is not required to continue
to perform and will cease performing all Manufacturing and supply obligations
and efforts with respect to the Licensed Compound and Terminated Product, except
as set forth in this Termination Agreement as follows:
a.Sanofi-Aventis agrees to transfer ownership and deliver to Lexicon or its
designee Sanofi-Aventis' existing inventory of Terminated Product, active
pharmaceutical ingredient, intermediates and other compounds, packaging,
labeling and other materials and associated documentation relating to or
otherwise useful for the Manufacture of the Licensed Compound and Terminated
Product identified in Schedule C ("Inventory"), in each case at no cost to
Lexicon and in accordance with cGMP shipping standards. Within [**] days of the
Settlement Date, Lexicon will provide notice to Sanofi-Aventis of its desired
destination for delivery of such Inventory, and Sanofi-Aventis will ship such
Inventory in accordance with such notice as soon as practicable. Sanofi-Aventis
is obligated to ship Inventory at its cost only to the extent such Inventory is
stored at Sanofi-Aventis-owned sites. Sanofi-Aventis is not obligated to ship
Inventory at its cost if stored by its vendors, manufacturers or suppliers.
Notwithstanding the foregoing, Sanofi is not obligated to pay and Lexicon agrees
to pay all taxes and duties associated with any shipping undertaken by Sanofi
pursuant to this
Paragraph. The Parties agree that Sanofi-Aventis represents and covenants that
all such Inventory stored at Sanofi-Aventis-owned sites was Manufactured and
will be maintained through delivery to Lexicon in accordance with Applicable Law
and the applicable specifications therefor, including, to the extent required by
Applicable Law, cGMP; provided, however, if the Inventory at
Sanofi-Aventis-owned sites is damaged or does not meet applicable specifications
due to Sanofi-Aventis' gross negligence or willful misconduct, Sanofi-Aventis
shall pay the reasonable replacement cost of such Inventory to Lexicon. Sanofi
further represents that all Inventory Manufactured by third party vendors,
manufacturers and suppliers was so Manufactured pursuant to contracts identified
in Schedule D and subject to assignment to Lexicon hereunder.
b.Sanofi-Aventis agrees, at its sole expense, to transfer to Lexicon or its
designee all technology, know-how documentation, and other written information
in its possession or control which is necessary or used by Sanofi-Aventis to
perform the Manufacturing Process, including, without limitation, with respect
to any formulation development activities (the "Technology Transfer"). Sanofi
shall use Commercially Reasonable Efforts to ensure the Technology Transfer
occurs as soon as practicable.
c.At Lexicon's request, it may assume all contractual rights and obligations
through direct assignment by Sanofi-Aventis of existing vendor and service
contracts related to Manufacturing and supply of the Licensed Compound and
Terminated Product; provided, that Sanofi-Aventis will remain responsible for
all financial obligations thereunder until such assignment to Lexicon.
Sanofi-Aventis represents that all such contracts are identified in Schedule D
(the "Manufacturing Contracts") and that there are no amounts due and owing
under those contracts at the time of assignment to Lexicon and that all payments
have been made for Manufacturing performed and Manufacturing obligations
incurred prior to the time of assignment. Subject to Lexicon's prior written
consent, at Sanofi-Aventis'