Otter Tail Corporation announced that it expects to receive $230 million in funding from a group of investors
June 09, 2021
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Otter Tail Corporation (NasdaqGS:OTTR) announced that it has entered into a note purchase agreement for a private placement of senior unsecured notes consisting of 2.74% series 2021A senior unsecured notes due November 29, 2031 for gross proceeds of $40,000,000, 3.69% series 2021B senior unsecured notes due November 29, 2051 for gross proceeds of $100,000,000, and 3.77% series 2022A senior unsecured notes due May 20, 2052 for gross proceeds of $90,000,000 for aggregate gross proceeds of $230,000,000 on June 10, 2021. The transaction will include participation from Gibraltar Universal Life Reinsurance Company, Pruco Life Insurance Company, Prudential Term Reinsurance Company, Prudential Arizona Reinsurance Universal Company, The Prudential Insurance Company of America, Inc., PICA Hartford Life Insurance Comfort Trust, PICA Hartford Life & Annuity Comfort Trust, Lincoln Life & Annuity Company of New York, The Lincoln National Life Insurance Company, Great-West Life & Annuity Insurance Company, Great-West Life & Annuity Insurance Company of New York, Thrivent Financial for Lutherans, Inc., State Farm Life Insurance Company, Inc., State Farm Life and Accident Assurance Company, State Farm Insurance Companies, Employee Retirement Trust, Genworth Life and Annuity Insurance Company, The Northwestern Mutual Life Insurance Company, Transamerica Life Insurance Company, Transamerica Life (Bermuda) Ltd., Nassau Life and Annuity Company, Protective Life Insurance Company, THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY FOR ITS GROUP ANNUITY SEPERATE ACCOUNT, The Ohio National Life Insurance Company, Travelers Casualty and Surety Company, Inc., Mutual of Omaha Insurance Company, United of Omaha Life Insurance Company, American Family Life Insurance Company, Southern Farm Bureau Life Insurance Company, Life Insurance Company of the Southwest, Inc., COUNTRY Mutual Insurance Company, USAA PENSION TRUST, PAR U HARTFORD LIFE INSURANCE COMFORT TRUST, returning investors Teachers Insurance and Annuity Association of America, John Hancock Life Insurance Company (U.S.A.) and John Hancock Life & Health Insurance Company. The series 2021A notes and the series 2021B notes are expected to be issued on November 29, 2021. The series 2022A notes are expected to be issued on May 20, 2022. The issuance of the notes is subject to the satisfaction of certain customary conditions to closing. The agreement allows the company to prepay all or any part of the notes at 100% of the principal amount so prepaid, together with unpaid accrued interest and a make-whole amount; provided that if no default or event of default exists under the agreement, any prepayment made by the company of all of the series 2021A notes then outstanding on or after May 29, 2031, series 2021B notes then outstanding on or after May 29, 2051 or series 2022A notes then outstanding on or after November 20, 2051 will be made without any make-whole amount. The agreement also requires the company to offer to prepay all outstanding notes at 100% of the principal amount together with unpaid accrued interest in the event of a change of control of the company. The company shall pay all costs and expenses including reasonable fees, charges and disbursements of the investor's special counsel in the transaction. The company will not purchase, redeem, prepay or otherwise acquire or assume, directly or indirectly, any of the outstanding notes except upon the payment or prepayment of the notes in accordance with the terms of the agreement and pursuant to an offer to purchase made by the company or an affiliate pro rata to each holder upon the same terms and conditions. The sale and purchase of the series 2021A notes and the series 2021B notes shall occur on November 29, 2021. The sale and purchase of the series 2022A notes shall occur on May 20, 2022.
Otter Tail Corporation is a holding company. The Company operates through three segments: Electric, Manufacturing and Plastics. The Electric segment includes the generation, purchase, transmission, distribution and sale of electric energy in western Minnesota, eastern North Dakota and northeastern South Dakota. The Manufacturing segment consists of businesses engaged in manufacturing activities: contract machining; metal parts stamping; fabrication and painting; and production of plastic thermoformed horticultural containers, life science and industrial packaging, material handling components and extruded raw material stock. These businesses have manufacturing facilities in Georgia, Illinois and Minnesota and sell products primarily in the United States. The Plastics segment consists of businesses producing polyvinyl chloride (PVC) pipe at plants in North Dakota and Arizona. The PVC pipe is sold primarily in the western half of the United States and Canada.