SECONDARY INTELLECTUAL PROPERTY AGREEMENT

 

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                                                                  EXECUTION COPY

 

                                                                    EXHIBIT 10.9

 

                         INTELLECTUAL PROPERTY AGREEMENT

 

                                     BETWEEN

 

                                  NOVELIS INC.

 

                                       AND

 

                           ALCAN INTERNATIONAL LIMITED

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                                TABLE OF CONTENTS

 

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

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

3.0 LICENSE RIGHTS GRANTED ................................................    4

4.0 ROYALTY AND ROYALTY PAYMENT ...........................................    7

5.0 TECHNICAL ASSISTANCE ..................................................    7

6.0 PROTECTION OF INFORMATION .............................................    7

7.0 TERM AND TERMINATION ..................................................    9

8.0 SURVIVAL OF OBLIGATIONS ...............................................   10

9.0 REPRESENTATIONS .......................................................   10

10.0 DISCLAIMER ...........................................................   10

11.0 TRADEMARK, TRADE NAME AND LOGO .......................................   11

12.0 NON-WAIVER ...........................................................   11

13.0 NO PARTNERSHIP, JOINT VENTURE ........................................   11

14.0 FURTHER ASSURANCES, CONSENTS, ETC ....................................   11

15.0 NOTICES ..............................................................   11

16.0 ASSIGNMENT ...........................................................   12

17.0 INDEMNIFICATION ......................................................   12

18.0 ENTIRE AGREEMENT, AMENDMENTS, ETC ....................................   14

19.0 DISPUTE RESOLUTION ...................................................   15

20.0 MISCELLANEOUS ........................................................   15

21.0 GOVERNING LAW ........................................................   15

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                         INTELLECTUAL PROPERTY AGREEMENT

 

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

Effective Date.

 

BETWEEN: 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 the

         other members of Novelis Group, as herein provided.

 

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

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

         (hereinafter referred to as "ALCANINT")

 

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

 

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

     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 the holders

     of the common shares of Alcan and the execution and delivery of certain

     other agreements including this Agreement; and

 

     WHEREAS Alcanint has pursuant to the Principal Intellectual Property

     Agreement (as defined below) entered into, transferred and assigned

     ownership of certain Technology to Novelis and desires to retain certain

     rights in respect thereof;

 

     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

 

          As used herein, the following terms shall have the following meanings:

 

     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 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

 

 

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          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" means 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 or at the

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

 

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

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

          panels (including closures, skin, hoods, decks, lids 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  "EFFECTIVE DATE" shall mean the Effective Date as defined in the

          Separation Agreement;

 

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

          casting of a thin strip between two chilled metallic belts and as

          generallydescribed in the patents and patent applications listed in

          Appendix FCT;

 

     2.11 "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;

 

     2.12 "INSITU HOMOGENIZATION TECHNOLOGY" shall mean ***;

 

     2.13 "LICENSED NOVELIS PATENTS" shall mean the patents and patent

          applications listed on Appendix LNP;

 

     2.14 "LICENSED NOVELIS TECHNOLOGY" shall mean the technology licensed by

          Novelis to Licensee pursuant to Section 3.1.hereof;

 

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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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     2.15 "LICENSEE" shall mean Alcanint or any of its Affiliates as determined

          by the context or as otherwise designated for any particular purpose

          by Alcanint, provided that an Alcan Group Company other than Alcan or

          Alcanint shall be a Licensee under this Agreement only if such company

          agrees to be bound by the terms of this Agreement and provided further

          that Alcanint shall remain liable for license related obligations on a

          joint and several basis for any of its Affiliates as determined by the

          context or as otherwise designated for any particular purpose by

          Alcanint.

 

     2.16 "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 as more particularly described in the

          patents and patent applications listed in Appendix NCT;

 

     2.17 "NOVELIS GROUP" shall mean Novelis and the Novelis subsidiaires.

 

     2.18 "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;

 

     2.19 "NOVELIS TECHNOLOGY" shall mean any and all patents, patent

          applications, copyrights, trade secrets, information, data,

          inventions, designs and similar rights either conceived or first

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

          licensable by Novelis or under the control of Novelis pursuant to the

          Principal Intellectual Property Agreement and forming the subject

          matter hereof;

 

     2.20 "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 as

          more particularly described in the patents and patent applications

          listed in Appendix TRCT;

 

     2.21 "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 including but not limited to IRMA,

          JetCleaner, Alpur, PDBF, CCF and Autopak which is marketed by Pechiney

          Aluminium Engineering as more particularly described in the patents

          and patent applications listed in Appendix MTT.

 

     2.22 "PRINCIPAL INTELLECTUAL PROPERTY AGREEMENT" shall mean that other

          Intellectual Property Agreement, of even date herewith, between

          Alcanint as the party of the first part and Novelis as the party of

          the second part;

 

     2.23 "SEPARATION AGREEMENT" shall mean the Separation Agreement of even

          date herewith between Alcan and Novelis, as described in the Preamble

          of this Agreement;

 

 

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     2.24 "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 6.5 mm or less;

 

     2.25 "SIERRE TECHNOLOGY shall mean the patents and patent applications

          listed on Appendix SP which are a subset of the Automotive Sheet

          Patents as well as the Technology used from time to time in connection

          with the operation of the business and manufacturing activities at the

          Sierre North Building;

 

     2.26 "SIERRE NORTH BUILDING LEASE" shall mean the lease for the premises

          commonly referred to as the "SIERRE NORTH BUILDING" between an Alcan

          Group Company as lessor and Novelis or one of its Affiliates as lessee

          which lease is further referred to in, annexed to or defined in the

          Separation Agreement.

 

     2.27 "SUBSIDIARY" shall mean, with respect to any corporation, association

          or other business entity, any other 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 such corporation,

          association or entity or one or more of its other Subsidiaries; and

 

     2.28 "TECHNICAL ASSISTANCE" shall mean the services rendered by Novelis, or

          a third party selected by Novelis, to the Licensee, to install, test

          and operate and maintain the Novelis Technology.

 

3.0  LICENSE RIGHTS GRANTED

 

     3.1  Novelis hereby grants to Licensee and Licensee hereby accepts, subject

          to the terms and conditions of this Agreement, the following rights

          and licenses:

 

          3.1.1 a royalty-bearing right and license to use the NetCast

               Technology to build, operate, maintain, repair, reconstruct,

               rebuild and expand present or future facilities of Licensee and

               to use and sell the products produced using the NetCast

               Technology on a world-wide basis,

 

          3.1.2 a royalty-bearing right and license to use the CoCast Technology

               to build, operate, maintain, repair, reconstruct, rebuild and

               expand present or future facilities of Licensee and to use and

               sell the products using the CoCast Technology produced

               world-wide; provided, however, that Licensee shall have no right

               under this license to make or sell products using the CoCast

               Technology other than in respect of products destined for use in

               the Aerospace Industry;

 

          3.1.3 a conditional royalty-bearing right and license to use the

               FlexStreme Technology to build, operate, maintain, repair,

               reconstruct, rebuild and expand present or future facilities of

               Licensee and to use and sell the products produced using the

               FlexStreme Technology on a world-wide basis,

 

          3.1.4 a royalty-free right and license to use the InSitu

               Homogenization Technology to build, operate, maintain, repair,

               reconstruct, rebuild and

 

 

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               expand any present or future facilities of Licensee and to use

               and sell the products produced using InSitu Homogenization

               Technology on a world-wide basis,

 

          3.1.5 a royalty-free right and license to use, commercialize and

               sublicense the PAE Metal Treatment Technology on a world-wide

               basis, including without limitation to build, operate, maintain,

               repair, rebuild and expand any present or future facilities of

               Licensee, to manufacture and sell products using the PAE Metal

               Treatment Technology and to assign, sublicense or otherwise

               convey to any person for any of the foregoing purposes,

 

          3.1.6 a royalty-free right and license to use and commercialize the

               Licensed Novelis Patents to build, operate, maintain, repair,

               reconstruct, rebuild and expand any present or future facilities

               of Licensee and to use and sell the products produced using the

               Licensed Novelis Patents on a world-wide basis,

 

          3.1.7 A royalty-free right and license to use and commercialize the

               Automotive Sheet Patents and related Technology, as referred to

               in paragraph 3.1.2 of the Principal Intellectual Property

               Agreement, to build, operate, maintain, repair, reconstruct,

               rebuild and expand any present or future facilities of Licensee

               and to use and sell the products produced using the Automotive

               Sheet Patents and said related Technology on a world-wide basis

               provided that Licensee's rights and Licenses in respect thereto

               shall not extend to permitting the use and commercialization of

               same for Automotive Sheet applications other than for products

               destined or intended for use in public or mass transportation,

 

          3.1.8 A conditional royalty-free right and license to use and

               commercialize the Sierre Technology to build, operate, maintain,

               repair, reconstruct, rebuild and expand any present or future

               facilities of Licensee and to use and sell the products produced

               using the Sierre Technology on a world-wide basis, and

 

          3.1.9 Rights and/or licenses in the FlexCast Technology and the PAE

               Twin Roll Casting Technology under the terms and conditions in

               Appendix CNC hereto.

 

     3.2  To the extent that (i) Novelis continues the commercial sale of

          equipment for implementing the FlexStreme Technology and (ii) Novelis

          offers such equipment to Licensee for sale on terms and conditions

          (including royalties) at least as favourable to Licensee as the best

          of those offered to any third party during the preceding 12 months

          (such conditions (i) and (ii) being referred to herein as a

          "COMMERCIAL LICENSE"), then Licensee shall operate under the terms of

          such Commercial License rather than the licenses granted in paragraph

          3.1.3 herein until the occurrence of condition (i) or (ii) above. At

          any time thereafter, Licensee shall be entitled to operate under the

          license granted under paragraph 3.1.3, as the case may be, with no

          further action required by either Novelis or Licensee, provided that

          Licensee shall provide reasonably prompt notice to Novelis that

          Licensee is operating under the license set forth in paragraph 3.1.3.

          The licenses

 

 

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          provided for in paragraphs 3.1.3 shall not apply to any equipment

          purchased by Licensee prior to the date of such notice for

          implementing FlexStreme Technology to the extent that equipment has

          been acquired with a valid Commercial License. Such previously

          purchased equipment shall continue to be operated under the terms and

          conditions specified at the time such equipment was acquired by

          Licensee.

 

     3.3  The license granted in paragraph 3.1.8 shall be subject to the

          condition that it shall only take effect upon the termination or

          expiry of the Sierre North Building Lease provided such termination is

          not as the result of a default on the part of Alcan.

 

     3.4  Except as otherwise provided for herein, all licenses granted to

          Licensee under this Agreement shall be personal, indivisible,

          non-exclusive, and non-transferable except as otherwise provided

          herein and shall be subject to all terms and conditions herein set