMATION

         7.1      The parties may wish, from time to time, in connection with
work contemplated under this Agreement, to disclose Confidential Information to
each other. For the term of this Agreement and for a period of four (4) years
following termination of this Agreement, Sponsor and University each agrees that
it shall regard, maintain and preserve the secrecy and confidentiality of any
and all information and data, whether in oral or written form, including but not
limited to, products, processes, methods, concepts, ideas, programs, formulas,
apparatuses, chemicals, organisms, molecules, prototypes, techniques, know-how,
marketing plans, business plans, financial information, data, strategies,
forecasts, customer lists or technical requirements of customers, or other trade
secrets (collectively referred to herein as the "Proprietary Information") of
the other party which may be disclosed to or obtained by it pursuant to this
Agreement. Sponsor and University each agrees that it will not, at any time
without the prior written consent of the other party, use or disclose the
Proprietary Information belonging to the other party for any reason or in any
manner whatsoever except as may be necessary for the operation of this
Agreement, as explicitly authorized under this Agreement, or as required by law.

         7.2      Sponsor and University shall each take the same measures to
preserve the secrecy and confidentiality and avoid the unauthorized use or
disclosure of the other party's Proprietary Information as such party takes to
protect its own Proprietary Information.

         7.3      Sponsor and University shall each limit access to the
Proprietary Information to those of its employees and agents, Affiliates,
sublicensees, consultants, outside contractors, governmental regulatory
authorities and clinical investigators who have a reasonable need for access to
such information in connection with the operation of this Agreement. The
University


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shall require all personnel assigned to the Research Program to comply with, and
to assist the University in complying with, the terms of the Agreement,
including maintaining the confidentiality of Sponsor's Confidential Information.
To this end the University shall require all personnel assigned to the Research
Program to individually sign a confidentiality agreement in the form attached as
Attachment D. Further, each party or its Affiliates or sublicensees may disclose
Proprietary Information to the United States government or other regulatory
authorities to the extent that such disclosure is necessary for the prosecution
and/or enforcement of patents or for authorizations to conduct clinical trials
or commercially market Licensed Products, provided that such party is otherwise
entitled to engage in such activities under this Agreement, or may disclose
Proprietary Information as is necessary to exercise any rights which survive
termination or expiration of this Agreement. All persons or entities to whom
Proprietary Information is disclosed shall be subject to the non-disclosure
covenants contained herein.

         7.4      Sponsor and University shall each use its best efforts to
disclose Proprietary Information to the other in writing and marked as
proprietary. If it is necessary to first disclose such information other than in
written form, the disclosing party shall, within thirty (30) days of such first
disclosure, reduce the information to writing and provide the receiving party
with a copy of such information marked as proprietary.

         7.5      Sponsor and University each acknowledges that the disclosure
of Proprietary Information under this Agreement confers no rights in the
receiving party other than the right to use the Proprietary Information of the
disclosing party for the operation of this Agreement. Upon termination of this
Agreement, or forthwith upon the request of the other party, Sponsor and
University shall promptly return to the other party all such documents,
drawings, samples, specimens or reproductions thereof which may have come into
its possession.

         7.6      The obligations undertaken by Sponsor and University hereunder
shall not apply to any portion of the Proprietary Information disclosed
hereunder which:

                  a.       was known to the non-disclosing party prior to
                           disclosure of such Proprietary Information by the
                           disclosing party; or

                  b.       is, or shall become, other than by an act or omission
                           of the non-disclosing party, generally available to
                           the public; or

                  c.       shall, by lawful means, be made available to the
                           non-disclosing party by a third party with the right
                           to disclose; or

                  d.       is required by law to be disclosed by the
                           non-disclosing party, provided the non-disclosing
                           party uses its best efforts to notify the disclosing
                           party immediately upon learning of such requirement
                           in order to give the disclosing party reasonable
                           opportunity to oppose such requirement; or


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                  e.       results from research and development by the
                           receiving party or its Affiliates or sublicensees,
                           independent of disclosures from the other party of
                           this Agreement, provided that the persons developing
                           such information have not had any exposure to the
                           information received from the disclosing party; or

                  f.       Sponsor and University agree in writing may be
                           disclosed.

         7.7      In claiming the benefit of any of these exceptions, the
non-disclosing party shall have the burden of establishing that a portion of the
Proprietary Information is subject to such exception.

                VIII. PATENTS, COPYRIGHTS, AND TECHNOLOGY RIGHTS

         As partial consideration for payments made by Sponsor hereunder,
Sponsor and University agree to the terms concerning patents, copyrights, and
technology rights set forth in Attachment C.

                                  IX. LIABILITY

         9.1      Sponsor agrees to hold harmless the University, its officers,
agents and employees from any liability, loss or damage Sponsor may suffer as a
result of claims, demands, costs or judgments against Sponsor arising out of the
activities to be carried out pursuant to the obligations of this Agreement, and
the use by Sponsor of the results obtained from the activities performed by
University under this Agreement; provided, however, that any such liability,
loss or damage resulting from the following Sub-sections "a" or "b" is excluded
from this Agreement to hold harmless:

                  a.       the negligent or willful failure of University to
                           substantially comply with any applicable FDA or other
                           governmental requirement; or

                  b.       the negligence or willful malfeasance of any officer,
                           agent or employee of University.

         9.2      Both parties agree that upon receipt of a notice of claim or
action arising from activities to be carried out pursuant to the obligations of
this Agreement, the party receiving such notice will notify the other party
promptly.

                            X. INDEPENDENT CONTRACTOR

         For the purposes of this Agreement and all services to be provided
hereunder, the parties shall be, and shall be deemed to be, independent
contractors and not agents or employees of the other party. Neither party shall
have authority to make any statements, representations or


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commitments of any kind, or to take any action which shall be binding on the
other party, except as may be expressly provided for herein or authorized in
writing.

                            XI. TERM AND TERMINATION

         11.1     This Agreement shall commence with the Effective Date hereof
and extend until the end of the Research Program as described herein, unless
sooner terminated in accordance with the provisions of this Section ("Term").

         11.2     This Agreement maybe terminated by the mutual agreement of the
parties or by either party upon thirty (30) days written notice, if the
Principal Investigator's tenured appointment with the University terminates and
a suitable replacement (reasonably acceptable to the Sponsor) is not identified.

         11.3     In the event that either party shall be in default of its
material obligations under this Agreement and shall fail to remedy such default
within sixty (60) days after receipt of written notice thereof, the other party
may terminate this Agreement upon expiration of the sixty (60) day period.

         11.4     Termination or cancellation of this Agreement shall not affect
the rights and obligations of the parties accrued prior to termination. As its
sole liability upon termination, Sponsor shall pay University for all reasonable
expenses incurred as of the effective termination date, including salaries for
appointees.

         11.5     Any provisions of this Agreement which by their nature extend
beyond termination hereof shall survive such termination.

                                XII. ATTACHMENTS

         Attachments A, B, C, D and E are incorporated herein and made a part
hereof for all purposes.

                                  XIII. GENERAL

         13.1     This Agreement may not be assigned by either party without the
prior written consent of the other party; provided, however, that subject to the
approval of University, which may not be unreasonably withheld, Sponsor may
assign this agreement to any purchaser or transferee of all or substantially all
of Sponsor's assets or stock upon prior written notice to University, and
University may assign its right to receive payments hereunder.

         13.2     This Agreement constitutes the entire and only agreement
between the parties relating to the Research Program, and all prior
negotiations, representations, agreements and understandings are superseded
hereby. No agreements altering or supplementing the terms


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hereof may be made except by means of a written document signed by the duly
authorized representatives of the parties.

         13.3     Any notice required by this Agreement by Articles VIII, IX,
or XI shall be given by prepaid, first class, certified mail, return receipt
requested, addressed in the case of the University to:

                  Emory University
                  Office of Sponsored Programs
                  1784 North Decatur Road, Suite 510
                  Atlanta, GA 30322
                  Attention: Nancy L. Wilkinson, M.P.H.

or in the case of Sponsor to:

                  AtheroGenics, Inc.
                  3065 Northwoods Circle
                  Norcross, GA  30071
                  Attention:  Dr. Patty Somers

with a copy to:

                  Lyon and Lyon
                  633 West Fifth Street, Suite 4700
                  Los Angeles, California  90071-2066
                  Attention:  Carol A. Schneider, Ph.D.

Notices and other communications regarding the day-to-day administration and
operations of this Agreement shall be mailed or delivered, addressed in the case
of University to:

                  Emory University
                  Office of Sponsored Projects
                  1784 North Decatur Road, Suite 510
                  Atlanta, GA 30322
                  Attention: Nancy L. Wilkinson, M.P.H.

with a copy to:

                  Dr. Dennis Liotta
                  Emory University
                  Department of Chemistry


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or in the case of the Sponsor to:

                  AtheroGenics, Inc.
                  3065 Northwoods Circle
                  Norcross, GA 30071
                  Attention:  Dr. Patty Somers

or at such other addresses as may be given from time to time in accordance with
the terms of this notice provision.

         13.4     This Agreement shall be governed by, construed, and enforced
in accordance with the internal laws of the State of Georgia.

         IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized representatives.


ATHEROGENICS, INC.                  EMORY UNIVERSITY

By: Patricia Somers                 By: Nancy L. Wilkinson
   -------------------------------     ----------------------------
         Dr. Patty Somers                  Nancy L. Wilkinson
Title:   Senior Scientist           Title: Assistant Vice President for Research
Date:    October 14, 1996           Date:  September 30, 1996


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                                  ATTACHMENT A
                                RESEARCH PROGRAM

         The Principal Investigator, Dr. Dennis Liotta, will study [*].


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                                  ATTACHMENT B
                                PAYMENT SCHEDULE

         See COMPENSATION 3.1 of the Sponsored Research Agreement.


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                                  ATTACHMENT C
                   PATENTS, COPYRIGHTS, AND TECHNOLOGY RIGHTS

         I.       Definitions: The following terms shall have the indicated
meanings when, used in this Attachment:

                  A.       "Agreement" shall mean that certain Sponsored
Research Agreement to which this Attachment is affixed between Emory University
("University"), and AtheroGenics, Inc. ("Sponsor"), of even date herewith.

                  B.       "License" shall mean that certain License Agreement
Between Emory University and AtheroGenics of January 1995, attached to the
Agreement as Attachment E.

                  C.       "University Patent Rights" shall mean rights in any
patent application or patent covering any University Invention made by the
University and/or the Principal Investigator during the course of the Research
Program and arising directly from the performance of said Research Program,
including any continuations, continuations-in-part, divisional applications,
reexaminations, reissued patents, substitutions, extensions, or additions
thereto, and any corresponding foreign patent applications or patents based on
such applications or patents ("University Patent Application" or "University
Patent", respectively).

                  D.       "University Technology Rights" shall mean University
rights under state and federal laws, including the laws of copyright, trade
secret, and unfair competition, in unpatented inventions, know-how, software and
other technology developed by the University and/or Principal Investigator
during the Research Program and arising directly from the performance of said
Research Program.

                  E.       "University Invention" shall mean any discovery,
concept or idea, whether or not patentable, made by the University and/or the
Principal Investigator during the Research Program, and arising directly from
the performance of said Research Program, including but not limited to
processes, methods, software, tangible research products, formulas and
techniques, improvements thereto, and know-how related thereto.

                  F.       "Joint Patent Rights" shall mean rights owned
jointly by University and Sponsor in any patent application or patent covering
any Joint Invention made by the University and/or the Principal Investigator
together with Sponsor and/or one or more employees of Sponsor during the course
of the Research Program and arising directly from the performance of said
Research Program, including any continuations, continuations-in-part, divisional
applications, reexaminations, reissue patents, substitutions, extensions, or
additions thereto and any corresponding foreign patent applications or patents
based on such applications or patents ("Joint Patent Application" or "Joint
Patent," respectively).


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                  G.       "Joint Technology Rights" shall mean University and
Sponsor rights under state and federal laws, including the laws of copyright,
trade secret, and unfair competition, in unpatented inventions, know-how,
software and other technology developed by the University and/or Principal
Investigator together with Sponsor and/or one or more employees of Sponsor
during the Research Program and arising directly from the performance of said
Research Program.

                  H.       "Joint Invention" shall mean any discovery, concept
or idea, whether or not patentable made by the University and/or the Principal
Investigator together with Sponsor and/or one or more employees of Sponsor
during the Research Program, and arising directly from the performance of said
Research Program, including, but not limited to processes, methods, software,
tangible research products, formulas and techniques, improvements thereto, and
know-how related thereto.

                  I.       "Patent Expenses and Costs" shall mean any expenses,
including attorney's fees, incurred in searching, search opinions, preparing
application, filing, prosecuting or maintaining a patent or patent application
with respect to Patent Rights in any country in which said patentor patent
application is filed.

                  J.       Capitalized terms used in this Attachment that are
not defined herein shall have the meanings ascribed to such terms in the
Agreement or the License.

         II.      Ownership: Any University Patent Rights and Technology Rights
and University Inventions, including copyrightable works (other than written
scholarly works which are the property of the author) made during the course of
the Research Program by University personnel (and not Sponsor and/or one or more
employees of Sponsor) shall be the property of University. All rights and title
to Joint Patent Rights and Technology Rights and Joint Inventions shall belong
to University and Sponsor as joint assignees and joint owners.

         III.     Patent Filing and Prosecution: University shall Promptly
notify Sponsor of any University and/or Joint Invention made during the Research
Program (which notice shall include, but is not limited to, the submission to
Sponsor of the pre-publication materials as described in Article VI of the
Agreement). In the event the University or Sponsor believes that such Invention
involves a patentable material, Sponsor shall have the first right to file the
United States Patent Application(s). Sponsor shall be primarily responsible for
all patent prosecution activities pertaining to Licensed Patents assigned solely
to University or assigned jointly to Sponsor and University. Sponsor shall, with
Emory's approval, which shall not be unreasonably withheld, select patent
counsel to prosecute all such Licensed Patents and shall provide University with
copies of all communications from patent offices, filings and correspondence
pertaining to such patent prosecution activities, in a timely manner, so as to
give University an opportunity to comment thereon prior to any responsive
filing. University shall have the right to have claims which are supported by
the specification added to an application.


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         If Sponsor chooses not to timely file or pursue patent protection or
patent maintenance for any patent application or issued patent assigned solely
to University, Sponsor shall notify University prior to abandonment in such a
manner as would allow University a reasonable period of time to take over
prosecution or maintenance of said patent application or issued patent. Such
patent application or issued patent shall then not be considered a Licensed
Patent and University shall be free, at its election, to abandon or maintain the
prosecution of such patent application or issued patent or grant rights to such
patent application or issued patent to third parties.

         If Sponsor chooses not to timely file or pursue patent protection or
patent maintenance for any patent application or issued patent assigned jointly
to Sponsor and University, Sponsor shall, upon University's request, assign its
interests in such patent application or issued patent to University. After such
assignment, such patent application or issued patent shall then not be
considered a Licensed Patent and University shall be free, at its election, to
abandon or maintain the prosecution of such patent application or issued patent
or grant rights to such patent application or issued patent to third parties.

         IV.      Cooperation: In any case given above, the non-filing party
shall use its best efforts to cooperate with the filing party in the preparation
and prosecution of any application filed, including the timely review and
execution of any papers or documents required in connection with the filing and
prosecution of the patent application.

         V.       Expenses and Costs: Sponsor shall bear all reasonable Patent
Expenses and Costs associated with the filing and prosecution of any United
States Patent Application which Sponsor files pursuant to the above.

         VI.      Foreign Filing and Prosecution: Within nine (9) months after
each United States Patent Application is filed pursuant to Paragraph 3 above,
Sponsor shall elect those foreign countries in which Sponsor, after consultation
with University, desires foreign patent protection and Sponsor shall timely file
patent applications in all foreign countries elected. If elected by University,
Sponsor shall file at least in the EPO, Canada and Japan. Sponsor shall, upon
University's request, pursue prosecution of such Licensed Patents in additional
countries at University's expense.

         The Patent Expenses and Costs relating to obtaining, issuing and
maintaining any foreign patent in all foreign countries elected, as provided
above, shall be paid by Sponsor, with reimbursement rights as described above.
If the University so requests, Sponsor shall inform the University of any
significant prosecution events in the elected foreign countries by providing
copies of all prosecution papers and soliciting input into patent office
responses where appropriate.

         VII.     License: Sponsor shall have an exclusive license to University
Patent Rights and University Technology Rights and/or University's ownership
interest in any Joint Patent Rights and Joint Technology Rights to practice any
Invention and use any technology made in the course


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of the Research Program in the Licensed Field. This license shall be bound by
the terms of the License Agreement, which is attached as Attachment E.
University Patents shall be classed as Subgroup (iii) patents as defined in the
License Agreement, and Joint Patents shall be classed as Subgroup (iv) patents.

         VIII.    Copyright Use: Subject to confidential treatment by Sponsor of
University Confidential Information that may be disclosed thereunder, University
grants Sponsor a fully paid-up, non-exclusive license under its copyrights to
make a reasonable number of copies for its internal needs, including derivative
works thereof, from any written report prepared and delivered to Sponsor in
accordance with this Agreement.


ACCEPTED AND AGREED:          Patricia K. Somers
                              ------------------------------------------------
                              ATHEROGENICS, INC.
                              By:     Dr. Patty Somers
                              Title:  Sr. Scientist


ACCEPTED AND AGREED           Nancy L. Wilkinson
                              ------------------------------------------------
                              EMORY UNIVERSITY
                              By:     Nancy L. Wilkinson
                              Title:  Assistant Vice President for Research


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                                  ATTACHMENT D
                            CONFIDENTIALITY AGREEMENT

         The undersigned, Dennis Liota, an individual ("Individual") assigned
to the Research Program, declares that he/she has read and is familiar with
Sections V. (Publicity), VI. (Publication and Academic Rights), and VII.
(Confidential Information) of the Sponsored Research Agreement dated as of
November 1 ("Agreement") by and between Emory University and AtheroGenics,
Inc. ("Sponsor"), and hereby agrees to be bound by the terms and conditions
thereof. Individual further agrees to keep confidential any Confidential
Information received from Sponsor for the term of the Agreement and for a
period of four (4) years following the termination of the Agreement, provided
that this obligation shall not apply to any information which:

         a.       was known to Individual prior to disclosure by Sponsor, as
evidenced by individual's written records; or

         b.       is, or shall become, other than by an act or omission by
Individual, generally available to the public; or

         c.       shall, by lawful means, be made available to Individual by a
third party with the right to disclose; or

         d.       is required by law to be disclosed by Individual, provided
Individual uses his/her best efforts to notify Sponsor immediately upon learning
of such requirement in order to give Sponsor reasonable opportunity to oppose
such requirement; or

         e.       Sponsor agrees in writing that it may be disclosed.


Dennis C. Liota                                      November 30, 1996
------------------------------------            -------------------------------
Individual                                      Date


WITNESSED BY:

Nancy L. Wilkinson                                   November 30, 1996
------------------------------------            -------------------------------
Witness                                         Date

Nancy L. Wilkinson
------------------------------------
name of Witness


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                                  ATTACHMENT E
                        LICENSE AGREEMENT OF JANUARY 1995


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