<PAGE>
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 7, 2000
TERRA INDUSTRIES INC.
(Exact name of registrant as specified in its charter)
Maryland 1-8520 52-1145429
(State or other jurisdiction of (Commission File (I.R.S. Employer
incorporation or organization) Number) Identification No.)
Terra Centre
600 Fourth Street
P.O. Box 6000
Sioux City, Iowa 51102-6000
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (712) 277-1340
================================================================================
<PAGE>
Item 5. Other Events
Terra Industries Inc. announced today, April 7, 2000, that it completed a $225
million asset-based financing with Citibank, N.A., as Administrative Agent, and
Salomon Smith Barney Inc., as Arranger, that replaces Terra's existing $63
million revolving credit line and amends and restates its $109 million long-term
bank notes. The credit arrangements, which expire in January 2003, contain three
components: a $116 million revolving credit facility, a $59 million amended
Canadian term loan and a $50 million consolidated term loan. The revolving
credit facility and amended Canadian term loan are secured primarily by Terra's
accounts receivable and inventories; the consolidated term loan is secured
primarily by Terra's fixed assets. Anglo American plc, which owns 49.5% of
Terra's outstanding common shares, is providing limited credit support for the
consolidated term loan.
Available borrowings under the revolving credit facility and amended Canadian
term loan will depend upon Terra's accounts receivable and inventory levels.
Interest rates for borrowings under the agreement will not exceed spreads over
LIBOR of 4% for the consolidated term loan, 3.25% for the amended Canadian term
loan and 2.75% for the revolving credit facility. Mandatory principal repayments
are $1.25 million quarterly on the consolidated term loan. The agreement
requires Terra to attain minimum quarterly earnings before interest, income
taxes, depreciation and amortization (EBITDA) as more particularly defined in
the agreement. The minimum annual EBITDA requirements for calendar 2000 and 2001
are $45 million and $90 million, respectively.
2
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TERRA INDUSTRIES INC.
By: /s/ George H. Valentine
---------------------------------------------
George H. Valentine
Senior Vice President, General Counsel
and Corporate Secretary
Date: April 7, 2000
3
