Exhibit 10.1

INDEMNIFICATION AGREEMENT

THIS INDEMNIFICATION AGREEMENT, dated as of April       , 2008, is made by and between Intrepid Potash, Inc., a Delaware corporation (the “Company”) and                      (the “Indemnitee”).

RECITALS

A. The Company recognizes that competent and experienced persons are increasingly reluctant to serve or to continue to serve as directors or officers of corporations unless they are protected by comprehensive liability insurance or indemnification, or both, due to increased exposure to litigation costs and risks resulting from their service to such corporations, and due to the fact that the exposure frequently bears no reasonable relationship to the compensation of such directors and officers.

B. The statutes and judicial decisions regarding the duties of directors and officers are often difficult to apply, ambiguous, or conflicting, and therefore fail to provide such directors and officers with adequate, reliable knowledge of legal risks to which they are exposed or information regarding the proper course of action to take.

C. The Company and Indemnitee recognize that plaintiffs often seek damages in such large amounts and the costs of litigation may be so enormous (whether or not the case is meritorious), that the defense and/or settlement of such litigation is often beyond the personal resources of directors and officers.

D. The Company believes that it is unfair for its directors and officers and the directors and officers of its subsidiaries to assume the risk of huge judgments and other expenses which may occur in cases in which the director or officer received no personal profit and in cases where the director or officer was not culpable.

E. The Company, after reasonable investigation, has determined that the liability insurance coverage presently available to the Company or its subsidiaries may be inadequate in certain circumstances to cover all possible exposure for which Indemnitee should be protected. The Company believes that the interests of the Company and its stockholders would best be served by a combination of such insurance and the indemnification by the Company of the directors and officers of the Company.

F. The Company’s Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”) requires the Company to indemnify its directors and officers to the fullest extent permitted by the Delaware General Corporation Law (the “DGCL”). The Certificate of Incorporation expressly provides that the indemnification provisions set forth therein are not exclusive, and contemplates that contracts may be

entered into between the Company and its directors and officers with respect to indemnification.

G. Section 145 of the DGCL (“Section 145”), under which the Company is organized, empowers the Company to indemnify its officers, directors, employees and agents by agreement and to indemnify persons who serve, at the request of the Company, as the directors, officers, employees or agents of other corporations or enterprises, and expressly provides that the indemnification provided by Section 145 is not exclusive.

H. Section 102(b)(7) of the DGCL allows a corporation to include in its certificate of incorporation a provision limiting or eliminating the personal liability of a director for monetary damages in respect of claims by stockholders and corporations for breach of certain fiduciary duties, and the Company has so provided in its Certificate of Incorporation that each director shall be exculpated from such liability to the maximum extent permitted by law.

I. The Board of Directors has determined that contractual indemnification as set forth herein is not only reasonable and prudent but also promotes the best interests of the Company and its stockholders.

J. The Company desires and has requested Indemnitee to serve or continue to serve as a director or officer of the Company and/or one or more subsidiaries of the Company free from undue concern for unwarranted claims for damages arising out of or related to such services to the Company and/or one or more subsidiaries of the Company.

K. Indemnitee is willing to serve, continue to serve or to provide additional service for or on behalf of the Company and/or one or more subsidiaries of the Company on the condition that Indemnitee is furnished the indemnity provided for herein.

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:

1. Right to Indemnification. To the fullest extent permitted by the laws of the State of Delaware:

(a) The Company shall indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made a party to any threatened, pending or completed proceeding (including any investigations) by reason of the fact that Indemnitee is or was or has agreed to serve at the request of the Company as a director, officer, employee or

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agent (which for purposes hereof, shall include a trustee, partner or manager or similar capacity) of the Company, or while serving as a director or officer of the Company, is or was serving or has agreed to serve at the request of the Company as a director, officer, employee or agent (which, for purposes hereof, shall include a trustee, partner or manager or similar capacity) of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, or by reason of any action alleged to have been taken or omitted in such capacity. For the avoidance of doubt, the foregoing indemnification obligation includes, without limitation, claims for monetary damages against Indemnitee in respect of an alleged breach of fiduciary duties, to the fullest extent permitted under Section 102(b)(7) of the DGCL as in existence on the date hereof.

(b) The indemnification provided by this Section 1 shall be from and against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with such proceeding and any appeal therefrom, but shall only be provided if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal proceeding, had no reasonable cause to believe Indemnitee’s conduct was unlawful.

(c) Notwithstanding the foregoing provisions of this Section 1, in the case of any threatened, pending or completed action or suit by or in the right of the Company to procure a judgment in its favor by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or while serving as a director or officer of the Company, is or was serving or has agreed to serve at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, Indemnitee shall be entitled to the rights of indemnification provided for herein in connection with such action or suit if the Indemnitee acted in good faith and in a manner the Indemnitee reasonably believed to be in or not opposed to the best interests of the Company; provided, however, if applicable law so provides, no indemnification shall be made in respect of any such claim, issue or matter as to which Indemnitee shall have been finally adjudged to be liable to the Company unless, and only to the extent that, the Delaware Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for such expenses which the Delaware Court of Chancery or such other court shall deem proper.

(d) The termination of any proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that Indemnitee’s conduct was unlawful. In addition, neither the failure of the party making

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the determination as specified in Section 3 below (the “reviewing party”) to have made a determination as to whether Indemnitee has met any particular standard of conduct or had any particular belief, nor an actual determination by the reviewing party that Indemnitee has not met such standard of conduct or did not have such belief, prior to the commencement of legal proceedings by Indemnitee to secure a judicial determination that Indemnitee should be indemnified under applicable law, shall be a defense in such legal proceedings to Indemnitee’s claim or create a presumption that Indemnitee has not met any particular standard of conduct or did not have any particular belief. In connection with any determination by the reviewing party or otherwise as to whether Indemnitee is entitled to be indemnified hereunder, the burden of proof shall be on the Company to establish by clear and convincing evidence that Indemnitee is not so entitled.

(e) The indemnification and contribution provided for herein will remain in full force and effect regardless of any investigation made by or on behalf of Indemnitee or any officer, director, employee, agent or controlling person of Indemnitee.

2. Successful Defense: Partial Indemnification.

(a) To the extent that Indemnitee has been successful on the merits or otherwise in defense of any proceeding referred to in Section 1 hereof or in defense of any claim, issue or matter therein, Indemnitee shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred in connection therewith. For purposes of this Agreement and without limiting the foregoing, if any proceeding is disposed of, on the merits or otherwise (including a disposition without prejudice), without:

(i) the disposition being adverse to Indemnitee;

(ii) an adjudication that Indemnitee was liable to the Company;

(iii) a plea of guilty or nolo contendere by Indemnitee;

(iv) an adjudication that Indemnitee did not act in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company; and

(v) with respect to any criminal proceeding, an adjudication that Indemnitee had reasonable cause to believe Indemnitee’s conduct was unlawful,

Indemnitee shall be considered for the purposes hereof to have been wholly successful with respect thereto.

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(b) If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of the expenses (including attorneys’ fees), judgments, fines or amounts paid in settlement actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with any proceeding, or in defense of any claim, issue or matter therein, and any appeal therefrom but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such expenses (including attorneys’ fees), judgments, fines or amounts paid in settlement to which Indemnitee is entitled.

3. Determination That Indemnification Is Proper. Any indemnification hereunder shall (unless otherwise ordered by a court) be made by the Company unless a determination is made that indemnification of such person is not proper in the circumstances because he or she has not met the applicable standard of conduct set forth in Section 1(b) hereof. Any such determination shall be made:

(i) by a majority vote of the directors who are not parties to the proceeding in question (“disinterested directors”), even if less than a quorum;

(ii) by a majority vote of a committee of disinterested directors designated by majority vote of disinterested directors, even if less than a quorum;

(iii) by a majority vote of a quorum of the outstanding shares of stock of all classes entitled to vote on the matter, voting as a single class, which quorum shall consist of stockholders who are not at that time parties to the proceeding in question;

(iv) by independent legal counsel; or

(v) by a court of competent jurisdiction.

4. Advance Payment of Expenses: Notification and Defense of Claim.

(a) Expenses (including attorneys’ fees) incurred by Indemnitee in defending a threatened or pending proceeding, or in connection with an enforcement action pursuant to Section 5(b) or Section 7(b), shall be paid by the Company in advance of the final disposition of such proceeding within twenty (20) days after receipt by the Company of (i) a statement or statements from Indemnitee requesting such advance or advances from time to time, and (ii) an undertaking by or on behalf of Indemnitee to repay such amount or amounts, only if, and to the extent that, it shall ultimately be determined that Indemnitee is not entitled to be indemnified by the Company as authorized by this Agreement or otherwise. Such undertaking shall be accepted without

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reference to the financial ability of Indemnitee to make such repayment. Advances shall be unsecured and interest-free.

(b) Within thirty (30) days after receipt by Indemnitee of notice of the commencement of any proceeding, Indemnitee shall, if a claim thereof is to be made against the Company hereunder, notify the Company of the commencement thereof. The failure to timely notify the Company of the commencement of the proceeding, or Indemnitee’s request for indemnification, will not relieve the Company from any liability that it may have to Indemnitee hereunder, except to the extent the Company is prejudiced in its defense of such proceeding as a result of such failure.

(c) In the event the Company shall be obligated to pay the expenses of Indemnitee with respect to any proceeding, as provided in this Agreement, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel reasonably acceptable to Indemnitee, upon the delivery to Indemnitee of written notice of its election to do so. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same proceeding, provided that:

(i) Indemnitee shall have the right to employ Indemnitee’s own counsel in such proceeding at Indemnitee’s expense; and

(ii) if (A) the employment of counsel by Indemnitee has been previously authorized in writing by the Company, (B) counsel to the Company or Indemnitee shall have reasonably concluded that there may be a conflict of interest or position, or reasonably believes that a conflict is likely to arise, on any significant issue between the Company and Indemnitee in the conduct of any such defense or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then (in each case) the fees and expenses of Indemnitee’s counsel shall be at the expense of the Company, except as otherwise expressly provided by this Agreement.

The Company shall not be entitled, without the consent of Indemnitee, to assume the defense of any claim brought by or in the right of the Company or as to which counsel for the Company or Indemnitee shall have reasonably made the conclusion provided for in clause (B) above.

(d) Notwithstanding any other provision of this Agreement to the contrary, to the extent that Indemnitee is, by reason of Indemnitee’s corporate status with respect to the Company or any corporation, partnership, joint venture, trust, employee benefit plan or other enterprise which Indemnitee is or was serving or has agreed to serve

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at the request of the Company, a witness or otherwise participates in any proceeding at a time when Indemnitee is not a party in the proceeding, the Company shall indemnify Indemnitee against all expenses (including attorneys’ fees) actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith.

5. Procedure for Indemnification.

(a) To obtain indemnification, Indemnitee shall promptly submit to the Company a written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification. The Company shall, promptly upon receipt of such a request for indemnification, advise the Board of Directors in writing that Indemnitee has requested indemnification.

(b) The Company’s determination whether to grant Indemnitee’s indemnification request shall be made promptly, and in any event within 45 days following receipt of a request for indemnification pursuant to Section 5(a). The right to indemnification as granted by Section 1 of this Agreement shall be enforceable by Indemnitee in any court of competent jurisdiction if the Company denies such request, in whole or in part, or fails to respond within such 45-day period. It shall be a defense to any such action (other than an action brought to enforce a claim for the advance of costs, charges and expenses under Section 4 hereof where the required undertaking, if any, has been received by the Company) that Indemnitee has not met the standard of conduct set forth in Section 1 hereof, but the burden of proving such defense by clear and convincing evidence shall be on the Company. Neither the failure of the Company (including its Board of Directors or one of its committees, its independent legal counsel, and its stockholders) to have made a determination prior to the commencement of such action that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct set forth in Section 1 hereof, nor the fact that there has been an actual determination by the Company (including its Board of Directors or one of its committees, its independent legal counsel, and its stockholders) that Indemnitee has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that Indemnitee has or has not met the applicable standard of conduct. The Indemnitee’s expenses (including attorneys’ fees) incurred in connection with successfully establishing Indemnitee’s right to indemnification, in whole or in part, in any such proceeding or otherwise shall also be indemnified by the Company.

(c) The Indemnitee shall be presumed to be entitled to indemnification under this Agreement upon submission of a request for indemnification pursuant to this Section 5, and the Company shall have the burden of proof in overcoming that presumption in reaching a determination contrary to that presumption. Such presumption shall be used as a basis for a determination of entitlement to indemnification unless the Company overcomes such presumption by clear and convincing evidence.

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6. Insurance and Subrogation.

(a) The Company shall purchase and maintain insurance in reasonable amounts from established and reputable insurers on behalf of Indemnitee (which shall include so called “tail” coverage) who is or was or has agreed to serve at the request of the Company as a director or officer of the Company, or is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise against any liability asserted against, and incurred by, Indemnitee or on Indemnitee’s behalf in any such capacity, or arising out of Indemnitee’s status as such, whether or not the Company would have the power to indemnify Indemnitee against such liability under the provisions of this Agreement. If the Company has such insurance in effect at the time the Company receives from Indemnitee any notice of the commencement of a proceeding, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the policy. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policy.

(b) In the event of any payment by the Company under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee with respect to any insurance policy, who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights in accordance with the terms of such insurance policy. The Company shall pay or reimburse all expenses actually and reasonably incurred by Indemnitee in connection with such subrogation.

(c) The Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable hereunder (including, but not limited to, judgments, fines, ERISA excise taxes or penalties, and amounts paid in settlement) if and to the extent that Indemnitee has otherwise actually received such payment under this Agreement or any insurance policy, contract, agreement or otherwise.

7. Limitation on Indemnification. Notwithstanding any other provision herein to the contrary, the Company shall not be obligated pursuant to this Agreement:

(a) Claims Initiated by Indemnitee . To indemnify or advance expenses to Indemnitee with respect to any proceeding (or part thereof) initiated by Indemnitee, except with respect to a proceeding brought to establish or enforce a right to indemnification (which shall be governed by the provisions of Section 7(b) of this Agreement), unless such proceeding (or part thereof) was authorized or consented to by the Board of Directors of the Company.

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(b) Action for Indemnification . To indemnify Indemnitee for any expenses incurred by Indemnitee with respect to any proceeding instituted by Indemnitee to enforce or interpret this Agreement, unless Indemnitee is successful in establishing Indemnitee’s right to indemnification in such proceeding, in whole or in part, or unless and to the extent that the court in such proceeding shall determine that, despite Indemnitee’s failure to establish their right to indemnification, Indemnitee is entitled to indemnity for such expenses; provided, however, that nothing in this Section 7(b) is intended to limit the Company’s obligation with respect to the advancement of expenses to Indemnitee in connection with any such proceeding instituted by Indemnitee to enforce or interpret this Agreement, as provided in Section 4 hereof.

(c) Section 16 Violations . To indemnify Indemnitee on account of any proceeding with respect to which final judgment is rendered against Indemnitee for payment or an accounting of profits arising from the purchase or sale by Indemnitee of securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute.

(d) Certain Settlement Provisions . To indemnify Indemnitee for amounts paid in settlement of any proceeding without the Company’s prior written consent, which shall not be unreasonably withheld. The Company shall not settle any proceeding in any manner that would impose any fine or other obligation on Indemnitee without Indemnitee’s prior written consent, which shall not be unreasonably withheld.

8. Contribution. In order to provide for just and equitable contribution in circumstances in which the indemnification provided for herein is held by a court of competent jurisdiction to be unavailable to Indemnitee in whole or in part, it is agreed that, in such event, the Company shall (whether or not it is jointly liable with Indemnitee or would be joined in any proceeding), to the fullest extent permitted by law, contribute to the payment of Indemnitee’s costs, charges and expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement with respect to any proceeding, whether civil, criminal, administrative or investigative, in an amount that is just and equitable in the circumstances, taking into account, among other things, contributions by other directors and officers of the Company or others pursuant to indemnification agreements or otherwise; provided, that, without limiting the generality of the foregoing, such contribution shall not be required where such holding by the court is due to (i) the failure of Indemnitee to meet the standard of conduct set forth in Section 1 hereof, or (ii) any limitation on indemnification set forth in Section 6(c) or 7 hereof.

9. Non-Exclusivity. The provisions for indemnification and advancement of expenses set forth in this Agreement shall not be deemed exclusive of any other rights which Indemnitee may have under any provision of law, the Company’s Certificate of Incorporation or Bylaws, in any court in which a proceeding is brought, the vote of the Company’s stockholders or disinterested directors, other agreements or otherwise, and

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Indemnitee’s rights hereunder shall continue after Indemnitee has ceased acting as an agent of the Company and shall inure to the benefit of the heirs, executors and administrators of Indemnitee. However, no amendment or alteration of the Company’s Certificate of Incorporation or Bylaws or any other agreement shall adversely affect the rights provided to Indemnitee under this Agreement.

10. Enforcement. The Company shall be precluded from asserting in any judicial proceeding that the procedures and presumptions of this Agreement are not valid, binding and enforceable. The Company agrees that its execution of this Agreement shall constitute a stipulation by which it shall be irrevocably bound in any court of competent jurisdiction in which a proceeding by Indemnitee for enforcement of his rights hereunder shall have been commenced, continued or appealed, that its obligations set forth in this Agreement are unique and special, and that failure of the Company to comply with the provisions of this Agreement will cause irreparable and irremediable injury to Indemnitee, for which a remedy at law will be inadequate. As a result, in addition to any other right or remedy Indemnitee may have at law or in equity with respect to breach of this Agreement, Indemnitee shall be entitled to injunctive or mandatory relief directing specific performance by the Company of its obligations under this Agreement.

11. Interpretation of Agreement.

(a) It is understood that the parties hereto intend this Agreement to be interpreted and enforced so as to provide indemnification to Indemnitee to the fullest extent now or hereafter permitted by law, including in those circumstances in which indemnification would otherwise be discretionary.

(b) If the DGCL is amended after adoption of this Agreement to expand further the indemnification permitted to directors or officers, then the Company shall indemnify Indemnitee to the fullest extent permitted by the DGCL, as so amended.

12. No Employment Rights. Nothing in this Agreement is intended to create in Indemnitee any right to employment or continued employment.

13. Survival of Rights.

(a) All agreements and obligations of the Company contained herein shall continue during the period Indemnitee is a director, officer, employee or agent of the Company and shall continue thereafter so long as Indemnitee shall be subject to any possible claim or threatened, pending or completed proceeding by reason of the fact that Indemnitee was serving in the capacity referred to herein.

(b) The Company shall require any successor to the Company (whether direct or indirect, by purchase, merger, consolidation or otherwise) or to all, substantially all or a substantial part of the business and/or assets of the Company, by

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written agreement in form and substance satisfactory to Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.

(c) All of the terms and provisions of this Agreement shall be binding upon, shall inure to the benefit of and shall be enforceable by the parties hereto and their respective successors (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business or assets of the Company), assigns, heirs, executors, administrators and legal representatives.

14. Savings Clause. If any provision or provisions of this Agreement shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify Indemnitee as to costs, charges and expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement with respect to any proceeding, including an action by or in the right of the Company, to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated and to the full extent permitted by applicable law.

15. Certain Definitions. For purposes of this Agreement, the following definitions shall apply:

(a) The term “by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or while serving as a director or officer of the Company, is or was serving or has agreed to serve at the request of the Company as a director, officer employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise” shall be broadly construed and shall include, without limitation, any actual or alleged act or omission to act.

(b) The term “Company” shall include, without limitation and in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, and employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, shall stand in the same position under the provisions of this Agreement with respect to the resulting or surviving corporation as he or she would have with respect to such constituent corporation if its separate existence had continued.

(c) The term “expenses” shall be broadly and reasonably construed and shall include, without limitation, all direct and indirect costs of any type or nature whatsoever (including, without limitation, all attorneys’ fees and related disbursements,

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appeal bonds, other out-of-pocket costs and reasonable compensation for time spent by Indemnitee for which Indemnitee is not otherwise compensated by the Company or any third party, provided that the rate of compensation and estimated time involved is approved by the Board of Directors, which approval shall not be unreasonably withheld), actually and reasonably incurred by Indemnitee in connection with either the investigation, defense or appeal of a proceeding or establishing or enforcing a right to indemnification under this Agreement, Section 145 or otherwise.

(d) The term “independent legal counsel” shall mean an attorney or firm of attorneys, who shall not have otherwise performed services for the Company or any Indemnitee within the last five years (other than with respect to matters concerning the right of any Indemnitee under this Agreement, or of other indemnitees under similar indemnity agreements). Any such independent legal counsel shall be selected by the Board of Directors, unless the Board of Directors shall request that the Indemnitee shall make such selection. The party selecting the independent legal counsel shall promptly provide written notice to the other party of its selection. Within 10 days after receipt of such written notice, Indemnitee or the Company, as the case may be, may, deliver to the Company or the Indemnitee, as the case may be, a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the independent legal counsel so selected does not meet the requirements hereof.

(e) The term “judgments, fines and amounts paid in settlement” shall be broadly construed and shall include, without limitation, all direct and indirect payments of any type or nature whatsoever (including, without limitation, all penalties and amounts required to be forfeited or reimbursed to the Company), as well as any penalties or excise taxes assessed on a person with respect to an employee benefit plan).

(f) The term “not opposed to the best interests of the Company” shall include, without limitation, action taken by a person in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan.

(g) The term “other enterprises” shall include, without limitation, employee benefit plans.

(h) The term “proceeding” shall be broadly construed and shall include, without limitation, the investigation, preparation, prosecution, defense, settlement, arbitration and appeal of, and the giving of testimony in, any threatened, pending or completed claim, action, suit or proceeding, whether civil, criminal, administrative or investigative.

(i) The term “serving at the request of the Company” shall include, without limitation, any service as a director, officer, employee or agent of the Company

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which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries.

16. Notices. Any notice, request or other communication required or permitted to be given to the parties under this Agreement shall be in writing and either delivered in person or sent by telecopy, telex, telegram, overnight mail or courier service, or certified or registered mail, return receipt requested, postage prepaid, to the parties at the following addresses (or at such other addresses for a party as shall be specified by like notice):

If to the Company:

700 17 ^th Street

Suite 1700 Denver CO 80202

Attn: Chief Executive Officer

Facsimile:

With a copy to:

700 17 ^th Street

Suite 1700

Denver CO 80202

Attn: Secretary

Facsimile: ____________________

If to Indemnitee:

__________________________

__________________________

Facsimile:___________________

With a copy to:

__________________________

__________________________

Facsimile: ____________________

17. Entire Agreement. This Agreement and the documents expressly referred to herein constitute the entire agreement between the parties hereto with respect to the matters covered hereby, and any other prior or contemporaneous oral or written understandings or agreements between Indemnitee and the Company or its predecessors with respect to the matters covered hereby are expressly superseded by this Agreement.

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18. Modification and Waiver. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

19. Governing Law. This Agreement shall be governed exclusively by and construed according to the laws of the State of Delaware, as applied to contracts between Delaware residents entered into and to be performed entirely within Delaware. If a court of competent jurisdiction shall make a final determination that the provisions of the law of any state other than Delaware govern indemnification by the Company of its officers and directors, then the indemnification provided under this Agreement shall in all instances be enforceable to the fullest extent permitted under such law, notwithstanding any provision of this Agreement to the contrary.

20. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original and all of which together shall be deemed to be one and the same instrument, notwithstanding that both parties are not signatories to the original or same counterpart.

21. Headings. The section and subsection headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

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IN WITNESS WHEREOF, this Agreement has been duly executed and delivered to be effective as of the date first above written.

Exhibit 10.2

EXCHANGE AGREEMENT

THIS EXCHANGE AGREEMENT dated as of April 21, 2008 (this “ Agreement ”), is between Intrepid Potash, Inc., a Delaware corporation (“ Intrepid Potash ”), and Intrepid Mining LLC, a Delaware limited liability company (“ Intrepid Mining ”). Certain terms used in this Agreement are defined in Section 1.1.

RECITALS

A. Intrepid Potash is contemplating an offer and sale of its Common Stock to the public in an underwritten initial public offering (the “ IPO ”).

B. As of the date hereof, Intrepid Mining owns all 1,000 of the issued and outstanding shares of Common Stock of Intrepid Potash.

C. Intrepid Mining wishes to assign all of its assets (other than cash) to Intrepid Potash, and Intrepid Potash wishes to accept such assignment of assets in exchange for a portion of the net proceeds of the IPO, shares of Intrepid Potash’s Common Stock and the assumption of (i) a portion of Intrepid Mining’s liability under the Credit Agreement (as defined below) and (ii) substantially all other liabilities and obligations of Intrepid Mining, (collectively, the “ Exchange ”).

D. In connection with the Exchange, Intrepid Potash intends to declare a dividend with respect to the 1,000 shares of its Common Stock currently issued and outstanding (the “ Formation Distribution ”), which will be paid in shares of Common Stock; provided, however , that for each share of Common Stock purchased by the underwriters pursuant to the over-allotment option granted in connection with the IPO, the number of shares payable pursuant to the Formation Distribution will be reduced, one-for-one, and in lieu of such shares, Intrepid Potash will pay cash in an amount equal to the net proceeds, before offering expenses but after underwriting discounts and commissions, it receives from the exercise of the underwriters’ over-allotment option.

AGREEMENT

In consideration of the covenants and agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Intrepid Potash and Intrepid Mining agree as follows:

1. Definitions.

1.1 Certain Definitions. For purposes of this Agreement, the following terms shall have the meanings specified in this Section 1.1:

“ Accountants ” means the Denver, Colorado office of a mutually acceptable nationally or regionally recognized firm of independent certified public accountants that has not provided material services to either Intrepid Mining or Intrepid Potash or their respective Affiliates in the preceding three years.

“ Affiliate ” means with respect to any Person, any Person that directly or indirectly, through one or more intermediaries Controls, is Controlled by or is under common Control with such Person.

“ Common Stock ” means the common stock, par value $0.001 per share, of Intrepid Potash.

“ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract or otherwise.

“ Credit Agreement ” means the Third Amended and Restated Credit Agreement dated as of March 9, 2007, by and among Intrepid Mining, Intrepid New Mexico, Intrepid Moab, Intrepid Wendover, U.S. Bank National Association and the lenders named therein, as amended.

“ Fourth Amendment ” means the Fourth Amendment to the Credit Agreement dated as of the Closing Date and among Intrepid Potash, Intrepid Mining, Intrepid New Mexico, Intrepid Moab, Intrepid Wendover, U.S. Bank National Association and the lenders named therein.

“ Income Taxes ” or “ Income Tax ” means any and all federal, state, local, foreign and other Taxes imposed on, or measured by, income, franchise, profits or gross receipts, and includes alternative minimum Taxes and estimated Taxes.

“ Losses ” means any and all losses, claims, fines, penalties, fees, deficiencies, damages, liabilities, joint or several, or Proceedings (whether commenced or threatened) and costs and expenses (including interest, court costs, reasonable fees of attorneys, accountants and other experts, reasonable expenses of investigation, and other expenses of litigation or other proceedings).

“ Person ” means a natural person, corporation, joint venture, partnership, limited liability partnership, limited partnership, limited liability limited partnership, limited liability company, trust, estate, business trust, association, governmental authority or any other entity.

“ Proceeding ” means any action, arbitration, audit, hearing, investigation, litigation, suit, or other proceeding, including those of a judicial, regulatory, governmental entity or agency, or administrative nature.

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“ Tax Return ” means any return, report, exhibit, schedule, information return, or statement and other documentation (including any additional or supporting material, attachment, amendment or supplement thereto) filed or maintained, or required to be filed or maintained, in connection with the calculation, determination, assessment, or collection of any Tax, and shall include an amended return or claim for refund.

“ Taxes ” or “ Tax ” means any and all federal, state, local, foreign and other taxes, levies, fees, imposts and duties of whatever kind (including any interest, penalties or additions to the tax imposed in connection therewith or with respect thereon), including taxes imposed on, or measured by, income, franchise, profits or gross receipts, alternative minimum taxes, estimated taxes and also including ad valorem, value added, sales, use, service, real or personal property, capital stock, business license, payroll, withholding, employment, social security, workers’ compensation, unemployment, severance, production, excise, stamp, occupation, premium, windfall profits, real estate transfer, and customs tariffs, imposts, assessments, obligations, and charges, and including any liability for any of the foregoing items that arises by reason of a contract, assumption, transferee or successor liability, operation of law, or otherwise.

“ Underwriting Agreement ” means the underwriting agreement to be entered into among Intrepid Potash and the managing underwriters for the IPO.

1.2 Additional Terms. In addition to defined terms identified in Section 1.1, the following terms have the meanings assigned in the Sections referred to in the table below:

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2. Exchange Transaction.

2.1 Exchanged Assets. Upon the terms and subject to the conditions contained in this Agreement, at the Closing, Intrepid Mining shall contribute, assign, transfer and convey to Intrepid Potash, and Intrepid Potash shall acquire and accept from Intrepid Mining, all right, title and interest of Intrepid Mining in and to the properties, assets and rights of every nature, kind and description, owned or held, directly or indirectly, by Intrepid Mining, other than the Excluded Assets (the “ Exchanged Assets ”), and subject to the Assumed Liabilities. The Exchanged Assets include the following assets and properties:

(a) all outstanding membership interests of Intrepid Potash – New Mexico, LLC, a New Mexico limited liability company (“ Intrepid New Mexico ”);

(b) all outstanding limited liability company interests of Intrepid Potash – Moab, LLC, a Delaware limited liability company (“ Intrepid Moab ”);

(c) all outstanding membership interests of Intrepid Potash – Wendover, LLC, a Colorado limited liability company (“ Intrepid Wendover ”);

(d) all outstanding membership interests of HB Potash LLC, a New Mexico limited liability company (“ HB Potash ”);

(e) all outstanding membership interests of Moab Gas Pipeline LLC, a Colorado limited liability company (“ Moab Pipeline ”);

(f) all outstanding membership interests of Intrepid Aviation LLC, a Colorado limited liability company (“ Intrepid Aviation ”);

(g) all employees of Intrepid Mining; and

(h) all other assets, property (whether real, personal or mixed, tangible or intangible), leasehold interests, equipment, contract rights, and other rights owned or held by Intrepid Mining, other than the Excluded Assets.

2.2 Excluded Assets. Intrepid Mining will retain ownership of (a) all of its cash as of the Closing Date, (b) any receivable that constitutes a credit in the form of a personal loan to or for any person who is or is expected to become a director or executive officer of Intrepid Potash, (c) the 1,000 shares of Common Stock of Intrepid Potash currently issued and outstanding to Intrepid Mining, (d) all of its rights and interests under this Agreement and any documents and instruments executed and delivered at the Closing pursuant to Section 3.2, and (e) all of its rights and interests in and to any of the Exchange Consideration (the “ Excluded Assets ”).

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2.3 Assumed Liabilities. Subject to the terms and conditions set forth herein, at the Closing, Intrepid Potash shall assume and agree to pay, honor and discharge when due the Assumed Liabilities. “ Assumed Liabilities ” shall mean:

(a) (i) pursuant to the Fourth Amendment, any and all amounts in excess of $18.9 million of the amounts outstanding on the Closing Date under the Credit Agreement, and (ii) the obligation to pay all breakage costs for the termination of any interest rate swaps or hedging agreements (“ Breakage Costs ”) in connection with the repayment of the amounts described in clause “(i)” by Intrepid Potash or the repayment by Intrepid Mining of the amounts described in Section 2.4(a);

(b) any and all liabilities set forth on Intrepid Mining’s Closing Date balance sheet (which balance sheet shall be prepared after the Closing Date by Intrepid Potash in accordance with United States generally accepted accounting principles applied in a manner consistent with the balance sheet of Intrepid Mining included in Intrepid Mining’s financial statements as of and for the year ended December 31, 2007, and shall be provided to Intrepid Mining within 30 days after the Closing Date);

(c) any and all liabilities and obligations existing as of the Closing Date, whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due, including, without limitation, any and all indemnification obligations of Intrepid Mining; and

(d) any and all liabilities and obligations arising after the Closing Date in connection with facts, events, conditions, actions or omissions existing or occurring on or before the Closing Date, whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due.

2.4 Retained Liabilities. Intrepid Potash shall not assume and Intrepid Mining shall promptly satisfy the following liabilities and obligations (the “ Retained Liabilities ”):

(a) pursuant to the Fourth Amendment, $18.9 million outstanding on the Closing Date under the Credit Agreement, together with all unpaid interest accrued thereon and any fees, charges and other costs owed to the lenders under the Credit Agreement with respect thereto (but not any Breakage Costs), and

(b) the liabilities in respect of Taxes retained by Intrepid Mining from and after the Closing pursuant to Article 7.

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2.5 Exchange Consideration. The consideration for the Exchanged Assets (the “ Exchange Consideration ”) shall be:

(a) $757,395,087 in cash (the “ Cash Portion ”);

(b) 40,339,000 shares of Common Stock of Intrepid Potash (the “ Stock Portion ”); and

(c) assumption by Intrepid Potash of the Assumed Liabilities.

3. Closing.

3.1 Time and Place of Closing. The closing (the “ Closing ”) of the transactions contemplated hereby shall be held at the offices of Holme Roberts & Owen LLP, 1700 Lincoln Street, Suite 4100, Denver, Colorado 80203 at the time and date on which all the conditions set forth in Section 4 have been satisfied or waived, or at such later time and date as Intrepid Potash and Intrepid Mining shall agree in writing (such time and date, the “ Closing Date ”).

3.2 Closing Deliverables.

(a) Intrepid Mining shall deliver, or cause to be delivered, the following to Intrepid Potash at Closing:

(i) instruments of transfer conveying the outstanding membership interests of each of Intrepid New Mexico, Intrepid Moab, Intrepid Wendover, HB Potash, Moab Pipeline and Intrepid Aviation;

(ii) an executed copy of the Fourth Amendment;

(iii) all documents, certificates and agreements necessary to transfer the Exchanged Assets to Intrepid Potash, including:

(1) bills of sale, transfers of title, assignments and general conveyances, in form and substance reasonably satisfactory to Intrepid Potash, dated the Closing Date; and

(2) assignments of all contracts, intellectual property, permits and any other agreements and instruments constituting Exchanged Assets, dated the Closing Date, assigning to Intrepid Potash all of Intrepid Mining’s right, title and interest therein and thereto; and

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(iv) such other documents, instruments or certificates, in form and substance reasonably satisfactory to Intrepid Potash, as Intrepid Potash may reasonably request in order to effect and evidence the contribution, assignment, transfer and conveyance of the Exchanged Assets to Intrepid Potash and the other transactions contemplated by this Agreement.

(b) Intrepid Potash shall deliver, or cause to be delivered, the following to Intrepid Mining at Closing:

(i) the Cash Portion of the Exchange Consideration by wire transfer of immediately available funds to an account designated by Intrepid Mining;

(ii) an executed copy of the Fourth Amendment;

(iii) one or more stock certificates in the name of Intrepid Mining representing the Stock Portion of the Exchange Consideration; and

(iv) instruments of assumption and such other documents, in form and substance reasonably satisfactory to Intrepid Mining, as Intrepid Mining may reasonably request in order to effect and evidence Intrepid Potash’s assumption of the Assumed Liabilities and the other transactions contemplated by this Agreement.

4. Conditions to Closing .

4.1 Conditions to the Obligations of All Parties. The obligations of the parties under this Agreement are subject to the fulfillment or waiver of the following conditions:

(a) There shall not have been issued and be in effect any order, decree or judgment of, or in, any court, tribunal of competent jurisdiction or governmental authority which makes the transactions contemplated by this Agreement illegal or invalid; and

(b) Intrepid Potash shall have entered into the Underwriting Agreement with respect to the IPO and all conditions to the consummation thereof shall have been, or will contemporaneously be, satisfied, except for conditions to be satisfied at the Closing under the Underwriting Agreement or this Agreement.

4.2 Condition to Obligations of Intrepid Potash . In addition to the conditions specified in Section 4.1, the obligations of Intrepid Potash under this Agreement are subject to the fulfillment or waiver of the following conditions:

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(a) all covenants, agreements and conditions contained in this Agreement to be performed by Intrepid Mining on or prior to the Closing shall have been performed or complied with in all material respects; and

(b) Intrepid Mining shall have delivered, or caused to be delivered, to Intrepid Potash each of the deliverables identified in Section 3.2(a).

4.3 Conditions to the Obligations of Intrepid Mining. In addition to the conditions specified in Section 4.1, the obligations of Intrepid Mining under this Agreement are subject to the fulfillment or waiver of the following conditions:

(a) all covenants, agreements and conditions contained in this Agreement to be performed by Intrepid Potash on or prior to the Closing shall have been performed or complied with in all material respects; and

(b) Intrepid Potash shall have delivered, or caused to be delivered, to Intrepid Mining each of the deliverables identified in Section 3.2(b).

5. Termination. If the conditions set forth in Section 4 are not satisfied or waived on or before May 25, 2008, or if the registration statement with respect to the IPO is withdrawn for any reason prior to that date, this Agreement shall become null and void and be of no further force or effect whatsoever and neither Intrepid Mining nor Intrepid Potash shall have any further obligations hereunder or with respect hereto.

6. Covenants .

6.1 Intrepid Mining and Intrepid Potash agree (a) to furnish or cause to be furnished, upon request to each other such further information; (b) to execute and deliver to each other such other documents; and (c) to do such other acts and things, all as the other party may reasonably request for the purpose of carrying out the intent of this Agreement. Without limiting the generality of the foregoing, from and after the Closing Date, Intrepid Mining shall promptly remit to Intrepid Potash any funds that are received by Intrepid Mining and that are included in, or that represent payment of receivables included in, the Exchanged Assets.

6.2 Intrepid Mining (a) hereby irrevocably authorizes Intrepid Potash, at all times on and after the Closing Date, to endorse in the name of Intrepid Mining any check or other instrument that is made payable to Intrepid Mining and that represents funds included in, or that represents the payment of any receivable included in, the Exchanged Assets; (b) hereby irrevocably nominates, constitutes and appoints Intrepid Potash as the true and lawful attorney-in-fact of Intrepid Mining (with full power of substitution) effective as of the Closing Date; and (c) hereby authorizes Intrepid Potash, in the name of and on behalf of Intrepid Mining, to execute, deliver, acknowledge, certify, file and record any document, to institute and prosecute any Proceeding and to take any other

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action (on or at any time after the Closing Date) that Intrepid Potash may deem appropriate for the purpose of (i) collecting, asserting, enforcing or perfecting any claim, right or interest of any kind that is included in or relates to any of the Exchanged Assets, (ii) defending or compromising any claim, right, audit, investigation or Proceeding relating to any of the Exchanged Assets, or (iii) otherwise carrying out or facilitating any of the transactions contemplated hereby. The power of attorney referred to in the preceding sentence is and shall be coupled with an interest and shall be irrevocable, and shall survive the dissolution or insolvency of Intrepid Mining.

7. Tax Matters.

7.1 Transfer Taxes . Intrepid Potash shall pay all sales, use, transfer and other similar Taxes and fees (collectively, “ Transfer Taxes ”) arising out of or in connection with the transactions provided for in this Agreement, and all such Transfer Taxes shall constitute Assumed Liabilities from and after the Closing. Intrepid Potash shall prepare (or cause to be prepared) and timely file (or cause to be filed) all necessary documentation and Tax Returns with respect to any such Transfer Taxes.

7.2 Pre-Closing Returns .

(a) Intrepid Mining shall prepare (or cause to be prepared) and timely file (or cause to be filed) all Tax Returns that are required to be filed (giving effect to extensions) by Intrepid Mining or any of Intrepid New Mexico, Intrepid Moab, Intrepid Wendover, HB Potash, Moab Pipeline, or Intrepid Aviation (collectively, the “ Subsidiaries ”) on or before the Closing Date (each a “ Pre-Closing Return ”) and shall timely pay (or cause to be paid) all Taxes shown as due on such Pre-Closing Returns.

(b) All liabilities of Intrepid Mining for Income Taxes that result from or are attributable to the ownership or operations of the Subsidiaries for any taxable period covered by a Pre-Closing Return shall constitute Retained Liabilities from and after the Closing; all other liabilities for Taxes for the taxable periods covered by Pre-Closing Returns and not paid by Intrepid Mining on or before the Closing Date shall constitute Assumed Liabilities from and after the Closing.

(c) Intrepid Mining shall be entitled to receive, credit and apply in its discretion any refund or overpayment with respect to a taxable period covered by a Pre-Closing Return (i) that is received, credited or applied on or before the Closing Date or (ii) that is received, credited or applied after the Closing Date and represents an amount which, if payable as a liability after the Closing, would constitute a Retained Liability. To the extent that Intrepid Mining actually realizes a benefit from a refund or overpayment with respect to a taxable period covered by a Pre-Closing Return that is received, credited or applied after the Closing Date and represents an amount which, if payable as a liability after the Closing, would constitute an Assumed Liability, Intrepid

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Mining shall pay to Intrepid Potash, without interest, the amount of the realized benefit promptly following the date it is realized.

7.3 Mining Post-Closing Returns .

(a) Except as provided in Section 7.1, Intrepid Mining shall prepare (or cause to be prepared) and timely file (or cause to be filed) all Tax Returns that are required to be filed (giving effect to extensions) by Intrepid Mining after the Closing Date (each a “ Mining Post-Closing Return ”) and shall timely pay (or cause to be paid) all Taxes shown as due on such Mining Post-Closing Returns; provided that Intrepid Potash shall reimburse Intrepid Mining (i) for all liabilities of Intrepid Mining and any direct or indirect owner (for Income Tax purposes) of Intrepid Mining for Income Taxes related to a Mining Post-Closing Return that result from or are attributable to the ownership or operation of Exchanged Assets (including the operations of the Subsidiaries) or otherwise with respect to the Assumed Liabilities, to the extent attributable to the portion of any taxable period covered by a Mining Post-Closing Return that begins after the Closing Date (each a “ Potash Post-Closing Income Tax Liability ”) (such liabilities being determined by treating the Closing Date as the end of a taxable period) and (ii) for all Taxes other than Income Taxes shown as due on a Mining Post-Closing Return to the extent that such Taxes other than Income Taxes result from or are attributable to the ownership or operation of Exchanged Assets (including the operations of the Subsidiaries) or otherwise with respect to the Assumed Liabilities, for any taxable period (each a “ Potash Post-Closing Non-Income Tax Liability ”). If Intrepid Mining intends to assert a reimbursement claim against Intrepid Potash for any amount described in clause (i)  or clause (ii)  of the preceding sentence with respect to a Mining Post-Closing Return, then Intrepid Mining shall, at least 45 days prior to the due date (including extensions) of such Mining Post-Closing Return, deliver a copy of the Mining Post-Closing Return to Intrepid Potash, together with a written notice setting forth the due date of such return, an explanation of the basis for the reimbursement, in reasonable detail, and a calculation of the Potash Post-Closing Income Tax Liability and/or the Potash Post-Closing Non-Income Tax Liability, as applicable, and Intrepid Potash shall pay such amount(s) to Intrepid Mining (by wire transfer of immediately available funds) at least 5 days prior to the due date of such return. If Intrepid Potash disputes the amount of the Potash Post-Closing Income Tax Liability and/or the Potash Post-Closing Non-Income Tax Liability with respect to a Mining Post-Closing Return, Intrepid Potash shall notify Intrepid Mining at least 30 days prior to the due date of such return and the parties shall submit the dispute to binding arbitration to be conducted in accordance with the following procedures by the Accountants as the sole arbitrator. Each party shall submit to the Accountants, at least 20 days prior to the due date of the applicable return, its explanation of the basis for the reimbursement, if any, and a calculation of the Potash Post-Closing Income Tax Liability and/or the Potash Post-Closing Non-Income Tax Liability, if any, and shall reasonably cooperate with the Accountants in connection with the arbitration. The Accountants shall use commercially reasonable efforts to render their written

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decision specifically establishing the amount(s) of the Potash Post-Closing Income Tax Liability and/or the Potash Post-Closing Non-Income Tax Liability, as applicable, prior to the due date of the applicable Tax Return, but in all events shall render such decision within 30 days after the parties initiate the arbitration proceeding. The fees and other costs of the arbitration and the reasonable attorney fees, expert witness fees, and costs, if any, of Intrepid Mining shall be borne by Intrepid Potash unless the sum of any Potash Post-Closing Income Tax Liability plus any Potash Post-Closing Non-Income Tax Liability asserted by Intrepid Mining with respect to the Mining Post-Closing Return exceeds the sum of such amounts established by the Accountants by at least 20%, in which case, the fees and other costs of the arbitration and the reasonable attorney fees, expert witness fees, and costs, if any, of Intrepid Potash shall be borne by Intrepid Mining. The Accountants’ decision shall include an award of such fees and costs provided by this Section 7.3(a). The decision may be filed in any court of competent jurisdiction and may be enforced by any party as a final judgment of such court. Without the consent of Intrepid Mining and Intrepid Potash, the arbitration shall not determine any issues other than those set forth in this Section 7.3(a); all other disputes shall be handled pursuant to the provisions of Article 8. For purposes of determining any liability of any direct or indirect owner (for Income Tax purposes) of Intrepid Mining for Income Taxes described in clause (i) above, the tax rate applicable to any income or gain allocable to such direct or indirect owner shall be deemed to be the highest rate applicable to an individual with respect to income or gain of such character in the applicable jurisdiction.

(b) All liabilities of Intrepid Mining and any direct or indirect owner (for Income Tax purposes) of Intrepid Mining for Income Taxes that result from or are attributable to the ownership or operation of Exchanged Assets (including the operations of the Subsidiaries) or otherwise with respect to the Assumed Liabilities, to the extent attributable to the portion of any taxable period covered by a Mining Post-Closing Return that begins after the Closing Date, shall constitute Assumed Liabilities from and after the Closing; all liabilities for Taxes other than Income Taxes that result from or are attributable to the ownership or operation of Exchanged Assets (including the operations of the Subsidiaries) or otherwise with respect to the Assumed Liabilities, to the extent attributable to any taxable period covered by a Mining Post-Closing Return, shall constitute Assumed Liabilities from and after the Closing; and, subject to Section 7.1, all other liabilities with respect to Taxes of the type and for the taxable periods covered by Mining Post-Closing Returns shall constitute Retained Liabilities from and after the Closing.

(c) Intrepid Mining shall be entitled to receive, credit and apply in its discretion any refund or overpayment with respect to a taxable period covered by a Mining Post-Closing Return; provided, however , that to the extent that Intrepid Mining actually realizes a benefit from such a refund or overpayment that represents an amount which, if payable as a liability after the Closing, would constitute an Assumed Liability,

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Intrepid Mining shall pay to Intrepid Potash, without interest, the amount of the realized benefit promptly following the date it is realized.

7.4 Potash Post-Closing Returns . Except with respect to Mining Post-Closing Returns, Intrepid Potash shall prepare (or cause to be prepared) and timely file (or cause to be filed) all Tax Returns that are required to be filed (giving effect to extensions) by the Subsidiaries or with respect to the ownership or operation of Exchanged Assets (including the operations of the Subsidiaries) or otherwise with respect to the Assumed Liabilities, after the Closing Date (each a “ Potash Post-Closing Return ”) and shall timely pay (or cause to be paid) all Taxes shown as due on such Potash Post-Closing Returns.

(a) All liabilities with respect to Taxes of the type and for the taxable periods covered by Potash Post-Closing Returns shall constitute Assumed Liabilities from and after the Closing.

(b) Intrepid Potash shall be entitled to receive, credit and apply in its discretion any refund or overpayment with respect to a period covered by a Potash Post-Closing Return.

7.5 Access to Information and Personnel .

(a) From and after the Closing, Intrepid Potash shall grant (and shall cause its Affiliates to grant) to Intrepid Mining (or Intrepid Mining’s designees) access at all reasonable times to the books and records of, and all other information regarding, the ownership and operation of Exchanged Assets (including the operations of the Subsidiaries) and the Assumed Liabilities, which information is within the possession of Intrepid Potash or the Subsidiaries or their respective Affiliates (including work papers and correspondence with taxing authorities, but excluding work product of and attorney-client communications with any of Intrepid Potash’s legal counsel), and shall afford Intrepid Mining (or Intrepid Mining’s designees) the right (at Intrepid Mining’s expense) to take extracts therefrom and to make copies thereof, to the extent reasonably necessary to permit Intrepid Mining (or Intrepid Mining’s designees) to prepare Tax Returns, to conduct negotiations with Tax authorities, and to implement the provisions of, or to investigate or defend any claims between the parties arising under, this Agreement.

(b) Notwithstanding any provision of this Agreement to the contrary, none of Intrepid Potash, any Affiliate or designee of Intrepid Potash, any of the Accountants, or any arbitrator or other person under this Agreement shall be entitled to any access to (or be permitted to extract or make copies of) any Tax Return or any other information regarding the Taxes or Tax Returns of any direct or indirect owner of Intrepid Mining.

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(c) Intrepid Potash will preserve and retain (or cause to be preserved and retained) all Tax Returns, schedules, work papers, and other documents relating to (i) any Tax Return of a Subsidiary, (ii) any Taxes with respect to the ownership or operation of the Exchanged Assets (including the operations of the Subsidiaries) or otherwise with respect to the Assumed Liabilities, or (iii) any Tax claims, audits, or other proceedings affecting the Exchanged Assets (including the operations of the Subsidiaries) or the Assumed Liabilities, until the later to occur of (x) the seventh anniversary of the Closing Date, (y) the expiration of the statute of limitations (including extensions) applicable to the taxable period to which such documents relate, or (iii) the final determination of any controversy with respect to such taxable period and the final determination of any payment that may be required with respect to such taxable period under this Agreement.

(d) At Intrepid Mining’s request, Intrepid Potash shall provide reasonable access to its and its Affiliates’ (including the Subsidiaries’) personnel who have knowledge of the information described in this Section 7.5, and Intrepid Potash shall reasonably cooperate (and shall cause its Affiliates(including the Subsidiaries) to reasonably cooperate) with Intrepid Mining with respect to the matters covered by this Section 7.6.

7.6 Employment Tax Withholding . Intrepid Potash shall effect all employment-Tax related withholdings in accordance with the Forms W-4 and W-5 transferred by Intrepid Mining to Intrepid Potash with respect to all transferred employees. Intrepid Potash shall report all wages paid and taxes withheld by Intrepid Potash and Intrepid Mining for the calendar year in which the Closing Date occurs. Intrepid Potash and Intrepid Mining shall each attach the information required by Revenue Procedure 2004-53 to the Form 941 filed by each for the year in which the Closing Date occurs. Intrepid Potash and Intrepid Mining agree to comply with all requirements of Revenue Procedure 2004-53 and to cooperate with each other in complying with such requirements.

7.7 Consistent Tax Treatment . Intrepid Mining and Intrepid Potash each covenant and agree, for all applicable Tax purposes, to treat the IPO, the Exchange, and the Formation Distribution as one integrated transaction in which the purchasers of the Common Stock in the IPO and Intrepid Mining are transferors to a controlled corporation (Intrepid Potash) in an exchange described by section 351(a) of the Internal Revenue Code of 1986, as amended (the “ Code ”), and in which Intrepid Mining receives “boot” in an amount equal to the sum of the Cash Portion and the cash amount of the Formation Distribution. Intrepid Mining and Intrepid Potash each covenant and agree (i) that it will not take or assert any position that is contrary to the treatment described in the preceding sentence on any Tax Return or in connection with any audit or other examination of any Tax Return (unless required by or pursuant to a closing agreement with the Internal Revenue Service (the “ IRS ”) or applicable state or local governmental authority, an

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agreement contained in IRS Form 870-AD or other similar form, an agreement that constitutes a determination under section 1313(a)(4) of the Code or a comparable provision of applicable state or local law, or a decision of any court of competent jurisdiction that is not subject to appeal or as to which the period for appeal has expired) and (ii) that it will reasonably cooperate with the other party to report the transactions contemplated by this Agreement in a manner that is consistent, as between the parties, for Tax purposes.

8. Indemnification .

8.1 Right to Indemnification. Intrepid Potash shall indemnify, defend and save and hold harmless Intrepid Mining, its members and managers, and their respective officers, directors, members, managers, employees, consultants, representatives, agents and Affiliates (the “ Indemnified Parties ”), for, against, from and in respect of any and all Losses which may be sustained or suffered by any of them arising out of or resulting from or pertaining to:

(a) any failure of Intrepid Potash to perform any covenant or agreement or fulfill any other obligation in respect hereof; or

(b) any of the Assumed Liabilities.

8.2 Procedure for Indemnification.

(a) Promptly after receipt by an Indemnified Party hereunder of written notice of the commencement of any Proceeding with respect to which a claim for indemnification may be made pursuant to this Section 8, such Indemnified Party will, if a claim in respect thereof is to be made against Intrepid Potash, give written notice to Intrepid Potash of the commencement of such Proceeding; provided, however , that the failure of the Indemnified Party to give notice as provided herein shall not relieve Intrepid Potash of its obligations under this Section 8, except to the extent that Intrepid Potash is materially prejudiced by such failure to give notice.

(b) In case any such Proceeding is brought against an Indemnified Party, unless in such Indemnified Party’s reasonable judgment (after consultation with legal counsel) a bona fide conflict of interest between such Indemnified Party and Intrepid Potash may exist in respect of such Proceeding, Intrepid Potash will be entitled to participate in and to assume the defense thereof (at its expense) with counsel reasonably satisfactory to such Indemnified Party, and after notice from Intrepid Potash to such Indemnified Party of its election so to assume the defense thereof, Intrepid Potash will not be liable to such Indemnified Party for any legal or other expenses subsequently incurred by the Indemnified Party in

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connection with the defense thereof other than reasonable costs of investigation; provided, however , in the event Intrepid Potash declines or fails to assume the defense of the Proceeding or to employ counsel reasonably satisfactory to the Indemnified Party, in either case within a 30-day period, or if a court of competent jurisdiction determines that Intrepid Potash is not vigorously defending such Proceeding, or if there is a bona fide conflict of interest between Intrepid Potash and the Indemnified Party, then such Indemnified Party may employ counsel to represent or defend it in any such Proceeding and Intrepid Potash shall pay the reasonable fees and disbursements of such counsel or other representative as incurred; provided, further, however , that Intrepid Potash shall not be required to pay the fees and disbursements of more than one counsel for all Indemnified Parties in any jurisdiction in any single Proceeding.

(c) Intrepid Potash will not settle any such Proceeding or consent to the entry of any judgment without the prior written consent of the Indemnified Party, unless such settlement or judgment (i) includes as an unconditional term thereof the giving by the claimant or plaintiff of a release to such Indemnified Party from all liability in respect of such Proceeding and (ii) does not involve the imposition of equitable remedies or the imposition of any obligations on such Indemnified Party and does not otherwise adversely affect such Indemnified Party, other than as a result of the imposition of financial obligations for which such Indemnified Party will be indemnified hereunder. No Indemnified Party will settle any such Proceeding or consent to the entry of any judgment without the prior written consent of Intrepid Potash (such consent not to be unreasonably withheld).

9. Miscellaneous

9.1 Governing Law. This Agreement shall be governed by and construed in all respects in accordance with the laws of the State of Delaware without giving effect to principles of conflicts of law.

9.2 Notices. All notices, demands or other communications to be given under or by reason of this Agreement shall be in writing and shall be deemed to have been received when delivered personally, or when transmitted by overnight delivery service, addressed as follows:

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Any party to this Agreement may change its address for notices, demands and other communications under this Agreement by giving notice of such change to the other party hereto in accordance with this Section 9.2.

9.3 Survival . The representations, warranties, covenants and agreements made herein shall survive any investigation made by any of the parties hereto and the Closing of the transactions contemplated hereby.

9.4 Benefit of Parties; Assignment . This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, the other Indemnified Parties, and their respective successors, legal representatives and permitted assigns. This Agreement may not be assigned by either Intrepid Potash or Intrepid Mining except with the prior written consent of Intrepid Mining, in the case of an assignment by Intrepid Potash, or Intrepid Potash, in the case of an assignment by Intrepid Mining. Nothing herein contained shall confer or is intended to confer on any third party or entity that is not a party to this Agreement, other than the Indemnified Parties, any rights under this Agreement.

9.5 Amendment . This Agreement may not be amended, modified, altered or supplemented except by means of a written instrument executed on behalf of each of Intrepid Potash and Intrepid Mining.

9.6 Waiver . No failure on the part of either party hereto to exercise any power, right, privilege or remedy under this Agreement, and no delay on the part of either party hereto in exercising any power, right, privilege or remedy under this Agreement, shall operate as a waiver thereof; and no single or partial exercise of any such power, right, privilege or remedy shall preclude any other or further exercise thereof or of any other power, right, privilege or remedy.

9.7 Severability . If any provision of this Agreement is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement will remain in full force and effect. Any provision of this Agreement held invalid or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid or unenforceable.

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9.8 Entire Agreement . This Agreement sets forth the entire understanding of parties hereto and supersedes all other agreements and understandings between the parties hereto relating to the subject matter hereof.

9.9 Counterparts and Facsimiles . This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement, and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other. The parties hereto may execute the signature pages hereof and exchange such signature pages by facsimile transmission.

9.10 Interpretation of Agreement .

(a) As used in this Agreement, the words “include” and “including,” and variations thereof, shall not be deemed to be terms of limitation, and shall be deemed to be followed by the words “without limitation.”

(b) Unless otherwise specified, references in this Agreement to “Sections” are intended to refer to Sections of this Agreement.

(c) The Section headings contained in this Agreement are solely for the purpose of reference, are not part of the agreement of the parties and shall not in any way affect the meaning or interpretation of this Agreement.

(d) Each party hereto and its counsel cooperated in drafting and preparation of this Agreement and the documents referred to in this Agreement. Any rule of law or any legal decision that would require interpretation of any ambiguities in this Agreement against the party that drafted it is of no application and is hereby expressly waived.

[Signature page to follow]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the day and year first above written.

[Signature page of Exchange Agreement]