Document:

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                                                                 EXHIBIT 10.1.13

                       INCENTIVE STOCK OPTION AGREEMENT

                                                   Date of Grant: August 3, 1999
                                                        Number of Shares: ______
                                                Exercise Price Per Share: $_____

Dear:

          We are pleased to inform you that, as a key employee of Terra
Industries Inc. (the "Corporation") or a Subsidiary thereof, you have been
granted, under the Terra Industries Inc. 1997 Stock Incentive Plan, an Incentive
Stock Option (the "Option"), evidenced by this letter, to purchase up to a total
of the number of Common Shares set forth above at the price per share set forth
above and on the terms and conditions set forth below. The Option is intended
(but not warranted) to be an incentive stock option within the meaning of
section 422 of the Internal Revenue Code.

1.   The Option cannot be exercised unless you sign your name in the space
     provided on the copy of this letter enclosed with this letter and deliver
     it to the Corporate Secretary of the Corporation, Terra Centre, 600 Fourth
     Street, Sioux City, Iowa 51101, before 4:30 p.m. central time on September
     15, 1999. If the Corporate Secretary does not have your properly executed
     copy of this letter before such time, then, anything in this letter to the
     contrary notwithstanding, this award shall terminate and be of no effect.
     Your signing and delivering a copy of this letter will not commit you to
     purchase any of the shares that are subject to the Option, but will
     evidence your acceptance of the Option upon the terms and conditions herein
     stated.

2.   Subject to the provisions of this letter, the Option shall be exercisable,
     in whole at any time or in part from time to time, in integral multiples of
     100 shares each (to the maximum extent possible), during the period set
     forth in this Section 2.

     a.   The Option shall be exercisable with respect to _________ Shares
          evidenced by this letter beginning on the first business day following
          the first anniversary of the Date of Grant.

     b.   The Option shall be exercisable with respect to _________ Shares
          evidenced by this letter beginning on the first business day following
          the second anniversary of the Date of Grant.

     c.   The Option shall be exercisable with respect to the final _________
          Shares evidenced by this letter beginning on the first business day
          following the third anniversary of the Date of Grant.

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     d.   The Option shall be exercisable with respect to all of the Number of
          Shares evidenced by this letter beginning on the day any one of the
          following occurs: (i) any person or group of persons acting in concert
          (other than Anglo American plc, a company incorporated under the laws
          of the United Kingdom, and its affiliates or a group consisting solely
          of such persons (the "Anglo American Affiliates")) acquires beneficial
          ownership (within the meaning of Rule 13d-3 of the Securities and
          Exchange Commission promulgated under the Securities Exchange Act of
          1934) of the outstanding securities (the "Voting Shares") of the
          Corporation in an amount having, or convertible into securities
          having, 25% or more of the ordinary voting power for the election of
          directors of the Corporation, provided that this 25% beneficial
          ownership trigger shall apply only when the Anglo American Affiliates
          no longer own 50% or more of the Voting Shares; (ii) during a period
          of not more than 24 months, a majority of the Board of Directors of
          the Corporation ceases to consist of the existing membership or
          successors nominated by the existing membership or their similar
          successors; (iii) all or substantially all of the individuals and
          entities who were the beneficial owners of the Corporation's
          outstanding securities entitled to vote do not own more than 60% of
          such securities in substantially the same proportions following a
          shareholder approved reorganization, merger, or consolidation; or (iv)
          shareholder approval of either (A) a complete liquidation or
          dissolution of the Corporation or (B) a sale or other disposition of
          all or substantially all of the assets of the Corporation, or a
          transaction having a similar effect.

     e.   The Option shall in all events terminate at the close of business on
          the last business day preceding the tenth anniversary of the Date of
          Grant, but shall be subject to earlier termination as provided in
          Section 4 hereof.

3.   The Option shall not be transferable by you otherwise than by will or by
     the laws of descent and distribution. During your lifetime, the Option
     shall be exercisable only by you.

4.   If your employment with the Corporation and all Subsidiaries terminates
     during the term of this agreement, the Option shall automatically terminate
     and cease to be exercisable, except the term for vesting and exercise shall
     be extended (subject to Section 2e) as follows:

     a.   If your employment terminates by reason of your death, the Option
          shall terminate and cease to be exercisable one year from the date of
          death.

     b.   If your employment terminates by reason of Total Disability or
          Retirement, the Option shall terminate and cease to be exercisable
          three years from the date of Total Disability or Retirement.

     c.   If your employment terminates on or within two years subsequent to the
          circumstances contemplated in Section 2d, the Option shall terminate
          and cease to be exercisable three months from the date of such
          termination of employment.

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     d.   Notwithstanding the foregoing, in cases of special circumstances the
          Committee may, in its sole discretion when it finds that a waiver
          would be in the best interests of the Corporation, extend the term of
          this Option with respect to all or a portion of the Number of Shares
          set forth above for such period of time as the Committee deems
          appropriate.

5.   The Corporation shall not be obligated to deliver any shares until they
     have been listed (or authorized for listing upon official notice of
     issuance) upon each stock exchange upon which are listed outstanding shares
     of the same class as that of the shares at the time subject to the Option
     and until there has been compliance with such laws or regulations as the
     Corporation may deem applicable. The Corporation agrees to use its best
     efforts to effect such listing and compliance. No fractional shares will be
     delivered.

6.   For the purposes of this Agreement: (a) a transfer of your employment from
     the Corporation to a Subsidiary or vice versa, or from one Subsidiary to
     another, without an intervening period, shall not be deemed a termination
     of employment, and (b) if you are granted in writing a leave of absence,
     you shall be deemed to have remained in the employment of the Corporation
     or a Subsidiary during such leave of absence.

7.   In the event of any merger, consolidation, stock dividend, split-up,
     combination or exchange of shares or recapitalization or change in
     capitalization, the number or kind of shares that are subject to the Option
     immediately prior to such event shall be proportionately and appropriately
     adjusted without increase or decrease in the aggregate option price to be
     paid therefor upon exercise of the Option. The determination of the
     Committee as to the terms of any such adjustment shall be binding and
     conclusive upon you and any other person or persons who are at any time
     entitled to exercise the Option.

8.   Neither you nor any other person shall have any rights of a stockholder as
     to shares under the Option until, after proper exercise of the Option, such
     shares shall have been recorded on the Corporation's official stockholder
     records as having been issued or transferred.

9.   Subject to the terms and conditions of this Agreement, the Option may be
     exercised in whole at any time or in part from time to time in integral
     multiples of 100 shares each (to the maximum extent possible) by a written
     notice on a form approved by the Committee that (i) is signed by the person
     or persons exercising the Option, (ii) is delivered to the Corporate
     Secretary of the Corporation, Terra Centre, 600 Fourth Street, Sioux City,
     Iowa 51101 (or at such other place that the Corporate Secretary may specify
     by written notice to you), (iii) signifies election to exercise the Option,
     (iv) states the number of shares as to which it is being exercised, and (v)
     is accompanied by payment in full of the option price of such shares. If a
     properly executed notice of exercise of the Option is not delivered to and
     in the hands of the Corporate Secretary of the Corporation by the
     applicable expiration date or dates of this Option, such notice will be
     deemed null and void and of no effect. If notice of exercise of the Option
     is given by a person or persons other than you, the Corporation may require
     as a condition to

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     exercise of the Option the submission to the Corporation of appropriate
     proof of the right of such person or persons to exercise the Option.
     Certificates for shares so purchased will be issued and delivered as soon
     as practicable.

10.  Payment of the exercise price for shares may be made in cash, by the
     delivery of or certification of ownership of Common Shares that have been
     held by you for a period of at least six months with a Fair Market Value
     equal to the exercise price, or by a combination of cash and such shares
     that have been held by you for a period of at least six months.

11.  You agree to notify the Corporate Secretary of the Corporation in the event
     the shares acquired by you on exercise of the Option are sold or otherwise
     disposed of within one year from the date of exercise or two years from the
     date the Option was granted.

          The Option is issued pursuant to the Plan and is subject to its terms.
Capitalized terms used in this letter have the same meanings as defined in the
Plan. A copy of the Plan is being furnished to you with this letter and also is
available on request from the Corporate Secretary of the Corporation.

                              Very truly yours,

                              TERRA INDUSTRIES INC.

                         By:  ______________________________________
                              President and Chief Executive Officer

                         By:  ______________________________________
                              Senior Vice President, General Counsel
                              and Corporate Secretary

I hereby agree to the terms and conditions set forth above and acknowledge
receipt of the 1997 Stock Incentive Plan and the Prospectus covering shares
issued under that plan.

________________________________
Signature of Employee

                                       4<PAGE>

                                                                 EXHIBIT 10.1.14

                      NONQUALIFIED STOCK OPTION AGREEMENT

                                                   Date of Grant: August 3, 1999
                                                         Number of Shares: _____
                                               Exercise Price Per Share:  $_____

Dear

          We are pleased to inform you that, as a key employee of Terra
Industries Inc. (the "Corporation") or a Subsidiary thereof, you have been
granted, under the Terra Industries Inc. 1997 Stock Incentive Plan, a
Nonqualified Stock Option, evidenced by this letter, to purchase up to a total
of the number of Common Shares set forth above at the exercise price per share
set forth above and on the terms and conditions set forth below. The Option is
not intended to be an incentive stock option within the meaning of section 422
of the Internal Revenue Code.

1.   The Option cannot be exercised unless you sign your name in the space
     provided on the copy of this letter enclosed with this letter and deliver
     it to the Corporate Secretary of the Corporation, Terra Centre, 600 Fourth
     Street, Sioux City, Iowa 51101, before 4:30 p.m. central time on September
     15, 1999. If the Corporate Secretary does not have your properly executed
     copy of this letter before such time, then, anything in this letter to the
     contrary notwithstanding, this award shall terminate and be of no effect.
     Your signing and delivering a copy of this letter will not commit you to
     purchase any of the shares that are subject to the Option, but will
     evidence your acceptance of the Option upon the terms and conditions herein
     stated.

2.   Subject to the provisions of this letter, the Option shall be exercisable,
     in whole at any time or in part from time to time, in integral multiples of
     100 shares each (to the maximum extent possible), during the period set
     forth in this Section 2.

     a.   The Option shall be exercisable with respect to _________ Shares
          evidenced by this letter beginning on the first business day following
          the first anniversary of the Date of Grant.

     b.   The Option shall be exercisable with respect to _________ Shares
          evidenced by this letter beginning on the first business day following
          the second anniversary of the Date of Grant.

     c.   The Option shall be exercisable with respect to the final _________
          Shares evidenced by this letter beginning on the first business day
          following the third anniversary of the Date of Grant.

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     d.   The Option shall be exercisable with respect to all of the Number of
          Shares evidenced by this letter beginning on the day any one of the
          following occurs: (i) any person or group of persons acting in concert
          (other than Anglo American plc, a company incorporated under the laws
          of the United Kingdom, and its affiliates or a group consisting solely
          of such persons (the "Anglo American Affiliates")) acquires beneficial
          ownership (within the meaning of Rule 13d-3 of the Securities and
          Exchange Commission promulgated under the Securities Exchange Act of
          1934) of the outstanding securities (the "Voting Shares") of the
          Corporation in an amount having, or convertible into securities
          having, 25% or more of the ordinary voting power for the election of
          directors of the Corporation, provided that this 25% beneficial
          ownership trigger shall apply only when the Anglo American Affiliates
          no longer own 50% or more of the Voting Shares; (ii) during a period
          of not more than 24 months, a majority of the Board of Directors of
          the Corporation ceases to consist of the existing membership or
          successors nominated by the existing membership or their similar
          successors; (iii) all or substantially all of the individuals and
          entities who were the beneficial owners of the Corporation's
          outstanding securities entitled to vote do not own more than 60% of
          such securities in substantially the same proportions following a
          shareholder approved reorganization, merger, or consolidation; or (iv)
          shareholder approval of either (A) a complete liquidation or
          dissolution of the Corporation or (B) a sale or other disposition of
          all or substantially all of the assets of the Corporation, or a
          transaction having a similar effect.

     e.   The Option shall in all events terminate at the close of business on
          the last business day preceding the tenth anniversary of the Date of
          Grant, but shall be subject to earlier termination as provided in
          Section 4 hereof.

3.   The Option shall not be transferable by you otherwise than by will or by
     the laws of descent and distribution. During your lifetime, the Option
     shall be exercisable only by you.

4.   If your employment with the Corporation and all Subsidiaries terminates
     during the term of this agreement, the Option shall automatically terminate
     and cease to be exercisable, except the term for vesting and exercise shall
     be extended (subject to Section 2e) as follows:

     a.   If your employment terminates by reason of death, the Option shall
          terminate and cease to be exercisable one year from the date of death.

     b.   If your employment terminates by reason of Total Disability or
          Retirement, the Option shall terminate and cease to be exercisable
          three years from the date of Total Disability or Retirement.

     c.   If your employment terminates on or within two years subsequent to the
          circumstances contemplated in Section 2d, the Option shall terminate
          and cease to be exercisable three months from the date of such
          termination of employment.

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<PAGE>

     d.   Notwithstanding the foregoing, in cases of special circumstances the
          Committee may, in its sole discretion when it finds that a waiver
          would be in the best interests of the Corporation, extend the term of
          this Option with respect to all or a portion of the Number of Shares
          set forth above for such period of time as the Committee deems
          appropriate.

5.   The Corporation shall not be obligated to deliver any shares until they
     have been listed (or authorized for listing upon official notice of
     issuance) upon each stock exchange upon which are listed outstanding shares
     of the same class as that of the shares at the time subject to the Option
     and until there has been compliance with such laws or regulations as the
     Corporation may deem applicable. The Corporation agrees to use its best
     efforts to effect such listing and compliance. No fractional shares will be
     delivered.

6.   For the purposes of this Agreement: (a) a transfer of your employment from
     the Corporation to a Subsidiary or vice versa, or from one Subsidiary to
     another, without an intervening period, shall not be deemed a termination
     of employment, and (b) if you are granted in writing a leave of absence,
     you shall be deemed to have remained in the employment of the Corporation
     or a Subsidiary during such leave of absence.

7.   In the event of any merger, consolidation, stock dividend, split-up,
     combination or exchange of shares or recapitalization or change in
     capitalization, the number or kind of shares that are subject to the Option
     immediately prior to such event shall be proportionately and appropriately
     adjusted without increase or decrease in the aggregate option price to be
     paid therefor upon exercise of the Option. The determination of the
     Committee as to the terms of any such adjustment shall be binding and
     conclusive upon you and any other person or persons who are at any time
     entitled to exercise the Option.

8.   Neither you nor any other person shall have any rights of a stockholder as
     to shares under the Option until, after proper exercise of the Option, such
     shares shall have been recorded on the Corporation's official stockholder
     records as having been issued or transferred.

9.   Subject to the terms and conditions of this Agreement, the Option may be
     exercised in whole at any time or in part from time to time in intregal
     multiples of 100 shares each (to the maximum extent possible) by a written
     notice on a form approved by the Committee that (i) is signed by the person
     or persons exercising the Option, (ii) is delivered to the Corporate
     Secretary of the Corporation, Terra Centre, 600 Fourth Street, Sioux City,
     Iowa 51101 (or at such other place that the Corporate Secretary may specify
     by written notice to you), (iii) signifies election to exercise the Option,
     (iv) states the number of shares as to which it is being exercised, and (v)
     is accompanied by payment in full of the exercise price of such shares. If
     a properly executed notice of exercise of the Option is not delivered to
     and in the hands of the Corporate Secretary of the Corporation by the
     applicable expiration date or dates of this Option, such notice will be
     deemed null and void and of no effect. If notice of exercise of the Option
     is given by a person or persons other than you, the Corporation may require
     as a condition to exercise of the Option the submission to the Corporation
     of

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     appropriate proof of the right of such person or persons to exercise the
     Option. Certificates for shares so purchased will be issued and delivered
     as soon as practicable.

10.  Payment of the exercise price for shares may be made in cash, by the
     delivery of or certification of ownership of Common Shares that have been
     held by you for a period of at least six months with a Fair Market Value
     equal to the exercise price, or by a combination of cash and such shares
     that have been held by you for a period of at least six months.

11.  You hereby agree to pay to the Corporation, or otherwise make arrangements
     satisfactory to the Corporation regarding payment of, any federal, state or
     local taxes required or authorized by law to be withheld with respect to
     the award of this Option or its exercise (the "Withholding Taxes"). The
     Corporation shall have, to the extent permitted by law, the right to deduct
     from any payment of any kind otherwise due to the Employee, any Withholding
     Taxes and to condition the delivery of the Common Shares after the exercise
     of the Option on the payment to the Corporation of the Withholding Taxes.
     In lieu of the payment of such amounts in cash, you may pay all or a
     portion of the Withholding Taxes by (i) the delivery of Common Shares not
     subject to any Restriction Period or (ii) having the Corporation withhold a
     portion of the Common Shares otherwise to be delivered upon exercise of the
     Option.

     The Option is issued pursuant to the Plan and is subject to its terms.
Capitalized terms used in this letter have the same meanings as defined in the
Plan. A copy of the Plan is being furnished to you with this letter and also is
available on request from the Corporate Secretary of the Corporation.

                              Very truly yours,

                              TERRA INDUSTRIES INC.

                         By:  __________________________________________
                              President and Chief Executive Officer

                         By:  __________________________________________
                              Senior Vice President, General Counsel and
                              Corporate Secretary

I hereby agree to the terms and conditions set forth above and acknowledge
receipt of the 1997 Stock Incentive Plan and the Prospectus covering shares
issued under that Plan.

______________________________
Signature of Employee

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