UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒

Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Quarterly Period Ended

~~March 31,~~June 30, 2021

☐

Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ______ to ______

Commission File Number: 001-34025

INTREPID POTASH, INC.

(Exact Name of Registrant as Specified in its Charter)


Delaware			26-1501877
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
1001 17th Street, Suite 1050
Denver,
Colorado			80202
(Address of principal executive offices)			(Zip Code)

(303) 296-3006

(Registrant’s telephone number, including area code)


N/A
(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act

Title of each class

Trading symbol

Name of each exchange on which registered

Common Stock, par value $0.001 per share

IPI

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files.) Yes ☒No☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated filer

☒

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐


If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes

☐

☒

As of ~~April~~July 27, 2021, the registrant had outstanding ~~13,445,803~~13,453,960 shares of common stock, par value $0.001 per share.

Table of Contents

INTREPID POTASH, INC.

TABLE OF CONTENTS


						Page
			PART I - FINANCIAL INFORMATION			1
			ITEM 1. Condensed Consolidated Financial Statements (Unaudited)			1
			Condensed Consolidated Balance Sheets			1
			Condensed Consolidated Statements of Operations			2
			Condensed Consolidated Statements of Stockholders' Equity			3
			Condensed Consolidated Statements of Cash Flows			4
			Notes to Condensed Consolidated Financial Statements			6
			ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			20
			ITEM 3. Quantitative and Qualitative Disclosures About Market Risk			3642
			ITEM 4. Controls and Procedures			3642
			PART II - OTHER INFORMATION			3743
			ITEM 1. Legal Proceedings			3743
			ITEM 1A. Risk Factors			3844
			ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds			3945
			ITEM 3. Defaults Upon Senior Securities			3945
			ITEM 4. Mine Safety Disclosures			3945
			ITEM 5. Other Information			3945
			ITEM 6. Exhibits			4046
			Signatures			4147

Table of Contents

PART I - FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

INTREPID POTASH, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)


		March 31,		December 31,			June 30,		December 31,
		2021		2020			2021		2020
ASSETS	ASSETS					ASSETS
Cash and cash equivalents	Cash and cash equivalents	$	35,995	$	19,515	Cash and cash equivalents	$	53,250	$	19,515

Accounts receivable:	Accounts receivable:					Accounts receivable:
Trade, net	Trade, net	36,898		22,795		Trade, net	23,029		22,795
Other receivables, net	Other receivables, net	2,298		1,577		Other receivables, net	2,470		1,577

Inventory, net	Inventory, net	78,919		88,673		Inventory, net	74,760		88,673
Prepaid expenses and other current assets	Prepaid expenses and other current assets	2,906		3,228		Prepaid expenses and other current assets	2,854		3,228
Total current assets	Total current assets	157,016		135,788		Total current assets	156,363		135,788

Property, plant, equipment, and mineral properties, net	Property, plant, equipment, and mineral properties, net	348,945		355,497		Property, plant, equipment, and mineral properties, net	341,984		355,497

Water rights	Water rights	19,184		19,184		Water rights	19,184		19,184
Long-term parts inventory, net	Long-term parts inventory, net	29,359		28,900		Long-term parts inventory, net	29,044		28,900

Other assets, net	Other assets, net	10,676		10,819		Other assets, net	10,545		10,819

Total Assets	Total Assets	$	565,180	$	550,188	Total Assets	$	557,120	$	550,188
LIABILITIES AND STOCKHOLDERS' EQUITY	LIABILITIES AND STOCKHOLDERS' EQUITY					LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable	Accounts payable	$	13,648	$	7,278	Accounts payable	$	7,206	$	7,278

Accrued liabilities	Accrued liabilities	13,080		12,701		Accrued liabilities	15,015		12,701
Accrued employee compensation and benefits	Accrued employee compensation and benefits	5,928		4,422		Accrued employee compensation and benefits	8,664		4,422

Current portion of long-term debt, net	Current portion of long-term debt, net	10,000		10,000		Current portion of long-term debt, net	0		10,000
Other current liabilities	Other current liabilities	36,264		32,816		Other current liabilities	34,812		32,816
Total current liabilities	Total current liabilities	78,920		67,217		Total current liabilities	65,697		67,217

Advances on credit facility	Advances on credit facility	29,817		29,817		Advances on credit facility	29,817		29,817
Long-term debt, net	Long-term debt, net	14,912		14,926		Long-term debt, net	0		14,926
Asset retirement obligation	Asset retirement obligation	24,313		23,872		Asset retirement obligation	24,780		23,872
Operating lease liabilities	Operating lease liabilities	1,851		2,136		Operating lease liabilities	1,413		2,136
Other non-current liabilities	Other non-current liabilities	928		961		Other non-current liabilities	878		961
Total Liabilities	Total Liabilities	150,741		138,929		Total Liabilities	122,585		138,929
Commitments and Contingencies	Commitments and Contingencies	0		0		Commitments and Contingencies	0		0
Common stock, 0.001 par value; 40,000,000 shares authorized;	Common stock, 0.001 par value; 40,000,000 shares authorized;					Common stock, 0.001 par value; 40,000,000 shares authorized;
13,065,654 and 13,049,820 shares outstanding
at March 31, 2021, and December 31, 2020, respectively		13		13
13,121,087 and 13,049,820 shares outstanding						13,121,087 and 13,049,820 shares outstanding
at June 30, 2021, and December 31, 2020, respectively						at June 30, 2021, and December 31, 2020, respectively	13		13
Additional paid-in capital	Additional paid-in capital	657,566		656,837		Additional paid-in capital	658,163		656,837

Accumulated deficit	Accumulated deficit	(243,140)		(245,591)		Accumulated deficit	(223,641)		(245,591)
Total Stockholders' Equity	Total Stockholders' Equity	414,439		411,259		Total Stockholders' Equity	434,535		411,259
Total Liabilities and Stockholders' Equity	Total Liabilities and Stockholders' Equity	$	565,180	$	550,188	Total Liabilities and Stockholders' Equity	$	557,120	$	550,188

See accompanying notes to these condensed consolidated financial statements.

Table of Contents

INTREPID POTASH, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)


		Three Months Ended March 31,				Three Months Ended June 30,				Six Months Ended June 30,
		2021		2020				2021		2020		2021		2020
Sales	Sales	$	71,463	$	63,984		Sales	$	67,888	$	46,450	$	139,351	$	110,434
Less:	Less:						Less:
Freight costs	Freight costs	12,078		11,860			Freight costs	10,115		8,735		22,193		20,595
Warehousing and handling costs	Warehousing and handling costs	2,632		2,904			Warehousing and handling costs	2,378		2,065		5,010		4,969
Cost of goods sold	Cost of goods sold	47,645		43,047			Cost of goods sold	41,196		34,008		88,841		77,055
Lower of cost or net realizable value inventory adjustments	Lower of cost or net realizable value inventory adjustments	0		550			Lower of cost or net realizable value inventory adjustments	0		2,241		0		2,791

Gross Margin		9,108		5,623
Gross Margin (Deficit)							Gross Margin (Deficit)	14,199		(599)		23,307		5,024

Selling and administrative	Selling and administrative	5,791		6,599			Selling and administrative	6,612		6,673		12,403		13,272
Accretion of asset retirement obligation	Accretion of asset retirement obligation	441		435			Accretion of asset retirement obligation	441		434		882		869

Litigation settlement	Litigation settlement	0		10,075			Litigation settlement	0		0		0		10,075
Loss (gain) on sale of assets		2		(4,696)
Other operating expense (income)		6		(11)
(Gain) loss on sale of assets							(Gain) loss on sale of assets	(2,567)		234		(2,565)		(4,462)
Other operating (income) expense							Other operating (income) expense	(583)		269		(577)		258
Operating Income (Loss)	Operating Income (Loss)	2,868		(6,779)			Operating Income (Loss)	10,296		(8,209)		13,164		(14,988)

Other Income (Expense)	Other Income (Expense)						Other Income (Expense)
Interest expense, net	Interest expense, net	(426)		(792)			Interest expense, net	(918)		(635)		(1,344)		(1,427)
Interest income	Interest income	0		116			Interest income	0		0		—		116
Other income	Other income	9		16			Other income	8		(28)		17		(12)
Gain on extinguishment of debt							Gain on extinguishment of debt	10,113		0		10,113		0

Income (Loss) Before Income Taxes	Income (Loss) Before Income Taxes	2,451		(7,439)			Income (Loss) Before Income Taxes	19,499		(8,872)		21,950		(16,311)

Income Tax Benefit	Income Tax Benefit	0		42			Income Tax Benefit	0		0		0		42
Net Income (Loss)	Net Income (Loss)	$	2,451	$	(7,397)		Net Income (Loss)	$	19,499	$	(8,872)	$	21,950	$	(16,269)

Weighted Average Shares Outstanding:	Weighted Average Shares Outstanding:						Weighted Average Shares Outstanding:
Basic	Basic	13,054		12,957			Basic	13,089		12,979		13,071		12,968
Diluted	Diluted	13,297		12,957			Diluted	13,338		12,979		13,335		12,968
Earnings Per Share:	Earnings Per Share:						Earnings Per Share:
Basic	Basic	$	0.19	$	(0.57)		Basic	$	1.49	$	(0.68)	$	1.68	$	(1.25)
Diluted	Diluted	$	0.18	$	(0.57)		Diluted	$	1.46	$	(0.68)	$	1.65	$	(1.25)

See accompanying notes to these condensed consolidated financial statements.

Table of Contents

INTREPID POTASH, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(In thousands, except share amounts)

Three-Month Period Ended March 31, 2021
Common Stock Additional Paid-in Capital Accumulated Deficit Total Stockholders' Equity
Shares Amount
Balance, December 31, 2020 13,049,820 $ 13 $ 656,837 $ (245,591) $ 411,259
Net income — — — 2,451 2,451
Stock-based compensation — — 890 — 890
Exercise of stock options 4,188 — 43 — 43
Vesting of restricted common stock, net of common stock used to fund employee income tax withholding due upon vesting 11,646 — (204) — (204)
Balance, March 31, 2021 13,065,654 $ 13 $ 657,566 $ (243,140) $ 414,439
Three-Month Period Ended March 31, 2020
Common Stock Additional Paid-in Capital Accumulated Deficit Total Stockholders' Equity
Shares Amount
Balance, December 31, 2019 12,955,351 $ 13 $ 653,080 $ (218,437) $ 434,656
Net loss — — — (7,397) (7,397)
Stock-based compensation — — 1,032 — 1,032
Vesting of restricted common stock, net of common stock used to fund employee income tax withholding due upon vesting 8,999 — (49) — (49)
Balance, March 31, 2020 12,964,350 $ 13 $ 654,063 $ (225,834) $ 428,242


	Six-Month Period Ended June 30, 2021
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
Balance, December 31, 2020	13,049,820	$	13	$	656,837	$	(245,591)	$	411,259



Net income	—	—		—		21,950		21,950
Stock-based compensation	—	—		1,655		—		1,655
Exercise of stock options	4,913	—		51		—		51
Vesting of restricted common stock, net of common stock used to fund employee income tax withholding due upon vesting	66,354	—		(380)		—		(380)
Balance, June 30, 2021	13,121,087	$	13	$	658,163	$	(223,641)	$	434,535

	Three-Month Period Ended June 30, 2021
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
Balance, March 31, 2021	13,065,654	$	13	$	657,566	$	(243,140)	$	414,439



Net income	—	—		—		19,499		19,499
Stock-based compensation	—	—		765		—		765
Exercise of stock options	725	—		7		—		7
Vesting of restricted common stock, net of common stock used to fund employee income tax withholding due upon vesting	54,708	—		(175)		—		(175)
Balance, June 30, 2021	13,121,087	$	13	$	658,163	$	(223,641)	$	434,535

	Six-Month Period Ended June 30, 2020
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
Balance, December 31, 2019	12,955,351	$	13	$	653,080	$	(218,437)	$	434,656



Net loss	—	—		—		(16,269)		(16,269)
Stock-based compensation	—	—		1,995		—		1,995
Vesting of restricted common stock, net of common stock used to fund employee income tax withholding due upon vesting	50,773	—		(174)		—		(174)

Balance, June 30, 2020	13,006,124	$	13	$	654,901	$	(234,706)	$	420,208

	Three-Month Period Ended June 30, 2020
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
Balance, March 31, 2020	12,964,350	$	13	$	654,063	$	(225,834)	$	428,242



Net loss	—	—		—		(8,872)		(8,872)
Stock-based compensation	—	—		965		—		965

Vesting of restricted common stock, net of common stock used to fund employee income tax withholding due upon vesting	41,774	—		(127)		—		(127)
Balance, June 30, 2020	13,006,124	$	13	$	654,901	$	(234,706)	$	420,208

See accompanying notes to these condensed consolidated financial statements.

Table of Contents


INTREPID POTASH, INC.	INTREPID POTASH, INC.					INTREPID POTASH, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS	CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS					CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)	(In thousands)					(In thousands)
		Three Months Ended March 31,					Six Months Ended June 30,
		2021		2020			2021		2020
Cash Flows from Operating Activities:	Cash Flows from Operating Activities:					Cash Flows from Operating Activities:
Net income (loss)	Net income (loss)	$	2,451	$	(7,397)	Net income (loss)	$	21,950	$	(16,269)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:	Adjustments to reconcile net income (loss) to net cash provided by operating activities:					Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation, depletion and amortization	Depreciation, depletion and amortization	9,481		9,586		Depreciation, depletion and amortization	18,079		17,629
Accretion of asset retirement obligation	Accretion of asset retirement obligation	441		435		Accretion of asset retirement obligation	882		869
Amortization of deferred financing costs	Amortization of deferred financing costs	68		86		Amortization of deferred financing costs	194		161
Amortization of intangible assets	Amortization of intangible assets	80		80		Amortization of intangible assets	161		161
Stock-based compensation	Stock-based compensation	890		1,032		Stock-based compensation	1,655		1,995
Lower of cost or net realizable value inventory adjustments	Lower of cost or net realizable value inventory adjustments	0		550		Lower of cost or net realizable value inventory adjustments	0		2,791
Accrual for litigation settlement		0		10,075
Loss (gain) on disposal of assets		2		(4,696)

(Gain) loss on disposal of assets						(Gain) loss on disposal of assets	(2,565)		(4,462)

Gain on extinguishment of debt						Gain on extinguishment of debt	(10,113)		0
Allowance for doubtful accounts	Allowance for doubtful accounts	0		275		Allowance for doubtful accounts	0		275

Allowance for parts inventory obsolescence						Allowance for parts inventory obsolescence	0		492
Other						Other	0		(116)
Changes in operating assets and liabilities:	Changes in operating assets and liabilities:					Changes in operating assets and liabilities:
Trade accounts receivable, net	Trade accounts receivable, net	(14,103)		(8,388)		Trade accounts receivable, net	(235)		4,218
Other receivables, net	Other receivables, net	(720)		(308)		Other receivables, net	(893)		(735)

Inventory, net	Inventory, net	9,293		4,976		Inventory, net	13,767		8,861
Prepaid expenses and other current assets	Prepaid expenses and other current assets	358		857		Prepaid expenses and other current assets	495		1,430
Accounts payable, accrued liabilities, and accrued employee compensation and benefits	Accounts payable, accrued liabilities, and accrued employee compensation and benefits	7,978		8,119		Accounts payable, accrued liabilities, and accrued employee compensation and benefits	6,023		1,528

Operating lease liabilities	Operating lease liabilities	(525)		(552)		Operating lease liabilities	(1,061)		(1,050)
Other liabilities	Other liabilities	3,415		41		Other liabilities	3,097		5,770
Net cash provided by operating activities	Net cash provided by operating activities	19,109		14,771		Net cash provided by operating activities	51,436		23,548

Cash Flows from Investing Activities:	Cash Flows from Investing Activities:					Cash Flows from Investing Activities:
Additions to property, plant, equipment, mineral properties and other assets	Additions to property, plant, equipment, mineral properties and other assets	(2,360)		(5,710)		Additions to property, plant, equipment, mineral properties and other assets	(6,626)		(10,645)

Long-term investment						Long-term investment	0		(3,500)
Proceeds from sale of assets	Proceeds from sale of assets	47		4,786		Proceeds from sale of assets	6,042		4,786

Net cash used in investing activities	Net cash used in investing activities	(2,313)		(924)		Net cash used in investing activities	(584)		(9,359)

Cash Flows from Financing Activities:
Debt prepayment costs		(2)		0
Repayments of long-term debt		(22)		0
Proceeds from short-term borrowings on credit facility		0		10,000

Payments of financing lease		(107)		0
Capitalized debt fees		0		0
Employee tax withholding paid for restricted stock upon vesting		(204)		(49)

Proceeds from exercise of stock options		43		—
Net cash (used in) provided by financing activities		(292)		9,951

Net Change in Cash, Cash Equivalents and Restricted Cash		16,504		23,798
Cash, Cash Equivalents and Restricted Cash, beginning of period		20,184		21,239
Cash, Cash Equivalents and Restricted Cash, end of period		$	36,688	$	45,037

Table of Contents


INTREPID POTASH, INC.	INTREPID POTASH, INC.					INTREPID POTASH, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS	CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS					CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)	(In thousands)					(In thousands)
		Three Months Ended March 31,					Six Months Ended June 30,
		2021		2020			2021		2020
Cash Flows from Financing Activities:						Cash Flows from Financing Activities:
Debt prepayment costs						Debt prepayment costs	(505)		0
Repayments of long-term debt						Repayments of long-term debt	(15,000)		(20,000)
Proceeds from short-term borrowings on credit facility						Proceeds from short-term borrowings on credit facility	0		10,000

Payments of financing lease						Payments of financing lease	(1,258)		0
Capitalized debt fees						Capitalized debt fees	0		(36)
Employee tax withholding paid for restricted stock upon vesting						Employee tax withholding paid for restricted stock upon vesting	(380)		(174)
Proceeds from loan under CARES Act						Proceeds from loan under CARES Act	0		10,000
Proceeds from exercise of stock options						Proceeds from exercise of stock options	51		—
Net cash used in financing activities						Net cash used in financing activities	(17,092)		(210)

Net Change in Cash, Cash Equivalents and Restricted Cash						Net Change in Cash, Cash Equivalents and Restricted Cash	33,760		13,979
Cash, Cash Equivalents and Restricted Cash, beginning of period						Cash, Cash Equivalents and Restricted Cash, beginning of period	20,184		21,239
Cash, Cash Equivalents and Restricted Cash, end of period						Cash, Cash Equivalents and Restricted Cash, end of period	$	53,944	$	35,218

Supplemental disclosure of cash flow information	Supplemental disclosure of cash flow information					Supplemental disclosure of cash flow information
Net cash paid during the period for:	Net cash paid during the period for:					Net cash paid during the period for:
Interest	Interest	$	167	$	227	Interest	$	777	$	1,644
Income taxes	Income taxes	$	8	$	0	Income taxes	$	91	$	1
Amounts included in the measurement of operating lease liabilities	Amounts included in the measurement of operating lease liabilities	$	583	$	637	Amounts included in the measurement of operating lease liabilities	$	1,169	$	1,267
Accrued purchases for property, plant, equipment, and mineral properties	Accrued purchases for property, plant, equipment, and mineral properties	$	622	$	2,557	Accrued purchases for property, plant, equipment, and mineral properties	$	1,420	$	1,830
Right-of-use assets exchanged for operating lease liabilities	Right-of-use assets exchanged for operating lease liabilities	$	340	$	104	Right-of-use assets exchanged for operating lease liabilities	$	340	$	104

See accompanying notes to these condensed consolidated financial statements.

Table of Contents

INTREPID POTASH, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 1— COMPANY BACKGROUND

We are a diversified mineral company that delivers potassium, magnesium, sulfur, salt, and water products essential for customer success in agriculture, animal feed and the oil and gas industry. We are the only U.S. producer of muriate of potash (sometimes referred to as potassium chloride or potash), which is applied as an essential nutrient for healthy crop development, utilized in several industrial applications, and used as an ingredient in animal feed. In addition, we produce a specialty fertilizer, Trio®, which delivers three key nutrients, potassium, magnesium, and sulfate, in a single particle. We also provide water, magnesium chloride, brine and various oilfield products and services.

Our extraction and production operations are conducted entirely in the continental United States. We produce potash from 3 solution mining facilities: our HB solution mine in Carlsbad, New Mexico, our solution mine in Moab, Utah, and our brine recovery mine in Wendover, Utah. We also operate the North compaction facility in Carlsbad, New Mexico, which compacts and granulates product from the HB mine. We produce Trio® from our conventional underground East mine in Carlsbad, New Mexico.

We have water rights in New Mexico ~~under which~~to support our mining and industrial operations. Water we do not use to support our mining and industrial operations we sell ~~water~~ primarily to support oil and gas development in the Permian Basin near our Carlsbad facilities. We continue to work to expand our sales of water. In May 2019, we acquired certain land, water rights, state grazing leases for cattle, and other related assets from Dinwiddie Cattle Company. We refer to these assets and operations as "Intrepid South." Due to the strategic location of Intrepid South, part of our long-term operating strategy is selling small parcels of land, including restricted use agreements of surface or subsurface rights, to customers, where such sales provide a solution to asuch customer's operations in the oil and gas industry.

We have 3 segments: potash, Trio®, and oilfield solutions. We account for sales of byproducts as revenue in the potash or Trio® segment based on which segment generates the byproduct. Intersegment sales prices are market based and are eliminated.

"Intrepid," "our," "we," or "us," means Intrepid Potash, Inc. and its consolidated subsidiaries.

Note 2— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Financial Statement Presentation—Our unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") have been condensed or omitted pursuant to those rules and regulations. In the opinion of management, all adjustments, consisting of normal recurring accruals considered necessary for a fair presentation of interim financial information, have been included. These unaudited condensed consolidated financial statements should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2020.

Reverse Stock Split—On August 10, 2020, after receipt of stockholder approval, the Board of Directors approved an amendment to our Certificate of Incorporation to effect a reverse stock split of our common stock, par value $0.001 per share, by a ratio of one-for-10. The reverse stock split became effective August 14, 2020. Additionally, the total number of authorized shares of our common stock was reduced to 40,000,000 shares. Unless otherwise indicated, all share amounts, per share data, share prices, exercise prices and conversion rates set forth in these notes and the accompanying condensed consolidated financial statements have, where applicable, been adjusted retroactively to reflect this reverse stock split.

Recently Adopted Accounting Standards

In December 2019, the FASB issued ASU 2019-12, ~~"Income~~Income Taxes ~~("Topic 740")~~(Topic 740): Simplifying the Accounting for Income Taxes", which simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and amending existing guidance to improve consistent application. Most amendments within this standard were required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. We adopted this standard on January 1, 2021. The effect of the adoption of this standard was immaterial on our condensed consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - (Topic 326): Measurement of Credit Losses on Financial Instruments, which we adopted on January 1, 2020. ASU No. 2016-13 changes the way entities

Table of Contents

recognize impairment of many financial assets by requiring immediate recognition of estimated credit losses expected to

~~Table of Contents~~

occur over their remaining life and required a cumulative-effect adjustment to the statement of financial position on January 1, 2020. The effect of the adoption of this standard was immaterial on our condensed consolidated financial statements.

Reclassifications of Prior Period Presentation—Certain prior period amounts have been reclassified in order to conform to the current period presentation. These reclassifications had no effect on the reported results of operations.

Note 3— EARNINGS PER SHARE

Basic earnings per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period. For purposes of determining diluted earnings per share, basic weighted-average common shares outstanding is adjusted to include potentially dilutive securities, including restricted stock, stock options, and performance units. The treasury-stock method is used to measure the dilutive impact of potentially dilutive shares. Potentially dilutive shares are excluded from the diluted weighted-average shares outstanding computation in periods in which they have an anti-dilutive effect. The following table shows the calculation of basic and diluted earnings per share (in thousands, except per share amounts):


		Three Months Ended March 31,				Three Months Ended June 30,				Six Months Ended June 30,
		2021		2020				2021		2020		2021		2020
Net income (loss)	Net income (loss)	$	2,451	$	(7,397)		Net income (loss)	$	19,499	$	(8,872)	$	21,950	$	(16,269)

Basic weighted-average common shares outstanding	Basic weighted-average common shares outstanding	13,054		12,957			Basic weighted-average common shares outstanding	13,089		12,979		13,071		12,968
Add: Dilutive effect of restricted stock	Add: Dilutive effect of restricted stock	177		0			Add: Dilutive effect of restricted stock	185		0		199		0
Add: Dilutive effect of stock options	Add: Dilutive effect of stock options	66		0			Add: Dilutive effect of stock options	64		0		65		0

Diluted weighted-average common shares outstanding	Diluted weighted-average common shares outstanding	13,297		12,957			Diluted weighted-average common shares outstanding	13,338		12,979		13,335		12,968

Basic	Basic	$	0.19	$	(0.57)		Basic	$	1.49	$	(0.68)	$	1.68	$	(1.25)
Diluted	Diluted	$	0.18	$	(0.57)		Diluted	$	1.46	$	(0.68)	$	1.65	$	(1.25)

The following table shows the shares that have an anti-dilutive effect and are excluded from the diluted weighted-average shares outstanding computations (in thousands):


		Three Months Ended March 31,		Three Months Ended June 30,			Six Months Ended June 30,
		2021	2020			2021	2020	2021	2020
Anti-dilutive effect of restricted stock	Anti-dilutive effect of restricted stock	64	312		Anti-dilutive effect of restricted stock	96	193	80	184

Anti-dilutive effect of stock options outstanding	Anti-dilutive effect of stock options outstanding	158	312		Anti-dilutive effect of stock options outstanding	62	311	100	312

Table of Contents

Note 4— CASH, CASH EQUIVALENTS AND RESTRICTED CASH

Total cash, cash equivalents and restricted cash, as shown on the condensed consolidated statements of cash flows are included in the following accounts at ~~March 31,~~June 30, 2021, and 2020 (in thousands):


		March 31, 2021		March 31, 2020			June 30, 2021		June 30, 2020
Cash and cash equivalents	Cash and cash equivalents	$	35,995	$	44,371	Cash and cash equivalents	$	53,250	$	34,552
Restricted cash included in other current assets	Restricted cash included in other current assets	175		150		Restricted cash included in other current assets	175		150
Restricted cash included in other long-term assets	Restricted cash included in other long-term assets	518		516		Restricted cash included in other long-term assets	519		516
Total cash, cash equivalents, and restricted cash as shown in the statement of cash flows	Total cash, cash equivalents, and restricted cash as shown in the statement of cash flows	$	36,688	$	45,037	Total cash, cash equivalents, and restricted cash as shown in the statement of cash flows	$	53,944	$	35,218

Restricted cash included in other current and long-term assets on the condensed consolidated balance sheets represents amounts whose use is restricted by contractual agreements with various entities, principally the Bureau of Land Management or the State of Utah, as security to fund future reclamation obligations at our sites.

Note 5— INVENTORY AND LONG-TERM PARTS INVENTORY

The following summarizes our inventory, recorded at the lower of weighted-average cost or estimated net realizable value, as of ~~March 31,~~June 30, 2021, and December 31, 2020 (in thousands):


		March 31, 2021		December 31, 2020			June 30, 2021		December 31, 2020
Finished goods product inventory	Finished goods product inventory	$	46,166	$	48,961	Finished goods product inventory	$	33,968	$	48,961
In-process inventory	In-process inventory	21,775		28,833		In-process inventory	29,860		28,833
Total product inventory	Total product inventory	67,941		77,794		Total product inventory	63,828		77,794
Current parts inventory, net	Current parts inventory, net	10,978		10,879		Current parts inventory, net	10,932		10,879
Total current inventory, net	Total current inventory, net	78,919		88,673		Total current inventory, net	74,760		88,673
Long-term parts inventory, net	Long-term parts inventory, net	29,359		28,900		Long-term parts inventory, net	29,044		28,900
Total inventory, net	Total inventory, net	$	108,278	$	117,573	Total inventory, net	$	103,804	$	117,573

Parts inventory is shown net of estimated allowances for obsolescence of $1.1 million as of ~~March 31,~~June 30, 2021, and December 31, 2020, respectively.

As a result of routine assessments of the lower of weighted-average cost or estimated net realizable value of our finished goods product inventory, we recorded inventory charges of 0$2.2 million and ~~$0.6~~$2.8 million for the three and six months ended ~~March 31, 2021~~June 30, 2020, respectively. We recorded 0 inventory charges during the three and ~~2020, respectively.~~six months ended June 30, 2021.

Table of Contents

Note 6 — PROPERTY, PLANT, EQUIPMENT, AND MINERAL PROPERTIES

Property, plant, equipment, and mineral properties were comprised of the following (in thousands):


		March 31, 2021		December 31, 2020			June 30, 2021		December 31, 2020
Land	Land	$	27,263	$	27,263	Land	$	24,136	$	27,263
Ponds and land improvements	Ponds and land improvements	68,171		67,843		Ponds and land improvements	68,215		67,843
Mineral properties and development costs	Mineral properties and development costs	144,043		143,955		Mineral properties and development costs	144,093		143,955
Buildings and plant	Buildings and plant	81,842		81,692		Buildings and plant	82,457		81,692
Machinery and equipment	Machinery and equipment	265,716		265,121		Machinery and equipment	268,346		265,121
Vehicles	Vehicles	6,024		5,919		Vehicles	6,281		5,919
Office equipment and improvements	Office equipment and improvements	9,111		9,083		Office equipment and improvements	9,113		9,083
Operating lease ROU assets	Operating lease ROU assets	9,961		9,622		Operating lease ROU assets	8,629		9,622
Breeding stock	Breeding stock	254		260		Breeding stock	275		260
Construction in progress	Construction in progress	2,466		1,710		Construction in progress	4,314		1,710
Total property, plant, equipment, and mineral properties, gross	Total property, plant, equipment, and mineral properties, gross	$	614,851	$	612,468	Total property, plant, equipment, and mineral properties, gross	$	615,859	$	612,468
Less: accumulated depreciation, depletion, and amortization	Less: accumulated depreciation, depletion, and amortization	(265,906)		(256,971)		Less: accumulated depreciation, depletion, and amortization	(273,875)		(256,971)
Total property, plant, equipment, and mineral properties, net	Total property, plant, equipment, and mineral properties, net	$	348,945	$	355,497	Total property, plant, equipment, and mineral properties, net	$	341,984	$	355,497

In May 2021, we sold approximately 330 acres of land we owned in Texas for $6.0 million and recorded a gain of $2.8 million. In March 2020, we sold approximately 320 acres of land for $4.8 ~~million. In connection with that sale, we~~million and recorded a gain of $4.7 million.

We incurred the following expenses for depreciation, depletion, and amortization, including expenses capitalized into inventory, for the following periods (in thousands):


		Three Months Ended March 31,				Three Months Ended June 30,				Six Months Ended June 30,
		2021		2020				2021		2020		2021		2020
Depreciation	Depreciation	$	7,495	$	7,291		Depreciation	$	7,356	$	7,363	$	14,851	$	14,654
Depletion	Depletion	1,475		1,752			Depletion	721		136		2,196		1,888
Amortization of right of use assets	Amortization of right of use assets	511		543			Amortization of right of use assets	521		544		1,032		1,087
Total incurred	Total incurred	$	9,481	$	9,586		Total incurred	$	8,598	$	8,043	$	18,079	$	17,629

Note 7 — DEBT

~~Senior Notes—As of March 31, 2021, we had outstanding $15.0 million of Series B Senior Notes, due on April 14, 2023.~~

In April 2020, we repaid our Series A Senior Notes ($20 million) at maturity. In July 2020, we repaid our Series C Senior Notes. As part of our Series C Senior Notes, we repaid the full $15 million of principal along with a reduced make-whole payment of $1.9 million.

~~The agreement governing the Series B Senior Notes contains certain financial covenants, including the following:~~

•We are required to maintain a minimum fixed charge coverage ratio of 1.3 to 1.0 as of the last day of each quarter, measured based on the previous four quarters. Our fixed charge coverage ratio as of March 31, 2021, was 7.5 to 1.0.

•~~We are allowed a maximum leverage ratio of 3.5 to 1.0 as of the last day of each quarter, measured based on the previous four quarters. Our leverage ratio as of March 31, 2021, was 2.0 to 1.0.~~

Fixed charge coverage ratio and leverage ratio are calculated in accordance with the agreement governing the Series B Notes, each of which includes earnings before interest, taxes, depreciation and amortization as a component. As of March 31, 2021, we were in compliance with all applicable covenants under the Series B Senior Notes.

For the three months ended March 31, 2021, the interest rate on the Series B Senior Notes was 4.63%, which represents the lowest interest rate available under the Series B Senior Notes. The interest rates may adjust upward if we do not continue to meet certain financial covenants.

~~Table of Contents~~

We have granted to the collateral agent for the Series B Senior Notes a first lien on substantially all of our non-current assets and a second lien on substantially all of our current assets. We are required to offer to prepay the Series B Senior Notes with the proceeds of dispositions of certain specified property and with the proceeds of certain equity issuances, as set forth in the agreement governing the Series B Senior Notes. The obligations under the Senior B Notes are unconditionally guaranteed by several of our subsidiaries.

In April 2020, we amended the agreement governing the Series B Senior Notes to allow for a $10 million loan under the Paycheck Protection Program under the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"), as described further below.

~~Our outstanding long-term debt, net, as of March 31, 2021, and December 31, 2020, was as follows (in thousands):~~

March 31, 2021 December 31, 2020
Notes and Payroll Protection Loan $ 24,978 $ 25,000
Less current portion of long-term debt (10,000) (10,000)
Less deferred financing costs (66) (74)
Long-term debt, net $ 14,912 $ 14,926

Credit Facility—We maintain a revolving credit facility with Bank of Montreal. As of ~~March 31,~~June 30, 2021, borrowings under the credit facility bear interest at LIBOR (London Interbank Offered Rate) plus an applicable margin of 1.25% to 2.00% per annum, based on our leverage ratio as calculated in accordance with the agreement governing the credit facility. We have granted to Bank of Montreal a first lien on substantially all of our current ~~assets~~ and ~~a second lien on substantially all of our~~ non-current assets. The obligations under the credit facility are unconditionally guaranteed by several of our subsidiaries.

The agreement governing our revolving credit facility contains certain financial covenants, including the following:

•We are allowed a maximum leverage ratio of 3.25 to 1.0, calculated as of the last day of each quarter by dividing the difference between total debt outstanding less unrestricted cash by consolidated earnings before interest, taxes, depreciation, and amortization ("Consolidated EBITDA") for the previous four quarters. Because our unrestricted cash balance was greater than our outstanding debt balance, our leverage ratio as of June 30, 2021, was 0.

•We are required to maintain a fixed charge coverage ratio of 1.2 to 1.0 as of the last day of each quarter, calculated by dividing the difference of Consolidated EBITDA for the previous four quarters less a fixed capital expenditures amount of $15 million and less cash taxes paid during the previous four quarters by interest expense for the previous four quarters. As of June 30, 2021, our fixed charge coverage ratio was 16.9 to 1.0.

Table of Contents

and $1 million in outstanding letters of credit under the facility. Including the outstanding letters of credit, we had ~~$35.0~~$44.2 million available to be borrowed under the facility as of ~~March 31,~~June 30, 2021.

As of ~~March 31,~~June 30, 2021, we were in compliance with all applicable covenants under the revolving credit facility.

During the ~~three~~six months ended ~~March 31,~~June 30, 2020, we borrowed $10 million under the facility and made 0 repayments.

~~Table of Contents~~

PPP Loan—In April 2020, we received a $10 million loan under the Paycheck Protection Program (the "PPP") under the CARES Act. The loan matures in April 2022 and bears interest at a rate of 1% per annum. We were required to begin monthly payments of principal and interest in the amount of $0.6 million in November 2020, but due to extensions of the program and delays in the forgiveness application process, we do not expect to make any payments on the loan until a decision is made on our forgiveness application. We may prepay the loan at any time prior to maturity with no prepayment penalties. We used the funds exclusively for allowed payroll and benefits expenses and expect the majority of the loan, if not all, will be forgiven. The loan contains customary events of default relating to, among other things, payment defaults, making materially false and misleading representations to the lender or breaching the terms of the loan documents.

During the second quarter of 2020, the PPP was amended to allow borrowers to choose either an eight-week or 24-week period to use the funds. We elected to use the 24-week period, which ended in October 2020. The amount eligible for forgiveness is based on the amount of loan proceeds used by us (during the 24-week period after the lender makes the first disbursement of loan proceeds) for the payment of certain covered costs, including payroll costs (including benefits), subject to certain limitations and reductions in accordance with the CARES Act. We submitted our application for forgiveness of the full ~~$10 million~~amount of the loan in November 2020. ~~No assurance can be given~~In June 2021, we received notice that the Small Business Administration had remitted funds to our bank to fully repay our PPP loan and accrued interest. Accordingly, we ~~will obtain~~recognized a gain of $10.1 million related to the forgiveness of the PPP loan ~~in whole or in part.~~ and the associated accrued interest on the loan.

Senior Notes—In ~~addition, as a borrower that received over $2.0~~June 2021 we repaid the remaining $15.0 million ~~we expect to be subject to an audit to review~~of principal outstanding on our ~~eligibility~~Series B Senior Notes due April 14, 2023 (the "Series B Senior Notes") and satisfied all obligations under the ~~PPP. The timing~~Amended and ~~scope~~Restated Note Purchase Agreement, dated as of October 31, 2016, by and among the Company and each of the ~~audit remains unclear~~purchasers named therein (as amended, the "Note Purchase Agreement"). In connection with this repayment, the Company paid in aggregate approximately $15.6 million, which consisted of (i) $15.0 million of remaining aggregate principal amount of Series B Senior Notes, (ii) approximately $0.1 million of accrued interest and as(iii) a "make-whole" premium of $0.5 million. As a result ~~we are not able to forecast when we can expect a decision on loan forgiveness. We do not expect~~of the ~~audit will impact our eligibility for forgiveness under~~repayment, the ~~PPP.~~Note Purchase Agreement was terminated.

Interest Expense—Interest expense is recorded net of any capitalized interest associated with investments in capital projects. We incurred gross interest expense of ~~$0.4~~$0.9 million and ~~$0.9~~$0.7 million for the three months ended ~~March 31,~~June 30, 2021, and 2020, respectively, and $1.4 million and $1.5 million for the six months ended June 30, 2021, and 2020, respectively.

Amounts included in interest expense, net for the three months ended ~~March 31,~~June 30, 2021, and 2020, were as follows (in thousands):


		Three Months Ended March 31,				Three Months Ended June 30,				Six Months Ended June 30,
		2021		2020				2021		2020		2021		2020
Interest on debt borrowings	Interest on debt borrowings	$	365	$	779		Interest on debt borrowings	$	302	$	584	$	667	$	1,363
Make-whole payments	Make-whole payments	2		0			Make-whole payments	503		0		505		0
Amortization of deferred financing costs	Amortization of deferred financing costs	68		86			Amortization of deferred financing costs	126		75		194		161
Gross interest expense	Gross interest expense	435		865			Gross interest expense	931		659		1,366		1,524
Less capitalized interest	Less capitalized interest	(9)		(73)			Less capitalized interest	(13)		(24)		(22)		(97)
Interest expense, net	Interest expense, net	$	426	$	792		Interest expense, net	$	918	$	635	$	1,344	$	1,427

1110

Table of Contents

Note 8 — INTANGIBLE ASSETS

We have water rights, recorded at $19.2 million at ~~March 31,~~June 30, 2021, and December 31, 2020. Our water rights have indefinite lives and are not amortized. We evaluate our water rights at least annually on October 1 for impairment, or more frequently if circumstances require.

We account for other intangible assets as finite-lived intangible assets and amortize those intangible assets over the period of estimated benefit, using the straight-line method. The weighted average amortization period for the other intangible assets is approximately 18 years. At ~~March 31,~~June 30, 2021, and December 31, 2020, these intangible assets had a net book value of $~~5.8~~5.7 million and $5.9 million, respectively, and are included in "Other assets, net" on the Condensed Consolidated Balance Sheets.

Note 9— FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS OF POSSIBLE FUTURE

PUBLIC DEBT

Intrepid Potash, Inc., as the parent company, has no independent assets or operations, and operations are conducted solely through its subsidiaries. Cash generated from operations is held at the parent-company level as cash on hand and totaled ~~$36.0~~$53.3 million and $19.5 million at ~~March 31,~~June 30, 2021, and December 31, 2020, respectively. If one or more of our wholly-owned operating subsidiaries guarantee public debt securities in the future, those guarantees will be full and unconditional and will constitute the joint and several obligations of the subsidiary guarantors. The assets and liabilities of our other subsidiaries are immaterial. There are no restrictions on our ability to obtain cash dividends or other distributions of funds from the subsidiary guarantors, except those imposed by applicable law.

1211

Table of Contents

Note 10 — ASSET RETIREMENT OBLIGATION

We recognize an estimated liability for future costs associated with the abandonment and reclamation of our mining properties. A liability for the fair value of an asset retirement obligation and a corresponding increase to the carrying value of the related long-lived asset are recorded as the mining operations occur or the assets are acquired.

Our asset retirement obligation is based on the estimated cost to abandon and reclaim the mining operations, the economic life of the properties, and federal and state regulatory requirements. The liability is discounted using credit adjusted risk-free rate estimates at the time the liability is incurred or when there are upward revisions to estimated costs. The credit adjusted risk-free rates used to discount our abandonment liabilities range from 6.9% to 9.7%. Revisions to the liability occur due to construction of new or expanded facilities, changes in estimated abandonment costs or economic lives, or if federal or state regulators enact new requirements regarding the abandonment or reclamation of mines.

Following is a table of the changes to our asset retirement obligation for the following periods (in thousands):


		Three Months Ended March 31,				Three Months Ended June 30,				Six Months Ended June 30,
		2021		2020				2021		2020		2021		2020
Asset retirement obligation, at beginning of period	Asset retirement obligation, at beginning of period	$	23,872	$	22,250		Asset retirement obligation, at beginning of period	$	24,313	$	22,685	$	23,872	$	22,250
Liabilities settled	Liabilities settled	0		0			Liabilities settled	0		(116)		0		(116)

Changes in estimated obligations							Changes in estimated obligations	26		0		26		0
Accretion of discount	Accretion of discount	441		435			Accretion of discount	441		434		882		869
Total asset retirement obligation, at end of period	Total asset retirement obligation, at end of period	$	24,313	$	22,685		Total asset retirement obligation, at end of period	$	24,780	$	23,003	$	24,780	$	23,003

1312

Table of Contents

Note 11 — REVENUE

Revenue Recognition—We account for revenue in accordance with ASC Topic 606 Revenue from Contracts with Customers ("ASC 606"). Under ASC 606, we recognize revenue when control of the promised goods or services is transferred to customers in an amount that reflects the consideration we expect to be entitled in exchange for those goods or services. The timing of revenue recognition, billings, and cash collection may result in contract assets or contract liabilities.

Contract Balances: As of ~~March 31,~~June 30, 2021, and December 31, 2020, we had ~~$33.8~~$33.6 million and $30.4 million of contract liabilities, respectively, which are included in "Other current liabilities" on the Condensed Consolidated Balance Sheets, primarily related to cash advances received from a customer for water purchases. Customer advances received before we have satisfied our performance obligations are accounted for as a contract liability (sometimes referred to in practice as deferred revenue). We will recognize the deferred revenue at the time the customer calls for water delivery, which we expect will be sourced from our existing long-term water rights. Our deferred revenue activity for the three and six months ended ~~March 31,~~June 30, 2021, and 2020 is shown below (in thousands):


		Three Months Ended March 31,				Three Months Ended June 30,				Six Months Ended June 30,
		2021		2020				2021		2020		2021		2020
Beginning balance	Beginning balance	$	30,419	$	16,612		Beginning balance	$	33,842	$	17,086	$	30,418	$	16,612
Additions	Additions	3,972		3,910			Additions	0		5,736		3,972		9,646
Recognized as revenue during period	Recognized as revenue during period	(549)		(3,436)			Recognized as revenue during period	(211)		(132)		(759)		(3,568)
Ending balance	Ending balance	$	33,842	$	17,086		Ending balance	$	33,631	$	22,690	$	33,631	$	22,690

Disaggregation of Revenue: The tables below show the disaggregation of revenue by product and reconciles disaggregated revenue to segment revenue for the three and six months ended ~~March 31,~~June 30, 2021, and 2020. We believe the disaggregation of revenue by products best depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic conditions (in thousands):


		Three Months Ended March 31, 2021												Three Months Ended June 30, 2021
Product	Product	Potash Segment		Trio® Segment			Oilfield Solutions Segment		Intersegment Eliminations		Total		Product	Potash Segment		Trio® Segment		Oilfield Solutions Segment		Intersegment Eliminations		Total
Potash	Potash	$	37,794	$	0		$	0	$	(62)	$	37,732	Potash	$	32,881	$	0	$	0	$	(60)	$	32,821
Trio®	Trio®	0		22,514			0		0		22,514		Trio®	0		26,340		0		0		26,340
Water	Water	1,159		984			3,343		0		5,486		Water	520		514		1,783		0		2,817
Salt	Salt	2,039		196			0		0		2,235		Salt	2,008		70		0		0		2,078
Magnesium Chloride	Magnesium Chloride	2,028		0			0		0		2,028		Magnesium Chloride	1,880		0		0		0		1,880
Brine Water	Brine Water	558		0			205		0		763		Brine Water	404		0		229		0		633
Other	Other	0		0			705		0		705		Other	0		0		1,319		0		1,319
Total Revenue	Total Revenue	$	43,578	$	23,694		$	4,253	$	(62)	$	71,463	Total Revenue	$	37,693	$	26,924	$	3,331	$	(60)	$	67,888

						Six Months Ended June 30, 2021

Product													Product	Potash Segment		Trio® Segment		Oilfield Solutions Segment		Intersegment Eliminations		Total
Potash													Potash	$	70,675	$	0	$	0	$	(122)	$	70,553
Trio®													Trio®	0		48,855		0		0		48,855
Water													Water	1,679		1,498		5,125		0		8,302
Salt													Salt	4,047		266		0		0		4,313
Magnesium Chloride													Magnesium Chloride	3,908		0		0		0		3,908
Brine Water													Brine Water	961		0		434		0		1,395
Other													Other	0		0		2,025		0		2,025
Total Revenue													Total Revenue	$	81,270	$	50,619	$	7,584	$	(122)	$	139,351

1413

Table of Contents


		Three Months Ended March 31, 2020												Three Months Ended June 30, 2020
Product	Product	Potash Segment		Trio® Segment			Oilfield Solutions Segment		Intersegment Eliminations		Total		Product	Potash Segment		Trio® Segment		Oilfield Solutions Segment		Intersegment Eliminations		Total
Potash	Potash	$	29,818	$	0		$	0	$	(129)	$	29,689	Potash	$	21,549	$	0	$	0	$	(74)	$	21,475
Trio®	Trio®	0		21,201			0		0		21,201		Trio®	0		18,832		0		0		18,832
Water	Water	583		1,247			6,661		0		8,491		Water	112		404		2,029		0		2,545
Salt	Salt	2,096		133			0		0		2,229		Salt	1,701		15		0		0		1,716
Magnesium Chloride	Magnesium Chloride	759		0			0		0		759		Magnesium Chloride	952		0		0		0		952
Brine Water	Brine Water	535		0			31		0		566		Brine Water	212		0		161		0		373
Other	Other	0		0			1,049		0		1,049		Other	0		0		557		0		557
Total Revenue	Total Revenue	$	33,791	$	22,581		$	7,741	$	(129)	$	63,984	Total Revenue	$	24,526	$	19,251	$	2,747	$	(74)	$	46,450

						Six Months Ended June 30, 2020

Product													Product	Potash Segment		Trio® Segment		Oilfield Solutions Segment		Intersegment Eliminations		Total
Potash													Potash	$	51,367	$	0	$	0	$	(203)	$	51,164
Trio®													Trio®	0		40,033		0		0		40,033
Water													Water	695		1,651		8,690		0		11,036
Salt													Salt	3,797		148		0		0		3,945
Magnesium Chloride													Magnesium Chloride	1,711		0		0		0		1,711
Brine Water													Brine Water	747		0		192		0		939
Other													Other	0		0		1,606		0		1,606
Total Revenue													Total Revenue	$	58,317	$	41,832	$	10,488	$	(203)	$	110,434

1514

Table of Contents

Note 12 — COMPENSATION PLANS

Equity Incentive Compensation Plan—Our Board of Directors and stockholders adopted a long-term incentive compensation plan called the Intrepid Potash, Inc. Amended and Restated Equity Incentive Plan (the "Plan"). The Plan was most recently amended and restated in May 2019. We have issued common stock, restricted stock, performance units, and non-qualified stock option awards under the Plan. At ~~March 31,~~June 30, 2021, approximately 0.6 million shares remained available for issuance under the Plan.

~~For~~In May 2021, the ~~three months ended~~Compensation Committee granted 16,535 shares of restricted stock to non-employee directors. The restricted shares vest one year after the date of grant, subject to continued employment. In March ~~31,~~ 2021, wethe Compensation Committee granted 42,445 shares ~~42,445~~ of restricted stock to executive officers and other key employees. These awards vest over three years, and in some cases, contain a market condition. As of ~~March 31,~~June 30, 2021, the following awards were outstanding under the Plan (in thousands):



						Outstanding as of ~~March 31,~~June 30, 2021
Restricted Shares						~~386~~336

Non-qualified Stock Options						288

Total share-based compensation expense was ~~$0.9~~$0.8 million and $1.0 million for the three months ended ~~March 31,~~June 30, 2021, and 2020, respectively, and $1.7 million and $2.0 million for the six months ended June 30, 2021, and 2020, respectively. As of ~~March 31,~~June 30, 2021, we had ~~$5.1~~$4.6 million of total remaining unrecognized compensation expense related to awards, that is expected to be recognized over a weighted-average period of ~~1.7~~1.5 years.

Note 13 — INCOME TAXES

Our anticipated annual tax rate is impacted primarily by the amount of taxable income associated with each jurisdiction in which our income is subject to income tax, permanent differences between the financial statement carrying amounts and tax bases of assets and liabilities.

During the three months ended ~~March 31,~~June 30, 2021, and 2020, we incurred 0 income tax expense. During the six months ended June 30, 2021, we incurred 0 income tax expense. During the six months ended June 30, 2020, we recognized an immaterial amount of income tax benefit. Our effective tax rate for the three months ended ~~March 31,~~June 30, 2021, and 2020, and the six months ended June 30, 2021, and 2020, was 0%. Our effective tax rates differed from the statutory rate during each period primarily due to changes in the valuation allowance established to offset our deferred tax assets.

Note 14 — COMMITMENTS AND CONTINGENCIES

Reclamation Deposits and Surety Bonds—As of ~~March 31,~~June 30, 2021, and December 31, 2020, we had $23.0 million of security placed principally with the State of Utah and the Bureau of Land Management for eventual reclamation of our various facilities. Of this total requirement, $0.5 million consisted of long-term restricted cash deposits reflected in "Other assets, net" on the condensed consolidated balance sheets and $22.5 million was secured by surety bonds issued by an insurer. The surety bonds are held in place by an annual fee paid to the issuer and a letter of credit.

We may be required to post additional security to fund future reclamation obligations as reclamation plans are updated or as governmental entities change requirements.

Legal—We are subject to claims and legal actions in the ordinary course of business. Legal costs are expensed as incurred. While there are uncertainties in predicting the outcome of any claim or legal action, except as noted below, we believe the ultimate resolution of these claims or actions is not ~~reasonable~~reasonably likely to have a material adverse effect on our financial condition, results of operations, or cash flows.

Mosaic Settlement

In March 2020, we entered into a definitive settlement agreement with Mosaic Potash Carlsbad Inc. ("Mosaic") related to a complaint originally brought against us and Steve Gamble in February 2015. Mr. Gamble is a former employee of Intrepid and Mosaic. Under the terms of the settlement agreement, we paid Mosaic an aggregate of $10 million in May 2020 to dismiss all current and future claims arising from this matter against us and the matter is now closed.

Table of Contents

Water Rights

In February 2019, Pecos Valley Artesian Conservancy District, Carlsbad Irrigation District, and Otis Mutual Domestic Water Consumers & Sewage Works Association (together, the "Protestants") filed an expedited inter se proceeding against us, Henry McDonald, Select Energy Services, LLC d/b/a Gregory Rockhouse Ranch, and Vision Resources, Inc. in the Fifth Judicial District Court for the County of Chaves in the State of New Mexico ("adjudication court"). This court

~~Table of Contents~~

serves as the adjudication court for the Pecos Stream System, which includes the Pecos River. The Protestants challenged the validity of our Pecos River water rights, representing approximately 20,000 acre feet per year. In August 2019, the parties stipulated to the jurisdiction of the adjudication court. To promote settlement, the adjudication court established a settlement schedule and ordered a trial date in August 2020 if the parties have not reached a settlement by that time. The trial date was subsequently rescheduled and a virtual trial began on December 8, 2020 and concluded on December 18, 2020. We expect a ruling from the adjudication court in late ~~spring or early~~ summer of 2021.

We were allowed to sell water associated with 5,700 acre feet per year of these water rights under preliminary authorizations issued in 2017 and 2018 by the New Mexico Office of the State Engineer ("OSE"). The preliminary authorizations allowed for water sales to begin immediately, subject to repayment if the underlying water rights are ultimately found to be invalid. Separate from the adjudication proceeding discussed above, the Protestants have protested these preliminary authorizations before the OSE. Although the OSE is required to hold a hearing relating to the protests, it had temporarily stayed the hearing process until the adjudication process is complete.

In December 2019, the Protestants filed a Petition for Writ of Mandamus against the OSE concerning the preliminary authorizations. A hearing regarding this Petition was held in March 2020, in the Fifth Judicial District Court for the County of Eddy in the State of New Mexico ("non-adjudication court") and the non-adjudication court granted the Writ of Mandamus against the OSE and required the OSE to withdraw and cancel seven preliminary authorizations issued to Intrepid in 2017 and 2018. These seven preliminary authorizations, which allowed us to sell up to 4,700 acre feet of water annually, were cancelled by the OSE on April 1, 2020, and we are currently not allowed to sell water under these cancelled preliminary authorizations.

A Motion for Reconsideration was filed and a hearing was held before the non-adjudication court on September 1, 2020, and was denied by the non-adjudication court on October 5, 2020. Subsequently, we and the OSE filed an appeal which is pending before the New Mexico Court of Appeals.

In March 2021, we received notice from a customer of a default under the terms of a long-term sales contract because we have not been able to deliver water to diversion points specified in the contract. We have relied primarily upon our Pecos River water rights to deliver water under this contract, the majority of which are currently unavailable due to the factors discussed above. We are ~~working~~continuing to work with the customer to resolve this issue. Under this contract we have received quarterly installments of approximately $3.9 million for the future delivery of water to the customer. In April 2021, we agreed to suspend the second quarter installment due from the customer as we continue to work to resolve the issue. If we are not able to resolve the issue, we may have to repay the ~~$32.7~~$32.5 million outstanding contract ~~liability.~~liability we have with this customer as of June 30, 2021. More detail on our contract liabilities can be found in Note 11—Revenue.

We are also subject to other claims and legal actions in the ordinary course of business. Legal costs are expensed as incurred. While there are uncertainties in predicting the outcome of any claim or legal action, we believe that the ultimate resolution of these other claims or actions is not reasonably likely to have a material adverse effect on our financial condition, results of operations, or cash flows.

1716

Table of Contents

Note 15 — FAIR VALUE

We measure our financial assets and liabilities in accordance with ASC Topic 820, Fair Value Measurements and Disclosures.

As of ~~March 31,~~June 30, 2021, and December 31, 2020, our cash consisted of bank deposits. Other financial assets and liabilities including accounts receivable, refundable income taxes, accounts payable, accrued liabilities, and advances on our credit facility are carried at cost which approximates fair value because of the short-term nature of these instruments.

In May of 2020, we acquired a non-controlling interest in W.D. Von Gonten Laboratories ("WDVGL") for $3.5 million. This investment is an equity investment without a readily determinable fair value and is recorded at cost with adjustments for observable changes in prices resulting from orderly transactions for the identical or a similar investment of the same issuer, or impairment (a Level 3 input), and is included in "Other assets, net" on the Condensed Consolidated Balance Sheets. We did not record any adjustments to the $3.5 million carrying value of the investment during the first ~~quarter~~six months of 2021.

As of ~~March 31, 2021, and~~ December 31, 2020, the estimated fair value of our outstanding Series B Senior Notes was ~~$15.7 million and~~ $15 ~~million, respectively.~~million. The fair value of our Notes iswas estimated using a discounted cash flow analysis based on current borrowing rates for debt with similar remaining maturities and ratings (a Level 2 input) and is designed to approximate the amount at which the instruments could be exchanged in an arm's-length transaction between knowledgeable willing parties.

1817

Table of Contents

Note 16 — BUSINESS SEGMENTS

Our operations are organized into 3 segments: potash, Trio® and oilfield solutions. The reportable segments are determined by management based on several factors including the types of products and services sold, production processes, markets served and the financial information available for our chief operating decision maker. We evaluate performance based on the gross margins of the respective business segments and do not allocate corporate selling and administrative expenses, among others, to the respective segments. Intersegment sales prices are market-based and are eliminated in the "Other" column. Information for each segment is provided in the tables that follow (in thousands).


Three Months Ended March 31, 2021		Potash		Trio®		Oilfield Solutions		Other		Consolidated
Three Months Ended June 30, 2021												Three Months Ended June 30, 2021	Potash		Trio®		Oilfield Solutions		Other		Consolidated
Sales	Sales	$	43,578	$	23,694	$	4,253	$	(62)	$	71,463	Sales	$	37,693	$	26,924	$	3,331	$	(60)	$	67,888
Less: Freight costs	Less: Freight costs	5,700		6,440		0		(62)		12,078		Less: Freight costs	4,138		6,037		0		(60)		10,115
Warehousing and handling costs	Warehousing and handling costs	1,456		1,176		0		0		2,632		Warehousing and handling costs	1,306		1,072		0		0		2,378
Cost of goods sold	Cost of goods sold	27,749		16,148		3,748		0		47,645		Cost of goods sold	22,118		16,653		2,425		0		41,196

Gross Margin (Deficit)		$	8,673	$	(70)	$	505	$	0	$	9,108
Gross Margin												Gross Margin	$	10,131	$	3,162	$	906	$	0	$	14,199
Depreciation, depletion, and amortization incurred1	Depreciation, depletion, and amortization incurred1	$	7,178	$	1,507	$	688	$	188	$	9,561	Depreciation, depletion, and amortization incurred1	$	6,460	$	1,376	$	700	$	143	$	8,679

Three Months Ended March 31, 2020		Potash		Trio®		Oilfield Solutions		Other		Consolidated
Six Months Ended June 30, 2021												Six Months Ended June 30, 2021	Potash		Trio®		Oilfield Solutions		Other		Consolidated
Sales	Sales	$	33,791	$	22,581	$	7,741	$	(129)	$	63,984	Sales	$	81,270	$	50,619	$	7,584	$	(122)	$	139,351
Less: Freight costs	Less: Freight costs	5,441		6,548		0		(129)		11,860		Less: Freight costs	9,838		12,477		0		(122)		22,193
Warehousing and handling costs	Warehousing and handling costs	1,296		1,608		0		0		2,904		Warehousing and handling costs	2,762		2,248		0		0		5,010
Cost of goods sold	Cost of goods sold	22,720		17,430		2,897		0		43,047		Cost of goods sold	49,867		32,801		6,173		0		88,841
Lower of cost or net realizable value inventory adjustments		—		550		0		—		550

Gross Margin (Deficit)		$	4,334	$	(3,555)	$	4,844	$	0	$	5,623

Gross Margin												Gross Margin	$	18,803	$	3,093	$	1,411	$	0	$	23,307
Depreciation, depletion, and amortization incurred1	Depreciation, depletion, and amortization incurred1	$	7,312	$	1,508	$	632	$	214	$	9,666	Depreciation, depletion, and amortization incurred1	$	13,637	$	2,883	$	1,388	$	332	$	18,240

Table of Contents


Three Months Ended June 30, 2020	Potash		Trio®		Oilfield Solutions		Other		Consolidated
Sales	$	24,526	$	19,251	$	2,747	$	(74)	$	46,450
Less: Freight costs	3,286		5,523		0		(74)		8,735
Warehousing and handling costs	1,204		861		0		0		2,065
Cost of goods sold	17,650		14,222		2,136		0		34,008
Lower of cost or net realizable value inventory adjustments	371		1,870		0		—		2,241

Gross Margin (Deficit)	$	2,015	$	(3,225)	$	611	$	0	$	(599)
Depreciation, depletion, and amortization incurred1	$	5,742	$	1,516	$	657	$	209	$	8,124

Six Months Ended June 30, 2020	Potash		Trio®		Oilfield Solutions		Other		Consolidated
Sales	$	58,317	$	41,832	$	10,488	$	(203)	$	110,434
Less: Freight costs	8,727		12,071		0		(203)		20,595
Warehousing and handling costs	2,500		2,469		0		0		4,969
Cost of goods sold	40,370		31,652		5,033		0		77,055
Lower of cost or net realizable value inventory adjustments	371		2,420		0		—		2,791

Gross Margin (Deficit)	$	6,349	$	(6,780)	$	5,455	$	0	$	5,024
Depreciation, depletion and amortization incurred1	$	13,054	$	3,025	$	1,289	$	422	$	17,790

1 Depreciation, depletion, and amortization incurred for potash and Trio® excludes depreciation, depletion and amortization amounts absorbed in or relieved from inventory.

Table of Contents

ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

This Quarterly Report on Form 10-Q (this "Quarterly Report") contains forward-looking statements within the meaning of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the Securities Act of 1933, as amended. These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements in this Quarterly Report other than statements of historical fact are forward-looking statements. Forward-looking statements include statements about, among other things, our future results of operations and financial position, our business strategy and plans, our ESG (as defined below) initiatives and our objectives for future ~~operations, among other things.~~operations. In some cases, you can identify these statements by forward-looking words, such as "estimate," "expect," "anticipate," "project," "plan," "intend," "believe," "forecast," "foresee," "likely," "may," "should," "goal," "target," "might," "will," "could," "predict," and "continue." Forward-looking statements are only predictions based on our current knowledge, expectations, and projections about future events.

These forward-looking statements are subject to a number of risks, uncertainties, and assumptions, including the following:

•changes in the price, demand, or supply of our products and services;

•challenges to our water rights;

•our ability to successfully identify and implement any opportunities to grow our business whether through expanded sales of water, Trio®, byproducts, and other non-potassium related products or other revenue diversification activities;

•~~our ability to sell Trio~~® ~~internationally and manage risks associated with international sales, including pricing pressure and freight costs;~~

•the costs of, and our ability to successfully execute, any strategic projects;

•declines or changes in agricultural production or fertilizer application rates;

•declines in the use of potassium-related products or water by oil and gas companies in their drilling operations;

•our ability to prevail in outstanding legal proceedings against us;

•our ability to comply with the terms of our ~~senior notes and our~~ revolving credit facility, including the underlying covenants, to avoid a default under ~~those agreements;~~that agreement;

•further write-downs of the carrying value of assets, including inventories;

•circumstances that disrupt or limit production, including operational difficulties or variances, geological or geotechnical variances, equipment failures, environmental hazards, and other unexpected events or problems;

•changes in reserve estimates;

•currency fluctuations;

•adverse changes in economic conditions or credit markets;

•the impact of governmental regulations, including environmental and mining regulations, the enforcement of those regulations, and governmental policy changes;

•adverse weather events, including events affecting precipitation and evaporation rates at our solar solution mines;

•increased labor costs or difficulties in hiring and retaining qualified employees and contractors, including workers with mining, mineral processing, or construction expertise;

•changes in the prices of raw materials, including chemicals, natural gas, and power;

•our ability to obtain and maintain any necessary governmental permits or leases relating to current or future operations;

•interruptions in rail or truck transportation services, or fluctuations in the costs of these services;

•our inability to fund necessary capital investments;

•the impact of the ~~novel coronavirus (COVID-19)~~COVID-19 pandemic on our business, operations, liquidity, financial condition and results of operations; and

~~Table of Contents~~

•the other risks, uncertainties, and assumptions described in Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2020, as updated by our subsequent Quarterly Reports on Form 10-Q.

Table of Contents

In addition, new risks emerge from time to time. It is not possible for our management to predict all risks that may cause actual results to differ materially from those contained in any forward-looking statements we may make.

In light of these risks, uncertainties, and assumptions, the future events and trends discussed in this Quarterly Report may not occur and actual results could differ materially and adversely from those anticipated or implied in these forward-looking statements. As a result, you should not place undue reliance on these forward-looking statements. We undertake no duty to update or revise publicly any forward-looking statements to conform those statements to actual results or to reflect new information or future events.

Throughout this Quarterly Report, we refer to average net realized sales price per ton, which is a non-GAAP financial measure. More information about this measure, including a reconciliation of this measure to the most directly comparable GAAP financial measure, is below under the heading "Non-GAAP Financial Measure."

Table of Contents

Company Overview

We are a diversified mineral company that delivers potassium, magnesium, sulfur, salt, and water products essential for customer success in agriculture, animal feed and the oil and gas industry. We are the only U.S. producer of muriate of potash (sometimes referred to as potassium chloride, KCl or potash), which is applied as an essential nutrient for healthy crop development, utilized in several industrial applications, and used as an ingredient in animal feed. In addition, we produce a specialty fertilizer, Trio®, which delivers three key nutrients, potassium, magnesium, and sulfate, in a single particle. We also provide water, magnesium chloride, brine and various oilfield products and services.

Our extraction and production operations are conducted entirely in the continental United States. We produce potash from three solution mining facilities: our HB solution mine in Carlsbad, New Mexico, our solution mine in Moab, Utah, and our brine recovery mine in Wendover, Utah. We also operate our North compaction facility in Carlsbad, New Mexico, which compacts and granulates product from the HB mine. We produce Trio® from our conventional underground East mine in Carlsbad, New Mexico.

We have three segments: potash, Trio®, and oilfield solutions. We account for the sale of byproducts as revenue in the potash or Trio® segment based on which segment generated the byproduct.

Table of Contents

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

We are committed to a goal of providing consistent returns to our shareholders while maintaining a strong sense of good corporate citizenship that places a high value on the welfare of our employees, the communities in which we operate, the customers we serve, and the world as a whole. We believe that prioritizing, improving, and managing our Environmental, Social, and Governance (“ESG”) goals will allow us to better create long-term value for our investors. We have made our ESG program a key initiative for our management team and we are committed to a plan to provide focused reporting on those ESG issues that we believe are the most relevant to our business and important to our stakeholders. We understand that clearly disclosing the goals and metrics related to our ESG programs will allow our stakeholders to be informed about our progress and we look forward to expanding our disclosures in future periods. A summary of our ESG goals under the United Nations Sustainable Development Goals framework is available on our website at intrepidpotash.com. An update on recent ESG highlights and initiatives is shown below.

Commitment to the Environment

We rely on the environments, resources and ecosystems surrounding our locations in all segments of our business. We work closely with our communities and make it a priority to protect the natural resources surrounding our operations.

–Full-Cycle Water Management - We are actively developing water treatment and recycling operations in the Delaware Basin. Recycled water will help reduce the produced water traditionally used in oil and gas operations and reduce the amount of produced water that is injected into produced water disposal wells.

–Solar solution mining potash - All of our potash is currently produced at solar solution mines, one of the most environmentally friendly and energy efficient mining techniques. We inject a naturally occurring, salt saturated brine solution into underground caverns or previously shuttered mine workings. This brine selectively dissolves the remaining potash, which is then pumped back to the surface and into evaporation ponds. During the spring and summer months, the brine naturally evaporates, leaving only the salt and potash solids in the ponds, which we then process into the products we sell. By using solar energy, we do not need to burn natural gas or coal to evaporate our brine ponds.

–Salt laydown at the Bonneville Salt Flats - We are committed to helping maintain the environments in which we operate, one of which is the Bonneville Salt Flats near our Wendover, UT mine. Since 2005, we have donated free of cost to the BLM nearly 7 million tons of salt that has been deposited on the racetrack to help preserve this unique attraction in northwest Utah.

–We are the only OMRI-listed potash and langbeinite producer in the United States. We became OMRI-listed in 2007 for our langbeinite, or Trio®, product, and in 2018 for our potash products at our Moab and Wendover operating facilities. We are also registered in the Organic Input Material Program through the California Department of Food and Agriculture, a program which registers fertilizers that can be used in organic crop and food production.

–We work closely with the Bureau of Land Management and other government and regulatory agencies to preserve historical sites near our operations such as the Maroon Cliffs in Carlsbad, New Mexico and petroglyphs near our Utah operations. We also work with and have supported agencies dedicated to studying and protecting endangered species near our operations such as the sand dune lizards in New Mexico.

Our Social Impact and Supporting our Communities

Our employees live and work in small, tight knit communities and we are deeply involved in volunteering and being active community members.

Our New Mexico operations have partnered with the United Way of Carlsbad and South Eddy County since 2004, participating in a variety of community-focused events and activities such as United Way's annual Day of Caring event. We encourage all our employees to volunteer in their communities and we offer all our full-time employees three paid volunteer days each year to support either a charitable organization of their choosing or participate in an Intrepid sponsored volunteer project.

We recently partnered with the Dead Horse Point State Park which overlooks our Moab, Utah facility to update information regarding our facilities and how we utilize the natural environment and climate in Moab to produce potash. In previous years, we proudly funded the construction of numerous bike trails in the park, known as the Intrepid Trail System.

Our Commitment to a Diverse Workforce

We are committed to a recruitment and hiring process that emphasizes and embraces diversity. We believe a diverse workforce leads to greater collaboration, innovation, and improves shareholder returns and we celebrate the great value the differences in our people bring to our organization. We support a variety of organizations within our communities including the

Table of Contents

Women's Leadership Foundation, a Colorado based organization with the goal of opening more board of director positions to women leaders in Colorado and beyond.

Our Commitment to Safety

Safety audits are conducted across all our locations to ensure a thoughtful approach can be taken that increases the safe execution of all tasks. Through our audits and dialogue, we educate ourselves and understand the potential hazards present, create best practices that can be shared, and address areas where improvements can be made. Prior to each task, employees are required to: assemble the proper personal protection equipment, tools, permits, etc., make sure the area is safe for employees and contractors, discuss the task with all stakeholders, and understand how the task is related to the overall business.

We conduct safety audits of our operations on a monthly basis. The data from these safety audits is collected to analyze where, what, and why gaps exist, and to provide meaningful information that results in safer work for our employees.

Business Ethics

Since inception, Intrepid has placed the highest emphasis on conducting its business with honesty and integrity. These standards are expected of management and employees alike, and we continuously strive to create a corporate culture of honesty, integrity, and trust.

The policies we have developed are intended to:

–Maintain and communicate our core value of integrity and disseminate our core values and the legal requirements applicable to good business conduct and ethical behavior.

–Annual refresher training on company policies, values, interpreting laws, and handling a variety of potential company-related issues and situations.

–Resources for employees to report any suspected violations of our company policies, including, an anonymous employee hotline via phone and internet.

–Provide clear and well-defined procedures by which employees can easily obtain information, ask questions, and, if necessary, report any suspected violations of any of our Business Ethics policies.

–Maintain and communicate a Code of Business Conduct and Ethics which clearly articulates the company’s values, culture, and practices.

COVID-19 Response

We took quick and decisive action in early 2020 to limit the impacts of COVID-19 on our employees and operations. We instituted a work-from-home policy for employees when possible, providing additional resources to ensure our employees could be successful and supported in their new work environment. When work-from-home was not possible, we implemented strict social distancing measures at our operation facilities along with staggered schedules where possible.

Other actions included:

–Consistent review of staffing to ensure meeting state and federal guidelines

–Provided additional resources to employees for their continued physical, mental, and financial well-being

–Implemented strict visitor restrictions at our sites and limited corporate travel

–Additional cleaning protocols at all our sites

–Held on-site vaccination clinics at no cost to our employees

As vaccinations become readily available across the country we have begun to relax certain restrictions on our social distancing and work-from-home policies for vaccinated employees. We will continue to monitor state and federal guidelines and recommendations, issued by the Centers for Disease Control, World Health Organization and local governments and will revise our company policies accordingly.

Table of Contents

Significant Business Trends and Activities

~~The novel strain of coronavirus (COVID-19) has surfaced in nearly all regions around the world.~~ As an essential business we continue to operate through-out the COVID-19 pandemic to produce potash and Trio® and serve oil and gas markets through our oilfield solutions business. The safety and protection of our workforce is our first and foremost priority. We continue to follow various procedures we implemented to help minimize the risks to our employees, including changes in our operating procedures to accommodate social distancing guidelines, additional cleaning and disinfection procedures and requiring those employees who can work from home to do so.

We continue to monitor the guidance from various authorities, including federal, state and local public health authorities and may take additional actions based on their recommendations. There may be developments outside our control that would require us to adjust our operating plans.

Our 2020 results were materially impacted by the COVID-19 pandemic, particularly our oilfield solutions segment as many of the actions taken to help prevent the spread of COVID-19 decreased demand for oil. Economic activity is improving in ~~early~~ 2021 with most cities and states reducing restrictions when compared to the summer of 2020. However, governmental authorities may reinstate other restrictive orders due to a continued resurgence of COVID-19 related cases. Such restrictive actions may lead to further or continued decreases in the demand for oil and may impact our other operations if expanded restrictions are deemed necessary to mitigate the public health effects of the COVID-19 pandemic. Given the dynamic nature of this situation, we cannot reasonably estimate the impacts of COVID-19 on our financial condition, results of operations, liquidity or cash flows in the future. We expect that if governmental authorities increase other restrictive orders, such actions may have a material effect on revenue growth, financial condition, liquidity, and overall profitability in future reporting periods.

Our financial results have been, or are expected to be, impacted by several significant trends and activities, including impacts from the COVID-19 pandemic, as discussed below. We expect that the trends described below may continue to impact our results of operations, cash flows, and financial position.

• Potash pricing and demand. Potash sales ~~volumes~~volume increased 24% and 20% in the second quarter and first ~~quarter~~half of 2021, ~~increased 18%~~respectively, when compared to the ~~first quarter of 2020~~prior year periods. Fertilizer demand remains strong across the country as ~~strong~~higher commodity prices ~~and favorable weather drove strong demand for fertilizer products across~~support robust application rates in most ~~parts~~ of ~~the country.~~our markets. Our sales volumes into industrial markets ~~decreased~~improved slightly in the ~~first~~second quarter of 2021 compared to the prior year, ~~due in large part~~as oilfield activity continues to ~~the impacts of the~~recover from COVID-19 ~~pandemic.~~related impacts. The majority of our industrial potash sales are into oil and gas markets and correlate to drilling and completion activity, which ~~has~~ slowed significantly during 2020 due to the containment actions taken to help reduce the spread of COVID-19, and activity remains below pre-pandemic levels. We have been successful in shifting sales towards our growing animal feed and organic markets and also continuing to expand our sales into high-margin agricultural areas near our operations. Additional or renewed restrictions enacted in response to the COVID-19 pandemic may impact our sales if such actions affect available labor, transportation logistics, or cause supply disruptions.

Global effective capacity continues to exceed demand and larger producers have worked to balance the market through production curtailments. Domestic pricing of our potash is influenced principally by the price established by our competitors. The interaction of global potash supply and demand, ocean, land, and barge freight rates, currency fluctuations, and crop commodity values and outlook, also influence pricing.

Our potash average net realized sales price per ton increased to ~~$282~~$319 for the three months ended ~~March 31,~~June 30, 2021, compared to ~~$255~~$256 for the same period in 2020 ~~due to~~as multiple price increases announced in ~~the fourth quarter of 2020 and another~~recent quarters begin to materialize in our results. Potash price ~~increase announced in February 2021. We layered in first quarter sales tons at varying price levels and expect our net realized sales price per ton will increase~~continued to move higher in the second quarter of ~~2021.~~2021 as strong demand and limited supply, particularly in the barge market, pushed spot pricing up significantly towards the end of the second quarter. In June 2021, we announced a $90 increase to our sales price per ton to reflect the current market, although the majority of our third quarter sales were committed prior to this price increase. Our price expectations could be affected by, among other things, weather, planting decisions, rail car availability, commodity price decreases as a result of the COVID-19 pandemic, and the price and availability of other potassium products.

With potash sales comprising ~~53%~~51% of our total sales in the first ~~three~~six months of 2021, potash prices continue to be a significant driver of our profitability. Pricing of our potash is influenced principally by the price established by our competitors. The interaction of global potash supply and demand, ocean, land, and barge freight rates, and currency fluctuations also influence pricing.

2325

Table of Contents

We experience seasonality in potash demand, with more purchases historically occurring in March through May and September through November when purchasers are looking to have product on hand for the spring and fall application seasons in the United States. Various factors affect potash sales and shipments, thereby increasing volatility of sales volumes from quarter to quarter and season to season. The specific timing of when farmers apply potash remains highly weather dependent and varies across the numerous growing regions within the U.S. The timing of potash sales is also significantly influenced by the marketing programs of potash producers, as well as storage volumes closer to the farm gate. Our sales volumes into the industrial market correlate to drilling activity in the oil and gas market, which slowed significantly during 2020, due to the containment actions taken to help reduce the spread of COVID-19. While restrictions have generally relaxed over the past few months, any further containment actions taken in response to the COVID-19 pandemic may impact future fertilizer application seasons if such actions affect available labor, transportation logistics, or cause supply disruptions.

• Trio® pricing and demand. Our Trio® average net realized sales price per ton increased ~~21%~~30% and 26% during the second quarter and first ~~quarter~~half of 2021, respectively, as compared to the ~~first quarter~~same periods of ~~2020 due to price increases in domestic markets and fewer international sales.~~2020. Similar to our potash sales, ~~we layered~~our second quarter and year to date results benefited from the multiple price increases announced in recent quarters. We increased our ~~first quarter 2021~~ Trio® ~~sales at increasing~~ price ~~levels~~per ton by $35 in late June 2021 in response to the increased potash spot price as discussed above. Unlike potash, we had minimal volumes committed prior to the price increase and expect the majority of this price increase will be realized in our ~~net realized price will continue to increase into the second quarter.~~third quarter results. Our ability to recognize the increased prices may be affected by, among other things, weather, planting decisions, rail car availability, commodity price decreases as a result of the COVID-19 pandemic, and the price and availability of other potassium products.

Trio® sales volume ~~decreased 9% during~~increased 17% and 4% in the second quarter and first ~~three months~~half of 2021, respectively, when compared to the ~~first three months of 2020, as~~prior year periods. Higher commodity pricing led to strong demand in our domestic markets ~~was~~which more than offset by reduced international sales. We expect to ~~sell limited tons into~~remain very selective in international markets as we focus on growing our domestic Trio® sales. ~~We recognize a lower average net realized sales price per ton for international sales compared to domestic sales, due to the increased freight costs to ship Trio~~® ~~to international destinations.~~

We also experience seasonality in domestic Trio® demand, with more purchases coming in the first and second quarters in advance of the spring application season in the U.S. In turn, we generally have increased inventory levels in the third and fourth quarters in anticipation of expected demand for the following year. Further actions taken in response to the COVID-19 pandemic may also impact seasonal demand patterns if there is an effect on available labor, transportation logistics, or supply disruptions. We continue to operate our facilities at production levels that approximate expected demand and allow us to manage inventory levels. ~~Certain products rely more heavily on international markets, particularly standard Trio~~®. Our international warehouse temporarily closed in response to the COVID-19 pandemic in the first quarter of 2020 and was reopened during the second quarter of 2020 and currently remains open, but we may see additional closures if there is a resurgence of COVID-19 related cases, which could reduce demand in future periods. We reduced the production of fine langbeinite in the second quarter of 2020 to manage inventory levels and we expect to operate at these reduced production rates for the foreseeable future to manage inventory levels.

• Water sales. In the ~~first~~second quarter of 2021, total water sales were ~~$5.5~~$2.8 million compared to ~~$8.5~~$2.5 million during the same period of 2020. WeOilfield activity is increasing in the areas we operate and we expect water sales will continue to ~~experience decreased demand for water and other oilfield products and services when compared to~~improve in the ~~first quarter~~second half of ~~2020 as a result of the COVID-19 pandemic.~~2021. Rig counts, oil pricing, and oilfield activity have increased from the summer of 2020 and we expect oilfield activity will improve as the year continues, although economic uncertainty and the potential for future restrictions enacted by state and local governments resulting from the COVID-19 pandemic make forecasting future drilling activities difficult.

An update to legal proceedings concerning our water rights is contained in Note 14 of our unaudited condensed consolidated financial statements included in "Item 1. Condensed Consolidated Financial Statements (Unaudited)" of this Quarterly Report on Form 10-Q.

• Byproduct sales. We sell byproducts such as salt, magnesium chloride, brines, and water that are derived from our potash and Trio® operations. Byproduct sales were ~~$7.0 million for the three months ended March 31, 2021, compared to~~ $5.4 million for the three months ended ~~March 31, 2020.~~June 30, 2021, compared to $3.4 million for the three months ended June 30, 2020, and $12.4 million for the six months ended June 30, 2021, compared to $8.7 million for the comparable prior year period. The increase ~~during~~for both the ~~first quarter of 2021~~three and six month periods was ~~primarily~~ due to ~~a $1.3 million increase in sales of magnesium chloride and a $0.3 million increase in~~increased byproduct water ~~sales.~~and brine sales as oilfield activity continues to recover from COVID-19 related impacts. Magnesium chlorides sales also increased in both periods due to increased product availability compared to the prior year. Wet weather in the summer of 2019 significantly limited our production of magnesium chloride and we had less product to sell in the first ~~quarter~~half of 2020. ~~Magnesium chloride production returned to historic rates in the second half of 2020 and we expect that will continue in 2021 assuming average precipitation rates at our Wendover facility.~~

• Diversification of products and services. We continue to diversify our products and services, particularly on our Intrepid South property. In addition to water sales, Intrepid South generates revenue from right-of-way agreements, surface damages and easements, caliche sales, a produced water royalty, and sales of cattle. We are also currently negotiating water transfer agreements with customers throughout the basin to utilize our existing infrastructure. As part of the Intrepid South acquisition, we acquired state grazing leases and submitted a comprehensive grazing plan which is currently pending

~~Table of Contents~~

approval with the New Mexico State Land Office. In the third quarter of 2020, we purchased a 400-head commercial cattle herd which we plan to move to our grazing leases when we receive final approval. We added a brine station at our Intrepid South property in February 2020 and are reviewing opportunities to develop a produced water facility, although uncertainties in oil and gas operations due to the COVID-19 pandemic have made the timing

Table of ~~this development uncertain.~~Contents

In March 2020, we sold approximately 320 acres of fee land from our Intrepid South property for $4.8 million and recognized a gain on the sale of the land of $4.7 million. The terms of the sale were highly restrictive and only allow the buyer to drill Acid Gas Injection ("AGI") wells on the property to dispose of natural gas with high concentrations of hydrogen sulfide ("H2S"). No water rights were included in the land sale, we retained surface access, and we restricted the use of caliche located on the property to the acreage that was sold in order to prevent sales to third parties or decrease future sales to the buyer. Due to the strategic location of Intrepid South, part of our long-term operating strategy is selling small parcels of land, including restricted use agreements of surface or subsurface rights, to customers, where such sales provide a solution to asuch customer's operations in the oil and gas industry. We may have additional strategic sales of small parcels of land in the future.

In May 2021, we sold 326 acres of land in Texas for $6.0 million and recognized a gain on the sale of the land of $2.8 million. We purchased this land in May 2019 for the development of a produced water disposal facility and had permitted two disposal wells on the property. Unlike the strategic land sale completed in March 2020 discussed above, we did not include any restrictions on the buyer of this land.

In May 2020, we acquired an 11% equity stake in the W.D. Von Gonten Laboratories ("WDVGL"), a global industry leader in drilling and completion chemistry and a strong supporter of the use of potassium chloride in oil and gas drilling and completion activities. With this investment we plan to revitalize our industrial sales and high-speed mixing service given the poor performance of clay-inhibition chemical substitutes in certain formations. Our investment in WDVGL is also part of our strategy to leverage our existing oil and gas midstream businesses in southeast New Mexico and expand into additional oil and gas midstream and upstream activities. This expansion may be through organic growth, other strategic investments, partnerships, or acquisitions of complementary businesses that expand our product and service offerings beyond our existing assets or products. Additionally, we may expand into oil and natural gas exploration and production or into new products or services in our current industry or other industries.

2527

Table of Contents

Consolidated Results


(in thousands, except per ton amounts)	(in thousands, except per ton amounts)	Three Months Ended March 31,				(in thousands, except per ton amounts)	Three Months Ended June 30,				Six Months Ended June 30,
		2021		2020					2021		2020		2021		2020
Sales1	Sales1	$	71,463	$	63,984			Sales1	$	67,888	$	46,450	$	139,351	$	110,434

Cost of goods sold	Cost of goods sold	$	47,645	$	43,047			Cost of goods sold	$	41,196	$	34,008	$	88,841	$	77,055

Gross Margin		$	9,108	$	5,623
Gross Margin (Deficit)								Gross Margin (Deficit)	$	14,199	$	(599)	$	23,307	$	5,024

Selling and administrative	Selling and administrative	$	5,791	$	6,599			Selling and administrative	$	6,612	$	6,673	$	12,403	$	13,272

Net Income (Loss)	Net Income (Loss)	$	2,451	$	(7,397)			Net Income (Loss)	$	19,499	$	(8,872)	$	21,950	$	(16,269)

Average net realized sales price per ton2	Average net realized sales price per ton2							Average net realized sales price per ton2
Potash	Potash	$	282	$	255			Potash	$	319	$	256	$	300	$	256
Trio®	Trio®	$	233	$	193			Trio®	$	271	$	208	$	251	$	200

1Sales include sales of byproducts which were ~~$7.0~~$5.4 million and ~~$5.4~~$3.4 million for the three months ended ~~March 31,~~June 30, 2021, and 2020, ~~respectively.~~respectively, and $12.4 million and $8.7 million for the six months ended June 30, 2021, and 2020, respectively..

2Average net realized sales price per ton is a non-GAAP financial measure. More information about this non-GAAP financial measure is below under the heading "Non-GAAP Financial Measure."

Consolidated Results for the Three Months Ended ~~March 31,~~June 30, 2021, and 2020

Our total sales for the three months ended ~~March 31,~~June 30, 2021 increased ~~$7.5~~$21.4 million, or ~~12%~~46%, as compared to the three months ended ~~March 31,~~June 30, 2020. Our potash sales increased ~~$8.0~~$11.3 million, or ~~27%~~53%, during the ~~first~~second quarter of 2021 as compared to the ~~first~~second quarter of 2020, as we sold ~~18%~~24% more tons and our average net realized sales price per ton increased ~~11%~~25% in the ~~first~~second quarter of 2021. WeThe increase in tons sold ~~25%~~during the second quarter of 2021, compared to the second quarter of 2020, was driven mainly by selling 28% more tons of potash into the agricultural ~~market in~~market. Rising crop prices and the ~~first quarter of 2021, compared to~~economic rebound from the first quarter of 2020, partially offset by selling fewer tons of potash into the industrial market. Increases in corn, soybean and wheat prices drove our increase in tons of potash sold into the agricultural market. The majority of our industrial potash sales are into oil and gas markets and correlate to drilling and completion activity, which were still negatively affected by containment actions taken to help reduce the spread of COVID-19.COVID-19 pandemic created greater demand for potash. Our potash average net realized sales price per ton increased ~~11%~~25% due to multiple price increases announced insince the fourth ~~quarter of 2020 and another price increase announced in February 2021. We layered in first quarter sales tons at varying increased price levels as compared to the first~~ quarter of 2020.

Our Trio® sales increased ~~$1.3~~$7.5 million, or 6%40%, in the ~~first~~second quarter of 2021, as compared to the ~~first~~second quarter of 2020, as our average net realized sales price per ton increased ~~21%~~30%, ~~partially offset by~~combined with a ~~9% decrease~~17% increase in tons sold. ~~Our Trio~~® ~~tons sold decreased in the first quarter of 2021, as compared to the first quarter of 2020, as we sold fewer tons into international markets, due to our continued focus on the domestic Trio~~® ~~market.~~ Our Trio® average net realized sales price per ton increased due to multiple price increases announced ~~during~~since the fourth quarter of ~~2020 and~~2020. Our Trio® tons sold increased in the ~~first~~second quarter of 2021, ~~combined with a decrease in international sales which generally have a lower net realized sales price per ton.~~as compared to the second quarter of 2020, due to rising crop prices and the economic rebound from the COVID-19 pandemic.

Our total water sales, ~~excluding~~including byproduct water sales, ~~decreased $3.3~~increased $0.3 million, or ~~50%~~11%, in the ~~first~~second quarter of 2021, compared to the ~~first~~second quarter of 2020. ~~We continue to experience decreased demand for~~During the second quarter 2021, our byproduct water ~~when~~sales increased $0.5 million, or 100%, compared to the ~~first~~second quarter of 2020, ~~as a result of~~while our water sales recorded in our oilfield solutions segment decreased $0.2 million, or 12%. The overall increase in total water sales was due to increased oilfield activities due to the economic rebound from the COVID-19 pandemic. Rig counts, oil pricing, and oilfield activity have increased from the summer of 2020 and we expect oilfield activity will improve as the year continues, although economic uncertainty and the potential for future restrictions enacted by state and local governments resulting from the COVID-19 pandemic make forecasting future drilling activities difficult.

Our total byproduct sales, increased ~~$1.6~~$2.0 million in the ~~first~~second quarter of 2021, compared to the ~~first~~second quarter of 2020, due to a ~~$1.3~~$0.9 million increase in magnesium chloride sales, ~~and~~ a ~~$0.3~~$0.5 million increase in byproduct water sales as discussed above, a $0.4 million increase in byproduct salt sales, and a $0.2 million increase in brine water sales. Magnesium chloride sales improved as we had more product to sell during the ~~first~~second quarter of 2021, as compared to the ~~first~~second quarter of 2020, due to the above average evaporation during the summer of 2020. Byproduct ~~water~~salt sales increased in the ~~first~~second quarter of 2021, compared to the ~~first~~second quarter of 2020, as ~~a higher percentage~~we sold more salt from our East facility in New Mexico. Brine water sales increased in the second quarter of ~~our total barrels~~2021, compared to the second quarter of ~~water sold was byproduct water.~~2020, due to the increase in oilfield activities.

Cost of Goods Sold

Our total cost of goods sold increased ~~$4.6~~$7.2 million, or ~~11%~~21%, during the ~~first~~second quarter of 2021 compared to the ~~first~~second quarter of 2020. Our potash cost of goods sold increased by ~~$5.0~~$4.5 million, or ~~22%~~25%, during the ~~first~~second quarter of 2021 compared to the ~~first~~second quarter of 2020, driven mainly by a ~~18%~~24% increase in potash tons sold. Our Trio® cost of goods sold ~~decreased $1.3~~

~~Table of Contents~~

increased $2.4 million, or 7%17%, for the three months ended ~~March 31,~~June 30, 2021 as compared to the three months ended ~~March 31,~~June 30, 2020, due ~~mainly~~ to a ~~9% decrease~~17% increase in Trio® tons sold. Our cost of goods sold for the Oilfield Solutions Segment increased ~~$0.9~~$0.3 million, or ~~29%~~14%, for the

Table of Contents

three months ended ~~March 31,~~June 30, 2021, compared to the three months ended ~~March 31,~~June 30, 2020, as we incurred increased rental and electrical costs.

Gross Margin

During the second quarter of 2021, we generated a gross margin of $14.2 million compared to a negative gross margin of $0.6 million during the second quarter of 2020, due to the factors discussed above.

Gain on Sale of an Asset

In May 2021, we sold 326 acres of land in Texas for $6.0 million and recognized a gain on the sale of the land of $2.8 million. We purchased this land in May 2019 for the development of a produced water disposal facility and had permitted two disposal wells on the property. Unlike the strategic land sale completed in March 2020 discussed below, we did not include any restrictions on buyer of this land.

Interest Expense

During the second quarter of 2021, our interest expense increased $0.3 million as compared to ~~purchase~~the second quarter of 2020, due to paying a $0.5 million "make-whole" payment related to the early prepayment of our Series B Senior Notes in June 2021, partially offset by incurring less interest in the second quarter of 2021 as we prepaid our Series C Senior Notes in July 2020.

Gain on Extinguishment of Debt

In June 2021, we received notice that the Small Business Administration ("SBA") had remitted funds to our bank to fully repay our $10 million loan we received in April 2020 under the Paycheck Protection Program (the "PPP") under the CARES Act. We elected to record the proceeds received under the PPP loan as debt and apply debt accounting prescribed under Accounting Standards Codification Topic 470. Accordingly, we recognized a gain of $10.1 million related to the forgiveness of the $10 million PPP loan and the associated accrued interest on the loan.

Net Income

We generated net income of $19.5 million for the three months ended June 30, 2021, compared to a net loss of $8.9 million in the same period in 2020, due to the factors discussed above.

Consolidated Results for the Six Months Ended June 30, 2021, and 2020

Our total sales for the six months ended June 30, 2021, increased $28.9 million or 26%, as compared to the six months ended June 30, 2020. Our potash sales during the first half of 2021 increased $19.4 million, or 38%, compared to the first half of 2020. We sold 20% more tons of potash during the first half of 2021, compared to the first half of 2020, as rising crop prices and the economic rebound from the COVID-19 pandemic created greater demand for potash. Our potash average net realized sales price per ton also increased 17% in the first half of 2021, compared to the first half of 2020, due to multiple price increases announced since the fourth quarter of 2020.

Our Trio® sales increased $8.8 million or 22% during the first half of 2021, compared to the first half of 2020. Our Trio® average net realized sales price per ton increased 26% during the first half of 2021, compared to the first half of 2020, due to multiple price increases announced since the fourth quarter of 2020. We sold 4% more tons of Trio® in the first half of 2021, as strong domestic demand was partially offset by selling fewer tons in the international market.

Our water sales, excluding byproduct water sales, decreased $3.6 million, or 41%, in the first half of 2021, compared to the first half of 2020. Strong water sales during the first quarter of 2020 declined substantially beginning in April 2020 due to the COVID-19 pandemic and related governmental control measures that were implemented. With the easing to varying degrees of the control measures implemented, oil and gas activities near our facilities in New Mexico have increased, but were still below pre-pandemic levels for most of the first half of 2021. Also, a higher percentage of our total water sales for the six months ended June 30, 2021, was byproduct water as compared to same period in 2020.

Our sales of other oilfield solution segment offerings, including caliche, brine water, right-of-way agreements, surface damages and easements, increased $0.4 million, or 26% in the first half of 2021, compared to the first half of 2020, driven by a $0.6 million increase in produced water royalties as operators have increased fracking activities near our facilities in New Mexico as the economy rebounds from the COVID-19 pandemic, partially offset by a decrease in caliche sales.

Our total byproduct sales increased $3.6 million, or 41%, for the six months ended June 30, 2021, compared to the first six months of June 30, 2020, as our byproduct magnesium chloride sales increased $2.2 million, or 128%, our byproduct water sales increased $0.8 million, or 35%, our byproduct salt sales increased $0.4 million, or 9%, and our byproduct brine water sales increased $0.2 million, or 29%. Our byproduct magnesium chloride sales increased as we had more product to sell during 2021 compared to 2020. Our byproduct water sales increased as a higher percentage of our total water sales were byproduct

Table of Contents

water sales. Our brine water sales increased as oilfield activities have increased with the economic recovery after the COVID-19 pandemic.

Cost of Goods Sold

Our cost of goods sold increased $11.8 million, or 15%, during the first half of 2021 compared to the first half of 2020. Our potash cost of goods sold increased $9.5 million, or 24%, during the first half of 2021, compared to the first half of 2020, as we sold 20% more tons of potash. Our Trio® cost of goods sold increased $1.2 million, or 4%, during the first half of 2021, compared to the first half of 2020, as we sold 4% more tons of Trio®.

Our oilfield solutions cost of goods sold increased $1.1 million, or 23% during the first half of 2021, compared to the first half of 2020, due mainly to increased third-party water purchases during the first quarter of 2021 to meet the significant daily refresh rates for certain ~~fracs~~frac jobs on our South ranch. During the first quarter of 2021, we sold a majority of our water from water rights on our South ranch, while in the first quarter of 2020, we sold a majority of our water from our Pecos and Caprock water rights. Our water sales from our South ranch water rights generally carry a higher cost of goods sold as compared to sales from our Pecos and Caprock water rights.

Gross Margin

During the first ~~quarter~~half of 2021, we generated a gross margin of ~~$9.1~~$23.3 million compared to a gross margin of ~~$5.6~~$5.0 million ~~during~~for the first ~~quarter~~half of 2020, ~~due to the factors~~driven by a 26% increase in total sales, partially offset by a 15% increase in our total cost of goods sold, as discussed above.

~~Selling and Administrative Expense~~

During the first quarter of 2021, our selling and administrative expenses decreased $0.8 million, or 12%, as compared to the first quarter of 2020. The decrease was due mainly to increased legal costs incurred in the first quarter of 2020 related to the Mosaic litigation.

Gain on Sale of an Asset

In May 2021, we sold 326 acres of land in Texas for $6.0 million and recognized a gain on the sale of the land of $2.8 million. We purchased this land in May 2019 for the development of a produced water disposal facility and had permitted two disposal wells on the property. Unlike the strategic land sale completed in March 2020 discussed below, we did not include any restrictions on the buyer of this land.

In March 2020, we sold approximately 320 acres of fee land from our Intrepid South property for $4.8 million and recognized a gain on the sale of the land of $4.7 million. The terms of the sale were highly restrictive and only allow the buyer to drill ~~Acid Gas Injection (AGI)~~AGI wells on the property to dispose of natural gas with high concentrations of ~~hydrogen sulfide (H~~H2~~S).~~S. No water rights were included in the land sale, we retained surface access, and we restricted the use of caliche located on the property to the acreage that was sold in order to prevent sales to third parties or decrease future sales to the buyer. ~~Due to the~~Our long-term strategic ~~location of~~operating plan for Intrepid South ~~part of our long-term operating strategy is~~includes selling small parcels of land ~~including restricted use agreements of surface or subsurface rights,~~ to ~~customers,~~other companies, where such sales provide a solution to a ~~customer's operations in the oil and gas industry.~~company's needs. We may have additional strategic sales of small parcels of land in the future.

Gain on Extinguishment of Debt

We recognized a gain of $10.1 million related to the forgiveness of the $10 million PPP loan and the associated accrued interest on the loan, as discussed above.

Litigation Settlement

In March 2020, we reached an agreement with Mosaic to settle ongoing litigation. As part of the ~~first quarter of 2020,~~matter we paid Mosaic an aggregate of $10 million to dismiss all claims against ~~us. We did not incur any litigation settlement costs during the first quarter of 2021.~~us in this litigation.

~~Interest~~Selling and Administrative Expense

During the first ~~quarter~~half of 2021, ~~our interest expense~~selling and administrative expenses decreased ~~$0.4 million~~7% as compared to the first ~~quarter~~half of 2020. We incurred more legal expenses in the first half of 2020 ~~due~~related to the ~~retirement at maturity~~settlement of ~~our Series A Notes in April 2020 and the early repayment of our Series C Notes in July 2020.~~ongoing litigation discussed above.

Net Income

We generated net income of ~~$2.5~~$22.0 million for the ~~three~~six months ended ~~March 31,~~June 30, 2021, as compared to a net loss of ~~$7.4~~$16.3 million infor the ~~same period in~~six months ended June 30, 2020, due to the factors discussed above.

Table of Contents

Potash Segment


		Three Months Ended March 31,				Three Months Ended June 30,				Six Months Ended June 30,
(in thousands, except per ton amounts)	(in thousands, except per ton amounts)	2021		2020			(in thousands, except per ton amounts)	2021		2020		2021		2020
Sales1	Sales1	$	43,578	$	33,791		Sales1	$	37,693	$	24,526	$	81,270	$	58,317
Less: Freight costs	Less: Freight costs	5,700		5,441			Less: Freight costs	4,138		3,286		9,838		8,727
Warehousing and handling costs	Warehousing and handling costs	1,456		1,296			Warehousing and handling costs	1,306		1,204		2,762		2,500
Cost of goods sold	Cost of goods sold	27,749		22,720			Cost of goods sold	22,118		17,650		49,867		40,370

Lower of cost or net realizable value inventory adjustments							Lower of cost or net realizable value inventory adjustments	—		371		—		371

Gross Margin	Gross Margin	$	8,673	$	4,334		Gross Margin	$	10,131	$	2,015	$	18,803	$	6,349
Depreciation, depletion, and amortization incurred2	Depreciation, depletion, and amortization incurred2	$	7,178	$	7,312		Depreciation, depletion, and amortization incurred2	$	6,460	$	5,742	$	13,637	$	13,054

Potash sales volumes (in tons)	Potash sales volumes (in tons)	117		99			Potash sales volumes (in tons)	92		74		208		173
Potash production volumes (in tons)	Potash production volumes (in tons)	113		137			Potash production volumes (in tons)	51		4		164		140

Average potash net realized sales price per ton3	Average potash net realized sales price per ton3	$	282	$	255		Average potash net realized sales price per ton3	$	319	$	256	$	300	$	256

1 Sales include sales of byproducts which were ~~$5.8~~$4.8 million and ~~$4.0~~$3.0 million for the three months ended ~~March 31,~~June 30, 2021, and 2020, respectively, and $10.6 million and $7.0 million for the six months ended June 30, 2021, and 2020, respectively.

2 Depreciation, depletion, and amortization incurred excludes depreciation, depletion, and amortization amounts absorbed in or (relieved from) inventory.

3Average net realized per ton sales price per ton is a non-GAAP financial measure. More information about this measure is below under the heading "Non-GAAP Financial Measure."

Three Months Ended ~~March 31,~~June 30, 2021, and 2020

Potash segment sales in the ~~first~~second quarter of 2021 increased 54% compared to the same period in 2020, due to ~~an 18%~~a 24% increase in sales volume, ~~an 11%~~a 25% increase in our average net realized sales price per ton, and a $1.8 million increase in byproduct sales. Agricultural sales volumes increased in the ~~first~~second quarter of 2021, compared to the ~~first~~second quarter of 2020, as ~~good weather and~~ strong commodity prices ~~spurred very strong early season demand for fertilizer.~~and the economic rebound from the COVID-19 pandemic drove an increase in potash demand. Our industrial potash sales ~~were negatively impacted by~~also increased due to the economic rebound from the COVID-19 ~~pandemic and the resulting decrease in oil and gas activity.~~pandemic. Average net realized sales price per ton was higher due to several price increases announced insince the fourth quarter of ~~2020 and the first quarter of 2021. Magnesium~~2020. Byproduct magnesium chloride sales improved ~~$1.3~~$0.9 million compared to the ~~first~~second quarter of 2020 as we had more product to sell in 2021 due to good evaporation during the summer of ~~2020 improved product availability~~2020. Byproduct water sales increased $0.4 million compared to the ~~prior year in which production was significantly reduced due~~second quarter of 2020 as a higher percentage of our total water sales were sales of byproduct water. Byproduct salt and byproduct brine water sales increased $0.3 million and $0.2 million, respectively, compared to ~~wet weather during~~ the ~~2019 evaporation season.~~second quarter of 2020.

Potash segment freight expense increased ~~$0.3~~$0.9 million, or 5%26%, in the ~~first~~second quarter of 2021, compared to the ~~first~~second quarter of 2020 as a result of ~~increased sales volume of potash.~~a 24% increase in potash tons sold. Our freight expense is impacted by the geographic distribution of our potash and byproduct sales and by the proportion of customers arranging for and paying their own freight costs.

Our potash segment cost of goods sold increased ~~22%~~25% in the ~~first~~second quarter of 2021, compared to the same period in 2020, due to ~~an 18%~~a 24% increase in potash ~~sales volume.~~tons sold.

Potash production ~~decreased 18%~~during the second quarter of 2021, increased compared to the ~~first~~second quarter of 2020, ~~due to lower brine grade at our HB facility and reduced run days at our Moab plant~~ as we had increased ~~salt production to meet first quarter demand.~~pond inventory in 2021 as a result of an improved 2020 evaporation season.

Our potash segment gross margin increased ~~$4.3~~$8.1 million in the second quarter of 2021, compared to the same period in 2020, due to the factors discussed above.

Six Months Ended June 30, 2021, and 2020

Potash segment sales for the six months ended June 30, 2021 increased compared to the same period in 2020, due to a 20% increase in sales volume, a 17% increase in our average net realized sales price per ton, and a $3.6 million increase in byproduct sales. Agricultural sales volume increased 26% as strong commodity prices and the economic rebound from the COVID-19 pandemic drove an increase in potash demand. Industrial potash sales, which improved during the second quarter of 2021, were still lower for the six months ended June 30, 2021, compared to the same period in 2020, as industrial potash sales in the first three months of 2021 were negatively impacted by the lingering economic effects from the COVID-19

Table of Contents

pandemic. Average net realized sales price per ton was higher due to price increases announced since December 2020. Byproduct sales increased $3.6 million due to the economic rebound from the COVID-19 pandemic.

Potash segment freight expense increased $1.1 million, or 13%, in the first six months of 2021, compared to the first six months of 2020 as a result of a 20% increase in sales volume. Our freight expense is impacted by the geographic distribution of our potash and byproduct sales and by the proportion of customers arranging for and paying their own freight costs.

Our potash segment cost of goods sold increased $9.5 million, or 24%, compared to the prior year due to the 20% increase in sales volume in 2021.

Potash production increased 17% in the first six months of 2021 compared to the first six months of 2020 due to improved evaporation during the 2020 evaporation season.

Our potash segment gross margin increased $12.5 million in the first ~~quarter~~six months of 2021, compared to the same period in 2020, due to the factors discussed above.

Additional Information Relating to Potash

The table below shows our potash sales mix for the three and ~~nine~~six months ended ~~March 31,~~June 30, 2021, and 2020:


		Three Months Ended March 31,		Three Months Ended June 30,			Six Months Ended June 30,
		2021	2020			2021	2020	2021	2020
Agricultural	Agricultural	86%	81%		Agricultural	81%	78%	83%	80%
Industrial	Industrial	2%	5%		Industrial	5%	3%	4%	4%
Feed	Feed	12%	14%		Feed	14%	19%	13%	16%

2832

Table of Contents

Trio® Segment


		Three Months Ended March 31,				Three Months Ended June 30,				Six Months Ended June 30,
(in thousands, except per ton amounts)	(in thousands, except per ton amounts)	2021		2020			(in thousands, except per ton amounts)	2021		2020		2021		2020
Sales1	Sales1	$	23,694	$	22,581		Sales1	$	26,924	$	19,251	$	50,619	$	41,832
Less: Freight costs	Less: Freight costs	6,440		6,548			Less: Freight costs	6,037		5,523		12,477		12,071
Warehousing and handling costs	Warehousing and handling costs	1,176		1,608			Warehousing and handling costs	1,072		861		2,248		2,469
Cost of goods sold	Cost of goods sold	16,148		17,430			Cost of goods sold	16,653		14,222		32,801		31,652
Lower of cost or net realizable value inventory adjustments	Lower of cost or net realizable value inventory adjustments	—		550			Lower of cost or net realizable value inventory adjustments	—		1,870		—		2,420

Gross (Deficit) Margin		$	(70)	$	(3,555)
Gross Margin (Deficit)							Gross Margin (Deficit)	$	3,162	$	(3,225)	$	3,093	$	(6,780)
Depreciation, depletion, and amortization incurred2	Depreciation, depletion, and amortization incurred2	$	1,507	$	1,508		Depreciation, depletion, and amortization incurred2	$	1,376	$	1,516	$	2,883	$	3,025

Sales volumes (in tons)	Sales volumes (in tons)	69		76			Sales volumes (in tons)	75		64		145		140
Production volumes (in tons)	Production volumes (in tons)	56		50			Production volumes (in tons)	63		50		119		100

Average Trio® net realized sales price per ton3	Average Trio® net realized sales price per ton3	$	233	$	193		Average Trio® net realized sales price per ton3	$	271	$	208	$	251	$	200

1 Sales include sales of byproducts which were ~~$1.2~~$0.6 million and ~~$1.4~~$0.4 million for the three months ended ~~March 31,~~June 30, 2021, and 2020, ~~respectively.~~respectively, and $1.8 million for both the six months ended June 30, 2021, and 2020.

2 Depreciation, depletion, and amortization incurred excludes depreciation, depletion, and amortization amounts absorbed in or (relieved from) inventory.

3Average net realized per ton sales price per ton is a non-GAAP financial measure. More information about this measure, is below under the heading "Non-GAAP Financial Measure."

Three Months Ended ~~March 31,~~June 30, 2021, and 2020

Trio® segment sales increased 5%40% for the three months ended ~~March 31,~~June 30, 2021, as compared to the same period in 2020. The increase was primarily due to a ~~21%~~30% increase in average net realized sales price per ton, ~~partially offset by~~coupled with a ~~9% decrease~~17% increase in Trio® tons sold. Sales volumes ~~decreased~~increased as ~~we continued to sell fewer tons into international markets as we focus on~~strong commodity prices and the ~~higher priced domestic market.~~economic rebound from the COVID-19 pandemic drove an increase in demand for Trio®. Our Trio® average net realized sales price per ton increased due to ~~higher pricing~~the price increases announced ~~during~~since the fourth quarter of ~~2020 and the first quarter of 2021 and a decrease in international sales which generally have a lower net realized sales price per ton.~~2020.

Trio® freight costs ~~decreased 2%~~increased 9% in the ~~first~~second quarter of 2021, compared to the ~~first~~second quarter of 2020, due to the ~~decrease~~increase in total sales volumes. Our freight expense is impacted by the geographic distribution of our Trio® sales and by the proportion of customers arranging for and paying their own freight costs.

Our Trio® cost of goods sold ~~decreased 7%~~increased 17% in the ~~first~~second quarter of 2021, compared to the ~~first~~second quarter of 2020, due mainly to a ~~9% decrease~~17% increase in sales volumes.

In the first quarter of 2020, we recorded a $0.6 million lower of cost or net realizable value of inventory adjustments due to reduced production rates that increased our per-ton cost of production combined with lower overall price levels.

Our Trio® production volume increased ~~12%~~26% in the ~~first~~second quarter of 2021, compared to the ~~first~~second quarter of 2020, as we converted more tons of work-in-process inventory to premium Trio®.

Our Trio® segment generated a ~~negative~~ gross margin of ~~$0.1~~$3.2 million in the ~~first~~second quarter of 2021, compared to a negative gross margin of ~~$3.6~~$3.2 million in the ~~first~~second quarter of 2020, due to the factors discussed ~~above.~~above, and in the second quarter of 2020, we recorded a $1.9 million lower of cost or net realizable value inventory adjustment.

Six Months Ended June 30, 2021, and 2020

Trio® segment sales increased 21% for the six months ended June 30, 2021, as compared to the same period in 2019. The increase was primarily due to a 26% increase in Trio® average net realized sales price per ton combined with a 4% increase in Trio® tons sold. Our Trio® average net realized sales price per ton increased due to the price increases announced since the fourth quarter of 2020. Sales volumes increased as strong commodity prices and the economic rebound from the COVID-19 pandemic drove an increase in demand for Trio®.

Trio® freight costs increased 3% in the first six months of 2021, compared to the first six months of 2020, due to the 4% increase in Trio® tons sold . Our freight expense is impacted by the geographic distribution of our Trio® sales and by the proportion of customers arranging for and paying their own freight costs.

Our Trio® cost of goods sold increased 4% in the first six months of 2021, compared to the first six months of as Trio® sales volume increased 4%.

Table of Contents

Our Trio® production volume increased 19% compared to the first six months of 2020, as we converted more work-in-process inventory to premium Trio®.

Our Trio® segment generated a gross margin of $3.1 million in the first six months of 2021, compared to a negative gross margin of $6.8 million in the first six months of 2020, due to the factors discussed above, and we recorded a $2.4 million lower of cost or net realizable value inventory adjustment in the first six months of 2020.

Additional Information Relating to Trio®

The table below shows the percentage of Trio® tons sold into the domestic and export ~~market decreased~~markets during the three and six months ended ~~March 31,~~June 30, 2021, and 2020. Our percentage of Trio® tons sold internationally decreased for the six months ended June 30, 2021, as compared to the same period in 2020, as we continued to focus on the domestic Trio® market.


	United States	Export
For the Three Months Ended June 30 2021	94%	6%
For the Six Months Ended June 30, 2021	94%	6%

For the Three Months Ended June 30, 2020	97%	3%
For the Six Months Ended June 30, 2020	83%	17%

Oilfield Solutions Segment


	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands)	2021		2020		2021		2020
Sales	$	3,331	$	2,747	$	7,584	$	10,488


Cost of goods sold	2,425		2,136		6,173		5,033


Gross Margin	$	906	$	611	$	1,411	$	5,455
Depreciation, depletion, and amortization incurred	$	700	$	657	$	1,388	$	1,289

Three Months Ended June 30, 2021, and 2020

Our oilfield solutions segment sales increased $0.6 million in the second quarter of 2021, compared to the same period in 2020, due to ~~our increased focus on domestic shipments~~a $0.5 million increase in surface use, right-of way and ~~variability~~easement revenues and a $0.3 million increase in ~~the timing of shipments to international customers.~~

United States Export
For the Three Months Ended March 31 2021 94% 6%
For the Three Months Ended March 31, 2020 70% 30%

~~Table of Contents~~

~~Oilfield Solutions Segment~~

Three Months Ended March 31,
(in thousands) 2021 2020
Sales $ 4,253 $ 7,741
Cost of goods sold 3,748 2,897
Gross Margin $ 505 $ 4,844
Depreciation, depletion, and amortization incurred $ 688 $ 632

~~Three Months Ended March 31, 2021, and 2020~~

~~Our oilfield solutions segment sales decreased $3.5 million in the first quarter of 2021, compared to the same period in 2020, mainly due to~~produced water royalties, partially offset by a ~~$3.3~~$0.2 million decrease in water sales. Our oilfield solutions ~~water sales and~~segment sales of other ~~oilfield~~ products and services ~~decreased as~~increased due to the economic rebound from the COVID-19 pandemic ~~reduced~~during the second quarter of 2021. Our water sales recorded in the oilfield ~~activity from year-ago levels.~~solutions segment decreased as a higher percentage of our total water sales during the second quarter of 2021 was byproduct water sales. Water that we sell that was used in the production of potash and Trio® is accounted for as byproduct water sales in the potash or Trio® segments.

Cost of goods sold increased ~~29%~~14%, or ~~$0.9~~$0.3 million for the three months ended ~~March 31,~~June 30, 2021, compared to the three months ended ~~March 31,~~June 30, 2020, primarily a result of increased electrical and rental costs.

Gross margin for the three months ended June 30, 2021, increased $0.3 million compared to the prior year, due to the factors discussed above.

Six Months Ended June 30, 2021, and 2020

Our oilfield solutions segment sales decreased $2.9 million during the six months ended June 30, 2021, compared to the same period in 2020, due to a $3.6 million decrease in water sales, partially offset by a $0.6 million increase in produced water royalty revenues and a $0.2 million increase in surface use, right-of way and easement revenues. Our water sales recorded in the oilfield solutions segment decreased due to the negative economic effects during the first three months of 2021 from the COVID-19 pandemic. We saw an economic rebound from the COVID-19 pandemic during the second quarter of 2021 and we expect our oilfield solutions water sales to improve during the second half of 2021. Our oilfield solutions sales of other oilfield products and services increased due to the economic rebound during the second quarter of 2021.

Our cost of goods sold increased 23%, or $1.1 million for the six months ended June 30, 2021, compared to the six months ended June 30, 2020, primarily a result of increased third-party water purchases to meet the significant daily refresh rates for certain fracs on our South ranch. During the first quarter of 2021, we sold a majority of our water from water rights on our South ranch, while in the first quarter of 2020 we sold a majority of our water from our Pecos and Caprock water rights. Our water sales from our South ranch water rights generally carry a higher cost of goods sold as compared to sales from our Pecos and Caprock water rights.

Gross margin for the ~~three~~six months ended ~~March 31,~~June 30, 2021, decreased ~~$4.3~~$4.0 million compared to the prior year, due to the factors discussed above.

Table of Contents

Specific Factors Affecting Our Results

Sales

Our gross sales are derived from the sales of potash, Trio®, water, salt, magnesium chloride, brine water and various other products and services offered to oil and gas producers. Total sales are determined by the quantities of product we sell and the sales prices we realize. For potash, Trio® and salt, we quote prices to customers both on a delivered basis and on the basis of pick-up at our plants and warehouses. ~~Freight~~We incur freight costs ~~are incurred~~ on most of our potash, Trio® and salt sales, but some customers arrange and pay for their own freight directly. When we arrange and pay for freight, our quotes and billings are based on expected freight costs to the points of delivery. When we calculate our potash and Trio® average net realized sales price per ton, we deduct any freight costs included in sales before dividing by the number of tons sold. We believe the deduction of freight costs provides a more representative measure of our performance in the market due to variations caused by ongoing changes in the proportion of customers paying for their own freight, the geographic distribution of our products, and freight rates. Freight rates have been increasing, and if we are unable to pass the increased freight costs on to the customer, our average net realized sales price per ton is negatively affected. We manage our sales and marketing operations centrally and we work to achieve the highest average net realized sales price per ton we can by evaluating the product needs of our customers and associated logistics and then determining which of our production facilities can best satisfy these needs.

The volume of product we sell is determined by demand for our products and by our production capabilities. We operate our potash and Trio® facilities at production levels that approximate expected demand and take into account current inventory levels and expect to continue to do so for the foreseeable future.

Our water sales and other products and services offered through our oilfield solutions segment are driven by demand from oil and gas exploration companies drilling in the Permian Basin. As such, demand for our water is generally stronger during a cyclical expansion of oil and gas drilling. Likewise, a cyclical contraction of oil and gas drilling may decrease demand for our water and the other products and services offered through our oilfield solutions segment. The COVID-19 pandemic ~~has~~ caused an unprecedented decrease in the demand for oil, resulting in lower prices and significant decreases in oil and gas activity, and our total water sales, including byproduct water sales, decreased ~~35%~~25% in the first six months of 2021 compared to the first six months of 2020 because total water sales during the first three months of 2020 were not affected by the COVID-19 pandemic. We have seen an economic rebound from the COVID-19 pandemic during the second quarter of 2021, and our total water sales, including byproduct water sales, increased 11% in the second quarter of 2021, compared to the ~~first~~second quarter of 2020. Rig counts, oil pricing, and oilfield activity have increased from the summer of 2020 and we expect oilfield activity will continue to improve asin the ~~year continues,~~second half of 2021, although economic uncertainty and the potential for future restrictions enacted by state and local governments resulting from the COVID-19 pandemic may negatively impact oilfield activity.

~~Table of Contents~~

Cost of Goods Sold

Our cost of goods sold reflects the costs to produce our products. Many of our production costs are largely fixed and, consequently, our cost of sales per ton on a facility-by-facility basis tends to move inversely with the number of tons we produce, within the context of normal production levels. Our principal production costs include labor and employee benefits, maintenance materials, contract labor, and materials for operating or maintenance projects, natural gas, electricity, operating supplies, chemicals, depreciation and depletion, royalties, and leasing costs. There are elements of our cost structure associated with contract labor, consumable operating supplies, reagents, and royalties that are variable, which make up a smaller component of our cost base. Our costs often vary from period to period based on the fluctuation of inventory, sales, and production levels at our facilities.

Our production costs per ton are also impacted when our production levels change, due to factors such as changes in the grade of ore delivered to the plant, levels of mine development, plant operating performance, and downtime. We expect that our labor and contract labor costs in Carlsbad, New Mexico, will continue to be influenced most directly by the demand for labor in the local region where we compete for labor with another fertilizer company, companies in the oil and gas industry, and a nuclear waste processing and storage facility.

We pay royalties to federal, state, and private lessors under our mineral leases. These payments typically equal a percentage of sales (less freight) of minerals extracted and sold under the applicable lease. In some cases, federal royalties for potash are paid on a sliding scale that vary with the grade of ore extracted. For the three and six months ended ~~March 31,~~June 30, 2021, our average royalty rate was 4.6% and 4.7%, respectively. For the three and six months ended June 30, 2020, our average royalty rate was ~~4.9% and~~ 4.4%~~, respectively.~~.

Income Taxes

We are subject to federal and state income taxes on our taxable income. Our effective tax rate for the ~~three~~six months ended ~~March 31,~~June 30, 2021 and 2020, was zero percent. Our effective tax rate differed from the statutory rate during each period primarily due to the valuation allowance established to offset our deferred tax assets.

Table of Contents

Our federal and state income tax returns are subject to examination by federal and state tax authorities.

For the ~~three~~six months ended ~~March 31,~~June 30, 2021 we incurred no income tax expense and for the ~~three~~six months ended ~~March 31,~~June 30, 2020 we recognized an immaterial amount of income tax benefit.

We evaluate our deferred tax assets and liabilities each reporting period using the enacted tax rates expected to apply to taxable income in the periods in which the deferred tax liability or asset is expected to be settled or realized. The estimated statutory income tax rates that are applied to our current and deferred income tax calculations are impacted most significantly by the states in which we conduct business. Changing business conditions for normal business transactions and operations, as well as changes to state tax rate and apportionment laws, potentially alter our apportionment of income among the states for income tax purposes. These changes in apportionment laws result in changes in the calculation of our current and deferred income taxes, including the valuation of our deferred tax assets and liabilities. The effects of any such changes are recorded in the period of the adjustment. These adjustments can increase or decrease the net deferred tax asset on our condensed consolidated balance sheet. However, any resulting impact to the deferred tax benefit or deferred tax expense would be offset by a corresponding adjustment to the valuation allowance and would have no income statement effect.

As of ~~March 31,~~June 30, 2021, we were in a near break-even cumulative three-year income position. Additionally, general uncertainty in the business markets we operate makes it difficult to forecast sustained amounts of future income. These circumstances are significant negative evidence when evaluating the realizability of our deferred tax assets. This negative evidence continues to outweigh the positive evidence of profitability in 2018, and 2019, thereby requiring us to maintain the full valuation allowance as of ~~March 31,~~June 30, 2021. However, we continue to evaluate the need to maintain the valuation allowance against the deferred tax assets and to the extent positive evidence trends continue and our future long-term forecasts show sustained profitability, our conclusion regarding the need to maintain a full valuation allowance could change.

3136

Table of Contents

Capital Investments

During the first ~~three~~six months of 2021, cash paid for property, plant, equipment, mineral properties, intangible and other assets was ~~$2.4~~$6.6 million.

We expect to make capital investments in 2021 of ~~$25~~$20 million to ~~$35~~$30 million, although the trajectory of the COVID-19 pandemic and the recent volatility in oil and gas markets make this number difficult to estimate. We anticipate spending approximately $12 million to $15 million on sustaining capital projects in 2021, with the remainder of our estimated spending on opportunity projects. We have significant discretion over our opportunity capital investments in 2021 and we may adjust our investment plans as our expectations for 2021, particularly those expectations affected by the COVID-19 pandemic, change. We anticipate our 2021 operating plans and capital programs will be funded out of operating cash flows and existing cash. We may also use our revolving credit facility, to the extent available, to fund capital investments.

Liquidity and Capital Resources

As of ~~March 31,~~June 30, 2021, we had cash of ~~$36.0~~$53.3 million, compared with cash of $19.5 million at December 31, 2020. In April 2020, we received a $10 million loan under the CARES Act Paycheck Protection Program (the "PPP"). The loan matures on April 18, 2022 and bears interest at a rate of 1% per annum. We were required to begin monthly payments of principal and interest in the amount of $0.6 million in November 2020, but due to extensions of the program and delays in the forgiveness application process, we do not expect to make any payments on the loan until a decision is made on our forgiveness application. We may prepay the loan at any time prior to maturity with no prepayment penalties. We used the funds exclusively for allowed payroll, benefits and other allowed expenses and ~~expect~~in June 2021, we received notice that the ~~majority~~Small Business Administration ("SBA") had remitted funds to our bank to fully repay our PPP loan and accrued interest. Accordingly, we recognized a gain of ~~the loan, if not all, will be forgiven. During the second quarter of 2020, the program was amended~~$10.1 million related to ~~allow borrowers to choose either an eight-week or 24-week period to use~~ the funds. We elected to use the 24-week period, which ended in October 2020. The amount eligible for forgiveness is based on the amount of loan proceeds used by us (during the 24-week period after the lender makes the first disbursement of loan proceeds) for the payment of certain covered costs, including payroll costs (including benefits), subject to certain limitations and reductions in accordance with the CARES Act. We submitted our application for forgiveness of the ~~full $10~~PPP loan and the associated accrued interest on the loan.

In June 2021, we repaid the remaining $15.0 million ~~loan in November 2020. No assurance can be given that we will obtain forgiveness~~ of ~~the loan in whole or in part. In addition, as~~principal outstanding on our Series B Senior Notes along with a ~~borrower that received over $2.0 million, we expect to be subject to an audit to review our eligibility under the PPP. The timing and scope~~make-whole payment of the audit remains unclear and as a result we are not able to forecast when we can expect a decision on loan forgiveness. We do not expect the audit will impact our eligibility for forgiveness under the PPP. The loan contains customary events of default relating to, among other things, payment defaults, making materially false and misleading representations to the lender or breaching the terms of the loan documents.$0.5 million.

Our operations have primarily been funded from cash on hand, cash generated by operations, borrowing under our revolving credit facility, and proceeds from debt and equity offerings. We continue to monitor our future sources and uses of cash and anticipate that we will adjust our capital allocation strategies when, and if, determined by our Board of Directors. We may, at any time we deem conditions favorable, attempt to improve our liquidity position by accessing debt or equity markets in accordance with our existing debt agreements. We also may raise capital in the future through the issuance of additional equity or debt securities, subject to prevailing market conditions. However, there is no assurance that we will be able to successfully raise additional capital on acceptable terms or at all. With our current cash on hand, the remaining availability under our credit facility, ~~the proceeds of our loan pursuant of the Paycheck Protection Program under the CARES Act~~ and ~~with~~the expected cash generated from operations, we believe we have sufficient liquidity to meet our obligations for the next twelve months.

The following summarizes our cash flow activity for the ~~three~~six months ended ~~March 31,~~June 30, 2021, and 2020 (in thousands):

Three Months Ended March 31,
2021 2020
Cash flows provided by operating activities $ 19,109 $ 14,771
Cash flows used in investing activities $ (2,313) $ (924)
Cash flows (used in) provided by financing activities $ (292) $ 9,951


	Six Months Ended June 30,
	2021		2020
Cash flows provided by operating activities	$	51,436	$	23,548
Cash flows used in investing activities	$	(584)	$	(9,359)
Cash flows used in financing activities	$	(17,092)	$	(210)

Operating Activities

Total cash provided by operating activities through ~~March 31,~~June 30, 2021, was ~~$19.1~~$51.4 million, an increase of ~~$4.3~~$27.9 million compared with the first ~~three~~six months of 2020 due to increased potash and Trio® sales.

~~Table of Contents~~

Investing Activities

Total cash used in investing activities ~~increased~~decreased by ~~$1.4~~$8.8 million in the first ~~three~~six months of 2021, compared with the same period in 2020. Cash used for capital investments decreased by ~~$3.3~~$4.0 million compared to the first ~~quarter~~half of 2020 as we continue to prudently ~~manager~~manage cash flow in light of economic uncertainty caused by the COVID-19 pandemic. ~~The~~Proceeds from the sale of assets increased $1.3 million during the first ~~quarter~~half of 2021, driven by the sale of land we owned in Texas for $6.0 million, while in the first half of 2020, ~~also benefited from~~we received $4.8 million in proceeds from a land sale from our Intrepid South ranch.

Table of Contents

Financing Activities

Total cash used in financing activities increased by $10.2 million as we did not make any additional borrowings under our credit facility during the first quarter of 2021, as compared to $10 million in additional borrowings under our credit facility during the first quarter of 2020.

~~Senior Notes—As of March 31, 2021, we had outstanding $15 million of Series B Senior Notes, due on April 14, 2023.~~

~~The agreement governing the Series B Senior Notes contains certain financial covenants, including the following:~~

•~~We are allowed a maximum leverage ratio of 3.5 to 1.0 as of the last day of each quarter, measured based on the previous four quarters. Our leverage ratio as of March 31, 2021, was 2.0 to 1.0.~~

Fixed charge coverage ratio and leverage ratio are calculated in accordance with the agreement governing the Series B Senior Notes, each of which includes earnings before interest, taxes, depreciation and amortization ("EBITDA") as a component. As of March 31, 2021, we were in compliance with all applicable covenants under the Series B Senior Notes.

For the three months ended March 31, 2021, and the three months ended March 31, 2020, the interest rates on the Series B Notes was 4.63%. This rate represents the lowest interest rate available under the Series B Senior Notes. The interest rate may adjust upward if we do not continue to meet certain financial covenants.

We have granted to the collateral agent for the noteholders a first lien on substantially all of our non-current assets and a second lien on substantially all of our current assets. We are required to offer to prepay the Series B Senior Notes with the proceeds of dispositions of certain specified property and with the proceeds of certain equity issuances, as set forth in the agreement governing the Series B Senior Notes. The obligations under the Notes are unconditionally guaranteed by several of our subsidiaries.

~~Our outstanding long-term debt, net, as of March 31, 2021, and December 31, 2020, was as follows (in thousands):~~

The agreement governing our revolving credit facility contains certain financial covenants, including the following:

•We are allowed a maximum leverage ratio of 3.25 to 1.0, calculated as of the last day of each quarter by dividing the difference between total debt outstanding less unrestricted cash by consolidated earnings before interest, taxes, depreciation, and amortization ("Consolidated EBITDA") for the previous four quarters. Because our unrestricted cash balance was greater than our outstanding debt, our leverage ratio as of June 30, 2021, was zero.

We occasionally borrow and repay amounts under the facility for near-term working capital needs or other purposes and may do so in the future. During the three and six months ended ~~March 31,~~June 30, 2021, we made no borrowings and we made no repayments under the facility. As of ~~March 31,~~June 30, 2021, and December 31, 2020, we had $29.8 million of borrowings outstanding and $1 million in outstanding letters of credit under the facility. Including the outstanding letters of credit, we had ~~$35.0~~$44.2 million available to be borrowed under the facility as of ~~March 31,~~June 30, 2021.

As of ~~March 31,~~June 30, 2021, we were in compliance with all applicable covenants under the revolving credit facility.

~~Table of Contents~~

During the ~~three~~six months ended ~~March 31,~~June 30, 2020, we borrowed $10 million under the facility and made no repayments.

In early July 2021 we repaid approximately $19.8 million of borrowings outstanding under the credit facility. As of ~~April 30,~~August 2, 2021, we had ~~$29.8~~$10.0 million of borrowings and $1.0 million in outstanding letters of credit under the facility, and approximately ~~$46.0~~$36.0 million in cash. Including the outstanding letters of credit, we had ~~$35.0~~$64.0 million available to be borrowed under the facility.

PPP Loan—In April 2020, we received a $10 million loan under the ~~Paycheck Protection Program (the "PPP")~~PPP under the CARES Act. The loan matures on April 18, 2022 and bears interest at a rate of 1% per annum. We were required to begin monthly payments of principal and interest in the amount of $0.6 million in November 2020, but due to extensions of the program and delays in the forgiveness application process, we do not expect to make any payments on the loan until a decision is made on our forgiveness application. We may prepay the loan at any time prior to maturity with no prepayment penalties. We used the funds exclusively for allowed payroll and benefits expenses and expect the majority of the loan, if not all, will be forgiven. The loan contains customary events of default relating to, among other things, payment defaults, making materially false and misleading representations to the lender or breaching the terms of the loan documents.

During the second quarter of 2020, the PPP was amended to allow borrowers to choose either an eight-week or 24-week period to use the funds. We elected to use the 24-week period, ended in early October 2020. The amount eligible for forgiveness is based on the amount of loan proceeds used by us (during the 24-week period after the lender makes the first disbursement of loan proceeds) for the payment of certain covered costs, including payroll costs (including benefits), subject to certain limitations and reductions in accordance with the CARES Act. We submitted our application for forgiveness of the full ~~$10 million~~amount of the loan in November 2020. ~~No assurance can be given~~In June 2021, we received notice that the SBA had remitted funds to our bank to fully repay our PPP loan and accrued interest. Accordingly, we ~~will obtain~~recognized a gain of $10.1 million related to the forgiveness of the PPP loan and the associated accrued interest on the loan.

Senior Notes—In June 2021 we repaid the remaining $15.0 million of principal outstanding on our Series B Senior Notes due April 14, 2023 (the "Series B Senior Notes") and satisfied all obligations under the Amended and Restated Note Purchase Agreement, dated as of October 31, 2016, by and among the Company and each of the purchasers named therein (as amended, the "Note Purchase Agreement"). In connection with this repayment, the Company paid in aggregate approximately $15.6 million, which consisted of (i) $15.0 million of remaining aggregate principal amount of Series B Senior Notes, (ii) approximately $0.1 million of accrued interest and (iii) a "make-whole" premium of $0.5 million. As a result of the repayment, the Note Purchase Agreement was terminated.

After the repayment of our Series B Senior Notes and the forgiveness of our PPP loan in ~~whole or in part. In addition,~~June 2021, our long-term debt balance, excluding the advances on our credit facility, was zero. Our outstanding long-term debt, net, excluding the advances on our credit facility, as ~~a borrower that received over $2.0 million, we expect to be subject to an audit to review our eligibility under the PPP. The timing and scope~~ of ~~the audit remains unclear and~~December 31, 2020, was as ~~a result we are not able to forecast when we can expect a decision on loan forgiveness. We do not expect the audit will impact our eligibility for forgiveness under the PPP.~~follows (in thousands):


	December 31, 2020
Notes and Payroll Protection Loan	$	25,000
Less current portion of long-term debt	(10,000)
Less deferred financing costs	(74)
Long-term debt, net	$	14,926

Table of Contents

Off-Balance Sheet Arrangements

As of ~~March 31,~~June 30, 2021, we had no material off-balance sheet arrangements aside from the bonding obligations described in Note 14 to the condensed consolidated financial statements.

Critical Accounting Policies and Estimates

Our Annual Report on Form 10-K for the year ended December 31, 2020, describes the critical accounting policies that affect our more significant judgments and estimates used in the preparation of our consolidated financial statements. We have not made any significant changes to our critical accounting policies since December 31, 2020.

3439

Table of Contents

Non-GAAP Financial Measure

To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, from time to time we use "average net realized sales price per ton," which is a non-GAAP financial measure. This non-GAAP financial measure should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. In addition, because the presentation of this non-GAAP financial measure varies among companies, our presentation of this non-GAAP financial measure may not be comparable to similarly titled measures used by other companies.

We believe average net realized sales price per ton, when used in conjunction with GAAP financial measures, provides useful information to investors for analysis of our business and operating results, enhances the overall understanding of past financial performance and future prospects, and allows for greater transparency with respect to the key metric we use in our financial and operational decision making. We use this non-GAAP financial measure as one of our tools in comparing period-over-period performance on a consistent basis and when planning, forecasting, and analyzing future periods. We believe this non-GAAP financial measure is used by professional research analysts and others in the valuation, comparison, and investment recommendations of companies in the potash mining industry. Many investors use the published research reports of these professional research analysts and others in making investment decisions.

Table of Contents

Average Net Realized Sales Price per Ton

We calculate average net realized sales price per ton for each of potash and Trio®. Average net realized sales price per ton for potash is calculated as potash segment sales less potash segment byproduct sales and potash freight costs and then dividing that difference by the number of tons of potash sold in the period. Likewise, average net realized sales price per ton for Trio® is calculated as Trio® segment sales less Trio® segment byproduct sales and Trio® freight costs and then dividing that difference by Trio® tons sold. We consider average net realized sales price per ton to be useful, and believe it to be useful for investors, because it shows our potash and Trio® average per-ton pricing without the effect of certain transportation and delivery costs. When we arrange transportation and delivery for a customer, we include in revenue and in freight costs the costs associated with transportation and delivery. However, some of our customers arrange for and pay their own transportation and delivery costs, in which case these costs are not included in our revenue and freight costs. We use average net realized sales price per ton as a key performance indicator to analyze potash and Trio® sales and price trends.

Below is a reconciliation of average net realized sales price per ton to the most directly comparable GAAP financial measure for the three and six months ended ~~March 31,~~June 30, 2021, and 2020:


		Three Months Ended March 31,												Three Months Ended June 30,
		2021					2020							2021										2020
(in thousands, except per ton amounts)	(in thousands, except per ton amounts)	Potash		Trio®			Potash			Trio®		(in thousands, except per ton amounts)		Potash					Trio®					Potash					Trio®
Total Segment Sales	Total Segment Sales	$	43,578	$	23,694		$	33,791		$	22,581	Total Segment Sales		$	37,693				$	26,924				$	24,526				$	19,251
Less: Segment byproduct sales	Less: Segment byproduct sales	5,784		1,180			3,973			1,380		Less: Segment byproduct sales		4,812					584					2,977					419
Freight costs	Freight costs	4,809		6,440			4,540			6,534		Freight costs		3,486					6,037					2,600					5,523
Subtotal	Subtotal	$	32,985	$	16,074		$	25,278		$	14,667	Subtotal		$	29,395				$	20,303				$	18,949				$	13,309

Divided by:	Divided by:											Divided by:
Tons sold	Tons sold	117		69			99			76		Tons sold		92					75					74					64
Average net realized sales price per ton	Average net realized sales price per ton	$	282	$	233		$	255		$	193	Average net realized sales price per ton		$	319				$	271				$	256				$	208

						Six Months Ended June 30,
									2021					2020
(in thousands, except per ton amounts)												(in thousands, except per ton amounts)		Potash					Trio®					Potash					Trio®

Total Segment Sales													Total Segment Sales				$	81,270				$	50,619				$	58,317				$	41,832
Less: Segment byproduct sales												Less: Segment byproduct sales				10,595					1,764					6,950					1,799
Freight costs												Freight costs		8,295					12,477					7,140					12,057
Subtotal												Subtotal		$	62,380				$	36,378				$	44,227				$	27,976

Divided by:												Divided by:
Tons sold												Tons sold		208					145					173					140
Average net realized sales price per ton												Average net realized sales price per ton		$	300				$	251				$	256				$	200

3541

Table of Contents

ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Part II, Item 7A., "Quantitative and Qualitative Disclosure About Market Risk," of our Annual Report on Form 10-K for the year ended December 31, 2020, describes our exposure to market risk. There have been no significant changes to our market risk exposure since December 31, 2020.

ITEM 4.CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain "disclosure controls and procedures as defined in Rule 13a-15(e) of the Exchange Act." Our disclosure controls and procedures are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. Our disclosure controls and procedures are also designed to ensure that this information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Under the supervision and with the participation of management, including our principal executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures as of ~~March 31,~~June 30, 2021. Based on this evaluation, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures were effective as of ~~March 31,~~June 30, 2021, at the reasonable assurance level.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the three months ended ~~March 31,~~June 30, 2021, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

Our management, including our principal executive officer and principal financial officer, do not expect that our disclosure controls or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within Intrepid have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

3642

Table of Contents

PART II - OTHER INFORMATION

ITEM 1.LEGAL PROCEEDINGS

For information regarding litigation, other disputes and regulatory proceedings see Part I - Item1. Financial Statements, Note 14 - Commitments and Contingencies.

3743

Table of Contents

ITEM 1A.RISK FACTORS

Our future performance is subject to a variety of risks and uncertainties that could materially and adversely affect our business, financial condition, results of operations, and the trading price of our common stock. These risks and uncertainties are described in Part I, Item 1A. "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2020. There have been no material changes to these risks and uncertainties described in our Annual Report on Form 10-K for the year ended December 31, 2020.

3844

Table of Contents

ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Unregistered Sales of Equity Securities and Use of Proceeds


Issuer Purchases of Equity Securities	Issuer Purchases of Equity Securities						Issuer Purchases of Equity Securities
Period	Period	(a) Total Number of Shares Purchased1	(b) Average Price Paid Per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plan or Programs	Period	(a) Total Number of Shares Purchased1	(b) Average Price Paid Per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plan or Programs
January 1, 2021 through January 31, 2021		—	—		—	N/A
February 1, 2021 through February 28, 2021		—	$	—	—	N/A
March 1, 2021, through March 31, 2021		5,468	$	37.15	—	N/A
April 1, 2021 through April 30, 2021							April 1, 2021 through April 30, 2021	—	—		—	N/A
May 1, 2021 through May 31, 2021							May 1, 2021 through May 31, 2021	—	$	—	—	N/A
June 1, 2021, through June 30, 2021							June 1, 2021, through June 30, 2021	5,766	$	30.49	—	N/A
Total	Total	5,468	$	37.15	—	N/A	Total	5,766	$	30.49	—	N/A

1 Represents shares of common stock withheld by us as payment of withholding taxes due upon the vesting of restricted stock held by our employees.

ITEM 3.DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.MINE SAFETY DISCLOSURES

We are committed to providing a safe and healthy work environment. The objectives of our safety programs are to eliminate workplace accidents and incidents, preserve employee health, and comply with all safety- and health-based regulations. We seek to achieve these objectives by training employees in safe work practices; establishing, following, and improving safety standards; involving employees in safety processes; openly communicating with employees about safety matters; and recording, reporting, and investigating accidents, incidents, and losses to avoid recurrence. As part of our ongoing safety programs, we collaborate with the Mine Safety and Health Administration (“MSHA”) and the New Mexico Bureau of Mine Safety to identify and implement accident prevention techniques and practices.

Our East, West, and North facilities in New Mexico are subject to regulation by MSHA under the Federal Mine Safety and Health Act of 1977 and the New Mexico Bureau of Mine Safety. MSHA inspects these facilities on a regular basis and issues various citations and orders when it believes a violation has occurred under federal law. Exhibit 95.1 to this Quarterly Report on Form 10-Q provides the information concerning mine safety violations and other regulatory matters required by SEC rules. Our Utah and HB facilities are subject to regulation by the Occupational Health and Safety Administration and, therefore, are not required to be included in the information provided in Exhibit 95.1.

ITEM 5.OTHER INFORMATION

None.

3945

Table of Contents

ITEM 6.EXHIBITS


Exhibit No.						Description


3.1						Certificate of Amendment to the Certificate of Incorporation of Intrepid Potash, Inc. (incorporated by reference to Exhibit 3.1 of our current Report on Form 8-K filed on August 14, 2020).

31.1						Certification of Principal Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a), as amended.*

31.2						Certification of Principal Financial Officer pursuant to Rule 13a-14(a) and 15d-14(a), as amended.*

32.1						Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**

32.2						Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**

95.1						Mine Safety Disclosure Exhibit.*

101.INS						XBRL Instance Document.*

101.SCH						XBRL Taxonomy Extension Schema.*

101.CAL						XBRL Extension Calculation Linkbase.*

101.LAB						XBRL Extension Label Linkbase.*

101.PRE						XBRL Extension Presentation Linkbase.*

101.DEF						XBRL Extension Definition Linkbase.*

104						Cover page Interactive Data File (formatted as Inline XBRL and contained in exhibit 101)

* Filed herewith.

** Furnished herewith.

4046

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


						INTREPID POTASH, INC. (Registrant)

Dated: ~~May 4,~~August 3, 2021						/s/ Robert P. Jornayvaz III
						Robert P. Jornayvaz III - Executive Chairman of the Board ~~President,~~ and Chief Executive Officer (Principal Executive Officer)




Dated: ~~May 4,~~August 3, 2021						/s/ Matthew D. Preston
						Matthew D. Preston - Vice President - Finance (Principal Financial Officer and Principal Accounting Officer)

4147















	Three-Month Period Ended March 31, 2021
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
Balance, December 31, 2020	13,049,820	$	13	$	656,837	$	(245,591)	$	411,259



Net income	—	—		—		2,451		2,451
Stock-based compensation	—	—		890		—		890
Exercise of stock options	4,188	—		43		—		43
Vesting of restricted common stock, net of common stock used to fund employee income tax withholding due upon vesting	11,646	—		(204)		—		(204)
Balance, March 31, 2021	13,065,654	$	13	$	657,566	$	(243,140)	$	414,439














	Three-Month Period Ended March 31, 2020
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
Balance, December 31, 2019	12,955,351	$	13	$	653,080	$	(218,437)	$	434,656



Net loss	—	—		—		(7,397)		(7,397)
Stock-based compensation	—	—		1,032		—		1,032

Vesting of restricted common stock, net of common stock used to fund employee income tax withholding due upon vesting	8,999	—		(49)		—		(49)
Balance, March 31, 2020	12,964,350	$	13	$	654,063	$	(225,834)	$	428,242


	United States	Export
For the Three Months Ended March 31 2021	94%	6%
For the Three Months Ended March 31, 2020	70%	30%