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): October 31, 2017

 

OTTER TAIL CORPORATION

(Exa ct name of registrant as specified in its charter)

 

    

Minnesota 0-53713 27-0383995
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)

                                          

215 South Cascade Street, P.O. Box 496, Fergus Falls, MN 56538-0496
(Address of principal executive offices) (Zip Code)

       

Registrant's telephone number, including area code: (866) 410-8780

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

__ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

__ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

__ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

__ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

 

Emerging growth company __

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. __

 

 
 

 

Item  1.01.      Entry into a Material Definitive Agreement.

 

Amendment of Otter Tail Corporation Credit Agreement

 

On October 31, 2017, Otter Tail Corporation (the “Company”) entered into an amendment dated as of October 31, 2017 (the “Fifth Amendment to OTC Credit Agreement”) to the Third Amended and Restated Credit Agreement dated as of October 29, 2012, as amended, (the “OTC Credit Agreement”) among the Company, U.S. Bank National Association, as Administrative Agent (the “OTC Agent”) and the banks party thereto from time to time (the “OTC Banks”). The OTC Credit Agreement provides for an unsecured revolving credit facility with a $130 million line of credit that the Company can draw on to refinance certain indebtedness and support the operations of the Company and its subsidiaries, and is described in and filed as Exhibit 4.1 to the Company’s Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on November 2, 2012, Exhibit 4.1 to the Company’s Form 8-K filed with the SEC on November 1, 2013, Exhibit 4.1 to the Company’s Form 8-K filed with the SEC on November 4, 2014, Exhibit 4.1 to the Company’s Form 8-K filed with the SEC on November 3, 2015 and Exhibit 4.1 to the Company’s Form 8-K filed with the SEC on November 3, 2016.

 

The Fifth Amendment to OTC Credit Agreement was entered into among the Company, the OTC Agent and the OTC Banks to extend the termination date of the facility from October 29, 2021 to October 31, 2022 and to make certain other immaterial changes consistent with provisions in similar agreements. The summary in this Item 1.01 of the material terms of the Fifth Amendment to OTC Credit Agreement is qualified in its entirety by reference to the full text of the Fifth Amendment to OTC Credit Agreement, a copy of which is filed as Exhibit 4.1 hereto and incorporated herein by reference.

 

Amendment of Otter Tail Power Company Credit Agreement

 

On October 31, 2017 , Otter Tail Power Company (“OTP”), a wholly owned subsidiary of the Company, entered into an amendment dated as of October 31, 2017 (the “Fifth Amendment to OTP Credit Agreement”) to the Second Amended and Restated Credit Agreement dated as of October 29, 2012, as amended, (the “OTP Credit Agreement”) among OTP, U.S. Bank National Association, as Administrative Agent (the “OTP Agent”), and the Banks party thereto from time to time (the “OTP Banks”). The OTP Credit Agreement provides for an unsecured revolving credit facility with a $170 million line of credit that OTP can draw on to support the working capital needs and other capital requirements of its operations, and is described in and filed as Exhibit 4.2 to the Company’s Form 8-K filed with the SEC on November 2, 2012, Exhibit 4.2 to the Company’s Form 8-K filed with the SEC on November 1, 2013, Exhibit 4.2 to the Company’s Form 8-K filed with the SEC on November 4, 2014, Exhibit 4.2 to the Company’s Form 8-K filed with the SEC on November 3, 2015, and Exhibit 4.2 to the Company’s Form 8-K filed with the SEC on November 3, 2016. 

 

The Fift h Amendment to OTP Credit Agreement was entered into among OTP, the OTP Agent and the OTP Banks to extend the termination date of the facility from October 29, 2021 to October 31, 2022, and to make certain other immaterial changes consistent with provisions in similar agreements. The summary in this Item 1.01 of the material terms of the Fifth Amendment to OTP Credit Agreement is qualified in its entirety by reference to the full text of the Fifth Amendment to OTP Credit Agreement, a copy of which is filed as Exhibit 4.2 hereto and incorporated herein by reference.

 

2
 

 

Certain Relationships

 

Certain of the banks party to one or both of the OTC Credit Agreement and the OTP Credit Agreement and/or their respective affiliates have had, and may in the future have, investment banking and other commercial dealings with the Company, OTP and their other affiliates, for which such banks or their respective affiliates have received and may in the future receive customary compensation. Such dealings have included the following: (i) U.S. Bank, JPMorgan, Bank of America, N.A. (“Bank of America”), and KeyBank National Association (“KeyBank”) are parties to both credit agreements; (ii) J.P. Morgan Securities LLC (“JPMS”), an affiliate of JPMorgan, entered into a Distribution Agreement with the Company on May 11, 2015, pursuant to which the Company may offer and sell its common shares, par value $5.00 per share, from time to time through JPMS, as the Company ’s distribution agent for the offer and sale of the shares, up to an aggregate sales price of $75,000,000; (iii) Merrill Lynch, Pierce, Fenner and Smith Incorporated (an affiliate of Bank of America) acted as placement agent in connection with the 2011 issuance by OTP of its 4.63% Senior Unsecured Notes due December 1, 2021; (iv) JPMS acted as sole placement agent in connection with a note purchase agreement entered into on August 14, 2013 for the private placement of $60 million aggregate principal amount of OTP’s 4.68% Series A Senior Unsecured Notes due February 27, 2029 and $90 million aggregate principal amount of OTP’s 5.47% Series B Senior Unsecured Notes due February 27, 2044, both issued on February 27, 2014; (v) KeyBank was the Company’s investment banker in connection with the dispositions of Aevenia, Inc. (closed February 28, 2015) and Foley Company (closed April 30, 2015); (vi) JPMorgan acted as administrative agent and JPMS acted as lead arranger and book arranger in connection with the Term Loan Agreement with the Company entered into on February 5, 2016 for a $50 million unsecured two-year term loan; and (vii) Bank of America Merrill Lynch Incorporated and US Bancorp Investments, Inc. acted as placement agents in connection with a note purchase agreement entered into on September 23, 2016 for the private placement of $80 million aggregate principal amount of the Company’s 3.55% Guaranteed Senior Notes due December 15, 2026.

 

Item 2.02        Results of Operations and Financial Condition

 

On November 1, 2017 Otter Tail Corporation issued a press release concerning consolidated financial results for the third quarter of 2017. A copy of the press release is furnished herewith as Exhibit 99.1.

 

Item 8.01        Other Events

 

On November 1, 2017 Otter Tail Power Company issued a press release concerning the filing with the North Dakota Public Service Commission of a request to increase rates in North Dakota seeking an overall increase in annual revenue of approximately $13.1 million. A copy of the press release is furnished herewith as Exhibit 99.2.

 

3
 

 

Item 9.01 Financial Statement and Exhibits

 

 

(d)

Exhibits

 

 

4.1

Fifth Amendment to Third Amended and Restated Credit Agreement, dated as of October 31, 2017, among Otter Tail Corporation, U.S. Bank National Association, as Administrative Agent and as a Bank, Bank of America, N.A. and JPMorgan Chase Bank, N.A., each as a Co-Syndication Agent and as a Bank, KeyBank National Association, as Documentation Agent and as a Bank, and Bank of the West as a Bank.

 

 

4.2

Fifth Amendment to Second Amended and Restated Credit Agreement, dated as of October 31, 2017, among Otter Tail Power Company, U.S. Bank National Association, as Administrative Agent and as a Bank, Bank of America, N.A. and JPMorgan Chase Bank, N.A., each as a Co-Syndication Agent and as a Bank, KeyBank National Association, as Documentation Agent and as a Bank, CoBank, ACB, as a Co-Documentation Agent and as a Bank, and Wells Fargo Bank, National Association as a Bank.

 

 

99.1

Otter Tail Corporation Press Release issued November 1, 2017.

     
  99.2 Otter Tail Power Company Press Release issued November 1, 2017.

 

 

 

 

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.

 

 

 

OTTER TAIL CORPORATION

 

Date: November 2, 2017

 

 

 

 

 

 

 

 

By:

/s/ Kevin G. Moug

 

 

 

  Kevin G. Moug

 

 

 

  Chief Financial Officer

 

 

        

4

Exhibit 4.1

 

FIFTH AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT

 

THIS FIFTH AMENDMENT (this “Amendment”), dated as of October 31, 2017, amends and modifies that certain Third Amended and Restated Credit Agreement, dated as of October 29, 2012 (as amended by the First Amendment thereto dated October 29, 2013, the Second Amendment thereto dated November 3, 2014, the Third Amendment thereto dated October 29, 2015 and the Fourth Amendment thereto dated October 31, 2016, the “Credit Agreement”), among Otter Tail Corporation (the “Borrower”), U.S. BANK NATIONAL ASSOCIATION, as Administrative Agent (in such capacity, the “Agent”), and the Lenders, as defined therein. Terms not otherwise expressly defined herein shall have the meanings set forth in the Credit Agreement.

 

FOR VALUE RECEIVED, the Borrower, the Lenders and the Agent agree that the Credit Agreement is amended as follows.

 

ARTICLE I - AMENDMENTS

 

1.1     The definition of “Long Term Debt Rating” appearing in Section 1.1 of the Credit Agreement is hereby amended and restated in its entirety as follows:

 

“ Long Term Debt Rating ” means the rating assigned by S&P, Moody’s or Fitch to the long term, unsecured and unsubordinated indebtedness guaranteed by the non-regulated Subsidiaries of the Borrower; provided that, in the event that any such rating agency shall cease to issue such rating on the long term, unsecured and unsubordinated indebtedness guaranteed by the non-regulated Subsidiaries of the Borrower, the “Long Term Debt Rating” of such rating agency shall be the issuer rating assigned by such rating agency to the Borrower.

 

1.2     The definition of “Termination Date” appearing in Section 1.1 of the Credit Agreement is hereby amended to replace the date “October 29, 2021” with the date “October 31, 2022”.

 

1.3    Schedule 1.1(a) (Commitments and Percentages), Schedule 1.1(b) (Material Subsidiaries), Schedule 1.1(c) (Departing Bank Schedule), Schedule 7.6 (Litigation and Contingent Liabilities), Schedule 7.15 (Subsidiaries), Schedule 7.16 (Partnerships/Joint Ventures), Schedule 9.4 (Exceptions to Ownership of Material Subsidiaries), Schedule 9.7 (Investments), Schedule 9.8 (Existing Liens) and Schedule 9.10 (Certain Transactions with Related Parties), are hereby amended in their entirety to be in the forms of Schedule 1.1(a), Schedule 1.1(b), Schedule 1.1(c), Schedule 7.6, Schedule 7.15, Schedule 7.16, Schedule 9.4, Schedule 9.7, Schedule 9.8 and Schedule 9.10 attached hereto and made a part hereof.

 

ARTICLE II - REPRESENTATIONS AND WARRANTIES

 

To induce the Agent and the Lenders to enter into this Amendment and to make and maintain the Loans under the Credit Agreement as amended hereby, the Borrower hereby warrants and represents to the Agent and the Lenders that it is duly authorized to execute and deliver this Amendment, and to perform its obligations under the Credit Agreement as amended hereby, and that this Amendment constitutes the legal, valid and binding agreement of the Borrower, enforceable in accordance with its terms, subject to limitations as to enforceability which might result from bankruptcy, insolvency, moratorium and other similar laws affecting creditors’ rights generally and subject to limitations on the availability of equitable remedies.

 

 
 

 

ARTICLE III - CONDITIONS PRECEDENT

 

This Amendment shall become effective on the date first set forth above, provided, however, that the effectiveness of this Amendment is subject to the satisfaction of each of the following conditions precedent:

 

3.1     Warranties . Before and after giving effect to this Amendment, the representations and warranties in the Credit Agreement shall be true and correct as though made on the date hereof with respect to representations and warranties containing qualifications as to materiality, and true and correct as though made on the date hereof in all material respects with respect to representations and warranties without qualifications as to materiality, except for changes that are permitted by the terms of the Credit Agreement. The execution by the Borrower of this Amendment shall be deemed a representation that the Borrower has complied with the foregoing condition.

 

3.2     Defaults . Before and after giving effect to this Amendment, no Default and no Event of Default shall have occurred and be continuing under the Credit Agreement. The execution by the Borrower of this Amendment shall be deemed a representation that the Borrower has complied with the foregoing condition.

 

3.3      Documents . The Borrower, the Agent and the Lenders shall have executed and delivered this Amendment.

 

3.4      Fees . The Agent shall have received all fees and other amounts due and payable on or prior to the date hereof, including, without limitation, (i) all fees set forth in that certain Fee Letter by and between the Borrower and the Agent dated as of October 31, 2017 and (ii) to the extent invoiced reasonably in advance, reimbursement or payment of all out-of-pocket expenses required to be reimbursed or paid by the Borrower under the Credit Agreement.

 

ARTICLE IV - GENERAL

 

4.1      Expenses . The Borrower agrees to reimburse the Agent upon demand for all reasonable expenses (including reasonable attorneys' fees and legal expenses) incurred by the Agent in the preparation, negotiation and execution of this Amendment and any other document required to be furnished herewith.

 

4.2      Counterparts . This Amendment may be executed in as many counterparts as may be deemed necessary or convenient, and by the different parties hereto on separate counterparts, each of which, when so executed, shall be deemed an original but all such counterparts shall constitute but one and the same instrument.

 

2
 

 

4.3      Severability . Any provision of this Amendment which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or affecting the validity or enforceability of such provisions in any other jurisdiction.

 

4.4      Governing Law . This Amendment shall be a contract made under the laws of the State of Minnesota, which laws shall govern all the rights and duties hereunder.

 

4.5      Successors; Enforceability . This Amendment shall be binding upon the Borrower, the Agent and the Lenders and their respective successors and assigns, and shall inure to the benefit of the Borrower, the Agent and the Lenders and the successors and assigns of the Agent and the Lenders. Except as hereby amended, the Credit Agreement shall remain in full force and effect and is hereby ratified and confirmed in all respects.

 

 

[Signature Pages Follow]

 

3
 

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized as of the date first written above.

 

 

OTTER TAIL CORPORATION

 

 

 

 

 

 

 

 

 

 

By:

/s/  Kevin Moug

 

 

 

 

 

 

Title:

             Chief Financial Officer

 

       
  4334 18 th Avenue South  
  Suite 200  
  Fargo, North Dakota 58103  
 

At tention:     Mr. Kevin G. Moug,

                      Chief Financial Officer

 
  Telephone: (701) 451-3562  
  Fax: (701) 232-4108  

       

(Signature Page to Fifth Amendment to Otter Tail Corporation Credit Agreement)
 

 

  U.S.  BANK NATIONAL ASSOCIATION,  

 

as Agent and a Bank

 

 

 

 

 

 

By:

/s/  Jacquelyn Ness

 

 

 

 

 

 

Title:

  Vice President

 

       
  505 Second Avenue North  
  Mail Code EP-ND-0630  
  Fargo, ND 58102  
  Attention: Jacquelyn Ness, Vice President  
  Telephone: (701) 280-3655  
  Fax: (701) 280-3580  

 

(Signature Page to Fifth Amendment to Otter Tail Corporation Credit Agreement)
 

 

  BANK OF AMERICA, N.A., as Co-Syndication  

 

Agent and as a Bank

 

 

 

 

 

 

By:

/s/  A. Quinn Richardson

 

 

 

 

 

 

Title:

  Senior Vice President

 

       
  IL-4135-07-65  
  135 S. LaSalle Street  
  Chicago, IL 60603  
 

Attention:     A. Quinn Richardson

                      Senior Vice President

 
  Telephone: (312) 992-2160  
  Fax: (312) 904-6546  

 

(Signature Page to Fifth Amendment to Otter Tail Corporation Credit Agreement)
 

 

 

JPMORGAN CHASE BANK, N.A., as

 

  Co-Syndication Agent and as a Bank  

 

 

 

 

 

By:

/s/  Justin Martin

 

 

 

 

 

 

Title:

  Authorized Officer

 

       
  10 South Dearborn, 9 th Floor, IL1-0090  
  Chicago, IL 60603  
  Attention: Justine Martin  
  Telephone: (312) 732-4441  
  Fax: (312) 732-1762  

 

(Signature Page to Fifth Amendment to Otter Tail Corporation Credit Agreement)
 

 

 

KEYBANK NATIONAL ASSOCIATION, as

 

  Documentation Agent and as a Bank  

 

 

 

 

 

By:

/s/  Keven D. Smith

 

 

 

 

 

 

Title:

  Senior Vice President

 

       
  127 Public Square  
  Mail Code: OH-01-27-1125  
  Cleveland, OH 44114  
  Attention: Keven D. Smith  
  Telephone: (206) 343-6966  
  Fax: (216) 689-4981  

 

(Signature Page to Fifth Amendment to Otter Tail Corporation Credit Agreement)
 

 

  BANK OF THE WEST, a California Banking  
  Corporation, as a Bank  

 

 

 

 

 

By:

/s/  David Wang

 

 

 

 

 

 

Title:

  Director

 

       
  250 Marquette Ave., Suite 575  
  Minneapolis, MN 55401  
  Attention: David Wang  
  Telephone: (612) 339-1403  
  Fax: (612) 339-6362  

 

(Signature Page to Fifth Amendment to Otter Tail Corporation Credit Agreement)
 

 

Schedule 1.1(a)

 

Commitments and Percentages

 

 

 

Initial Commitment:

   

Percentage :

 
Bank :                

U.S. Bank National Association

  $ 39,000,000       30 %

JPMorgan Chase Bank, N.A.

  $ 26,000,000       20 %
                 

Bank of America, N.A.

  $ 26,000,000       20 %

KeyBank National Association

  $ 23,833,333       18.333333076923 %

Bank of the West

  $ 15,166,667       11.666666923077 %

 

               
                 
                 

Total:

  $ 130,000,000       100 %

 

 
 

 

Schedule  1.1(b)

 

Material Subsidiaries
(as of the date of the Fourth Amended and Restated Credit Agreement)

 

 

BTD Manufacturing, Inc.

Northern Pipe Products, Inc.

Varistar Corporation

Vinyltech Corporation

 

 
 

 

Schedule 1.1(c)

 

Departing Bank Schedule

 

 

None.

 

 
 

 

Schedule  7.6

 

Litigation (Section  7.6)
Contingent Liabilities (Section 7.6)

 

Ameren Services Company, etal v. FERC DC Circuit Case No. 07-1141.   The case is an appeal from FERC challenging its treatment of MISO Revenue Sufficiency Guarantee (“RSG”) charges for entities participating in the MISO wholesale energy market since the market’s start on April 1, 2005.  Otter Tail Power was a participant in the market and could be adversely affected by certain outcomes.

 

Contingent Liabilities

Based on a potential reduction by the FERC in the ROE component of the MISO Tariff, OTP has recorded a $1.6 million liability on its balance sheet as of June 30, 2017, representing OTP ’s best estimate of a refund obligation that would arise, net of amounts that would be subject to recovery under state jurisdictional TCR riders, if FERC orders a reduction in ROE component of the MISO Tariff.

 

In 2014 the Environmental Protection Agency (EPA) published both proposed standards of performance for carbon dioxide (CO2) emissions from new, reconstructed and modified fossil fuel-fired power plants (New Source Performance Standards), and proposed CO2 emission guidelines for existing fossil fuel-fired power plants (the Clean Power Plan) under section 111 of the Clean Air Act. The EPA published final rules for each of these proposals on October 23, 2015. Both rules were challenged on legal grounds. On February  9, 2016 the U.S. Supreme Court granted a stay of the Clean Power Plan, pending disposition of petitions for review in the D.C. Circuit. The D.C. Circuit heard oral argument on challenges to the Clean Power Plan on September 27, 2016 before the full court, and a decision was expected in the first half of 2017. However, pursuant to Executive Order 13783, Promoting Energy Independence and Economic Growth, the EPA was directed to consider suspending, revising or rescinding the CO2 rules discussed above. Thereafter, the EPA issued notices in the Federal Register of its intent to review these rules pursuant to the Executive Order, and it filed motions to stay the pending litigation. The D.C. Circuit subsequently issued orders holding in abeyance the appeals of both the New Source Performance Standards and the Clean Power Plan, pending EPA review. Therefore, there is uncertainty regarding the future of both rules.

 

 
 

 

Schedule 7.15


Subsidiaries (Section 7.15)

Subsidiaries of Otter Tail Corporation

 

Company

State of

Organization

Number and Class of Shares Issued

and Owned by Otter Tail

Corporation or its Subsidiaries

Footnote

Ref.

AEV, Inc.

Minnesota

100 Shares Common

(1)

ASI, Inc.

Minnesota

100 Shares Common

(3)

BTD Manufacturing, Inc.

Minnesota

200 Shares Common

(1)

IMD, Inc.

North Dakota

980 Shares Common

(1)

Miller Welding & Iron Works, Inc.

Minnesota

1,000 Shares Common

(5)

Northern Pipe Products, Inc.

North Dakota

10,000 Shares Common

(1)

Otter Tail Assurance Limited

Cayman Islands

50,000 Shares Common

(4)

Otter Tail Energy Services Company, Inc.

Minnesota

1,000 Shares Common

(4)

Otter Tail Power Company

Minnesota

100 Shares Common

(4)

Sheridan Ridge II, LLC

Minnesota

1,000 Membership Units

(2)

Shrco, Inc.

Minnesota

100 Shares Common

(1)

T.O. Plastics, Inc.

Minnesota

100 Shares Common

(1)

Varistar Corporation

Minnesota

100 Shares Common

(4)

Vinyltech Corporation

Arizona

100 Shares Common

(1)

 

 

(1)  Subsidiary of Varistar Corporation

(2)  Subsidiary of Otter Tail Energy Services Company, Inc.

(3)  Subsidiary of Shrco, Inc.

(4)  Subsidiary of Otter Tail Corporation

(5)  Subsidiary of BTD Manufacturing, Inc.

 

 
 

 

Schedule 7.16

Partnerships and Joi nt Ventures
as of June 30, 2017

 

 



Partnership Name

 

Type of

Partnership

Interest

 

 


Ownership

Percentage

 

   

Book value of

Investment

June 30, 2017

 

 

Walnut Properties Limited – Summit Group

Limited

    15.7     $ 0  

The Homestead Limited Partnership

Limited

    89.0     $ 0  

Lincoln Square of Alexandria Limited Partnership

Limited

    89.0     $ 0  

Total

          $ 0  
                 

 

 

In the ordinary course of business, Otter Tail Power Company has entered into contractual arrangements with other regional utilities providing for ownership interests (both as tenants-in-common and discretely) in transmission and generation assets.

 

 

No Subsidiary Guarantor has any partnership or joint venture interest.

 

 
 

 

Schedule 9.4

 

Exceptions to Ownership of Material Subsidiaries (Section 9.4)

 

 

None.

 

 
 

 

Schedule  9.7

 

Investments (Section 9.7)

 

   

As of
June 30, 2017

 

Investment in Loan Pools (OTP)

    47,109  

Investments – Bank of Butterfield (OTAL)

    7,969,166  

CoBank (St Paul Bank for Coop ’s) (VSC)

    73,012  

Relocation Loans to Employees (OTP)

    50,000  

Trusts Associated with Large Transmission Projects (OTP)

    6,990,646  

Other Miscellaneous (OTP, TOP)

    66,825  
         

Total Investments of Otter Tail Corporation and Subsidiaries

  $ 15,196,758  

 

 
 

 

Schedule 9.8

 

Existing Liens (Section 9.8)

 

None.

 

 
 

 

Schedule 9.10

 

Certain Transactions with Related Parties (Section 9.10)

 

None.

Exhibit 4.2

 

FIFTH AMENDMENT TO SECOND AMENDED
AND RESTATED CREDIT AGREEMENT

 

THIS FIFTH AMENDMENT (this “Amendment”), dated as of October 31, 2017, amends and modifies that certain Second Amended and Restated Credit Agreement, dated as of October 29, 2012 (as amended by the First Amendment thereto dated October 29, 2013, the Second Amendment thereto dated November 3, 2014, the Third Amendment thereto dated October 29, 2015 and the Fourth Amendment thereto dated October 31, 2016, the “Credit Agreement”), among Otter Tail power company (the “Borrower”), U.S. BANK NATIONAL ASSOCIATION, as Administrative Agent (in such capacity, the “Agent”), and the Lenders, as defined therein. Terms not otherwise expressly defined herein shall have the meanings set forth in the Credit Agreement.

 

FOR VALUE RECEIVED, the Borrower, the Lenders and the Agent agree that the Credit Agreement is amended as follows.

 

ARTICLE I - AMENDMENTS

 

1.1     The definition of “Long Term Debt Rating” appearing in Section 1.1 of the Credit Agreement is hereby amended and restated in its entirety as follows:

 

“ Long Term Debt Rating ” means the rating assigned by S&P, Moody’s or Fitch to the long term, unsecured and unsubordinated indebtedness of the Borrower; provided that, in the event that any such rating agency shall cease to issue such rating on the Borrower’s long term, unsecured and unsubordinated indebtedness, the “Long Term Debt Rating” of such rating agency shall be the issuer rating assigned by such rating agency to the Borrower.

 

1.2       The definition of “Termination Date” appearing in Section 1.1 of the Credit Agreement is hereby amended to replace the date “October 29, 2021” with the date “October 31, 2022”.

 

1.3     Schedule 1.1(a) (Commitments and Percentages), Schedule 1.1(b) (Material Subsidiaries), Schedule 7.6 (Litigation and Contingent Liabilities), Schedule 7.15 (Subsidiaries), Schedule 7.16 (Partnerships/Joint Ventures), Schedule 9.4 (Stock Ownership Transactions), Schedule 9.7 (Investments), Schedule 9.8 (Liens) and Schedule 9.10 (Transactions with Related Parties), are hereby amended in their entirety to be in the forms of Schedule 1.1(a), Schedule 1.1(b), Schedule 7.6, Schedule 7.15, Schedule 7.16, Schedule 9.4, Schedule 9.7, Schedule 9.8 and Schedule 9.10 attached hereto and made a part hereof.

 

ARTICLE II - REPRESENTATIONS AND WARRANTIES

 

To induce the Agent and the Lenders to enter into this Amendment and to make and maintain the Loans under the Credit Agreement as amended hereby, the Borrower hereby warrants and represents to the Agent and the Lenders that it is duly authorized to execute and deliver this Amendment, and to perform its obligations under the Credit Agreement as amended hereby, and that this Amendment constitutes the legal, valid and binding agreement of the Borrower, enforceable in accordance with its terms, subject to limitations as to enforceability which might result from bankruptcy, insolvency, moratorium and other similar laws affecting creditors’ rights generally and subject to limitations on the availability of equitable remedies.

 

 
 

 

ARTICLE III - CONDITIONS PRECEDENT

 

This Amendment shall become effective on the date first set forth above, provided, however, that the effectiveness of this Amendment is subject to the satisfaction of each of the following conditions precedent:

 

3.1     Warranties . Before and after giving effect to this Amendment, the representations and warranties in the Credit Agreement shall be true and correct as though made on the date hereof with respect to representations and warranties containing qualifications as to materiality, and true and correct as though made on the date hereof in all material respects with respect to representations and warranties without qualifications as to materiality, except for changes that are permitted by the terms of the Credit Agreement. The execution by the Borrower of this Amendment shall be deemed a representation that the Borrower has complied with the foregoing condition.

 

3.2      Defaults . Before and after giving effect to this Amendment, no Default and no Event of Default shall have occurred and be continuing under the Credit Agreement. The execution by the Borrower of this Amendment shall be deemed a representation that the Borrower has complied with the foregoing condition.

 

3.3      Documents . The Borrower, the Agent and the Lenders shall have executed and delivered this Amendment.

 

3.4      Fees . The Agent shall have received all fees and other amounts due and payable on or prior to the date hereof, including, without limitation, (i) all fees set forth in that certain Fee Letter by and between the Borrower and the Agent dated as of October 31, 2017 and (ii) to the extent invoiced reasonably in advance, reimbursement or payment of all out-of-pocket expenses required to be reimbursed or paid by the Borrower under the Credit Agreement.

 

ARTICLE IV - GENERAL

 

4.1      Expenses . The Borrower agrees to reimburse the Agent upon demand for all reasonable expenses (including reasonable attorneys' fees and legal expenses) incurred by the Agent in the preparation, negotiation and execution of this Amendment and any other document required to be furnished herewith.

 

4.2      Counterparts . This Amendment may be executed in as many counterparts as may be deemed necessary or convenient, and by the different parties hereto on separate counterparts, each of which, when so executed, shall be deemed an original but all such counterparts shall constitute but one and the same instrument.

 

2
 

 

4.3      Severability . Any provision of this Amendment which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or affecting the validity or enforceability of such provisions in any other jurisdiction.

 

4.4      Governing Law . This Amendment shall be a contract made under the laws of the State of Minnesota, which laws shall govern all the rights and duties hereunder.

 

4.5     Successors; Enforceability . This Amendment shall be binding upon the Borrower, the Agent and the Lenders and their respective successors and assigns, and shall inure to the benefit of the Borrower, the Agent and the Lenders and the successors and assigns of the Agent and the Lenders. Except as hereby amended, the Credit Agreement shall remain in full force and effect and is hereby ratified and confirmed in all respects.

 

 

[Signature Pages Follow]

 

3
 

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized as of the date first written above.

 

 

OTTER TAIL POWER COMPANY

 

 

 

 

 

 

 

 

 

 

By:

/s/  Kevin Moug

 

 

 

 

 

 

Title:

              Treasurer

 

       
  4334 18 th Avenue South  
  Suite 200  
  Fargo, North Dakota 58103  
 

Attention:      Mr. Kevin G. Moug,

                      Treasurer

 
  Telephone: (701) 451-3562  
  Fax: (701) 232-41 08  

       

(Signature Page to Fifth Amendment to Otter Tail Power Company Credit Agreement)
 

 

 

U.S.  BANK NATIONAL ASSOCIATION,

 

  as Agent and a Bank  

 

 

 

 

 

By:

/s/  Jacquelyn Ness

 

 

 

 

 

 

Title:

  Vice President

 

       
  505 Second Avenue North  
  Mail Code EP-ND-0630  
  Fargo, ND 58102  
  Attention: Jacquelyn Ness, Vice President  
  Telephone: (701) 280-3655  
  Fax: (701) 280-3580  

 

(Signature Page to Fifth Amendment to Otter Tail Power Company Credit Agreement)
 

 

 

JPMORGAN CHASE BANK, N.A., as a Co-

 

  Syndication Agent and as a Bank  

 

 

 

 

 

By:

/s/  Justin Martin

 

       

 

Title:

  Authorized Officer

 

       

 

10 South Dearborn, 9th Floor, IL1-0090

 

  Chicago, IL 60603  
  Attention: Justin Martin  
  Telephone: (312) 732-4441  
  Fax: (312) 732-1762  

 

(Signature Page to Fifth Amendment to Otter Tail Power Company Credit Agreement)
 

 

 

BANK OF AMERICA, N.A., as Co-Syndication

 

  Agent and as a Bank  

 

 

 

 

 

By:

/s/  A. Quinn Richardson

 

 

 

 

 

 

Title:

  Senior Vice President

 

       
  IL-4135-07-65  
  135 S. LaSalle Street  
  Chicago, IL 60603  
 

Attention:      A. Quinn Richardson

                      Senior Vice President

 
  Telephone: (312) 992-2160  
  Fax: (312) 904-6546  
     
(Signature Page to Fifth Amendment to Otter Tail Power Company Credit Agreement)
 

 

  KEYBANK NATIONAL ASSOCIATION, as  

 

Documentation Agent and as a Bank

 

 

 

 

 

 

By:

/s/  Keven D. Smith

 

 

 

 

 

 

Title:

  Senior Vice President

 

       
  127 Public Square  
  Mail Code: OH-01-27-1125  
  Cleveland, OH 44114  
  Attention: Keven D. Smith  
  Telephone: (206) 343-6966  
  Fax: (216) 689-4981  

 

(Signature Page to Fifth Amendment to Otter Tail Power Company Credit Agreement)
 

 

 

WELLS FARGO BANK, NATIONAL

 

  ASSOCIATION, as a Bank  

 

 

 

 

 

By:

/s/  Keith Luettel

 

 

 

 

 

 

Title:

  Director

 

       
  90 S 7 th Street, 7 th Floor  
  MAC: N9305-070  
  Minneapolis, MN 55408  
  Attention: Keith Luettel  
  Tel: 612-667-4747  
  Fax: 612-316-0506  

 

(Signature Page to Fifth Amendment to Otter Tail Power Company Credit Agreement)
 

 

 

COBANK, ACB, as a Co-Documentation Agent

 

  and as a Bank  

 

 

 

 

 

By:

/s/  John Kemper

 

 

 

 

 

 

Title:

  Vice President

 

       
 

5500 South Quebec St.

 
  Greenwood Village, CO 80111  
  Attention: John Kemper  
  Telephone: 303-740-6576  
  Fax: 303-224-2615  

 

(Signature Page to Fifth Amendment to Otter Tail Power Company Credit Agreement)
 

 

Schedule 1.1(a)

 

Commitments and Percentages

 

 

 

 

Initial Commitment :

   

Percentage:

 
Bank:                
                 

U.S. Bank National Association

  $ 52,500,000       30.882352941176 %

JPMorgan Chase Bank, N.A.

  $ 32,500,000       19.117647058824 %

Bank of America, N.A.

  $ 32,500,000       19.117647058824 %

KeyBank National Association

  $ 17,500,000       10.294117647059 %

CoBank, ACB

  $ 17,500,000       10.294117647059 %

Wells Fargo Bank, National Association

  $ 17,500,000       10.294117647059 %

 

               
                 

Total:

  $ 170,000,000       100 %

 

 
 

 

Schedule 1.1(b)

 

Material Subsidiaries of Otter Tail Power Company

 

None

 

 
 

 

Schedule 7.6

 

Litigation (Section  7.6)
Contingent Liabilities (Section 7.6)

 

 

Ameren Services Company, etal v. FERC DC Circuit Case No. 07-1141.   The case is an appeal from FERC challenging its treatment of MISO Revenue Sufficiency Guarantee (“RSG”) charges for entities participating in the MISO wholesale energy market since the market’s start on April 1, 2005.  Otter Tail Power was a participant in the market and could be adversely affected by certain outcomes.

 

Contingent Liabilities

 

Based on a potential reduction by the FERC in the ROE component of the MISO Tariff, OTP has recorded a $1.6 million liability on its balance sheet as of June 30, 2017, representing OTP ’s best estimate of a refund obligation that would arise, net of amounts that would be subject to recovery under state jurisdictional TCR riders, if FERC orders a reduction in ROE component of the MISO Tariff.

 

In 2014 the Environmental Protection Agency (EPA) published both proposed standards of performance for carbon dioxide (CO2) emissions from new, reconstructed and modified fossil fuel-fired power plants (New Source Performance Standards), and proposed CO2 emission guidelines for existing fossil fuel-fired power plants (the Clean Power Plan) under section 111 of the Clean Air Act. The EPA published final rules for each of these proposals on October 23, 2015. Both rules were challenged on legal grounds. On February  9, 2016 the U.S. Supreme Court granted a stay of the Clean Power Plan, pending disposition of petitions for review in the D.C. Circuit. The D.C. Circuit heard oral argument on challenges to the Clean Power Plan on September 27, 2016 before the full court, and a decision was expected in the first half of 2017. However, pursuant to Executive Order 13783, Promoting Energy Independence and Economic Growth, the EPA was directed to consider suspending, revising or rescinding the CO2 rules discussed above. Thereafter, the EPA issued notices in the Federal Register of its intent to review these rules pursuant to the Executive Order, and it filed motions to stay the pending litigation. The D.C. Circuit subsequently issued orders holding in abeyance the appeals of both the New Source Performance Standards and the Clean Power Plan, pending EPA review. Therefore, there is uncertainty regarding the future of both rules.

 

 
 

 

Schedule 7.15
Subsidiaries (Section 7.15)

 

None.

 

 
 

 

Schedule 7.16

 

Partnerships/Joint Ventures (Section  7.16)

 

 

 

In the ordinary course of business, the Borrower has entered into contractual arrangements with other regional utilities providing for ownership interests (both as tenants-in-common and discretely) in tran smission and generation assets.

 

 
 

 

Schedule 9.4

 

Stock Ownership Transactions (Section  9.4)

 

None.

 

 
 

 

Schedule 9.7

 

Investments (Section 9.7)

 

Otter Tail Power Company
Detail of Investments

 

   

As of

June 30, 2017

 

Investment in Loan Pools

  $ 47,109  

Relocation Loans to Employee

    50,000  

Trusts Associated With Large Joint Transmission Projects

    6,990,646  

Other Miscellaneous

    24,350  
    $ 7,112,105  

 

 
 

 

Schedule 9.8

 

Liens (Section 9.8)

 

 

None.

 

 
 

 

Schedule 9.10
Transactions with Related Parties (Section 9.10)

 

 

None.

                                                 

Exhibit 99.1  

NEWS RELEASE

 

Media contact:

Cris Oehler, Vice President of Corporate Communications, (218) 531-0099 or (866) 410-8780

Investor contact:

Loren Hanson, Manager of Investor Relations, (218) 739-8481 or (800) 664-1259

 

For release:       November 1, 2017

Financial Media

          

Otter Tail Corporation Announces Third Quarter Earnings ;

Raises 2017 Earnings Guidance to be in the Range of $1. 7 5 to $1.8 5 ; Board of Directors Declares Quarterly Dividend

 

FERGUS FALLS, Minnesota - Otter Tail Corporation (NASDAQ: OTTR) today announced financial results for the quarter ended September 30, 2017.

 

Summary:

 

 

●

Consolidated operating revenues were $216.5 million compared with $197.2 million for the third quarter of 2016.

 

 

●

Consolidated n et income and diluted earnings from continuing operations totaled $17.8 million and $0.45 per share, respectively, compared with $14.6 million and $0.37 per share for the third quarter of 2016.

 

 

●

Otter Tail Corporation raises its 2017 earnings guidance to be in the range of $1.75 to $1.85 per diluted share driven by strong performance in our Plastics segment.

 

CEO Overview

“Otter Tail employees delivered improved quarter-over-quarter earnings for the third consecutive quarter this year,” said Otter Tail Corporation President and CEO Chuck MacFarlane. “2017 third quarter earnings per share were $0.45, compared with $0.37 in the third quarter of 2016. Our Plastics segment drove the improvement as the PVC pipe companies sold more pounds and earned higher margins than expected , in part due to hurricane-related market dynamics that occurred in September. Manufacturing segment earnings and corporate costs were improved from last year’s third quarter. Utility earnings were down primarily due to a final true up to the estimated interim rate refund provision for Otter Tail Power Company’s 2016 Minnesota rate case.

 

1
 

 

“In addition to strong PVC pipe sales, highlights of the quarter included the September 8 energization of the Big Stone South-Brookings line, one of two 345-kilovolt regional transmission projects in which we have invested. The Midcontinent Independent System Operator (MISO) has designated both as Multi-Value Projects (MVPs). We are a 50 percent owner of the Big Stone South-Brookings project, completed on schedule and under budget. We also are a 50 percent owner of the Big Stone South-Ellendale project, scheduled for completion in 2019. Otter Tail Power Company is the project manager, has obtained all easements for the route, and has set two thirds of the structures. Our combined investment in these two transmission projects will be approximately $250 million. Cost recovery for these MVP-designated investments will come from customers across MISO’s multi-state footprint.

 

“Otter Tail Power Company expects to invest $862 million from 2017 through 2021, including investments in these two regional transmission projects as well as new natural gas and wind generation associated with the company ’s approved integrated resource plan. This will produce a projected compounded annual growth rate of 7.5 percent in utility rate base from 2015 through 2021.

 

“The Minnesota Public Utilities Commission approved our resource plan earlier this year, and we have filed a request for advance determination of prudence for our natural gas and wind generation projects with the North Dakota Public Service Commission (PSC). We have reached a settlement agreement with North Dakota PSC staff on the request for advance determination and expect the North Dakota PSC to rule on it by the end of the year.

 

“Otter Tail Power Company will file a request with the North Dakota PSC on November 2, 2017, for an increase in general rates in North Dakota. Investments in a cleaner, stronger infrastructure and overall increasing costs are driving the request. The North Dakota PSC set the company’s current rates in 2009 based on 2007 costs. The company will propose to increase revenues from non-fuel base rates by $13.1 million, or 8.7 percent. Even with this increase Otter Tail Power Company will continue to have some of the lowest rates in the country.

 

“With third quarter results exceeding our expectations for the Plastics segment, we are raising our previously announced 2017 earnings per share guidance range of $1.65 to $1.80 and now expect 2017 earnings to be in the range of $1.75 to $1.85 per diluted share. Employees continue to successfully execute on our strategy.”

 

C ash Flow from Operations , and Liquidity

Consolidated cash provided by continuing operations for the nine months ended September 30, 2017 was $114.2 million compared with $115.1 million for the nine months ended September 30, 2016. The $0.9 million decrease in cash provided by continuing operations includes a $9.3 million increase in net income from continuing operations and a $10.0 million reduction in discretionary contributions to our funded pension plan, offset by a $19.5 million increase in cash used for working capital. The increase in cash used for working capital between the periods is primarily due to a $21.1 million increase in receivables in the first nine months of 2017 compared with only a $3.5 million increase in the first nine months of 2016, mainly as a result of a significant increase in receivables in the Plastics segment due to strong polyvinyl chloride (PVC) pipe sales in the third quarter of 2017.

 

2
 

 

The following table presents the status of the corporation’s lines of credit:

 

(in thousands)

 

Line Limit

   

In Use On

September 30,

2017

   

Restricted due to

Outstanding

Letters of Credit

   

Available on

September 30,

2017

   

Available on

December 31,

201 6

 

Otter Tail Corporation Credit Agreement

  $ 130,000     $ 1,417     $ --     $ 128,583     $ 130,000  

Otter Tail Power Company Credit Agreement

    170,000       102,220       300       67,480       127,067  

Total

  $ 300,000     $ 103,637     $ 300     $ 196,063     $ 257,067  

 

On October 31, 2017 both credit agreements were amended to extend the expiration dates by one year from October 29, 2021 to October 31, 2022.

 

Board of Directors Declared Quarterly Dividend  

On November 1, 2017 the corporation’s Board of Directors declared a quarterly common stock dividend of $0.32 per share. This dividend is payable December 9, 2017 to shareholders of record on November 15, 2017.

 

Segment Performance Summary

 

Electric

 

   

Three Months ended September 30,

                 

( $s in thousands)

 

201 7

   

201 6

   

Change

   

% Change

 

Retail Electric Revenues

  $ 88,953     $ 87,755     $ 1,198       1.4  

Wholesale Electric Revenues

    1,549       1,656       (107 )     (6.5 )

Other Electric Revenues

    12,897       13,312       (415 )     (3.1 )

Total Electric Revenues

  $ 103,399     $ 102,723     $ 676       0.7  

Net Income

  $ 10,869     $ 12,513     $ (1,644 )     (13.1 )

Heating Degree Days

    37       23       14       60.9  

Cooling Degree Days

    284       317       (33 )     (10.4 )

 

The following table shows cooling degree days as a percent of normal:

 

   

Three Months ended September 30,

 
   

2017

   

201 6

 

Cool ing Degree Days

    80.2 %     89.5 %

 

The following table summarizes the estimated effect on diluted earnings per share of the difference in retail kilowatt-hour (kwh) sales under actual weather conditions and expected retail kwh sales under normal weather conditions in the third quarters of 2017 and 2016 and between the quarters:

 

   

Three Months ended September 30,

 
   

201 7 vs Normal

   

201 6 vs Normal

   

201 7 vs 2016

 

Effect on Diluted Earnings Per Share

  $ (0.014 )   $ (0.008 )   $ (0.006 )

 

3
 

 

The $ 1.2 million increase in retail electric revenues includes:

 

 

●

A $3.3 million increase in retail revenue related to the recovery of increased fuel and purchased power costs due to a 43.2% increase in kwhs purchased and a 12.8% increase in fuel costs per kwh generated to serve retail customers, partially offset by an 18.6% decrease in the price per kwh purchased.

 

 

●

A $0.3 million increase in revenue related to the recovery of increased conservation improvement program costs.

 

offset by:

 

 

●

A $1.4 million net decrease in interim rate revenues, Environmental Costs Recovery rider revenues and Transmission Cost Recovery rider revenues. This is mainly due to a true up for the lower return on equity (ROE) and other components granted by the Minnesota Public Utilities Commission (MPUC) in its final order in Otter Tail Power Company's 2016 Minnesota general rate case and for items included in Otter Tail Power Company’s final compliance filing, filed during the third quarter of 2017.

 

 

●

A $0. 6 million decrease in revenue related to a 3.1% decrease in retail kwh sales, mostly to industrial customers.

 

 

●

A $0.4 million decrease in revenues due to lower electricity usage due to the 10.4% decrease in cooling degree days between the quarters.

 

Other electric revenues decreased as a result of a $0.4 million decrease in integrated transmission service revenues.

 

Production fuel costs increased $ 1.3 million as a result of a 10.1% increase in the cost of fuel per kwh generated from our steam-powered and combustion turbine generators. The increase in fuel costs and the cost of fuel per kwh generated was due to an increase in kwhs generated from Otter Tail Power Company’s higher-fuel-cost Hoot Lake Plant and an increase in the fuel cost per kwh generated at Coyote Station.

 

The cost of purchased power to serve retail customers increased $1.9 million as a result of a 43.2% increase in kwhs purchased, offset by an 18.6% decrease in the cost per mwh purchased.

 

Other e lectric operating and maintenance expenses increased $0.4 million as a result of:

 

 

●

A $0.9 million increase in labor and benefit expenses mostly related to higher medical expenses and increased post-retirement medical benefit costs.

 

 

●

A $0.3 million increase in conservation improvement program expenditures.

 

 

●

A $0.2 million increase in software licensing and subscription expenses .

 

offset by:

 

 

●

A $1.0 million reduction in storm damage repair expenses compared to the third quarter of 2016, mostly associated with excessive storm damage from a large storm in July 2016 in the Bemidji service area.

 

4
 

 

Depreciation and amortization expense decreased $0.3 million as a result of extending the depreciable lives of certain assets and other assets reaching the end of their depreciable lives in 2016.

 

P roperty tax expense increased $0.2 million mainly due to transmission line additions in South Dakota related to the construction of the Big Stone South-Ellendale and Big Stone South-Brookings 345 kV transmission lines.

 

Income tax expense in the Electric segment decreased $1.2 million mainly as a result of a $2.8 million decrease in income before income taxes.

 

 

Manufacturing

 

   

Three Months ended September 30,

                 

(in thousands)

 

2017

   

2016

   

Change

   

% Change

 

Operating Revenues

  $ 54,355     $ 52,171     $ 2,184       4.2  

Net Income

    1,608       1,246       362       29.1  

 

At BTD Manufacturing, Inc. (BTD), revenues increased $1.4 million. This is due to an increase in product sales from BTD’s Illinois and Georgia manufacturing facilities and an increase in scrap revenues due to increased volume and higher scrap-metal prices. Cost of products sold increased $0.4 million and operating expenses increased $0.7 million between the quarters. These items combined resulted in improved operating margins in the third quarter of 2017 compared with the third quarter of 2016. A $0.3 million decrease in interest expense as a result of the December 2016 refinancing of long-term debt at lower interest rates was offset by a $0.4 million increase in income tax expense, resulting in a $0.2 million increase in quarter-over-quarter net income at BTD.

 

At T.O. Plastics, Inc. (T.O. Plastics), revenues increased $0.8 million, including increases of $0.5 million from sales of life science products and $0.2 million from sales of industrial products. Costs of products sold increased $0.6 million due to the increase in sales while operating expenses increased $0.1 million, resulting in a better than $0.1 million increase in net income at T.O. Plastics.

 

Plastics

 

   

Three Months ended September 30,

                 

(in thousands)

 

2017

   

2016

   

Change

   

% Change

 

Operating Revenues

  $ 58,708     $ 42,292     $ 16,416       38.8  

Net Income

    6,092       2,346       3,746       159.7  

 

Plastic s segment revenues and net income increased $16.4 million and $3.7 million, respectively, as a result of a 22.9% increase in pounds of PVC pipe sold and a 13.0% increase in PVC pipe prices between the quarters. Quarter over quarter improvement in our normal business operations provided approximately $2.0 million or $0.05 per diluted share of the $3.7 million increase in net income or $0.09 in earnings per diluted share. The remaining increase of $1.7 million in net income or $0.04 in earnings per diluted share is mainly due to increased sales and pricing affected by hurricanes in the Gulf Coast region of the United States, where the major U.S. resin production plants are located. Hurricane Harvey had a significant impact on market conditions for September. Major resin suppliers shut down production facilities which impacted raw material availability. This created concerns of pipe availability by distributors and contractors which resulted in accelerated pipe demand and created positive sales price pressure in the market. Even though Hurricane Harvey impacted raw material availability, we had sufficient raw materials in September to run our plants and meet the additional demand.

 

5
 

 

Corporate

 

Corporate ’s net-of-tax costs decreased $0.7 million as a result of decreases in salary, benefit and insurance costs and reduced interest and equipment repair expenses.

 

 

201 7 Business Outlook

 

With third quarter results exceeding our expectations for the Plastics segment, we are raising our previously announced guidance range of $1.65 to $1.80 per diluted share to $1.75 to $1.85 per diluted share. This guidance reflects the current mix of businesses we own, considers the cyclical nature of some of our businesses, and reflects current regulatory factors and economic challenges facing our Electric, Manufacturing and Plastics segments. It also reflects strategies for improving future operating results. We expect capital expenditures for 2017 to be $130 million compared with actual cash used for capital expenditures of $161 million in 2016. Planned expenditures for 2017 include investments in two large transmission line projects for the Electric segment, which positively impact earnings by providing an immediate return on invested funds through rider recovery mechanisms.

 

Segment components of our 2017 earnings per share guidance range compared with 2016 actual earnings are as follows:

 

   

201 6

   

2017 Guidance

 

 

  EPS by    

February 6, 2017

   

August 7 , 2017

   

November 1 , 2017

 

Diluted Earnings Per Share

  Segment    

Low

   

High

   

Low

   

High

   

Low

   

High

 

Electric

  $ 1.29     $ 1.31     $ 1.34     $ 1.31     $ 1.34     $ 1.27     $ 1.29  

Manufacturing

  $ 0.15     $ 0.17     $ 0.21     $ 0.17     $ 0.21     $ 0.19     $ 0.21  

Plastics

  $ 0.27     $ 0.26     $ 0.30     $ 0.31     $ 0.35     $ 0.43     $ 0.45  

Corporate

  $ (0.11 )   $ (0.14 )   $ (0.10 )   $ (0.14 )   $ (0.10 )   $ (0.14 )   $ (0.10 )

Total – Continuing Operations

  $ 1.60     $ 1.60     $ 1.75     $ 1.65     $ 1.80     $ 1.75     $ 1.85  

Return on Equity

    9.8 %     9.3 %     10.2 %     9.7 %     10.5 %     10.2 %     10.8 %

 

Contributing to our earnings guidance for 2017 are the following items:

 

 

●

We expect 2017 Electric segment net income to be higher than 2016 segment net income based on:

 

 

o

Normal weather for the remainder of 2017. Milder than normal weather in 2016 negatively impacted diluted earnings per share by $0.07. Milder than normal weather has negatively impacted diluted earnings per share by $0.04 through the nine months ended September 30, 2017.

 

6
 

 

 

o

A full year of increased rates compared with 8.5 months in 2016. In March 2017, the Minnesota Public Utilities Commission granted Otter Tail Power Company a revenue increase of approximately 6.2% with a 9.41% ROE.

 

 

o

Rider recovery increases from transmission riders related to the Electric segment’s continuing investments in its share of the MVPs in South Dakota offset by declining environmental riders due to decreasing rate base.

 

 

o

I ncreased kwh sales to industrial and commercial customers.

 

offset by:  

 

 

o

Increased operating and maintenance expenses of $0.0 5 per share due to inflationary increases and increasing benefit costs. Included is an increase in pension costs as a result of a decrease in the discount rate from 4.76% to 4.60% and a decrease in the assumed long-term rate of return on plan assets from 7.75% to 7.50%.

 

 

o

Higher property tax expense due to large capital projects being put into service.

 

 

o

Lower Conservation Improvement Program (CIP) incentives of $0.03 per share in Minnesota as a result of program changes made by the Minnesota Department of Commerce that reduced the CIP incentive cap by 32.5% compared to 2016.

 

 

o

Increased costs related to contractual price increases in certain capacity agreements.

 

 

●

We expect 2017 net income from our Manufacturing segment to increase over 2016 due to:

 

 

o

A slight increase in sales at BTD due to capturing new business with existing customers, higher scrap sales and higher lawn and garden end market sales.

 

 

o

Improved margins on parts and tooling sales at BTD combined with lower interest costs from refinancing long-term debt at a lower interest rate in the fourth quarter of 2016.

 

 

o

An increase in earnings from T.O. Plastics mainly driven by year-over-year sales growth in our horticulture , life science and industrial markets and lower interest costs from refinancing long-term debt at a lower interest rate in the fourth quarter of 2016.

 

 

o

Backlog for the manufacturing companies of approximately $53 million for 2017 compared with $42 million one year ago.

 

 

●

We are raising our 2017 net income expectations from the Plastics segment to be higher than our original plan and our August 2017 guidance. The reasons for this increase are:

 

 

o

T he strong results through the first nine months of 2017.

 

7
 

 

 

o

T he impact of Hurricane Harvey on market conditions from September through December. Harvey made landfall on August 25th. As the storm progressed, major resin suppliers shut down production facilities which impacted raw material availability. This created concerns of pipe availability by distributors and contractors which resulted in accelerated pipe demand and created positive sales price pressure in the market. When comparing the low end of the updated earnings per share range for the Plastics segment to the 2016 earnings per share, $0.08 of the increase is due to improved profitability from normal business operations and $0.08 is due to the impact of Hurricane Harvey on business conditions.

 

 

o

L ower interest costs in 2017 resulting from the long-term debt refinancing completed in the fourth quarter of 2016.

 

 

●

Corporate costs in 2017 are expected to be in line with 2016 costs.

 

 

CONFERENCE CALL AND WEBCAST  

The corporation will host a live webcast on Thursday, November 2, 2017 at 10:00 a.m. CDT to discuss its financial and operating performance.

 

The presentation will be posted on our website before the webcast. To access the live webcast go to www.ottertail.com/presentations.cfm and select “Webcast.” Please allow extra time prior to the call to visit the site and download any software needed to listen to the webcast. An archived copy of the webcast will be available on our website shortly following the call.

 

If you are i nterested in asking a question during the live webcast , the Dial-In Number is: 877-312-8789 , otherwise the listen only mode can be accessed by dialing 866-634-1342 .

 

 

Risk Factors and Forward-Looking Statements that Could Affect Future Results

The information in this release includes certain forward-looking information, including 201 7 expectations, made under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Although we believe our expectations are based on reasonable assumptions, actual results may differ materially from those expectations. The following factors, among others, could cause our actual results to differ materially from those discussed in the forward-looking statements:

 

 

●

Federal and state environmental regulation could require us to incur substantial capital expenditures and increased operating costs.

 

 

●

Volatile financial markets and changes in our debt ratings could restrict our ability to access capital and increase borrowing costs and pension plan and postretirement health care expenses.

 

 

●

We rely on access to both short- and long-term capital markets as a source of liquidity for capital requirements not satisfied by cash flows from operations. If we are unable to access capital at competitive rates, our ability to implement our business plans may be adversely affected.

 

 

●

Disruptions, uncertainty or volatility in the financial markets can also adversely impact our results of operations, the ability of customers to finance purchases of goods and services, and our financial condition, as well as exert downward pressure on stock prices and/or limit our ability to sustain our current common stock dividend level.

 

 

●

We could be required to contribute additional capital to the pension plan in the future if the market value of pension plan assets significantly declines, plan assets do not earn in line with our long-term rate of return assumptions or relief under the Pension Protection Act is no longer granted.

 

8
 

 

 

●

Any significant impairment of our goodwill would cause a decrease in our asset values and a reduction in our net operating income.

 

 

●

Declines in projected operating cash flows at BTD or the Plastics segment may result in goodwill impairments that could adversely affect our results of operations and financial position, as well as financing agreement covenants.

 

 

●

The inability of our subsidiaries to provide sufficient earnings and cash flows to allow us to meet our financial obligations and debt covenants and pay dividends to our shareholders could have an adverse effect on us.

 

 

●

We rely on our information systems to conduct our business and failure to protect these systems against security breaches or cyber-attacks could adversely affect our business and results of operations. Additionally, if these systems fail or become unavailable for any significant period of time, our business could be harmed.

 

 

●

Economic conditions could negatively impact our businesses.

 

 

●

If we are unable to achieve the organic growth we expect, our financial performance may be adversely affected.

 

 

●

Our plans to grow and realign our business mix through capital projects, acquisitions and dispositions may not be successful, which could result in poor financial performance.

 

 

●

We may, from time to time, sell assets to provide capital to fund investments in our electric utility business or for other corporate purposes, which could result in the recognition of a loss on the sale of any assets sold and other potential liabilities. The sale of any of our businesses could expose us to additional risks associated with indemnification obligations under the applicable sales agreements and any related disputes.

 

 

●

Significant warranty claims and remediation costs in excess of amounts normally reserved for such items could adversely affect our results of operations and financial condition.

 

 

●

We are subject to risks associated with energy markets.

 

 

●

Changes in tax laws, as well as judgments and estimates used in the determination of tax-related asset and liability amounts, could materially adversely affect our business, financial condition, results of operations and prospects.

 

 

●

We may experience fluctuations in revenues and expenses related to our electric operations, which may cause our financial results to fluctuate and could impair our ability to make distributions to our shareholders or scheduled payments on our debt obligations, or to meet covenants under our borrowing agreements.

 

 

●

Actions by the regulators of our electric operations could result in rate reductions, lower revenues and earnings or delays in recovering capital expenditures.

 

 

●

Otter Tail Power Company ’s operations are subject to an extensive legal and regulatory framework under federal and state laws as well as regulations imposed by other organizations that may have a negative impact on our business and results of operations.

 

 

●

Otter Tail Power Company ’s electric transmission and generation facilities could be vulnerable to cyber and physical attack that could impair its ability to provide electrical service to its customers or disrupt the U.S. bulk power system.

 

 

●

Otter Tail Power Company ’s electric generating facilities are subject to operational risks that could result in unscheduled plant outages, unanticipated operation and maintenance expenses and increased power purchase costs.

 

9
 

 

 

●

Changes to regulation of generating plant emissions, including but not limited to carbon dioxide emissions, could affect our operating costs and the costs of supplying electricity to our customers.

 

 

●

Competition from foreign and domestic manufacturers, the price and availability of raw materials, prices and supply of scrap or recyclable material and general economic conditions could affect the revenues and earnings of our manufacturing businesses.

 

 

●

Our plastics operations are highly dependent on a limited number of vendors for PVC resin and a limited supply of resin. The loss of a key vendor, or any interruption or delay in the supply of PVC resin, could result in reduced sales or increased costs for this segment.

 

 

●

We compete against a large number of other manufacturers of PVC pipe and manufacturers of alternative products. Customers may not distinguish the pipe companies ’ products from those of our competitors.

 

 

●

Changes in PVC resin prices can negatively affect our plastics business.

 

 

For a further discussion of other risk factors and cautionary statements, refer to reports we file with the Securities and Exchange Commission.

 

About The Corporation: Otter Tail Corporation has interests in diversified operations that include an electric utility and manufacturing businesses. Otter Tail Corporation stock trades on the NASDAQ Global Select Market under the symbol OTTR. The latest investor and corporate information is available at www.ottertail.com . Corporate offices are located in Fergus Falls, Minnesota, and Fargo, North Dakota.

 

See Otter Tail Corporation ’s results of operations for the three and nine months ended September 30, 2017 and 2016 in the following financial statements: Consolidated Statements of Income, Consolidated Balance Sheets – Assets, Consolidated Balance Sheets – Liabilities and Equity, and Consolidated Statements of Cash Flows.

 

# # #

10
 

 

Otter Tail Corporation

Consolidated Statements of Income

In thousands, except share and per share amounts

(not audited)

 

   

Quarter Ended September 30,

   

Year-to-Date September 30,

 
   

201 7

   

201 6

   

201 7

   

201 6

 

Operating Revenues by Segment

                               

Electric

  $ 103,399     $ 102,723     $ 324,186     $ 313,642  

Manufacturing

    54,355       52,171       172,076       170,443  

Plastics

    58,708       42,292       146,416       122,841  

Intersegment Eliminations

    (5 )     (11 )     (18 )     (27 )

Total Operating Revenues

    216,457       197,175       642,660       606,899  

Operating Expenses

                               

Fuel and Purchased Power

    29,467       26,262       93,890       83,965  

Nonelectric Cost of Products Sold (depreciation included below)

    86,230       75,405       245,520       228,993  

Electric Operating and Maintenance Expense

    36,570       36,207       112,799       115,206  

Nonelectric Operating and Maintenance Expense

    10,933       10,197       31,535       30,890  

Depreciation and Amortization

    17,927       18,314       53,689       55,128  

Property Taxes - Electric

    3,721       3,506       11,228       10,774  

Total Operating Expenses

    184,848       169,891       548,661       524,956  

Operating Income (Loss) by Segment

                               

Electric

    20,484       23,340       66,952       63,374  

Manufacturing

    2,776       2,382       11,581       12,042  

Plastics

    10,049       4,187       21,640       13,939  

Corporate

    (1,700 )     (2,625 )     (6,174 )     (7,412 )

Total Operating Income

    31,609       27,284       93,999       81,943  

Interest Charges

    7,393       8,026       22,382       23,996  

Other Income

    592       499       1,697       2,431  

Income Tax Expense – Continuing Operations

    7,035       5,163       19,295       15,738  

Net Income (Loss) by Segment – Continuing Operations

                               

Electric

    10,869       12,513       36,563       34,199  

Manufacturing

    1,608       1,246       6,735       6,108  

Plastics

    6,092       2,346       13,166       7,983  

Corporate

    (796 )     (1,511 )     (2,445 )     (3,650 )

Net Income from Continuing Operations

    17,773       14,594       54,019       44,640  

(Loss) Income from Discontinued Operations - net of Income Tax (Benefit) Expense of ( $ 25), $ 14 , $ 53 and $1 14 for the respective periods

    (39 )     22       78       171  

Net Income

  $ 17,734     $ 14,616     $ 54,097     $ 44,811  

Average Number of Common Shares Outstanding

                               

Basic

    39,507,581       38,832,659       39,440,416       38,316,324  

Diluted

    39,795,366       39,005,706       39,712,862       38,457,401  
                                 

Basic Earnings Per Common Share:

                               

Continuing Operations

  $ 0.45     $ 0.38     $ 1.37     $ 1.17  

Discontinued Operations

    --       --       --       --  
    $ 0.45     $ 0.38     $ 1.37     $ 1.17  

Diluted Earnings Per Common Share:

                               

Continuing Operations

  $ 0.45     $ 0.37     $ 1.36     $ 1.16  

Discontinued Operations

    --       --       --       0.01  
    $ 0.45     $ 0.37     $ 1.36     $ 1.17  

 

11
 

 

 

Otter Tail Corporation

Consolidated Balance Sheets

 

Assets

in thousands

(not audited)

 

   

September 30 ,

   

December 31,

 
   

201 7

   

201 6

 
                 

Current Assets

               

Cash and Cash Equivalents

  $ 826     $ --  

Accounts Receivable:

               

Trade —Net

    87,510       68,242  

Other

    7,704       5,850  

Inventories

    78,915       83,740  

Unbilled Revenues

    14,948       20,080  

Income Taxes Receivable

    --       662  

Regulatory Assets

    21,582       21,297  

Other

    16,715       8,144  

Total Current Assets

    228,200       208,015  
                 

Investments

    8,599       8,417  

Other Assets

    34,992       34,104  

Goodwill

    37,572       37,572  

Other Intangibles —Net

    14,097       14,958  

Regulatory Assets

    122,670       132,094  
                 

Plant

               

Electric Plant in Service

    1,953,375       1,860,357  

Nonelectric Operations

    214,159       211,826  

Construction Work in Progress

    138,900       153,261  

Total Gross Plant

    2,306,434       2,225,444  

Less Accumulated Depreciation and Amortization

    785,667       748,219  

Net Plant

    1,520,767       1,477,225  

Total

  $ 1,966,897     $ 1,912,385  

 

 

12
 

 

Otter Tail Corporation

Consolidated Balance Sheets

Liabilities and Equity

 

in thousand s

(not audited)

 

   

September 30 ,

   

December 31,

 
   

201 7

   

201 6

 
                 

Current Liabilities

               

Short-Term Debt

  $ 103,637     $ 42,883  

Current Maturities of Long-Term Debt

    197       33,201  

Accounts Payable

    96,217       89,350  

Accrued Salaries and Wages

    17,596       17,497  

Accrued Taxes

    13,277       16,000  

Other Accrued Liabilities

    14,400       15,377  

Liabilities of Discontinued Operations

    852       1,363  

Total Current Liabilities

    246,176       215,671  
                 

Pensions Benefit Liability

    98,632       97,627  

Other Postretirement Benefits Liability

    63,215       62,571  

Other Noncurrent Liabilities

    22,921       21,706  
                 

Deferred Credits

               

Deferred Income Taxes

    242,568       226,591  

Deferred Tax Credits

    21,747       22,849  

Regulatory Liabilities

    84,281       82,433  

Other

    4,432       7,492  

Total Deferred Credits

    353,028       339,365  
                 

Capitalization

               

Long-Term Debt —Net

    490,406       505,341  
                 

Cumulative Preferred Shares

    --       --  
                 

Cumulative Preference Shares

    --       --  
                 

Common Equity

               

Common Shares, Par Value $5 Per Share

    197,787       196,741  

Premium on Common Shares

    342,573       337,684  

Retained Earnings

    155,618       139,479  

Accumulated Other Comprehensive Loss

    (3,459 )     (3,800 )

Total Common Equity

    692,519       670,104  

Total Capitalization

    1,182,925       1,175,445  

Total

  $ 1,966,897     $ 1,912,385  

 

 

13
 

 

Otter Tail Corporation

Consolidated Statements of Cash Flows

In thousands

(not audited)

 

   

For the Nine Months Ended September 30 ,

 
   

201 7

   

201 6

 

Cash Flows from Operating Activities

               

Net Income

  $ 54,097     $ 44,811  

Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:

               

Net Income from Discontinued Operations

    (78 )     (171 )

Depreciation and Amortization

    53,689       55,128  

Deferred Tax Credits

    (1,102 )     (1,242 )

Deferred Income Taxes

    15,680       14,924  

Change in Deferred Debits and Other Assets

    7,875       5,595  

Discretionary Contribution to Pension Plan

    --       (10,000 )

Change in Noncurrent Liabilities and Deferred Credits

    1,788       5,999  

Allowance for Equity/Other Funds Used During Construction

    (636 )     (605 )

Stock Compensation Expense – Equity Awards

    2,765       1,151  

Other —Net

    99       (73 )

Cash (Used for) Provided by Current Assets and Current Liabilities:

               

Change in Receivables

    (21,122 )     (3,490 )

Change in Inventories

    4,825       4,766  

Change in Other Current Assets

    3,079       1,690  

Change in Payables and Other Current Liabilities

    (5,153 )     (5,945 )

Change in Interest and Income Taxes Receivable/Payable

    (1,595 )     2,538  

Net Cash Provided by Continuing Operations

    114,211       115,076  

Net Cash Used in Discontinued Operations

    (134 )     (333 )

Net Cash Provided by Operating Activities

    114,077       114,743  

Cash Flows from Investing Activities

               

Capital Expenditures

    (94,549 )     (125,913 )

Net Proceeds from Disposal of Noncurrent Assets

    2,456       4,167  

Final Purchase Price Adjustment – BTD-Georgia Acquisition

    --       1,500  

Cash Used for Investments and Other Assets

    (3,158 )     (3,161 )

Net Cash Used in Investing Activities

    (95,251 )     (123,407 )

Cash Flows from Financing Activities

               

Changes in Checks Written in Excess of Cash

    4,826       (841 )

Net Short-Term Borrowings (Repayments)

    60,754       (43,499 )

Proceeds from Issuance of Common Stock – net of Issuance Expenses

    4,349       39,378  

Payments for Retirement of Capital Stock

    (1,799 )     (104 )

Proceeds from Issuance of Long-Term Debt

    --       50,000  

Short-Term and Long-Term Debt Issuance Expenses

    --       (157 )

Payments for Retirement of Long-Term Debt

    (48,172 )     (161 )

Dividends Paid

    (37,958 )     (35,952 )

Net Cash (Used in) Provided by Financing Activities

    (18,000 )     8,664  

Net Change in Cash and Cash Equivalents

    826       --  

Cash and Cash Equivalents at Beginning of Period

    --       --  

Cash and Cash Equivalents at End of Period

  $ 826     $ --  

 

14

Exhibit 99.2

 

News release

 

Contact: Cris Oehler

Office 218-739-8297

Home 218-842-5579

Cell 218- 531-0099

 

Otter Tail Power Company requests rate review in North Dakota

 

Current base rates established almost a decade ago

 

Fergus Falls, MN, November 1 , 2017 : Tomorrow Otter Tail Power Company will file a request with the North Dakota Public Service Commission (NDPSC) to increase its rates. The filing starts a nearly year-long process, often referred to as a rate case, during which the NDPSC first reviews the costs the company incurs to provide customers with energy and related services and then determines how much customers should pay for those services.

 

“While we ’ve been diligent in managing expenses and selecting low-cost options to meet customer needs, the cost of providing service is more than we’re able to recover through our current base rates, which went into effect almost a decade ago,” said Otter Tail Power Company President Tim Rogelstad.

 

S tronger , cleaner infrastructure, smarter technologies, and rising costs drive decision

“As the second smallest investor-owned utility in the country, our size gives us unique perspective into the small, rural communities we serve,” said Rogelstad. “With those communities and customers in mind, we’ve made smart, innovative business decisions to ensure the price they pay for reliable energy and top-notch customer service will continue to be among the lowest in the country.”

 

Part of the company ’s request was driven by its investments in required environmental technologies at its coal-fired Big Stone Plant and improved transmission infrastructure. “ The environmental technologies at Big Stone Plant will allow us to continue using this baseload resource well into the future,” said Rogelstad. “And our transmission projects are efficiently moving energy produced in this region and improving reliability of the energy grid.”

 

According to Rogelstad, the company also is in the process of developing and implementing a new Customer Information System. “The new system will allow us to provide customers more for their energy dollar,” said Rogelstad. The company expects to launch the system next year.

 

Otter Tail Power Company ’s current rates were established in 2009 based on 2007 costs. “The costs we incur to provide customers with energy and related services—like most costs—have increased. It’s time for the NDPSC to review them again,” said Rogelstad.

 

Typical residential customer ’s monthly bill would increase approximately $ 11.50

Ot ter Tail Power Company requested permission to increase non-fuel base rates by approximately $13.1 million, or 8.7 percent. If the NDPSC approves the overall request as filed, a typical residential customer’s bill would increase by approximately $11.50 a month and a typical business customer’s bill would increase by approximately $22 a month. The increase would be more for some customers and less for others, depending on the rates on which they’re served and the amount of energy they use.

 

 
 

 

 

While the NDPSC considers Otter Tail Power Company’s overall request, the company has asked to increase rates on an interim basis by approximately $12.8 million. The interim request would be billed uniformly to customers and applies only to base rates. Cost-recovery riders would continue at adjusted rates until the implementation of final rates. If approved, the interim increase would be effective January 1, 2018. It would remain in effect until the NDPSC makes a final determination on the company’s overall request, which Otter Tail Power Company expects would be in 2018. If final rates are lower than interim rates, the company will refund customers the difference with interest. If final rates are higher than interim rates, the company won’t collect the difference.

 

“We ’ve made it almost a decade without raising North Dakota customers’ base rates—and we’re proud of that,” said Rogelstad.

 

Customer notification

Customers will receive printed information with their electric service statements starting in November showing the requested overall rate increase and example monthly bill impacts for various customer types.

 

The NDPSC will hold public meetings related to the request and will post the meeting schedule on its website after that schedule is determined. Otter Tail Power Company also will post the meeting schedule on its website.

 

Otter Tail Power Company, a subsidiary of Otter Tail Corporation (NASDAQ Global Select Market: OTTR), is headquartered in Fergus Falls, Minnesota. With a balanced commitment to environmental, economic, and community stewardship, the company provides electricity and energy services to more than a quarter million people in Minnesota, North Dakota, and South Dakota. To learn more about Otter Tail Power Company visit otpco.com . To learn more about Otter Tail Corporation visit ottertail.com .

 

 

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