Agreement of Limited Partnership

Ownership of TNCLP is composed of the general partner interests and the limited partner interests (see Note 1—Background and Basis of Presentation). Holders of common units and Class B common units do not have preemptive rights. Holders of common units are entitled to one vote per common unit with respect to each matter on which holders of common units are entitled to vote. The Class B common units have no voting rights on any matter. Unitholders have only limited voting rights on matters affecting our business and, therefore, limited ability to influence management's decisions regarding our business. Unitholders have no right to elect the General Partner or the TNGP Board of Directors on an annual or other continuing basis. Furthermore, the General Partner may only be removed by a vote of the holders of at least 66 2/3% of our outstanding common units, including any common units held by the General Partner and its affiliates (including CF Industries). Given that the General Partner and its affiliates own approximately 75.1% of our outstanding common units, holders of our publicly-traded common units are not able to remove the General Partner under any circumstances.

We make quarterly distributions to holders of our general partner interest and limited partner interests based on Available Cash for the quarter as defined in our agreement of limited partnership. Available Cash is defined generally as all cash receipts less all cash disbursements, less certain reserves (including reserves for future operating and capital needs) established as the General Partner determines in its reasonable discretion to be necessary or appropriate. Changes in working capital affect Available Cash as changes in the amount of cash invested in working capital items (such as increases in inventory and decreases in accounts payable) reduce Available Cash, while declines in the amount of cash invested in working capital items increase Available Cash. We declared and paid distributions of $257.5 million, $294.8 million and $304.1 million to our unitholders in 2016, 2015 and 2014, respectively.

We receive 99% of the Operating Partnership's Available Cash (as defined in the Operating Partnership's agreement of limited partnership) and 1% of the Operating Partnership's Available Cash is distributed by the Operating Partnership to the General Partner and its affiliates. Pursuant to our agreement of limited partnership, distributions of our Available Cash are made 99.975% to common and Class B common unitholders and 0.025% to the General Partner except that the General Partner is entitled, as an incentive, to a larger percentage of our distribution of Available Cash to the extent that cumulative distributions of Available Cash exceed specified target levels above the Minimum Quarterly Distributions (MQD) of $0.605 per unit. The General Partner has assigned its right to receive such incentive distributions to an affiliate of the General Partner.

On February 6, 2017, we announced a $1.22 cash distribution per common unit, payable on February 28, 2017 to holders of record as of February 17, 2017. In the fourth quarter of 2016, we exceeded the cumulative MQD amounts and will distribute Available Cash as summarized in the following table:



	Income and Distribution Allocation
	Target Limit		Target Increment		Common Units		Class B Common Units		General Partner⁽¹⁾		Total
Minimum Quarterly Distributions	$	0.605	$	0.605	98.990	%	0.985	%	0.025	%	100.00	%
First Target	0.715		0.110		98.990	%	0.985	%	0.025	%	100.00	%
Second Target	0.825		0.110		85.859	%	0.985	%	13.156	%	100.00	%
Third Target	1.045		0.220		75.758	%	0.985	%	23.257	%	100.00	%
Final Target and Beyond	>1.045		—		50.505	%	0.985	%	48.510	%	100.00	%

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⁽¹⁾	Reflects Minimum Quarterly Distributions and incentive distributions to the General Partner. The General Partner has assigned its right to incentive distributions to an affiliate of the General Partner.

The quarterly cash distributions to the unitholders and the General Partner declared in 2016 and 2015 are as follows:



		Common Units				Class B Common Units				General Partner		Total Distributions Declared
		Total		Per unit		Total		Per unit		Total		Total Distributions Declared
		(in millions, except per unit amounts)
2016
	First Quarter	$	53.3	$	2.88	$	0.9	$	4.78	$	36.0	$	90.2
	Second Quarter	28.0		1.51		0.4		2.09		11.1		39.5
	Third Quarter	47.7		2.58		0.7		4.17		30.4		78.8
	Fourth Quarter	32.7		1.77		0.5		2.60		15.8		49.0
2015
	First Quarter	$	46.3	$	2.50	$	0.7	$	4.03	$	29.1	$	76.1
	Second Quarter	38.5		2.08		0.6		3.20		21.3		60.4
	Third Quarter	43.6		2.36		0.7		3.74		26.5		70.8
	Fourth Quarter	52.0		2.81		0.9		4.64		34.6		87.5

As of December 31, 2016, the General Partner and its affiliates owned approximately 75.1% of our outstanding common units. When not more than 25% of our issued and outstanding common units are held by persons other than the General Partner and its affiliates (collectively, non-affiliated persons), as was the case at December 31, 2016, we, at the General Partner's sole discretion, may call, or assign to the General Partner or its affiliates, our right to acquire all, but not less than all, such outstanding common units held by non-affiliated persons. If the General Partner elects to acquire all outstanding common units, we are required to give at least 30 but not more than 60 days' notice of our decision to purchase the outstanding common units. The purchase price per unit will be the greater of (1) the average of the previous 20 trading days' closing prices as of the date five days before the purchase is announced or (2) the highest price paid by the General Partner or any of its affiliates for any unit within the 90 days preceding the date the purchase is announced.