Form of PHANTOM UNIT AWARD

Exhibit 10.41

Form of

PHANTOM UNIT AWARD

Date of Award:                     

Number of Shares Awarded:                     

Name

Address

City ST Zip

Dear                         :

By action of the board of directors of Terra Nitrogen Corporation (“TNC”), TNC has granted you a Phantom Unit Award of Terra Nitrogen Company, L.P. (“TNCLP”) in partial payment for your valued service as a non-management director of TNC and as an inducement for your continued contribution to the success of TNCLP.

The Phantom Unit Award will entitle you to a cash payment, less applicable taxes, equal to the value of 1,250 of TNCLP’s common units after your departure from the TNC board. In addition to this annual award, non-management directors shall receive a quarterly distribution of phantom common units based upon the quarterly cash distribution made to TNCLP’s unitholders and the TNCLP common unit market value.

In the event of a sale of TNCLP (including by merger or other corporate transaction) or a sale of substantially all of TNCLP’s assets, the value of the phantom common units shall be determined on the date of sale by reference to the consideration received for shares of common units or assets of TNCLP in the sale transaction and the value shall be paid to you in a lump sum upon consummation of the transaction. Any noncash, deferred or contingent consideration provided for in the sale agreement shall be valued at its fair market value on a present value basis. The determination of value for these purposes shall be conclusively made by TNC with the assistance of TNCLP’s independent accountants.