10B5-1 SALES PLAN
This
10B5-1 SALES PLAN (the “Sales
Plan”) is dated this 14th day of December 2007, between the XXXXX X. XXXXXX
(“Seller”) and CAPITAL WEST SECURITIES, INC. (“Broker”). For good and
valuable consideration, the receipt of which is acknowledged, Seller and Broker
hereby agree as follows:
1. Background. This
Sales Plan is entered into between Seller and Broker for the purpose of
establishing a trading plan that complies with the requirements of Rule
10b5-1(c)(1) promulgated under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”). Seller is establishing this Sales Plan in order
to permit the disposition of a portion of Seller’s holdings of the common stock,
par value $0.10 per share (the “Stock”), of LSB Industries, Inc, (the
“Issuer”). Seller desires to engage Broker to effect sales of share
of stock in accordance with this Sales Plan. On the date of execution of this
Agreement, which is the date first set forth above, the Seller is not subject
to
any Issuer blackout period restricting the sale of Stock by the
Seller.
2. Appointment
of Broker; Sales. Seller hereby appoints Broker to sell
shares of Stock pursuant to the terms and conditions set forth
below. Subject to such terms and conditions, Broker accepts such
appointment.
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2.1
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Authorizing
Selling. Commencing, Wednesday, January 2, 2008
(the “Effective Date”), and continuing for a period of 12 calendar months
after the Effective Date (the “Effective Period”), Broker is authorized
and directed, from time to time during the Effective Period, to sell
up to
40,000 shares of Stock. Sales of Stock pursuant to this Sales Plan
will be
made at Broker’s discretion on the American Stock Exchange (“AMEX”) at a
price per share equal to the greater of (a) the then current market
price
of the Stock as quoted on the AMEX or (b) $22.90, in each case, such
prices being before deducting any commission, commission equivalent,
xxxx-up or differential, or other expense of
sale.
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2.2
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Market
Disruptions. Seller understands that Broker may
not be able to effect a sale due to a market disruption. If any
sale cannot be executed due to a market disruption, Broker shall
effect
such sales as promptly as practical after the cessation or termination
of
such market disruption pursuant to this Sales
Plan.
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3. Term. This
Sales Plan is effective on the Effective Date. Broker will cease
selling Stock and the Sales Plan will terminate on the earlier of:
(a) January
2, 2009;
(b) the
completion of the sale of 40,000 shares of Stock pursuant to this Sales
Plan;
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(c)
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notice
to Seller or Broker that Seller or Broker is not able to effect the
sale
of Stock under this Sales Plan due to a legal, regulatory or contractual
restriction applicable to Seller or
Broker;
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(d) death
of Seller;
(e) Seller’s
or Broker’s reasonable determination that the Sales Plan does not complywith
Rule 10b5-1 or other applicable securities laws;
(f) written
notice by Seller or Seller’s counsel to Broker informing Broker of
Seller’ssuspension or termination of the Sales Plan; or
(g) written
notice by Broker or Broker’s counsel to Seller informing Seller ofBroker’s
suspension or termination of the Sales Plan.
4. Seller’s
Representations, Warranties and Covenants.
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4.1
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Compliance. As
of the date of this Sales Plan, Seller (a) is not aware of material,
nonpublic information with respect to the Issuer or any securities
of the
Issuer (including the Stock), (b) is not subject to any legal, regulatory
or contractual restriction or undertaking that would prevent Broker
from
conducting sales in accordance with this Sales Plan and (c) is entering
into this Sales Plan in good faith and not as part of a plan or scheme
to
evade the prohibitions of Rule 10b5-1 or compliance with the federal
securities laws.
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4.2
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Notification. Seller
shall immediately notify Broker if Seller becomes subject to a legal,
regulatory or contractual restriction or undertaking that would prevent
Broker from making sales pursuant to this Sales
Plan.
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4.3
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No
Issuer Prohibition. Seller is currently able to
sell shares of Stock in accordance with the Issuer’s xxxxxxx xxxxxxx
policies and Seller has obtained the approval of the Issuer’s counsel to
enter into this Sales Plan.
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4.4
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No
Liens. The shares of Stock subject to the Sales Plan are
free
and clear of liens and encumbrances of any
kind.
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4.5
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No
Disclosure; Hedging. While the Sales Plan is in effect,
Seller will not, directly or indirectly, (a) disclose to any Broker
or any
persons affiliated with Broker who is effecting sales under this
Sales
Plan any information concerning the Stock or the Issuer that might
influence the execution of this Sales Plan or (b) engage in offsetting
or
hedging transactions in violation of Rule
10b5-1.
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4.6
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Exchange
Act Reporting. Seller agrees to make all filings,
if any, required under Sections 13(d) and 16 of the Exchange
Act.
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4.7
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No
Influence. Seller acknowledges and agrees that
Seller does not have, and shall not attempt to exercise, any influence
over how, when, or whether to effect sales of Stock pursuant to this
Sales
Plan.
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5. Rule
144 and Section 16(a) Compliance.
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5.1
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Rule
144. Broker agrees to conduct all sales under this
Sales Plan in accordance with the manner of sale requirement of Rule
144,
if applicable, under the Securities Act of 1933, as amended (the
“Act”), if applicable. If Rule 144 is applicable,
Broker will not effect any sale which would exceed the then applicable
volume limitation under Rule 144, assuming Broker’s sales under this Sales
Plan are the only sales subject to that limitation. Seller
agrees not to take, and agrees to cause any person or entity with
which
Seller would be required to aggregate sales of Stock pursuant to
paragraph
(a) (2) or (e) of Rule 144 not to take any action that would cause
the
sales under this Sales Plan not to comply with Rule
144.
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5.2
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Form
144. Broker will be responsible for completing and
filing on behalf of Seller each required Form 144. Seller
hereby grants Broker a power of attorney to complete and file on
behalf of
Seller Forms 144. Seller understands and agrees that
Broker will make one Form 144 filing at the beginning of each three-month
period commencing on the Effective Date. Each Form 144 filed by
Broker on behalf of Seller shall (a) state that the sales are being
effected in accordance with an existing Sales Plan intended to comply
with
Rule 10b5-1, (b) indicate the date the Sales Plan was adopted, and
(c)
state that the representations are made as of such
date.
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5.3
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Form
4. Broker understands and acknowledges that Seller
is subject to the beneficial ownership reporting requirements of
Section
16(a) of the Exchange Act. Section 16(a) requires Seller to
file a Statement of Changes in Beneficial Ownership of Securities
on Form
4 to report each sale by Broker of the Stock under this Sales
Plan. The required filing date is generally within two business
days following each such sale. To enable Seller to comply with
Seller’s Section 16(a) filing obligations, Broker agrees to notify Seller
immediately following each sale of Stock under this Sales Plan, but
in no
event later than one business day following the date of each such
sale.
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6. Certain
Events.
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6.1
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Stock
Split. In the event of a stock split or reverse
stock split of the Stock, the maximum number of shares of Stock to
be sold
and the minimum price established above in paragraph 2 will be
automatically adjusted
proportionately.
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6.2
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Reorganization. In
the event of a reincorporation or other corporate organization resulting
in an automatic share-for-share exchange of new shares for the type
of
Stock subject to the Sales Plan, then the new shares will automatically
replace the type of Stock originally specified in the Sales
Plan.
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7. General.
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7.1
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Interpretation. This
Sales Plan is intended to comply with the requirements of Rule
10b5-1(c)(1)(i)(B) under the Exchange Act, and this Sales Plan shall
be
interpreted to comply with the requirements of Rule
10b5-1(c).
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7.2
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Broker
Prohibitions. Broker shall immediately notify
Seller if Broker becomes subject to a legal, regulatory or contractual
restriction or undertaking that would prevent Broker from making
sales
pursuant to this Sales Plan.
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7.3
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Amendment. This
Sales Plan may be modified or amended only upon the written agreement
of
Seller and Broker, and only to the extent such modification or amendment
complies with the terms requirements of Rule 10b5-1 as of the date
of the
modification or amendment.
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7.4
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Governing
Law. This Sales Plan shall be governed by and
construed in accordance with the laws of the State of Oklahoma and
may be
modified or amended only by a writing signed by the parties
hereto.
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7.5
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Proceeds. Proceeds
from each sale of Stock effective under this Sales Plan will be delivered
to Seller’s Brokerage account, or such other account as directed in
writing by Seller to Broker.
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7.6
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Counterparts. This
Sale Plan may be signed in any number of counterparts, each shall
be an
original with the same effect as if all of the signatures were upon
the
same instrument.
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7.7
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Reformation. If
any provision of this Sales Plan is or becomes inconsistent with
any
applicable present or future law, rule or regulation, that provision
will
be deemed modified or, if necessary, rescinded in order to comply
with the
relevant law, rule or regulation. All of the provisions of this
Sales Plan will continue and remain in full force and
effect.
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IN
WITNESS WHEREOF,
the undersigned have signed this Sales Plan as of the date first written
above.
XXXXX
X. XXXXXX
By:
Xxxxx
X. Xxxxxx
(“Seller”)
CAPITAL
WEST SECURITIES, INC.
By:
Name:
Title:
(“Broker”)
