-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, J2hW3ogKBh+M4W5Fs6+jlWYKk32G17usFwDm0CKFBnr/VErpgXkNBMH/ymAG/p0f UM0aXZfH0wN7XiwwT5CTKQ== 0000950131-96-003085.txt : 19960701 0000950131-96-003085.hdr.sgml : 19960701 ACCESSION NUMBER: 0000950131-96-003085 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19951231 FILED AS OF DATE: 19960628 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: TERRA INDUSTRIES INC CENTRAL INDEX KEY: 0000722079 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-MISCELLANEOUS NONDURABLE GOODS [5190] IRS NUMBER: 521145429 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08520 FILM NUMBER: 96587823 BUSINESS ADDRESS: STREET 1: TERRA CENTRE 600 4TH ST STREET 2: P.O. BOX 6000 CITY: SIOUX CITY STATE: IA ZIP: 51102-6000 BUSINESS PHONE: 7122771340 MAIL ADDRESS: STREET 1: TERRA CENTER STREET 2: 600 4TH ST P O BOX 6000 CITY: SIOUX CITY STATE: IA ZIP: 51102-6000 FORMER COMPANY: FORMER CONFORMED NAME: INSPIRATION RESOURCES CORP DATE OF NAME CHANGE: 19920517 11-K 1 FORM 11-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED) For the Year Ended December 31, 1995 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED) For the Transition Period From to Commission File Number 1-8520 A. Full title of the Plan and the address of the Plan, if different from that of the issuer named below: TERRA INDUSTRIES INC. EMPLOYEES' SAVINGS AND INVESTMENT PLAN B. Name of issuer of the securities held pursuant to the Plan and the address of its principal executive office: TERRA INDUSTRIES INC. TERRA CENTRE 600 FOURTH STREET P.O. BOX 6000 SIOUX CITY, IOWA 51102-6000 REQUIRED INFORMATION Plan financial statements and schedules are prepared in accordance with the financial reporting requirements of ERISA and are included therein as listed in the table of contents below.
Table of Contents - ----------------- (a) Financial Statements Pages ------------------------ ----- Independent Auditors' Report 3 Statements of Net Assets Available for Benefits at December 31, 1995 and 1994 4-5 Statements of Changes in Net Assets Available for Benefits for the Years Ended December 31, 1995 and 1994 6-7 Notes to Financial Statements 8-11 (b) Supplemental Schedules -------------------------- Schedule of Assets Held for Investment Purposes 12-13 Schedule of Reportable Transactions 14 (c) Exhibits ------------ Exhibit E - Independent Auditors' Consent 15
INDEPENDENT AUDITORS' REPORT To the Participants and Administrator of the Terra Industries Inc. Employees' Savings and Investment Plan We have audited the accompanying statements of net assets available for benefits of the Terra Industries Inc. Employees' Savings and Investment Plan as of December 31, 1995 and 1994, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such financial statements present fairly, in all material respects, the net assets available for benefits of the Terra Industries Inc. Employees' Savings and Investment Plan as of December 31, 1995 and 1994, and the changes in net assets available for benefits for the years then ended in conformity with generally accepted accounting principles. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of (1) assets held for investment purposes as of December 31, 1995, and (2) reportable transactions for the year ended December 31, 1995, are presented for purposes of additional analysis and are not a required part of the basic financial statements, but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental information by fund in the statements of net assets available for benefits and the statements of changes in net assets available for benefits is presented for the purpose of additional analysis rather than to present the net assets available for benefits and changes in net assets available for benefits of the individual funds. The supplemental schedules and supplemental information by fund is the responsibility of the Plan's management. Such supplemental schedules and supplemental information by fund have been subjected to the auditing procedures applied in our audits of the basic financial statements and, in our opinion, are fairly stated in all material respects when considered in relation to the basic financial statements taken as a whole. DELOITTE & TOUCHE LLP Omaha, Nebraska April 26, 1996 TERRA INDUSTRIES INC. EMPLOYEES' SAVINGS AND INVESTMENT PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------ Supplemental Information by Fund -------------------------------------------------------------------- Employer Directed Participant Directed ------------ ----------------------------------------------------- Terra Terra Industries Industries Inc. Inc. Voluntary Equity Common Stock Common Stock Income Intermediate Stock ASSETS: Fund Fund Fund Fund Fund Investments, at fair value: Terra Industries Inc. Common Stock $22,849,038 $6,166,806 $ -- $ -- $ -- Fidelity Magellan Fund -- -- -- -- 16,680,769 Vista Growth and Income Fund -- -- 8,963,731 -- -- Vanguard Windsor Fund -- -- -- -- -- Vista U.S. Government Income Fund -- -- -- 4,415,907 -- Vista U.S. Government Money Market Fund -- -- -- -- -- American Performance Cash Management Fund -- -- -- -- -- BancOklahoma GIC Fund -- -- -- -- -- Chase Bank Domestic Liquidity Fund 184,067 3,321 46 24 -- ----------- ---------- ---------- ---------- ----------- Total investments at fair value 23,033,105 6,170,127 8,963,777 4,415,931 16,680,769 Loans to participants -- -- -- -- -- ----------- ---------- ---------- ---------- ----------- Total investments 23,033,105 6,170,127 8,963,777 4,415,931 16,680,769 Accrued investment income -- -- -- 21,281 -- Employer contributions receivable 192,627 -- -- -- -- Participant contributions receivable -- 30,521 43,237 22,890 76,301 Receivable - securities sold -- 79,793 -- -- -- Cash 82 1 -- -- 203 ----------- ---------- ---------- ---------- ----------- Total assets 23,225,814 6,280,442 9,007,014 4,460,102 16,757,273 LIABILITIES: Accrued administrative expenses -- 2,988 4,593 2,424 8,485 Payable - securities purchased 133,053 -- -- -- -- ----------- ---------- ---------- ---------- ----------- Total liabilities 133,053 2,988 4,593 2,424 8,485 ----------- ---------- ---------- ---------- ----------- Net assets available for benefits $23,092,761 $6,277,454 $9,002,421 $4,457,678 $16,748,788 =========== ========== ========== ========== =========== Participant Directed ------------------------------------------------------ Money Market GIC Windsor Participant ASSETS: Fund Fund Fund Loans Total Investments, at fair value: Terra Industries Inc. Common Stock $ -- $ -- $ -- $ -- $29,015,844 Fidelity Magellan Fund -- -- -- -- 16,680,769 Vista Growth and Income Fund -- -- -- -- 8,963,731 Vanguard Windsor Fund -- -- 8,882,165 -- 8,882,165 Vista U.S. Government Income Fund -- -- -- -- 4,415,907 Vista U.S. Government Money Market Fund 3,621,921 -- -- -- 3,621,921 American Performance Cash Management Fund -- 159,390 -- -- 159,390 BancOklahoma GIC Fund -- 3,055,795 -- -- 3,055,795 Chase Bank Domestic Liquidity Fund -- 63,503 -- -- 250,961 ---------- ---------- ---------- ---------- ----------- Total investments at fair value 3,621,921 3,278,688 8,882,165 -- 75,046,483 Loans to participants -- -- -- 3,136,466 3,136,466 ---------- ---------- ---------- ---------- ----------- Total investments 3,621,921 3,278,688 8,882,165 3,136,466 78,182,949 Accrued investment income -- 584 -- -- 21,865 Employer contributions receivable -- -- -- -- 192,627 Participant contributions receivable 20,347 17,804 43,238 -- 254,338 Receivable - securities sold -- -- -- -- 79,793 Cash 77 1 -- -- 364 ---------- ---------- ---------- ---------- ----------- Total assets 3,642,345 3,297,077 8,925,403 3,136,466 78,731,936 LIABILITIES: Accrued administrative expenses 2,042 21,000 4,288 -- 45,820 Payable - securities purchased -- -- -- -- 133,053 ---------- ---------- ---------- ---------- ----------- Total liabilities 2,042 21,000 4,288 -- 178,873 ---------- ---------- ---------- ---------- ----------- Net assets available for benefits $3,640,303 $3,276,077 $8,921,115 $3,136,466 $78,553,063 ========== ========== ========== ========== ===========
See notes to financial statements. -4- TERRA INDUSTRIES INC. EMPLOYEES' SAVINGS AND INVESTMENT PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS DECEMBER 31, 1994
- ------------------------------------------------------------------------------------------------------------------------------------ Supplemental Information by Fund ------------------------------------------------------------ Employer Directed Participant Directed -------------- ------------------------------------------- Terra Terra Industries Industries Inc. Inc. Voluntary Equity Common Stock Common Stock Income Intermediate Fund Fund Fund Fund ASSETS: Investments, at fair value: Terra Industries Inc. Common Stock $14,260,220 $3,332,045 $ -- $ -- Fidelity Magellan Fund -- -- -- -- Vista Growth and Income Fund -- -- 6,716,116 -- Vanguard Windsor Fund -- -- -- -- Vista U.S. Government Income Fund -- -- -- 4,164,658 Vista U.S. Government Money Market Fund -- -- -- -- American Performance Cash Management Fund -- -- -- -- BancOklahoma GIC Fund -- -- -- -- Chase Bank Domestic Liquidity Fund 6,012 484 45 28 American Performance Equity Fund -- -- -- -- BancOklahoma Balanced Investment Fund -- -- -- -- American Performance Aggressive Growth Fund -- -- -- -- American Performance Bond Fund -- -- -- -- ----------- ---------- ---------- ---------- Total investments at fair value 14,266,232 3,332,529 6,716,161 4,164,686 Loans to participants -- -- -- -- ----------- ---------- ---------- ---------- Total investments 14,266,232 3,332,529 6,716,161 4,164,686 Accrued investment income -- -- 38,325 25,360 Employer contributions receivable 183,171 -- -- -- Participant contributions receivable -- 11,820 48,969 32,083 Cash -- -- -- -- ----------- ---------- ---------- ---------- Total assets 14,449,403 3,344,349 6,803,455 4,222,129 LIABILITIES: Accrued administrative expenses -- -- 4,031 2,452 Other payables -- -- -- -- ----------- ---------- ---------- ---------- Total liabilities -- -- 4,031 2,452 ----------- ---------- ---------- ---------- Net assets available for benefits $14,449,403 $3,344,349 $6,799,424 $4,219,677 =========== ========== ========== ========== Money Merged Stock Market Participant Plan Fund Fund Loans (Note F) Total ASSETS: Investments, at fair value: Terra Industries Inc. Common Stock $ -- $ -- $ -- $ -- $17,592,265 Fidelity Magellan Fund 9,520,440 -- -- -- 9,520,440 Vista Growth and Income Fund -- -- -- -- 6,716,116 Vanguard Windsor Fund -- -- -- 4,861,016 4,861,016 Vista U.S. Government Income Fund -- -- -- -- 4,164,658 Vista U.S. Government Money Market Fund -- 3,528,158 -- -- 3,528,158 American Performance Cash Management Fund -- -- -- 544,395 544,395 BancOklahoma GIC Fund -- -- -- 2,279,472 2,279,472 Chase Bank Domestic Liquidity Fund 1,412 -- -- -- 7,981 American Performance Equity Fund -- -- -- 1,223,346 1,223,346 BancOklahoma Balanced Investment Fund -- -- -- 951,498 951,498 American Performance Aggressive Growth Fund -- -- -- 476,869 476,869 American Performance Bond Fund -- -- -- 425,324 425,324 ---------- ---------- ---------- ----------- ----------- Total investments at fair value 9,521,852 3,528,158 -- 10,761,920 52,291,538 Loans to participants -- -- 1,501,570 1,027,871 2,529,441 ---------- ---------- ---------- ----------- ----------- Total investments 9,521,852 3,528,158 1,501,570 11,789,791 54,820,979 Accrued investment income -- -- -- 8,212 71,897 Employer contributions receivable -- -- -- 85,808 268,979 Participant contributions receivable 52,346 23,640 -- 159,514 328,372 Cash -- 16 -- -- 16 ---------- ---------- ---------- ----------- ----------- Total assets 9,574,198 3,551,814 1,501,570 12,043,325 55,490,243 LIABILITIES: Accrued administrative expenses 5,495 2,063 -- 48,016 62,057 Other payables -- -- -- 22,482 22,482 ---------- ---------- ---------- ----------- ----------- Total liabilities 5,495 2,063 -- 70,498 84,539 ---------- ---------- ---------- ----------- ----------- Net assets available for benefits $9,568,703 $3,549,751 $1,501,570 $11,972,827 $55,405,704 ========== ========== ========== =========== =========== See notes to financial statements.
TERRA INDUSTRIES INC. EMPLOYEES' SAVINGS AND INVESTMENT PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS FOR THE YEAR ENDED DECEMBER 31, 1995
- -------------------------------------------------------------------------------------------------------------------------------- Supplemental Information by Fund ------------------------------------------------------------------------ Employer Directed Participant Directed ------------ -------------------------------------------------------- Terra Terra Industries Industries Inc. Inc. Voluntary Equity Common Stock Common Stock Income Intermediate Stock Fund Fund Fund Fund Fund Investment income: Dividend, interest, and other income $ 155,555 $ 44,373 $ 172,768 $ 270,215 $ 568,706 Net appreciation in fair value of investments 5,504,919 1,604,341 1,743,823 444,492 3,439,276 ----------- ---------- ---------- ---------- ----------- Total investment income 5,660,474 1,648,714 1,916,591 714,707 4,007,982 Employer contributions 3,887,731 -- -- -- -- Participant contributions -- 879,661 1,269,662 641,543 1,868,448 ----------- ---------- ---------- ---------- ----------- Total additions 9,548,205 2,528,375 3,186,253 1,356,250 5,876,430 Deductions: Benefit payments 957,499 202,646 493,375 231,945 755,384 Administrative expenses -- 13,694 22,158 12,378 37,586 Interfund transfers/net loans (52,652) (621,070) 467,723 873,926 (2,096,625) ----------- ---------- ---------- ---------- ----------- Total deductions 904,847 (404,730) 983,256 1,118,249 (1,303,655) ----------- ---------- ---------- ---------- ----------- Net increase (decrease) 8,643,358 2,933,105 2,202,997 238,001 7,180,085 Assets available for benefits: Beginning of year 14,449,403 3,344,349 6,799,424 4,219,677 9,568,703 ----------- ---------- ---------- ---------- ----------- End of year $23,092,761 $6,277,454 $9,002,421 $4,457,678 $16,748,788 =========== ========== ========== ========== =========== Supplemental Information by Fund -------------------------------------------------------------------------------------- Participant Directed ----------------------------------------------------------------------- Money Merged Market GIC Windsor Participant Plan Fund Fund Fund Loans (Note F) Total Investment income: Dividend, interest, and other income $ 214,533 $ 16,082 $ 324,710 $ 215,874 $ -- $ 1,982,816 Net appreciation in fair value of investments -- 196,221 1,332,075 -- -- 14,265,147 ---------- ----------- ----------- ----------- ------------ ----------- Total investment income 214,533 212,303 1,656,785 215,874 -- 16,247,963 Employer contributions -- -- -- -- -- 3,887,731 Participant contributions 623,095 469,400 997,438 -- -- 6,749,247 ---------- ----------- ----------- ----------- ------------ ----------- Total additions 837,628 681,703 2,654,223 215,874 -- 26,884,941 Deductions: Benefit payments 488,454 154,499 217,460 83,859 -- 3,585,121 Administrative expenses 11,195 37,045 18,405 -- -- 152,461 Interfund transfers/net loans 247,427 (2,785,918) (6,502,757) (1,502,881) 11,972,827 -- ---------- ----------- ----------- ----------- ------------ ----------- Total deductions 747,076 (2,594,374) (6,266,892) (1,419,022) 11,972,827 3,737,582 ---------- ----------- ----------- ----------- ------------ ----------- Net increase (decrease) 90,552 3,276,077 8,921,115 1,634,896 (11,972,827) 23,147,359 Assets available for benefits: Beginning of year 3,549,751 -- -- 1,501,570 11,972,827 55,405,704 ---------- ----------- ----------- ----------- ------------ ----------- End of year $3,640,303 $ 3,276,077 $ 8,921,115 $ 3,136,466 $ -- $78,553,063 ========== =========== =========== =========== ============ ===========
See notes to financial statements. -6- TERRA INDUSTRIES INC. EMPLOYEES' SAVINGS AND INVESTMENT PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS FOR THE YEAR ENDED DECEMBER 31, 1994
Supplemental Information by Fund --------------------------------------------------------- Employer Directed Participant Directed ---------- -------------------------------------------- Terra Terra Industries Industries Inc. Inc. Voluntary Equity Common Stock Common Stock Income Intermediate Fund Fund Fund Fund Investment income: Dividend, interest, and other income $ 110,058 $ 21,981 $ 217,460 $ 381,069 Net appreciation (depreciation) in fair value of investments 3,682,515 725,856 (373,042) (496,865) ----------- ---------- --------- --------- Total investment income 3,792,573 747,837 (155,582) (115,796) Employer contributions 1,339,290 - - - Participant contributions - 351,851 1,464,477 918,700 Transfer of assets from merged plan - - - - ----------- ---------- --------- --------- Total additions 5,131,863 1,099,688 1,308,895 802,904 Deductions: Benefit payments 949,775 49,202 873,203 815,500 Administrative expenses - 74 28,375 17,915 Interfund transfers/net loans 2,992 (616,062) 546,293 615,607 ----------- ---------- ---------- ---------- Total deductions 952,767 (566,786) 1,447,871 1,449,022 ----------- ---------- ---------- ---------- Net increase (decrease) 4,179,096 1,666,474 (138,976) (646,118) Assets available for benefits: Beginning of year 10,270,307 1,677,875 6,938,400 4,865,795 ----------- ---------- ---------- ---------- End of year $14,449,403 $3,344,349 $6,799,424 $4,219,677 =========== ========== ========== ==========
Supplemental Information by Fund --------------------------------------------------------- Participant Directed --------------------------------------------------------- Money Merged Stock Market Participant Plan Fund Fund Loans (Note F) Total Investment income: Dividend, interest, and other income $ 376,829 $ 118,733 $ 183,523 $ - $1,409,653 Net appreciation (depreciation) in fair value of investments (548,140) - - - 2,990,324 ---------- ---------- --------- ----------- ----------- Total investment income (171,311) 118,733 183,523 - 4,399,977 Employer contributions - - - - 1,339,290 Participant contributions 1,564,946 676,944 - - 4,976,918 Transfer of assets from merged plan - - - 11,972,827 11,972,827 ---------- ---------- --------- ----------- ----------- Total additions 1,393,635 795,677 183,523 11,972,827 22,689,012 Deductions: Benefit payments 1,057,277 299,018 67,417 - 4,111,392 Administrative expenses 37,877 12,208 - - 96,449 Interfund transfers/net loans (22,977) (256,587) (269,266) - - ---------- ---------- ---------- ----------- ----------- Total deductions 1,072,177 54,639 (201,849) - 4,207,841 ---------- ---------- ---------- ----------- ----------- Net increase (decrease) 321,458 741,038 385,372 11,972,827 18,481,171 Assets available for benefits: Beginning of year 9,247,245 2,808,713 1,116,198 - 36,924,533 ---------- ---------- ---------- ----------- ----------- End of year $9,568,703 $3,549,751 $1,501,570 $11,972,827 $55,405,704 ========== ========== ========== =========== ===========
See notes to financial statements. TERRA INDUSTRIES INC. EMPLOYEES' SAVINGS AND INVESTMENT PLAN NOTES TO FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 1995 AND 1994 - -------------------------------------------------------------------------------- A. DESCRIPTION OF PLAN The following brief description of the Terra Industries Inc. Employees' Savings and Investment Plan (the Plan) is provided for general information only. Participants should refer to the Plan Document for more complete information. GENERAL - The Plan, established as of January 1, 1984, is a defined contribution plan covering eligible employees of Terra Industries Inc. and eligible subsidiaries and affiliates (collectively, the Company). The Plan is subject to the Employee Retirement Income Security Act of 1974 (ERISA) and is administered by the Employee Benefit Committee (the Committee) of the Company. The assets of the Plan are held by Chase Manhattan Bank, N.A., the trustee of the Plan. Certain Plan investments are funds managed by the trustee of the Plan and, therefore, qualify as party-in-interest. PARTICIPATION - All full-time active employees of the Company are eligible for Plan participation on the first day of the month following the date their employment commenced. In addition, part time or temporary employees with at least one year of service and 1,000 hours are eligible for participation. Participation in the Plan is voluntary. PARTICIPANTS' ACCOUNTS - Each participant's account is credited with the participant's contributions, the employer's matching contributions and an allocation of fund earnings. A participant's benefit is limited to the amount that can be provided from the participant's account, subject to the applicable vesting requirements. CONTRIBUTIONS - Participants earning $66,000 or less annually in 1995 and 1994, could elect to contribute up to 10% of their annual compensation on a pretax basis and 10% on an after-tax basis. Participants earning more than $66,000 in 1995 and 1994, respectively, could contribute up to 6% of their annual compensation on a combined pretax and after-tax basis. The maximum participant pretax contribution was $9,240 in 1995 and 1994. Participants may elect to invest their contributions in one or more of the seven available participant directed investment options. EMPLOYER - The Company contributes an amount determined by its Board of Directors, equal to 100% of the participants' contributions up to 3% of their annual compensation, and 50% for up to an additional 3% of annual compensation in 1995, and equal to one half of the participants' contributions up to 6% of their annual compensation for 1994. The contributions made by the Company must be invested in the Terra Industries Inc. Common Stock Fund. The Company may elect to make an additional contribution, subject to certain limitations as defined in the Plan, in such amount as its Board of Directors shall determine. No such additional contributions were made in 1995 or 1994. Employer contributions are reduced by the amount of any participant forfeitures during the period. Participant forfeitures totaled to $82,977 and $196,592 in 1995 and 1994, respectively. -8- MAXIMUM CONTRIBUTIONS PER PARTICIPANT - The sum of a participant's contribution and employer matching contribution cannot exceed the lesser of $30,000 or 25% of net compensation of the participant. Net compensation is defined as total participant compensation less any pretax contributions made by the participant. Eligible compensation was limited to $150,000 in 1995 and 1994. VESTING - Participants are immediately fully vested in their contributions and earnings on their voluntary contributions. Employer contributions vest at a rate of 20% per year, until fully vested after five years of service. PARTICIPANT LOANS - Participants may borrow from their individual contribution accounts subject to maximum limitations as defined in the Plan. Loan repayments are reinvested in the funds in accordance with the participant's investment election at the time of repayment. BENEFITS - Participants or their beneficiaries are eligible to receive the value of their vested account balance upon the occurrence of one of the following: early or normal retirement; termination of employment; death or total disability. B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES VALUATION OF INVESTMENTS - Investments, except for loans to participants, are reported at fair value, which is determined, in the case of Terra Industries Inc.'s Common Stock, from the latest available market quotations and, in the case of investments in mutual funds, at quoted net asset value. Money market funds are reported at fair value as determined by the issuer and common funds are valued at the unit value as reported by the fund. In accordance with the policy of stating investments at fair value, the net change in realized and unrealized appreciation or depreciation in fair value is included in income from investments, which is reflected in the statement of changes in net assets available for benefits. Dividend income is recorded on the ex-dividend date. Investment transactions are recognized on a trade date basis. Participant loans are reported at the outstanding balance. The outstanding balance of participant loans approximates fair value. The Plan has investments in eight funds. The net assets and net investment income of the funds are allocated to the participants in the Plan based upon each participant's participation relative to the total participation in each of the eight investment funds. A summary description of each investment fund follows: TERRA INDUSTRIES INC. COMMON STOCK FUND (EMPLOYER DIRECTED) - A fund invested primarily in Terra Industries Inc. Common Stock which is limited to employer contributions only. TERRA INDUSTRIES INC. VOLUNTARY COMMON STOCK FUND (PARTICIPANT DIRECTED) - A fund invested primarily in Terra Industries Inc. Common Stock. EQUITY INCOME FUND (PARTICIPANT DIRECTED) - A fund invested primarily in shares of Vista Growth and Income Fund, which is comprised primarily of income producing equity securities and securities convertible into such equity securities. INTERMEDIATE FUND (PARTICIPANT DIRECTED) - A fund invested primarily in shares of Vista U.S. Government Income Fund, which is comprised primarily of debt obligations backed by the full faith and credit of the U.S. Government. STOCK FUND (PARTICIPANT DIRECTED)- A fund invested primarily in shares of Fidelity Magellan Fund, which is comprised primarily of common stocks and which seeks long-term capital appreciation. -9- MONEY MARKET FUND (PARTICIPANT DIRECTED) - A fund invested primarily in shares of Vista U.S. Government Money Market Fund so as to preserve capital and maintain a high degree of liquidity. GIC FUND (PARTICIPANT DIRECTED) - A fund invested primarily in shares of BancOklahoma Guaranteed Investment Contract Fund so as to provide current income while maintaining a stable market valuation. WINDSOR FUND (PARTICIPANT DIRECTED) - A fund invested primarily in shares of Vanguard Windsor Fund, a fund invested principally in income producing equity securities. BENEFITS PAYABLE - The Plan's policy is to record benefit payments upon distribution of balances to participants. Benefits due and unpaid to retired and terminated participants were $269,751 and $96,718 at December 31, 1995 and 1994, respectively. ADMINISTRATIVE EXPENSES - Administrative expenses are comprised of charges relating to routine services provided by the Plan's trustee and recordkeeping agent and fees associated with the annual audit of the Plan's financial statements. Administrative expenses are allocated to the investment funds, other than the Terra Industries Inc. Common Stock Fund, based upon the fair value of each fund's investment relative to the total fair value of all investment funds to which expenses are allocated. C. INVESTMENTS The fair value of the Plan's investments, other than loans to participants, by basis of valuation, are presented in the following tables. Investments that represent 5% or more of the Plan's investments are separately identified.
December 31, 1995 Number of Shares or Principal Amount Fair Value Investments, at Fair Value: Terra Industries Inc. Common Stock 2,054,219 $29,015,844 Fidelity Magellan Fund 194,008 16,680,769 Vista Growth and Income Fund 258,470 8,963,731 Vanguard Windsor Fund 611,298 8,882,165 Vista U.S. Government Income Fund 380,026 4,415,907 Vista U.S. Government Money Market Fund 3,621,921 3,621,921 American Performance Cash Management Fund 159,390 159,390 BancOklahoma Guaranteed Investment Contract Fund 177,240 3,055,795 Chase Bank Domestic Liquidity Fund 250,961 250,961 ----------- $75,046,483 ===========
-10-
December 31, 1994 Number of Shares or Principal Amount Fair Value Investments, at Fair Value: Terra Industries Inc. Common Stock 1,695,640 $17,592,265 Fidelity Magellan Fund 142,522 9,520,440 Vista Growth and Income Fund 230,874 6,716,116 Vanguard Windsor Fund 386,101 4,861,016 Vista U.S. Government Income Fund 396,257 4,164,658 Vista U.S. Government Money Market Fund 3,528,158 3,528,158 American Performance Cash Management Fund 544,395 544,395 BancOklahoma Guaranteed Investment Contract Fund 140,089 2,279,472 Chase Bank Domestic Liquidity Fund 7,981 7,981 American Performance Equity Fund 121,364 1,223,346 BankOklahoma Balanced Investment Fund 57,371 951,498 American Performance Aggressive Growth Fund 38,395 476,869 American Performance Bond Fund 48,332 425,324 ----------- $52,291,538 ===========
D. PLAN TERMINATION Although it has expressed no intent to do so, the Company specifically reserves the right to amend or terminate the Plan or to discontinue contributions at any time. Upon termination, a participant's entire account will become fully vested and the assets shall be administered in the manner provided for in the Plan. E. FEDERAL INCOME TAX STATUS The Plan obtained its latest determination letter dated November 21, 1995, in which the Internal Revenue Service stated that the Plan, as amended March 9, 1995, was in compliance with the applicable requirements of the Internal Revenue Code. The Plan administrator believes that the Plan is currently designed and is being operated in compliance with the applicable requirements of the Internal Revenue Code. Therefore, they believe that the Plan was qualified and the related trust was tax exempt as of the financial statement date. Therefore, no provision for income taxes has been included in the Plan's financial statements. Plan income, participant pretax contributions and employer contributions represent taxable income to the participating employees at the time of distribution in accordance with IRS regulations currently in effect. F. PLAN MERGER Effective December 31, 1994, the AMCI Employees' Savings Plan was merged into the Terra Industries Inc. Employees' Savings and Investment Plan as a result of the Company's acquisition of Agricultural Minerals and Chemicals, Inc. (AMCI). As a result of the merger of these plans, $11,972,827 was transferred into the Terra Industries Inc. Employees' Savings and Investment Plan. Subsequent to December 31, 1994, the assets of the merged plan, except for the GIC Fund, Vanguard Windsor Fund, and Participant Loans, were sold. The proceeds of the sale were reinvested in the five investment fund options available to participants (Note B). The GIC Fund and the Vanguard Windsor Fund were added as additional investment fund options available to all participants effective January 1, 1995. -11- TERRA INDUSTRIES INC. EMPLOYEES' SAVINGS AND INVESTMENT PLAN PN 333 EIN #52-1145429 ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------ Column B Column C Column D Column E Description of investment Identity of issue, including collateral, rate borrower, lessor or of interest, maturity date, Current similar party par or maturity value Cost Value Common Stock: *Terra Industries Inc. 2,054,219 shares $14,088,379 $29,015,844 Mutual Funds: Fidelity Magellan Fund 194,008 shares 13,410,941 16,680,769 *Vista Growth and Income Fund 258,470 shares 7,685,429 8,963,731 Vanguard Windsor Fund 611,298 shares 8,288,712 8,882,165 *Vista U.S. Government Income Fund 380,026 shares 4,309,759 4,415,907 *Vista U.S. Government Money Market Fund 3,621,921 shares 3,621,921 3,621,921 *American Performance Cash Management Fund 159,390 units 159,390 159,390 * Party-In-Interest
-12- TERRA INDUSTRIES INC. EMPLOYEES' SAVINGS AND INVESTMENT PLAN PN 333 EIN #52-1145429 ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES (CONTINUED) DECEMBER 31, 1995
- --------------------------------------------------------------------------------------- Column B Column C Column D Column E Description of investment Identity of issue, including collateral, rate borrower, lessor or of interest, maturity date, Current similar party par or maturity value Cost Value Common Funds: *BancOklahoma GIC Fund 177,240 units $2,677,141 $3,055,795 Bank Money Market Funds: *Chase Bank Domestic Liquidity Fund 250,961 shares 250,961 250,961 Other Investments: *Loans to Participants Principal balance of $3,136,466 bearing interest at rates ranging from 5.5% to 14% and maturing from January 1996 to September 2025 3,136,466 ----------- $78,182,949 =========== * Party-In-Interest -13-
TERRA INDUSTRIES INC. EMPLOYEES' SAVINGS AND INVESTMENT PLAN PN 333 EIN #52-1145429 ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------- Column A Column B Column C Column D Identity of Number of Number of Party Involved Description of Asset Purchases Sales Series of Transactions When Aggregated Involving an Amount in Excess of 5 Percent of the Current Value of Plan Assets - ------------------------------------------ *Terra Industries, Inc. Common Stock 46 36 Fidelity Institutional Retirement Services Company Fidelity Magellan Fund 41 41 *Chase Manhattan Bank, N.A. Vista Growth and Income Fund 33 49 The Vanguard Group Vanguard Windsor Fund 44 23 *Chase Manhattan Bank, N.A. Vista U.S. Government Money Market Fund 44 49 *BancOklahoma Trust Company American Performance Cash Management Fund 29 15 *Chase Manhattan Bank, N.A. Chase Bank Domestic Liquidity Fund 309 272 * Party-In-Interest
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 1995--Continued
- ------------------------------------------------------------------------------------------------------- Column A Column E Column F Column G Total Dollar Total Dollar Identity of Value of Value of Net Gain Party Involved Purchases Sales or (Loss) Series of Transactions When Aggregated Involving an Amount in Excess of 5 Percent of the Current Value of Plan Assets - ------------------------------------------ *Terra Industries, Inc. $5,239,150 $ 924,831 $409,853 Fidelity Institutional Retirement Services Company 5,455,292 1,734,239 619,303 *Chase Manhattan Bank, N.A. 2,480,042 1,976,250 572,188 The Vanguard Group 3,963,816 1,274,742 478,037 *Chase Manhattan Bank, N.A. 1,666,783 1,573,020 -- *BancOklahoma Trust Company 2,196,571 2,581,576 -- *Chase Manhattan Bank, N.A. 9,637,108 9,394,128 -- * Party-In-Interest
-14- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the members of the Terra Industries Inc. Employee Benefit Committee have duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. TERRA INDUSTRIES INC. EMPLOYEES' SAVINGS AND INVESTMENT PLAN Date June 28, 1996 By /s/ George H. Valentine -------------- ------------------------------------ George H. Valentine Senior Vice President, General Counsel and Corporate Secretary EX-23 2 CONSENT OF DELOITTE & TOUCHE LLP EXHIBIT E INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in Registration Statement 33-46734 on Form S-8 of our report dated April 26, 1996, appearing in this Annual Report on Form 11-K of the Terra Industries Inc. Employees' Savings and Investment Plan for the year ended December 31, 1995. DELOITTE & TOUCHE LLP Omaha, Nebraska June 20, 1996 -----END PRIVACY-ENHANCED MESSAGE-----