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                                                                    EXHIBIT 10.5

                        STERLING CHEMICALS HOLDINGS, INC.
                            STERLING CHEMICALS, INC.

                  AMENDED AND RESTATED SUPPLEMENTAL BONUS PLAN

                             PRELIMINARY STATEMENTS

       A.     Sterling Chemicals Holdings, Inc. and Sterling Chemicals, Inc. are
              Delaware corporations.

       B.     On July 13, 2001, the Holdings Board and the Chemicals Board (as
              such terms are defined below) approved that certain Success Bonus
              Plan (the "Original Plan") for the benefit of certain employees of
              the Company (as defined below), to become effective on the date on
              which the United States Bankruptcy Court for the Southern District
              of Texas issued an order approving such plan.

       C.     On October 31, 2001, the United States Bankruptcy Court for the
              Southern District of Texas entered an order (the "Court Order")
              approving the Original Plan, subject to certain modifications
              negotiated and agreed to by the Company (as defined below), the
              Official Committee of Unsecured Creditors, The Bank of New York,
              as Indenture Trustee, and the Ad Hoc Committee of holders of
              Chemicals' 12-3/8% Senior Secured Notes due 2006.

       D.     The Holdings Board and the Chemicals Board desire to formally
              amend the Original Plan to incorporate the modifications required
              by the Court Order and to restate the Original Plan as so amended
              in its entirety.

              NOW, THEREFORE, the Original Plan is hereby amended and restated,
effective as of the Effective Date (as defined below), to read in its entirety
as follows:

              Section 1. Definitions and Interpretation. (a) Capitalized terms
used in this Plan shall have the following respective meanings, except as
otherwise provided or as the context shall otherwise require:

              "Benefit Plan" means any employee benefit plan (including any
       employee benefit plan within the meaning of Section 3(3) of the Employee
       Retirement Income Security Act of 1974), program, arrangement or practice
       maintained, sponsored or provided by Holdings or any Subsidiary,
       including those relating to bonuses, incentive compensation, retirement
       benefits, stock options, stock ownership or stock awards, healthcare and
       medical benefits, disability benefits, death benefits, disability, life,
       accident and travel insurance, sick leave, vacation pay or termination
       pay.

              "Chemicals" means Sterling Chemicals, Inc. and any successor to
       all or substantially all of its business, operations or assets.


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              "Chemicals Board" means the Board of Directors of Chemicals.

              "Code" means the Internal Revenue Code of 1986, as amended.
       Reference in this Plan to any section of the Code shall be deemed to
       include any amendments or successor provisions to such section and any
       regulations under such section.

              "Company" means Holdings and the Subsidiaries, including
Chemicals.

              "Confirmation Date" means the date on which the United States
       Bankruptcy Court for the Southern District of Texas issues an order
       confirming a plan of reorganization for the Company.

              "Disability" means, with respect to any Participant, a physical or
       mental condition of such Participant that, in the opinion of a licensed
       physician reasonably acceptable to Holdings and such Participant or his
       or her legal representative, (i) prevents such Participant from being
       able to perform the services required of him or her as an employee of the
       Company, (ii) has continued for at least 180 days during any period of 12
       consecutive months and (c) is reasonably expected to continue.

              "Discretionary Bonus Pool" means an aggregate amount equal to
       $1,400,000 that shall be available for awards under this Plan pursuant to
       Section 2(b).

              "Effective Date" means October 31, 2001.

              "Good Reason" means, with respect to any Participant, any of the
       following actions or failures to act, but in each case only if it occurs
       on or after the Effective Date and while such Participant is employed by
       Holdings or any Subsidiary, and then only if it is not consented to by
       such Participant in writing:

              (i)   a material change in such Participant's reporting
                    responsibilities, titles or elected or appointed offices,
                    including any change caused by the removal of such
                    Participant from, or the failure to re-elect such
                    Participant to, any material corporate office of the Company
                    held by such Participant, but excluding any such change that
                    occurs in connection with such Participant's death,
                    Disability or retirement;

             (ii)   the assignment to such Participant of duties or
                    responsibilities that are materially inconsistent with such
                    Participant's status, positions, duties, responsibilities
                    and functions with the Company;

            (iii)   a reduction by the Company in such Participant's annual
                    base salary or target bonus percentage;

             (iv)   the failure of the Company to continue such Participant's
                    eligibility for participation in Benefit Plans providing
                    benefits that, in the aggregate, are at


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                    least as favorable to such Participant as those provided
                    under the Benefit Plans in which he or she was a
                    participant on the Effective Date;

              (v)   the failure of the Company to maintain Benefit Plans
                    entitling such Participant to benefits that, in the
                    aggregate, are at least as favorable to such Participant as
                    those available to such Participant on the Effective Date;
                    or

             (vi)   any change of more than 75 miles (or, in the case of any
                    Participant for whom the Holdings Board has approved a
                    shorter distance, such shorter distance) in the location of
                    the principal place of employment of such Participant on the
                    Effective Date;

       provided, however, that (A) none of the actions described in clauses (i)
       through (iii) above shall constitute a Good Reason with respect to any
       Participant if it was an isolated and inadvertent action not taken in bad
       faith by the Company and if it is remedied by the Company promptly after
       receipt of notice thereof given by such Participant, and (B) any action
       or failure to act described in clauses (i) through (vi) above shall cease
       to be a Good Reason with respect to any Participant on the date which is
       60 days after such Participant acquires actual knowledge of such action
       or failure to act unless, prior to such date, such Participant gives a
       Termination Notice. In the event of any dispute between the Company, on
       the one hand, and any Participant, on the other hand, with respect to the
       amount of total compensation of such Participant for purposes of clause
       (iii) above or the aggregate value or level of any of such Participant's
       benefits for purposes of clause (iv) or (v) above, the Company and such
       Participant shall use their best efforts to resolve such dispute
       themselves. If they are unable to resolve the dispute within 15 business
       days, Deloitte & Touche L.L.P., or such other nationally recognized
       accounting firm or employee benefits firm acceptable to the Company and
       such Participant, shall be engaged by the Company to make its own
       determination with respect to the dispute and the determination by such
       firm shall be final and binding on the Company and such Participant. If
       any firm is engaged with respect to any dispute as aforesaid, (x) such
       firm shall be instructed to make its determination as soon as practicable
       and to use such materiality standard as such firm may determine to be
       reasonable under the circumstances and (y) the disputants shall provide
       such firm with all books, records and other information relevant to such
       dispute as such firm may reasonably request. No firm engaged as aforesaid
       shall be liable or responsible to the Company or any Participant for any
       determination made by such firm in good faith.

              "Holdings" means Sterling Chemicals Holdings, Inc. and any
       successor to all or substantially all of its business, operations or
       assets.

              "Holdings Board" means the Board of Directors of Holdings.
`
              "Liquidation Date" means the date on which all or substantially
       all of the assets owned by Holdings or Chemicals as of the Effective Date
       are sold or otherwise transferred in a transaction or series of
       transaction (excluding any such transactions that are consummated
       pursuant to a confirmed plan of reorganization), irrespective of whether
       any


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       of such transactions are accomplished pursuant to Chapter 7 or Chapter 11
       of the United States Bankruptcy Code or otherwise.

              "Misconduct" means, with respect to any Participant:

              (i)   the commission by such Participant of acts that are both
                    dishonest and demonstrably injurious to the Company
                    (monetarily or otherwise) in any material respect;

             (ii)   the failure of such Participant to observe and comply with
                    the Company's published policies relating to alcohol and
                    drugs, harassment or antitrust;

            (iii)   the failure of such Participant to observe and comply with
                    any other lawful published policy of the Company, but, in
                    the case of any such failure that is capable of being
                    remedied, only if such failure shall have continued
                    unremedied for more than 30 days after written notice
                    thereof is given to such Participant by Holdings or
                    Chemicals;

             (iv)   the willful failure of such Participant to observe and
                    comply with all lawful and ethical directions and
                    instructions of the Holdings Board, the Chairman of the
                    Board or the President of Holdings or Chemicals;

              (v)   the failure of such Participant to perform, in any material
                    respect, his or her duties with the Company, but only if
                    such failure was not caused by disability or incapacity and
                    shall have continued unremedied for more than 30 days after
                    written notice thereof is given to such Participant by
                    Holdings or Chemicals;

             (vi)   the conviction of such Participant for a felony offense; or

            (vii)   any willful conduct on the part of such Participant that
                    prejudices, in any material respect, the reputation of the
                    Company in the fields of business in which it is engaged or
                    with the investment community or the public at large, but
                    only if such Participant knew, or should have known, that
                    such conduct could have such result.

       For purposes of clauses (iv) and (vii) above, no act or failure to act on
       the part of any Participant shall be considered "willful" if such act or
       failure to act was done or omitted to be done by such Participant in good
       faith and with the reasonable belief that such Participant's action or
       omission was in the best interest of the Company. If any Participant is a
       party to a written employment agreement with the Company, then clause
       (iv) above shall not apply to any directions or instructions that are
       contrary to or inconsistent with any of the positions, functions, duties
       or reporting responsibilities of such Participant as set forth in such
       written employment agreement or that violate any of such Participant's
       rights, privileges or immunities under such employment agreement. In case
       of any dispute regarding whether or not any conduct by a Participant
       meets any of the standards set forth in clauses (i) through (vii) above,
       the burden of proof shall rest with the Company.


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              "Original Plan" has the meaning specified in the Preliminary
       Statements of this Plan.

              "Participants" means such employees of the Company who are from
       time to time designated by the Holdings Board as Participants pursuant to
       Section 2(b).

              "Plan" means this Amended and Restated Supplemental Bonus Plan, as
       amended, supplemented or modified from time to time in accordance with
       its terms.

              "Retention Bonus Plan" means the Company's Amended and Restated
       Retention Bonus Plan, as amended, supplemented or modified from time to
       time in accordance with its terms.

              "Subsidiary" mean any corporation, limited partnership, general
       partnership, limited liability company or other form of entity a majority
       of any class of voting stock or other voting rights of which is owned,
       directly or indirectly, by Holdings.

              (b) Interpretation. In this Plan, unless a clear contrary
intention appears, (i) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Plan as a whole and not to any particular
Section or other subdivision, (ii) reference to any Section, means such Section
hereof and (iii) the words "including" (and with correlative meaning "include")
means including, without limiting the generality of any description preceding
such term. The Section headings herein are for convenience only and shall not
affect the construction hereof.

              Section 2. Eligible Employees. (a) This Plan is only for the
benefit of Participants, and no other employees or personnel shall be eligible
to participate in this Plan or to receive any rights or benefits hereunder.

              (b) The Holdings Board may at any time and from time to time after
the Effective Date designate one or more employees of the Company as
Participants in this Plan for purposes of receiving awards from the
Discretionary Bonus Pool; provided, however, that no "Participant" under the
Retention Bonus Plan (excluding any "Successor," as defined in the Retention
Bonus Plan, who is not entitled to receive any payments thereunder) shall (i) be
designated as a Participant in this Plan or (ii) receive any award from the
Discretionary Bonus Pool. Upon designating any individual as a Participant
pursuant to this paragraph (b), the Holdings Board shall provide such
Participant with written notice of such designation, which notice shall indicate
the amount of such award or the basis on which the amount of such award will be
determined. Upon receipt of such notice by such Participant, the designation of
such employee as a Participant in this Plan and the amount of such award (or
basis on which the amount of such award shall be determined) shall be binding on
the Company and be irrevocable. Except as otherwise provided below in this
paragraph (b), any and all awards payable from the Discretionary Bonus Pool
shall be payable on the earlier of the Confirmation Date or the Liquidation Date
or, in the case of any Participant who is designated after such time, as soon as
practicable after the date of such designation. Notwithstanding anything to the
contrary contained in this Plan, no person designated as a Participant under
this Plan shall be or become


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entitled to receive any payment under this Plan if such Participant's employment
with the Company terminates prior to the relevant payment date for any reason
other than (i) a termination by such Participant for Good Reason or (ii) a
termination by the Company for any reason other than Misconduct or Disability.
Nothing contained in this Plan shall obligate the Holdings Board to designate
any employee of the Company as a Participant hereunder or to award any
Participant any particular amount, irrespective of the status, title or duties
of any other Participant or the amount of award given to any other Participant.
In no event may the awards under this Plan exceed, in the aggregate, the amount
of the Discretionary Bonus Pool.

              Section 3. Dispute Resolution. (a) Except as otherwise provided in
paragraph (c) below, in the event that any dispute or controversy shall arise
between any Participant (or any person claiming by, through or under any
Participant) and the Company relating to or arising out of this Plan, either
disputant may give written notice to the other disputant ("Dispute Notice") that
it wishes to resolve such dispute or controversy by negotiations, in which event
the disputants shall attempt in good faith to negotiate a resolution of such
dispute or controversy. If such dispute or controversy is not resolved within 30
days after receipt of such Dispute Notice by the other disputant, either
disputant may (except as otherwise provided in paragraph (c) below) initiate
arbitration of the matter as provided in paragraph (b) below. All negotiations
pursuant to this paragraph (a) shall be held at the Company's principal offices
in Houston, Texas (or such other place as the disputants shall mutually agree)
and shall be treated as compromise and settlement negotiations for the purposes
of the federal and state rules of evidence and procedure.

              (b) Except as otherwise provided in paragraph (c) below, any
dispute or controversy arising out of or relating to this Plan which has not
been resolved by negotiations in accordance with paragraph (a) above within 30
days of receipt of the relevant Dispute Notice by the other disputant, shall,
upon the written request of either disputant, be finally settled by arbitration
conducted expeditiously in accordance with the labor arbitration rules of the
American Arbitration Association. The arbitrator shall be not empowered to award
damages in excess of compensatory damages and each disputant shall be deemed to
have irrevocably waived any damages in excess of compensatory damages. The
arbitrator's decision shall be final and legally binding on the disputants and
their successors and assigns. The fees and expenses of the arbitrator shall be
borne solely by the prevailing disputant or, in the event there is no clear
prevailing disputant, as the arbitrator deems appropriate. All arbitration
conferences and hearings shall be held in Houston, Texas.

              (c) The dispute resolution procedures set forth in paragraphs (a)
and (b) above shall not apply to any matter which, by the express provisions of
this Plan, is to be finally determined by the Holdings Board. No legal action
may be brought with respect to this Plan except for the purpose of specifically
enforcing the provisions of this Section 3 or for the purpose of enforcing any
arbitration award made pursuant to paragraph (b) above.

              Section 4. Cumulative Benefits. The rights and benefits provided
to any Participant under this Plan are cumulative of, and are in addition to,
all of the other rights and benefits provided to such Participant under any
Benefit Plan or any agreement between such Participant and the Company.


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              Section 5. Amendment and Termination. The Holdings Board and the
Chemicals Board may amend this Plan at any time and for any reason; provided,
however, that no such amendment shall be or become effective with respect to, or
binding upon, any person who at the time of such amendment is a Participant
hereunder if such amendment adversely affects the rights or benefits of, or the
obligations of the Company hereunder to, such Participant unless such
Participant consents otherwise in writing. Notwithstanding any termination or
amendment of this Plan, the benefits payable hereunder to each Participant shall
be paid in full. In case of any dispute regarding whether or not any purported
amendment or termination of this Plan is permitted by, or satisfies any of the
requirements of, this Section 5, the burden of proof shall rest with the
Company.

              Section 6. Enforceability. The provisions of this Plan (a) are for
the benefit of, and may be enforced directly by, each Participant the same as if
the provisions of this Plan were set forth in their entirety in a written
instrument executed and delivered by the Company and such Participant and (b)
constitute a continuing offer to all present and future Participants. Holdings
and Chemicals, by their adoption of this Plan, (i) acknowledge and agree that
each present and future Participant has relied upon and will continue to rely
upon the provisions of this Plan in becoming, and serving as, an employee of the
Company, (ii) waive reliance upon, and all notices of acceptance of, this Plan
by the Participants and (iii) acknowledge and agree that no present or future
Participant shall be prejudiced in his or her right to enforce directly the
provisions of this Plan in accordance with the terms by any act or failure to
act on the part of the Company.

              Section 7. Administration. (a) The Holdings Board shall have full
and final authority to make determinations with respect to the administration of
this Plan, to construe and interpret its provisions and to take all other
actions deemed necessary or advisable for the proper administration of this
Plan, but such authority shall be subject to the provisions of this Plan;
provided, however, that (i) the Holdings Board shall have no authority to change
or modify the level of benefits provided for Participants under this Plan and
(ii) no discretionary action by the Holdings Board shall amend or supersede the
express provisions of this Plan.

              (b) The members of the Holdings Board shall receive no additional
compensation for their services relating to this Plan. Any expenses properly
incurred by the Holdings Board incident to this Plan, including the cost of any
bond required by applicable law, shall be paid by the Company.

              (c) The Company shall indemnify and hold harmless each member of
the Holdings Board against any and all expenses and liabilities arising out of
his or her administrative functions and other responsibilities, including any
expenses and liabilities that are caused by or result from an act or omission
constituting the negligence of such member in the performance of such functions
or responsibilities, but excluding expenses and liabilities that are caused by
or result from such member's own gross negligence or willful misconduct.
Expenses against which such member shall be indemnified hereunder shall include
the amounts of any settlement or judgment, costs, counsel fees and related
charges reasonably incurred in connection with a claim asserted or a proceeding
brought or settlement thereof.


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              Section 8. Assignability. The Company shall have the right to
assign this Plan and to delegate its duties and obligations hereunder, but not
otherwise; provided, however, that no such assignment shall relieve or discharge
the Company of or from any of its obligations under this Plan. Unless otherwise
approved by the Holdings Board, no Participant shall transfer or assign any of
his or her rights under this Plan except by will or the laws of descent and
distribution.

              Section 9. Consolidations, Mergers, etc. Each of Holdings and
Chemicals will require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of its business,
operations or assets to expressly assume and agree to perform this Plan in
writing, in the same manner and to the same extent that Holdings or Chemicals,
as the case may be, would be required to perform hereunder if no such succession
had taken place.

              Section 10. Successors and Assigns. This Plan shall be binding
upon and inure to the benefit of the Company and its successors and assigns.
This Plan and all rights of each Participant shall inure to the benefit of and
be enforceable by such Participant and his or her personal or legal
representatives, executors, administrators, heirs and permitted assigns. If any
Participant should die while any amounts are due and payable to such Participant
hereunder, all such amounts, unless otherwise provided herein, shall be paid in
accordance with the terms of this Plan to such Participant's devisees, legatees
or other designees or, if there be no such devisees, legatees or other
designees, to such Participant's estate.

              Section 11. Notices. All notices and other communications provided
for in this Plan shall be in writing and shall be sent, delivered or mailed,
addressed as follows: (a) if to Holdings, Chemicals or any other Subsidiary, at
Holdings' principal office address or such other address as Holdings may have
designated by written notice to all Participants for purposes hereof, directed
to the attention of the Treasurer, and (b) if to any Participant, at his or her
residence address on the records of Holdings or to such other address as he or
she may have designated to Holdings in writing for purposes hereof. Each such
notice or other communication shall be deemed to have been duly given on the
date it is mailed by United States registered mail, return receipt requested,
postage prepaid (or any substantial equivalent mail delivery of any foreign
country, if applicable), except that any change of notice address shall be
effective only upon receipt.

              Section 12. Tax Withholdings. The Company shall have the right to
deduct from any payment hereunder all taxes (federal, state or other) which it
is required to be withhold therefrom.

              Section 13. No Employment Rights Conferred. Nothing contained in
this Plan shall (a) confer upon any Participant any right with respect to
continuation of employment with the Company or (b) subject to the rights and
benefits of any Participant hereunder, interfere in any way with the right of
the Company to terminate such Participant's employment at any time.

              Section 14. Governing Law. This Plan shall be governed in
accordance with the laws of the State of Texas and any other applicable law.


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              Section 15. Bonus Arrangement. The Plan is intended to be a bonus
program that is designed to provide a pecuniary incentive for eligible employees
(a) to remain in employment by the Company and (b) to produce their best efforts
during the continuance of the Company's bankruptcy proceedings. The Plan is not
intended to provide retirement income or to defer the receipt of payments
hereunder to the termination of a Participant's covered employment or beyond.
The Plan is strictly an incentive bonus program (as described in U.S. Department
of Labor Regulation Section 2510.3-2(c) or any successor thereto), and not a
pension or welfare benefit plan that is subject to the Employee Retirement
Income Security Act of 1974, as amended. All interpretations and determinations
hereunder shall be made on a basis consistent with the Plan's status as a bonus
program.

              IN WITNESS WHEREOF, and as conclusive evidence of the adoption of
this Plan by the Holdings Board and the Chemicals Board, Holdings and Chemicals
have each caused this Plan to be duly executed in its name and behalf by its
proper officer thereunto duly authorized, effective as of the Effective Date.

                                      STERLING CHEMICALS HOLDINGS, INC.



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                                      STERLING CHEMICALS, INC.



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