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                                                                   EXHIBIT 10.03

                                LICENSE AGREEMENT

                                     BETWEEN

                                EMORY UNIVERSITY

                                       AND

                                  ATHEROGENICS

[*] 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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                  This LICENSE AGREEMENT ("Agreement") is made and entered into
by and between EMORY UNIVERSITY, a nonprofit Georgia corporation with offices
located at 1380 South Oxford Road, N.E., Atlanta, Georgia 30322 ("Emory") and
ATHEROGENICS, INC. , a for profit Georgia corporation organized and existing
under the laws of the State of Georgia with offices located at 3343 Peachtree
Road, N.E., Suite 1140, East Tower, Atlanta Financial Center, Atlanta, Georgia
30326 ("AtheroGenics").

                  WHEREAS, EMORY is the assignee of all right, title, and
interest in inventions developed by employees of EMORY and is responsible for
the protection and commercial development of such inventions; and

                  WHEREAS, Russell M. Medford, Ph.D., M.D., Margaret K.
Offerman, Ph.D., M.D., R. Wayne Alexander, Ph.D., M.D., Sampath Parthasarathy,
Ph.D. and Robert Khan, Ph.D., M.D. are employees of EMORY and are named as
inventors in certain patent United States patent applications identified in
Exhibits A and B attached hereto; and

                  WHEREAS, ATHEROGENICS represents that it has the necessary
expertise and will, as appropriate, acquire the necessary resources to fully
develop, obtain approval for, and market diagnostic and therapeutic products
based upon the inventions claimed in the above referenced patent applications
and additional patent applications which the parties anticipate will be filed
after the date of this Agreement and which shall be solely assigned to EMORY or
jointly assigned to EMORY and ATHEROGENICS as described herein; and

                  WHEREAS, EMORY wants to have such inventions developed,
commercialized, and made available for use by the public.

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              NOW, THEREFORE, for and in consideration of the mutual covenants
and the premises herein contained, the parties, intending to be legally bound,
hereby agree as follows.

                            ARTICLE 1. EFFECTIVE DATE

           This Agreement shall be effective as of January 11, 1995.

                             ARTICLE 2. DEFINITIONS

              As used in this Agreement, the following terms shall have the
meanings indicated:

              2.1 "Affiliate" shall mean any corporation or non-corporate
business entity which controls, is controlled by, or is under common control
with a party to this Agreement. A corporation or non-corporate business entity
shall be regarded as in control of another corporation if it owns, or directly
or indirectly controls at least forty percent (40%) of the voting stock of the
other corporation, or (i) in the absence of the ownership of at least forty
percent (40%) of the voting stock of a corporation or (ii) in the case of a
non-corporate business entity, or non-profit corporation, if it possesses,
directly or indirectly, the power to direct or cause the direction of the
management and policies of such corporation or non-corporate business entity, as
applicable.

              2.2 "Dollars" shall mean United States dollars.

              2.3 "FDA" shall mean the United States Food and Drug
Administration or successor entity.

              2.4 "Field" shall mean the diagnosis, prevention and treatment of
human disease.

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              2.5 "IND" shall mean an Investigational New Drug application or
its equivalent.

              2.6 "Indemnitees" shall mean Emory, its directors, employees and
students, and their heirs, executors, administrators, successors and legal
representatives.

              2.7 "Licensed Patents" shall mean the following subgroups: (i) the
patent applications identified in Exhibit "A" hereof and all patents which issue
thereon ("Subgroup (i)"), (ii) pending patent applications and issued patents
described in Exhibit B, Section I (which may be amended to add patent
applications filed after the date of this Agreement) and inventions and
technical approaches described in Section II of Exhibit B which may become the
subject of claims in patent applications filed after the effective date of this
Agreement, ("Subgroup (ii)"), (iii) patent applications to be filed on
inventions conceived and reduced to practice under the Sponsored Research
Agreement between Emory and AtheroGenics of even date ("Subgroup (iii)"), and
(iv) patent applications claiming inventions co-owned by AtheroGenics and Emory
which are exclusively licensed by Emory to AtheroGenics (see section 3.2 below).
Each subgroup of Licensed Patents shall include all United States and foreign
patents which issue thereon and any and all continuations, divisionals,
extensions, reissues and reexamination patents, all continuations-in-part, and
foreign counterparts thereof which issue anywhere in the world.

              2.8 "Licensed Product" shall mean any process, service or product
comprising any composition of matter, design, discovery, improvement, invention,
process, method, structure or technique ("Invention") claimed in any Valid
Claim.

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              2.9 "Licensed Technology" shall mean all technical information and
data, whether or not patented, presently known or learned, invented or developed
by Russell M. Medford, Ph.D., M.D., Margaret K. Offerman, Ph.D., M.D., R. Wayne
Alexander, Ph.D., M.D., Sampath Parthasarathy, Ph.D., and Robert Khan, Ph.D.,
M.D. while an employee of Emory and obligated to assign rights in said technical
information and data to Emory, to the extent that (i) such technical information
and data is useful for the manufacture, use or sale of any Licensed Product and
(ii) Emory possesses the right to license the use of such information to
AtheroGenics for commercial purposes. Licensed Technology shall not include any
technical information or data invented or developed by any of the above named
persons when said person is acting as a consultant under Emory School of
Medicine Consulting Policies and is not obligated to assign technical
information or data invented or developed thereunder to Emory.

              2.10 "Licensed Subject Matter" shall mean all Licensed Patents and
Licensed Technology.

              2.11 "Licensed Territory" shall mean the world.

              2.12 "NDA" shall mean a New Drug Application or its equivalent.

              2.13 "Net Distributions" shall mean gross distributions for
products utilizing Licensed Patents and Licensed Technology from joint ventures
with AtheroGenics or an Affiliate of AtheroGenics, net of discounts, allowances,
sales or other similar taxes, rebates and returns, import and/or export duties,
and outbound transportation prepaid or allowed. Net Distributions shall be
calculated per product line incorporating Licensed Products and shall include
any funds or other valuable consideration received by AtheroGenics or an
Affiliate of AtheroGenics.

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              2.14 "Net Revenue" shall mean Net Distributions plus Sublicensee
Royalties on Licensed Products utilizing technology developed and/or
manufactured by AtheroGenics alone or through a joint venture with AtheroGenics
or an Affiliate of AtheroGenics.

              2.15 "Net Selling Price" shall mean the gross selling price paid
by a purchaser of a Licensed Product to AtheroGenics, an Affiliate or
sublicensee of AtheroGenics, or any other party (other than a joint venture in
which AtheroGenics or an Affiliate of AtheroGenics is a participant) authorized
by AtheroGenics to sell Licensed Products (net of discounts, allowances, sales
or other similar taxes, rebates and returns, import and/or export duties, and
outbound transportation prepaid or allowed) and, if applicable, the value of all
properties, rights and services received in consideration of a Sale of a
Licensed Product. Where a Sale is deemed consummated by a gift, use or other
disposition of Licensed Products for other than a selling price stated in cash,
the term "Net Selling Price" shall mean the average Net Selling Price billed by
AtheroGenics (its Affiliates, sublicensees, joint venture partners or other
third parties authorized to Sell Licensed Products) in consideration of the Sale
of comparable Licensed Products during the three (3) months immediately
proceeding such Sale.

              2.16 "Passthrough Royalties" shall mean Sublicensee Royalties
received by AtheroGenics from sublicensees wherein AtheroGenics does not develop
or manufacture the technology being sublicensed.

              2.17 "Registration" shall mean in relation to any Licensed
Product, such approvals by United States authorities such as the FDA, as may be
legally required before such Licensed Product may be commercialized or Sold in
the United States.

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              2.18 "Sale" or "Sold" shall mean the transfer or disposition by
AtheroGenics, its Affiliates, sublicensees, joint venture partners or any third
party authorized by AtheroGenics to make such transfer or disposition, of a
Licensed Product, for a selling price or other consideration to a party other
than AtheroGenics, its Affiliates, sublicensees or joint venture partners. A
Sale shall occur upon transfer of funds for a Licensed Product. A Sale shall not
include transfer of product for research, development, clinical or promotional
purposes.

              2.19 "Sublicensee Royalties" shall mean the Net Selling Price paid
by a purchaser of a Licensed Product to AtheroGenics, an Affiliate or
sublicensee of AtheroGenics, or any other party (other than a joint venture in
which AtheroGenics or an Affiliate of AtheroGenics is a participant) authorized
by AtheroGenics to sell Licensed Products.

              2.20 "Valid Claim" shall mean an issued claim of any unexpired
patent which is a Licensed Patent or claim of any pending patent application
which is a Licensed Patent, which claim has not been held unenforceable,
unpatentable or invalid by a court or governmental body of competent
jurisdiction, unappealable or unappealed within the time allowed for appeal, or
which has not been rendered unenforceable through disclaimer or otherwise and
which has not been lost through an interference proceeding.

                           ARTICLE 3. GRANT OF LICENSE

              3.1 License. Emory hereby grants AtheroGenics and its Affiliates
an exclusive right and license to make, use, sell and have sold Licensed
Products utilizing inventions claimed in Licensed Patents in Subgroup (i) , (ii)
or (iii) and to practice Licensed Technology in the Licensed Territory during
the term of this Agreement.

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              3.2 Future Option. Emory hereby grants AtheroGenics and its
Affiliates an option for an exclusive license to all of Emory's rights to
Licensed Patents of Subgroup (iv) . AtheroGenics shall pay for and prosecute
patent applications for inventions in Subgroup (iv) in a manner consistent with
its obligations under Section 9.2 of this Agreement. AtheroGenics shall have
ninety (90) days after issuance of any Valid Claim for such a Licensed Patent
within which to exercise its option for that patent. Any license of a Subgroup
(iv) Licensed Patent shall contain terms substantially similar to those
contained in this Agreement, and shall bear a running royalty rate of [*] and a
sublicense royalty rate comparable to the applicable rate for Licensed Patents
in Subgroup (iii).

              3.3 Government Rights. The license granted in Section 3.1 above is
conditional upon and subject to a nonexclusive, nontransferable, royalty free
license to the United States and other rights retained by the United States in
inventions developed by nonprofit institutions with the support of federal
funds. These rights are set forth in 35 U.S.C. ss. 201 et seq. and 37 C.F.R. ss.
401 et seq. which may be amended from time to time by the Congress of the United
States or through administrative procedures.

              3.4 Retained Licenses. The license granted in Section 3.1 and any
license to be granted under Section 3.2 above are further conditional upon and
subject to a right and license retained by Emory on behalf of itself and Emory
research collaborators to make, use and transfer (not for value) Licensed
Products and practice Licensed Technology for research and educational purposes
only. Emory shall not undertake to make, use or transfer Licensed Products or
practice Licensed Technology under the sponsorship of any for profit entity,
other than AtheroGenics, without the express written approval of AtheroGenics.

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              Emory shall have the right to publish the general scientific
findings from research related to Licensed Patents and Licensed Technology
subject to thirty (30) days prior review by AtheroGenics. Emory shall, upon
AtheroGenics' request, delete any AtheroGenics' confidential information
disclosed in such proposed publication. Emory shall also, upon the request of
AtheroGenics made within that thirty (30) day period, refrain from making such
publication for a period of time not to exceed ninety (90) days from the date of
the request, in order to afford Emory, or AtheroGenics, as applicable, an
opportunity to file a United States patent application to protect patentable
subject matter disclosed in such proposed publication.

              3.5 Sublicenses. AtheroGenics may grant sublicenses under this
license. AtheroGenics shall provide Emory with copies of all sublicense
agreements within thirty (30) days of their execution date. AtheroGenics shall
remain responsible to Emory for the payment of all fees and royalties due under
this Agreement, whether or not such payments are made to AtheroGenics by its
sublicensees. AtheroGenics shall include in any sublicense granted pursuant to
this Agreement, a provision requiring the sublicensee to indemnify Emory and
maintain liability coverage to the same extent that AtheroGenics is so required
pursuant to Section 11.3 of this Agreement.

                    ARTICLE 4. OBLIGATIONS OF EMORY EMPLOYEES

              AtheroGenics acknowledges that the founders of AtheroGenics, Drs.
R. Wayne Alexander and Russell Medford are full time employees of Emory and
their primary professional responsibilities are to Emory. Any contractual or
other relationship between AtheroGenics and Dr. Alexander and/or Dr. Medford,
for as long as they remain employees of Emory, or between,

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AtheroGenics and any other employee of Emory, whether said relationship is
created prior to or during the term of this Agreement, shall be subject to all
relevant policies of Emory, including, but not limited to, the Emory and Emory
School of Medicine Consulting Policies and the Emory Procedures for Faculty
Members involved in Sponsored Scientific Research and Technology Transfer, and
the Emory Patent and Copyright Policies as now exist, or as may be amended or
established from time to time.

                     ARTICLE 5. ROYALTIES AND OTHER PAYMENTS

              AtheroGenics shall receive income under this license as well as
Passthrough Royalties. Running royalties on Net Revenue and on Passthrough
Royalties shall be calculated in the following manner:

              5.1 Net Revenue.

                     AtheroGenics shall pay Emory the following running
royalties on Net Revenue:

              (a) [*] of the Net Revenue for Licensed Products utilizing
Inventions claimed in any Valid Claim of Licensed Patents in Subgroup (i) Sold
in the Licensed Territory; or

              (b) [*] of the Net Revenue for Licensed Products utilizing
Inventions claimed in any Valid Claim of Licensed Patents in Subgroup (ii) or
Subgroup (iii) Sold in the Licensed Territory.

              (c) In the event that a Licensed Product utilizes Inventions
claimed by Valid Claims contained in more than one Licensed Patent subgroup,
AtheroGenics shall pay the higher

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of the applicable running royalty rate, but in no case shall pay Emory or its
assigns more than [*] of the Net Selling Price for any Licensed Product.

              5.2 AtheroGenics shall pay Emory the following running royalties
on Passthrough Royalties:

              (a) [*] of the Passthrough Royalties paid to AtheroGenics, up to a
maximum of [*] of Net Selling Price, and [*] of lump sum licensing fees paid to
AtheroGenics, by a Sublicensee for Licensed Products utilizing Inventions
claimed in any Valid Claim of Licensed Patents in Subgroup (i) Sold in the
Licensed Territory; or

              (b) [*] of the Passthrough Royalties paid to AtheroGenics, up to a
maximum of [*] of Net Selling Price, and [*] of lump sum licensing fees paid to
AtheroGenics, by a Sublicensee for Licensed Products utilizing Inventions
claimed in any Valid Claim of Licensed Patents in Subgroup (ii) or Subgroup
(iii) Sold in the Licensed Territory.

              (c) In the event that a Licensed Product subject to Passthrough
Royalties utilizes Inventions claimed by Valid Claims contained in more than one
Licensed Patent subgroup, AtheroGenics shall pay the higher of the applicable
running royalty rate, but in no case shall pay Emory or its assigns more than
[*] of the Net Selling Price for any Licensed Product.

              (d) Emory shall have the right to approve any sublicense
arrangement, which approval shall not be unreasonably withheld, which
AtheroGenics or Emory reasonably anticipates will result in Passthrough
Royalties of less than [*] of the Net Selling Price for 5.2(a) or [*] of the Net
Selling Price for 5.2 (b).

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              5.3 Signing Fee. AtheroGenics shall pay Emory a signing fee in the
amount of [*] upon the execution of this Agreement.

              5.4 Milestone Payments. AtheroGenics shall pay Emory a Milestone
Payment in the amount specified below no later than thirty (30) days after the
occurrence of the corresponding event designated below.

                         Event                                Milestone Payment
                         -----                                -----------------
 (a)   The date of the first IND for a Licensed                      [*]
 Product filed by AtheroGenics, its Affiliate, or
 sublicensee becomes effective.

 (b)   Commencement Date of a Phase III Trial for                    [*]
 any Licensed Product.

 (c)   Registration of any Licensed Product.                         [*]

                        ARTICLE 6. REPORTS AND ACCOUNTING

              6.1 Royalty Reports and Records. During the term of this
Agreement, AtheroGenics shall furnish, or cause to be furnished to Emory,
written reports governing each of AtheroGenics', AtheroGenics' Affiliates and
sublicensees fiscal quarters showing:

              (a) the gross selling price of all Licensed Products Sold by
AtheroGenics, its Affiliates and sublicensees, in each country of the Licensed
Territory during the reporting period, together with the calculations of Net
Selling Price in accordance with Section 2.15; and

              (b) the royalties payable in Dollars, which shall have accrued
hereunder in respect to such Sales; and

              (c) the exchange rates, if any, used in determining the amount of
Dollars; and

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              (d) the amount of any consideration received by AtheroGenics from
sublicensees and an explanation of the contractual obligation satisfied by such
consideration; and

              (e) the occurrence of any event triggering a Milestone Payment
obligation in accordance with Section 5.4.

              Reports shall be made semiannually after the first Sale of a
Licensed Product. These royalty reports shall be due within ninety (90) days of
the close of every second and fourth AtheroGenics fiscal quarter. AtheroGenics
shall keep accurate records in sufficient detail to enable royalties and other
payments payable hereunder to be determined.

              6.2 Right to Audit. Emory shall have the right, upon prior notice
to AtheroGenics, not more than once in each AtheroGenics fiscal year, for the
period not exceeding the previous twenty four (24) months, through an
independent public accountant selected by Emory and acceptable to AtheroGenics,
which acceptance shall not be unreasonably refused, to have access during normal
business hours of AtheroGenics as may be reasonably necessary to verify the
accuracy of the royalty reports required to be furnished by AtheroGenics
pursuant to Section 6.1 of the Agreement. AtheroGenics shall include in any
sublicenses granted pursuant to this Agreement, a provision requiring the
sublicensee to keep and maintain records of Sales made pursuant to such
sublicense and to grant reasonable access to such records by Emory's independent
public accountant for the purpose of verifying the accuracy of royalty reports.
If such independent public accountant's report shows any underpayment of
royalties by AtheroGenics, its Affiliates or sublicensees, within ninety (90)
days after AtheroGenics' receipt of such report, AtheroGenics shall remit or
shall cause its sublicensees to remit to Emory:

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              (a) the amount of such underpayment; and

              (b) if such underpayment exceeds [*] of the total royalties owed
for the fiscal year then being reviewed, the reasonably necessary fees and
expenses of such independent public accountant performing the audit. Otherwise,
Emory's accountant's fees and expenses shall be borne by Emory. Any overpayment
of royalties shall be fully refunded within ninety (90) days by Emory.

              6.3 Confidentiality of Records. All information subject to review
under this Article 6 shall be confidential. Except where provided by law, Emory
and its accountant shall retain all such information in confidence.

                               ARTICLE 7. PAYMENTS

              7.1 Payment Due Dates. Royalties and sublicense fees payable to
Emory as a result of activities occurring during the period covered by each
royalty report provided for under Article 6 of this Agreement shall be due and
payable on the date such royalty report is due. Payments of royalties in whole
or in part may be made in advance of such due date. Any payment in excess of [*]
shall be made by wire or transferred to an account of Emory designated by Emory
from time to time; provided, however, that in the event that Emory fails to
designate such account, AtheroGenics or its Affiliates and sublicensees may
remit payment to Emory to the address applicable for the receipt of notices
hereunder; providing, further, that any notice by Emory of such account or
change in such account, shall not be effective until fifteen (15) days after
receipt thereof by AtheroGenics.

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               7.2 Currency Restrictions. Except as hereinafter provided in this
 Section 7.2, all royalties shall be paid in Dollars. If, at any time, legal
 restrictions prevent the prompt remittance of part of or all royalties with
 respect to any country in the Licensed Territory where Licensed Products are
 Sold, AtheroGenics or its sublicensee shall have the right and option to make
 such payments by depositing the amount thereof in local currency to Emory's
 account in a bank or depository in such country.

               7.3 Interest. Royalties and other payments required to be paid by
 AtheroGenics pursuant to this Agreement shall, if overdue, bear interest at the
 lesser of the maximum applicable legal rate of interest on overdue commercial
 accounts, or the LIBOR rate, calculated on an average daily basis over the
 period of the delinquency. The payment of such interest shall not foreclose
 Emory from exercising any other rights it may have because any payment is
 overdue.

                  ARTICLE 8. DEVELOPMENT AND MARKETING PROGRAM

              8.1 Diligence Obligations. AtheroGenics shall directly, or in
collaboration with Affiliates and sublicensees, use its best efforts:

              (a) to conduct a research and development program relating to the
use of Licensed Products in the Field; and

              (b) to promptly register Licensed Products with the FDA as
required by law.

              For purposes of this Agreement, "best efforts" shall mean that
AtheroGenics shall use reasonable efforts consistent with those used by
comparable biotechnology companies in the United States, at the same stage of
corporate and scientific development, in research and

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development projects for diagnostic methods or kits and therapeutic methods or
compositions deemed to have commercial value comparable to the Licensed
Products.

              8.2 Fulfillment; Conversion. AtheroGenics' best efforts
obligations set forth in this Article 8 shall be deemed to have been fulfilled
if AtheroGenics (a) files an IND for Registration of a Licensed Product in the
United States within three (3) years after the effective date of this Agreement;
and (b) diligently pursues such Registration by complying with all FDA
requirements and appealing, to the extent permissible by law, any decisions
taken by the FDA which would prohibit Registration; and (c) commences marketing
at least one Licensed Product within six (6) months following Registration.

              If AtheroGenics fails to meet any deadline set forth in this
Section 8.2 or use best efforts as defined in Section 8.1 of this Agreement,
Emory may, upon at least ninety (90) days' prior written notice, convert this
license from an exclusive to non-exclusive license and grant third parties
rights in Licensed Patents and/or Licensed Technology equal to or lesser rights
than rights granted to AtheroGenics for the same Licensed Patents and/or
Licensed Technology, unless within such ninety (90) day period AtheroGenics
meets such deadline or demonstrates to the reasonable satisfaction of Emory that
it has resumed and will continue to use best efforts.

              8.3 Progress Reports. AtheroGenics shall, no less frequently than
once every twelve (12) months until a Licensed Product has been Registered,
provide Emory with a written report detailing AtheroGenics', its Affiliates' and
sublicensees, activities related to developing Licensed Products and pursuing
Registration of Licensed Products.

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              8.4 Development Outside United States. No later than AtheroGenics'
filing of an NDA for a Licensed Product in the United States, AtheroGenics shall
directly, or in collaboration with Affiliates and sublicensees, use its best
efforts:

              (a) to obtain Registration for a Licensed Product in such other
countries of the Licensed Territory as AtheroGenics or AtheroGenics' Affiliates
and sublicensees deem appropriate; and

              (b) upon Registration of a Licensed Product in a particular
country proceed with due diligence to market such Licensed Product in such
country.

              8.5 Development of Indications.

              (a) AtheroGenics and Emory acknowledge that the compositions and
methods claimed in the Licensed Patents may be useful for a myriad of
indications. AtheroGenics shall, in accordance with its diligence obligations,
attempt to develop the Licensed Patents and Licensed Technology for all such
indications. However, because of the burdens, both financial and practical,
which may be accompanied by this requirement, such development is intended to be
staggered. Accordingly, AtheroGenics shall begin diligence requirements for its
second indication within [*] of the date of this Agreement, and thereafter for
one new indication at least once every [*]. Dates wherein diligence requirements
commence for a new indication shall be termed "Diligence Commencement Dates."

              (b) If AtheroGenics fails to begin using diligence to develop a
new potential indication an any Diligence Commencement Date in accordance with
Section 8.5 (a) of this Agreement, Emory may, commencing ninety (90) days after
that Diligence Commencement Date, request in writing that AtheroGenics enter
into good faith negotiations with prospective

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 sublicensees which Emory believes are interested in developing an indication
 which AtheroGenics is not developing, for the purpose of sublicensing one new
 potential indication. Within sixty (60) days of receipt of such written
 request, AtheroGenics shall (i) commence and diligently pursue good faith
 negotiations with such prospective sublicensee or (ii) provide Emory with a
 detailed development plan, including milestones, for such indication in
 accordance with diligence requirements of this Agreement.

                         ARTICLE 9. PATENT PROSECUTION

              9.1 Licensed Patents Assigned Solely to Emory. AtheroGenics shall
be primarily responsible for all patent prosecution activities pertaining to
Licensed Patents assigned solely to Emory. AtheroGenics, with the agreement of
Emory, which agreement shall not be unreasonably withheld, shall select patent
counsel to prosecute all such Licensed Patents and shall provide Emory 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 Emory an opportunity to comment thereon prior to any responsive filing.
Emory shall have the right to have claims which are supported by the
specification added to an application.

              AtheroGenics shall pursue prosecution of such Licensed Patents in
at least the following countries: United States, EPO countries, Japan and
Canada. AtheroGenics shall, upon Emory's request, pursue prosecution of such
Licensed Patents in additional countries at Emory's expense.

              If AtheroGenics chooses not to timely file or pursue patent
protection or patent maintenance for any patent application or issued patent
assigned solely to Emory, AtheroGenics

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shall notify Emory prior to abandonment in such a manner as would allow Emory 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 Emory 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.

              9.2 Licensed Patents Jointly Assigned to AtheroGenics and Emory.
AtheroGenics shall be primarily responsible for all patent prosecution
activities pertaining to Licensed Patents assigned jointly to AtheroGenics and
Emory. AtheroGenics shall select patent counsel to prosecute all such Licensed
Patents and shall provide Emory 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 Emory an opportunity to comment
thereon prior to any responsive filing. Emory shall have the right to have
claims which are supported by the specification added to an application.

              AtheroGenics shall pursue prosecution of such Licensed Patents in
at least the following countries: United States, EPO countries, Japan and
Canada. AtheroGenics shall, upon Emory's request, pursue prosecution of such
Licensed Patents in additional countries at Emory's expense.

              If AtheroGenics chooses not to timely file or pursue patent
protection or patent maintenance for any patent application or issued patent
assigned jointly to AtheroGenics and Emory, AtheroGenics shall, upon Emory's
request, assign its interests in such patent application or issued patent to
Emory. After such assignment, such patent application or issued patent shall
then not be considered a Licensed Patent and Emory shall be free, at its
election, to abandon or

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maintain the prosecution of such patent application or issued patent or grant
rights to such patent application or issued patent to third parties.

                            ARTICLE 10. INFRINGEMENT

              10.1 If either AtheroGenics or Emory becomes aware of a product
made, used or sold in the Licensed Territory, which it believes infringes a
Valid Claim, the party obtaining such knowledge shall promptly advise the other
party of all relevant facts and circumstances pertaining to the potential
infringement. AtheroGenics shall have the right to enforce any issued Licensed
Patent against such infringement, at its own expense. Emory shall cooperate with
AtheroGenics in such effort, including being joined as a party to such action,
if necessary. During the pendency of such an action, royalty rates owed by
AtheroGenics to Emory shall be reduced by fifty (50%) percent from those
listed in Article 5 of this Agreement.

              10.2 Any damages or costs recovered by AtheroGenics in connection
with any action filed by AtheroGenics hereunder shall be applied first to
reimbursing AtheroGenics for costs and expenses of such litigation. Any damages
or costs recovered by AtheroGenics in excess of costs and expenses credited
shall be the sole property of AtheroGenics. Any such excess damages or costs
shall be treated as proceeds of Sales of Licensed Products in the fiscal quarter
received by AtheroGenics, and royalties shall be payable by AtheroGenics to
Emory thereon in accordance with the terms of this Agreement.

              10.3 Any multiplication of damages for punitive purposes shall be
treated as proceeds of Sales of Licensed Products in the fiscal quarter received
by AtheroGenics, and

                                       19

<PAGE>   21

royalties shall be payable by AtheroGenics to Emory thereon in accordance with
the terms of this Agreement, and AtheroGenics shall retain all attorney fees
awarded.

              10.4 If AtheroGenics shall fail, within one hundred twenty (120)
days after receiving notice from Emory of a potential infringement, or providing
Emory with notice of such infringement, to either (a) terminate such
infringement, (b) institute sub-licensing negotiations, to be completed within a
reasonable period of time, or (c) institute an action to prevent continuation
thereof and, thereafter to prosecute such action diligently, or if AtheroGenics
notifies Emory that it does not plan to terminate the infringement, negotiate a
sub-license or institute such action, then Emory shall have the right to do so
at its own expense. AtheroGenics shall cooperate with Emory in such effort,
including being joined as a party to such action if necessary. Emory shall be
entitled to retain all damages or costs awarded to Emory in such action.

                   ARTICLE 11. REPRESENTATIONS AND WARRANTIES

              11.1 Warranty of Ownership and Right to License. Emory represents
and warrants to AtheroGenics as follows:

              (a) Right to Grant. Subject to Section 3.3 hereof, and certain
rights held by Isis Pharmaceuticals in patent application number [*], Emory
hereby represents that it has not granted to any third party, and no third party
holds, any option, license, sublicense or similar right relating to the use of
the Licensed Subject Matter within the Field. Emory further represents that it
has the right to grant the license granted hereunder to the Licensed Patents and
Licensed Technology.

                                       20

<PAGE>   22

              (b) Adversary Proceedings. There are no claims, disputes, actions,
proceedings, suits or appeals pending against Emory with respect to the Licensed
Subject Matter (other than those, if any, with respect to which service of
process or similar notice has not yet been made on Emory), and to the knowledge
of Emory, none has been threatened against Emory. To the knowledge of Emory, no
third party has infringed any of Emory's rights to use the Licensed Subject
matter in the Field.

              11.2 Exclusion of Other Warranties. Emory disclaims any warranties
of merchantability or fitness for a particular purpose and any other implied
warranties with respect to the capabilities, safety, utility, or commercial
application of the Licensed Patents, Licensed Technology or Licensed Products.

                    ARTICLE 12. INDEMNIFICATION AND INSURANCE

              12.1 No Liability. Emory shall not be liable to AtheroGenics or
AtheroGenics' Affiliates, customers or sublicensees for compensatory, special,
incidental, indirect, consequential or exemplary damages resulting from the
manufacture, testing, design, labeling, use or sale of Licensed Products.

              12.2 Indemnification. AtheroGenics shall defend, indemnify, and
hold harmless the Indemnitees, from and against any and all claims, demands,
loss, liability, expense, or damage (including investigative costs, court costs
and attorneys, fees) Indemnitees may suffer, pay, or incur as a result of
claims, demands or actions against any of the Indemnitees arising or alleged to
arise by reason of, or in connection with, any and all personal injury
(including death) and property damage caused or contributed to, in whole or in
part, by

                                       21

<PAGE>   23

AtheroGenics or AtheroGenics' Affiliates, contractors, agents, or sublicensees
manufacture, testing, design, use, Sale or labeling of any Licensed Product.
AtheroGenics' obligations under this Article shall survive the expiration or
termination of this Agreement for any reason. However, this section 12.2 shall
not obligate AtheroGenics to indemnify Emory for any claims, demands or actions
against any of the Indemnitees arising or alleged to arise by reason or, or in
connection with, any and all personal injury (including death) and property
damage caused or contributed to, in whole or in part, by Emory during any
participation by Emory in clinical testing of any Licensed Product.

              12.3 Insurance. Without limiting AtheroGenics' indemnity
obligations under the preceding paragraph, AtheroGenics shall, prior to any
clinical trial or Sale of any Licensed Product, cause to be in force, an
"occurrence based type" liability insurance policy which:

              (a) insures Indemnitees for all claims, damages, and actions
mentioned in Section 12.2 of this Agreement; and

              (b) includes a contractual endorsement providing coverage for all
liability which may be incurred by Indemnitees in connection with this
Agreement; and

              (c) requires the insurance carrier to provide Emory with no less
than thirty (30) days' written notice of any change in the terms or coverage of
the policy or its cancellation; and

              (d) provides Indemnitees product liability coverage in an amount
appropriate and customary in the industry for bodily injury and for property
damage, subject to a reasonable aggregate amount.

                                       22

<PAGE>   24

              12.4 Occurrence Based Coverage Not Available. If AtheroGenics is
unable to obtain "occurrence based type" liability insurance for a reasonable
fee, AtheroGenics shall procure "claims made type" liability coverage to be
effective prior to any clinical trial or Sale of any Licensed Patent, and
throughout the term of this Agreement and "tail coverage," extending at least
ten (10) years after termination of this Agreement. AtheroGenics shall notify
Emory prior to its first clinical trial or commercial Sale of any Licensed
Product, or all insurance coverage AtheroGenics possesses to meet AtheroGenics'
obligations under Sections 12.2 and 12.3 of this Agreement.

              12.5 Notice of claims. AtheroGenics shall promptly notify Emory of
all claims made to AtheroGenics involving the Indemnitees and shall advise Emory
of the policy amounts that might be needed to defend and pay any such claims.

                           ARTICLE 13. CONFIDENTIALITY

              13.1 Treatment of Confidential Information. During the term of
this Agreement, AtheroGenics and Emory each may disclose certain information
which the disclosing party deems to be of a confidential, proprietary and trade
secret nature. For the term of this Agreement and for a period of seven (7)
years following termination of this Agreement, AtheroGenics and Emory 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

                                       23

<PAGE>   25

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.

              Each party hereto shall 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.

              13.2 Access. Each party hereto shall 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. 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 under this Section 13.2 shall be subject to
the non-disclosure covenants contained herein.

              Each party shall 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,

                                       24

<PAGE>   26

reduce the information to writing and provide the receiving party with a copy of
such information marked as proprietary.

              13.3 Covenant Not to Use or Disclose. AtheroGenics and Emory 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.

              13.4 Return of Confidential Documents. Upon termination of this
Agreement, or forthwith upon the request of the other party, AtheroGenics and
Emory shall promptly return to the other party all such documents, drawings,
samples, specimens or reproductions thereof which may have come into its
possession.

              13.5 Proprietary Rights. AtheroGenics and Emory 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.

              13.6 Exceptions. The obligations undertaken by AtheroGenics and
Emory 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;

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

                                       25

<PAGE>   27

              (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

              (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) AtheroGenics and Emory agree in writing may be disclosed.

              In claiming the benefit of any of the exceptions set forth in this
Section 13.5, the non-disclosing party shall have the burden of establishing
that a portion of the Proprietary Information is subject to such exception.

                        ARTICLE 14. TERM AND TERMINATION

              14.1 Term. The term of this Agreement shall Commence on the
Effective Date and, unless sooner terminated as otherwise provided for in this
Agreement, shall continue in full force and effect until the expiration of the
last to expire Valid Claim. If no Valid Claim should issue within ten (10) years
of the date of this Agreement, this Agreement shall terminate on the tenth
(l0th) anniversary of its Effective Date. If such early termination occurs for
failure of a

                                       26

<PAGE>   28

Valid Claim to issue, AtheroGenics shall be entitled to continue to utilize
within the Field all inventions, data or other information described and/or
claimed in Licensed Patents and all technical information and data comprising
Licensed Technology.

              14.2 Termination. Emory shall have the right to terminate this
Agreement upon the occurrence of any one or more of the following events and
provided that Emory has given AtheroGenics the notice required in Section 14.3
of this Agreement and AtheroGenics has failed to cure the breach described in
such notice within the allotted time:

              (a) failure of AtheroGenics to make any payment required pursuant
to this Agreement within five (5) days after receipt of notice that payment is
past due; or

              (b) failure of AtheroGenics to timely issue AtheroGenics stock to
Emory in accordance with that certain Stock Purchase Agreement between Emory and
AtheroGenics of even date herewith, provided, however, that any regulatory
requirements that would prevent or delay such issuance of stock shall not be
grounds for termination; or

              (c) failure of AtheroGenics to render royalty or progress reports
to Emory as required by this Agreement within ten (10) days after receipt of
notice that the report is past due or

              (d) the institution of any proceeding by AtheroGenics under any
bankruptcy, insolvency, or moratorium law wherein AtheroGenics is the subject of
that proceeding; or

              (e) any assignment by AtheroGenics of substantially all of its
assets for the benefit of creditors; or

              (f) placement of AtheroGenics' assets in the hands of a trustee or
a receiver unless the receivership or trust is dissolved within thirty (30) days
thereafter and provided that

                                       27

<PAGE>   29

in the case of an involuntary bankruptcy proceeding, which is contested by
AtheroGenics, such termination shall not become effective until the bankruptcy
court of jurisdiction has entered an order upholding the petition; or

              (g) a decision by AtheroGenics or AtheroGenics' assignee of rights
under this Agreement to quit the business of developing or selling Licensed
Products; or

              (h) the breach by AtheroGenics of any other material term of this
Agreement.

              14.3 Exercise. Before Emory may exercise its right of termination
as defined in Section 14.2 of this Agreement, it must first provide
AtheroGenics, its trustees, receivers or assigns ("Recipients") with written
notice of default and of Emory's intent to terminate. Such notice shall include
the basis for such termination. Recipients shall have thirty (30) days after
actual receipt of such notice Within which to undertake to cure the default or
dispute the grounds for termination.

              (a) If Recipients do not dispute the grounds for termination and
undertake to cure the default within that thirty (30) day period and (a) default
is cured within that thirty (30) day period, or (b) in the instance that the
breach cannot p reasonably be cured within thirty days, if default is cured
within a reasonable period of time, Emory's notice of intent to terminate shall
cease to be effective.

              (b) If Recipients have a good faith dispute as to the grounds for
termination put forth by Emory in its notice, Recipients shall, within the
thirty (30) day period after actual receipt of notice, notify Emory that they
intend to demonstrate lack of grounds for termination. In such case, Recipients
shall have ninety (90) days following the date on which notice of breach is
actually received to either

                                       28

<PAGE>   30

demonstrate such lack of grounds to Emory's satisfaction, and optionally to file
a petition for arbitration in accordance with Article 17 of this Agreement.
During this ninety (90) day period, cure of the deficiency shall render Emory's
notice of intent to terminate ineffective.

              14.4 Termination by AtheroGenics. AtheroGenics shall have the
right to terminate this Agreement upon the occurrence of either of the following
events:

              (a) the breach of a material term of this Agreement by Emory; or

              (b) ninety (90) days after actual delivery by AtheroGenics to
Emory of written notice of AtheroGenics intent to terminate.

              14.5 Exercise. Before AtheroGenics may exercise its right of
termination pursuant to Section 14.4(a) of this Agreement it must first provide
Emory with written notice of AtheroGenics' election to terminate. Such notice
shall include the basis for such termination. Emory shall have thirty (30) days
after actual receipt of such notice within which to undertake to cure the
default or dispute the grounds for termination.

              (a) If Emory does not dispute the grounds for termination and
undertakes to cure the default within that thirty (30) day period and (a)
default is cured within that thirty (30) day period, or (b) in the instance that
the breach cannot reasonably be cured within thirty days, if default is cured
within a reasonable period of time, AtheroGenics' notice of intent to terminate
shall cease to be effective.

              (b) If Emory has a good faith dispute to the grounds for
termination put forth by AtheroGenics in its notice, Emory shall, within the
thirty (30) day period after actual receipt of notice, notify AtheroGenics that
it intends to demonstrate lack of grounds for termination. In such case, Emory
shall have ninety (90) days following the date on which notice of breach is

                                       29

<PAGE>   31

actually received to either demonstrate such lack of grounds to AtheroGenics'
satisfaction, and optionally to file a petition for arbitration in accordance
with Article i7 of this Agreement. During this ninety (90) day period, cure of
the deficiency shall render AtheroGenics' notice of intent to terminate
ineffective.

              14.6 Failure to Enforce. The failure of Emory or AtheroGenics At
any time, or for any period of time, to enforce any of the provisions of this
Agreement, shall not be construed as a waiver of such provisions or as a waiver
of the right of Emory or AtheroGenics thereafter to enforce each and every such
provision of this Agreement.

              14.7 Effect.If this Agreement is terminated as a result of
AtheroGenics' breach pursuant to Section 14.2 or in accordance with Section 14.4
(b) , AtheroGenics shall return, or at Emory's direction, destroy, all data,
writings and other documents and tangible materials supplied to AtheroGenics by
Emory.

                             ARTICLE 15. ASSIGNMENT

              AtheroGenics may grant, transfer, convey, or otherwise assign any
or all of its rights and obligations under this Agreement in conjunction with
the transfer of all, or substantially all, of the business interest of
AtheroGenics to which this Agreement relates. Emory's written consent, which
shall not be unreasonably withheld, shall be required prior to any other
assignment of AtheroGenics' rights or obligations under this Agreement.

                                       30

<PAGE>   32

                            ARTICLE 16. MISCELLANEOUS

              16.1 Legal Compliance. AtheroGenics shall comply with all
applicable federal, state and local laws and regulations relating to its
manufacture, use, Sale, labelling or distribution of Licensed Products.

              16.2 Independent Contractor. AtheroGenics' relationship to Emory
shall be that of a licensee only. AtheroGenics shall not be the agent of Emory
and shall have no authority to act for, or on behalf of, Emory in any matter for
which AtheroGenics does not have express written permission. Persons retained by
AtheroGenics as employees or agents shall not, by reason thereof, be deemed to
be employees or agents of Emory. Emory's relationship to AtheroGenics shall be
that of a licensor only. Emory shall not be the agent of AtheroGenics and shall
have no authority to act for, or an behalf of, AtheroGenics in any matter for
which Emory does not have express written permission. Persons retained by Emory
as employees or agents shall not, by reason thereof, be deemed to be employees
or agents of AtheroGenics.

              16.3 Patent Marking. AtheroGenics shall mark Licensed Products
Sold in the United States with United States patent numbers in compliance with
35 U.S.C. S 287. Licensed Products manufactured or Sold in other countries shall
be marked in compliance with the intellectual property laws in force in such
foreign countries.

              16.4 Use of Names. AtheroGenics shall obtain the written approval
of Emory prior to making use of the name of any Emory employee not also employed
by AtheroGenics, or the name Emory, for any commercial purpose. This section
16.5 shall not be construed to prevent AtheroGenics from identifying
AtheroGenics employees also employed by Emory as being affiliated with Emory.

                                       31

<PAGE>   33

              Emory shall obtain the written approval of AtheroGenics prior to
making use of the name AtheroGenics.

              16.5 Place of Execution. This Agreement and any subsequent
modifications or amendments hereto shall be deemed to have been executed in the
State of Georgia, U.S.A. This Agreement shall not become effective or binding
upon Emory until signed by its Executive Vice President in the State of Georgia,
U.S.A.

              16.6 Governing Law. This Agreement and all amendments,
modifications, alterations, or supplements hereto, and the rights of the parties
hereunder, shall be construed under and governed by the laws of the State of
Georgia and the United States of America.

              16.7 Entire Agreement. This Agreement constitutes the entire
agreement between Emory and AtheroGenics with respect to the subject matter
hereof and shall not be modified, amended or terminated except as herein
provided or except by another agreement in writing executed by the parties
hereto.

              16.8 Survival. Any promises, duties and/or obligations herein
contained, such as Articles 12 and 13, which expressly or by implication subsist
after the termination of this Agreement, shall survive such termination.

              16.9 Severability. All rights and restrictions contained herein
may be exercised and shall be binding only to the extent that they do not
violate any applicable laws and are intended to be limited to the extent
necessary so that they will not render this Agreement illegal, invalid or
unenforceable. If any provision or portion of any provision of this Agreement
shall be held to be illegal, invalid or unenforceable by a court of competent
jurisdiction, the same shall

                                       32

<PAGE>   34

be reformed to comply with applicable law or stricken if not so conformable, so
as not to affect the validity or enforceability of the remainder of this
Agreement.

              16.10 Force Majeure. Any delays in or failure of performance of
any party to this Agreement shall not constitute a default hereunder, or give
rise to any claim for damages, if and to the extent caused by occurrences beyond
the control of the party affected, including, but not limited to, acts of God,
strikes or other concerted acts of workers, civil disturbances, fires, floods,
explosions, riots, war, rebellion, sabotage, acts of governmental authority or
failure of governmental authority to issue licenses or approvals which may be
required.

                             ARTICLE 17. ARBITRATION

              Any and all disputes arising with respect to the interpretation of
this Agreement, or the parties' respective performance under or breach of the
Agreement, shall be resolved by binding arbitration at the request of either
party in Atlanta, Georgia before a panel of three (3) arbitrators in accordance
with the rules and procedures of the American Arbitration Association. The panel
shall provide the parties, in writing, findings of fact and conclusions of law
in support of any decision reached. Either party shall have the right to appeal
the decision on the grounds of gross error of law or absence of evidence to
support the facts. The foregoing arbitration provision shall not preclude either
AtheroGenics or Emory from seeking equitable relief from a court of competent
jurisdiction to protect its intellectual property from unlawful use or
disclosure.

                                       33

<PAGE>   35

                               ARTICLE 18. NOTICES

              All notices, statements and reports required to be given by one
party to the other shall be in writing and shall be deemed to have been given
upon delivery in person or, upon the expiration of five (5) days after deposit
in a lawful mail depositary in the country of residence of the party giving the
notice, registered or certified postage prepaid, and addressed as follows:

To Emory:             Emory University
                      Attn: Vincent La Terza
                      Director of Licensing and Patent Counsel
                      1440 Clifton Road, N.E.
                      RM 116 WHSCAB
                      Atlanta, GA 30322

To AtheroGenics:      AtheroGenics, Inc.
                      Attn: Michael Henos
                      3343 Peachtree Road, N.E.
                      Suite 1140, East Tower
                      Atlanta Financial Tower
                      Atlanta, GA 30326

with copies to:       Lyon & Lyon
                      Attn: Carol A. Schneider, Ph.D.
                      First Interstate World Center
                      633 West Fifth Street, Suite 4700
                      Los Angeles, CA 90071-2066

Either party hereto may change the address to which notices to such party are to
be sent by giving notice to the other party at the address and in the manner
provided above. Any notice may be given, in addition to the manner set forth
above, by telex, facsimile or cable, provided that the party giving such notice
obtains acknowledgment by telex, facsimile or cable that such notice has been
received by the party to be notified. Notice made in this manner shall be deemed
to have been given when such acknowledgment has been transmitted.

                                       34

<PAGE>   36

              IN WITNESS WHEREOF, Emory and AtheroGenics have caused this
Agreement to be signed by their duly authorized representatives as of the day
and year indicated below.

EMORY UNIVERSITY:                              ATHEROGENICS:

By: John L. Temple                             By: Michael Henos
   ------------------------------------           ------------------------------

Name:    John Temple                           Name:   Michael Henos

Title:   Executive Vice President              Title:  Chairman of the Board

Date:  1/13/95                                  Date:  1-23-95
     ----------------------------------             ----------------------------

                                       35

<PAGE>   37

                                    EXHIBIT A

[*]

                                       36

<PAGE>   38

                                    EXHIBIT B

SECTION 1 - -  PENDING APPLICATIONS

        1.     [*]

SECTION 2 - -  INVENTIONS AND CONCEPTS

        1.     [*]

        2.     [*]

        3.     [*]

        4.     [*]

                                       37<PAGE>   1
                                                                   Exhibit 10.04

                            PATENT PURCHASE AGREEMENT

         THIS PATENT PURCHASE AGREEMENT (this "Agreement") is made this 26th day
of April, 1995, by and between Sampath Parthasarathy, Ph.D., a resident of
Georgia ("Seller") and AtheroGenics, Inc., a Georgia corporation ("Buyer").

                                   WITNESSETH:

         WHEREAS, Seller is the inventor of that certain United States Patent
No. 5,262,439 for "Soluble Analogs of Probucol" issued on November 16, 1993 (the
'439 patent) and corresponding foreign applications and patents (the "Patents").

         WHEREAS, Seller previously granted all right, title and interest to the
Patents to The Regents of the University of California ("U.C.") and U.C. has
returned to Seller all of its right, title and interest to the Patents for
consideration in part of [*] (the "Return Price"); and

         WHEREAS, the Patents are subject to a License to the United States
Government executed on March 27, 1995 (the Government License) by virtue of
funding provided by the Department of Health and Human Services for work
incorporated in the Patents; and

         WHEREAS, Buyer wishes to obtain all right, title and interest, other
than rights conferred in the Government License, to the Patents and the
inventions covered by the Patents from Seller and Seller desires to transfer the
Patents to Buyer;

         NOW, THEREFORE, for good and valuable consideration, the receipt of
which is hereby acknowledged, the parties hereto agree as follows:

         1. BUYER'S ACQUISITION OF THE PATENT.

         (a) Seller shall sell and assign all of its right, title and interest
to the Patents to Buyer pursuant to the Assignment of Patents attached hereto as
Exhibit "A".

         (b) In full consideration of Seller's sale and transfer of the Patents
in accordance with Section 1(a), Buyer shall (i) pay Seller an amount equivalent
to the Return Price, (ii) make the payment set forth in Section 1(c) below, and
(iii) make the royalty payments to Seller set forth in Section 2.

         (c) Upon consummation of the transactions contemplated herein, not
including periodic royalty payments, Buyer shall reimburse Seller (or pay on
behalf of Seller) up to [*] of any of the fees charged by Holtzmann, Wise &
Shepard for services performed for Seller in connection with the transactions
contemplated herein, including the reacquisition of Patents by Seller from U.C.

         [*] 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.

<PAGE>   2

         2. ROYALTY PAYMENTS TO SELLER.

         (a) In consideration of Seller's sale and assignment of the Patents to
Buyer, Buyer shall pay Seller for the period beginning on the Closing Date and
extending until the last to expire valid claim in the jurisdiction where the
patent is enforceable ("Term") a royalty of [*] of the gross selling price paid
to Buyer by a purchaser of any process, service or product in which any one of
claimed inventions of the Patents is utilized as a necessary component net of
any discounts, allowances, taxes, rebates, returns, import or export duties and
transportation prepaid or allowed.

         (b) Royalty payments shall be made by Buyer to Seller on a semiannual
basis on January 1 and July 1 of each year during the Term and Buyer shall
provide Seller with an accounting of all sales of products in respect of the
Patents upon Seller's request. All records and books of account with respect to
the Patents shall be available at all reasonable times at the principal office
of Buyer for inspection by Seller not more than twice per year.

         3. IMPROVEMENTS ON PATENT.

         (a) Rights to all improvements made relating to inventions claimed in
the Patents ("Improvements"), which Improvements are made by Seller, shall be
covered by that certain Patent, Copyright and Noncompetition Agreement of even
date.

         (b) All Improvements made by Buyer shall become the exclusive property
of Buyer, and Seller shall not be entitled to any royalty payments with respect
to such Improvements.

         4. REPRESENTATIONS AND WARRANTIES OF SELLER.

         The Representations and Warranties of Seller shall survive the
Assignment of the Patents.

         (a) Seller represents that to the best of his knowledge he has full
power and authority to execute, deliver and perform this Agreement and that the
provisions of this Agreement do not conflict with any other agreement to which
Seller is a party or by which Seller is bound.

         (b) Seller is the sole and exclusive owner of the Patents, subject to
the Government License, and has the unrestricted right to sell and assign the
Patents to Buyer.

         (c) No claim has been asserted against Seller by any person which
challenges or questions the ownership or validity of the Patents or
effectiveness of any of the claimed inventions of the Patents and to the
knowledge of Seller the making, using or selling of any of the claimed
inventions of the Patents or the know-how in connection therewith does not
infringe in any respect on the rights of any person or entity.

                                       2
<PAGE>   3

         (d) Other than the Government License, Seller has not assigned any
interest or right to obtain an interest in the Patents to anyone other than
Holder.

         (e) Seller is the true, sole inventor of the inventions claimed in the
Patents.

         5. CONDITIONS TO BUYER'S OBLIGATIONS. Buyer's obligations hereunder
shall be subject to the satisfaction of the following conditions:

         (a) The representations and warranties made by Seller herein shall be
true and correct as of the date hereof and as of the Closing Date with the same
force and effect as though said representations and warranties had been made on
and as of the Closing Date and Seller shall have complied with all of the
covenants and agreements required to be performed by Seller on or prior to the
Closing Date.

         (b) Seller shall have executed and delivered to Buyer the Consulting
Agreement attached hereto as Exhibit "B" along with any other agreement required
thereby.

         (c) All actions taken by Seller in connection with the transactions
contemplated by this Agreement and all documents and papers relating to such
transactions shall be satisfactory to Buyer, and Seller shall have delivered to
Buyer a certificate, dated as of the Closing Date, certifying that the
conditions set forth in Section 5(a) and Section 5(b) have been satisfied.

         6. MISCELLANEOUS.

         (a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the heirs, personal representatives, successors and permitted
assigns of the parties hereto.

         (b) This Agreement is not assignable by Seller without the prior
written consent of the other party. Any amendments to this Agreement shall be in
writing and shall be signed by both parties.

         (c) Any notice or other communication required or permitted to be given
under this Agreement shall be in writing and shall be mailed by certified or
registered mail, return receipt requested, or sent by facsimile, or by overnight
courier or express mail service:

         If to Seller:

                           Sampath Parthasarathy, Ph.D.
                           Emory University School of Medicine
                           Department of Gyn-Ob
                           P.O. Box 21246
                           Atlanta, GA 30322

                                       3
<PAGE>   4

         with a copy to:

                           Holtzmann, Wise & Shepard
                           3030 Hansen Way, Suite 100
                           Palo Alto, CA 94304-1006
                           Attention: Thomas Barton, Esq.

         If to Buyer:

                           AtheroGenics, Inc.
                           3343 Peachtree Road, N.E.
                           Suite 1140, East Tower
                           Atlanta, Georgia 30326
                           Attention: President

         with a copy to:

                           Lyon & Lyon
                           First Interstate World Center
                           633 West Fifth Street, Suite 4700
                           Los Angeles, CA 90071-2066
                           Attention: Carol A. Schneider, Ph.D

All notices given shall be deemed effective upon receipt or if mailed the
earlier of receipt or 5 days after mailing. A change of address is effective
when given by one party to the other party in writing pursuant to the notice
provisions of this Section 6(c).

         (d) This Agreement is executed by Buyer in, and shall be construed in
accordance with and governed by the laws of, the State of Georgia without giving
effect to the principles of conflicts of law thereof.

         (e) This Agreement may be executed in one or more counterparts, each of
which shall for all purposes be deemed to be an original, and all of which shall
constitute the same instrument.

         (f) This Agreement (including the Exhibits hereto) constitutes the sole
understanding of the parties with respect to the subject matter hereof;
provided, however, that this provision is not intended to abrogate any other
written instrument or agreement between the parties executed with or after this
Agreement.

         (g) Each party hereto agrees to do all acts and to make, execute and
deliver such written instruments as from time to time shall reasonably be
required to carry out the terms and provisions of this Agreement. Furthermore,
Seller shall, at any time after the date hereof, take all actions necessary to
apply for and to obtain Letters Patent or other comparable legal protection if

                                       4
<PAGE>   5

before Closing, or assist Buyer in applying for and obtaining Letters Patent or
other legal protection if after Closing in any additional jurisdiction upon
Buyer's request and at Buyer's expense.

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

Sampath Parthasarathy
----------------------------------
Sampath Parthasarathy, Ph.D.

ATHEROGENICS, INC.

R Wayne Alexander
----------------------------------
By: R Wayne Alexander, M.D., Ph.D.
President

                                       5
<PAGE>   6

                                   ASSIGNMENT

                  WHEREAS THE REGENTS OF THE UNIVERSITY OF CALIFORNIA, a
corporation duly organized under and pursuant to the laws of CALIFORNIA, and
having its principal place of business at 300 Lakeside Drive, 22nd Floor,
Oakland, California 94612-3550 (hereinafter referred to as the assignor) is the
owner of the invention entitled "SOLUBLE ANALOGS OF PROBUCOL" set forth in
United States Patent Number 5,262,439 issued on November 16, 1993; and

                  WHEREAS SAMPATH PARTHASARATHY, Emory University Department of
GYN OB, P.O. Box 21246, Atlanta, GA 30322, (hereinafter referred to as the
assignee), desires to acquire the entire right, title and interest in and to
said inventions and said Letters Patent of the United States, and in and to any
Letters Patent or Patents, United States or foreign, to be obtained therefor and
thereon;

                  NOW THEREFORE, for good and valuable consideration, the
receipt of which is hereby acknowledged, said assignor does sell, assign,
transfer and set over to assignee, his successors, legal representatives and
assigns, its entire right, title and interest in and to the above mentioned
inventions, Letters Patent, and any and all Letters Patent or Patents in the
United States of America and all foreign countries which may be granted therefor
and thereon, and to any and all divisions, continuations, continuations-in-part,
reissues and extensions, and all its rights under the International Convention
for the Protection of Industrial Property, the same to be held and enjoyed by
said assignee to the full end of the term or terms for which Letters Patent or
Patents may be granted, as fully and entirely as the same would have been held
and enjoyed by the assignor, had this sale and assignment not been made.

<PAGE>   7

                  ASSIGNOR hereby covenants that no assignment, sale, agreement
or encumbrance has been or will be made or entered into which would conflict
with this Assignment.

                  ASSIGNOR hereby authorizes and requests the Commissioner of
Patents and Trademarks to record this Assignment for said Letters Patent or any
legal equivalent thereof in the name of ASSIGNEE, his successors and assigns, in
accordance with this Assignment.

                  WITNESS MY HAND AT Alameda California, this 25th day of
January, 1995.

                                          THE REGENTS OF THE UNIVERSITY OF
                                          CALIFORNIA

                                          By: Linda S Stevenson
                                             ------------------------------
STATE OF CALIFORNIA            )
                               )          SS.
COUNTY OF ALAMEDA              )

         On this 25th day of January, 1995, before me, Jerina A. Labat a Notary
Public, personally appeared Linda S. Stevenson, proved to me on the basis of
satisfactory evidence to be the person whose name is subscribed to this
instrument, and acknowledged that he executed the same in his authorized
capacity, and that by his signature on the instrument the person, or the entity
upon behalf of which the person acted, executed the instrument. Witness my hand
and official seal.

                                                       Jerina A. Labat
                                               --------------------------------
                                               Notary Public in and for
                                               said County and State

                                       2
<PAGE>   8

                     LICENSE TO THE UNITED STATES GOVERNMENT

Invention Title: Soluble Analogs of Probucol

Inventor(s):      Sampath Parthasarathy

Patent or Application Serial No:            5,262,439

U.S. Filing/Issue Date:  Issued November 16, 1993

Grant/Contract Identification No: HL 14197

Foreign Applications filed/intended in (countries): Canada, EPO, Japan

The invention identified above is a Subject Invention under 35 U.S.C. 200, et
seq., and the Standard Patent Rights clause at 37 CRF 401.13 or FAR 52.227-11,
which are included among the terms of the above-identified grant/contract award
from the Public Health Service/National Institutes of Health. This document is
confirmatory of:

         1.       The nonexclusive, nontransferable, irrevocable, paid-up
                  license granted to the Federal Government in the invention
                  described in the patent application and in any of all
                  divisions, continuations, and continuations in part, and in
                  any and all patents and re-issues granted thereon; and

         2.       All other rights acquired by the Government by reason of the
                  above identified grant/contract award and the laws and
                  regulations which are applicable to the award.

The Government is hereby granted an irrevocable power to inspect and make copies
of the above-identified patent application.

         Signed this 27 day of March, 1995.

         By: /s/ Sampath Parthasarathy
             ---------------------------------
                  [Inventor(s) Name]

         Street Address: 2958 North Brook Drive, Atlanta
                        --------------------------------
         City, State, & Zip Code: Atlanta, GA 30340
                                  -----------------

<PAGE>   9

                                 April 26, 1995

Sampath Parthasarathy, Ph.D.
Emory University School of Medicine
Department of Gyn-Ob
P.O. Box 21246
Atlanta, GA 30322

Dear Dr. Parthasarathy:

         AtheroGenics, Inc., a Georgia corporation (the "Company"), desires to
obtain your services as a consultant in the field of atherogenesis and the
chemistry and biology of oxidation reactions and their inhibitors, to assist and
advise the Company in connection with its efforts of researching, developing,
marketing and worldwide promotion of prescription pharmaceuticals for the
treatment of atherosclerosis and other inflammatory diseases through regulation
of intracellular redox pathways (the "Business"). As part of your services as a
consultant, the Company desires that you become a member of its Scientific
Advisory Board. Subject to the Assignment of Patents by you to the Company
pursuant to that certain Patent Purchase Agreement, dated as of April 26, 1995,
between you and the Company (the "Patent Purchase Agreement"), you agree to
provide such consulting services and to serve on the Company's scientific
Advisory Board in accordance with the following terms and conditions:

1.       SERVICES:

         a.       CONSULTING SERVICES. You agree to devote up to eight (8) hours
                  per month providing services as a consultant to the Company in
                  connection with the Business. Such services shall be performed
                  during regular business hours at times reasonably agreeable to
                  you and the Company and shall consist of such duties and
                  responsibilities as are assigned to you by the Board of
                  Directors of the Company.

         b.       SCIENTIFIC-ADVISORY BOARD. As part of your services as a
                  consultant, you agree to serve on the Company's Scientific
                  Advisory Board. There is currently no formal schedule
                  established for meetings of the Scientific Advisory Board but
                  it is anticipated that the Scientific Advisory Board will meet
                  a minimum of six (6) days per year.

2.       COMPENSATION.

         a.       CASH COMPENSATION AND EXPENSE REIMBURSEMENT.

                  i.       As sole and exclusive compensation for your services
                           hereunder, the Company shall pay you Twelve Thousand
                           Dollars ($12,000) per year for your consulting
                           services and for serving on the Scientific Advisory
                           Board.

<PAGE>   10
Sampath Parthasarathy, Pd.D.
April 26, 1995
Page 2

                           For our respective conveniences, the compensation
                           shall be paid to you at the rate of $1000 per month.

                  ii.      In addition, you shall be reimbursed for any air
                           travel (economy class) necessary and requested by the
                           Company, and all reasonable living expenses,
                           including, but not limited to, car rental, meals, and
                           lodging incurred by you when associated with the
                           rendering of your services at locations away from
                           your home or from Atlanta, Georgia. The Company shall
                           make all payments to you in accordance with this
                           paragraph within thirty (30) days of receipt of an
                           invoice from you itemizing your travel expenses,
                           including receipts for incidental expenses in excess
                           of $25.00. Your invoices shall be mailed to the
                           Company at 3343 Peachtree Road, N.E., Suite 1140,
                           East Tower, Atlanta, Georgia 30326, Attention:
                           President.

                  iii.     All payments, including reimbursements for actual
                           expenditures, shall be, included in your gross income
                           as compensation for services rendered and accordingly
                           reported on your IRS Form 1099. You shall be
                           responsible for payment of all taxes including Social
                           Security taxes on income earned under this Agreement
                           as none will be withheld by the Company. You shall
                           indemnify AtheroGenics for any claims made by
                           federal, state or local tax agencies as a result of
                           your failure to pay taxes, fees, withholding, or the
                           like.

         b.       COMMON STOCK OF THE COMPANY.

                  i.       As additional compensation for your services
                           performed under this Agreement, and as an incentive
                           to help make the Company successful, you will be
                           issued 40,000 shares of Common Stock of the Company
                           upon your execution and delivery of this Agreement
                           and the simultaneous closing of the sale of United
                           States Patent No. 5,262,439 and corresponding foreign
                           applications and patents pursuant to the Patent
                           Purchase Agreement. Simultaneous with your acceptance
                           of this Agreement, you will enter into a Stock
                           Restriction Agreement between you and the Company
                           (the "Stock Restriction Agreement") in the form
                           attached hereto as Exhibit "I". If this Agreement is
                           terminated by the Company for cause (which shall be
                           the willful breach by you of this Agreement) or by
                           you (other than for death or disability) pursuant to
                           Paragraph 4 prior to the end of the term provided

<PAGE>   11
Sampath Parthasarathy, Pd.D.
April 26, 1995
Page 3

                           herein, you shall be entitled only to the Vested
                           Shares as defined in the Stock Restriction Agreement.

                  ii.      The Stock is being acquired by you solely for your
                           account, for investment, with no present intention of
                           making a public distribution thereof within the
                           meaning of the Securities Act. None of the Stock will
                           be sold or transferred by you in violation of the
                           Securities Act or any state securities law, and your
                           financial condition is such that this investment can
                           be made on a long-term basis and you can afford the
                           complete loss of the investment. You are aware that
                           none of the Stock has been registered under the
                           Securities Act or any state securities law, that the
                           Stock must be held indefinitely unless they are
                           subsequently registered or an exception from such
                           registration is available and that the Company is
                           under no obligation to register any of the Stock
                           under the Securities Act or any state securities law.
                           You are aware that an exception from registration
                           requirements of the Securities Act pursuant to Rule
                           144 thereunder is not presently available; that the
                           Company has not covenanted to make available an
                           exception from the registration requirements pursuant
                           to such Rule 144 or any successor rule for resale of
                           any of the Stock; and that even if any exemption
                           under Rule 144 were available, the Rule permits only
                           routine sales of securities in limited amounts in
                           accordance with the terms and conditions of such
                           Rule. You further acknowledge that there is presently
                           no market for the purchase and sale of any of the
                           Stock.

                  iii.     You confirm that the Company has made available to
                           you, or to your representatives, the opportunity to
                           ask questions of its officers and directors and to
                           acquire such additional information about the
                           business and financial condition of the Company as
                           you request. You are not acquiring and will not
                           acquire the Stock based upon representations, oral or
                           written, by any person with respect to the future
                           value of, or income from, such Stock but rather upon
                           your independent examination and judgment as to the
                           prospects of the Company, You have all requisite
                           legal power to enter into this Agreement, to acquire
                           the Stock and carry out and perform your other
                           obligations under the terms of this Agreement.

3.       INDEPENDENT CONTRACTOR.

         It is agreed that you are to have complete freedom of action as to the
         details, methods and means of performing these services. It is further
         understood that you are retained and

<PAGE>   12
Sampath Parthasarathy, Pd.D.
April 26, 1995
Page 4

         have contracted with the Company only for the purposes and to the
         extent set forth in this Agreement, and your relation to the Company
         and any of its affiliates shall, during the period of your retainer and
         service, be that of an independent contractor. Except as otherwise
         provided herein, you shall not be considered under the provisions of
         this agreement or otherwise as having status as an employee of the
         Company, nor shall you be entitled hereafter to participate in any
         plans, arrangements, or distributions by the Company relating to any
         pension, deferred compensation, bonds, stock bonus, stock option,
         hospitalization, insurance, or other benefits extended to its employees
         since you are performing services as an independent contractor.

4.       CONTRACT PERIOD.

         This Agreement becomes effective on the date set forth above your
         signature and will continue in effect for four (4) years.
         Notwithstanding the foregoing, either you or the Company may terminate
         this Agreement at any time and for any reason during its term by giving
         at least one (1) month's written notice. This Agreement shall
         automatically extend for consecutive twelve (12) month periods subject
         to the rights of the parties to terminate this Agreement as provided
         herein.

5.       INVENTIONS.

         You agree that inventions made during the course of this Agreement
         shall be subject to the terms of that certain Patent, Copyright and
         Nondisclosure Agreement dated as of April 26, 1995 (the "Patent,
         Copyright and Nondisclosure Agreement").

6.       NON-DISCLOSURE: CONFLICT OF INTEREST.

         Simultaneous with your acceptance of this Agreement, you will enter
         into the Patent, Copyright and Nondisclosure Agreement in the form
         attached hereto as Exhibit "2".

7.       GENERAL CONDITIONS.

         a.       If any provision of this Agreement shall be declared invalid,
                  illegal or unenforceable, such provision shall be severed and
                  all remaining provisions shall continue in full force and
                  effect.

         b.       The term, the Company, as used herein, shall include any
                  subsidiary or affiliate of the Company.

<PAGE>   13
Sampath Parthasarathy, Pd.D.
April 26, 1995
Page 5

         c.       This Agreement shall be binding upon you, your heirs,
                  executors, assigns and administrators and shall inure to the
                  benefit of the Company, its successors and assigns.

         d.       This Agreement shall be governed by and construed in
                  accordance with the laws of the State of Georgia.

8.      PRIOR AGREEMENTS.

         This Agreement shall replace all prior agreements between you and the
         Company relative to your services as a consultant, and this Agreement
         along with the Patent Purchase Agreement, the Stock Restriction
         Agreement and the Nondisclosure Agreement, contain the entire
         understanding between you and the Company regarding your relationship
         with the Company. This Agreement shall be amended only in writing
         agreed to by both parties and shall not be assignable by you or by
         operation of law.

         Please indicate your acceptance of the foregoing by signing in the
space provided below and returning one original letter to my attention.

                                                Sincerely,

                                                 R. Wayne Alexander
                                                 ---------------------------
                                                 R. Wayne Alexander, A.D., Ph.D.
                                                 President
                                                 AtheroGenics, Inc.

Accepted and agreed to this
26th day of April, 1995.

/s/ Sampath Parthasarathy, PH.D
-------------------------------
Sampath Parthasarathy, Ph.D.

Social Security No.[*]

<PAGE>   14
                               ATHEROGENICS, INC.

                           STOCK RESTRICTION AGREEMENT

                  THIS STOCK RESTRICTION AGREEMENT (this "Agreement") is made
and entered into as of April 26, 1995 by and between ATHEROGENICS, INC. a
Georgia corporation (the "Company"), and Sampath Parthasarathy, Ph.D., a
resident of Georgia ("Stockholder").

                                R E C I T A L S:

         A. Stockholder is being issued as of the date hereof forty thousand
(40,000) shares of the Common Stock of the Company (the "Shares") in connection
with that certain Patent Purchase Agreement of even date herewith (the "Patent
Purchase Agreement") and that certain Consulting Agreement dated of even date
herewith (the "Consulting Agreement"). As used herein, the term "Shares" refers
to all such shares presently held by the Stockholder and to all securities
purchased or otherwise received in addition thereto or in replacement thereof,
pursuant to or in consequence of any stock dividend, stock split,
recapitalization, merger, reorganization, exchange of shares or other similar
event.

         B. The Company is party to Series A Convertible Preferred Stock
Agreement (the "Purchase Agreement") dated as of May 6, 1994 with Alliance
Technology Ventures, L.P. ("Alliance") pursuant to which the Company issued to
Alliance the Company's Series A Convertible Preferred Stock. All capitalized
terms in this Agreement shall have the meanings ascribed to such terms in the
Purchase Agreement unless otherwise defined herein.

                  In order to provide assurance to Alliance and other persons
who may purchase or otherwise require shares of the Series A Convertible
Preferred Stock (the "Preferred Stock") of the Company in the future
(collectively, the "Investors") and thereby to assist in future equity
financings of the Company, Stockholder is willing to enter into this Agreement
for the benefit of the Company, the Investors and any other person or entity who
holds stock of the Company from time to time.

         THE PARTIES AGREE AS FOLLOWS:

         1. THE COMPANY'S RIGHT TO REPURCHASE UPON TERMINATION OF EMPLOYMENT.

                  1.1. REPURCHASE RIGHT. The unvested Shares, regardless of
ownership, shall be subject to a right (but not obligation) of repurchase in
favor of the Company (the "Right of Repurchase") at the price set forth below
("Purchase Price"), if the Stockholder's consultancy with the Company is
terminated by Stockholder other than for death or disability or by the Company
for cause which shall be the willful breach of the Consulting Agreement (the
"Consultancy Termination") before the Right of Repurchase expires with respect
to such Shares in accordance with Schedule 1.1. The Purchase Price shall be ten
cents (10(cent)) per Share for those

<PAGE>   15

40,000 Shares transferred in connection with the Patent Purchase Agreement and
the Consulting Agreement. The Stockholder may not dispose of or transfer or
pledge or grant a security interest in any Shares which are subject to the Right
of Repurchase and any such attempted transfer shall be null and void. The
Company's rights under this Section 1.1 shall be freely assignable, in whole or
in part.

                  1.2. REPURCHASE PROCEDURE. The Company's Right of Repurchase
shall terminate if not exercised by written notice from the Company to the
Stockholder within sixty (60) days from the date on which the Company learns of
the Consultancy Termination. If the Company exercises its Right of Repurchase,
the Stockholder shall promptly endorse and deliver to the Company the stock
certificates representing the Shares being repurchased free and clear of any
liens, claims or encumbrances, and the Company shall then pay promptly (but in
no event later than sixty (60) days after the date of Consultancy Termination,
or five (5) days after return of the stock certificate, whichever is later,
pursuant to the provisions of Section 1.3 of this Agreement, the total Purchase
Price to the Stockholder.

                  1.3. REPURCHASE PAYMENT. If, at the time of the repurchase,
any notes are outstanding which represent any portion of the total Purchase
Price for Shares being so repurchased, the Purchase Price shall be paid first by
cancellation of any obligation for accrued but unpaid interest under such notes,
next by cancellation of principal under such notes, and finally by payment of
cash or check.

                  1.4. BINDING EFFECT. The Company's Right of Repurchase shall
inure to the benefit of the successors and assigns of the Company and shall be
binding upon any representative, executor, administrator, heir, successor,
assignee or legatee of the Stockholder.

                  1.5. For purposes of this Article I and Article 2 below, if
Stockholder is also a member of the Board of Directors of the Company, the
Stockholder shall abstain from voting in regard to Company's Right of Repurchase
or Right of First Refusal (as that term is defined below).

         2. COMPANY'S RIGHT OF FIRST REFUSAL RESPECTING SHARES.

                  2.1. RIGHT OF FIRST REFUSAL. Without derogation of any
provisions of Section 1, and except as provided by Section 2.5 of this
Agreement, and if and to the extent Stockholder is allowed to sell under
applicable Securities laws which may restrict Stockholder's ability to sell,
pledge or otherwise transfer, in the event that the Stockholder proposes to
sell, pledge, or otherwise transfer any Shares or any interest in such Shares to
any person or entity, the Company shall have a right of first refusal (the
"Right of First Refusal") with respect to such Shares. Stockholder shall give a
written notice (the "Transfer Notice") to the Company describing fully any
proposed transfer of Shares, including the number of Shares proposed to be
transferred, the proposed transfer price, and the name and address of the
proposed transferee. The Transfer Notice shall be signed both by the Stockholder
and by the proposed transferee. The Company shall have the right to purchase
all, but not less than all, of the Shares subject to the Transfer

                                       2
<PAGE>   16

Notice at the same price and on the same terms as those indicated in the
Transfer Notice by delivery of a notice of exercise of the Company's Right of
First Refusal within thirty (30) days after the date the Transfer Notice is
delivered to the Company (the "Repurchase Period"). The Company's rights under
this Section 2.1 shall be freely assignable, in whole or in part. For purposes
of this Agreement, a transfer of Shares or any interest in Shares to an inter
vivos revocable trust which does not allow for the disposition of these Shares
except upon Stockholder's death and then only to Stockholder's immediate family
members, or transfer of Shares or any interest in Shares via a testimentary
instrument to Stockholder's immediate family members, shall not be considered a
transfer. However, subsequent sales, pledges or other transfers of any Shares or
interest in Shares shall be subject to this Right of First Refusal.
Notwithstanding anything to the contrary, any Shares so transferred shall be
subject to all limitations and restrictions of Section 1.1.

                  2.2. TRANSFER OF SHARES. If the Company fails to exercise the
Right of First Refusal within the Repurchase Period, the Stockholder, may, not
later than ninety (90) days following delivery to the Company of the Transfer
Notice, conclude a transfer of the Shares subject to the Transfer Notice on the
terms and conditions described in the Transfer Notice. Any proposed transfer on
terms and conditions different from those described in the Transfer Notice, as
well as any subsequent proposed transfer by the Stockholder, shall again be
subject to the Right of First Refusal and shall require compliance by the
Stockholder with the procedure described in Section 2.1 of this Agreement. If
the Company exercises the Right of First Refusal, the parties shall consummate
the sale of shares on the terms set forth in the Transfer Notice; provided,
however, in the event the Transfer Notice provides for payment for the Shares
other than in cash, the Company shall have the option of paying for the Shares
by the discounted cash equivalent of the consideration described in the Transfer
Notice.

                  2.3. BINDING EFFECT OF RIGHT OF FIRST REFUSAL. The Company's
Right of First Refusal shall inure to the benefit of the successors and assigns
of the Company and shall be binding upon any transferee of Shares other than a
transferee acquiring Shares in a bona fide arms-length transaction where the
Company failed to exercise the Right of First Refusal (a "Free Transferee"), or
a transferee of a Free Transferee.

                  2.4. TERMINATION OF THE COMPANY'S RIGHT OF FIRST REFUSAL.
Notwithstanding anything in this Section 2, the Company shall have no Right of
First Refusal, and Stockholder shall have no obligation to comply with the
procedures in Sections 2.1 through 2.3 after the earlier to occur of (i) the
Company's initial registered public offering of Common Stock to the public, or
(ii) the date ten (10) years after the date of this Agreement.

                  2.5. LIMITATIONS TO RIGHTS. Without regard and not subject to
the provisions of Sections 2.1 and 3.1, the Stockholder may sell or otherwise
assign for consideration Shares to any or all of his ancestors, descendants,
spouse, or members of his immediate family, or to a custodian, trustee
(including a trustee of a voting trust), executor, or other fiduciary for the
account of his ancestors, descendants, spouse, or members of his immediate
family, provided that each such transferee or assignee, prior to the completion
of the sale, transfer, or assignment, shall

                                       3
<PAGE>   17

have executed documents assuming the obligations of the Stockholder under this
Agreement with respect to the transferred securities.

         3. RIGHTS OF CO-SALE.

                  3.1. THE RIGHTS OF INVESTORS. Following the Repurchase Period,
if at any time Stockholder proposes to sell any Shares to parties other than the
Investors in a transaction (the "Transaction") not registered under the Act in
reliance upon a claimed exemption thereunder, then to the extent the Company has
not exercised its Right of First Refusal as to any Shares being sold, any
Investor which notifies the Company in writing, within thirty (30) days after
receipt of the notification from the Stockholder referred to in Section 3.2 (a
"Selling Holder") shall have the opportunity to sell a pro rata portion of
Shares which the Stockholder proposes to sell to such third party in the
Transaction; whereupon the Stockholder shall assign so much of his interest in
the agreement of sale as the Selling Holder shall be entitled to and shall
request hereunder, and the Selling Holder shall assume such part of the
obligations of the Stockholder under such agreement as shall relate to the sale
of the Shares by the Selling Holder. For the purposes of this Section 3, the
"pro rata portion" which the Selling Holder shall be entitled to sell shall be
an amount of shares equal to the total amount of Shares proposed to be sold
multiplied by a fraction, the numerator of which is the number of shares of
Common Stock issuable upon conversion of the Preferred Stock and shares of
Common Stock owned by a Selling Holder, and the denominator of which is the
total number of such shares owned by all participating Selling Holders and the
Stockholder. Each Selling Holder shall notify the Stockholder whether it elects
to sell an amount equal to or less than its pro rata portion of the Shares so
offered. Each Selling Holder shall be entitled to apportion Shares to be sold
among its partners and affiliates, provided that such Selling Holder notifies
the Company of such allocation.

                  3.2. NOTICE. Following the Repurchase Period, prior to any
sale by the Stockholder of any Shares, the Stockholder shall notify each
Investor and the Company, in writing, of his intention to sell and issue such
securities, setting forth the general terms under which he proposes to make such
sale. Such notice shall be signed by the third parties, or a representative of
such third parties, or shall be accompanied by a letter of intent signed by the
third parties or representatives of such third parties, to whom the sale,
assignment or transfer is proposed and shall indicate the third parties'
concurrence with the description of the terms.

                  3.3. FAILURE TO NOTIFY. If, within thirty (30) days after the
Stockholder gives his notice to the Investors, the Investors do not notify the
Company that they desire to sell all of their pro rata portion of the Shares
described in such notice at the price and on the terms and conditions set forth
therein, then the Stockholder may, not later than ninety (90) days following
delivery of the notice under Section 3.2 as to the Shares to which the Investors
do not indicate a desire to sell, conclude a transfer on the terms and
conditions described in the notice. In the event the Stockholder has not
concluded such sale of shares within such ninety (90) days, the Stockholder
shall not thereafter sell any Shares without first notifying the Investors and
the Company in the manner provided above. The exercise or non-exercise of the
right to participate in one or more sales of Shares made by the Stockholder
shall not adversely affect an Eligible

                                       4
<PAGE>   18

Holder's right to participate in subsequent sales of Shares by the Stockholder
pursuant to Section 3.1 hereof.

                  3.4. TERMINATION. The obligations of the Stockholder under
this Section 3 shall terminate and be of no further force and effect upon the
occurrence of either event described in subsection 2.4 of this Agreement.

         4. MARKET STANDOFF. The Stockholder hereby agrees that if so requested
by the Company or any representative of the underwriters in connection with any
registration of the offering of any securities of the Company under the Act, the
Stockholder shall not sell or otherwise transfer any Shares for a period of one
hundred eighty (180) days following the effective date of a Registration
Statement filed under the Act; provided, however, that such restriction shall
apply to the first two (2) Registration Statements of the Company to become
effective under the Act which include securities to be sold on behalf of the
Company to the public in an underwritten public offering under the Act. The
Company may impose stop-transfer instructions in order to enforce the foregoing
restrictions.

         5. TAXES. The Stockholder shall execute and deliver to the Company with
this executed Agreement a copy of the Acknowledgement and Statement of Decision
Regarding Election Pursuant to Section 83(b) of the Internal Revenue Code (the
"Acknowledgement") attached hereto as Schedule 5A. The Stockholder shall execute
and submit with the Acknowledgement a copy of the Election Pursuant to Section
83(b) of the Code, attached hereto as Schedule 5B, if the Stockholder has
indicated in the Acknowledgement his decision to make such an election. The
Stockholder should consult his tax advisor to determine if there is a comparable
election to file in the state of his residence and whether such filing is
desirable under the circumstances. The Company may withhold from the
Stockholder's wage, or require the Stockholder to pay to the Company, any
applicable withholding or employment taxes resulting from the lapse of any
restrictions imposed on the Shares.

         6. STOCK RESTRICTIVE LEGENDS. Stock certificates evidencing Shares may
bear such restrictive legends as the Company and the Company's counsel deem
necessary or advisable under applicable law or pursuant to this Agreement,
including, without limitation, the following legends:

                  "The securities represented hereby are subject to a right of
         first refusal by the Company and a right of co-sale on the part of
         certain stockholders pursuant to provisions of the Stock Restriction
         Agreement between the Company and Sampath Parthasarathy dated as of
         April 26, 1995, and may not be sold or otherwise transferred except in
         compliance with the terms of such agreement."

                                       5
<PAGE>   19

                  "The securities represented hereby may be subject to a right
         of repurchase by the Company, pursuant to the provisions of the Stock
         Restriction Agreement between the Company and Sampath Parthasarathy
         dated as of April 26, 1995, and such securities may not be sold or
         otherwise transferred if such securities are subject to such right of
         repurchase."

                  "The securities represented hereby are subject to restrictions
         on transfer for a period of 180 days following the effective date of a
         registration statement under the Securities Act of 1993, as amended,
         for an offering of the Company's securities as more fully provided in a
         Stock Restriction Agreement among the Company, Alliance Technology
         Ventures, L.P., and the original purchaser of such securities."

         7. BINDING EFFECT. Subject to the limitations set forth in this
Agreement, this Agreement shall be binding upon, and inure to the benefit of,
the executors, administrators, heirs, legal representatives, successors, and
assigns of the parties hereto.

         8. DAMAGES. Stockholder shall be liable to the Company and Alliance for
all costs and damages, including incidental and consequential damages, resulting
from a disposition of Shares which is not in conformity with the provisions of
this Agreement.

         9. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Georgia applicable to contracts entered
into and wholly to be performed within the State of Georgia residents. The
parties agree that the exclusive jurisdiction and venue of any action with
respect to this Agreement shall be in the Superior Court of Georgia for the
County of Fulton or the United States District Court for the Northern District
of Georgia, and each of the parties hereby submits itself to the exclusive
jurisdiction and venue of such courts for the purpose of such action. The
parties agree that service of process in any such action may be effected by
delivery of the summons to the parties in the manner provided for delivery of
notices set forth in Section 10.

         10. NOTICES. All notices and other communications under this Agreement
shall be in writing. Unless and until Stockholder is notified in writing to the
contrary, all notices, communications and documents directed to the Company and
related to the Agreement, if not delivered by hand, shall be mailed, addressed
as follows:

                                    ATHEROGENICS, INC.
                                    3343 Peachtree Road, N.E.
                                    Suite 1140
                                    East Tower
                                    Atlanta, Georgia 30326
                                    Attention:  President

                                       6
<PAGE>   20

with a copy to:

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

Unless and until the Company is notified in writing to the contrary, all
notices, communications and documents intended for Stockholder and related to
this Agreement, if not delivered by hand, shall be mailed to Stockholder's last
known address as shown on the Company's books, with a copy to:

                                    Holtzmann, Wise & Shepard
                                    3030 Hansen Way
                                    Suite 100
                                    Palo Alto, CA 94304-1006
                                    Attention: Thomas L. Barton

Notices and communications shall be mailed by registered or certified mail,
return receipt requested, postage prepaid. All notices related to this Agreement
shall be deemed received upon delivery or, if mailed, within five (5) days after
mailing in accordance with this Section 10.

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

                                         ATHEROGENICS, INC.

                                         R. Wayne Alexander
                                         ----------------------------------
                                         By: R. Wayne Alexander, M.D., Ph.D.
                                         Title: President

         Stockholder hereby accepts and agrees to be bound by all of the terms
and conditions of this Agreement.

                           Stockholder Sampath Parthasarathy
                                       --------------------------------------
         Stockholder's spouse indicates by the execution of this Agreement his
or her consent to be bound by the terms herein as to his or her interests,
whether a community property or otherwise, if any, in the Shares.

                           Stockholder's Spouse  Mrs. Dalyaui Parthasarathy
                                                -----------------------------

                                       7
<PAGE>   21

                SCHEDULE 1.01 OF THE STOCK RESTRICTION AGREEMENT

         The Right of Repurchase shall expire as follows:

         Forty percent (40%) of the Shares issued to Stockholder shall vest upon
signing of the Stock Restriction Agreement, twenty percent (20%) shall vest each
year after the date of signing (collectively the "Vested Shares"), and the Right
of Repurchase shall no longer apply to any Vested Shares.

                                          ATHEROGENICS, INC.

                                          R. Wayne Alexander
                                          ----------------------------------
                                          By: R. Wayne Alexander, M.D., Ph.D.
                                          Title: President

                                          Stockholder: Sampath Parthasarathy
                                                       -----------------------

<PAGE>   22

                                 SCHEDULE 5A

                       ACKNOWLEDGEMENT AND STATEMENT
                       OF DECISION REGARDING ELECTION
                        PURSUANT TO SECTION 83(b) OF
                          THE INTERNAL REVENUE CODE

     The undersigned (which term includes the undersigned's spouse), a holder
of 40,000 shares of common stock of ATHEROGENICS, INC., a Georgia corporation
(the "Company") hereby states as follows:

     1.   The undersigned acknowledges receipt of a copy of the Company's Stock
Restriction Agreement (the "Agreement"). The undersigned has carefully reviewed
the Agreement.

     2.   The undersigned either [check as applicable]:

     ____ (a) has consulted, and has been fully advised by, the undersigned's
own tax advisor, ______________________, whose business address is
______________________________, regarding the federal, state and local tax
consequences of entering into the Agreement, and particularly regarding the
advisability of making elections pursuant to Section 83(b) of the Internal
Revenue Code of 1986, as amended (the "Code"), and pursuant to the
corresponding provisions, if any, of applicable state laws; or

      X   (b) has knowingly chosen not to consult such a tax advisor.

     3.   The undersigned hereby states that the undersigned has decided
[check as applicable]:

     ____ (a) to make an election pursuant to Section 83(b) of the Code, and is
submitting to the Company, together with the undersigned's executed Agreement,
an executed form which is attached as Schedule 5B to the Agreement; or

      X   (b) not to make an election pursuant to Section 83(b) of the Code.

     4.   Neither the Company nor any subsidiary or representative of the
Company has made any warranty or representation to the undersigned with respect
to the tax consequences of the Agreement or of the making or failure to make an
election pursuant to Section 83(b) of the Code or the corresponding provisions,
if any, of applicable state law.

<PAGE>   23
    5. The undersigned is also submitting to the Company, together with the
Agreement, an executed original of an election, if any is made, of the
undersigned pursuant to provisions of state law corresponding to Section 83(b)
of the Code, if any, which are applicable to the undersigned's purchase of
shares under the Agreement.

Date: 5/25/95                          /s/ Sampath Parthasarathy
                                       ----------------------------------------
                                       Sampath Parthasarathy, Ph.D.

Date:
                                       ----------------------------------------

                                       2
<PAGE>   24
                                  SCHEDULE 5B

                   ELECTION PURSUANT TO SECTION 83(b) OF THE
                             INTERNAL REVENUE CODE
                             ---------------------

     The undersigned hereby elects pursuant to Section 83(b) of the Internal
Revenue Code of 1986, as amended (the "Code"), to include in the undersigned's
gross income the excess (if any) of (x) the fair market value of the property
described below, over the amount the undersigned paid for such property plus, if
the shares to which this election relates were acquired by exercise of an
"incentive stock option" within the meaning of Section 422 of the Code, the
amount excluded from the undersigned's income pursuant to Sections 421 and 422
of the Code. This election is made to the same effect, and with the same
limitations, with respect to the analogous provisions of Sections 83(b) (and, if
applicable, Sections 412 and 422) of the Code under any applicable state
statute. Pursuant to applicable Treasury Regulations the following information
is provided:

     1.  The undersigned's name, address and taxpayer identification (social
security) number are

         Name:    Sampath Parthasarathy
               ----------------------------------------------------------------

         Address  2958 Worthbrook Drive, Atlanta GA 30340
                 --------------------------------------------------------------

         Social Security #:  [ * ]
                            ---------------------------------------------------

     2.  The property with respect to which the election is made consists of
24,000 shares of Common Stock of ATHEROGENICS, INC., a Georgia corporation (the
"Company").

     3.  The date on which the above property was transferred to the undersigned
was ____________________, 19__, and the taxable year to which this election
relates is 19__.

     4.  The above property is subject to the following restrictions: (a) a
right of repurchase by the Company of the initial purchase price, if the
undersigned ceases to be an employee of, or a consultant to, the Company or an
affiliate of the Company; and (b) a right of first refusal by the Company should
the undersigned wish to transfer the shares to a person or entity other than the
Company.

     5.  The fair market value of the above property at the time of transfer
(determined without regard to any restrictions other than those which by their
terms will never lapse) is $___________ per share.

     6.  The amount paid for the above property by the undersigned was $_______
per share.

     7.  A copy of this election has been furnished to the Company, and a copy
will be filed with the income tax return of the undersigned to which this
election relates.

<PAGE>   25
      8.  If the shares to which this election relates were acquired by
exercise of an "incentive stock option" within the meaning of Section 422 of
the Code, this election is protective only, is made solely to bar application
of Section 83(a) of the Code, and is not an election of the undersigned actually
to recognize income which apart from this election is protected from
recognition by Sections 421 and 422 of the Code.

     If the shares to which this election relates were acquired by exercise of
an incentive stock option, the amount expressly excluded from income pursuant
to Sections 421 and 422 of the Code is $________ per share.

Dated: May 25, 1995.

                                          /s/ Sampath Parthasarathy
                                          ------------------------------------
                                          Sampath Parthasarathy, Ph.D.

                                       2
<PAGE>   26

                              ATHEROGENICS, INC.

                             PATENT, COPYRIGHT AND
                            NONDISCLOSURE AGREEMENT

     In partial consideration and as a condition of my engagement as a
consultant by AtheroGenics, Inc., a Georgia corporation (the "Company"), and
effective as of the date that the consultancy by the Company first commenced,
the undersigned agrees as follows:

     1. NONCOMPETITION

     (a) The Company acknowledges and agrees that during the term of my
consultancy by, or any subsequent consultancy with the Company (the
"Consultancy Period"), I may continue to be employed by the Emory University
School of Medicine ("Emory") or may be employed by or consult with other
academic or non-profit research institutions. In the course of my employment or
consultancy with Emory or another medical school, I will perform services
traditionally performed by members of the faculty of such school, including,
without limitation, (i) teaching, (ii) providing medical services to patients
or related or affiliated hospitals or clinics, (iii) conducting research on
behalf of Emory with respect to medical devices, procedures and pharmaceuticals
or other compounds which may relate to or be used as prescription
pharmaceuticals (including pharmaceuticals which are or may be competitive with
those marketed, promoted or researched by the Company), (iv) researching and
testing pharmaceuticals or compounds manufactured or developed by third parties
under circumstances that result in compensation to Emory (and possible indirect
compensation to me) or such other school for such services, and (v) receiving
honoraria for presentations at medical conferences or seminars, except that I
will not investigate or develop for any other commercial entity (a) the
relationship of oxidation reactions to transcriptional factors, including NFxB,
in cardiovascular disease and other inflammatory diseases, (b) antioxidants and
their anti-inflammatory role in the activation of transcriptional factors in
cardiovascular disease and other inflammatory diseases, or (c) the commercial
development of antioxidants as potential therapeutic mediators in cardiovascular
diseases and other inflammatory diseases. Subject to the foregoing duties which
I perform or may perform for Emory or other academic or research institutions
during the Consultancy Period, I will not, without the prior written approval of
an executive officer of the Company (i) engage in any other professional
employment or consulting or (ii) directly or indirectly participate in or assist
in any business which is a current or potential competitor of the Company.

     (b) I understand and acknowledge that the Company is in the business of
researching, developing, marketing and worldwide promotion of prescription
pharmaceuticals, and that to assist in this business endeavor the Company will
be recruiting investors on a worldwide basis to furnish financial backing.
During the course of my consulting, I will be consulting in the foregoing areas,
i.e. researching, developing, investigating, producing, promoting, marketing
and sales of prescription pharmaceuticals, as well as recruiting investors. I
will acquire in-depth knowledge of certain of the Company's business practices
and confidential information.

<PAGE>   27

     (c) In light of the foregoing, during the Consultancy Period, I agree that
I will not directly or indirectly, expressly or tacitly, for myself or on
behalf of any entity anywhere in the world, (i) act as an officer, manager,
advisor, executive, controlling shareholder, or consultant to any business in
which my duties at or for such business include oversight of or actual
involvement in the research, development, investigation, production, promotion,
marketing or sales or prescription pharmaceuticals which are competitive with
those being produced or developed by the Company, or are under investigation by
the Company at the expiration of the Consultancy Period, (ii) recruit investors
on behalf of an entity which engages in researching, developing, investigating,
producing, promoting, marketing and sales of prescription pharmaceuticals which
are competitive with those being produced or developed by the Company, or are
under investigation by the Company at the expiration of the Consultancy Period,
or (iii) become employed by such an entity in any capacity which would require
me to carry out, in whole or in part, the duties I have performed for the
Company with respect to prescription pharmaceuticals which are competitive with
those being produced or developed by the Company, or are under active
investigation by the Company at the expiration of the Consultancy Period). I
acknowledge that because of the worldwide nature of the Company's business,
this restriction will prevent me from acting in any of the foregoing capacities
for any competing entity wherever located and that this worldwide scope is
reasonable in light of the business of the Company.

     (d) I further agree that during the Consultancy Period, and for a period
of two (2) years following the termination of the Consultancy Period, I will
not directly or indirectly, on my own behalf or in the service or on behalf of
others, solicit, suggest or direct others to solicit for hire any person
employed by the Company at the time of termination of the Consultancy Period.

     (e) I agree that during the Consultancy Period, and for a period of two (2)
years following the termination of the Consultancy Period, I will not, without
the prior written approval of an executive officer of the Company, on my own
behalf or in the service of or on behalf of others, knowingly solicit, divert,
or attempt to appropriate, to any business which competes with the Company in
the fields of research, development, investigation, production, promotion,
marketing, and sales of prescription pharmaceuticals, any person or entity who
is a customer of the Company or an actively sought prospective customer of the
Company (who is known as such by me) during my Consultancy Period.

     (f) I agree that the covenants contained in this Section 1 are reasonable
and necessary to protect the confidentiality of the trade secrets, and other
confidential information concerning the Company acquired by me. The provisions
of this Section 1 shall be interpreted so as to protect those trade secrets and
confidential information, and to secure for the Company the exclusive benefits
of the work performed on behalf of the Company by me under this Agreement, and
not to unreasonably limit my ability to engage in employment and consulting
activities in non-competitive areas which do not endanger the Company's
legitimate interests expressed in this Agreement.

                                       2
<PAGE>   28

     (g) In the event that any of the covenants contained herein in
subparagraphs (a) through (e) are deemed unenforceable by a court of competent
jurisdiction, I agree that each of the covenants herein is severable from each
of the others, and that a declaration of invalidity as to any one of the
covenants shall not effect the enforceability of the others. Further, in the
event one or more of the covenants herein is deemed unenforceable by a court of
competent jurisdiction, the parties hereby agree and request that the court
enforce the covenant(s) to the extent found reasonable by the court. I
acknowledge that I have had the assistance of counsel of my choice in
negotiation of this Agreement and of these covenants.

     2. INVENTIONS

        2.1 DISCLOSURE

            The Company acknowledges and agrees that pursuant to my employment
relationship with Emory or such other academic or non-profit research
institution or commercial enterprise as I may be engaged by in the future
("Employer"), Emory has, and an Employer may have, all right, title and
interest in and to any patentable or unpatentable, copyrightable or
uncopyrightable, idea, invention, work of authorship (including, but not limited
to, computer programs, software and documentation), formula, device,
improvement, method, process or discovery (any of the foregoing items
hereinafter referred to as an "Invention") arising out of, related to or based
upon my work for or on behalf of my Employer. Except for Inventions which arise
out of my employment and belong to my Employer, I will disclose promptly to the
proper officers of the Company in writing any Invention which relates to the
Company's business that I conceive, make, develop, or work on, in whole or in
part, solely or jointly with others during the term of my consultancy with the
Company and for a period of six months thereafter regardless of whether (a)
such invention was conceived, made, developed or worked on during my regular
hours of employment of my time away from work; (b) the Invention was made at
the suggestion of the Company; or (c) the Invention was reduced to drawing,
written description, documentation, models or other tangible form.

        2.2 ASSIGNMENT OF INVENTIONS TO COMPANY

            I hereby assign to the Company without royalty or any other further
consideration my entire right, title and interest in and to any Invention I am
required to disclose under Section 2.1.

        2.3 RECORDS

            I will make and maintain adequate and current written records of
all Inventions covered by Section 2.1. These records shall be and remain the
property of the Company.

                                       3

<PAGE>   29

        2.4 PATENTS

            Subject to Section 2.1, I will assist the Company in obtaining,
maintaining, and enforcing patents and other proprietary rights in connection
with any Invention covered by Section 2.2 for which the Company has or obtains
any right, title or interest. I farther agree that my obligations under this
Section 2.4 shall continue beyond the termination of the Consultancy Period, but
if I am called upon to render such assistance after the termination of the
Consultancy Period, I shall be entitled to a fair and reasonable rate of
compensation for such assistance. I shall, in addition, be entitled to
reimbursement of any out-of-pocket expenses incurred at the request of the
Company relating to such assistance.

        2.5 PRIOR CONTRACTS AND INVENTIONS: INFORMATION BELONGING TO THIRD
            PARTIES

            I represent that, except as set forth on Schedule 2.5A hereto an
initiated by the Company and me, there are no other contracts to assign
inventions that are now in existence between any other person or entity and me.
I further represent that other than my employment obligations for Emory and the
NIH I have no other employments or undertakings which might restrict or impair
my performance of this Agreement I will not, in connection with my engagement
as a consultant by the Company, use or disclose to the Company any confidential
trade secret or other proprietary information or any previous employer or other
person to which I am not lawfully entitled. As a matter of record, I attach to
Schedule 2.5B of this Agreement a brief description of all Inventions made or
conceived by me prior to my engagement as a consultant with the Company which I
desire to be excluded from this Agreement.

     3. NONDISCLOSURE OF CONFIDENTIAL INFORMATION

     (a) I agree that all confidential information which is forwarded to me by
the Company and which is marked Confidential if forwarded in written form or
which is reduced to writing and marked Confidential within thirty days of
forwarding if forwarded in oral form shall be received in strict confidence,
used only for the purposes of this Agreement, and not disclosed by me (except as
required by law or court order) without the prior written consent of the other
Company, unless such information (a) was in the public domain at the time of
disclosure, (b) later became part of the public domain through no act or
omission of the by me, (c) was lawfully disclosed to me by a third party
having the right to disclose it, or (d) was already known by me at the time of
disclosure, as evidenced by written documents in my possession at the time of
the disclosure.

     (b) In order to fulfill my obligation of confidence hereunder, I shall use
at least the same degree of care with the Company's confidential information as
I use to protect my own confidential information. This obligation shall exist
while this Agreement is in force and for a period of four (4) years thereafter.

                                       4

<PAGE>   30

     4. PROPERTY OF THE COMPANY

     All notes, memoranda, reports, drawings, blueprints, manuals, materials,
data and other papers and records of every kind which shall come into my
possession at any time after the commencement of my consultancy with the
Company, relating to any Inventions which I make while performing my duties as a
consultant or member of the Scientific Advisory Board for the Company or
relating to Confidential Information shall be the sole and exclusive property of
the Company. This property shall be surrendered to the Company upon termination
of the Consultancy Period, or upon request by the Company, at any other time
either during or after the termination of the Consultancy Period.

     5. MISCELLANEOUS

        5.1 GOVERNING LAW

            This Agreement shall be construed and governed by the laws of the
State of Georgia applicable to contracts entered into and wholly to be
performed in Georgia by Georgia residents.

        5.2 ENFORCEMENT

            If any portion of this Agreement shall be determined to be invalid
or unenforceable, the remainder shall be valid and enforceable to the maximum
extent possible.

        5.3 INJUNCTIVE RELIEF, CONSENT TO JURISDICTION

            I acknowledge that the Company will suffer substantial damages not
readily ascertainable or fully compensable in terms of money in the event of
the breach of any of my obligations under this Agreement. I therefore agree
that the Company shall be entitled (without limitation of any other rights or
remedies otherwise available to the Company) to obtain an injunction from any
court of competent jurisdiction prohibiting the continuance or recurrence of
any breach of this Agreement. I hereby submit myself to the jurisdiction and
venue of the courts of the State of Georgia for purposes of any such action. I
further agree that service upon me in any such action or proceeding may be made
by first class mail, certified or registered, to my address as last appearing
on the records of the Company.

        5.4 WAIVER

            The waiver by the Company of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any subsequent
breach of the same or any other provision hereof

                                       5

<PAGE>   31

        5.5 BINDING EFFECT

            This Agreement shall be binding upon and shall inure to the benefit
of the successors, executors, administrators, heirs, representatives and
assigns of the parties.

        5.6 HEADINGS

            The Section headings herein are intended for reference and shall
not by themselves determine thee construction or interpretation of this
Agreement.

        5.7 MODIFICATIONS

            All modifications or amendments to this Agreement must be in
writing and signed by the party against whom enforcement of such modification
or amendment is sought.

        IN WITNESS WHEREOF, I have executed this document as of the 26th day
of April, 1995.

                                             /s/ Sampath Parthasarathy
                                             ---------------------------------
                                             Sampath Parthasarathy, Ph.D.

RECEIPT ACKNOWLEDGED:

ATHEROGENICS, INC.

/s/ R. Wayne Alexander
------------------------------------
By: R. Wayne Alexander, M.D., Ph.D.
Title: President

                                       6

<PAGE>   32

                                 SCHEDULE 2.5A

(List here prior contracts to assign inventions that are now in existence
between any other person or entity and you.)
<PAGE>   33

                                 SCHEDULE 2.5B

(List here previous Inventions which you desire to have specifically excluded
from the operation of this Agreement.)

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