On December 21, 2023, LSB Industries, Inc. (the ?Company?) and each of the Company?s subsidiaries signatory thereto entered into a credit agreement (the ?New Revolving Credit Agreement?) with the lenders identified on the signature pages thereof and JPMorgan Chase Bank, N.A, as administrative agent (the ?New Revolving Agent?). The New Revolving Credit Agreement provides for a secured revolving credit facility (the ?New Revolving Credit Facility?) in an initial maximum principal amount of up to $75 million, with an option to increase the maximum principal amount by up to $25 million (which amount is uncommitted). Availability under the New Revolving Credit Facility is subject to a borrowing base, as further set therein, and is subject to an availability block of $7.5 million (which can be removed by the Company in its sole discretion, subject to the satisfaction of certain conditions) (the ?Availability Block?).

The New Revolving Credit Facility provides for a sub-facility for the issuances of letters of credit in an aggregate amount not to exceed to $10 million, with the outstanding amount of any such letters of credit reducing availability for borrowings under the New Revolving Credit Facility. As of the closing of the New Revolving Credit Facility, no amounts were drawn by the Borrowers thereunder. In connection with the closing of the New Revolving Credit Facility, all outstanding amounts under the Company?s Existing Revolving Credit Facility (as defined below), were repaid in full and such facility and all commitments thereunder were terminated.

The New Revolving Credit Facility matures on December 21, 2028, subject springing maturity to the date that is 90 days prior to the stated maturity date of the Company?s existing 6.250% senior secured notes, which is currently October 15, 2028, (unless such senior secured notes have been repaid or redeemed in full prior thereto). Loans outstanding under the New Revolving Credit Facility will bear interest at a rate per annum equal to, at the option of the Company, either (a) term SOFR for a period of one (1) month (with a fallback to the prime rate if such rate is unavailable) (the ?CBFR?), plus 0.10%, plus an applicable margin of 1.625% or (b) term SOFR for a period of one, three or six months (at the Company?s election), plus 0.10%, plus an applicable margin of 1.625%, in each case with a floor of 0.00%. The Company and all of the Company?s subsidiaries (collectively, the ?Borrowers?) are co-borrowers under the New Revolving Credit Facility.

The obligations of the Borrowers under the New Revolving Credit Facility are secured by a first priority security interest in substantially all of the Borrowers? current assets, including accounts receivable and inventory, with exceptions set in the New Revolving Credit Agreement and related loan and security documents, including the Pledge and Security Agreement dated December 21, 2023, by and among the Company, each of the other Borrowers and the New Revolving Agent, as administrative agent for the secured parties with the Administrative Agent (the ?Security Agreement?). The New Revolving Credit Facility contains a financial covenant (the ?Financial Covenant?), which requires that, solely if the Company elects to remove the Availability Block (subject to the satisfaction of certain conditions to such removal), then the Borrowers must maintain a minimum fixed charge coverage ratio of not less than 1.00:1.00.

The Financial Covenant, if triggered, is tested monthly. The New Revolving Credit Facility includes other customary representations and warranties, affirmative covenants, negative covenants and events of default. Upon the occurrence of events of default, the obligations under the New Revolving Credit Facility may be accelerated and the revolver commitments thereunder may be terminated.