Equity Ownership Plan [2004] (2004)Full Document 

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                               ATHEROGENICS, INC

                           2004 EQUITY OWNERSHIP PLAN

     AtheroGenics, Inc. hereby establishes this Plan as the AtheroGenics, Inc.
2004 Equity Ownership Plan, to:  provide incentive to employees, directors,
consultants and advisors of the Company and its affiliates to stimulate their
efforts toward the continued success of the Company and to operate and manage
the business in a manner that will provide for the long-term growth and
profitability of the Company;  encourage stock ownership by employees,
directors, consultants and advisors by providing them with a means to acquire a
proprietary interest in the Company by acquiring shares of Stock or to receive
compensation which is based upon appreciation in the value of Stock; and (c)
provide a means of attracting, retaining and rewarding highly qualified
employees, directors, advisors and consultants.

                                   SECTION 1


     1.1  Definitions.  Whenever used herein, the masculine pronoun shall be
deemed to include the feminine and the singular to include the plural, unless
the context clearly indicates otherwise, and the following capitalized words and
phrases are used herein with the meaning thereafter ascribed:

          (a) "Administrator" means the committee appointed by the Board to
     administer and interpret the Plan in accordance with Section 2.3 below. If,
     at any time, no such committee has been appointed, the Board shall serve as
     the Administrator.

          (b) "Alternate Grantee" means an entity of which a Director is an
     affiliate and to which a Non-Qualified Stock Option grant is made at the
     direction of the Director pursuant to Section 2.4.

          (c) "Award" means any Option, Stock Appreciation Right, or Stock Award
     granted under the Plan.

          (d) "Beneficiary" means the person or persons designated by a
     Participant to exercise an Award in the event of the Participant's death
     while the Award is exercisable, or in the absence of such designation, the
     executor or administrator of the Participant's estate.

          (e) "Board" means the Board of Directors of the Company.

          (f) "Cause" means conduct by the Participant amounting to (1) fraud or
     dishonesty against the Company, (2) willful misconduct, repeated refusal to
     follow the reasonable directions of an individual or group authorized to
     give such directions, or knowing violation of law in the course of
     performance of the duties of Participant's service with the Company, (3)
     repeated absences from work without a reasonable excuse, (4) intoxication
     with alcohol or drugs while on the Company's premises during regular
     business hours, (5) a conviction or plea of guilty or nolo contendere to a
     felony or a crime involving dishonesty, or (6) a breach or violation of the
     terms of any employment or other agreement to which Participant and the
     employer are party.

          (g) "Change in Control" shall be deemed to have occurred if (i) a
     tender offer shall be made for and consummated with respect to the
     ownership of 50% or more of the outstanding voting securities of the
     Company, (ii) the Company shall be merged or consolidated with another
     corporation and as a result of such merger or consolidation less than 50%
     of the outstanding voting securities of the surviving or resulting
     corporation shall be owned in the aggregate by the former shareholders of
     the Company, other than affiliates (within the meaning of the Exchange Act)
     of any party to such merger or consolidation, (iii) the Company shall sell
     substantially all of its assets to another corporation which corporation is
     not wholly owned by the Company, or (iv) a person, within the meaning of
     Section 3(a)(9) or of Section 13(d)(3) (as in effect on the date hereof) of
     the Exchange Act, shall acquire 50% or more of the outstanding voting
     securities of the Company (whether directly, indirectly, beneficially or of
     record). For


     purposes hereof, ownership of voting securities shall take into account and
     shall include ownership as determined by applying the provisions of Rule
     13d-3(d)(l)(i) (as in effect on the date hereof) pursuant to the Exchange

          (h) "Code" means the Internal Revenue Code of 1986, as amended, and
     the regulations promulgated thereunder.

          (i) "Company" means AtheroGenics, Inc., a Georgia corporation.

          (j) "Constructive Discharge" means a Participant's termination of his
     or her employment with the Company and its affiliates on account of (i) any
     material reduction in the Participant's compensation, (ii) any material
     reduction in the level or scope of job responsibility or status of the
     Participant occurring without the consent of the Participant, or (iii) any
     relocation to an office of the Company which is more than fifty (50) miles
     from the office where the Participant was previously located to which the
     Participant has not agreed.

          (k) "Director" means a member of the Board or a member of the Board of
     Directors of any affiliate of the Company.

          (l) "Disability" has the same meaning as provided in the long-term
     disability plan maintained by the Company. If, at any time during the
     period that this Plan is in operation, the Company does not maintain a
     long-term disability plan, Disability shall mean a physical or mental
     condition which, in the judgment of the Administrator, permanently prevents
     a Participant from performing his usual duties for the Company or such
     other position or job which the Company makes available to him and for
     which the Participant is qualified by reason of his education, training and
     experience. In making its determination the Administrator may, but is not
     required to, rely on advice of a physician competent in the area to which
     such Disability relates. In the event of a dispute, the determination of
     Disability shall be made by the Administrator in its sole discretion. Any
     decision of the Administrator will be final and binding on all parties.

          (m) "Disposition" means any conveyance, sale, transfer, assignment,
     pledge or hypothecation, whether outright or as security, inter vivos or
     testamentary, with or without consideration, voluntary or involuntary.

          (n) "Equity Ownership Agreement" means an agreement between the
     Company and a Participant or other documentation evidencing an Award. The
     Equity Ownership Agreements authorized under the Plan may contain such
     provisions as the Administrator shall deem advisable, not inconsistent with
     the provisions of the Plan.

          (o) "Exchange Act" means Securities Exchange Act of 1934, as amended,
     and guidance issued thereunder.

          (p) "Exercise Price" means the purchase price per share of the shares
     of Stock underlying an Option.

          (q) "Expiration Date" means the last date upon which an Option or
     Stock Appreciation Right can be exercised (or paid, if applicable).

          (r) "Fair Market Value" means, for any particular date, (i) for any
     period during which the Stock shall be listed for trading on a national
     securities exchange or NASDAQ, the closing price per share of Stock on such
     exchange or the NASDAQ closing bid price as of the close of such trading
     day, or (ii) the market price per share of Stock as determined in good
     faith by the Board in the event (i) above shall not be applicable. If the
     Fair Market Value is to be determined as of a day when the securities
     markets are not open, the Fair Market Value on that day shall be the Fair
     Market Value (determined in accordance with the preceding sentence) on the
     next succeeding day when the markets are open.

          (s) "Incentive Stock Option" means an incentive stock option, as

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