Otter Tail Corp

Previous wording

Broader macroeconomic conditions resulting from newly imposed or increased tariffs could include rising inflation and a heightened risk of an economic recession, which could have a more extensive impact on our business. Such impacts may include increased operating and investment costs, reduced customer demand for our products, including from the impact of customer insourcing, reduced electric demand, and elevated interest rates, all of which could negatively impact our operating results and financial position.

Current wording

Broader macroeconomic conditions resulting from newly imposed or increased tariffs could include rising inflation and a heightened risk of an economic recession, which could have a more extensive impact on our business. Such impacts may include increased operating and investment costs, reduced demand for electric service, elevated interest rates, and reduced customer demand for our products, which may be impacted by residential and commercial construction levels and the result of customer in-sourcing affecting our metal fabrication business. All of these factors could negatively impact our operating results and financial position.

Previous wording

Currently, we cannot predict the ultimate impact on our business as it is dependent on the extent and duration of changes in U.S. tariff policy and any countermeasures adopted by foreign countries.

Current wording

Currently, we cannot predict the ultimate impact on our business as it is dependent on the extent and duration of changes in U.S. tariff policy and any countermeasures implemented by foreign countries.

Previous wording

Operating Revenues decreased $9.7 million primarily due to decreased sales volumes in our Manufacturing segment, partially offset by increased revenue in our Electric segment driven by increased fuel recovery revenue and the impact of favorable weather compared to the same period last year. See our segment disclosures below for additional discussion of items impacting operating revenues.

Current wording

Operating Revenues decreased $9.3 million primarily due to decreased sales volumes in our Manufacturing segment and decreased sales prices in our Plastics segment, partially offset by increased sales volumes in our Plastics segment as well as increased fuel recovery revenue in our Electric segment compared to the same period last year. See our segment disclosures below for additional discussion of items impacting operating revenues.

Previous wording

Operating Expenses increased $1.3 million due to increased purchased power costs and depreciation expense in our Electric segment, the impact of increased sales volumes in our Plastics segment and higher general and administrative expenses. These increases were largely offset by lower cost of goods sold from decreased sales volumes in our Manufacturing segment. See our segment disclosures below for additional discussion of items impacting operating expenses.

Current wording

Operating Expenses increased $4.2 million due to increased purchased power and fuel costs, operating and maintenance expenses, and depreciation expense in our Electric segment, and the impact of increased sales volumes in our Plastics segment. These increases were partially offset by lower cost of goods sold from decreased sales volumes in our Manufacturing segment and the impact of lower PVC resin costs in our Plastics segment. See our segment disclosures below for additional discussion of items impacting operating expenses.

Previous wording

Interest Expense increased $1.7 million primarily due to the issuance of $120.0 million of long-term debt at OTP in March 2024, the proceeds of which were used to repay short-term borrowings, fund capital expenditures and support operating activities.

Current wording

Interest Expense increased $1.5 million primarily due to the issuance of $100.0 million of long-term debt at OTP during the year, the proceeds of which were used to repay short-term borrowings, fund capital expenditures and support operating activities.

Previous wording

Nonservice Components of Postretirement Benefits decreased by $1.2 million, having a negative impact on net income, primarily due to a decrease in the amortization of plan amendment-related gains and an increase in the amortization of actuarial losses.

Current wording

Nonservice Components of Postretirement Benefits decreased by $1.5 million, having a negative impact on net income, primarily due to a decrease in the amortization of plan amendment-related gains and an increase in the amortization of actuarial losses.

Previous wording

Income Tax Expense decreased $7.7 million primarily due to an increase in PTCs at OTP driven by increased wind generation and a decrease in income before taxes. In late 2024, we completed our first wind repowering project which resulted in the commencement of PTCs associated with the generation from the facility. Our effective tax rate was 12.9% for the three months ended March 31, 2025 and 19.3% for the same period last year.

Current wording

Income Tax Expense decreased $6.9 million primarily due to a decrease in income before income taxes, as well as an increase in PTCs at OTP driven by increased wind and solar generation which qualified for credits. Our effective tax rate was 14.9% for the three months ended June 30, 2025 and 19.2% for the same period last year. The decrease in our effective tax rate was primarily driven by an increase in PTCs from our wind and solar generation assets. In late 2024, we completed our first wind repowering project which resulted in the commencement of PTCs associated with the generation from the facility.

Previous wording

The operating results of our Electric segment are impacted by fluctuations in weather conditions and the resulting demand for electricity for heating and cooling. The following table shows heating degree days as a percent of normal for the three months ended March 31, 2025 and 2024. There were no cooling degree days in our service territory during the three months ended March 31, 2025 and 2024.

Current wording

The operating results of our Electric segment are impacted by fluctuations in weather conditions and the resulting demand for electricity for heating and cooling. The following table shows heating degree days and cooling degree days as a percent of normal for the three months ended June 30, 2025 and 2024.

Previous wording

Retail Revenues increased $8.9 million primarily due to the following:

Current wording

Retail Revenues increased $13.7 million primarily due to the following:

Previous wording

•A $6.1 million increase in fuel recovery revenues due to an increase in the volume and price of market energy purchases, as described below.

Current wording

•A $8.7 million increase in fuel recovery revenues due to an increase in the price of market energy purchases and natural gas, as described below.

Previous wording

•A $3.7 million increase from the impact of favorable weather, as the first quarter of 2024 was unseasonably warm in our service territory.

Current wording

•A $1.6 million increase from the impact of favorable weather, as the second quarter of 2024 was quite mild in our service territory.

Previous wording

Depreciation and Amortization expense increased $2.5 million due to additional assets, including certain wind, transmission and distribution assets, being placed in service.

Current wording

Depreciation and Amortization expense increased $1.9 million due to additional assets, including certain wind, transmission and distribution assets, being placed in service.

Previous wording

Operating Revenues decreased $17.7 million primarily due to a 13% decrease in sales volumes, with the most significant declines experienced in the recreational vehicle, agriculture, and construction end markets. Sales volumes have continued to soften due to lower end market demand and inventory management efforts by manufacturers and dealers. A 3% decrease in steel costs, which are passed through to customers, as well as a 1% decrease in scrap revenue also contributed to the decrease in operating revenues.

Current wording

Operating Revenues decreased $18.0 million primarily due to a 9% decrease in sales volumes, with declines experienced primarily in the agriculture, recreational vehicles, lawn and garden, and construction end markets. Sales volumes were down at our metal fabrication business due to soft end market demand and inventory management efforts by manufacturers and dealers. A 7% decrease in steel costs, which are passed through to customers, also contributed to the decrease in operating revenues.

Previous wording

Operating Revenues decreased $0.3 million due to an 11% decrease in sales prices compared to the same period last year, continuing the steady decline in product pricing due to continuing changes from peak market conditions in late 2022. The impact of decreased sales prices was largely offset by a 13% increase in sales volumes driven by strong distributor and end market demand coupled with increased production capacity after the completion of our expansion project at Vinyltech in late 2024. Active infrastructure investment and construction across our sales territories have continued to contribute to strong distributor and end market demand.

Current wording

Operating Revenues decreased $7.2 million primarily due to a 15% decrease in sales prices compared to the same period last year, continuing the steady decline in product pricing from peak market conditions in late 2022. The impact of decreased sales prices was partially offset by an 11% increase in sales volumes, driven by strong distributor and end-market demand for our products, coupled with increased production capacity following the completion of our expansion project at Vinyltech in late 2024. Active infrastructure investment and construction activity across our sales territories continue to contribute to strong demand for our products.

Previous wording

Interest Expense increased $1.7 million primarily due to the issuance of $120.0 million of long-term debt in March 2024, the proceeds of which were used to repay short-term borrowings, fund capital expenditures and support operating activities.

Current wording

Interest Expense increased $3.2 million primarily due to the issuance of $100.0 million of long-term debt at OTP during the year, the proceeds of which were used to repay short-term borrowings, fund capital expenditures and support operating activities.

Previous wording

The increases in retail revenues described above were partially offset by a net decrease in rider revenues. Rider revenues decreased on a net basis as a result of increased PTCs from our wind generation, which are passed on to customers, partially offset by recovery of our investments in our wind repowering projects.

Current wording

The increases in retail revenues described above were partially offset by a net decrease in renewable rider revenue, driven by increased PTCs from our wind and solar generation, which are passed on to customers.

Previous wording

Income Tax Benefit (Expense)was a benefit of $4.0 million for the three months ended March 31, 2025, compared to an expense of $1.2 million for the same period last year. The current period benefit was primarily due to an increase in PTCs driven by increased wind generation that qualified for PTCs compared to last year. PTCs are generally credited to customers and result in a reduction of revenue as well as income taxes.

Current wording

Income Tax Benefit increased $8.3 million primarily due to an increase in PTCs, driven by increased wind and solar generation that qualified for PTCs compared to last year. PTCs are generally credited to customers and result in a reduction of revenue as well as income taxes.

Previous wording

Cost of Products Sold increased $2.3 million primarily due to increased sales volumes, as described above. The cost of PVC resin and other input materials decreased 9% compared to the prior year, driven by elevated domestic resin supply, partially offsetting the impact of increased sales volumes.

Current wording

Cost of Products Sold increased $4.2 million primarily due to increased sales volumes, as described above. The cost of PVC resin decreased 11% compared to the prior year, driven by global supply and demand dynamics which continues to result in elevated supply, partially offsetting the impact of increased sales volumes.

Previous wording

Selling, General, and Administrative Expenses increased $1.4 million primarily due to costs associated with ongoing litigation regarding the pricing of PVC pipe, which is further described in Note 9 to the consolidated financial statements.

Current wording

Selling, General, and Administrative Expenses increased $1.9 million primarily due to costs associated with ongoing litigation regarding the pricing of PVC pipe, which is further described in Note 9 to the consolidated financial statements.

Previous wording

General and Administrative Expenses increased $1.6 million primarily due to increased employee health insurance claim costs, after experiencing a decline in employee medical costs in the first quarter of 2024.

Current wording

General and Administrative Expenses increased $1.4 million primarily due to increased employee health insurance claim costs, after experiencing a decline in employee medical costs in the first half of 2024.

Previous wording

On December 30, 2024, the North Dakota Public Service Commission approved a settlement agreement between OTP and certain interested parties in their general rate case and issued its written order on final rates. The key provisions of the order include a revenue requirement of $225.6 million, based on a return on rate base of 7.53%, and an allowed ROE of 10.10% on an equity ratio of 53.5%. The net annual revenue requirement includes a net increase of $13.1 million or 6.18%. OTP’s revenue requirement was reduced by approximately $3.0 million primarily due to the inclusion of forecasted PTCs plus adjustments for new customer load additions, which were not included in OTP’s updated request filed on July 3, 2024. Through the settlement of the case, the parties also agreed to establish an earnings-sharing mechanism, whereby 70% of actual earnings in excess of a 10.20% ROE would be returned to customers, with OTP retaining the remaining 30%. New base rates in North Dakota went into effect on March 15, 2025.

Current wording

On December 30, 2024, the North Dakota Public Service Commission approved a settlement agreement between OTP and certain interested parties in their general rate case and issued its written order on final rates. The key provisions of the order include a revenue requirement of $225.6 million, based on a return on rate base of 7.53%, and an allowed ROE of 10.10% on an equity ratio of 53.50%. The net annual revenue requirement includes a net increase of $13.1 million or 6.18%. OTP’s revenue requirement was reduced by approximately $3.0 million primarily due to the inclusion of forecasted PTCs plus adjustments for new customer load additions, which were not included in OTP’s updated request filed on July 3, 2024. Through the settlement of the case, the parties also agreed to establish an earnings-sharing mechanism, whereby 70% of actual earnings in excess of a 10.20% ROE would be returned to customers, with OTP retaining the remaining 30%. New base rates in North Dakota went into effect on March 15, 2025.

Previous wording

OTC and OTP are each party to separate credit agreements (the OTC Credit Agreement and OTP Credit Agreement, respectively) which provide for unsecured revolving lines of credit. Should additional liquidity be needed, the OTC Credit Agreement includes an accordion feature allowing us to increase the amount available to $290 million, subject to certain terms and conditions. The OTP Credit Agreement also includes an accordion feature allowing OTP to increase that facility to $300 million, subject to certain terms and conditions.

Current wording

OTC and OTP are each party to separate credit agreements (the OTC Credit Agreement and OTP Credit Agreement, respectively) which provide for unsecured revolving lines of credit. Should additional liquidity be needed, the OTC Credit Agreement includes an accordion feature allowing us to increase the amount available to $290.0 million, subject to certain terms and conditions. The OTP Credit Agreement also includes an accordion feature allowing OTP to increase that facility to $300.0 million, subject to certain terms and conditions.

Previous wording

As of March 31, 2025, we had $322.4 million of available liquidity under our credit facilities and $284.8 million of available cash and cash equivalents, resulting in total available liquidity of $607.2 million.

Current wording

As of June 30, 2025, we had $381.0 million of available liquidity under our credit facilities and $307.2 million of available cash and cash equivalents, resulting in total available liquidity of $688.2 million.

Previous wording

The following is a discussion of our cash flows for the three months ended March 31, 2025 and 2024:

Current wording

The following is a discussion of our cash flows for the six months ended June 30, 2025 and 2024:

Previous wording

Net Cash Provided by Operating Activities decreased $32.4 million for the three months ended March 31, 2025 compared to the three months ended March 31, 2024, primarily due to the timing of fuel cost and rider recoveries from our utility customers, the timing of payments of operating costs in our Electric segment and a decrease in earnings. Net cash provided by operating activities in our Electric segment is regularly affected by the timing of payments made for operating costs and the various mechanisms used to recover costs from, or return amounts to, our utility customers. The timing of recoveries and refunds can vary by the recovery or refund mechanism. Due to the numerous factors that impact the timing of our cash receipts and cash payments, our cash provided by operating activities can vary significantly from our net income for the period.

Current wording

Net Cash Provided by Operating Activities decreased $64.1 million for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily due to the timing of fuel cost and rider recoveries from our utility customers, the timing of payments of operating costs and a decrease in earnings. Net cash provided by operating activities in our Electric segment is regularly affected by the timing of payments made for operating costs and the various mechanisms used to recover costs from or return amounts to our utility customers. The timing of recoveries and refunds can vary by the recovery or refund mechanism. Due to the numerous factors that impact the timing of our cash receipts and cash payments, our cash provided by operating activities can vary significantly from our net income for the period.

Previous wording

Net Cash Used in Investing Activities decreased $15.0 million for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The decrease in cash used in investing activities was primarily due to a decrease in our capital expenditures in our Manufacturing and Plastics segments, as we completed our expansion projects in Arizona and Georgia in late 2024. Capital expenditures during the three months ended March 31, 2025 included additional investments in our wind repowering, advanced meter infrastructure and transmission line projects in our Electric segment.

Current wording

Net Cash Used in Investing Activities decreased $101.0 million for the six months ended June 30, 2025 compared to the six months ended June 30, 2024. The decrease in cash used in investing activities included a $51.3 million decrease in capital expenditures. Capital expenditures in our Electric segment decreased $31.2 million primarily due to the timing of investments under our five-year capital spending plan. Our expansion projects at Vinyltech and BTD Manufacturing were completed in late 2024, which also contributed to the decrease in our capital expenditures compared to last year. Investing activities during the six months ended June 30, 2024, also included a $50.1 million investment in U.S. treasuries made to secure a fixed rate of return until their maturity in September 2026.

Previous wording

Net Cash Provided by Financing Activities decreased $0.1 million for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. Financing activities for the three months ended March 31, 2025 included the issuance of $50.0 million of long-term debt at OTP, the proceeds of which were used to repay short-term borrowings under the OTP credit agreement, fund Electric segment construction expenditures and support operating activities. We manage the capital structure of OTP independent from our consolidated financial position to ensure compliance with the capital structure approved through regulation; therefore, our decision to issue long-term debt at OTP is not impacted by our consolidated cash and cash equivalent position.

Current wording

Net Cash (Used in) Provided by Financing Activities for the six months ended June 30, 2025 included the issuance of $100.0 million of long-term debt at OTP, the proceeds of which were used to repay short-term borrowings under the OTP credit agreement, fund Electric segment construction expenditures and support operating activities. We manage the capital structure of OTP independent from our consolidated financial position to ensure compliance with the capital structure approved through regulation; therefore, our decision to issue long-term debt at OTP is not impacted by our consolidated cash and cash equivalent position.

Previous wording

Financing activities for the three months ended March 31, 2025 also included net repayments of short-term borrowings of $10.8 million and dividend payments of $22.0 million. Financing activities for the three months ended March 31, 2024 included the issuance of $120.0 million of long-term debt at OTP, net repayments of short-term debt of $81.4 million and dividend payments of $19.6 million.

Current wording

Financing activities for the six months ended June 30, 2025 also included net repayments of short-term borrowings of $69.6 million and dividend payments of $44.0 million. Financing activities for the six months ended June 30, 2024 included the issuance of $120.0 million of long-term debt at OTP, net repayments of short-term debt of $68.6 million and dividend payments of $39.1 million.

Previous wording

Our capital expenditure plan includes investments in electric generation facilities, transmission and distribution lines and facilities, equipment used in the manufacturing process, and computer hardware and information systems. Our capital expenditure plan is subject to review and is revised in light of changes in demands for energy, technology, environmental laws, regulatory approvals, business expansion opportunities, the costs of labor, materials and equipment and our financial condition. Refer to Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, of our Form 10-K for the year ended December 31, 2024 for our capital expenditure plans for the five year period from 2025 through 2029.

Current wording

Our capital expenditure plan includes investments in electric generation facilities, transmission and distribution lines and facilities, equipment used in the manufacturing process, and computer hardware and information systems. Our capital expenditure plan is subject to review and is revised in light of changes in demands for energy, technology, environmental laws, changes in legislation or regulation, regulatory approvals, business expansion opportunities, the costs of labor, materials and equipment, and our financial condition. Refer to Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, of our Form 10-K for the year ended December 31, 2024 for our capital expenditure plans for the five year period from 2025 through 2029.

Previous wording

Our contractual obligations as of December 31, 2024 are included in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, of our Annual Report on Form 10-K for the year ended December 31, 2024. There were no material changes in our contractual obligations outside of the ordinary course of business during the three months ended March 31, 2025.

Current wording

Our contractual obligations as of December 31, 2024 are included in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, of our Annual Report on Form 10-K for the year ended December 31, 2024. There were no material changes in our contractual obligations outside of the ordinary course of business during the six months ended June 30, 2025.

Previous wording

We paid dividends to our shareholders totaling $22.0 million, or $0.5250 per share, in the first quarter of 2025. The determination of the amount of future cash dividends to be paid will depend on, among other things, our financial condition, our actual or expected level of earnings and cash flows from operations, the level of our capital expenditures and our future business prospects. As a result of certain statutory limitations or regulatory or financing agreements, the amount of dividends we are allowed to pay could be restricted. See Note 10 to our consolidated financial statements included in this Quarterly Report on Form 10-Q for additional information. The decision to declare dividends is reviewed quarterly by our Board of Directors.

Current wording

We paid dividends to our shareholders totaling $44.0 million, or $1.05 per share, in the first six months of 2025. The determination of the amount of future cash dividends to be paid will depend on, among other things, our financial condition, our actual or expected level of earnings and cash flows from operations, the level of our capital expenditures and our future business prospects. As a result of certain statutory limitations or regulatory or financing agreements, the amount of dividends we are allowed to pay could be restricted. See Note 10 to our consolidated financial statements included in this Quarterly Report on Form 10-Q for additional information. The decision to declare dividends is reviewed quarterly by our Board of Directors.

Previous wording

On May 3, 2024, we filed two registration statements with the SEC, replacing two previously filed registration statements upon their expiration. The first statement, a shelf registration, allows us to offer for sale from time to time, either separately or together in any combination, equity, debt or other securities described in the registration statement. No new debt or equity has been issued pursuant to the registration statement. The second registration statement allows for the issuance of up to 1,500,000 common shares under our Automatic Dividend Reinvestment and Share Purchase Plan, which provides our common shareholders, retail customers of OTP and other interested investors a method of purchasing our common shares by reinvesting their dividends and/or making optional cash investments. Shares purchased under the plan may be newly issued common shares or common shares purchased on the open market. As of March 31, 2025, there were 1,404,582 shares available for purchase or issuance under the plan. Both registration statements expire in May 2027.

Current wording

On May 3, 2024, we filed two registration statements with the SEC, replacing two previously filed registration statements upon their expiration. The first statement, a shelf registration, allows us to offer for sale from time to time, either separately or together in any combination, equity, debt or other securities described in the registration statement. No new debt or equity has been issued pursuant to the registration statement. The second registration statement allows for the issuance of up to 1,500,000 common shares under our Automatic Dividend Reinvestment and Share Purchase Plan, which provides our common shareholders, retail customers of OTP and other interested investors a method of purchasing our common shares by reinvesting their dividends and/or making optional cash investments. Shares purchased under the plan may be newly issued common shares or common shares purchased on the open market. As of June 30, 2025, there were 1,379,019 shares available for purchase or issuance under the plan. Both registration statements expire in May 2027.

Previous wording

OTC and OTP are each party to a credit agreement (the OTC Credit Agreement and the OTP Credit Agreement, respectively) which each provides for unsecured revolving lines of credit. The following is a summary of key provisions and borrowing information as of and for the three months ended, March 31, 2025:

Current wording

OTC and OTP are each party to a credit agreement (the OTC Credit Agreement and the OTP Credit Agreement, respectively) which each provides for unsecured revolving lines of credit. The following is a summary of key provisions and borrowing information as of and for the six months ended, June 30, 2025:

Previous wording

On March 27, 2025, OTP entered into a Note Purchase Agreement pursuant to which OTP issued, in a private placement transaction, $100.0 million of senior unsecured notes consisting of (a) $50.0 million of 5.49% Series 2025A Senior Unsecured Notes due March 27, 2035, and (b) $50.0 million of 5.98% Series 2025B Senior Unsecured Notes due June 5, 2055. The Series 2025A Notes were issued on March 27, 2025, upon entering into the agreement. The Series 2025B Notes are expected to be issued on June 5, 2025, subject to the satisfaction of certain customary conditions to closing. We do not anticipate or plan to issue any additional long-term debt in 2025.

Current wording

On March 27, 2025, OTP entered into a Note Purchase Agreement pursuant to which OTP issued, in a private placement transaction, $100.0 million of senior unsecured notes consisting of (a) $50.0 million of 5.49% Series 2025A Senior Unsecured Notes due March 27, 2035, and (b) $50.0 million of 5.98% Series 2025B Senior Unsecured Notes due June 5, 2055. The Series 2025A Notes were issued on March 27, 2025, upon entering into the agreement. The Series 2025B Notes were issued on June 5, 2025. We do not anticipate or plan to issue any additional long-term debt in 2025.

Previous wording

As of March 31, 2025, we had $997.0 million of principal outstanding under long-term debt arrangements. These instruments generally provide for unsecured borrowings at fixed rates of interest with maturities ranging from 2026 to 2054. Note 6 to our consolidated financial statements included in this Quarterly Report on Form 10-Q includes additional information regarding these long-term debt instruments.

Current wording

As of June 30, 2025, we had $1.0 billion of principal outstanding under long-term debt arrangements. These instruments generally provide for unsecured borrowings at fixed rates of interest with maturities ranging from 2026 to 2055. Note 6 to our consolidated financial statements included in this Quarterly Report on Form 10-Q includes additional information regarding these long-term debt instruments.

Previous wording

OTC, under its financial covenants, may not permit its ratio of interest-bearing debt to total capitalization to exceed 0.60 to 1.00 or 0.65 to 1.00, depending on the debt agreement, may not permit its interest and dividend coverage ratio to be less than 1.50 to 1.00 and may not permit its priority indebtedness to exceed 10 percent of its total capitalization. As of March 31, 2025, OTC's interest-bearing debt to total capitalization was 0.38 to 1.00, OTC's interest and dividend coverage ratio was 9.33 to 1.00 and OTC had no priority indebtedness outstanding.

Current wording

OTC, under its financial covenants, may not permit its ratio of interest-bearing debt to total capitalization to exceed 0.60 to 1.00 or 0.65 to 1.00, depending on the debt agreement, may not permit its interest and dividend coverage ratio to be less than 1.50 to 1.00 and may not permit its priority indebtedness to exceed 10 percent of its total capitalization. As of June 30, 2025, OTC's interest-bearing debt to total capitalization was 0.37 to 1.00, OTC's interest and dividend coverage ratio was 8.7 to 1.00 and OTC had no priority indebtedness outstanding.

Previous wording

OTP, under its financial covenants, may not permit its ratio of interest-bearing debt to total capitalization to exceed 0.60 to 1.00 or 0.65 to 1.00, depending on the debt agreement, may not permit its interest and dividend coverage ratio to be less than 1.50 to 1.00 and may not permit its priority indebtedness to exceed 20 percent of its total capitalization. As of March 31, 2025, OTP's interest-bearing debt to total capitalization was 0.48 to 1.00, OTP's interest and dividend coverage ratio was 3.17 to 1.00 and OTP had no priority indebtedness outstanding.

Current wording

OTP, under its financial covenants, may not permit its ratio of interest-bearing debt to total capitalization to exceed 0.60 to 1.00 or 0.65 to 1.00, depending on the debt agreement, may not permit its interest and dividend coverage ratio to be less than 1.50 to 1.00 and may not permit its priority indebtedness to exceed 20 percent of its total capitalization. As of June 30, 2025, OTP's interest-bearing debt to total capitalization was 0.45 to 1.00, OTP's interest and dividend coverage ratio was 3.03 to 1.00 and OTP had no priority indebtedness outstanding.