Exhibit 10.27


 


CONFIDENTIAL COMMERCIAL
AGREEMENT


 


CLINICAL TRIAL SERVICES MASTER AGREEMENT


 


THIS CLINICAL TRIAL SERVICES MASTER AGREEMENT
(the “Agreement”) is entered into as of March 21,2003 (the “Effective Date”),
by and between (i) JSW Research, whose offices are located at
Rankengasse 28, Graz A-8020 Austria (together with its agents and/or
affiliates, “JSW”), and (ii) Axonyx, whose offices are located at
Bilderdijkstraat 9, 2311 XD Leiden, The Netherlands


 


WHEREAS, Axonyx is engaged in research,
development and commercialization of human pharmaceutical products;


 


WHEREAS, JSW is a contract clinical research
organization with experience and expertise in planning, overseeing, managing
and monitoring human clinical trials as well as other related services;


 


WHEREAS, Axonyx desires to engage JSW to
provide certain clinical trial management and other services, and JSW desires
to provide such services to Axonyx, subject to the terms and conditions of this
Agreement.


 


NOW THEREFORE, in consideration of the foregoing
and the mutual representations, warranties and covenants contained in this
Agreement and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree
as follows:


 


1.
SERVICES TO BE RENDERED


 


Axonyx hereby engages JSW to provide, and JSW
hereby agrees to provide, the clinical trial management and other services
known as ‘Scope of Work’ and described in Appendix I, in accordance with the
terms and conditions set forth in this Agreement for the clinical trial (the
“Clinical Trial”) entitled ‘A Randomized, double-blind, placebo-controlled
trial to evaluate the safety and efficacy of Phenserine-tartrate in patients
with mild to moderate probably Alzheimer’s disease — Phenserine/APP and Aß’. In
summary, the Clinical Trial is designed to enroll at least 75 patients in an
effort to obtain 65 who are evaluable, i.e. have completed the Clinical Trial
in its entirety.


 


2.
CLINICAL TRIAL DEVELOPMENT ACTIVITIES


 


The parties shall follow the procedures and
have responsibility for performing their respective obligations set forth below
with respect to the Clinical Trial.


 

















 


2.1
Protocol


 


The protocol associated with the clinical
research activities for the product, Axonyx (the “Product”) involved in the
Clinical Program is attached hereto in Appendix II. The Protocol describes the
plans for conducting the Clinical Trial. The Clinical Trial will be conducted
per the attached protocol document.


 


2.2
Regulatory Matters


 


Axonyx shall be the regulatory sponsor of the
Clinical Trial under the U.S. Code of Federal Regulations and will hold any
IND. Axonyx shall, in consultation with the FDA, determine whether the
development of any Product will be made under an existing IND or a new IND.
Axonyx shall prepare and file any new IND or IND amendment with the FDA. Axonyx
shall prepare any subsequent amendments to the IND. Axonyx will be responsible
for all written and oral contact with the FDA with respect to the IND and any
other information required under FDA regulations, including without limitation
21 CFR § 312, including, but not limited to IND safety reports and annual
reports required to be submitted by Axonyx to the FDA. JSW shall provide to
Axonyx all information, and execute all documents, requested by Axonyx that
are necessary for the transfer by Axonyx, the regulatory sponsor, to JSW of
certain obligations, defined in Appendix 2, under FDA regulations, including
without limitation 21 CFR § 312.52 “Transfer of Obligations to a Contract
Research Organization.”


 


Notwithstanding anything
contained in this Agreement to the contrary, JSW shall not initiate or
participate in any communications with the FDA concerning the subject matter
hereof unless required by law or requested to do so by Axonyx and then only
after prior consultation with Axonyx.


 


2.3
Clinical Sites; Investigators


 


Prior to the commencement of the Clinical
Trial, JSW shall provide to Axonyx for its review a list of proposed clinical
sites and investigators to perform the Clinical Trial, selected by JSW based on
the expertise of the investigators in the therapeutic area covered by the
Clinical Trial and the ability of the clinical sites and investigators to
recruit the required patient population for rapid enrollment in the Clinical
Trial. JSW shall review FDA’s listings of debarred, disqualified and restricted
investigators and clinical sites, and shall not propose any clinical sites or
investigators appearing in such listings. At Axonyx’s request, JSW shall
provide additional information and documentation on the clinical sites and
investigators proposed by JSW, and Axonyx may identify additional clinical
sites and investigators for inclusion in the Clinical Trial. JSW shall not
propose any investigators or clinical sites that have been listed by FDA as
debarred, disqualified, restricted, or required to make assurances concerning
their use of investigational products. Axonyx may also make visits to any
clinical site for purposes of independently evaluating the acceptability of
such clinical site.


 


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2.4
Clinical Trial Drug Supply and Shipment


 


JSW shall handle Clinical Trial Product
distribution to the clinical sites. No Clinical Trial Product shall be shipped
to any clinical site without appropriate IRB approval for study conduct and
other documentation required under applicable regulatory requirements. JSW
shall also assure the return of all unused supplies of the Product from each
individual investigator whose participation in the investigation is
discontinued or terminated, or assure compliance with an alternative
disposition of unused supplies of the Product approved by Axonyx. JSW shall
maintain adequate records showing the receipt, shipment, return or other
disposition of the Product.


 


2.5 Clinical Safety Reports


 


Within twenty-four (24) hours of the
notification of occurrence of a serious adverse experience, as defined under
FDA regulations, including without limitation 21 CFR § 312.32 (“Serious Adverse
Experience”), relating to the Clinical Trial, JSW shall inform Axonyx of such
occurrence. At a minimum, serious adverse event reports shall include the
patient’s initials/study identifier, the reporter’s name, and a description of
the event. Axonyx shall prepare and provide to the FDA all written IND safety
reports and telephone reports within the timeframes and containing the
information required under FDA regulations, including without limitation 21 CFR
§ 312.32. For all adverse events relating to the Clinical Trial other than any
Serious Adverse Experiences, JSW shall provide Axonyx in a timely manner all
information relating to such adverse events. Axonyx shall prepare and submit to
the FDA all annual reports containing the description of such adverse
experiences as required under FDA regulations, including without limitation 21
CFR § 312.33. Axonyx will provide JSW with a copy of each such report submitted
to the FDA. Axonyx may, at its option, communicate directly with any clinical
site and investigator about any Serious Adverse Experience or other adverse
event.


 


2.6
Changes or Modifications


 


(a) Axonyx will have the right to review or
request changes to the following guidelines and plans that relate to the
conduct of the Clinical Trial.


 


•                  Monitoring
guidelines


•                  Quality
assurance guidelines


•                  Data validation
guidelines


•                  Statistical
analysis plan


•                  Final study
report format


 


If any alteration, modification, amendment to
the Clinical Trial is required, the requesting party shall provide written
notice to the other party in accordance with the following procedures: A change
proposed by either party shall be initiated by a written notice (“Change
Order”) to the other party. Each Change Order shall explain in reasonable


 


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detail the specific changes to the Clinical
Trial, task, responsibility, duty, timeline, applicable budget, requested by
the initiating party.


 


(b) Upon receiving a Change Order initiated
by Axonyx, JSW shall furnish Axonyx with an estimate of the effect, if any,
upon the applicable budget (whether an increase or decrease) within ten (10)
days of JSW’s receipt of said Change Order, or other period of time as mutually
agreed upon in writing by the parties. Upon Axonyx’s written approval of JSW’s
estimate (such approval shall not be unreasonably withheld) and the parties’
execution of the Change Order, said Change Order will be effective and its
terms shall be incorporated herein.


 


(c) Likewise, for example, if the Clinical
Trial is delayed by more than thirty (30) days at the request of Axonyx or
delayed due to material reasons beyond JSW’s control (a “Trial Delay”),
additional (out of scope) charges may be incurred. JSW will immediately notify
Axonyx of a Trial Delay and its proposed changes in budget due to increased
personnel costs, additional time or material that may be required by JSW to
deal with the change in the study timeline. JSW will use its best efforts to
mitigate such costs. Upon Axonyx’s written approval and the parties’ execution
of Health Decision’s Change Order, said Change Order will be effective and the
terms of the Change Order shall be incorporated herein.


 


2.7
Records; Axonyx’s Right to Audit


 


(a) As part of its services hereunder, JSW
shall maintain complete and accurate records, accounts, notes, reports and data
pertaining to the Clinical Trial and JSW’s activities hereunder in accordance
with Applicable Standards (as defined herein). Axonyx may at its option upon
reasonable advance notice and during normal business hours audit all
information, databases and records, accounts, notes, reports, and data
pertaining to the Clinical Trial and JSW’s performance under this Agreement.
During the term of this Agreement, JSW shall maintain all materials,
information, databases and records, accounts, notes, reports, and data obtained
or generated by JSW in the course of providing services under this Agreement,
including all computerized records and files, in a non-public and secure area.
Axonyx may at any time have access to any and all clinical data for the
Clinical Trial and clinical sites.


 


(b) At Axonyx’s request, JSW shall cooperate
with any regulatory authorities and allow them access to applicable records and
data. JSW shall inform Axonyx of any request or effort by any regulatory
authority to review records and data, or to contact, visit, or inspect JSW’s
records and data, relating to the Clinical Trial or JSW’s performance of
services under this Agreement, and shall notify Axonyx within two (2) business
days if any regulatory authority issues or gives to JSW any notice of intent to
inspect, notice of inspection, notice of inspectional observations, warning
letter, or other written communication concerning the Clinical Trial.


 


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2.8
Periodic Reports; Return of Materials


 


(a) JSW shall, within the first seven days of
each month, provide to Axonyx a written report on the status of its activities
under this Agreement and the Clinical Trial. JSW will use its best efforts to
provide information in such reports of a nature and in a format as may be
reasonably requested by Axonyx. In addition, JSW will use its best efforts to:
(i) make a complete backup of such reports on a reasonably frequent basis, (ii)
prevent unauthorized access to and use of such reports, and (iii) maintain the
security and confidentiality of such reports.


 


(b) At the expiration or termination of this
Agreement, all materials, information, databases and records, accounts, notes,
reports and data obtained or generated by JSW in the course of providing services
under this Agreement shall, at Axonyx’s option and at its direction and written
request, be (i) delivered to Axonyx at its offices as Axonyx shall request or
(ii) retained by JSW under a mutually agreeable arrangement and at a cost to be
negotiated at that time. In no event will JSW dispose of materials,
information, databases and records, accounts, notes, reports or data obtained
or generated by JSW in the course of providing services under this Agreement
without first giving Axonyx sixty (60) days prior written notice of its intent
to do so and complying with any directions or written requests provided by
Axonyx during such sixty (60) day period. For avoidance of doubt, the
obligations of JSW under this Section 2.8 shall remain in effect notwithstanding
any dispute between the parties.


 


3. COMPENSATION; PAYMENTS


 


3.1
Compensation


 


As payment to JSW for services provided by
JSW under this Agreement, Axonyx shall compensate JSW in accordance with the
budget (the “Direct Cost Budget”) consisting of the milestone payment schedule
set forth in Appendix 3 attached hereto, as the same may be amended from time
to time by mutual consent of the parties hereto. In the event that the Clinical
Trial or part thereof is terminated before completion, Appendix 3 shall be
amended as Axonyx reasonably directs to reflect the impact of such termination
and JSW will be compensated for all work actually completed to date including
all reasonable costs associated with termination of the trial. Additionally,
JSW shall be reimbursed within fifteen (15) days of invoice of any and all
uncancellable obligations with regard to third parties who are providing goods
and/or services that appropriately and reasonably fall within the work outlined
in this agreement. Any funds held by JSW that shall be shown by Axonyx to be
unearned at the conclusion of the termination process shall be returned to
Axonyx within forty-five (45) days of termination of this Agreement.


 


3.2 Pass Through Costs


 


JSW will pass through certain costs (“Pass
Through Costs”) of the Clinical Trial to Axonyx. These Pass Through Costs
include expenses incurred [details], and reasonable travel expenses incurred by
JSW as required to monitor the progress and regulatory


 


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compliance of the Clinical Trial.
Reimbursement by Axonyx for all other travel expenses is subject to Axonyx’s
prior approval of such travel. Axonyx, as described in the Coverage Agreement
attached as Appendix 4, bears sole responsibility for these expenses but JSW
will, as Axonyx’s agent and with Axonyx’s written approval of each contract,
enter into agreements with [subcontractors] and other entities that Axonyx
identifies and to which JSW agrees (“Contractors”) and will pay expenses
incurred by the Contractors from an account (“Pass Through Account”) that has
been funded in advance by Axonyx and that is under the control of JSW. JSW will
not enter into agreements with a Contractor until it has received both written
authorization from Axonyx and funding from Axonyx for any up-front costs
required by a Contractor. As Pass Through Costs are received or accrued by HDL,
they will be reported and tracked for Axonyx and invoiced to be paid by Axonyx.


 


3.3
Payments; Taxes


 


All payments provided for under the terms of
this Agreement shall be invoiced by email to Axonyx and payments will be
transferred by wire to JSW’s account within fifteen (15) calendar days of the
invoice. Payments not received within fifteen (15) days of invoice will be
subject to an interest rate of 12% per annum. Payments not received within
thirty (30)days following receipt by Axonyx of written notice given by JSW of
non-payment will be regarded as a breach of contract on behalf of Axonyx and
grounds for termination of this Agreement. Taxes (including any penalties
thereon) imposed on any payment made to JSW pursuant to this Agreement shall be
the sole responsibility of JSW.


 


3.4
Audit


 


During the term of this Agreement and for a
period of one year thereafter, Axonyx shall have the right to engage a
recognized accounting firm and any other consultants that Axonyx deems
necessary or desirable to audit JSW’s records, agreements and other documents
relating solely to Pass-Through Costs; provided, however, that Axonyx shall exercise
such audit rights no more than once during any consecutive twelve (12) month
period. Any such audit shall take place at a time and place agreed to by the
parties no later than thirty (30) days following Axonyx’s notice of exercise of
its audit rights hereunder. JSW shall cooperate fully in any audit conducted
hereunder and shall provide reasonable access to relevant employees, agents,
and other representatives of JSW and to HDL’ books, records, agreements, and
other documents pertinent to Pass-Through Costs. Axonyx shall be responsible
for its own expenses for these audits, including the costs of its accountants
and consultants; provided, however, that in the event that audit results
determine that the Pass Through Costs have been overstated, or payments have
been made by Axonyx by more than ten (10%) percent for the period examined, JSW
shall pay all reasonable costs and expenses incurred by Axonyx in the course of
making such determination, including the fees and expenses of such accountants.


 


6

















 


4.
CONFIDENTIALITY AND PROPRIETARY RIGHTS


 


4.1
Confidentiality


 


JSW agrees to maintain as confidential any
and all information relating to the Clinical Trial JSW has received or receives
from Axonyx or obtains as a result of the performance by JSW of services under
this Agreement, including any reports posted to the study website
(“Confidential Information”), and further agrees to disclose the Confidential
Information only to those persons under JSW’s direct control who have a need to
know the Confidential Information for purposes of performing JSW’s obligations
under this Agreement and who have agreed in advance in writing to comply with
and be bound by the terms of this Article 4. At no time shall JSW use, or allow
others to use, the Confidential Information for any purpose other than
performance of JSW’s obligation under and in accordance with this Agreement or
disclose the Confidential Information to any third party without the prior
written consent of Axonyx and then only after the party to whom such disclosure
will be made has agreed in writing to comply with and be bound by the terms of
this Article 4. The foregoing confidentiality obligations shall not apply to
Confidential Information to the extent JSW can establish by competent documentary
proof that:


 


(a) such Confidential Information was already
properly known to JSW at the time of disclosure to JSW, provided that JSW
advises Axonyx promptly upon discovering that such Confidential Information was
already known to JSW;


 


(b) such Confidential Information was
generally available to the public or otherwise part of the public domain at the
time of disclosure to JSW;


 


(c) such Confidential Information became
generally available to the public or otherwise part of the public domain after
its disclosure or development, as the case may be, and other than through an
act or omission of JSW(or its employees, agents, advisors or other personnel
under JSW’s control;


 


(d) such Confidential Information was
properly disclosed to JSW, other than under an


obligation of confidentiality, by a third
party who had no obligation to Axonyx not to disclose such information to
others; or


 


(e) JSW was required to disclose such
information pursuant to applicable laws, rules, regulations, court or
administrative proceedings or the like, provided that JSW notified Axonyx in
writing at least ten (10) days in advance and provided Axonyx with the
opportunity to seek an appropriate protective order prevent to such disclosure.


 


4.2
Publication


 


JSW shall not publish any articles or papers
or make any presentations, nor assist any other person in publishing any
articles or papers or making any presentations, relating or referring to the
Clinical Trial, the services performed by JSW hereunder, Clinical Trial


 


7

















 


results, or data, information, materials
obtained or generated in the performance of JSW’s obligations hereunder, in
whole or in part, without the prior written consent of Axonyx in its sole
discretion.


 


4.3
Proprietary Rights


 


(a) Neither anything contained in this
Agreement nor the disclosure or provision to JSW of any Confidential
Information or other information or items shall be deemed to transfer or grant
to JSW, or any other person or entity any right, title, interest, or license
in, to or under any patent or patent application of Axonyx or other
intellectual property or other right of Axonyx or in or to any information,
discoveries, knowledge, experience, processes, procedures, devices,
compositions of matter, skills, know-how, samples, trade secrets, designs,
formulae, specifications, methods, techniques, compilations, programs, devices,
technical information, concepts, developments, inventions or improvements,
whether patentable or not, or other technology, inventions or property of
Axonyx.


 


(b) JSW agrees, and shall instruct all
investigators and clinical sites to agree, that all information, discoveries,
knowledge, experience, processes, procedures, devices, compositions of matter,
skills, know-how, samples, trade secrets, designs, formulae, specifications,
methods, techniques, compilations, programs, devices, technical information,
concepts, developments, inventions or improvements, whether patentable or not
(“Inventions”) (except for JSW-developed computer software programs,
statistical methodologies, technical processes, methods, formulae or analyses,
each as developed by JSW’ prior to the date of this Agreement (the “JSW
Property”) and which shall remain the sole and separate property of JSW)
arising from JSW’s performance of its obligations under this Agreement shall
promptly be made known to Axonyx in writing and Axonyx shall have sole and
exclusive rights to all such Inventions, which shall be the sole and exclusive
property of Axonyx. JSW hereby agrees to assign, and hereby assigns to Axonyx,
without additional compensation, its entire right, title and interest in and to
all Inventions. To the extent, if any, that any Inventions are not assignable
or that JSW retains any right, title or interest in and to any Invention, JSW
(i) unconditionally and irrevocably waives the enforcement of such rights, and
all claims and causes of action of any kind against Axonyx with respect to such
rights; (ii) agrees, at Axonyx’s request and expense, to consent to undertake or
join in any action to enforce such rights; and (iii) hereby grants to Axonyx a
perpetual, irrevocable, fully paid-up, royalty-free, transferable,
sub-licensable (through multiple levels of sublicenses), exclusive, worldwide
right and license to use, reproduce, distribute, display and perform (whether
publicly or otherwise), prepare derivative works of and otherwise modify, make,
sell, offer to sell, import and otherwise use and exploit (and have others
exercise such rights on behalf of Axonyx) all or any portion of such Invention,
in any form or media (now known or later developed).


 


(c) Whenever requested to do so by Axonyx,
JSW will execute any and all applications, assignments, or other instruments
and give testimony, which Axonyx shall deem necessary to apply for and obtain
Letters of Patent in the U.S. or other country; or to otherwise protect the
interests of Axonyx therein. Axonyx shall compensate JSW, subcontractors and
agents for the time devoted to said activities and reimburse JSW for


 


8

















 


reasonable expenses actually incurred. These
obligations shall continue beyond the termination of this Agreement with
respect to Inventions, and shall be binding upon assignees, administrators and
other legal representatives of JSW.


 


4.4
Rights in Materials, Data and Reports


 


JSW hereby agrees to assign, and hereby
assigns, and shall instruct all investigators and clinical sites to assign, to
Axonyx all right, title and interest, including copyrights and other intellectual
property rights, in and to all works of authorship, data, reports and other
materials, including without limitation protocols, investigators’ brochures,
case report forms and summary statistical reports, which shall be developed in
performance of the Clinical Trial or by JSW in the course of performing its
obligations under this Agreement. For avoidance of doubt, the obligations of
JSW to assign and deliver to Axonyx the subject matter under this Section 4.4
shall remain in effect notwithstanding any dispute between the parties.
Furthermore, for the avoidance of doubt, this clause shall not apply to any JSW
Property or any direct developments of such JSW Property that may occur during
the term of this Agreement.


 


4.5
Survival


 


The terms of this Article 4, and the parties’
obligations hereunder, shall survive termination or expiration of this
Agreement for any reason whatsoever and the completion of all JSW’s performance
of all of its obligations under this Agreement.


 


5.
ADDITIONAL REPRESENTATIONS, WARRANTIES AND COVENANTS


 


JSW represents, warrants and covenants that:


 


5.1
Conduct of Activities


 


It will perform, and cause all investigators
and clinical sites to perform, the services and obligations to be performed by
JSW or an investigator or clinical site pursuant to this Agreement (including
as set forth in Appendix 1) in a competent manner in conformance with the
standard of care usually and reasonably expected in the performance of such
activities,
and in each case in conformance with procedures approved by Axonyx
and to its reasonable satisfaction.


 


5.2
Compliance


 


It will perform, and cause all investigators
and clinical sites to perform, the services and obligations to be performed by
JSW or an investigator or clinical site pursuant to this Agreement in
compliance with all applicable laws, published guidelines, rules and
regulations, including but not limited to the ICH Consolidated Guidance for
Good Clinical Practice (April 1996), the United States Food, Drug and Cosmetic
Act and the


 


9

















 


regulations promulgated by the FDA pertaining
to clinical investigations and the use of investigational drugs in humans, all
of such protocols, guidelines, standards, laws, rules and regulations to be
hereinafter and collectively referred to as “Applicable Standards”, and with
the standard of care customary in the industry. JSW will promptly notify Axonyx
of any observed or suspected violations of such Applicable Standards by
Investigators and Clinical Sites.


 


5.3
No Debarment


 


In accordance with the requirements of the
U.S. Food, Drug, and Cosmetic Act, JSW certifies that it is not and will not be
using the services of any person debarred under 21 U.S.C.§ 335a in any capacity
in connection with the performance of the services provided under this
Agreement. JSW also certifies that it is not and will not be using the services
of any person or affiliate person/firm for whom convictions subject to
debarment have occurred in the past five (5) years in any capacity in connection
with the performance of the services. If at any time after execution of this
Agreement, JSW becomes aware that it or any person employed by it or any
affiliate person/firm has been or is in the process of being debarred or is
convicted of an offense subjecting it or any person to debarment, JSW hereby
agrees that it will so notify Axonyx at once. JSW shall regularly, but no less
frequently than once per calendar quarter, review the names of (a) those
persons whose services it uses, whether or not employed by JSW, and (b) the
clinical sites and investigators retained for the Clinical Studies as
identified on the Form FDA-1572, against the list of debarred individuals.


 


5.4
Inspections


 


If any governmental or regulatory authority
conducts or gives notice to JSW or any investigator or clinical site of its
intent with respect to any activities under this Agreement to conduct an
inspection at facilities of JSW or any clinical site or take any other
regulatory action, or if JSW or any investigator or clinical site becomes aware
of any such governmental inspection or other regulatory activity at one of the
clinical Sites being monitored by JSW, JSW shall promptly give Axonyx notice
thereof, including all information pertaining to any such inspections or actions;


 


5.5
No Sanctions


 


Neither it nor any of its personnel have been
subjected to any restrictions or sanctions related to allegations of research
or professional misconduct.


 


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6.
INDEMNIFICATION; INSURANCE


 


6.1
Indemnification by JSW


 


JSW agrees to defend, indemnify, and hold
harmless Axonyx and its respective affiliates, employees, officers, directors,
and consultants against and from any losses, claims, liabilities, damages,
proceedings, or investigations (including reasonable attorney fees and court
costs) arising out of or in connection with JSW’s negligence, intentional
misconduct, breach of any covenant or warranty, or the inaccuracy of any
representation of JSW in this Agreement, or JSW’s failure to comply with the
terms of the Clinical Trial (and related Protocol, as it may be amended from
time and time and as currently in effect), Applicable Standards, written
instructions by Axonyx, or the terms of this Agreement, in connection with
JSW’s performance of its obligations under this Agreement, provided that such
claim did not arise out of or in connection with Axonyx’s gross negligence,
intentional misconduct and willful malfeasance.


 


6.2
Indemnification by Axonyx


 


Axonyx agrees to defend, indemnify, and hold
harmless JSW and its respective affiliates, employees, officers, directors, and
consultants (the “JSW Indemnitees”) against and from any losses, claims,
liabilities, damages, proceedings, or investigations (including reasonable
attorney fees and court costs) brought against JSW Indemnitees, or any one of
them, by a third party arising out of or in connection with Health Decision’s
performance under this Agreement, provided that:


 


(a) such claim did not arise out of or in
connection with JSW’s negligence, intentional misconduct, breach of any
covenant or warranty, or the inaccuracy of any representation, of JSW in this
Agreement, or JSW’s failure to comply with the terms of any Clinical Trial, the
Applicable Standards, any written instructions by Axonyx, or the terms of this
Agreement;


 


(b) the JSW Indemnitees notify Axonyx within
a reasonable period after receipt of such claim and cooperate with Axonyx in
their defense; and


 


(c) Axonyx will have the right to select
defense counsel and to direct the defense or settlement of any such claim or
suit.


 


6.4
Limitation of Liability


 


Neither party shall be liable for any
indirect, incidental, special or consequential damages, including loss of
profits, revenue, goodwill, shareholder confidence and similar remote damages
incurred by the other party, whether in an action in contract or tort, even if
it has been advised of the possibility of such damages.


 


6.5
Insurance


 


JSW will during the term of this Agreement
carry employers liability, public liability and office insurance policies
conforming to usual standards operating in Europe and in such amounts and
providing such coverage as is reasonable and customary for commercial entities
providing services like those being rendered by JSW under this Agreement.


 


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Axonyx will during the term of this Agreement
carry clinical trials indemnity insurance conforming to international standards
and valid in each country where Clinical Trial is conducted and in such amounts
and providing the coverage as is reasonable and customary for commercial
entities conducting research on pharmaceutical products. Axonyx will ensure
that JSW is listed as a named insured.


 


Upon request, Axonyx will provide written
evidence of such insurance to JSW and will provide JSW thirty (30) days prior
written notice of any cancellation in any of the above coverage. For the
avoidance of doubt, JSW will not instruct administration of a pharmaceutical
product to patient or healthy volunteer recipients without a copy of the valid
clinical trial indemnity insurance certificate being previously filed with JSW.


 


6.6.
Survival


 


The terms of this Article 6, and the parties’
obligations hereunder, shall survive termination or expiration of this
Agreement for any reason whatsoever and the completion of all JSW’s performance
of all of its obligations under this Agreement.


 


7.
TERM; TERMINATION; POSTPONEMENT


 


7.1
Term


 


This Agreement shall be effective beginning
on the Effective Date and shall remain in full force and effect until the Scope
of Work provided by JSW for the Clinical Trial is complete or until terminated
in accordance with the terms of this Agreement. The anticipated schedule of
this project is provided in Appendix 3.


 


7.2
Termination by JSW or Axonyx for Patient Safety


 


In the event JSW or Axonyx believes that
patient safety considerations may indicate that the Clinical Trial or part
thereof should cease, JSW or Axonyx shall promptly consult with the other
regarding such belief and the reasons therefore, and JSW shall cooperate with
Axonyx in making any changes necessary to address and cure such safety
considerations. Axonyx shall terminate the Clinical Trial only if Axonyx
determines that patient safety considerations require such termination. In the
event that Axonyx determines not to so terminate the Clinical Trial or part
thereof, subject to this Section 7.2, JSW shall have the right to terminate
this Agreement effective immediately upon the giving of written notice of
termination to Axonyx.


 


7.3
Termination


 


This Agreement may be terminated (i)
immediately by Axonyx or JSW, as the case may be, upon the material breach of
this Agreement by the other party and the failure of such other party to cure
such breach within thirty (30) days of receipt of the non-breaching


 


12

















 


party’s written notice of such breach and
(ii) by Axonyx or JSW without cause upon thirty (30) days prior written notice
to the other of its intent to terminate.


 


7.4
Effect of Termination


 


Upon termination of this Agreement, JSW shall
cooperate with Axonyx to provide for an orderly wind down of the services
provided by JSW hereunder and, if Axonyx elects to continue the Clinical Trial
or part thereof in the event of a termination of this Agreement, an orderly
transfer of JSW’s responsibilities with respect to the Clinical Trial or part
thereof to Axonyx or its designee, including without limitation JSW’s
assignment at Axonyx’s request of one or more Clinical Trial Agreements to
Axonyx. Termination of this Agreement shall not relieve Axonyx from any accrued
but unpaid obligations for services actually performed by JSW prior to such
termination and for any reasonable wind down expenses or for reasonable
expenses properly incurred by JSW under this Agreement prior to the date of
notice of termination (including any expenses so incurred but payable after the
effective date of termination) which would otherwise have been payable by
Axonyx under the terms of this Agreement, unless Axonyx objects to any such
amount, in which case the parties shall use best efforts to resolve
expeditiously any disagreement. JSW shall use its best efforts to minimize the
amount of obligations which could be payable by Axonyx following termination.


 


7.5
Postponement of Clinical Trial


 


Axonyx may, in its sole discretion, suspend
or delay the Clinical Trial or any part thereof. In the event of suspension or
delay of the Clinical Trial or any part thereof, Axonyx may, by giving written
notice to JSW, suspend or delay JSW’s performance of services under this
Agreement with respect to the Clinical Trial or any part thereof. In the event
of suspension or delay of the Clinical Trial or any part thereof under this
Section 7.5, Axonyx shall remain obligated to pay to JSW in accordance with
Appendix 3 all accrued but unpaid amounts for services satisfactorily rendered
by JSW through the date of such suspension or delay and caused by any
suspension or delay. Upon receipt of written notice of suspension or delay of
the Clinical Trial or any part thereof under this Agreement, JSW shall use its
best efforts to immediately suspend its and each affected clinical site’s
performance of services, shall make no further expenditures nor incur further
expenses, (and shall attempt to mitigate any expenses or costs already incurred
in connection with the suspension or delay of services), except those directly
caused by the suspension or delay, under this Agreement with respect to the
Clinical Trial until such time as Axonyx notifies JSW of the resumption of the
Clinical Trial or any part thereof. In the event of resumption of the Clinical
Trial or any part thereof, Axonyx shall notify JSW in writing, at which time
JSW will resume, and instruct each clinical site to resume, their respective
activities with respect to the Clinical Trial in accordance with the terms of
this Agreement. If the period of the suspension or delay is more than 30 days,
JSW will have the right to renegotiate the financial terms of the project to
the extent that it anticipates additional costs will be incurred relating
directly to the reinstatement of the Clinical Trial.


 


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8.
ARBITRATION


 


If a dispute arises between the parties in
connection with this Agreement, or a disagreement arises regarding the
interpretation of any provision hereof (a “Dispute”), the parties shall use the
following procedure in good faith prior to either party pursuing other
available judicial or non-judicial remedies:


 


(a) A party raising a Dispute shall provide
written notice of such Dispute to the other party identifying such Dispute in
reasonable detail and proposing a reasonable solution to such Dispute. A
meeting shall be held between the parties within ten (10) days after a party
receives such written notice of a Dispute. The meeting shall be attended by a
representative of each party having decision-making authority regarding the
Dispute, to attempt in good faith to negotiate a reasonable resolution of the
Dispute;


 


(b) If within thirty (30) days after receipt
of notification of the Dispute by either party, the parties have not succeeded
in negotiating a resolution to the Dispute, the Dispute shall be determined and
settled exclusively by a panel of three (3) neutral arbitrators (“the
Arbitration Panel”) selected in accordance with this Section 8 and the rules of
the Arbitration Act 1996. Each party shall select one (1) neutral arbitrator (a
“Party Appointed Arbitrator”) and the Party Appointed Arbitrators shall select
the third neutral arbitrator (together an “Arbitration Panel”) in accordance
with such Rules as may apply to such arbitration. A majority of the Arbitration
Panel is required for all Arbitration Panel decisions or recommendations. The
place of arbitration shall be a mutually agreed venue within the Europe. The
Arbitration Panel shall recommend a resolution of the Dispute in writing to
each party. The recommendation provided by the Arbitration Panel shall be final
and binding and judgment may be entered on the Arbitration Panel’s award in any
court having jurisdiction of the Dispute. In the event of arbitration, the
costs related to such proceedings, including legal and travel costs will be
included in the award to the prevailing party. The Arbitration Panel may only
award actual damages, and shall not have the right to award any other damages,
including, without limitation, punitive, incidental or consequential damages.
Notwithstanding the foregoing, nothing in this Section shall preclude either
party from seeking interim or provisional relief, in the form of a temporary
restraining order, preliminary injunction, or other interim equitable relief
concerning a dispute, either prior to or during the Dispute resolution process,
if necessary to protect the interests of such party.


 


9.
MISCELLANEOUS


 


9.1
Independent Contractors


 


For purposes of this Agreement, except as
expressly provided in Section3.2, the parties agree that they are and will be
acting solely as independent contractors and nothing contained in this
Agreement is intended or shall be construed to place them in the relationship
of partners, principal and agent, employer/employee or joint ventures, nor to
give either party the authority to legally bind the other party, and neither
party shall hold itself out as having such authority.


 


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9.2
Amendments


 


This Agreement may not be amended or modified
in any manner except by an instrument in writing signed by both of the parties
hereto.


 


9.3
Entire Agreement


 


This Agreement (including the Appendices
hereto) constitutes the entire agreement of the parties with respect to the
subject matter hereof, and it supercedes all prior oral and written agreements,
commitments or understandings with respect to the matters provided for herein,
including without limitation any memorandum of understanding, letter of intent
or letter of agreement. In the event of any conflict between the terms of this
Agreement and any Appendix hereto, the terms of this Agreement shall govern.


 


9.4
Governing Law


 


This Agreement and the performance hereof
shall be governed, interpreted, construed and regulated by the laws of The
Netherlands.


 


9.5
Notices


 


All notices, demands, requests, or other
communications that may be or are required to be given, served, or sent by any
party to any other party pursuant to this Agreement shall be in writing and
shall be mailed by first-class, registered or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery (including delivery
by courier) or by facsimile transmission, addressed as follows:


 


	
  If to Axonyx:

  	
   

  	
  If to JSW:

  
	
   

  	
   

  	
   

  
	
  Bilderdijkstraat 9

  	
   

  	
  JSW Research

  
	
  2311 XD Leiden

  	
   

  	
  Rankengasse 28

  
	
  Netherlands

  	
   

  	
  Graz A-8020

  
	
  Telephone: 
  +31 (0)71 589 3463

  	
   

  	
  Austria

  
	
  Facsimile: 
  +31 (0)71 589 3161

  	
   

  	
  Telephone: +43 (0) 316 76511411 

  
	
  Attn: G. B. Bruinsma MD

  	
   

  	
  Facsimile: +43 (0) 316 7675 1144

  
	
  With a copy to: M S Hausman MD

  	
   

  	
  Attn: Dr. Manfred Windisch

  
	
   

  	
   

  	
  With a copy to: Dr Robert Wronski

  



 


Each party may designate by notice in writing
a new address to which any notice, demand, request or communication may
thereafter be so given, served or sent. Each notice, demand, request, or
communication which shall be mailed, delivered or transmitted in the manner
described above shall be deemed sufficiently given, served, sent and received for
all purposes at such time as it is delivered to the addressee (with the return
receipt, the delivery receipt, the affidavit of messenger or (with respect to a


 


15

















 


facsimile transmission) the electronic receipt
being deemed conclusive (but not exclusive) evidence of such delivery) or at
such time as delivery is refused by the addressee upon presentation. In the
case of notices sent by facsimile transmission, which notice shall be deemed
duly given if made pursuant to the provisions of this Section 8.7 above, the
notifying party shall also send a confirmation copy of any such notice to the
other party by first class-mail.


 


9.6
Severability


 


In the event that any term of this Agreement
is held to be invalid, illegal, or unenforceable, such invalidity, illegality,
or unenforceability shall not affect any other portion of this Agreement, and
there shall be deemed substituted therefore such term as will most fully
realize the intent of the parties as expressed in this Agreement to the fullest
extent permitted by applicable law, the parties hereby declaring their intent
that this Agreement be construed in such fashion as to maintain its existence,
validity, and enforceability to the greatest extent possible.


 


9.7 Survival


 


Neither expiration nor termination of this
Agreement shall terminate those obligations and rights of the parties pursuant
to this Agreement which by their terms are intended to survive and such
provisions shall survive the expiration or termination of this Agreement.
Without limiting the generality of the foregoing, the following provisions of
this Agreement shall survive any expiration or termination hereof: Articles 4,
6, 7, 8 and 9 and all definitional provisions of this Agreement corresponding to
the foregoing.


 


9.8
Waiver


 


Neither the waiver by any of the parties
hereto of a breach of or a default under any of the provisions of this
Agreement, nor the failure of any of the parties, on one or more occasions, to
enforce any of the provisions of this Agreement or to exercise any right or
privilege hereunder shall thereafter be construed as a waiver of any subsequent
breach or default of a similar nature, or as a waiver of any of such
provisions, rights or privileges hereunder. No waiver by the a party hereto of,
or consent by a party hereto to, a variation from any provision of this
Agreement shall be effective unless made in a written instrument duly executed
on behalf of such party.


 


9.9
Assignment


 


This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their successors and assigns.
Neither party may transfer or assign this Agreement or its obligations
thereunder to a third party other than an affiliate or subsidiary or such party
without the other party’s prior written consent. Notwithstanding the foregoing,
Axonyx will transfer or assign its rights and obligations under this Agreement,
without consent, to a successor to all or substantially all of its business or
assets relating to this Agreement


 


16

















 


whether by sale, merger, operation of law or
otherwise. Any assignment not in conformance with this Section 9.9 shall be
null, void and of no legal effect.


 


9.10
Additional Actions and Documents


 


Each of the parties hereto hereby agree to
take or cause to be taken such further actions, to execute, deliver and file or
cause to be executed, delivered and filed such further documents and
instruments, and to obtain such consents, as may be necessary or as may be
reasonably requested in order to fully effectuate the purposes, terms and
conditions of this Agreement.


 


9.11 Publicity


 


Neither party shall use the name of the other
party, its affiliates or subsidiaries, or any of their products, promotions,
public statements or public disclosures, with the exception of legally required
reporting requirements, without the prior express written consent of an
authorized representative of the other party.


 


9.12
Counterparts


 


To facilitate execution, this Agreement may
be executed in as many counterparts as may be required. It shall not be
necessary that the signature of or on behalf of each party appears on each
counterpart, but it shall be sufficient that the signature of or on behalf of
each party appears on one or more of the counterparts. All counterparts shall
collectively constitute a single agreement. It shall not be necessary in any
proof of this Agreement to produce or account for more than a number of
counterparts containing the respective signatures of or on behalf of all of the
parties.


 


9.13
Headings


 


The headings of this Agreement are for ease
of reference only and shall not limit or otherwise affect the meaning of the
terms and conditions of this Agreement.


 


9.14 It is understood that all materials and
information provided hereunder are experimental in nature. Axonyx makes no
warranties, express or implied, including without limitation any of the implied
warranties of merchantability, fitness for a particular purpose and
non-infringement regarding any materials and/or any information provided
hereunder. Additionally, Axonyx makes no representations of any kind, express
or implied, regarding the safety or efficacy with respect to such materials
and/or information.


 


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IN
WITNESS WHEREOF, the parties hereto have duly executed
this Agreement, or have caused this Agreement to be duly executed on their
behalf, as of the Effective Date.


 


 


	
  AXONYX, INC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Gosse B. Bruinsma, M.D.

  	
   

  	
   

  
	
  By: Gosse B Bruinsma MD

  	
   

  
	
   

  	
   

  
	
  Title: Chief Operating Officer

  	
   

  
	
   

  	
   

  
	
  Date:  March 21

  	
   

  
	
   

  	
   

  
	
  JSW Research

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Manfred
  Windisch, Ph.D.

  	
   

  	
   

  
	
  By: Manfred
  Windisch, Ph.D.

  	
   

  
	
   

  	
   

  
	
  Title: CEO
  and President

  	
   

  
	
   

  	
   

  
	
  Date: March
  21, 2003

  	
   

  



 


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