SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
September 4, 1997
---------------------------------
(Date of earliest event reported)
Huntsman Polymers Corporation
------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Delaware 1-9988 75-2104131
-------------- --------------------- -------------------
(State of (Commission File No.) (IRS Employer
Incorporation) Identification No.)
500 Huntsman Way, Salt Lake City, Utah 84108
------------------------------------------------------------
(Address of principal executive offices, including zip code)
(801) 584-5700
----------------------------------------------------
(Registrant's telephone number, including area code)
-------------------------------------------------------------
(Former name or former address, if changed since last report)
ITEM 5. OTHER EVENTS.
In May 1990, Phillips Petroleum Company ("Phillips")
filed a lawsuit (the "Action") against Rexene Corporation
(which subsequently changed its name to Huntsman Polymers
Corporation) (the "Company") in the United States
District Court for the District of Delaware (the "Trial
Court") seeking injunctive relief, an unspecified amount
of compensatory damages, treble damages and attorneys'
fees, costs and expenses.
The complaint alleged that the Company was
infringing Phillips' U.S. Patent No. 4,376,851 (the "'851
Patent") by virtue of its continued manufacture of
crystalline polypropylene after Phillips purportedly
terminated its license agreement (the "Original License
Agreement") with the Company on April 23, 1990. At trial
in October 1994, the Company asserted several defenses
and, in June 1995, the Trial Court ruled in favor of the
Company and Phillips appealed. In March 1996, the Court
of Appeals for the Federal Circuit Court entered an order
reversing the Trial Court's decision and remanding the
Action to the Trial Court. The Trial Court reviewed and
ruled on the Company's other defenses and on September 4,
1997, the Trial Court entered a judgment in favor of
Phillips finding that the Company had infringed the '851
Patent for the period from April 24, 1990 to September 4,
1997.
On September 19, 1997, the Company and Phillips
entered into a settlement agreement (the "Settlement
Agreement"), pursuant to which the Company paid a lump
sum of $10 million to Phillips on September 26, 1997,
and will pay up to $300,000 for each subsequent calendar
quarter period. Such quarterly payments begin with the
quarter ending December 31, 1997, and must be paid
through the partial quarter ending March 15, 2000, when
the '851 Patent expires. Pursuant to the Settlement
Agreement, the Company and Phillips released and
discharged each other from all claims, debts, demands,
liabilities, losses, causes of action, damages, costs and
expenses relating to the subject matter of the Action.
In the event the Company fails to make a timely payment
to Phillips when such payment is due pursuant to the
Settlement Agreement, the Company will be obligated to
pay Phillips accrued interest on such payment.
Effective September 5, 1997, Phillips and the
Company entered into a new crystalline polypropylene
license agreement (the "New License Agreement"). Pursuant
to the New License Agreement, Phillips granted to the
Company a nonexclusive, royalty-bearing license to
manufacture, use and/or sell any product which is covered
by the '851 Patent. The term of the New License Agreement
is for the period from September 5, 1997, until the
expiration of the '851 Patent on March 15, 2000, unless
otherwise terminated under the provisions thereof. The
royalty rate under the New License Agreement is
substantially higher than the royalty rate under the
Original License Agreement. In the event the Company
fails to make a timely payment to Phillips when such
payment is due pursuant to the New License Agreement, the
Company will be required to pay Phillips accrued interest
on such payment.
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned
hereunto duly authorized.
Huntsman Polymers Corporation
Date: September 29, 1997 By: /s/ Martin F. Petersen
-------------------------
Name: Martin F. Petersen
Title: Vice President
