EXHIBIT 4.3
EXECUTION COPY
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (as amended, supplemented, amended and restated
or otherwise modified from time to time, this "Agreement"), dated December 19,
2002 (the "Closing Date"), is made by STERLING CHEMICALS, INC., a Delaware
corporation, STERLING CHEMICALS ENERGY, INC., a Delaware corporation
(individually referred to as an "Assignor", and collectively referred to as the
"Assignors"), NATIONAL CITY BANK, as collateral agent (the "Collateral Agent")
and NATIONAL CITY BANK, as indenture trustee (the "Trustee") for the benefit of
the holders (the "Holders") of the Senior Secured Notes due 2007 of Sterling
Chemicals, Inc.
W I T N E S S E T H:
WHEREAS, the Assignors and the Trustee, as trustee, have entered into
that certain indenture, dated December 19, 2002 (as amended, amended and
restated, supplemented or otherwise modified from time to time, the
"Indenture"), pursuant to which Sterling Chemicals, Inc. issued $94,275,000 in
the aggregate principal amount of Senior Secured Notes due 2007 (together with
any notes issued pursuant to such indenture in lieu of payment of interest in
cash and any notes issued in replacement thereof or in exchange or substitution
therefor the "Notes").
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and in order to induce the
Trustee, for the benefit of the Holders, to enter into the Indenture, each
Assignor jointly and severally agrees, for the benefit of each Holder, as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Certain Terms. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall have the following meanings (such definitions to be equally applicable to
the singular and plural forms thereof):
"Actionable Default" means any Event of Default under and as defined in
the Indenture.
"Agreement" is defined in the preamble.
"Assignors" is defined in the preamble.
"Certain Permitted Liens" means the Liens described in clauses 4, 5, 6,
13, 14, 18, 19, 20 and 22 of the definition of Permitted Liens.
"Closing Date" is defined in the preamble.
"Collateral" is defined in Section 2.1.
"Collateral Agent" is defined in the preamble.
"Company" means Sterling Chemicals, Inc., and any and all successors
thereto.
"Equipment" has the meaning as defined in Section 9-109 of the U.C.C.
"Holders" is defined in the preamble.
"Indenture" is defined in the recital.
"Intercreditor Agreement" means the Intercreditor Agreement, dated the
date hereof, between the Trustee and The CIT Group/Business Credit, Inc., as
such agreement may be amended, modified or supplemented from time to time.
"Issue Date" is defined in the Indenture.
"Material Contracts" means all contracts for the receipt by such
Assignor of services or supplies, but excluding contracts that give rise to the
payment of money to such Assignor.
"Material Patents" means all of Assignors right, title and interest in
and to all patentable inventions, letters patent, and applications for letters
patent that are necessary or appropriate for the continued operation of the
plants located at the Real Property.
"Material Trade Secrets" means all of Assignor's right, title and
interest in and to all common law and statutory trade secrets and all other
confidential or proprietary or useful information and all know-how obtained by
or used in or contemplated at any time for use in the business of any Assignor
(all of the foregoing being collectively called a "Trade Secret") that are
necessary or appropriate for the continued operation of the plants located at
the Real Property, whether or not such Trade Secret has been reduced to a
writing or other tangible form, including all documents and things embodying,
incorporating or referring in any way to such Trade Secret, all Trade Secret
licenses, and including the right to xxx for and to enjoin and to collect
damages for the actual or threatened misappropriation of any Trade Secret and
for the breach or enforcement of any such Trade Secret license.
"Notes" is defined in the recital.
"Notice of Actionable Default" means a notice by the Trustee delivered
to the Collateral Agent, stating that an Actionable Default has occurred. A
Notice of Actionable Default shall be deemed to have been given when the notice
referred to in the preceding sentence has actually been received by the
Collateral Agent and to have been rescinded when the Collateral Agent has
actually received from the notifying party a notice withdrawing such Notice. A
Notice of Actionable Default shall be deemed to be outstanding at all times
after such Notice has been given until such time, if any, as such Notice has
been rescinded.
"Obligations" means (a) the due and punctual payment of (i) principal
and premium, if any, and interest (including interest accruing during the
pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding) owing
by the Assignors under the Secured Debt Documents, when and as due, whether at
maturity, by acceleration, upon one or more dates set for prepayment,
repurchase, redemption or otherwise, and (ii) all other monetary obligations,
including fees, commissions, costs, expenses and indemnities, whether primary,
secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any bankruptcy,
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insolvency, receivership or other similar proceeding, regardless of whether
allowed or allowable in such proceeding), of the Assignors to the Trustee, or
that are otherwise payable to the Trustee, under the Secured Debt Documents and
(b) the due and punctual performance of all covenants, agreements, obligations
and liabilities of the Assignors under or pursuant to the Secured Debt
Documents.
"Permitted Liens" is defined in the Indenture.
"Real Property" means all real property now owned or hereafter acquired
by any Assignor, including, without limitation, the real property more
particularly described in Exhibit A of that certain Deed of Trust, Assignment of
Leases and Rents, Security Agreement and Fixture Filing, of even date herewith,
among the Company, as Trustor, to National City Bank, as Trustee, for the
benefit of National City Bank, as Collateral Agent, for the benefit of the
Trustee.
"Satisfaction Date" means the date on which all Obligations have been
irrevocably paid in full or otherwise satisfied.
"Secured Debt Documents" means the Security Documents, the Indenture
and the Notes.
"Security Documents" is defined in the Indenture.
"Security Agreement" means each of this Agreement and any other
agreement pursuant to which one or more Assignors grants a security interest to
the Collateral Agent for the benefit of the Trustee.
"Trustee" is defined in the preamble.
SECTION 1.2 Indenture Definitions. Unless otherwise defined
herein or the context otherwise requires, terms used in this Agreement,
including its preamble and recitals, have the meanings provided in the
Indenture.
SECTION 1.3 U.C.C. Definitions. Unless otherwise defined herein
or the context otherwise requires, terms for which meanings are provided in the
Uniform Commercial Code from time to time in effect in the State of New York
(the "U.C.C.") are used in this Agreement, including its preamble and recitals,
with such meanings.
ARTICLE II
SECURITY INTEREST
SECTION 2.1 Grant of Security. Each Assignor hereby assigns,
pledges, hypothecates, charges, delivers and transfers to the Collateral Agent
for its benefit and the ratable benefit of the Holders and hereby grants to the
Collateral Agent for its benefit and the ratable benefit of the Holders a
continuing first priority (subject only to Permitted Liens existing on the Issue
Date and Certain Permitted Liens) security interest in all of the following,
whether now owned or hereafter acquired (collectively, the "Collateral"):
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(a) the Real Property, buildings, structures and other
improvements to any of the foregoing of the Assignors and to the extent
any of the following items of property constitute fixtures and/or
Equipment under applicable laws, all fixtures, fittings, appliances,
apparatus, Equipment, machinery, building and construction materials
and all other articles of every kind and nature whatsoever (other than
Inventory (as defined in the UCC) and other current assets) and all
replacements thereof and additions, enhancements or upgrades thereto,
now or hereafter affixed or attached to, placed upon or located on or
in the Real Property or any buildings, structures and other
improvements located thereon, the Material Patents, the Material Trade
Secrets and the Material Contracts;
(b) all products, offspring, rents, issues, profits,
returns, income and proceeds of and from any and all of the foregoing
Collateral (including proceeds which constitute property of the types
described in clause (a) and, to the extent not otherwise included, all
payments under insurance (whether or not the Collateral Agent is the
loss payee thereof) or any indemnity, warranty or guaranty, payable by
reason of loss or damage to or otherwise with respect to any of the
foregoing Collateral); provided, however, that in no event shall the
Collateral include any products, offsprings, rents, issues, profits,
returns, income or proceeds that constitute Credit Agreement Collateral
under section 2.1(c) of the Intercreditor Agreement.
Notwithstanding the foregoing, "Collateral" shall not include any general
intangibles or other rights arising under any contracts, instruments, licenses
or other documents as to which the grant of a security interest would constitute
a violation of a valid and enforceable restriction in favor of a third party on
such grant, unless and until any required consents shall have been obtained.
Each Assignor agrees to use its best efforts to obtain any such required consent
with respect to any material item of Collateral.
SECTION 2.2 Security for Obligations. This Agreement secures the
payment in full in cash and the performance of all Obligations.
SECTION 2.3 Continuing Security Interest. This Agreement shall
create a continuing first priority (subject only to Permitted Liens existing on
the Issue Date and Certain Permitted Liens) security interest in the Collateral
and shall:
(a) remain in full force and effect until the
satisfaction of all Obligations;
(b) be binding upon each Assignor, its successors,
transferees and assigns; and
(c) inure, together with the rights and remedies of the
Collateral Agent hereunder, to the benefit of the Collateral Agent, the
Trustee and the Holders.
SECTION 2.4 Assignor Remains Liable. Anything herein to the
contrary notwithstanding;
(a) each Assignor will remain liable under the contracts
and agreements included in the Collateral to the extent set forth
therein, and will perform all of its duties and obligations under such
contracts and agreements to the same extent as if this Agreement had
not been executed;
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(b) the exercise by the Collateral Agent of any of its
rights hereunder will not release any Assignor from any of its duties
or obligations under any such contracts or agreements included in the
Collateral; and
(c) neither the Collateral Agent nor any Holder will have
any obligation or liability under any such contracts or agreements
included in the Collateral by reason of this Agreement, nor will the
Collateral Agent or any other Collateral Agent or any Holder be
obligated to perform any of the obligations or duties of any Assignor
thereunder or to take any action to collect or enforce any claim for
payment assigned hereunder.
SECTION 2.5 Security Interest Absolute. All rights of the
Collateral Agent and the security interests granted to the Collateral Agent
hereunder, and all obligations of each Assignor hereunder, shall be absolute and
unconditional, irrespective of:
(a) any lack of validity or enforceability of the
Indenture or this Agreement;
(b) the failure of the Collateral Agent or any Holder
(i) to assert any claim or demand or to enforce
any right or remedy against the Assignors or any other Person
under the provisions of the Indenture or this Agreement or
otherwise or
(ii) to exercise any right or remedy against any
guarantor of, or Collateral securing, any Obligations;
(c) any change in the time, manner or place of payment
of, or in any other term of, all or any of the Obligations or any other
extension, compromise or renewal of any Obligations;
(d) any redaction, limitation, impairment or termination
of any Obligations for any reason (other than the repayment in full and
in cash of all Obligations), including any claim of waiver, release,
surrender, alteration or compromise, and shall not be subject to (and
each Assignor hereby waives any right to or claim of) any defense or
set-off, counterclaim, recoupment or termination whatsoever by reason
of the invalidity, illegality, nongenuineness, irregularity, compromise
or unenforceability of, or any other event or occurrence affecting, any
Obligations or otherwise;
(e) any amendment to, rescission, waiver or other
modification of, or any consent to departure from, any of the terms of
the Indenture or this Agreement;
(f) any addition, exchange, release, surrender or
non-perfection of any collateral (including the Collateral), or any
amendment to or waiver or release of or addition to or consent to
departure from any guaranty for any of the Obligations; or
(g) any other circumstances which might otherwise
constitute a defense available to, or a legal or equitable discharge
of, any Assignor, any surety or any guarantor.
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SECTION 2.6 Postponement of Subrogation, etc. Each Assignor
hereby agrees that it will not exercise any rights which it may acquire by
reason of any payment made hereunder, whether by way of subrogation,
reimbursement or otherwise, until the Satisfaction Date. Any amount paid to any
Assignor hereunder prior to the Satisfaction Date shall be held in trust for the
benefit of the Collateral Agent and the Holders and shall immediately be paid to
the Collateral Agent for the benefit of the Holders and credited and applied
against the Obligations, whether matured or unmatured, in accordance with the
terms of Section 6.1 hereof; provided, however, that if:
(a) such Assignor has made payment to the Collateral
Agent of all or any part of the Obligations: and
(b) the Satisfaction Date has occurred,
the Collateral Agent, on behalf of the Holders agrees that, at the requesting
Assignor's request, the Collateral Agent, on behalf of the Collateral Agent and
the Holders will execute and deliver to such Assignor appropriate documents
(without recourse and without representation or warranty) necessary to evidence
the transfer by subrogation to such Assignor of an interest in the Obligations
resulting from such payment by such Assignor. In furtherance of the foregoing,
prior to the Satisfaction Date, each Assignor shall refrain from taking any
action or commencing any proceeding against any Assignor (or its successors or
assigns, whether in connection with a bankruptcy proceeding or otherwise) to
recover any amounts in respect of payments made under this Agreement to the
Collateral Agent or Holders.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1 Representations and Warranties. Except as disclosed
on Schedule I attached hereto, each Assignor represents and warrants to the
Collateral Agent and the Holders as set forth in this Article III.
SECTION 3.2 Ownership, No Liens, etc. Each Assignor owns its
Collateral free and clear of any Lien, except for the Lien in favor of the
Collateral Agent and Permitted Liens. No effective financing statement or other
instrument similar in effect covering all or any part of the Collateral is on
file in any recording office, except such as may have been filed in favor of the
Collateral Agent relating to this Agreement or as have been filed in connection
with Permitted Liens.
SECTION 3.3 Validity, etc. This Agreement creates a valid
continuing first priority (subject only to Permitted Liens existing on the Issue
Date and Certain Permitted Liens) security interest in the Collateral securing
the payment in full in cash and performance of the Obligations, and the
Assignors will at all times cause the security interests granted pursuant to
this Agreement to constitute valid perfected continuing first priority (subject
only to Permitted Liens existing on the Issue Date and Certain Permitted Liens)
security interest in the Collateral, enforceable as such against all creditors
of the Assignors and (except as otherwise specifically provided herein) any
Persons purporting to purchase any Collateral from the Assignors. Each Assignor
will, promptly upon request by Collateral Agent, execute and deliver or cause to
be executed and
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delivered, or use its best efforts to procure, tax stamps, assignments,
instruments and other documents, all in form and substance reasonably
satisfactory to the Collateral Agent, and take any other actions that are
necessary or, in the reasonable opinion of Collateral Agent, desirable to
perfect, continue the perfection of, or protect the continuing first priority
(subject only to Permitted Liens existing on the Issue Date and Certain
Permitted Liens) security interest of the Collateral Agent in the Collateral, to
protect the Collateral against the rights, claims or interests of third persons,
to enable the Collateral Agent to exercise or enforce its rights and remedies
hereunder, or otherwise to effect the purposes of this Agreement. Each Assignor
also hereby authorizes the Collateral Agent to file any financing or
continuation statements with respect to the Collateral without the signature of
such Assignor to the extent permitted by applicable law. The Assignors will pay
all costs incurred in connection with any of the foregoing.
SECTION 3.4 Authorization, Approval, etc. Except as have been
obtained or made and are in full force and effect, no material authorization,
material approval or other action by, and no material notice to or material
filing with, any Governmental Authority or regulatory body is required either
(a) for the grant by any of the Assignors of the security interest granted
hereby, the pledge by any of the Assignors of any Collateral pursuant hereto or
for the execution, delivery and performance of this Agreement by any of the
Assignors or (b) for the perfection of or the exercise by the Collateral Agent
of its rights and remedies hereunder.
SECTION 3.5 Compliance with Laws. Each Assignor is in compliance
with the requirements of all applicable laws (including the provisions of the
Fair Labor Standards Act), rules, regulations and orders of every Governmental
Authority, the non-compliance with which could reasonably be expected to have a
material adverse effect or which could reasonably be expected to materially
adversely affect the value of the Collateral.
SECTION 3.6 Location of Collateral, etc. All of the Equipment is
located at the address of the Real Property.
SECTION 3.7 Material Patents. None of the Assignors has any
Material Patents.
ARTICLE IV
COVENANTS
SECTION 4.1 Equipment. Each Assignor hereby agrees that it shall:
(a) keep all the Equipment at the places therefor
specified in Section 3.6. or, upon 30 days prior written notice to the
Collateral Agent, at such other places in a jurisdiction where all
representations and warranties set forth in Article III shall be true
and correct in all material respects, and all action required pursuant
to the first sentence of Section 4.2 shall have been taken with respect
to the Equipment;
(b) cause the Equipment to be maintained and preserved in
good repair, ordinary wear and tear excepted, and in all material
respects in accordance with any manufacturer's manual; and forthwith,
or in the case of any loss or damage to any of the Equipment that is
material to the operations of any of the Assignors, as quickly as
practicable after the occurrence thereof, make or cause to be made all
repairs,
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replacements, and other improvements in connection therewith which are
reasonably necessary to such end; and
(c) pay promptly when due all property and other taxes,
assessments and governmental charges or levies imposed upon, and all
claims (including claims for labor, materials and supplies) against the
Equipment, except to the extent the validity thereof is being contested
in good faith by appropriate proceedings.
SECTION 4.2 Further Assurances. etc. Each Assignor agrees that,
from time to time at its own expense, it will promptly execute and deliver all
further instruments and documents and take all further action, that may be
necessary or desirable, or that the Collateral Agent may reasonably request, in
order to perfect, preserve, protect and record any security interest granted or
purported to be granted hereby or to enable the Collateral Agent to exercise and
enforce its rights and remedies hereunder with respect to any Collateral.
Without limiting the generality of the foregoing, each Assignor will:
(a) execute and file such financing or continuation
statements, or amendments thereto, and such other instruments or
notices as may be necessary or desirable, or as the Collateral Agent
may request, in order to perfect and preserve the security interests
and other rights granted or purported to be granted to the Collateral
Agent hereby; and
(b) furnish to the Collateral Agent, from time to time
at the Collateral Agent's request, statements and schedules further
identifying and describing the Collateral and such other reports in
connection with the Collateral as the Collateral Agent may reasonably
request, all in reasonable detail.
SECTION 4.3 Material Patents. Each Assignor agrees that if it
develops or otherwise acquires any Material Patents, such Assignor shall take
such actions and execute and deliver such documents and instruments as may be
required or necessary to grant to the Collateral Agent for its benefit and the
ratable benefit of the Holders a first priority (subject only to Permitted Liens
existing on the date of the grant of such security interests and Certain
Permitted Liens) security interest in such Material Patents, including promptly
executing and delivering to the Collateral Agent a Patent and Security Agreement
substantially in the form of Exhibit A attached hereto.
With respect to the foregoing and the grant of the security interest hereunder,
each Assignor hereby authorizes the Collateral Agent to file one or more
financing or continuation statements, and amendments thereto, relative to all or
any part of the Collateral without the signature of such Assignor where
permitted by law. A carbon, photographic or other reproduction of this Agreement
or any financing statement covering the Collateral or any part thereof shall be
sufficient as a financing statement where permitted by law.
ARTICLE V
THE COLLATERAL AGENT; RECOURSE OF TRUSTEE;
ACTS OF TRUSTEE
SECTION 5.1 Collateral Agent Appointed Attorney-in-Fact. Each
Assignor hereby irrevocably appoints the Collateral Agent as such Assignor's
attorney-in-fact, with full authority
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to act in the name, place and stead of the Assignor or in its own name, from
time to time in the Collateral Agent's discretion, to take, upon the occurrence
and during the continuance of an Actionable Default, any action and to execute
any instrument which the Collateral Agent may deem necessary or advisable to
accomplish the purposes of this Agreement, including without limitation:
(a) to ask, demand, collect, xxx for, recover, compromise
and receive and give acquittance and receipts for moneys due and to
become due under or in respect of any of the Collateral;
(b) to receive, endorse and collect any drafts or other
instruments, documents and chattel paper, in connection with clause (a)
above;
(c) to file any claims or take any action or institute
any proceedings which the Collateral Agent may deem necessary or
desirable to protect and preserve the Collateral or for the collection
of any of the Collateral or otherwise to enforce the rights and
remedies of the Collateral Agent with respect to any of the Collateral
thereunder or otherwise; and
(d) to perform the affirmative obligations of such
Assignor hereunder (including all obligations of such Assignor pursuant
to Section 4.2).
SECTION 5.2 Authority of Collateral Agent. The Collateral Agent
shall have and be entitled to exercise all powers hereunder that are
specifically granted to Collateral Agent by the terms hereof, together with such
powers as are reasonably incidental thereto. The Collateral Agent may perform
any of its duties hereunder or in connection with the Collateral by or through
agents or employees and shall be entitled to retain counsel and to act in
reliance upon the advice of counsel concerning all such matters. Neither the
Collateral Agent nor any director, officer, employee, attorney or agent of the
Collateral Agent shall be responsible for the validity, effectiveness or
sufficiency hereof or of any document or security furnished pursuant hereto. The
Collateral Agent and its directors, officers, employees, attorneys and agents
shall be entitled to rely on any communication, instrument or document
reasonably believed by it or them to be genuine and correct and to have been
signed or sent by the proper person or persons.
Each Assignor acknowledges that the rights and responsibilities of the
Collateral Agent under this Agreement with respect to any action taken by the
Collateral Agent or the exercise or non-exercise by the Collateral Agent of any
option, right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Agreement shall, as between the Collateral
Agent, the Trustee and the Holders, be governed by this Agreement, the Indenture
and by such other agreements with respect thereto as may exist from time to time
among them, but, as between the Collateral Agent and the Assignors, the
Collateral Agent shall be conclusively presumed to be acting as agent for the
Trustee and the Holders with full and valid authority so to act or refrain from
acting, and the Assignors shall not be obligated or entitled to make any inquiry
respecting such authority.
SECTION 5.3 Appointment of Collateral Agent; Resignation or
Removal of the Collateral Agent.
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(a) The Trustee, acting on behalf of the Holders,
pursuant to the Indenture, hereby appoints National City Bank to act as
Collateral Agent pursuant to the terms of this Agreement. The
relationship between the Collateral Agent and the Trustee, on behalf of
the Holders, is and shall be that of agent and principal only, and
nothing contained in this Agreement shall be construed to constitute
the Collateral Agent, as such, as a trustee for the Trustee or any
Holder.
(b) Until such time as the Obligations shall have been
paid in full, the Collateral Agent may at any time, by giving written
notice to the Assignors, the Trustee and the Holders, resign and be
discharged of the responsibilities hereby created, such resignation to
become effective upon (i) the appointment of a successor Collateral
Agent and (ii) the acceptance of such appointment by such successor
Collateral Agent. As promptly as practicable after the giving of any
such notice, the Trustee (if the Trustee is not then acting as the
Collateral Agent hereunder) or if the Trustee and the Collateral Agent
are the same person or entity, the Holders shall appoint a successor
Collateral Agent, which successor Collateral Agent shall be reasonably
acceptable to the Company. If no successor Collateral Agent shall be
appointed and shall have accepted such appointment within 90 days after
the Collateral Agent gives the aforesaid notice of resignation, the
Collateral Agent may apply to any court of competent jurisdiction to
appoint a successor Collateral Agent to act until such time, if any, as
a successor shall have been appointed as provided in this Section 5.3.
Any successor so appointed by such court shall immediately and without
further act be superseded by any successor Collateral Agent appointed
by the Holders, as provided in this Section 5.3. Any Collateral Agent
that has resigned shall be entitled to fees, costs and expenses to the
extent incurred or arising, or relating to events occurring, before its
resignation or removal.
SECTION 5.4 Release; Termination of Agreement. (a) This Agreement
shall terminate upon the earlier to occur of (i) the Satisfaction Date, (ii) the
latest of (x) the day of the Legal Defeasance of all of the Obligations owing to
the Holders pursuant to Section 8.02 of the Indenture (other than those
surviving Obligations owing to the Holders specified therein); and (y) the date
of payment in full of all Obligations, and (iii) the later of (x) such other
termination date as is provided in the Indenture and (y) the date of payment in
full of all Obligations. At such time, the Collateral Agent shall, at the
request of the Assignors, reassign and redeliver to the Assignors all of the
Collateral hereunder that has not been sold, disposed of, retained or applied by
the Collateral Agent in accordance with the terms hereof. Such reassignment and
redelivery shall be without warranty by or recourse to the Collateral Agent,
except as to the absence of any prior assignments by the Collateral Agent of its
interest in the Collateral, and shall be at the expense of the Assignors.
(b) Each of the Assignors agree that they will not,
except as permitted by the Indenture, sell or dispose of, or grant any
option or warrant with respect to, any of the Collateral; provided,
however, that if any Assignor shall sell any of the Collateral in
accordance with the terms of the Indenture, the Collateral Agent shall,
at the request of the Assignors and subject to requirements of Section
10.03 of the Indenture, release the Collateral subject to such sale
free and clear of the Lien under this Agreement.
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(c) Trust Indenture Act Compliance. Notwithstanding the
foregoing provisions of this Section 5.4, the Collateral Agent is not
authorized to release any Collateral or to provide any such release or
termination statement unless the Collateral Agent shall have received a
certificate from the Company certifying that all documentation required
by Section 314(d) of the Trust Indenture Act of 1939, as amended, in
connection with such release has been duly furnished to the Trustee in
accordance with Section 10.04 of each of the Indenture.
SECTION 5.5 Collateral Agent Has No Duty. The powers conferred on
the Collateral Agent hereunder are solely to protect the interest of the Trustee
(on behalf of the Holders) in the Collateral and shall not impose any duty on it
to exercise any such powers. Except for reasonable care of any Collateral in its
possession and the accounting for moneys actually received by it hereunder, the
Collateral Agent shall have no duty as to any Collateral or responsibility for:
(a) ascertaining or taking action with respect to calls,
conversions, exchanges, maturities, tenders or other matters relative
to any investment property, whether or not the Collateral Agent has or
is deemed to have knowledge of such matters; or
(b) taking any necessary steps to preserve rights against
prior parties or any other rights pertaining to any Collateral.
SECTION 5.6 Action Under Agreement. The Collateral Agent shall
not be obligated to take any action under this Agreement except for the
performance of such duties as are specifically set forth herein. The Collateral
Agent shall take any action hereunder which is requested by the Trustee and
which is not inconsistent with or contrary to the provisions of this Agreement
or the Indenture; provided, that the Collateral Agent shall not amend or waive
any provision of this Agreement except in accordance with Section 8.2 hereof. At
any time when a Notice of Actionable Default shall have been given and shall be
outstanding, the Collateral Agent shall exercise or refrain from exercising all
such rights, powers and remedies as shall be available to it hereunder in
accordance with any written instructions received from the Trustee. The
Collateral Agent shall have the right to decline to follow any such direction if
the Collateral Agent, being advised by counsel, determines that the directed
action is not permitted by the terms of this Agreement or the Indenture, may not
lawfully be taken or would involve it in personal liability, and the Collateral
Agent shall not be required to take any such action unless any indemnity which
is required hereunder in respect of such action has been provided. The
Collateral Agent may rely on any such direction given to it by the Trustee and
shall be fully protected, and shall under no circumstances (absent the gross
negligence and willful misconduct of the Collateral Agent) be liable to any of
the Assignors, any of the Holders or any other Person for taking or refraining
from taking action in accordance therewith. Absent written instructions from the
Trustee (a) at a time when a Notice of Actionable Default shall be outstanding
or (b) in the case of an emergency in order to protect any of the Collateral,
the Collateral Agent may take, but shall have no obligation to take, any and all
such actions hereunder or otherwise as it shall deem to be in the best interests
of the Trustee. Except as provided in the preceding sentence, in the absence of
written instructions (which may relate to the exercise of specific remedies or
to the exercise of remedies in general) from the Trustee, the Collateral Agent
shall not exercise remedies available to it hereunder with respect to the
Collateral or any part thereof.
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SECTION 5.7 Reasonable Care. The Collateral Agent is required to
exercise reasonable care in the custody and preservation of any of the
Collateral in its possession; provided, however, that the Collateral Agent shall
be deemed to have exercised reasonable care in the custody and preservation of
any of the Collateral if it takes such action for that purpose as the Trustee or
any Assignor reasonably requests in writing from time to time, but failure of
the Collateral Agent to comply with any such request at any time shall not in
itself be deemed a failure to exercise reasonable care. If an Actionable Default
has occurred and is continuing, the Collateral Agent shall not be required to
comply with any request of the Assignors with respect to the matters described
in this Section 5.7.
SECTION 5.8 Recourse of Trustee; Other Collateral. The Trustee
acknowledges and agrees that (a) it shall only have recourse to the Collateral
through the Collateral Agent and that it shall have no independent recourse to
the Collateral, and (b) the Collateral Agent shall have no obligation to take
any action, or refrain from taking any action, except upon instructions from the
Trustee in accordance with Section 5.9 hereof. Nothing contained herein shall
restrict the rights of the Trustee to pursue remedies, by proceedings in law and
equity, to collect principal of or interest on the Notes or to enforce the
performance of and provisions of the Indenture, to the extent that such remedies
do not relate to the Collateral or interfere with the Collateral Agent's right
to take action hereunder.
SECTION 5.9 Acts of Trustee. Any request, demand, authorization,
direction, notice, consent, waiver or other action permitted or required by this
Agreement to be given or taken by the Trustee may be and, at the request of the
Collateral Agent, shall be embodied in and evidenced by one or more instruments
satisfactory in form to the Collateral Agent and signed by or on behalf of the
Trustee and, except as otherwise expressly provided in any such instrument, any
such action shall become effective when such instrument or instruments shall
have been delivered to the Collateral Agent. The instrument or instruments
evidencing any action (and the action embodied therein and evidenced thereby)
are sometimes referred to herein as an "Act" of the persons signing such
instrument or instruments. The Collateral Agent shall be entitled to rely
absolutely upon an Act of the Trustee if such Act purports to be taken by or on
behalf of the Trustee, and nothing in this Section 5.9 or elsewhere in this
Agreement shall be construed to require the Trustee to demonstrate that it has
been authorized by the Holders to take any action which it purports to be
taking, the Collateral Agent being entitled to rely conclusively, and being
fully protected in so relying, on any Act of the Trustee.
SECTION 5.10 Notices to the Trustee and the Assignors. The
Collateral Agent shall within five (5) business days following receipt thereof
furnish to the Trustee and the Assignors:
(a) a copy of each Notice of Actionable Default received
by the Collateral Agent;
(b) a copy of each certificate received by the Collateral
Agent rescinding a Notice of Actionable Default;
(c) written notice of any release or subordination by the
Collateral Agent of any Collateral; and
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(d) such other notices required by the terms of this
Agreement to be furnished by the Collateral Agent.
ARTICLE VI
REMEDIES
SECTION 6.1 Certain Remedies. If any Actionable Default shall
have occurred and be continuing:
(a) The Collateral Agent may exercise in respect of the
Collateral, in addition to other rights and remedies provided for
herein or otherwise available to it, all the rights and remedies of a
secured party on default under the U.C.C. (whether or not the U.C.C.
applies to the affected Collateral) and also may
(i) require each Assignor to, and each Assignor
hereby agrees that it will, at its expense and upon request of
the Collateral Agent forthwith, assemble all or part of the
Collateral as directed by the Collateral Agent and make it
available to the Collateral Agent at a place to be designated
by the Collateral Agent which is reasonably convenient to both
parties, and
(ii) without notice except as specified below,
sell the Collateral or any part thereof in one or more parcels
at public or private sale, at any of the Collateral Agent's
offices or elsewhere, for cash, on credit or for future
delivery, and upon such other terms as the Collateral Agent
may deem commercially reasonable. Each Assignor agrees that,
to the extent notice of sale shall be required by law, at
least ten days prior notice to such Assignor of the time and
place of any public sale or the time after which any private
sale is to be made shall constitute reasonable notification.
The Collateral Agent shall not be obligated to make any sale
of such Collateral regardless of notice of sale having been
given. The Collateral Agent may adjourn any public or private
sale from time to time by announcement at the time and place
fixed therefor, and such sale may, without further notice, be
made at the time and place to which it was so adjourned.
(b) All cash proceeds received by the Collateral Agent in
respect of any sale of, collection from or other realization upon all
or any part of the Collateral shall be applied by the Collateral Agent
against all or any part of the Obligations as follows:
(i) first, to the payment of any amounts payable
to the Collateral Agent pursuant to Section 6.3 or any other
Security Agreement;
(ii) second, to the equal and ratable payment of
any Obligations owing to the Holders which are owed to the
Trustee or any Holder pursuant to the Indenture, applied
(A) first to fees and expense
reimbursements then due to the Trustee;
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(B) then to interest due to the
Trustee;
(C) then to pay the remaining
outstanding Obligations owing to the Holders;
(iii) third, to be held as additional collateral
security until the Satisfaction Date, after which such
remaining cash proceeds shall be paid over to the applicable
Assignor or to whomsoever may be lawfully entitled to receive
such surplus.
(c) The Collateral Agent may:
(i) transfer all or any part of the Collateral
into the name of the Collateral Agent or its nominee, with or
without disclosing that such Collateral is subject to the lien
and security interest hereunder,
(ii) enforce collection of any of the Collateral
by suit or otherwise, and surrender, release or exchange all
or any part thereof, or compromise or extend or renew for any
period (whether or not longer than the original period) any
obligations of any nature of any party with respect thereto,
(iii) take control of any proceeds of the
Collateral, and
(iv) execute (in the name, place and stead of
such Assignor), assignments and other instruments of
conveyance or transfer with respect to all or any of the
Collateral.
SECTION 6.2 Compliance with Restrictions. Each Assignor agrees
that in any sale of any of the Collateral whenever an Actionable Default shall
have occurred and be continuing, the Collateral Agent is hereby authorized to
comply with any limitation or restriction in connection with such sale as it may
be advised by counsel is necessary in order to avoid any violation of applicable
law or in order to obtain any required approval of the sale or of the purchaser
by any Governmental Authority or official, and such Assignor further agrees that
such compliance shall not result in such sale being considered or deemed not to
have been made in a commercially reasonable manner, nor shall the Collateral
Agent be liable nor accountable to such Assignor for any discount allowed by the
reason of the fact that such Collateral is sold in compliance with any such
limitation or restriction.
SECTION 6.3 Indemnity and Expenses. Each Assignor hereby jointly
and severally indemnifies and holds harmless the Collateral Agent from and
against any and all claims, losses and liabilities arising out of or resulting
from this Agreement (including enforcement of this Agreement), except claims,
losses or liabilities resulting from the Collateral Agent's gross negligence or
willful misconduct and each Assignor will, upon demand, pay to the Collateral
Agent the amount of any and all reasonable expenses, including the reasonable
fees and disbursements of its counsel and of any experts and agents, which the
Collateral Agent may incur, in each case, in connection with:
(a) the administration of this Agreement;
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(b) the custody, preservation, use, or operation of or
the sale of, collection from, or other realization upon, any of the
Collateral;
(c) the exercise or enforcement of any of the rights of
the Collateral Agent hereunder; or
(d) the failure by any Assignor to perform or observe any
of the provisions hereof.
ARTICLE VII
MISCELLANEOUS PROVISIONS
SECTION 7.1 Security Agreement. This Agreement is a Security
Agreement executed pursuant to the Indenture and shall (unless otherwise
expressly indicated herein) be construed, administered and applied in accordance
with the terms and provisions thereof.
SECTION 7.2 Amendments, etc. No amendment to or waiver of any
provision of this Agreement nor consent to any departure by the Trustee or any
Assignor herefrom shall in any event be effective unless the same shall be in
writing and signed by the Collateral Agent, the Trustee and each Assignor and
then such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given.
SECTION 7.3 Protection of Collateral. The Collateral Agent may
from time to time, at its option, perform any act which each Assignor agrees
hereunder to perform and which such Assignor shall fail to perform after being
requested in writing so to perform (it being understood that no such request
need be given after the occurrence and during the continuance of any Actionable
Default) and the Collateral Agent may from time to time take any other action
which the Collateral Agent reasonably deems necessary for the maintenance,
preservation or protection of any of the Collateral or of its security interest
therein.
SECTION 7.4 Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing and addressed,
delivered or transmitted, if to any Assignor, at the address or facsimile number
of the Company provided for in the Indenture, if to the Collateral Agent, at the
following address or facsimile number: (000) 000-0000, and if to the Trustee, at
the address or facsimile number provided for in the Indenture, or to such other
address or facsimile number as shall be designated by such party in a written
notice to each other party complying as to delivery with the terms of this
Section 7.4. Any notice, (a) if mailed and properly addressed with postage
prepaid or if properly addressed and sent by pre-paid courier service, shall be
deemed given when received, or (b) if transmitted by facsimile, shall be deemed
given when transmitted (and telephonic confirmation of receipt thereof has been
received).
SECTION 7.5 Headings. The various headings of this Agreement are
inserted for convenience only, and shall not affect the meaning or
interpretation of this Agreement or any provision hereof.
SECTION 7.6 Severability. Any provision of this Agreement which
is prohibited or unenforceable in any jurisdiction shall, as to such provision
and such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining
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provisions of this Agreement or affecting the validity or enforceability of such
provision in any other jurisdiction.
SECTION 7.7 Counterparts; Effectiveness. This Agreement may be
executed by the parties hereto in several counterparts, each of which shall be
deemed to be an original (whether such counterpart is originally executed or an
electronic copy of an original) and all of which shall constitute together but
one and the same agreement. This Agreement shall become effective as of the date
first above written and be binding upon an Assignor when a counterpart hereof
executed on behalf of such Assignor shall have been received by the Collateral
Agent.
SECTION 7.8 Governing Law. THIS AGREEMENT SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK,
EXCLUDING THE LAW OF CONFLICTS EXCEPT TO THE EXTENT THAT THE VALIDITY OR
PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT
OF ANY PARTICULAR COLLATERAL, ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER
THAN THE STATE OF NEW YORK.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, each Assignor has caused this Agreement to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
STERLING CHEMICALS, INC.
By _________________________________________
Title
STERLING CHEMICALS ENERGY, INC.
By _________________________________________
Title
NATIONAL CITY BANK, as Collateral Agent
and Trustee
By _________________________________________
Title
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EXECUTION COPY
EXHIBIT A TO SECURITY AGREEMENT
FORM OF PATENT SECURITY AGREEMENT
This PATENT SECURITY AGREEMENT (this "Patent Security Agreement"),
dated as of _________, 200[ ], is made by [STERLING CHEMICALS, INC., a Delaware
corporation, and STERLING CHEMICALS ENERGY, INC., a Delaware corporation]
(individually referred to as an "Assignor", and collectively referred to as the
"Assignors"), and NATIONAL CITY BANK, as Collateral Agent.
WITNESSETH:
WHEREAS, Sterling Chemicals, Inc, Sterling Chemicals Energy, Inc. and
the Collateral Agent, as Collateral Agent, have entered into that certain
Security Agreement, dated December 19, 2002 (as amended, amended and restated,
supplemented or otherwise modified from time to time, the "Agreement"), the
terms of which require that the Assignor (i) pledge to the Collateral Agent for
the benefit of the Holders (as defined in the Agreement), and grant to the
Collateral Agent for the ratable benefit of the Holders a continuing first
priority security interest in the Collateral (as defined herein) and (ii)
execute and deliver this Patent Security Agreement in order to secure the
payment in full in cash and performance by the Assignor of all of its
Obligations (as defined in the Agreement);
WHEREAS, pursuant to Section 4.3 of the Agreement, each Assignor agreed
to grant a security interest in any Material Patents it may develop or otherwise
acquire;
NOW, THEREFORE, in consideration of the premises, the Assignor hereby
agrees with the Collateral Agent for its benefit and the benefit of the Holders
as follows:
SECTION l. Definitions. Unless otherwise defined herein or the
context otherwise requires, terms used in this Patent Security Agreement,
including its preamble and recitals, have the meanings provided (or incorporated
by reference) in the Agreement.
SECTION 2. Grant of Security Interest. For good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, to
secure the payment in full in cash and the performance of all of the
Obligations, each Assignor does hereby pledge and hypothecate to the Collateral
Agent, and grant to the Collateral Agent a continuing first priority security
interest in, in each case subject only to Permitted Liens existing on the date
hereof and Certain Permitted Liens, for its benefit and the benefit of each
Holder, all of Assignors right, title and interest in and to the following
Material Patents (as that term is defined in the Agreement) (the "Patent
Collateral"), whether now owned or hereafter acquired or existing by it:
(a) all patentable inventions and all letters patent and
applications for letters patent listed in Item A of Schedule I attached
hereto and all inventions and improvements described and claimed
therein;
(b) all reissues, divisions, continuations,
continuations-in-part, extensions, renewals and reexaminations of any
of the items described in clause (a);
(c) all patent licenses referred to in Item B of
Schedule I attached hereto whether Assignor is a licensor or licensee;
and
(d) all proceeds of, and rights associated with, the
foregoing (including license royalties and proceeds of infringement
suits), the right to xxx third parties for past, present or future
infringements or misappropriations of any invention, patent or patent
application, referred to in clauses (a) or (b) above, and for breach or
enforcement of any patent license referred to in clause (c) above.
SECTION 3. Representations and Warranties. Except as disclosed
on Schedule I attached hereto, each Assignor represents and warrants as to
itself and its Patent Collateral as follows:
(a) Such Assignor has made all necessary filings and
recordations to protect, maintain and record its interest in the
patents and patent applications set forth in Schedule I, including,
without limitation, all necessary filings and recordations in the
United States Patent and Trademark Office.
(b) Each patent and patent application set forth in
Schedule I that is owned by such Assignor is subsisting and has not
been adjudged invalid, unpatentable or unenforceable, in whole or in
part, and, to such Assignor's knowledge, each such patent is valid,
subsisting and enforceable and each such patent application is believed
to be patentable. Each license identified in Schedule I is validly
subsisting and has not been adjudged invalid or unenforceable, in whole
or in part, and, to such Assignor's knowledge, is valid and
enforceable. Such Assignor has notified the Collateral Agent in writing
of all facts concerning any item of Patent Collateral of which such
Assignor is aware which could reasonably be expected to lead to such
item becoming invalid or unenforceable.
(c) Such Assignor has not made a previous assignment,
sale, transfer or agreement constituting a present or future
assignment, sale, transfer or encumbrance of any of the Patent
Collateral that has not been terminated or released. Such Assignor has
not granted any license (other than those listed on Schedule I hereto),
shop right, release, covenant not to xxx, or non-assertion assurance to
any person with respect to any part of the Patent Collateral.
(d) Except for the licenses listed on Schedule I hereto,
such Assignor has no knowledge of the existence of any right or any
claim that is likely to be made under any item of Patent Collateral
contained on Schedule I.
(e) No claim has been made and is continuing against such
Assignor or, to such Assignor's knowledge, threatened that any Patent
Collateral is invalid or unenforceable or that the use by such Assignor
of any product or process claimed in any Patent Collateral owned by
such Assignor does or may violate the rights of any person. To such
Assignor's knowledge, there is currently no infringement or
unauthorized use of any Patent Collateral contained on Schedule I.
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(f) Such Assignor has no knowledge of the existence of
any patent or license agreement held or claimed by any other person
that would preclude such Assignor from distributing, marketing, selling
or providing any product sold or provided by it, as the case may be,
under or in connection with any of the Patent Collateral (except, in
each case, to the extent that such Assignor has granted an exclusive
license to another person), or that would interfere with the ability of
such Assignor to carry on its business as currently carried on, and
such Assignor has no knowledge of any claim that is likely to be made
that if upheld would preclude or interfere with the business of such
Assignor as currently carried on under any of the Patent Collateral.
SECTION 4. Further Assurances.
(a) In accordance with Section 4.3 of the Agreement, each
Assignor agrees that, should it obtain an ownership interest in any
patent, patent application or patent license which is not now a part of
the Patent Collateral, (i) the provisions of Section 2 hereof shall
automatically apply thereto, (ii) any such patent, patent application
or patent license shall automatically become part of the Patent
Collateral, and (iii) with respect to any ownership interest in any
patent, patent application or patent license that such Assignor should
obtain, it shall give prompt written notice thereof to the Collateral
Agent. Each Assignor authorizes the Collateral Agent to modify this
Agreement by amending Schedule I (and will cooperate reasonably with
the Collateral Agent in effecting any such amendment) to include any
patent, patent application or patent license which becomes part of the
Patent Collateral under this Section 4(a).
(b) With respect to each patent, patent application and
license included in the Patent Collateral, each Assignor agrees,
subject to the last sentence of this subsection (b), to take all
commercially reasonable steps, including, without limitation, in the
United States Patent and Trademark Office or in any court, to (i)
maintain each such patent, patent application and license, and (ii)
prosecute each such patent application, now or hereafter included in
the Patent Collateral, including, without limitation, the filing of
divisional, continuation, and continuation-in-part applications, the
filing of applications for reissue, renewal or extensions, the payment
of maintenance fees, and the participation in interference,
reexamination, opposition, infringement and misappropriation
proceedings. Each Assignor agrees to take corresponding steps with
respect to each new or acquired patent, patent application or license
which it is now or later becomes entitled for which such Assignor has
determined in its reasonable business judgment to be desirable in
connection with its operations. Any expenses incurred in connection
with such activities shall be borne by such Assignor. Such Assignor
shall not knowingly abandon any right to file any patent application,
or abandon any patent pending application or patent included in the
Patent Collateral, without the written consent of the Collateral Agent,
unless such Assignor shall have determined in its reasonable business
judgment that it is no longer desirable to maintain such right,
application or patent in connection with the conduct of such Assignor's
business and that the loss thereof will not have a material adverse
impact on such Assignor's business, in which case, such Assignor will
give written notice of any such abandonment to the Collateral Agent
within 90 days after such abandonment.
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(c) Each Assignor agrees to notify the Collateral Agent
promptly and in writing if it learns (i) that any item of the Patent
Collateral contained on Schedule I may be determined to have become
abandoned or (ii) of any adverse determination or the institution of
any proceeding (including, without limitation, the institution of any
proceeding in the United States Patent and Trademark Office or any
court) regarding any item of the Patent Collateral, unless such
Assignor shall have determined in its reasonable business judgment that
such abandonment or determination will not have a material adverse
impact on such Assignor's business.
(d) In the event that any Assignor becomes aware that any
item of the Patent Collateral is infringed or misappropriated by a
third party, such Assignor shall promptly notify the Collateral Agent
and shall take such actions as such Assignor deems appropriate under
the circumstances to protect such Patent Collateral, including, without
limitation, suing for infringement or misappropriation and for an
injunction against such infringement or misappropriation. Any expense
incurred in connection with such activities shall be borne by such
Assignor.
(e) Each Assignor shall to the extent it deems reasonable
in its business judgment xxxx its products with the numbers of the
appropriate Patents contained in Schedule I or the designation "patent
pending," as the case may be.
SECTION 5. Security Agreement. This Patent Security Agreement
has been executed and delivered by the Assignor for the purpose of recording the
security interest of the Collateral Agent in the Patent Collateral with the
United States Patent and Trademark Office. The security interest granted hereby
has been granted as a supplement to, and not in limitation of, the security
interest granted to the Collateral Agent for its benefit and the benefit of each
Holder. The Agreement (and all rights and remedies of the Collateral Agent and
each Holder thereunder) shall remain in full force and effect in accordance with
its terms.
SECTION 6. Release of Security Interest. Upon the earliest to
occur of (i) the sale, transfer or other disposition of any Patent Collateral in
accordance with the terms of the Indenture, (ii) the later of (x) the day of the
Legal Defeasance of all Obligations owing to the Holders pursuant to Section
8.02 of the Indenture (other than those surviving Obligations owing to the
Holders specified therein) and (y) the date of payment in full of all
Obligations, (iii) the Satisfaction Date and (iv) the later of (x) such other
termination date as is provided in the Indenture and (y) the date of payment in
full of all Obligations, the Collateral Agent shall, subject to the requirements
of Section 10.03 of the Indenture, upon the request of an Assignor and at such
Assignor's expense, execute and deliver to such Assignor all instruments and
other documents as may be necessary or proper to release the Lien on the Patent
Collateral which has been granted hereunder.
SECTION 7. Acknowledgment. Each Assignor does hereby further
acknowledge and affirm that the rights and remedies of the Collateral Agent with
respect to the Lien on the Patent Collateral granted hereby are more fully set
forth in the Agreement, the terms and provisions of which (including the
remedies provided for therein) are incorporated by reference herein as if fully
set forth herein.
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SECTION 8. The Indenture or any other Security Agreement, etc.
This Patent Security Agreement is a Security Agreement executed pursuant to the
Indenture and shall (unless otherwise expressly indicated herein) be construed,
administered and applied in accordance with the terms and provisions of the
Indenture.
SECTION 9. Counterparts. This Patent Security Agreement may be
executed by the parties hereto in several counterparts, each of which shall be
deemed to be an original (whether such counterpart is originally executed or an
electronic copy of an original) and all of which shall constitute together but
one and the same agreement. This Patent Security Agreement shall become
effective and binding as of the date first above written when a counterpart
hereof executed on behalf of such Assignor shall have been received by the
Collateral Agent.
IN WITNESS WHEREOF, the parties hereto have caused this Patent Security
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the day and year first above written.
ASSIGNOR:
[STERLING CHEMICALS, INC.]
By: ________________________________________
Title: _____________________________________
[STERLING CHEMICALS ENERGY, INC.]
By: ________________________________________
Title: _____________________________________
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SCHEDULE I
TO SECURITY AGREEMENT
([NAME OF ASSIGNOR])
Item A. Patents
Issued Patents
Patent No. Issue Date Inventor(s) Title
Pending Patent Applications
Serial No. Filing Date Inventor(s) Title
Item B. Patent Licenses
Effective Expiration Subject
Licensor Licensee Date Date Matter
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