PRINCIPAL INTELLECTUAL PROPERTY AGREEMENT

 

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                                                                    EXHIBIT 10.8

 

                                                                  EXECUTION COPY

 

                         INTELLECTUAL PROPERTY AGREEMENT

 

                                     BETWEEN

 

                           ALCAN INTERNATIONAL LIMITED

 

                                       AND

 

                                  NOVELIS INC.

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                                TABLE OF CONTENTS

 

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1.0 PREAMBLE...............................................................    1

 

2.0 DEFINITIONS............................................................    1

 

3.0 TRANSFER OF TECHNOLOGY.................................................    7

 

4.0 LICENSE RIGHTS GRANTED.................................................   10

 

5.0 EXCLUDED TECHNOLOGY....................................................   12

 

6.0 TERMINATION OF PARTICIPATION IN JTA....................................   14

 

7.0 PROTECTION OF INFORMATION..............................................   15

 

8.0 TERM AND TERMINATION...................................................   17

 

9.0 SURVIVAL OF OBLIGATIONS................................................   19

 

10.0 REPRESENTATIONS.......................................................   19

 

11.0 DISCLAIMER............................................................   19

 

12.0 TRADEMARK, TRADE NAME AND LOGO........................................   20

 

13.0 NON-WAIVER............................................................   20

 

14.0 NO PARTNERSHIP, JOINT VENTURE.........................................   20

 

15.0 FURTHER ASSURANCES, CONSENTS, ETC.....................................   21

 

16.0 NOTICES...............................................................   21

 

17.0 ASSIGNMENT............................................................   22

 

18.0 INDEMNIFICATION.......................................................   22

 

19.0 ENTIRE AGREEMENT, AMENDMENTS..........................................   24

 

20.0 DISPUTE RESOLUTION....................................................   25

 

21.0 MISCELLANEOUS.........................................................   25

 

22.0 GOVERNING LAW.........................................................   26

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                         INTELLECTUAL PROPERTY AGREEMENT

 

This Intellectual Property Agreement is entered into with effect as of the

Effective Date.

 

BETWEEN:   Alcan International Limited, a Canadian corporation having its head

           office at 1188 Sherbrooke Street West, Montreal, Quebec, Canada

           (hereinafter referred to as "ALCANINT")

 

AND:       Novelis Inc., a Canadian corporation having its registered office at

           1188 Sherbrooke Street West, Montreal, Quebec, Canada (hereinafter

           referred to as "NOVELIS ") acting as principal and as agent for other

           members of Novelis Group, as herein provided.

 

WHEREAS, Alcanint is a wholly-owned subsidiary of Alcan; and

 

WHEREAS, Alcan Inc. and Novelis have entered into the Separation Agreement with

effect as of the Effective Date, which provides, among other things, for the

transfer of certain assets from Alcan to Novelis and the assumption by Novelis

of certain liabilities in connection with the distribution of common shares of

Novelis to Alcan shareholders and the execution and delivery of certain other

agreements, including this Agreement; and

 

WHEREAS Alcanint owns and manages certain technology on behalf of and for the

benefit of Alcan and its Affiliates and desires to transfer or license to

Novelis certain rights in technology owned by it;

 

WHEREAS a further purpose of this Agreement is to achieve compliance with

regulatory requirements in respect of the separation of certain aluminum rolling

assets from Alcan in a manner which allows them to continue to be viable;

 

NOW THEREFORE, in consideration of the foregoing and the mutual agreements set

forth below, and other good and valuable consideration, the receipt and adequacy

of which is hereby acknowledged, the parties hereto agree as follows:

 

1.0  PREAMBLE

 

     The preamble hereto shall be considered an integral part of this Agreement.

 

2.0  DEFINITIONS

 

     2.1  "AEROSPACE INDUSTRY" shall mean the production of aircraft,

          spacecraft, satellites and similar craft for manned or unmanned

          flight;

 

     2.2  "AFFILIATE" shall mean, with respect to any corporation, association

          or other business entity, any other entity directly or indirectly

          controlling, controlled by or

 

 

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          under common control with such specified corporation, association or

          entity. For purposes of this definition, "control" (including, with

          correlative meanings, the terms "controlling," "controlled by" and

          "under common control with"), means the possession, directly or

          indirectly, of the power to direct or cause the direction of

          management or policies, whether through the ownership of voting

          securities, by agreement or otherwise; provided, however, that

          beneficial ownership of 10% or more of the securities or other

          interest entitled to vote generally in the election of directors shall

          be deemed to be control;

 

     2.3  "AGREEMENT" shall mean this Intellectual Property Agreement and all

          other documents that are made a part hereof;

 

     2.4  "ALCAN" shall mean Alcan Inc., a Canadian corporation;

 

     2.5  "ALCAN GROUP COMPANY" shall mean Alcan or any entity of which a

          majority of the total voting power of capital stock or other interests

          entitled (without regard to the occurrence of any contingency) to vote

          in the election of directors, managers or trustees thereof is at the

          time owned or controlled, directly or indirectly, by Alcan;

 

     2.5A "ARRANGEMENT" shall have the meaning ascribed to such term in the

          Separation Agreement;

 

     2.6  "AUTOMOTIVE SHEET" shall mean aluminum Sheet products destined or

          intended for use in or principally related to the production of inner

          and outer body panels (including closures, skin, hoods, deckslids and

          fenders) and Sheet-based body-in-white structures for road vehicles;

 

     2.7  "AUTOMOTIVE SHEET PATENTS" shall mean the patents and patent

          applications in respect of Automotive Sheet as listed in Appendix ASP;

 

     2.8  "COCAST TECHNOLOGY" shall mean the Technology originally developed by

          Wagstaff Inc. and further developed by Alcan Group Companies,

          primarily at the Solatens Facility, related to the casting of

          composite ingots with distinct regions having different alloy

          compositions as generally described in the patents and patent

          applications listed in Appendix CCT;

 

     2.9  "DESIGNATED PATENTS" shall mean patents and patent applications owned

          by Alcanint and listed in Appendix DP;

 

     2.10 "EFFECTIVE DATE" shall mean the Effective Date as defined in the

          Separation Agreement;

 

     2.11 "EXCLUDED TECHNOLOGY" shall mean the Technology described in Section

          5.1;

 

 

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     2.12 "FLEXCAST TECHNOLOGY" shall mean the Technology specific to continuous

          casting of a thin strip between two chilled metallic belts as

          generally described in the patents and patent applications listed in

          Appendix FCT;

 

     2.13 "FLEXSTREME TECHNOLOGY" shall mean the Technology and equipment

          designs originally developed by Wagstaff Inc. and further developed by

          Alcan Group Companies, primarily at the Solatens Facility, related to

          the horizontal direct chill casting of small diameter ingots suitable

          for use as forging stock as generally described in the patents and

          patent applications listed in Appendix FST;

 

     2.14 "INSITU HOMOGENIZATION TECHNOLOGY" shall mean ***.

 

     2.15 "JOINT TECHNOLOGY AGREEMENTS" or "JTAS" shall mean the Agreements

          between Alcanint and various other Alcan Group Companies for joint

          research and technical assistance in the field of aluminum and other

          materials fabricating and/or aluminum reduction and/or the production

          of raw materials for the production of aluminum and/or manufacturing

          packaging using aluminum foil and other materials;

 

     2.16 "LICENSED PATENTS" shall mean the patents and patent applications

          listed in Appendix LP;

 

     2.17 "LICENSED EQUIPMENT PATENTS" shall mean the patents and patent

          applications listed in Appendix LEP;

 

     2.18 "LICENSED TECHNOLOGY" shall mean any and all, copyrights, trade

          secrets, information, data, inventions, designs and similar rights

          that have been used or developed, or are being used or developed for

          use by Novelis or any Novelis Subsidiaries on or immediately before

          the Effective Date for or in connection with the use and exploitation

          of any one of the facilities that form part of Novelis as of the

          Effective Date that are related to the following:

 

               -    Sheet ingot casting and metallurgy and associated melting,

                    metal cleaning, molten metal delivery, quality measurement

                    and environmental technologies;

 

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***  Certain information on this page has been omitted and filed separately with

     the Securities and Exchange Commission. Confidential treatment has been

     requested with respect to the omitted portions.

 

 

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               -    laminated products as pursued as of the Effective Date at

                    the Ohle, Ludensheid, Berlin, Bridgnorth or Etobicoke foil

                    operations of Alcan;

 

               -    Technology specific to the production of rolled Plate with a

                    thickness of less than 12mm to the extent that such

                    technology was in use immediately prior to the Effective

                    Date at manufacturing facilities that will form a part of

                    Novelis as of the Effective Date;

 

               -    the Ouro Preto/Aratu/Petrocoque Technology;

 

          Licensed Technology shall also include all Technology related to

          management systems and business processes including environment health

          and safety, value based management, continuous improvement, production

          scheduling and management and individual performance and career

          management and all business forms, contract forms, and other written

          and electronic business materials used by Novelis or a Novelis

          Subsidiary prior to the Effective Date subject in each case to Novelis

          obtaining at its sole cost any necessary consents, provided that all

          such Technology and materials have been modified as necessary to

          delete any reference to brand names, trademarks, service marks being

          retained by Alcan Group Companies.

 

     2.19 "NETCAST TECHNOLOGY" shall mean the Technology originally developed by

          Wagstaff Inc. and further developed by Alcan Group Companies,

          primarily at the Solatens Facility, related to the direct chill

          casting of complex shapes certain aspects of which are described in

          the patents and patent applications listed in Appendix NCT;

 

     2.19A "NOVELIS GROUP" means Novelis and the Novelis Subsidiaires.

 

     2.20 "NOVELIS SUBSIDIARY" shall mean, as of and from the Effective Date,

          (i) Petrocoque S.A. - Industria E Comercio, Aluminium Norf GmbH and

          Logan Aluminum Inc, in each case for so long as Novelis retains at

          least its current ownership stake in such entity and (ii) any other

          entity of which a majority of the total voting power of capital stock

          or other interests entitled (without the occurrence of any

          contingency) to vote in the election of directors, managers or

          trustees thereof is at the time owned or controlled, directly or

          indirectly by Novelis;

 

     2.21 "OURO PRETO/ARATU/PETROCOQUE TECHNOLOGY" shall mean the Technology

          employed in the operations of any one or more of the facilities known

          as Ouro Preto, Aratu and Petrocoque as of the Effective Date. Ouro

          Preto is a bauxite mine, alumina refinery and aluminum smelter, Aratu

          is an aluminum smelter with an associated electricity generating

          facility; and Petrocoque is a facility that produces calcined

          petroleum coke;

 

 

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     2.21A "PECHINEY" means Pechiney, a wholly-owned subsidiary of Alcan,

          together with all entities that were subsidiaries of Pechiney when

          Pechiney became a subsidiary of Alcan, in December 2003.

 

     2.22 "PAE TWIN ROLL CASTING TECHNOLOGY" shall mean Technology specific to

          the continuous casting of a relatively thin metal strip between two

          chilled rolls which is marketed by Pechiney Aluminium Engineering

          certain aspects of which are described in the patents and patent

          applications listed in Appendix TRCT;

 

     2.23 "PAE METAL TREATMENT TECHNOLOGY" shall mean Technology specific to the

          melting, holding and casting of aluminum, treatments of molten

          aluminum to remove hydrogen, solid and liquid inclusions and alkali

          metal and related equipment namely IRMA, JetCleaner, Alpur, PDBF, CCF

          and Autopak which is marketed by Pechiney Aluminium Engineering as of

          the Effective Date, certain aspects of which are described in the

          patents and patent applications listed in Appendix MTT;

 

     2.24 "PLATE" shall mean rolled and/or cast aluminum product with a

          thickness of greater than 6.5mm that is not intended for further

          rolling to a thickness of 6.5mm or less (reroll);

 

     2.25 "ROLLED PRODUCTS" means rolled aluminum products in the form of Foil,

          Sheet and rolled Plate of a thickness of less than 12 mm;

 

     2.26 "SECONDARY INTELLECTUAL PROPERTY AGREEMENT" shall mean that other

          Intellectual Property Agreement of even date herewith between Novelis

          as party of the first part and Alcanint as party of the second part;

 

     2.27 "SEPARATION AGREEMENT" shall mean the Separation Agreement herewith

          between Alcan and Novelis, as described in the Preamble to this

          Agreement;

 

     2.28 "SHEET" and "FOIL" shall have the same meaning as is commonly ascribed

          to those expressions in the aluminum industry in reference to rolled

          aluminum provided that it is of a thickness of 6.5mm or less;

 

     2.29 "SOLATENS FACILITY" shall mean the facility in Spokane, Washington

          known as Solatens;

 

     2.30 "TECHNOLOGY" shall mean any and all patents, patent applications,

          copyrights, trade secrets, information, data, inventions, designs,

          manufacturing processes, know-how, technical information,

          specifications, creative works and similar rights either conceived or

          first reduced to practice on or before the Effective Date that are

          owned, licensable or otherwise under the control and direction of

 

 

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          Alcanint or any other Alcan Group Company before the Effective Date,

          including Novelis Subsidiaries;

 

     2.31 "TRANSFERRED TECHNOLOGY" shall mean the Technology described in

          Section 3.1; and

 

     2.32 "UNRESTRICTED LICENSED TECHNOLOGY" shall mean any and all, copyrights,

          trade secrets, information, data, inventions, designs and similar

          rights that have been used or developed, or are being used or

          developed for use in connection with research, development,

          production, marketing or sale of Rolled Products by Novelis or any

          Novelis Subsidiary on or immediately before the Effective Date or in

          connection with the use and exploitation of any of the facilities

          owned or operated by Novelis or a Novelis Subsidiary as of the

          Effective Date that are freely licensable by Alcanint or any Alcan

          Group Company and related to the following:

 

               -    Recycling aluminum, scalping, homogenization and preheating

                    technology, hot rolling, cold rolling, foil rolling,

                    coiling, cooling and lubrication, continuous and batch heat

                    treatment, quenching, mechanical finishing, slitting,

                    cutting to length, laser blanking and all associated

                    technologies (e.g. profile, gauge and shape measurement and

                    control and pollution reduction and control);

 

               -    Mechanical finishing, surface texturing, chemical

                    pre-treatment, painting, lacquering and curing technologies

                    for Sheet and Foil;

 

               -    Metallurgy related to the properties and microstructural

                    evolution through continuous casting, hot rolling, coiling,

                    cooling, cold rolling, foil rolling, heat-treatment,

                    quenching, mechanical finishing, and downstream finishing

                    and fabrication processes for sheet, foil and sheet ingot

                    applied internally or by customers for Sheet and Foil (e.g.

                    forming, rolling, painting and lacquering, curing and

                    etching of Sheet and Foil);

 

               -    Manufacture of rigid and semi-rigid aluminum foil containers

                    and closures;

 

               -    Metal property and alloy composition specifications related

                    to Rolled Products;

 

               -    In-service sheet and foil product performance in terms of

                    mechanical property changes, corrosion (bare and surface

                    treated Sheet) in final applications;

 

 

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               -    All process simulation models, scheduling and productivity

                    models and historic information to the extent recorded and

                    relevant to the Licensed Technology, Unrestricted Licensed

                    Technology or Transferred Technology;

 

               -    Enabling Technologies and know-how related to processes and

                    application of aluminum Rolled Products materials used by

                    customers (e.g. AVT automotive body-in-white assembly

                    process, spot welding, adhesive bonding, riveting

                    technologies, etching and finishing, structural simulation

                    models pertinent to applications); and

 

               -    Technology for the production of Foil to the extent it is

                    being used or has been used under existing or past practices

                    at the former Pechiney Annecy, Rugles, Dudelange and

                    Flemalle sites for the sole purpose of painting Sheet or

                    producing circles from Sheet or producing Foil.

 

               -    Technology specific to making and using the inventions

                    claimed in the Designated Patents and the Automotive Sheet

                    Patents;

 

               -    All other Technology, other than Excluded Technology, that

                    is in use or held for use as of the Effective Date in

                    connection with the research, development, production,

                    marketing or sale of Rolled Products at the facilities of

                    Novelis and the Novelis Subsidiaries as of the Effective

                    Date subject to Alcanint's right, upon reasonable request,

                    to be informed as to the identity, scope and use of such

                    other Technology;

 

     2.33 In the event of any ambiguity as to the inclusion of a particular

          Technology within Excluded Technology, Licensed Technology,

          Transferred Technology, or Unrestricted Licensed Technology, such

          Technology still be allocated in the following order of preference:

          (1) Transferred Technology; (2) Excluded Technology; (3) Licensed

          Technology; and (4) Unrestricted Licensed Technology.

 

3.0  TRANSFER OF TECHNOLOGY

 

     3.1  Alcanint hereby grants, conveys, transfers and assigns and agrees to

          deliver (and agrees to cause any appropriate Alcan Group Company to

          grant, convey, transfer, assign and agree to deliver) to Novelis, in

          its capacity as principal for the sole purpose of acquiring legal

          title therein, and in its capacity as agent for the relevant members

          of Novelis Group for the purpose of acquiring all beneficial ownership

          therein and for all other purposes, all right, title and interest, of

          whatever nature or kind throughout the world of Alcanint or any Alcan

          Group Company in and to the following:

 

 

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          3.1.1 the Designated Patents;

 

          3.1.2 the Automotive Sheet Patents and related Technology which is

               only useful in the production of Automotive Sheet and which

               originated: (i) without use of or reference to Technology owned

               or developed by Pechiney, and (ii) within a business unit or

               manufacturing facility that will be owned by Novelis Group as of

               the Effective Date;

 

          3.1.3 Technology that is only useful in the production of beverage can

               body Sheet, beverage can end Sheet and tab stock (for beverage

               cans) which originated: (i) without use of or reference to

               Technology owned or developed by Pechiney, and (ii) within any

               business unit or manufacturing facility that will form part of

               Novelis as of the Effective Date;

 

          3.1.4 NetCast Technology, CoCast Technology, FlexStreme Technology and

               Insitu Homogenisation Technology;

 

          3.1.5 PAE Twin Roll Casting Technology and FlexCast Technology, in

               both cases subject to Schedule FT;

 

          3.1.6 PAE Metal Treatment Technology;

 

          3.1.7 the right to grant licenses and rights under and with respect to

               any of the foregoing and to sue for any infringement occurring

               before or after the Effective Date as well as all statutory,

               contractual and other claims, demands and causes of action for

               royalties, fees or other income from, or infringement,

               misappropriation or violation of, any of the foregoing, and all

               of the proceeds from the foregoing that are accrued and unpaid as

               of, and/or accruing after, the Effective Date;

 

          3.1.8 all causes of action and rights of recovery against third

               parties for past infringement in and to the Transferred

               Technology, and for past misappropriation by third parties of

               trade secrets in and to the Transferred Technology; and

 

          3.1.9 the right to apply for and obtain statutory rights and

               registrations with respect to any of the foregoing Technology.

 

     3.2  The foregoing transfer and assignment shall be subject to the licenses

          granted to Alcanint and other Alcan Group Companies pursuant to the

          Secondary Intellectual Property Agreement.

 

     3.3  If and to the extent that, as a matter of law in any jurisdiction,

          ownership, title, or any rights of interest in or to any of the

          Transferred Technology cannot be assigned as provided in Section 3.1,

          (i) Alcanint agrees subject to the other

 

 

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          terms and conditions of this Agreement to assign and transfer, and

          hereby assigns and transfers to Novelis (as agent for the relevant

          member of Novelis Group) all rights (including, without limitation,

          all economic and commercialization rights) that can be assigned

          pursuant to Section 3.1 to the fullest extent permissible; and (ii)

          Alcanint agrees subject to the other terms and conditions of this

          Agreement to grant, and hereby grants, Novelis (as agent for the

          relevant member of Novelis Group) an unlimited, exclusive,

          irrevocable, worldwide, perpetual, royalty-free license, to use,

          exploit and commercialize in any manner now known or in the future

          discovered and for whatever purpose, any rights to Transferred

          Technology that cannot be assigned as contemplated by Section 3.1.

 

     3.4  Alcanint further covenants that it will, without demanding any further

          consideration therefor, at the request and expense of Novelis (except

          for the value of the time of Alcanint employees), do (and cause Alcan

          Group Companies to do) all lawful and just acts that may be or become

          necessary for evidencing, maintaining, recording and perfecting

          Novelis' rights to such Transferred Technology consistent with Alcan's

          general business practice as of the Effective Date, including but not

          limited to, execution and acknowledgement of (and causing Alcan Group

          Companies to execute and acknowledge) assignments and other

          instruments in a form reasonably required by Novelis for each relevant

          jurisdiction.

 

     3.5  Alcanint and each other Alcan Group Company shall retain any

          Technology not transferred to Novelis by virtue of the foregoing.

          Novelis warrants to Alcanint that neither it nor any Novelis

          Subsidiary owns any Technology (other than the Transferred Technology

          and only to the extent conveyed hereunder) as of the Effective Date

          and further acknowledges that any other Technology that it or any

          Novelis Subsidiary may be deemed to have owned prior to the Effective

          Date was intended to be owned by Alcanint and shall be deemed to have

          been held by Novelis or such Novelis Subsidiary for the benefit of

          Alcanint. This provision shall not apply to that Technology described

          in the final paragraph of Section 2.18.

 

     3.6  Each of Alcanint and Novelis shall deliver to the other all documents

          and instruments necessary or appropriate to be duly executed where

          appropriate by the applicable party(ies) and notarized where indicated

          in the exhibits to this Agreement.

 

     3.7  Novelis acknowledges and agrees that the foregoing assignment is

          subject to any and all licenses or other rights that may have been

          granted by Alcanint or any other Alcan Group Company with respect to

          the Transferred Technology prior to the Effective Date.

 

 

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     3.8  The determination regarding which Novelis Group company (sometimes

          referenced in this Agreement as the "relevant member of Novelis

          Group") shall be entitled to beneficial ownership of Transferred

          Technology or to a license of Licensed Patents, Unrestricted Licensed

          Technology or Licensed Technology shall be made having regard to the

          following factors:

 

          3.8.1 whether the relevant member of Novelis Group was a party to any

               JTA while such entity was an Alcan Group Company;

 

          3.8.2 whether the relevant member of Novelis Group reasonably requires

               the relevant beneficial ownership or license in connection with

               the ownership or operation of one or more of its businesses on

               and after the Effective Date, based on the use of Technology in

               connection with such business prior to the Effective Date; and

 

          3.8.3 such other factors as may reasonably be taken into account by

               Novelis and as are consistent with the provisions of this

               Agreement.

 

     3.9  Novelis covenants that it will enter into such agreements with the

          relevant members of Novelis Group as may be necessary or desirable for

          the orderly management of the Technology mentioned in section 3.8.

 

4.0  LICENSE RIGHTS GRANTED

 

          4.1.1 Alcanint hereby grants to Novelis and Novelis hereby accepts, as

               agent for the relevant members of Novelis Group and subject to

               the terms and conditions of this Agreement a royalty free license

               to use and commercialize the Licensed Patents, Unrestricted

               Licensed Technology and Licensed Technology to operate, maintain,

               repair, reconstruct, rebuild and expand any present or future

               facilities of Novelis Group and to use and sell the products

               produced using the Licensed Patents, Unrestricted Licensed

               Technology and/or the Licensed Technology pursuant thereto world

               wide; provided that the royalty free license in respec