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): August 20, 2007
OTTER TAIL CORPORATION
(Exact name of registrant as specified in its charter)
| |
|
|
|
|
| Minnesota
|
|
0-00368
|
|
41-0462685 |
| (State or other jurisdiction of incorporation)
|
|
(Commission File Number)
|
|
(I.R.S. Employer 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:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
|
|
|
| Item 1.01 |
|
Entry into a Material Definitive Agreement |
On August 20, 2007, Otter Tail Corporation (the “Company”) entered into a note purchase
agreement (the “Note Purchase Agreement”) with each of Deutsche Bank AG New York Branch, Teachers
Insurance and Annuity Association of America, Provident Life and Accident Insurance Company, The
Guardian Life Insurance Company of America, Thrivent Financial For Lutherans, Fort Dearborn Life
Insurance Company, The Catholic Aid Association, Great West Insurance Company, American Republic
Insurance Company, Cincinnati Insurance Company, Colorado Bankers Life Insurance Company, Navy
Mutual Aid Association and National Guardian Life Insurance Company (collectively, the
“Purchasers”). The Note Purchase Agreement relates to the issuance and sale by the Company to the
Purchasers, in a private placement transaction, of $155 million aggregate principal amount of the
Company’s Senior Unsecured Notes (collectively, the “Notes”), to be issued in four series, in the
following designations and aggregate principal amounts: (i) $33,000,000 aggregate principal amount
of 5.95% Senior Unsecured Notes, Series A, due 2017 (the “Series A Notes”), (ii) $30,000,000
aggregate principal amount of 6.15% Senior Unsecured Notes, Series B, due 2022 (the “Series B
Notes”), (iii) $42,000,000 aggregate principal amount of 6.37% Senior Unsecured Notes, Series C,
due 2027 (the “Series C Notes”) and (iv) $50,000,000 aggregate principal amount of 6.47% Senior
Unsecured Notes, Series D, due 2037 (the “Series D Notes”).
On August 20, 2007, $12,000,000 aggregate principal amount of the Series C Notes and
$13,000,000 aggregate principal amount of the Series D Notes were issued and sold pursuant to the
Note Purchase Agreement. The remaining $30,000,000 aggregate principal amount of the Series C
Notes and $37,000,000 aggregate principal amount of the Series D Notes, as well as the Series A
Notes and the Series B Notes, will be issued and sold by the Company at a second closing (the
“Second Closing”) that is expected to occur on October 1, 2007, subject to the satisfaction of
certain customary conditions to closing.
The Note Purchase Agreement provides that the Company must offer to prepay all of the
outstanding Notes in full together with unpaid accrued interest to the date of prepayment (i) in
the event of a “Change of Control” of the Company (as defined in the Note Purchase Agreement), and
(ii) if the Second Closing is not consummated by October 5, 2007. The Note Purchase Agreement also
provides that the Company may, at its option and upon notice as described in the Note Purchase
Agreement, prepay all or any part of the Notes (in an amount not less than 10% of the aggregate
principal amount of the Notes then outstanding in the case of a partial prepayment) at 100% of the
principal amount prepaid plus the “Make-Whole Amount” (as defined in the Note Purchase Agreement).
The Note Purchase Agreement contains the following financial covenants: (i) a covenant not to
permit “Consolidated Debt” to exceed 60% of “Consolidated Total Capitalization,” determined as of
the end of each fiscal quarter of the Company, (ii) a covenant not to permit the “Interest and
Dividend Coverage Ratio” for any fiscal quarter to be less than 1.5 to 1.0, and (iii) a covenant
not to permit “Priority Debt” to exceed 20% of “Consolidated Total Capitalization,” determined as
of the end of each fiscal quarter of the Company (as such terms are defined in the Note Purchase
Agreement). These financial covenants are the same as those contained in the
2
Company’s lines of
credit and in the note purchase agreement entered into in connection with the issuance of the
Company’s $90 million 6.63% senior notes due December 1, 2011.
This summary of the Note Purchase Agreement is qualified in its entirety by reference to the
full text of the Note Purchase Agreement, a copy of which is filed as Exhibit 4.1 hereto and
incorporated herein by reference.
|
|
|
| Item 2.03 |
|
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant |
As described under Item 1.01 of this Form 8-K, on August 20, 2007 the Company entered into the
Note Purchase Agreement.
|
|
|
| Item 9.01 |
|
Financial Statements and Exhibits |
(d) Exhibits
| |
4.1 |
|
Note Purchase Agreement, dated as of August 20, 2007, between Otter Tail Corporation
and each of Deutsche Bank AG New York Branch, Teachers Insurance and Annuity Association of
America, Provident Life and Accident Insurance Company, The Guardian Life Insurance Company
of America, Thrivent Financial For Lutherans, Fort Dearborn Life Insurance Company, The
Catholic Aid Association, Great West Insurance Company, American Republic Insurance
Company, Cincinnati Insurance Company, Colorado Bankers Life Insurance Company, Navy Mutual
Aid Association and National Guardian Life Insurance Company |
3