Sterling Chemicals Announces Long-Term Styrene Supply Agreement

Sterling Chemicals, Inc. has announced that on September 17, 2007, it entered into a long-term exclusive styrene supply agreement and a rail car purchase and sale agreement with NOVA Chemicals Inc. ("Nova").

The effectiveness of these agreements is conditioned on the approval of the supply agreement by the Federal Trade Commission (the "FTC"). If the supply agreement becomes effective, it will have an initial term extending until December 31, 2017, subject to some limited earlier termination rights held by Sterling.

Under these agreements, Nova will have the exclusive right to the entire production capacity of Sterling's Texas City, Texas styrene plant, the amount of any styrene supplied being at Nova's option based on a full-cost formula, and will purchase Sterling's styrene monomer rail car fleet. In exchange, Nova has agreed to pay Sterling $60 million within ten business days after the agreements become effective. Alternatively, if the FTC does not approve the supply agreement, Nova will be required to pay Sterling a break-up fee of $6 million.

Sterling Chemicals, Inc. is a leading North American producer of selected petrochemicals used to manufacture a wide array of consumer goods and industrial products throughout the world. Its primary products are acetic acid, styrene and plasticizers.

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