LSB INDUSTRIES, INC. (2008 Stock Incentive Plan) INCENTIVE STOCK OPTION AGREEMENT

Exercise of Option.  The Exercise Price is the price per share of common stock acquired upon exercise of the Option.  The Option will be exercisable as specified herein and in the Plan by written notice directed to the Company at its principal place of business setting forth the exact number of Option Shares that Participant is purchasing.  The Option will not be deemed to be exercised until the Exercise Price for the number of Option Shares to be purchased is collected by the Company, and Participant has complied with such other reasonable requirements as the Committee may establish.  Payment of the Exercise Price for the number of Option Shares to be acquired upon exercise of the Option will be by (a) check or wire transfer, or (b) only if the date of notice of exercise is not within a “blackout” period or other period during which the Participant is prohibited under law or policies adopted by the Company from trading in the Company’s securities, by tendering by attestation shares of Common Stock already owned by the Participant that on the day prior to the exercise date have a Fair Market Value equal to the aggregate exercise price of the shares being purchased under the Option, provided that the Participant must have held for at least six months any such tendered shares that were acquired by the Participant under a Company-sponsored stock compensation program.  The Option may not be exercised after the Expiration Date.  The exercise of the Option will be subject to such additional administrative procedures as may be adopted by the Committee from time to time.

Vesting.  The Option will vest and be exercisable in six installments, based upon Participant’s years of continuous employment with the Company or an Affiliate from the Grant Date, as follows:

16.5% of the Option Shares will vest and be exercisable after one year;

an additional 16.5% of the Option Shares will vest and be exercisable after two years;

an additional 16.5% of the Option Shares will vest and be exercisable after three years;

an additional 16.5% of the Option Shares will vest and be exercisable after four years;

an additional 16.5% of the Option Shares will vest and be exercisable after five years; and

100% of the Option Shares will vest and be exercisable after six years.

Exercise after Termination of Service.  The Option may not be exercised after a Termination of Service (as defined in the Plan), except as follows:

Disability.  If the Termination of Service is on account of a Disability (as defined in the Plan), Participant may exercise the Option within 12 months after the date of Termination of Service.

Death.  If Participant dies prior to the termination of the Option, the Option may be exercised within 12 months after the death of Participant by the personal representative of Participant’s estate, or by a person who acquired the right to exercise the Option by bequest, inheritance, or by reason of the death of Participant; provided that (a) Participant died while an employee of the Company or an Affiliate; or (b) Participant ceased to be an employee of the Company or an Affiliate on account of a Disability and died within three months after the date of Termination of Service.

Investment Representation.  If Option Shares issued pursuant to the exercise of the Option are not subject to an effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”), Participant agrees to represent and warrant in writing at the time of any exercise of the Option or any portion thereof that the Option Shares are being purchased only for investment and without any present intention to sell or distribute such shares, and further agrees that the certificate representing Option Shares so acquired may bear an appropriate legend and will be sold or transferred only in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) or any applicable law, regulation, or rule of any governmental agency.

Taxes.  Participant shall pay all original issue or transfer taxes and all other fees and expenses incident to the issue, transfer, or delivery of Option Shares.

Not Assignable.  The Option or any interest on the Option may not be sold, assigned, pledged (as collateral for a loan or as security for the performance of an obligation or for any other purpose) or transferred by Participant or made subject to attachment or similar proceedings otherwise than by will or by the applicable laws of descent and distribution, except that to the extent permitted by the Committee, in its sole discretion, a Participant may designate on a Company-approved form one or more beneficiaries who may receive Option Shares under the Option after Participant’s death. During a Participant’s lifetime, the Option may be exercised only by Participant.

No Rights until Issue.  No right to vote or receive dividends or any other rights as a stockholder of the Company will exist with respect to the Option Shares, notwithstanding the exercise of the Option, until the issuance to Participant of a stock certificate or certificates representing such shares.

Anti-dilution.  In the event of a stock dividend, stock split, spin-off, combination or exchange of shares, recapitalization, merger, consolidation, distribution to shareholders other than a normal cash dividend or other change in the Company’s corporate or capital structure, then the Committee shall make proportional adjustments in the Option and/or the Plan as described in the Plan.

Delivery of Option Shares.  The Company will deliver the shares of common stock to be acquired upon the exercise of the Option within a reasonable period following (a) the receipt of the written notice of exercise, (b) collection of payment in full of the Exercise Price for such shares, and (c) Participant’s payment of any tax withholding obligations in accordance with paragraph 6 of this Agreement.  If any law, regulation or stock exchange requires the Company to take any action with respect to such shares before the issuance thereof, then the date of delivery of such shares shall be extended for the period necessary to take such action.

Limitation.  To the extent that the aggregate Fair Market Value of common stock exercisable for the first time by Participant during any calendar year exceeds $100,000 or, if different, the maximum limitation in effect at the time of grant under the Code (the Fair Market Value being determined as of the Grant Date), such portion in excess of $100,000 will be treated as Non-qualified Stock Options.