Terra Capital, Inc. (“Terra Capital”), a wholly-owned subsidiary of Terra Industries Inc. (NYSE:TRA), announced today that it has commenced a cash tender offer for any and all of its 127/8% Senior Secured Notes due 2008 and 111/2% Second Priority Senior Secured Notes due 2010. The two series of debt securities have combined principal amounts outstanding of $331,300,000.
As part of this offer, Terra Capital is soliciting noteholders’ consents to amend certain provisions of these notes and the related indentures. The tender offer and consent solicitation are being made pursuant to an Offer to Purchase and Consent Solicitation Statement dated January 10, 2007, and a related Letter of Transmittal and Consent, which more fully set forth the terms and conditions of the tender offer and consent solicitation.
For both offers, the deadline to receive the consent payment for the consent solicitation is 5:00 p.m. Eastern Standard Time (EST) on January 24, 2007 and the expiration date is midnight EST, on February 7, 2007. Holders may withdraw their tendered notes and related consents prior to 5:00 p.m. EST on January 24, 2007. The tender offer and these dates may be extended by Terra Capital.
The purchase prices for notes of each series will be determined at 2:00 p.m. EST on January 25, 2007 (subject to extension) in the manner described in the Offer to Purchase and Consent Solicitation Statement. The purchase price for the 127/8% Senior Secured Notes and 111/2% Second Priority Senior Secured Notes will be a “fixed spread” price. The fixed spread prices for each of the two series of notes will be calculated using a yield equal to a fixed spread of 50 basis points plus the yield to maturity of, in the case of the 127/8% Senior Secured Notes, the 3.125% U.S. Treasury Note due October 15, 2008 and, in the case of the 111/2% Second Priority Senior Secured Notes, the 3.50% U.S. Treasury Note due May 31, 2007.
