Item 1.
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Security and Issuer
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This statement on Schedule 13D (this Statement) relates to the common stock, par value $0.10 per share (the Common
Stock) of LSB Industries, Inc., a Delaware corporation (the Issuer). The address of the principal executive offices of the Issuer is 3503 NW 63rd Street, Suite 500, Oklahoma
City, Oklahoma 73116.
This Statement represents Amendment No. 4 to the Schedule 13D (the Original Schedule 13D),
originally filed with the Securities and Exchange Commission (the SEC) by LSB Funding LLC (the Reporting Person) on December 14, 2015, and amended by Amendment No. 1 to the Schedule 13D (the Amendment
No. 1), originally filed with the SEC by the Reporting Person on May 20, 2016, amended by Amendment No. 2 to the Schedule 13D (the Amendment No. 2), originally filed with the SEC by the Reporting Person on
July 20, 2021 and amended by Amendment No. 3 to the Schedule 13D (the Amendment No. 3), originally filed with the SEC by the Reporting Person on September 27, 2021.
All capitalized terms not otherwise defined herein have the meanings set forth in the Original Schedule 13D, Amendment No. 1, Amendment
No. 2 or Amendment No. 3, as applicable.
Item 4.
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Purpose of Transaction
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Item 4 is hereby amended to add the following:
On July 19, 2021, the Reporting Person and the Issuer entered into a Securities Exchange Agreement (the Securities Exchange
Agreement), pursuant to which the Reporting Person and the Issuer agreed to exchange, on the terms and subject to the conditions set forth therein, (a) the 139,768 shares of Series E-1 Cumulative
Redeemable Class C Preferred Stock of the Issuer (the Series E-1 Preferred Stock) held by the Reporting Person for shares of Common Stock and (b) the one (1) share of Series F-1 Preferred Stock held by the Reporting Person for shares of Common Stock (the Series F-1 Preferred Stock and, together with the Series E-1 Preferred Stock, the Preferred Stock), based on the liquidation preference and redemption price, respectively, of the Preferred Stock and a volume weighted average exchange price of $6.16 per share
of Common Stock; provided, that the aggregate number of shares of Common Stock issuable pursuant to clauses (a) and (b) above will be reduced by the number of shares of Common Stock that the Reporting Person will receive in respect of the
payment of the Special Dividend (as defined below) (such net number of shares of Common Stock to be issued, the Issued Shares and such transactions, the Exchange). On September 27, 2021, the Exchange was consummated and
the Issuer issued 49,066,005 Issued Shares to the Reporting Person.
At the closing of the Exchange, the Issuer and the Reporting Person
also entered into certain modifications to the Registration Rights Agreement between the Reporting Person and the Issuer and the Board Representation and Standstill Agreement among the Reporting Person, the Issuer and the other parties thereto, each
as described in the Securities Exchange Agreement. The Amendment and Waiver to Board Representation and Standstill Agreement, dated as of September 27, 2021, by and among the Issuer, the Reporting Person and the other parties thereto
(a) deletes certain prohibited activities, including, among other things, (i) calling a special meeting of the stockholders by the Reporting Person and (ii) the Reporting Person proposing to remove, or voting to remove, any directors
of the Issuer, and (b) shortens the term of the standstill provisions so that they will terminate no later than the second anniversary of the closing date of the Exchange.
In connection with the Exchange, the Issuer declared a stock dividend payable to each holder of record of the Issuers Common Stock on
September 24, 2021 (the Record Date), of 0.30 shares of Common Stock for each share of outstanding Common Stock owned as of the Record Date (the Special Dividend). The Special Dividend was paid on October 8, 2021
and the Reporting Person received 1,220,798 shares of Common Stock.
The description of the Securities Exchange Agreement is a summary
only and is qualified in its entirety by reference to the text of the Securities Exchange Agreement. The Securities Exchange Agreement is incorporated by reference to Exhibit 10.1 to the Issuers Current Report on Form 8-K filed with the SEC on July 20, 2021.
The description of the Amendment and Waiver to Board
Representation and Standstill Agreement is a summary only and is qualified in its entirety by reference to the text of the Amendment and Waiver to Board Representation and Standstill Agreement. The Amendment and Waiver to Board Representation and
Standstill Agreement is incorporated by reference to Exhibit 1 to Amendment No. 3.