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                             INDUSTRIAL PLANT LEASE


         THIS INDUSTRIAL PLANT LEASE, dated effective as of midnight on the 31st
day of October, 2000, is entered into by and between Cherokee Nitrogen Company,
an Oklahoma corporation ("Lessor"), and El Dorado Chemical Company, an Oklahoma
corporation ("Lessee").

         1. Lease. Lessor agrees to lease to Lessee, and Lessee agrees to lease
from Lessor, all of the real property situated in the Town of Cherokee, Colbert
County, Alabama, described on Exhibit "A" attached hereto, but excluding that
portion used as farm land on the west side of the manufacturing facility,
together with all buildings, fixtures and other improvements located thereon and
appurtenances thereto belonging, including, without limitation, adequate ways of
ingress and egress directly between the improvements on the property and public
roads, walkways and parking areas (the "Property"), and all of those items of
personal property which constitute a chemical plant, excluding stores of spare
or replacement parts and excluding catalyst (collectively the "Equipment") which
are located on the Property or associated therewith (the Property and Equipment
are collectively referred to as the "Premises").

         2. Definitions. As used in this Lease, the following terms shall have
the following meanings (such definitions to be equally applicable to both the
singular and plural forms of the terms defined):

                  "Business Day" shall mean a day other than a Saturday, Sunday
         or legal holiday under the laws of the State of Oklahoma.

                  "Commencement Date" as defined in Section 3 hereof.

                  "Default" shall mean any event or condition which after the
         giving of notice or lapse of time or both would become an Event of
         Default.

                  "Equipment" as defined in Section 1 hereof.

                  "Event of Default" as defined in Section 22 hereof.

                  "Event of Loss" shall mean, with respect to any part of the
         Premises, the actual or constructive total loss or the use thereof, due
         to theft, destruction, damage beyond repair or rendition thereof as
         being permanently unfit for normal use from any reason whatsoever, or
         the condemnation, confiscation or seizure of, or requisition of title
         to or use of, the Premises.

                  "Imposition" as defined in Section 11 hereof.

<PAGE>   2

                  "Indemnitee" as defined in Section 21 hereof.

                  "Late Charge Rate" shall mean an interest rate per annum equal
         to eighteen percent (18%), but not to exceed the highest rate permitted
         by applicable law.

                  "Lease" and the terms "hereof", "herein", "hereto" and
         "hereunder", when used in this Industrial Plant Lease, shall mean and
         include this Industrial Plant Lease, as the same may from time to time
         be amended, modified or supplemented.

                  "Lease Term" shall mean the term of this Lease set forth in
         Section 3 hereof.

                  "Lessee" as defined in the introductory paragraph of this
         Lease.

                  "Lessor" as defined in the introductory paragraph of this
         Lease.

                  "Lien" shall mean any mortgage, pledge, lien, security
         interest, charge, encumbrance, financing statement, title retention or
         any other right or claim of any person, other than any Lessor's Lien.

                  "Premises" as defined in Section 1 hereof.

                  "Property" as defined in Section 1 hereof.

         3. Term. The term of this Lease shall commence on midnight of October
31, 2000 (the "Commencement Date") and shall continue for a term of one (1)
year, unless earlier terminated pursuant to the provisions hereof (the "Lease
Term"). It is expressly understood that neither party hereto has an option or
right to renew this Lease.

         4. Rent; Unconditional Obligations.

                  a. During the Lease Term, Lessee shall pay to Lessor rent for
         the Premises in the total aggregate amount of One Million Three Hundred
         Fifty Thousand and No/100 Dollars ($1,350,000.00), payable in nine (9)
         consecutive monthly installments at a rate of One Hundred Fifty
         Thousand and No/100 Dollars ($150,000.00) per month, with the first
         installment of rent being due and payable within twenty (20) days of
         the Commencement Date. Subsequent rental payments shall be due on the
         last day of each calendar month during the Lease Term. Accordingly, the
         second rental payment is due and payable on November 30, 2000, with the
         last rental payment due payable on June 30, 2001. Upon receipt by
         Lessor of the ninth (9th) rental installment from Lessee, this Lease
         will be fully paid up and no further rent shall be due hereunder. Rent
         shall be payable in lawful tender of the United States of America and
         paid to Lessor at the address of Lessor as provided in Section 27
         hereof or such other place as Lessor may from time to time designate.

<PAGE>   3

                  b. Lessee shall also pay to Lessor, on demand, interest at the
         Late Charge Rate on any installment of rent and on any other amount
         owing hereunder which is not paid within ten (10) days of the date when
         due, for any period for which the same shall be overdue.

                  c. This Lease is a net lease, and Lessee's obligation to pay
         all rent and all other amounts payable hereunder is ABSOLUTE AND
         UNCONDITIONAL under any and all circumstances and shall not be affected
         by any circumstances of any character whatsoever, including, without
         limitation, (i) any set-off, counterclaim, recoupment, defense,
         abatement or reduction or any right which Lessee may have against
         Lessor or anyone else for any reason; (ii) any defect in the title,
         condition, design, or operation of, or lack of fitness for use of, or
         any damage to, or loss of, all or any part of the Premises from any
         cause whatsoever; or (iii) the invalidity, unenforceability or
         disaffirmance of this Lease or any other document related hereto.
         Lessee hereby waives, to the extent permitted by applicable law, any
         and all rights which it may now have or which may at any time hereafter
         be conferred upon it, by statute or otherwise, to terminate, cancel,
         quit or surrender the lease of all or any part of the Premises.

         5. Disclaimer. LESSOR NEITHER MAKES NOR SHALL BE DEEMED TO HAVE MADE
AND LESSEE HEREBY EXPRESSLY WAIVES ANY WARRANTY OR REPRESENTATION, EITHER
EXPRESS OR IMPLIED, AS TO THE PREMISES, INCLUDING, WITHOUT LIMITATION, ANY
WARRANTY OR REPRESENTATION AS TO THE DESIGN, QUALITY OR CONDITION OF THE
PREMISES OR ANY WARRANTY OF MERCHANTABILITY OR FITNESS OF THE PREMISES FOR ANY
PARTICULAR PURPOSE, OR AS TO THE TITLE TO OR LESSOR'S OR LESSEE'S INTEREST IN
THE PREMISES, OR AS TO ANY OTHER MATTER RELATING TO THE PREMISES OR ANY PART
THEREOF.

         LESSEE CONFIRMS THAT IT HAS SELECTED THE PREMISES ON THE BASIS OF ITS
OWN JUDGMENT, ACCEPTS THE PREMISES IN ITS EXISTING CONDITION AND EXPRESSLY
DISCLAIMS RELIANCE UPON ANY STATEMENTS, REPRESENTATIONS OR WARRANTIES MADE BY
LESSOR.

         6. Surrender. Lessee shall, upon the expiration of the Lease Term,
surrender possession of the Premises to Lessor. Lessee shall not continue to
occupy the Premises, beyond the Lease Term. At the time of such return, the
Premises shall be in the condition and repair required to be maintained by
Section 12 hereof and free and clear of all Liens.

         7. Representations and Warranties. In order to induce Lessor to enter
into this Lease and to lease the Premises to Lessee hereunder, Lessee represents
and warrants that:

                  a. Organization. Lessee is a corporation duly organized,
         validly existing and in good standing under the laws of the State of
         Oklahoma and is qualified to do


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<PAGE>   4

          business as a foreign corporation and is in good standing under the
          laws of the State of Alabama.

                  b. Power and Authority. Lessee has full power, authority and
         legal right to execute, deliver and perform this Lease, and the
         execution, delivery and performance hereof has been duly authorized by
         all necessary corporate action of Lessee.

                  c. Enforceability. This Lease has been duly executed and
         delivered by Lessee and constitutes a legal, valid and binding
         obligation of Lessee enforceable in accordance with its terms.

                  d. Consents and Permits. The execution, delivery and
         performance of this Lease will not contravene any law, regulation,
         judgment or decree applicable to Lessee, or the certificate of
         incorporation or by-laws of Lessee, or contravene the provisions of, or
         constitute a default under, or result in the creation of any Lien upon
         any property of Lessee under any mortgage, instrument or other
         agreement to which Lessee is a party or by which Lessee or its assets
         may be bound or affected.

                  e. No Defaults. Lessee is not in default, and no event or
         condition exists which after the giving of notice or lapse of time or
         both would constitute an event of default, under any mortgage,
         indenture, contract, agreement, judgment or other undertaking to which
         Lessee is a party or which purports to be binding upon Lessee or upon
         any of its assets, except for any such default, event or condition
         which, individually or in the aggregate, would not affect Lessee's
         ability to perform its obligations under this Lease or any such
         mortgage, indenture, contract, agreement, judgment or other
         undertaking.

                  f. No Litigation. There is no action, suit, investigation or
         proceeding by or before any court, arbitrator, administrative agency or
         other governmental authority pending or threatened against or affecting
         Lessee which involves the Premises or the transactions contemplated by
         this Lease; or which, if adversely determined, would have a material
         adverse effect on the financial condition, business or operations of
         Lessee.

                  g. Taxes. Lessee has filed all Federal, state and local income
         tax returns that are required to be filed, and has paid all taxes as
         shown on said returns and all assessments received by it to the extent
         that such taxes and assessments have become due, and Lessee does not
         have any knowledge of any actual deficiency or additional assessment in
         connection therewith, except for taxes being contested in good faith
         and by appropriate proceedings and for which adequate reserves or a
         bond has been established. The charges, accruals and reserves on the
         books of Lessee in respect of Federal, state and local taxes for all
         open years, and for the current fiscal year, make adequate provision
         for all unpaid tax liabilities for such periods.


                                       4
<PAGE>   5
         8. Covenant of Peaceful Possession. Lessor covenants and warrants that
if Lessee shall discharge the obligations set forth in this Lease to be
performed by Lessee, Lessee shall peaceably have, hold and enjoy the quiet
undisturbed possession of the Premises, together with all the appurtenances
thereto, without hindrance, ejection, disturbance or molestation by Lessor or
any person or entity claiming through or under Lessor

         9. Liens. Lessee will not create, incur, assume or suffer to exist any
Lien on or with respect to the Premises.

         10. Insurance. Lessee shall maintain on the Premises, at its expense,
"all-risk" physical damage insurance and comprehensive general and/or automobile
(as appropriate) liability insurance (covering bodily injury and property damage
exposures, including, but not limited to, contractual liability and product
liability) in such amounts, against such risks, in such form and with such
insurers as shall be satisfactory to Lessor; provided, that the amount of
"all-risk" physical damage insurance shall not on any date be less than full
replacement value. Each physical damage insurance policy will name Lessor as
loss payee. Each liability insurance policy will name Lessor as additional
insured. Additionally, each insurance policy will, among other things, require
that the insurer give Lessor, as certificate holder, at least thirty (30) days
prior written notice (at the addresses for notice to Lessor set forth in Section
27 hereof) of any alteration in or cancellation of the terms of such policy. In
no event shall Lessor be responsible for premiums, warranties or representations
to any insurer or any agent thereof. At Lessor's option, Lessee shall furnish to
Lessor a certificate or other evidence satisfactory to Lessor that such
insurance coverage is in effect; provided, however, that Lessor shall be under
no duty to ascertain the existence or adequacy of such insurance. The insurance
maintained by Lessee shall be primary without any right of contribution from
insurance which may be maintained by Lessor.

         11. Taxes; General Tax Indemnity. During the Lease Term, Lessee hereby
agrees to pay and to indemnify and hold Lessor harmless from and against, all
fees, taxes (whether sales, use, excise, personal property or other taxes),
imposts, duties, withholdings, assessments and other governmental charges of
whatever kind or character, however designated (together with any penalties,
fines or interest thereon), all of the foregoing being herein collectively
called the "Impositions", which are at any time levied or imposed against
Lessor, Lessee, this Lease, the Premises or any part thereof by any federal,
state or local government or taxing authority in the United States or by any
foreign government or any subdivision or taxing authority thereof upon, all with
respect to, as a result of or measured by (a) the Premises (or any part
thereof), or this Lease or the interest of the Lessor therein; or (b) the
leasing, possession, maintenance, use, or operation of the Premises or any part
thereof; or (c) the rentals, receipts or earnings payable under this Lease or
otherwise arising from the Premises or any part thereof; excluding, however,
taxes based on or measured by the net income of Lessor that are imposed by (i)
the United States of America, or (ii) any State of the United States of America
or any political subdivision of any such State. Lessor shall pay, and,


                                       5
<PAGE>   6
promptly upon receipt of Lessor's invoice therefor, Lessee shall reimburse
Lessor for paying, the Impositions, unless Lessor and Lessee shall agree in
writing that Lessee will pay any Impositions directly. In case any report or
return is required to be filed with respect to any obligation of Lessee under
this Section 11 or arising out of this Section 11, Lessor shall make such report
or return in such manner to show the ownership of the Premises in Lessor, unless
Lessor and Lessee shall agree in writing that Lessee shall file any reports or
returns. The obligations of Lessee under this Section 11 shall survive the
expiration or earlier termination of this Lease.

         12. Compliance with Laws; Operation and Maintenance; Additions;
Notices.

                  a. Lessee may use the Premises in a careful and proper manner
         for the purpose of operating a chemical plant or any other lawful
         business and will use reasonable efforts to conform to and comply with
         all governmental laws, rules and regulations relating thereto. Further,
         Lessee agrees to maintain its existence as a legal entity and obtain
         and keep in full force and effect all material rights, franchises,
         licenses and permits which are necessary for the operation of the
         Premises and obtain or cause to be obtained as promptly as possible any
         governmental, administrative or agency approval and make any filing or
         registration therewith which at the time shall be required with respect
         to the performance of its obligations under this Lease and the proper
         operation of the Premises.

                  b. Lessee will, at its own expense, keep and maintain the
         Premises, including the parking areas, sidewalks and roads, in good
         repair, condition and working order, reasonable wear and tear excepted.

                  c. Lessee will not make or authorize any improvement, change,
         addition or alteration to the Premises (i) if such improvement, change,
         addition or alteration will impair the originally intended function or
         use of the Premises or impair the value of the Premises as it existed
         immediately prior to such improvement, change, addition or alteration;
         or (ii) if any parts or materials installed in or attached to or
         otherwise becoming a part of the Premises as a result of any such
         improvement, change, addition or alteration shall not be removable
         without damage to the Premises. Any part or material which is added to
         the Premises without violating the provisions of the immediately
         preceding sentence and which is not a replacement or substitution for
         any property which was a part of the Premises, shall remain the
         property of Lessee and may be removed by Lessee at any time prior to
         the expiration or earlier termination of the Lease Term. All such parts
         or materials shall be and remain free and clear of any Liens. Any such
         part or material which is not so removed upon the expiration or earlier
         termination of the Lease Term shall, without further act, become the
         property of Lessor.


                                       6
<PAGE>   7
                  d. Lessee will promptly give written notice to Lessor of (i)
         the occurrence of any Default or Event of Default; (ii) the occurrence
         of any Event of Loss; (iii) the commencement of any material litigation
         or proceeding affecting the Premises; and (iv) any material dispute
         between Lessee and any governmental regulatory body or other party that
         involves the Premises.

         13. Signs. Lessee shall have the right to place signs or other
advertising devices, electrical or non-electrical, on the Premises; provided,
however, the same is in compliance with all applicable law.

         14. Utilities. Lessee shall pay for all water, gas, light, power,
telephone service and all other utilities supplied to the Premises.

         15. Environmental Indemnity by Lessee.

                  a. Lessee agrees to keep and maintain the Premises in material
         compliance with any environmental law. Lessee agrees to indemnify,
         defend and hold Lessor, its parent, subsidiary and affiliate companies,
         and their respective officers, directors, employees and agents,
         successors and assigns harmless from and against all penalties, claims,
         orders, judgments, expenses, fines, remedies (including, but not
         limited to, damages), costs (including, but not limited to, reasonable
         attorneys' fees and litigation costs), liabilities and losses directly
         or indirectly caused by, or arising directly or indirectly from, or
         directly or indirectly related to, any actual or alleged pollution,
         release, contamination, discharge, dumping or any other actual or
         alleged environmental violation or harm or threat of whatever type or
         nature (including, but not limited to, any violation of laws or for the
         violation of any federal, state or local statutes or regulations
         currently enacted or made effective after the date hereof and which are
         intended to be, or are being, applied for protecting or preserving the
         environment) (the "Environmental Claims") occurring on, coming on, in
         or under or emanating from the Premises during the Lease Term caused by
         Lessee or in connection with the operation of the Premises by Lessee.

                  b. The indemnifications provided for by Section 15 shall
         constitute the exclusive remedy of Lessor with respect to claims for
         any Environmental Claim, whether any claims or causes of action
         asserted with respect to any such matters are brought in contract,
         tort, strict liability, statute or any other legal theory or
         combination of theories whatsoever.

                  c. Lessor shall, on each occasion that indemnification is
         sought, give prompt written notice for such indemnification, of any
         claim, suit or demand which Lessor believes will give rise to
         indemnification to Lessee hereunder. Except as hereafter provided,
         Lessee shall be obligated to defend and to direct the defense against
         any such claim, suit or demand, in its name or in the name of Lessor at
         Lessee's


                                        7
<PAGE>   8

         expense and with counsel of Lessee's own choosing and the right to
         settle or compromise any such claim, suit or demand; provided, however,
         that Lessee will not, without Lessor's written consent, settle or
         compromise any claim or consent to any entry of judgment which does not
         include as an unconditional term thereof the giving by the claimant or
         the plaintiff to Lessor of a release from all liability in respect of
         such claim. Lessor shall, at Lessee's expense, cooperate in the defense
         of any such claim, suit or demand. If Lessee, within a reasonable time
         after notice of a claim, fails to defend Lessor, Lessor shall be
         entitled to undertake the defense, compromise or settlement of such
         claim at the expense of and for the account and risk of Lessee,
         utilizing counsel of Lessor's own choosing.

         16. Environmental Indemnity by Lessor.

                  a. Lessor agrees to indemnify, defend and hold Lessee, its
         parent, subsidiary and affiliate companies, and their respective
         officers, directors, employees and agents, successors and assigns
         harmless from and against all penalties, claims, orders, judgments,
         expenses, fines, remedies (including, but not limited to, damages),
         costs (including, but not limited to, reasonable attorneys' fees and
         litigation costs), liabilities and losses directly or indirectly caused
         by, or arising directly or indirectly from, or directly or indirectly
         related to, any Environmental Claim occurring on, coming on, in or
         under or emanating from the Premises prior to the Commencement Date.

                  b. The indemnifications provided for by Section 16 shall
         constitute the exclusive remedy of Lessee with respect to claims for
         any Environmental Claim, whether any claims or causes of action
         asserted with respect to any such matters are brought in contract,
         tort, strict liability, statute or any other legal theory or
         combination of theories whatsoever.

                  c. Lessee shall, on each occasion that indemnification is
         sought, give prompt written notice for such indemnification, of any
         claim, suit or demand which Lessee believes will give rise to
         indemnification to Lessor hereunder. Except as hereafter provided,
         Lessor shall be obligated to defend and to direct the defense against
         any such claim, suit or demand, in its name or in the name of Lessee at
         Lessor's expense and with counsel of Lessor's own choosing and the
         right to settle or compromise any such claim, suit or demand; provided,
         however, that Lessor will not, without Lessee's written consent, settle
         or compromise any claim or consent to any entry of judgment which does
         not include as an unconditional term thereof the giving by the claimant
         or the plaintiff to Lessee of a release from all liability in respect
         of such claim. Lessee shall, at Lessor's expense, cooperate in the
         defense of any such claim, suit or demand. If Lessor, within a
         reasonable time after notice of a claim, fails to defend Lessee, Lessee
         shall be entitled to undertake the defense, compromise or


                                        8
<PAGE>   9

         settlement of such claim at the expense of and for the account and risk
         of Lessor, utilizing counsel of Lessee's own choosing.

         17. Condemnation.

                  a. If, after the execution and prior to the termination of
         this Lease, the whole of the Premises shall be taken under the power of
         eminent domain by any public or private authority, then this Lease and
         the term hereof shall cease and terminate as of the date of such
         taking, with the right of Lessee, at its election, to continue to
         occupy the Premises, subject to the terms of this Lease, for all or
         such part, as Lessee may determine, of the period between the date of
         such taking and the date when possession of the Premises shall be taken
         by the taking authority, and any unearned rent or other charges, if
         any, paid in advance, shall be refunded to Lessee. If required, Lessee
         shall procure from the applicable governmental authority, at Lessee's
         expense, all necessary consents and authorizations to continue to
         occupy the Premises from and after the date of such taking.

                  b. If, after the execution and prior to the termination
         hereof, any public or private authority shall, under the power of
         eminent domain, make a taking:

                          (i) Resulting in the reduction of the ground floor
                  area of the building on the Premises by twenty percent (20%)
                  or more, or

                          (ii) Resulting in the reduction of the parking area on
                  the Premises by twenty percent (20%) or more, then Lessee may,
                  at its election, terminate this Lease by giving Lessor notice
                  of the exercise of its election within sixty (60) days of the
                  date of notice to Lessee of such taking (or purchase). In the
                  event of termination by Lessee under this Section 17, this
                  Lease shall cease and terminate as of the last day of the
                  calendar month in which such notice of exercise of its
                  election to terminate has been given, and any unearned rent or
                  other charges, if any, paid in advance, shall be refunded to
                  Lessee.

                  c. In the event that Lessee, having such right, shall not
         elect to terminate as aforesaid, then this Lease and the term hereof
         shall continue in full force and effect, and Lessor shall, at its
         expense, forthwith restore what may remain of the Premises, including
         any and all improvements made theretofore, and the parking areas, to
         substantially the same condition they were in prior to such taking and
         a just proportion of the rent provided in Section 4 hereof, and any
         other charges payable by Lessee hereunder, according to the nature and
         extent of the injury to the Premises and Lessee's business shall be
         suspended or abated until what may remain of the Premises and the
         parking areas, shall be restored as aforesaid, and thereafter a just
         proportion of the rent and any such other charges according to the
         nature and extent of the taking and resulting injury to the Premises
         and Lessee's business shall be permanently abated for


                                        9
<PAGE>   10
          the balance of the Lease Term. In computing the amount of
          proportionate rent reduction as herein provided, due consideration
          shall be given to the value of the portion of the area so taken in
          condemnation with relation to the remaining area insofar as the use
          thereof for Lessee's business is concerned, and to the effect of such
          taking on Lessee's business, and the amount of parking area and the
          value of what remains insofar as the use thereof for Lessee's business
          is concerned.

                  d. All compensation awarded or paid for losses or damages to
         the Premises or losses or damages to Lessor for loss of its leasehold
         interest upon such a total or partial taking of the Premises under the
         power of eminent domain shall belong to and be the property of Lessor;
         provided however, that nothing contained herein shall be construed to
         preclude Lessee from (i) prosecuting and filing, and Lessee shall be
         entitled to prosecute and file, a claim directly against the condemning
         authority in such condemnation proceedings for loss of or damage to
         Lessee's business or suffered by Lessee due to loss of its leasehold
         interest, depreciation to, damage to, or cost of removal of, or for
         value of stock, trade fixtures, furniture and other personal property
         belonging to Lessee, as a result of the partial or complete taking of
         the Premises, and (ii) collecting and retaining any damages awarded
         Lessee in connection therewith.

         18. Inspection. Lessor or its authorized representatives may at any
reasonable time or times inspect the Premises.

         19. Identification. Upon the request of Lessor in writing, Lessee
shall, at its expense, attach to each item of Equipment a notice satisfactory to
Lessor disclosing Lessor's ownership of such item of Equipment.

         20. Loss or Damage.

                  a. All risk of loss, theft, damage or destruction to the
         Premises or any part thereof, however incurred or occasioned, shall be
         borne by Lessee. Lessee shall promptly give Lessor written notice
         thereof and subject to paragraph (d) of this Section 20, shall promptly
         cause the affected part or parts of the Premises to be replaced or
         restored to the condition and repair required to be maintained by
         Section 12 hereof.

                  b. Unless a Default or Event of Default shall be continuing,
         any payments received at any time by Lessor or Lessee from any insurer
         with respect to loss or damage to the Premises shall be paid over to
         Lessee to reimburse Lessee for its payment of the costs and expenses
         incurred by Lessee in replacing or restoring, pursuant to paragraph (a)
         of this Section 20, the part or parts of the Premises which suffered
         such loss or damage. If Lessee fails to replace or restore the Premises
         as provided herein within sixty (60) days from the date of such loss or
         damage, all of such insurance payments shall be paid over to Lessor.


                                       10
<PAGE>   11
                  c. During the period from the date of such loss or damage
         until the Premises are repaired and restored, the rent payable by
         Lessee hereunder shall be abated proportionately according to that
         portion of the Premises which is usable by Lessee after such loss or
         damage. Such abatement shall continue for the period commencing with
         such loss or damage and ending with the completion of the work or
         repair. In the event that this Lease is terminated due to exercise of
         the termination option pursuant to paragraph (d) of this Section 20,
         the rent shall be completely abated from the date of the loss or
         damage.

                  d. Notwithstanding anything herein to the contrary, in the
         event that twenty-five percent (25%) or more of any part of the
         Premises are damaged or destroyed or rendered untenantable by fire or
         other casualty, Lessee may, at its option, terminate this Lease
         effective as of the date of such casualty, by giving to Lessor thirty
         (30) days after the happening of such casualty written notice of such
         termination.

         21. General Indemnity. Lessee assumes liability for, and shall
indemnify, protect, save and keep harmless Lessor and its agents, servants,
successors and assigns (the "Indemnitee") from and against any and all
liabilities, obligations, losses, damages, penalties, claims, actions, suits,
costs and expenses, on, incurred by or asserted against any Indemnitee, in any
way relating to or arising out of this Lease or the enforcement hereof, or the
acceptance, rejection, possession, use, selection, lease, operation, or
condition of the Premises or any part thereof (including, without limitation,
latent or other defects, whether or not discoverable by Lessee or any other
person, any claim in tort for strict liability and any claim for patent,
trademark or copyright infringement); provided, however, that Lessee shall not
be required to indemnify any Indemnitee for loss or liability arising from acts
or events which occur after the Premises have been surrendered to Lessor in
accordance with this Lease, or for loss or liability resulting solely from the
willful misconduct or gross negligence of such Indemnitee. Any payments made by
Lessee under this Section 21 shall be made on an after-tax basis. The provisions
of this Section 21 shall survive the expiration or earlier termination of this
Lease.

         22. Events of Default. The following events shall each constitute an
event of default ("Event of Default") under this Lease:

                  a. Lessee shall fail to make any payment of rent or other
         amount owing hereunder when due and such failure continues ten (10)
         days after written notice by Lessor to Lessee of such failure; or

                  b. Lessee shall fail to materially perform or observe any
         warranty, covenant, condition or agreement to be performed or observed
         by it with respect to this Lease (except the payment of rent) and such
         failure shall continue unremedied for thirty (30) days after the
         earlier of (i) the date on which Lessee obtains, or should have


                                       11
<PAGE>   12
         obtained knowledge of such failure; or (ii) the date on which written
         notice thereof shall be given by Lessor to Lessee; or

                  c. any representation or warranty made by Lessee herein or in
         any document, certificate or financial or other statement now or
         hereafter furnished Lessor in connection with this Lease shall prove at
         any time to be untrue or misleading in any material respect as of the
         time when made; or

                  d. the entry of a decree or order for relief by a court having
         jurisdiction in respect of Lessee, adjudging Lessee bankrupt or
         insolvent, or approving as properly filed a petition seeking a
         reorganization, arrangement, adjustment or composition of or in respect
         of Lessee in an involuntary proceeding or case under the Federal
         bankruptcy laws, as now or hereafter constituted, or any other
         applicable Federal, state or foreign bankruptcy, insolvency or other
         similar law, or appointing a receiver, liquidator, assignee, custodian,
         trustee or sequestrator (or similar official) of Lessee or of any
         substantial part of its property, or ordering the winding-up or
         liquidation of its affairs, and the continuance of any such decree or
         order unstayed and in effect for a period of sixty (60) days; or

                  e. the institution by Lessee of proceedings to be adjudicated
         bankrupt or insolvent, or the consent by it to the institution of
         bankruptcy or insolvency proceedings against it, or the commencement by
         Lessee of a voluntary proceeding or case under the Federal bankruptcy
         laws, as now or hereafter constituted, or any other applicable Federal,
         state or foreign bankruptcy, insolvency or other similar law, or the
         consent by it to the filing of any such petition or to the appointment
         of or taking possession by a receiver, liquidator, assignee, trustee,
         custodian or sequestrator (or other similar official) of Lessee or of
         any substantial part of its property, or the making by it of any
         assignment for the benefit of creditors or the written admission by it
         of its inability to pay its debts generally as they become due or its
         willingness to be adjudicated bankrupt or the taking of corporate
         action by Lessee in furtherance of any of the foregoing.

         23. Remedies.

                  a. If an Event of Default specified in Sections 22(d) or (e)
         above shall occur, then, and in any such event, this Lease shall,
         without any declaration or any other action by Lessor, be in Default,
         and without any notice or declaration from Lessor and without any
         action or demand by Lessor, all rents due and to become due under this
         Lease and other amounts owing under or with respect to this Lease shall
         be immediately due and payable by Lessee to Lessor, all present valued
         at the discount rate of five percent (5%). If an Event of Default,
         other than an Event of Default specified in Sections 22(d) or (e)
         above, shall occur and be continuing Lessor may, by written notice of
         Default given to Lessee declare this Lease to be in Default, whereupon
         all rents due and to become due under this Lease, and all other amounts


                                       12
<PAGE>   13

         payable under or with respect to this Lease, all present valued at the
         discount rate of five percent (5%), shall become immediately due and
         payable without presentment, demand, protest or other notice of any
         kind, all of which are hereby expressly waived. During the continuance
         of any Event of Default hereunder, Lessor shall have the right to
         pursue and enforce any of its rights and remedies under this Section 23
         and as provided under applicable law.

                  b. If an Event of Default shall occur and be continuing,
         Lessor may re-enter the Premises as the agent of Lessee, without being
         liable for any prosecution or damages therefore, and may relet the
         Premises as the agent of Lessee, and receive the rent therefore, upon
         such terms as shall be reasonably satisfactory to Lessor, and all
         rights of Lessee to repossess the Premises under this Lease shall be
         forfeited. Such re-entry by Lessor under and pursuant to the terms of
         this Section 23 shall not operate to release Lessee from any rent to be
         paid or covenants to be performed hereunder during the Lease Term. For
         the purpose of reletting, Lessor shall be authorized to make such
         repairs as may be necessary to place the same in substantially the
         order and condition that such was in as of the date of this Lease,
         ordinary wear and tear excepted. If the sum realized or to be realized
         from the reletting is insufficient to satisfy the monthly or term rent
         provided in this Lease, Lessor, at its option, may require Lessee to
         pay such deficiency month by month, or may hold Lessee in advance for
         the entire deficiency to be realized during the term of the reletting.
         Lessor shall exercise diligent efforts to mitigate any such costs or
         damages.

                  c. Lessee shall be liable for any and all unpaid rent and
         other amounts due hereunder before or during the exercise of any of the
         foregoing remedies and for all reasonable legal fees and necessary
         other costs and expenses incurred by reason of the occurrence of any
         uncured Event of Default and the exercise of Lessor's remedies with
         respect thereto, including all costs and expenses incurred in
         connection with the placing of the Premises in the condition required
         by Section 6 and Section 12 hereof.

                  d. No remedy referred to in this Section 23 is intended to be
         exclusive but each shall be cumulative and in addition to any other
         remedy referred to herein or otherwise available to Lessor at law or in
         equity; and the exercise or beginning of exercise by Lessor of any one
         or more of such remedies shall not preclude the simultaneous or later
         exercise by Lessor of any or all such other remedies. Lessor may
         exercise any other right or remedy which may be available to it under
         applicable law or proceed by appropriate court action to enforce the
         terms hereof or to recover damages for the breach hereof or to rescind
         this Lease. No express or implied waiver by Lessor of an Event of
         Default shall in any way be, or be construed to be, a waiver of any
         future or subsequent Event of Default.


                                       13
<PAGE>   14

                  e. Lessee hereby waives presentment, demand, protest or any
         notice, except as hereinabove provided in this Section 23 (to the
         extent permitted by applicable law) of any kind in connection with this
         Lease.

         24. Lessor's Right to Perform. If Lessee fails to make any payment
required to be made by it hereunder or fails to perform or comply with any of
its other agreements contained herein, Lessor may itself make such payment or
perform or comply with such agreement, and the amount of such payment and the
amount of the reasonable expenses of Lessor incurred in connection with such
payment or the performance of or compliance with such agreement, as the case may
be, together with interest thereon at the Late Charge Rate, shall be deemed to
be additional rent, payable by Lessee on demand.

         25. Location; Assignment or Sublease. LESSEE WILL NOT REMOVE THE
EQUIPMENT OR ANY OTHER PART OF THE PREMISES WITHOUT THE PRIOR WRITTEN CONSENT OF
LESSOR. THE EQUIPMENT AND PREMISES SHALL AT ALL TIMES BE IN THE SOLE POSSESSION
AND CONTROL OF LESSEE OR LESSEE'S AGENTS, AND LESSEE WILL NOT, WITHOUT THE PRIOR
WRITTEN CONSENT OF LESSOR, ASSIGN THIS LEASE OR ANY INTEREST HEREIN OR SUBLEASE
OR OTHERWISE TRANSFER ITS INTEREST IN ANY OF THE PREMISES, AND ANY ATTEMPTED
ASSIGNMENT, SUBLEASE OR OTHER TRANSFER BY LESSEE IN VIOLATION OF THESE
PROVISIONS SHALL BE VOID.

         26. Further Assurances. Lessee will, at its expense, promptly and duly
execute and deliver to Lessor such further documents and assurances and take
such further action as Lessor may from time to time request in order to more
effectively carry out the intent and purpose of this Lease and to establish and
protect the rights, interests and remedies created or intended to be created in
favor of Lessor hereunder, including, without limitation, the execution and
filing of Uniform Commercial Code financing statements in the jurisdictions in
which the Premises are located. To the extent permitted by applicable law,
Lessee hereby authorizes Lessor to file any such financing statements without
the signature of Lessee. Lessee will pay, or reimburse Lessor for, any and all
out-of-pocket, reasonable fees, costs and expenses of whatever kind or nature
incurred in connection with the creation of this Lease, with the recording or
filing of instruments and documents in public offices, payments or discharge of
any taxes or Liens upon or in respect of the Premises, premiums for insurance
with respect to the Premises and all other fees, costs and expenses in
connection with protecting, maintaining or preserving the Premises and Lessor's
interests therein, whether through judicial proceedings or otherwise, or in
connection with defending or prosecuting any actions, suits or proceedings
arising out of or related to the Premises; and all such amounts that are paid by
Lessor shall, until reimbursed by Lessee, constitute additional rent, payable by
Lessee on demand. Lessee will also provide such information as Lessor may
reasonably require from Lessee to enable Lessor to fulfill all of its tax filing
obligations.


                                       14
<PAGE>   15

         27. Notices. All notices, demands and other communications hereunder
shall be in writing, and shall be deemed to have been given or made when
deposited in the United States mail, first class postage prepaid, addressed as
follows or to such other address as any of the following persons may from time
to time designate in writing to the other persons listed below:

         Lessor:           Cherokee Nitrogen Company
                           16 South Pennsylvania Avenue
                           Oklahoma City, Oklahoma 73107
                           Attention:  President

                           With Copy To:

                           Cherokee Nitrogen Company
                           16 South Pennsylvania Avenue
                           Oklahoma City, Oklahoma 73107
                           Attention:  General Counsel

         Lessee:           El Dorado Chemical Company
                           16 South Pennsylvania Avenue
                           Oklahoma City, Oklahoma 73107
                           Attention:  President

                           With Copy To:

                           El Dorado Chemical Company
                           16 South Pennsylvania Avenue
                           Oklahoma City, Oklahoma 73107
                           Attention:  General Counsel

         28. Miscellaneous.

                  a. Any provision of this Lease which is prohibited or
         unenforceable in any jurisdiction shall, as to such jurisdiction, be
         ineffective to the extent of such prohibition or unenforceability
         without invalidating the remaining provisions hereof, and any such
         prohibition or unenforceability in any jurisdiction shall not
         invalidate or render unenforceable such provision in any other
         jurisdiction. To the extent permitted by applicable law, Lessee hereby
         waives any provision of law which renders any provision hereof
         prohibited or unenforceable in any respect.

                  b. No term or provision of this Lease may be changed, waived,
         discharged or terminated orally, but only by an instrument in writing
         signed by the party against which the enforcement of the change,
         waiver, discharge or termination is sought. No


                                       15
<PAGE>   16
          delay or failure on the part of Lessor to exercise any power or right
          hereunder shall operate as a waiver thereof, nor as an acquiescence in
          any default, nor shall any single or partial exercise of any power or
          right preclude any other or further exercise thereof, or the exercise
          of any other power or right.

                  c. Lessor may assign this Lease and all of Lessor's rights
         hereunder, including the right to receive all rental payments. After
         such assignment, Lessor shall not be Assignee's agent for any purpose.
         Lessee will settle all claims that it may have against Lessor, directly
         with Lessor, and not against Lessor's assignee, Lessor hereby agreeing
         to remain responsible therefor. Lessee on receiving notice of any such
         assignment shall abide thereby and make payment as may therein be
         directed.

                  d. Power of Attorney.

                           (i) Lessee hereby irrevocably constitutes and
                  appoints Lessor and any officer or agent thereof, with full
                  power of substitution, as its true and lawful attorney-in-fact
                  with fully revocable power and authority in the place and
                  stead of Lessee in the name of Lessee or in its own name, from
                  time to time in Lessor's discretion, for the purpose of
                  carrying out the terms of this Lease, to take any and all
                  appropriate action and to execute any and all documents and
                  instruments which may be necessary or desirable to accomplish
                  the purposes of this Lease. Lessee hereby ratifies all that
                  said attorney shall lawfully do or cause to be done by virtue
                  hereof. This power of attorney is a power coupled with an
                  interest and shall be irrevocable.

                           (ii) The powers conferred on Lessor hereunder are
                  solely to protect its interest in the Premises and the
                  proceeds thereof and shall not impose any duty upon it to
                  exercise any such powers. Lessor shall be accountable only for
                  amounts that it actually receives as a result of the exercise
                  of such powers and neither it nor any of its officers,
                  directors, employees or agents shall be responsible to Lessee
                  for any act or failure to act.

                  e. This Lease contains the full, final and exclusive statement
         of the agreement between Lessor and Lessee relating to the lease of the
         Premises.

                  f. This Lease shall constitute an agreement of lease, and
         nothing herein shall be construed as conveying to Lessee any right,
         title or interest in the Premises except as lessee only.

                  g. This Lease and the covenants and agreements contained
         herein shall be binding upon, and inure to the benefit of, Lessor and
         its successors and assigns and Lessee and, to the extent permitted by
         Section 25 hereof, its successors and assigns.


                                       16
<PAGE>   17

                  h. The headings of the sections are for convenience of
         reference only, are not a part of this Lease and shall not be deemed to
         affect the meaning or construction of any of the provisions hereof.

                  i. This Lease may be executed by the parties hereto on any
         number of separate counterparts, each of which when so executed and
         delivered shall be an original, but all such counterparts shall
         together constitute but one and the same instrument.

                  j. THIS LEASE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
         WITH THE LAWS OF THE STATE OF OKLAHOMA.

                  k. LESSOR AND LESSEE IN ANY LITIGATION RELATING TO OR IN
         CONNECTION WITH THIS LEASE IN WHICH THEY SHALL BE ADVERSE PARTIES,
         WAIVE TRIAL BY JURY.

                  l. This Lease shall be in recordable form and shall be filed,
         upon the execution hereof, at the expense of Lessee, in the real estate
         records in the County of Colbert, State of Alabama. In lieu thereof,
         the parties will, simultaneously with the execution of this Lease,
         execute counterparts of an instrument, in recordable form, which when
         completed, will constitute a short form or memorandum of this Lease.
         The short form or memorandum of this Lease will include, but not be
         limited to, a description of the Premises, Commencement Date and Lease
         Term, and such other terms and provisions satisfactory to both parties
         hereto. The short form lease or memorandum of this Lease will be filed
         at the expense of Lessee, in the real estate records in the County of
         Colbert, State of Alabama, where the Premises are located.

         IN WITNESS WHEREOF, Lessor and Lessee have each caused this Lease to be
duly executed as of the day and year first above written.

ATTEST:                                 CHEROKEE NITROGEN COMPANY



                                        By:
--------------------------------------      -----------------------------------
                             Secretary  Name:
                       ------                ----------------------------------
                                        Title:
                                              ---------------------------------


                                       17
<PAGE>   18

ATTEST:                                 EL DORADO CHEMICAL COMPANY



                                        By:
--------------------------------------      -----------------------------------
                             Secretary  Name:
                       ------                ----------------------------------
                                        Title:
                                              ---------------------------------


                                       18
<PAGE>   19


STATE OF OKLAHOMA          )
                           ) ss.
COUNTY OF CLEVELAND        )

         On this 2nd day of March, 2001, before me, the undersigned, a Notary
Public in and for the county and state aforesaid, personally appeared Tony M.
Shelby, to me known to be the identical person who signed the name of the maker
thereof to the within and foregoing instrument as Vice President of Cherokee
Nitrogen Company and acknowledged to me that he executed the same as his free
and voluntary act and deed of said company, for the purposes therein set forth.

         Given under my hand and seal the day and year last above written.


                                          ------------------------------------
                                                      Notary Public

My Commission Expires:


----------------------
         [SEAL]

STATE OF OKLAHOMA          )
                           ) ss.
COUNTY OF CLEVELAND        )

         On this 2nd day of March, 2001, before me, the undersigned, a Notary
Public in and for the county and state aforesaid, personally appeared James L.
Wewers, to me known to be the identical person who signed the name of the maker
thereof to the within and foregoing instrument as _____ President of El Dorado
Chemical Company and acknowledged to me that he executed the same as his free
and voluntary act and deed of said company, for the purposes therein set forth.

         Given under my hand and seal the day and year last above written.


                                          ------------------------------------
                                                      Notary Public

My Commission Expires:


----------------------
         [SEAL]



                                       19

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