##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-K

|           |  |     |  |                                                         
|---------- |  | --- |  | --------------------------------------------------------
|(Mark One) |  | (X) |  | Annual Report pursuant to Section 13 or 15(d) of the    
|           |  |     |  | Securities Exchange Act of 1934                         
|          
|           |  |     |  | For the fiscal year ended December 31, 2003             
|           |  |     |  | OR                                                      
|           |  | ( ) |  | Transition Report pursuant to Section 13 or 15(d) of the
|           |  |     |  | Securities Exchange Act of 1934                         
|          
|           |  |     |  | For the transition
period from________to__________      

Commission File Number 0-368

OTTER TAIL CORPORATION

(Exact name of registrant as specified in its charter)


|                                                                                                   |  |                                                
|-------------------------------------------------------------------------------------------------- |  | -----------------------------------------------
|MINNESOTA
(State or other jurisdiction of incorporation or organization)                           |  | 41-0462685
(I.R.S. Employer Identification No.)
|                                                                                                   |  |                                                
|215 SOUTH CASCADE STREET BOX 496, FERGUS FALLS, MINNESOTA
(Address of principal executive offices) |  | 56538-0496
(Zip Code)                          

Registrants telephone number, including area code: 866-410-8780

Securities registered pursuant to Section 12(b) of the Act:

|                        |  |                                              
|----------------------- |  | ---------------------------------------------
|Title of each classNONE |  | Name of each exchange on which registeredNONE

Securities registered pursuant to Section 12(g) of the Act:

COMMON SHARES, par value $5.00 per share
PREFERRED SHARE PURCHASE RIGHTS
CUMULATIVE PREFERRED SHARES, without par value
(Title of class)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. (Yes  X  No __)

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein and will not be contained, to the
best of the registrants knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. (X)

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2
of the Act). (Yes  X  No  )

The aggregate market value of the voting stock held by nonaffiliates on June
30, 2003 was

$675,261,753.


Indicate the number of shares outstanding of each of the registrants classes
of Common Stock, as of the latest practicable date:

25,785,928 Common Shares ($5 par value) as of February 27, 2004.


Documents Incorporated by Reference:

2003 Annual Report to Shareholders-Portions incorporated by reference into Parts I and II
Proxy Statement dated March 17, 2004-Portions incorporated by reference into Part III






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TABLE OF CONTENTS



|                                               |                                                                                                         |  |  |  |  |  |  | 
|---------------------------------------------- | ------------------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I                                        
|                                               | Item 1. BUSINESS                                                                                       
|                                               | Item 2. PROPERTIES                                                                                     
|                                               | Item 3. LEGAL PROCEEDINGS                                                                              
|                                               | Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                            
|                                               | Item 4A. EXECUTIVE OFFICERS OF THE REGISTRANT (AS OF MARCH 1, 2004)                                    
|PART II                                       
|                                               | Item 5. MARKET FOR THE REGISTRANTS COMMON EQUITY AND RELATED STOCKHOLDER MATTERS                      
|                                               | Item 6. SELECTED FINANCIAL DATA                                                                        
|                                               | Item 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS          
|                                               | Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                    
|                                               | Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                                                    
|                                               | Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE           
|                                               | Item 9A. CONTROLS AND PROCEDURES                                                                       
|PART III                                      
|                                               | Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT                                            
|                                               | Item 11. EXECUTIVE COMPENSATION                                                                        
|                                               | Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|                                               | Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                                                
|                                               | Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES                                                        
|PART IV                                       
|                                               | Item 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K                               
|SIGNATURES                                    
|Portions of 2003 Annual Report to Shareholders
|Subsidiaries of Registrant                    
|Consent of Deloitte & Touche LLP              
|Powers of Attorney                            
|Certification of Chief Executive Officer      
|Certification of Chief Financial Officer      
|Certification of CEO - Section 906            
|Certification of CFO - Section 906            



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##### Table of Contents






PART I




Item 1. BUSINESS

(a)  General Development of Business

Otter Tail Corporation (the Company) was incorporated in 1907 under the
laws of the State of Minnesota. The Companys executive offices are located at
215 South Cascade Street, Box 496, Fergus Falls, Minnesota 56538-0496 and 4334
18th Avenue SW, Suite 200, P.O. Box 9156, Fargo, North Dakota 58106-9156. Its
telephone number is (866) 410-8780.

The Company makes available free of charge at its internet website
(www.ottertail.com) its annual reports on Form 10-K, quarterly reports on Form
10-Q, current reports on Form 8-K and any amendments to these reports filed or
furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of
1934 as soon as reasonably practicable after such material is electronically
filed with or furnished to the Securities and Exchange Commission. Information
on the Companys website is not deemed to be incorporated by reference into
this Annual Report on Form 10-K.

In the late 1980s, the Company determined that its core electric business
was located in a region of the country where there was little growth in the
demand for electricity. In order to maintain growth for shareholders, Otter
Tail Power Company (as the Company was known) began to explore opportunities
for the acquisition and long-term ownership of nonelectric businesses. This
strategy has resulted in steady growth over the years. In 2001, the name of the
Company was changed to Otter Tail Corporation to more accurately represent
the broader scope of electric and nonelectric operations and the name Otter
Tail Power Company was retained for use by the electric utility. In 2003,
approximately 64% of the Companys consolidated revenues and approximately 14%
of the Companys consolidated net income came from nonelectric operations.

The Companys strategy is focused on the growth of its operating
companies. The Companys goal is to create value and growth through the
acquisition, long-term ownership and decentralized operation of diverse
businesses. The Companys electric utility provides a strong base of revenues,
cash flows and earnings as part of this strategy. The following guidelines are
considered when reviewing potential acquisition candidates:



| |  |  | Emerging or middle market company;                                                
| | - |  | ----------------------------------------------------------------------------------
|
| |  |  | Proven entrepreneurial management team that will remain after
the acquisition;    
|
| |  |  | Preference for 100% ownership of the acquired company;                            
|
| |  |  | Products and services intended for commercial rather than
retail consumer use; and
|
| |  |  | The potential to provide immediate earnings and future growth.                    

The Company assesses the performance of its operating companies as
follows:



| |  |  | Ability to provide returns on invested capital that exceed
the Companys weighted average cost of capital over the long term;
and
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | Assessment of an operating companys business and the
potential of future earnings growth.                                       

The Company will consider divesting operating companies if they do not meet
these criteria over the long term.

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Otter Tail
Corporation and its subsidiaries conducted business in 48
states and 6 Canadian provinces and had approximately 2,730 full-time employees
at December 31, 2003. The businesses of the Company have been classified into five segments: Electric,
Plastics, Manufacturing, Health
Services and Other Business Operations.



| |  |  | Electric (the Utility) includes the production, transmission,
distribution and sale of electric energy in Minnesota, North Dakota
and South Dakota under the name Otter Tail Power Company. Electric
utility operations have been the Companys primary business since
incorporation.                                                                                                                                                                                                                                                              
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | Plastics consists of businesses producing polyvinyl chloride
and polyethylene pipe in the Upper Midwest and Southwest regions of
the United States.                                                                                                                                                                                                                                                                                                                                                                                                
|
| |  |  | Manufacturing consists of businesses in the following
manufacturing activities: production of waterfront equipment, wind
towers, frame-straightening equipment and accessories for the auto
body shop industry, custom plastic pallets, material and handling
trays and horticultural containers; fabrication of steel products;
contract machining; and metal parts stamping and fabrication. These
businesses are located primarily in the Upper Midwest, Missouri and
Utah.                                                                     
|
| |  |  | Health Services consists of businesses involved in the sale
of diagnostic medical equipment, patient monitoring equipment and
related supplies and accessories. These businesses also provide
service maintenance, mobile diagnostic imaging, mobile positron
emission tomography and nuclear medicine imaging, portable X-ray
imaging and rental of diagnostic medical imaging equipment to
various medical institutions located in 42 states.                                                                                                    
|
| |  |  | Other Business Operations consists of businesses in electrical
and telephone construction contracting, specialty contracting
including design-and-build services for new construction,
transportation, telecommunications, energy services and natural gas
marketing as well as the portion of corporate general and
administrative expenses that are not allocated to other segments.
These businesses operate primarily in the Central United States,
except for the transportation company which operates in 48 states and
6 Canadian provinces.

The Companys
electric operations, including wholesale power sales, are
operated as a division of Otter Tail Corporation, and the Companys energy
services and natural gas marketing operations are operated as an indirect
subsidiary of Otter Tail Corporation. Substantially all the other businesses
are owned by the Companys wholly owned subsidiary, Varistar Corporation
(Varistar).

The Company continues to look for acquisitions of additional businesses
and expects continued growth in this area. The following acquisitions were
completed during 2003:



| |  |  | On November 1, 2003 the Company acquired the assets and
operations of Foley Company (Foley) for $12.3 million in cash. Foley
is a mechanical and prime contracting firm based in Kansas City,
Missouri, that provides a range of specialty contracting including
design-and-build services for new construction, retrofitting,
process piping, equipment settings, and instrumentation and control
systems. Major clients include water and wastewater treatment
plants, hospital and pharmaceutical facilities, power generation
plants, and other industrial and manufacturing projects across a
multi-state service area in the Central United States. Foley had
gross revenues of $44.8 million in 2002. This acquisition expands
the Companys construction services to a broader geographic region.
Foley is included in the Other Business Operations segment.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| |  |  | During 2003, the Company also acquired Topline Medical, Inc.
and North Star Medical Systems, Inc. The aggregate price paid for
the companies was $1.9 million in cash. These acquisitions will
allow the Health Services segment to increase sales opportunities
with an expanded line of products.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The Utility has indicated interest in the South Dakota-based electric and
gas operations of NorthWestern Corporation, which filed for bankruptcy in the
fall of 2003 and is currently restructuring. The Utilitys interest does not
include NorthWesterns Montana property or operations. Because the process has
just begun, it is not possible to determine the likelihood of the acquisition
being completed.

For a discussion of the Companys results of operations, see Managements
Discussion and Analysis of Financial Condition and Results of Operations,
which is incorporated by reference to pages 18 through 30 of the Companys 2003
Annual Report to Shareholders, filed as an Exhibit hereto.

(b)  Financial Information About Industry Segments

The Company is engaged in businesses that have been classified into five
segments: Electric, Plastics, Manufacturing, Health Services and Other Business
Operations. Financial information about the Companys segments is incorporated
by reference to note 2 of Notes to Consolidated Financial Statements on pages
41 and 42 of the Companys 2003 Annual Report to Shareholders, filed as an
Exhibit hereto.

(c)  Narrative Description of Business

ELECTRIC

General

The Utility, which conducts business under the name of Otter Tail Power
Company, provides electricity to more than 127,000 customers in a 50,000 square
mile area of Minnesota, North Dakota and South Dakota. The Company derived 36%
of its consolidated operating revenues from the Electric segment in 2003, 38%
in 2002, and 40% in 2001. The breakdown of retail revenues by state is as
follows:

|             |       |      |      |       |   |  |      |       |  
|------------ | ----- | ---- | ---- | ----- | - |  | ---- | ----- | -
|State        |       | 2003 |      | 2002 
|             |       |      |      |      
|Minnesota    |       |      | 50.2 | %     |   |  | 50.5 | %    
|North Dakota |       |      | 41.4 |       |   |  | 41.2 |      
|South Dakota |       |      | 8.4  |       |   |  | 8.3  |      
|             |       |      |      |       |   |  |      |      
|             | Total |      |      | 100.0 | % |  |      | 100.0 | %
|             |       |      |      |       |   |  |      |      

The territory served by the Utility is predominantly agricultural,
including a part of the Red River Valley. Although there are relatively few
large customers, sales to commercial and industrial customers are significant.
The following table provides a breakdown of electric revenues by customer
category. All other sources include gross wholesale sales and sales to
municipalities and farms.

|                  |       |      |      |       |   |  |      |       |  
|----------------- | ----- | ---- | ---- | ----- | - |  | ---- | ----- | -
|Customer category |       | 2003 |      | 2002 
|                  |       |      |      |      
|Commercial        |       |      | 24.6 | %     |   |  | 29.1 | %    
|Residential       |       |      | 21.2 |       |   |  | 25.0 |      
|Industrial        |       |      | 13.8 |       |   |  | 15.8 |      
|All other sources |       |      | 40.4 |       |   |  | 30.1 |      
|                  |       |      |      |       |   |  |      |      
|                  | Total |      |      | 100.0 | % |  |      | 100.0 | %
|                  |       |      |      |       |   |  |      |      

Wholesale electric energy sales increased from 45.2% of total kwh sales in
2002 to 50.5% of total kwh sales in 2003. Wholesale electric energy kwh sales
grew 24.2% between the years and revenue per kwh increased by 36.1%. Activity
in the short-term energy market is subject

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to change based on a number of factors and it is difficult to predict the quantity of wholesale
power sales or prices for wholesale power in the future. However, the Company
expects that market conditions for wholesale power transactions in 2004 will
not be as robust as in 2003.

The aggregate population of the Utilitys retail electric service area is
approximately 230,000. In this service area of 423 communities and adjacent
rural areas and farms, approximately 130,900 people live in communities having
a population of more than 1,000, according to the 2000 census. The only
communities served which have a population in excess of 10,000 are Jamestown,
North Dakota (15,527); Fergus Falls, Minnesota (13,471); and Bemidji, Minnesota
(11,917). As of December 31, 2003 the Utility served 127,534 customers. This is
an increase of 377 customers from December 31, 2002.

Capability and Demand

At December 31, 2003 and 2002 the Utility had base load net plant
capability as follows:

|                                             |       |            |            |            |            |  |         |  | 
|-------------------------------------------- | ----- | ---------- | ---------- | ---------- | ---------- |  | ------- |  | 
|Base load net plant capability               |       | 2003       |            | 2002      
|                                             |       |            |            |           
|Big Stone Plant                              |       | 252,360 kw |            | 253,508 kw
|Hoot Lake Plant                              |       |            | 153,275    |            |            |  | 154,350 | 
|Coyote Station                               |       |            | 149,450    |            |            |  | 149,450 | 
|Co-generation plant - Bemidji, MN (contract) |       |            | 5,875      |            |            |  | 5,950   | 
|Co-generation plant - Perham, MN (contract)  |       |            | 2,378      |            |            |  |        | 
|                                             |       |            |            |            |            |  |         | 
|                                             | Total |            | 563,338 kw |            | 563,258 kw
|                                             |       |            |            |            |            |  |         | 

The base load net plant capability for Big Stone Plant and Coyote Station
constitutes the Utilitys ownership percentages of 53.9% and 35% respectively.

In addition to its base load capability, the Utility has combustion
turbine and small diesel units owned or under contract, used chiefly for
peaking and standby purposes, with a total capability of 142,026 kw, and
hydroelectric capability of 4,380 kw. The Utility completed the installation of
a peaking combustion turbine in May 2003 with a generation capability of 44,700
kw in summer and 49,500 kw in winter. During 2003, the Utility generated about
79% of its retail kwh sales and purchased the balance.

The Utility has arrangements to help meet its future base load
requirements and continues to investigate other means for meeting such
requirements. The Utility has an agreement with another utility for the annual
exchange of 75,000 kw of seasonal capacity which runs through October 2004. The
Utility has an agreement to purchase 50,000 kw of year-round capacity which
extends through April 30, 2005 and another agreement to purchase 50,000 kw of
year-round capacity through April 30, 2010 from another utility. In 2003 the
Utility also had a seasonal capacity agreement to purchase 10,000 kw for the
months of June and September. The Utility has agreements to purchase the output
from approximately 23,000 kw (nameplate rating) of wind generating facilities.
The Utility has a direct control load management system which provides some
flexibility to the Utility to effect reductions of peak load. The Utility, in
addition, offers rates to customers which encourage off-peak usage.

The Utility traditionally experiences its peak system demand during the
winter season. For the year ended December 31, 2003 the Utility experienced an
all-time system peak demand of 668,703 kw on February 10, 2003. The highest
sixty-minute peak demand prior to 2003 was 642,826 kw on December 14, 2000.
Taking into account additional capacity available to it in February 2003 under
purchase power contracts (including short-term arrangements), as well as its
own generating capacity, the Utilitys capability of then meeting system
demand, including reserve requirements computed in accordance with accepted
industry practice, amounted to 837,590 kw. The Utilitys additional capacity

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available under power purchase contracts (as
described above), combined with generating capability and load management control capabilities, is expected
to
meet 2004 system demand, including industry reserve requirements.

The Utility and a coalition of other electric providers are funding a
study to explore the feasibility of a second electric generating unit,
tentatively named Big Stone II, next to the site of the existing Big Stone
Plant near Milbank, South Dakota. The project would serve the investing
providers native customer loads and would be nominally rated between 400 and
600 megawatts, rate-based and coal fired or coal-and-biomass fired. If the
investing providers decide to proceed, they are expected to sign ownership and
operating agreements in 2004. Permitting, which would require two years, and
construction, which would require three years, could lead to the plant being
operational in 2010. The Utilitys ownership investment is expected to be less
than 25% in the project.

Fuel Supply

Coal is the principal fuel burned at the Big Stone, Coyote and Hoot Lake
generating plants. Coyote, a mine-mouth facility, burns North Dakota lignite
coal. Hoot Lake and Big Stone plants burn western subbituminous coal.

The following table shows the sources of energy used to generate the
Utilitys net output of electricity for 2003 and 2002:

|                    |  |              |           |            |  |              |       |            |  |  |           |  |  |  |       |  
|------------------- |  | ------------ | --------- | ---------- |  | ------------ | ----- | ---------- |  |  | --------- |  |  |  | ----- | -
|                    |  | 2003         |           | 2002      
|                    |  |              |           |           
|                    |  | Net Kilowatt |           | % of Total |  | Net Kilowatt |       | % of Total
|                    |  | Hours        |           | Kilowatt   |  | Hours        |       | Kilowatt  
|                    |  | Generated    |           | Hours      |  | Generated    |       | Hours     
|Sources             |  | (Thousands)  |           | Generated  |  | (Thousands)  |       | Generated 
|                    |  |              |           |            |  |              |       |           
|Subbituminous Coal  |  |              | 2,668,421 |            |  |              | 72.7  | %          |  |  | 2,459,046 |  |  |  | 69.3  | %
|Lignite Coal        |  |              | 955,304   |            |  |              | 26.0  |            |  |  | 1,063,942 |  |  |  | 30.0  |  
|Hydro               |  |              | 14,778    |            |  |              | .4    |            |  |  | 24,220    |  |  |  | .7    |  
|Natural Gas and Oil |  |              | 34,114    |            |  |              | .9    |            |  |  | 1,205     |  |  |  | .0    |  
|                    |  |              |           |            |  |              |       |            |  |  |           |  |  |  |       |  
|Total               |  |              | 3,672,617 |            |  |              | 100.0 | %          |  |  | 3,548,413 |  |  |  | 100.0 | %
|                    |  |              |           |            |  |              |       |            |  |  |           |  |  |  |       |  

The Utility has a primary coal supply agreement with RAG Coal West, Inc.
for the supply of Wyoming subbituminous coal to Big Stone Plant for 2004. The
Company is in negotiations with a new coal supplier for a long-term contract
beginning in 2005. Purchases are made for the supply of subbituminous coal for
the Hoot Lake Plant under a contract with Kennecott Coal Sales Company expiring
June 30, 2004. The Company is in negotiations with the Kennecott Coal Sales
Company for a new coal contract for the Hoot Lake Plant that is expected to be
in place before June 30, 2004. Costs are expected to remain stable. A lignite
coal contract with Dakota Westmoreland Corporation for the Coyote Station
expires in 2016, with a 15-year renewal option subject to certain
contingencies.

It is the Utilitys practice to maintain minimum 30-day inventory (at full
output) of coal at the Big Stone Plant, a 20-day inventory at the Coyote
Station and a 10-day inventory at the Hoot Lake Plant.

Railroad transportation services to the Big Stone Plant are being provided
under a common carrier rate by the Burlington Northern and Santa Fe Railroad
Co. The Company has filed a complaint in regard to this rate with the Surface
Transportation Board requesting the Board set a competitive rate. The Surface
Transportation Board is not likely to act on this complaint until early in
2005. The Company would expect the outcome of the proceeding to have a
favorable impact on its fuel costs for Big Stone Plant. An agreement is in
place with the Burlington Northern and Santa Fe Railroad for Hoot Lake Plant
which expires on July 31, 2004. The Company is working on a new coal
transportation agreement with the Burlington Northern and Santa Fe Railroad for
Hoot Lake Plant. The Company is not expecting significant changes to this

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agreement. No coal transportation agreement is needed for the Coyote Station
due to its location next to a coal mine.

The average cost of coal consumed (including handling charges to the plant
sites) per million BTU for each of the three years 2003, 2002 and 2001 was
$1.189, $1.125, and $1.014, respectively.

The Utility is permitted by the State of South Dakota to burn some
alternative fuels, including tire-derived fuel and biomass, at the Big Stone
Plant. The quantity of alternative fuel burned at the Big Stone Plant is
insignificant when compared to the total annual coal consumption at the Big
Stone Plant.

General Regulation

The Utility is subject to regulation of rates and other matters in each of
the three states in which it operates and by the federal government for certain
interstate operations. A breakdown of electric rate regulation by each
jurisdiction is as follows:

|                                |  |                                      |  |          |      |          |       |          |      |          |       |          |      |   |       |   |      |   |       |  
|------------------------------- |  | ------------------------------------ |  | -------- | ---- | -------- | ----- | -------- | ---- | -------- | ----- | -------- | ---- | - | ----- | - | ---- | - | ----- | -
|                                |  |                                      |  |          |      | 2003     |       | 2002    
|                                |  |                                      |  |          |      |          |       |         
|                                |  |                                      |  |          |      | % of     |       |          |      |          |       | % of     |      |   |       |  
|                                |  |                                      |  |          |      | Electric |       | % of kwh |      | Electric |       | % of kwh
|Rates                           |  | Regulation                           |  | Revenues |      | Sales    |       | Revenues |      | Sales   
|                                |  |                                      |  |          |      |          |       |          |      |         
|MN retail sales                 |  | MN Public Utilities Commission       |  |          | 30.2 | %        |       |          | 25.3 | %        |       |          | 35.8 | % |       |   | 28.3 | %
|ND retail sales                 |  | ND Public Service Commission         |  |          | 25.0 |          |       |          | 20.0 |          |       |          | 29.2 |   |       |   | 21.9 |  
|SD retail sales                 |  | SD Public Utilities Commission       |  |          | 5.0  |          |       |          | 4.2  |          |       |          | 5.8  |   |       |   | 4.5  |  
|Transmission & sales for resale |  | Federal Energy Regulatory Commission |  |          | 39.8 |          |       |          | 50.5 |          |       |          | 29.2 |   |       |   | 45.3 |  
|                                |  |                                      |  |          |      |          |       |          |      |          |       |          |      |   |       |   |      |   |       |  
|                                |  |                                      |  |          |      |          | 100.0 | %        |      |          | 100.0 | %        |      |   | 100.0 | % |      |   | 100.0 | %
|                                |  |                                      |  |          |      |          |       |          |      |          |       |          |      |   |       |   |      |   |       |  

The Utility operates under approved retail electric tariffs in all three
states it serves. The Utility has an obligation to serve any customer
requesting service within its assigned service territory. Accordingly, the
Utility has designed its electric system to provide continuous service at time
of peak usage. The pattern of electric usage can vary dramatically during a
24-hour period and from season to season. The Utilitys tariffs provide for
continuous electric service and are designed to cover the costs of service
during peak times. To the extent that peak usage can be reduced or shifted to
periods of lower usage, the cost to serve all customers is reduced. In order to
shift usage from peak times, the Utility has approved tariffs in all three
states for lower rates for residential demand control and controlled service,
in Minnesota and North Dakota for real-time pricing, and in North Dakota and
South Dakota for bulk interruptible rates. Each of these specialized rates is
designed to improve efficient use of the Utility facilities, while encouraging
use of cost-effective electricity instead of other fuels and giving customers
more control over the size of their electric bill. In all three states, the
Utility has approved tariffs which allow qualifying customers to release and
sell energy back to the Utility when wholesale energy prices make such
transactions desirable.

The majority of the Utilitys electric retail rate schedules now in effect
provide for adjustments in rates based on the cost of fuel delivered to the
Utilitys generating plants, as well as for adjustments based on the cost of
electric energy purchased by the Utility. Such adjustments are presently based
on a two-month moving average in Minnesota and under FERC, a three-month moving
average in South Dakota and a four-month moving average in North Dakota. These
adjustments are applied to the next billing after becoming applicable.

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The following
summarizes the material regulations of each jurisdiction
applicable to the Utilitys electric operations, as well as the specific electric rate proceedings during the last three years with the Minnesota
Public Utilities Commission (MPUC), the North Dakota Public Service Commission
(NDPSC), the South Dakota Public Utilities Commission (SDPUC) and the Federal
Energy Regulatory Commission (FERC). The Companys nonelectric businesses are
not subject to direct regulation by any of these agencies.

Minnesota: Under the Minnesota Public Utilities Act, the Utility is
subject to the jurisdiction of the MPUC with respect to rates, issuance of
securities, depreciation rates, public utility services, construction of major
utility facilities, establishment of exclusive assigned service areas,
contracts and arrangements with subsidiaries and other affiliated interests,
and other matters. The MPUC has the authority to assess the need for large
energy facilities and to issue or deny certificates of need, after public
hearings, within six months of an application to construct such a facility. The
Utility has not had a significant rate proceeding before the MPUC since July
1987.

The Department of Commerce (DOC) is responsible for investigating all
matters subject to the jurisdiction of the DOC or the MPUC, and for the
enforcement of MPUC orders. Among other things, the DOC is authorized to
collect and analyze data on energy and the consumption of energy, develop
recommendations as to energy policies for the governor and the legislature of
Minnesota and evaluate policies governing the establishment of rates and prices
for energy as related to energy conservation. The DOC acts as a state advocate
in matters heard before the MPUC. The DOC also has the power, in the event of
energy shortage or for a long-term basis, to prepare and adopt regulations to
conserve and allocate energy.

Under Minnesota law, every regulated public utility that furnishes
electric service must make annual investments and expenditures in energy
conservation improvements, or make a contribution to the states energy and
conservation account, in an amount equal to at least 1.5% of its gross
operating revenues from service provided in Minnesota. The DOC may require the
utility to make investments and expenditures in energy conservation
improvements whenever it finds that the improvement will result in energy
savings at a total cost to the utility less than the cost to the utility to
produce or purchase an equivalent amount of a new supply of energy. Such DOC
orders are appealable to the MPUC. Investments made pursuant to such orders
generally are recoverable costs in rate cases, even though ownership of the
improvement may belong to the property owner rather than the utility. Since
1995, the Utility has recovered demand-side management related costs not
included in base rates under Minnesotas Conservation Improvement Programs
through the use of an annual recovery mechanism approved by the MPUC.

The MPUC requires the submission of a 15-year advance integrated resource
plan by utilities serving at least 10,000 customers, either directly or
indirectly, and having at least 100 megawatts of load. The MPUCs findings and
orders with respect to these submissions are binding for jurisdictional
utilities. Typically, the filings are submitted every two years. The Utilitys
most recent plan was submitted to the MPUC in 2002 and was approved early in
2003. The MPUC also granted the Utility a one-year waiver in submitting its
next integrated resource plan, which will be completed in 2005.

The MPUC requires the annual filing of a capital structure petition. In
this filing the MPUC reviews and approves the capital structure for the
Company. Once the petition is approved, the Company may issue securities
without further petition or approval, provided the issuance is consistent with
the purposes and amounts set forth in the approved capital structure petition.
The Companys current capital structure petition is in effect until March 31,
2004. The Company filed its capital structure petition for 2004 on February 13,
2004 and is awaiting action from the MPUC.

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The Minnesota
legislature has enacted a statute that favors conservation
over the addition of new resources. In addition, it has mandated the use of
renewable resources where new supplies are needed, unless the utility proves that a renewable energy facility is not in the public interest. It has
effectively prohibited the building of new nuclear facilities. An existing
environmental externality law requires the MPUC, to the extent practicable, to
quantify the environmental costs of each type of generation, and to use such
monetized values in evaluating resource plans. The MPUC must disallow any
nonrenewable rate base additions (whether within or outside of the state) or
any rate recovery therefrom, and may not approve any nonrenewable energy
facility in an integrated resource plan, unless the utility proves that a
renewable energy facility is not in the public interest. The state has
prioritized the acceptability of new generation with wind and solar ranked
first and coal and nuclear ranked fifth, the lowest ranking.

Pursuant to the Minnesota Power Plant Siting Act, the Minnesota
Environmental Quality Board (EQB) has been granted the authority to regulate
the siting in Minnesota of large electric power generating facilities in an
orderly manner compatible with environmental preservation and the efficient use
of resources. To that end, the EQB is empowered, after study, evaluation and
hearings, to select or designate sites in Minnesota for new electric power
generating plants (50,000 kw or more) and routes for transmission lines (100 kv
or more) and to certify such sites and routes as to environmental
compatibility.

The Minnesota Legislature enacted the Minnesota Energy Security and
Reliability Act in 2001. Its primary focus was to streamline the siting and
routing processes for the construction of new electric generation and
transmission projects. The bill also added to utility requirements for
renewable energy and energy conservation.

North Dakota: The Utility is subject to the jurisdiction of the NDPSC with
respect to rates, services, certain issuances of securities and other matters.
The NDPSC periodically performs audits of gas and electric utilities over which
it has rate setting jurisdiction to determine the reasonableness of overall
rate levels. In the past, these audits have occasionally resulted in settlement
agreements adjusting rate levels for the Utility. The North Dakota Energy
Conversion and Transmission Facility Siting Act grants the NDPSC the authority
to approve sites in North Dakota for large electric generating facilities and
high voltage transmission lines. This Act is similar to the Minnesota Power
Plant Siting Act described above and applies to proposed new electric power
generating plants of 50,000 kw or more and proposed new transmission lines of
more than 115 kv. The Utility is required to submit a ten-year plan to the
NDPSC annually.

On December 29, 2000 the NDPSC approved a performance-based ratemaking
(PBR) plan that links allowed earnings in North Dakota to seven performance
standards in the areas of price, electric service reliability, customer
satisfaction and employee safety. The PBR plan is effective for 2001 through
2005, unless suspended or terminated by the NDPSC or the Utility. This PBR
plan provides the opportunity for the Utility to raise its allowed rate of
return and share income with customers when earnings exceed the allowed
return. During 2001, the Utility achieved a rate of return on equity that
exceeded targets under the plan, resulting in a sharing of the income between
shareholders and customers in the form of a $662,300 refund to North Dakota
retail electric customers in 2002. Because the Utilitys 2002 rate of return
was within the allowable range defined in the plan, no sharing occurred in
2003. The Utilitys 2003 rate of return is expected to be within the allowable
range defined in the plan.

The NDPSC reserves the right to review the issuance of stocks, bonds,
notes and other evidence of indebtedness of a public utility. However, the
issuance by a public utility of securities registered with the Securities and
Exchange Commission is expressly exempted from review by the NDPSC under North
Dakota state law.

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South Dakota: The
South Dakota Public Utilities Act subjects the Utility
to the jurisdiction of the SDPUC with respect to rates, public utility services, establishment of assigned service areas and other matters. The
Utility is not currently subject to the jurisdiction of the SDPUC with respect
to the issuance of securities. Under the South Dakota Energy Facility Permit
Act, the SDPUC has the authority to approve sites in South Dakota for large
energy conversion facilities (100,000 kw or more) and transmission lines of 115
kv or more. There have been no significant rate proceedings in South Dakota
since November 1987.

FERC: Wholesale power sales and transmission rates are subject to the
jurisdiction of the FERC under the Federal Power Act of 1935, as amended (FPA).
The FERC is an independent agency which has jurisdiction over rates for
electricity sales for resale, transmission and sale of electric energy in
interstate commerce, interconnection of facilities, and accounting policies and
practices. Filed rates are effective after a one-day suspension period, subject
to ultimate approval by the FERC. The Utility is a member of the Mid-Continent
Area Power Pool (MAPP), which operates in parts of eight states in the Upper
Midwest and in three provinces in Canada. Power pool sales are conducted
continuously through MAPP in accordance with schedules filed by MAPP with the
FERC. Additional MAPP functions include a regional reliability council that
maintains generation reserve sharing requirements.

The Utility agreed in October 2001 to join the Midwest Independent System
Operator (MISO) regional transmission organization (RTO) pursuant to FERC Order
No. 2000. In December 2001, the MISO received FERC approval as a regional
transmission organization. FERCs view is that the MISO will benefit the public
interest by enhancing the reliability of the Midwest electric grid and
facilitating and enhancing wholesale competition. The MISO covers a broad
region containing all or parts of 20 states and one Canadian province. The MISO
began operational control of the Utilitys transmission facilities above 100 kv
on February 1, 2002, but the Utility continues to own and maintain its
transmission assets. As the transmission provider and security coordinator for
the region, the MISO offers available capacity, accepts schedules and provides
settlement for transmission services.

In July 2002, the FERC issued a Notice of Proposed Rulemaking (NOPR) on
Standard Market Design (SMD). Its purpose is to insure standard commercial
rules for the operation of competitive markets for electricity. The SMD NOPR
calls for markets to be operational across the United States by the end of
2004. In 2003 SMD met significant political resistance. As a result, FERC
published a Wholesale Market Platform (WMP) white paper that provides for
regional flexibility and state regulator involvement through Regional State
Committees (RSCs). The MISO, with strong FERC encouragement, had established
the end of 2003 as a target for MISO markets to be operational within its
geographical area of operation. In July 2003, the MISO filed its proposed
Transmission and Energy Markets Tariff (TEMT). In October 2003, the MISO
withdrew its TEMT. The MISO has stated its plans to refile its TEMT in March of
2004. The MISO is proposing an operational date of December 1, 2004. The MISO
is working together with the FERC on this process and has requested assurances
from FERC that all start-up costs will be recoverable for market participants.
As the Utility transitions to the full operation of the MISO there could be
short-term negative impacts on wholesale power transactions.

Other: The Utility is subject to various federal and state laws, including
the Federal Public Utility Regulatory Policies Act and the Energy Policy Act of
1992, which are intended to promote the conservation of energy and the
development and use of alternative energy sources. The Utility may also become
subject to comprehensive energy legislation currently pending before the United
States Congress.

The Utility is unable to predict the impact on its operations resulting
from future regulatory activities, from future legislation or from future tax
that may be imposed on the source or use of energy.

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Competition, Deregulation and Legislation

Electric sales are subject to competition in some areas from municipally
owned systems, rural electric cooperatives and, in certain respects, from
on-site generators and cogenerators. Electricity also competes with other forms
of energy. The degree of competition may vary from time to time depending on
relative costs and supplies of other forms of energy. The Utility may also face
competition as the restructuring of the electric industry evolves.

The Company believes the Utility is well positioned to be successful in a
more competitive environment. A comparison of the Utilitys electric retail
rates to the rates of other investor-owned utilities, cooperatives and
municipals in the states the Utility serves indicates that the Utilitys rates
are competitive. In addition, the Utility would attempt more flexible pricing
strategies under an open, competitive environment.

Legislative and regulatory activity could affect operations in the future.
The Utility cannot predict the timing or substance of any future legislation or
regulation. State and federal efforts to restructure the electric utility
industry have slowed. The United States Congress ended its 2003 legislative
session without passing electric industry restructuring legislation or a
comprehensive energy bill. There was no legislative action in 2003 regarding
electric retail choice in any of the states where the Utility operates and no
major electricity legislation is expected in 2004 legislative sessions in those
states. The Company does not expect retail competition to come to the States of
Minnesota, North Dakota or South Dakota in the foreseeable future.

Environmental Regulation

Impact of Environmental Laws: The Utilitys existing generating plants are
subject to stringent federal and state standards and regulations regarding,
among other things, air, water and solid waste pollution. The Utility estimates
it has expended in the five years ended December 31, 2003 approximately $6.4
million for environmental control facilities. Included in the 2004-2008
construction budget are approximately $6 million for environmental equipment
for existing and new facilities, including $1.1 million for 2004.

Air Quality: Pursuant to the Federal Clean Air Act of 1970 as amended
(the Act), the United States Environmental Protection Agency (EPA) has
promulgated national primary and secondary standards for certain air
pollutants.

The primary fuels burned by the Utilitys steam generating plants are
North Dakota lignite coal and western subbituminous coal. Electrostatic
precipitators have been installed at the principal units at the Hoot Lake
Plant. A fabric filter to collect particulates from stack gases has been
installed on a smaller unit at Hoot Lake Plant. As a result, the units at the
Hoot Lake Plant currently meet all presently applicable federal and state air
quality and emission standards.

The Utility improved the fine particulate emissions control at Big Stone
Plant by replacing a major portion of the plants electrostatic precipitator in
the third quarter of 2002. The replacement technology is an Advanced Hybrid
technology that was installed as part of a demonstration project co-funded by
the Department of Energys National Energy Technology Laboratory Power Plant
Improvement Initiative. The technology is designed to capture at least 99.99%
of the fly ash particulates emitted from the boiler. Initial test data
demonstrates the emissions design parameters were met, and follow-up emission
testing is planned for 2004. However, the Department of Energys National
Energy Technology Laboratory, consultants, equipment vendors and the Utility
jointly continue to investigate and assess the operational performance of the
unit as well as options to improve the Advanced Hybrids balance-of-plant
impacts as part of an on-going effort to refine the demonstration technology.

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The Big Stone Plant is currently operating within all presently applicable
federal and state air quality and emission standards.

The Coyote Station is equipped with sulfur dioxide removal equipment. The
removal equipmentreferred to as a dry scrubberconsists of a spray dryer,
followed by a fabric filter, and is designed to desulfurize hot gases from the
stack. The fabric filter collects spray dryer residue along with the fly ash.
The Coyote Station is currently operating within all presently applicable
federal and state air quality and emission standards.

The Act, in addressing acid deposition, imposed requirements on power
plants in an effort to reduce national emissions of sulfur dioxide (SO2) and
nitrogen oxides (NOx).

The national SO2 emission reduction goals are achieved through a
market-based system under which power plants are allocated emissions
allowances that will require plants to either reduce their emissions or
acquire allowances from others to achieve compliance. Each allowance is an
authorization to emit one ton of sulfur dioxide. Sulfur dioxide emission
requirements are currently being met by all of the Utilitys generating
facilities without the need to acquire other allowances for compliance.

The national NOx emission reduction goals are achieved by imposing
mandatory emissions standards on individual sources. Hoot Lake Plant unit 2 is
governed by the phase one early opt-in provision until January 1, 2008. The
remaining generating units meet the NOx emission regulations that were adopted
by the EPA in December 1996. All of the Utilitys generating facilities met the
NOx standards during 2003.

The EPA Administrator signed the proposed Interstate Air Quality Rule on
December 17, 2003. EPA has concluded that SO2 and NOx are the chief emissions
contributing to interstate transport of particulate matter less than 2.5
microns (PM2.5). EPA has also concluded that NOx emissions are the chief
emissions contributing to ozone non-attainment. Plans are to finalize the rule
by mid-2005. Twenty-eight states and the District of Columbia were found to
contribute 0.15 micrograms per cubic meter or more to ambient air quality PM2.5
non-attainment in downwind states. On that basis, EPA is proposing to cap SO2
and NOx emissions in the designated states. Minnesota is included among the 28
states for emissions caps. Twenty-five states were found to contribute to
downwind 8-hour ozone non-attainment. None of the states in the Utilities
service territory are slated for NOx reduction for ambient air quality 8-hour
ozone non-attainment purposes, although EPA is proposing further study of the
contributions from the North Dakota and South Dakota. The Utility is evaluating
the proposal and is unable to assess its impact until the final rule
promulgation.

The Act calls for EPA studies of the effects of emissions of listed
pollutants by electric steam generating plants. The EPA has completed the
studies and submitted reports to Congress. The Act required the EPA to make a
finding as to whether regulation of emissions of hazardous air pollutants from
fossil fuel-fired electric utility generating units is appropriate and
necessary. On December 14, 2000 the EPA announced that it affirmatively decided
to regulate mercury emissions from electric generating units. The EPA published
the proposed mercury rule on January 30, 2004. The proposal included two
options for regulating mercury emission from coal-fired electric generating
units. One option would set technology-based maximum achievable control
technology standards under paragraph 111(d) of the Act. The other option
embodies a market-based cap and trade approach to emissions reduction. The
Utility is currently evaluating the proposal. The EPA expects to issue final
rules by December 2004. Because promulgation of rules by the EPA has not been
completed, it is not possible to assess to what extent this regulation will
impact the Utility.

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In 1998, the EPA
announced its New Source Review Enforcement Initiative
targeting coal-fired utilities, petroleum refineries, pulp and paper mills and other industries for alleged violations of EPAs New Source Review
rules. These
rules require owners or operators that construct new major sources or make
major modifications to existing sources to obtain permits and install air
pollution control equipment at affected facilities. The EPA is attempting to
determine if emission sources violated certain provisions of the Act by making
major modifications to their facilities without installing state-of-the-art
pollution controls. On January 2, 2001, the Utility received a request from the
EPA, pursuant to Section 114(a) of the Act, to provide certain information
relative to past operation and capital construction projects at the Big Stone
Plant. The Utility responded to that request. In March 2003 the EPA conducted a
review of the plants outage records as a follow-up to their January 2001 data
request. A copy of the designated documents was provided to EPA on March 21,
2003. At this time the Utility cannot determine what, if any, actions will be
taken by the EPA. The EPA issued changes to the existing New Source Review
rules with respect to routine maintenance and repair and replacement activities
in its Equipment Replacement Provision Rule on October 27, 2003. However, the
U.S. Court of Appeals for the D.C Circuit issued an order which stayed the
effective date of the Equipment Replacement Provision rule pending judicial
review. The Utility is awaiting the Courts decision on the challenges to the
rule, which is expected in 2005.

The Coyote Station is subject to certain emission limitations under the
Prevention of Significant Deterioration (PSD) program of the Act. The EPA and
the North Dakota Department of Health reached an agreement to identify a
process for resolving several issues relating to the modeling protocol for the
states PSD program. A cap on the SO2 emissions could be imposed on all the
coal-fired steam-electric generating units that are located in North Dakota,
including the Coyote Station, as a result of the modeling effort. If a cap were
imposed, it is likely the cap would be set at a level above current actual
emission levels. The impact of a cap on SO2 emissions on future operations, if
it were imposed, is uncertain.

The Dakota Resource Council filed a civil action against the EPA asking
that the Court order EPA to perform the alleged non-discretionary duty of
requiring the State of North Dakota to take steps to remedy alleged unlawful
levels of SO2 in Theodore Roosevelt National Park, Lostwood Wilderness Area,
Medicine Lakes Wilderness Area, and Fort Pect Indian Reservation. The Utility
has joined with other North Dakota utilities in a Motion to Intervene in this
proceeding.

Water Quality: The Federal Water Pollution Control Act Amendments of 1972,
and amendments thereto, provide for, among other things, the imposition of
effluent limitations to regulate discharges of pollutants, including thermal
discharges, into the waters of the United States, and the EPA has established
effluent guidelines for the steam electric power generating industry.
Discharges must also comply with state water quality standards.

On February 16, 2004, the EPA Administrator signed the final Phase II rule
implementing Section 316(b) of the Clean Water Act establishing standards for
cooling water intake structures for certain existing facilities. The rule
becomes effective 60 days after its publication in the Federal Register.The
Utility is currently evaluating the impact of the rule on its facilities.

The Utility has all federal and state water permits presently necessary
for the operation of the Coyote Station, the Big Stone Plant and the Hoot Lake
Plant. The Utility owns five small dams on the Otter Tail River, which are
subject to FERC licensing requirements. A license for all five dams was issued
on December 5, 1991. Total nameplate rating (manufacturers expected output) of
the five dams is 3,450 kw.

Solid Waste: Permits for disposal of ash and other solid wastes have been
issued for the Coyote Station, the Big Stone Plant and the Hoot Lake Plant. The
Utility completed construction on the first cell of the new ash disposal site
at Hoot Lake Plant in 2003, and it is available for use when the existing
disposal area is filled later in 2004.

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At the request of the Minnesota Pollution Control Agency (MPCA), the
Utility has an ongoing investigation at its former, closed Hoot Lake Plant ash
disposal sites. The MPCA continues to monitor site activities under their
Voluntary Investigation and Cleanup Program. In April 2001, the Utility
submitted a Remedial Investigation Work Plan to the MPCA describing its plan to
further investigate the environmental impact of the closed portion of the Hoot
Lake Plant ash disposal site. The MPCA approved the plan, with some suggested
modifications, in July 2001. These tasks have been completed. The MPCA also
asked that the Utility eliminate a ground water seepage that was originating
from one of the disposal areas. Site work related to that request was completed
in November 2001. However, seepage reappeared in a new location in the spring
of 2002. The Utility initiated additional studies to further characterize the
site and its report was submitted to the MPCA in March 2003 for their review
and comment. The MPCA approved portions of the remediation measures that the
Utility proposed and those were implemented in 2003. Although the Utility is
still evaluating various options, its preliminary estimate of remediation costs
to address the ash disposal site issues over the next three years is not
expected to have a material impact on the Companys consolidated net income,
financial position or cash flows.

The EPA has promulgated various solid and hazardous waste regulations and
guidelines pursuant to, among other laws, the Resource Conservation and
Recovery Act of 1976, the Solid Waste Disposal Act Amendments of 1980 and the
Hazardous and Solid Waste Amendments of 1984, which provide for, among other
things, the comprehensive control of various solid and hazardous wastes from
generation to final disposal. The States of Minnesota, North Dakota and South
Dakota have also adopted rules and regulations pertaining to solid and
hazardous waste. The total impact on the Utility of the various solid and
hazardous waste statutes and regulations enacted by the federal government or
the States of Minnesota, North Dakota and South Dakota is not certain at this
time. To date, the Utility has incurred no significant costs as a result of
these laws.

In 1980, the United States enacted the Comprehensive Environmental
Response, Compensation and Liability Act, commonly known as the Federal
Superfund law, which was reauthorized and amended in 1986. In 1983, Minnesota
adopted the Minnesota Environmental Response and Liability Act, commonly known
as the Minnesota Superfund law. In 1988, South Dakota enacted the Regulated
Substance Discharges Act, commonly known as the South Dakota Superfund law. In
1989, North Dakota enacted the Environmental Emergency Cost Recovery Act. Among
other requirements, the federal and state acts establish environmental response
funds to pay for remedial actions associated with the release or threatened
release of certain regulated substances into the environment. These federal and
state Superfund laws also establish liability for cleanup costs and damage to
the environment resulting from such release or threatened release of regulated
substances. The Minnesota Superfund law also creates liability for personal
injury and economic loss under certain circumstances. The Utility is unable to
determine the total impact of the Superfund laws on its operations at this time
but has not incurred any significant costs to date related to these laws. The
Utility is not presently named as a potentially responsible party under the
federal or state Superfund laws.

Capital Expenditures

The Utility is continually expanding, replacing and improving its electric
facilities. During 2003, approximately $28.2 million was invested for additions
and replacements to its electric utility properties. During the five years
ended December 31, 2003 gross electric property additions, including
construction work in progress, were approximately $161.1 million and gross
retirements were approximately $53.2 million.

The Utility estimates that during the five-year period 2004-2008 it will
invest approximately $132 million for electric construction. The Utility
continuously reviews options for increasing its generating capacity. At this
time the Utility has no firm plans for additional base load

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generating plant construction. The majority of electric utility expenditures for the
five-year period 2004 through 2008 will be for work related to the Utilitys
production plants and distribution system.

Franchises

At December 31, 2003 the Utility had franchises to operate as an electric
utility in all of the 371 incorporated municipalities that it serves. All
franchises are nonexclusive and generally were obtained for 20-year terms, with
varying expiration dates. No franchises are required to serve unincorporated
communities in any of the three states that the Utility serves. There are 19
franchises that are set to expire during 2004. The Utility believes that these
franchises will be renewed.

Employees

At December 31, 2003 the Utility had approximately 667 full-time
employees. A total of 354 employees are represented by local unions of the
International Brotherhood of Electrical Workers and are covered by a three-year
labor contract expiring November 1, 2005. The Utility has not experienced any
strike, work stoppage or strike vote, and considers its present relations with
employees to be good.

PLASTICS

General

Plastics consists of businesses producing polyvinyl chloride (PVC) and
polyethylene (PE) pipe. The Company derived 11% of its consolidated operating
revenues from this segment in 2003, 13% in 2002, and 11% in 2001.



| |                                                          
| | ---------------------------------------------------------
| | The following is a brief description of these businesses:



| |                                                                                                                                                                                                                                                                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Northern Pipe Products, Inc., located in Fargo, ND, manufactures and
sells PVC and PE pipe for municipal water, rural water, wastewater and other uses in the Northern, Midwestern and
Western regions of the United States as well as Canada. During 2003, a
45,000-square-foot plant was opened in Hampton, IA for the production of
corrugated PE pipe used in drainage and sewer systems.



| |                                                                                                                                                                                                                                   
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Vinyltech Corporation, located in Phoenix, AZ, manufactures and sells PVC
pipe for municipal water, wastewater, water reclamation
systems and other uses in the Western, Southwest and South Central
regions of the United States.

Together these companies have the capacity to produce approximately
200 million pounds of PVC and PE pipe annually.

Customers

The PVC and PE pipe products are marketed through a combination of
independent sales representatives, company salespersons and customer service
representatives. Customers for the PVC and PE pipe products consist primarily
of wholesalers and distributors throughout the Upper Midwest, Southwest and
Western United States.

Competition

The plastic pipe industry is highly competitive, due to a relatively small
number of producers, an even smaller number of raw material suppliers and the
commodity nature of the product. Because of shipping costs, competition is
usually regional in scope, instead of national.

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Northern Pipe and Vinyltech
compete not only against other plastic pipe manufacturers, but also ductile iron, steel, concrete and clay pipe producers. Pricing
pressure will continue to affect operating margins in the future.

Northern Pipe and Vinyltech intend to continue to compete on the basis of
their high quality products, cost-effective production techniques and close
customer relations and support.

Manufacturing and Resin Supply

PVC pipe is manufactured through a process known as extrusion. During the
production process, PVC compound (a dry powder-like substance) is introduced
into an extrusion machine, where it is heated to a molten state and then forced
through a sizing apparatus to produce the pipe. The newly extruded pipe is then
pulled through a series of water cooling tanks, marked to identify the type of
pipe and cut to finished lengths. Warehouse and outdoor storage facilities are
used to store the finished product. Inventory is shipped from storage to
customers mainly by common carrier.

The PVC resins are acquired in bulk and shipped to point of use by rail
car. Over the last ten years, there has been consolidation in PVC resin
producers. There are a limited number of third party vendors that supply the
PVC resin used by Northern Pipe and Vinyltech. During 2003, three vendors
supplied the resin used, with over 96% of the resin purchased from two main
vendors. During 2002, seven vendors supplied the resin used, with over 58% of
the resin purchased from two main vendors. In 2001, two vendors provided
approximately 75% of the PVC resin used. The loss of a key vendor, or any
interruption or delay in the supply of PVC resin, could disrupt the ability of
the Plastics segment to manufacture products, cause customers to cancel orders
or require incurrence of additional expenses to obtain PVC resin from
alternative sources, if such sources were available. Both Northern Pipe and
Vinyltech believe they have good relationships with their key raw material
vendors.

Due to the commodity nature of PVC resin and PVC pipe and the dynamic
supply and demand factors worldwide, historically the markets for both PVC
resin and PVC pipe have been very cyclical with significant fluctuations in
prices and gross margins.

Capital Expenditures

Capital expenditures in the Plastics segment typically include investments
in extrusion machines, land and buildings and management information systems.
During 2003, capital expenditures of approximately $3.9 million were made in
the Plastics segment. The 2003 expenditures relate to the opening of the new PE
plant in Hampton, IA. Total capital expenditures during the five-year period
2004-2008 are estimated to be approximately $12 million.

Employees

At December 31, 2003 the Plastics segment had approximately 178 full-time
employees.

MANUFACTURING

General

Manufacturing consists of businesses in the following manufacturing
activities: production of waterfront equipment, wind towers,
frame-straightening equipment and accessories for the auto body shop industry,
custom plastic pallets, material and handling trays and horticultural
containers; fabrication of steel products; contract machining; and metal parts
stamping and fabrication.

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The Company derived 24% of its consolidated operating revenues from this
segment in 2003, 22% in 2002 and 21% in 2001. The following is a brief
description of each of these businesses:



| |                                                                                                                                                                                                                                                                                                                                                                                                            
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | BTD Manufacturing, Inc. (BTD), located in Detroit Lakes and Pelican
Rapids, MN, is a metal stamping and tool and die manufacturer that
provides its services mainly to customers in the Midwest. BTD stamps,
fabricates, welds and laser cuts metal components according to
manufacturers specifications primarily for the recreation vehicle, gas
fireplace, health and fitness and enclosure industries.



| |                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Chassis Liner Corporation, located in Alexandria and Lucan, MN,
manufactures and markets vehicle frame-straightening equipment and
accessories used by the auto repair industry throughout the United
States.



| |                                                                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
| | DMI Industries, Inc., located in West Fargo, ND, engineers and
manufactures wind towers and other heavy metal fabricated products
throughout the United States.



| |                                                                                                                                                                                                                                                                                                            
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | ShoreMaster, Inc., located in Fergus Falls, MN, along with its wholly
owned subsidiary, Galva Foam Marine, Inc. located in Camdenton, MO,
produces residential and commercial waterfront equipment, ranging from
boatlifts and docks to full marina systems that are marketed throughout
the United States.



| |                                                                                                                                                                                                                                                                                                                                                                     
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | St. George Steel Fabrication, Inc., located in St. George and Salt Lake
City, UT, fabricates structural steel members for buildings and bridges,
ductwork for the power and refining industries, conveyors and hoppers for
mining and industrial markets and plate steel products for the wind tower
industry, primarily for customers in the Western United States.



| |                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | T. O. Plastics, Inc., located in Minneapolis and Clearwater, MN, and
Hampton, SC, manufactures and sells plastic thermoformed products for the
horticulture industry throughout the United States. In addition,
T. O. Plastics produces products such as clamshell packing, blister
packs, returnable pallets and handling trays for shipping and storing
odd-shaped or difficult-to-handle parts for other industries.

Competition

The various markets in which the Manufacturing segment entities compete
are characterized by intense competition. These markets have many established
manufacturers with broader product lines, greater distribution capabilities,
greater capital resources and larger marketing, research and development staffs
and facilities than the Companys manufacturing entities.

The Company believes the principal competitive factors in its
Manufacturing segment are product performance, quality, price, ease of use,
technical innovation, cost effectiveness, customer service and breadth of
product line. The Companys manufacturing entities intend to continue to
compete on the basis of their high-performance products, innovative
technologies, cost-effective manufacturing techniques, close customer relations
and support, and their strategy of increasing product offerings.

Some of the products sold by the companies in the Manufacturing segment
are purchased by companies in the recreational vehicle, wind energy and auto
repair markets. A downturn in these markets could have an adverse impact on the
financial results of the Companys Manufacturing segment.

16



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##### Table of Contents



Steel Supply

Many of companies
in the Manufacturing segment use a variety of steel in
the products that they manufacture. Steel prices have increased significantly
due to a number of factors including demand from Chinas expanding
economy, elevated energy prices that increase the cost of making steel, a
shortage of
coke (a substance made from coal that is used in making steel) and the falling
dollar increasing the cost of imported steel. Both pricing and availability are
concerns of steel users. Some steel companies are adding surcharges to offset
their higher costs. The companies in the Manufacturing segment will attempt to
pass the surcharges on to their customers. The increase in steel prices could
have a negative affect on profit margins in the Manufacturing segment.LegislationThe failure of Congress to pass a broad energy bill in 2003 and extend the
Production Tax Credit could have an unfavorable impact on the Companys
operations that manufacture towers for the wind energy industry.Capital ExpendituresCapital expenditures in the Manufacturing segment typically include
additional investments in new manufacturing equipment or expenditures to
replace worn-out manufacturing equipment. Capital expenditures may also be made
for the purchase of land and buildings for plant expansion and for investments
in management information systems. During 2003, capital expenditures of
approximately $9.9 million were made in the Manufacturing segment. Total
capital expenditures for the Manufacturing segment during the five-year period
2004-2008 are estimated to be approximately $43 million.EmployeesAt December 31, 2003 the Manufacturing segment had approximately 1,067
full-time employees.HEALTH SERVICESGeneralHealth Services consists of the DMS Health Group, which includes
businesses involved in the sale of diagnostic medical equipment, patient
monitoring equipment and related supplies and accessories. These businesses
also provide service maintenance, mobile diagnostic imaging, mobile positron
emission tomography and nuclear medicine imaging, portable X-ray imaging and
rental of diagnostic medical imaging equipment.During 2003, two small acquisitions were completed in this segment,
Topline Medical, Inc. and North Star Medical Systems, Inc. These companies sell
cardiac patient monitoring equipment to healthcare facilities in the Upper
Midwest.The Company derived 13% of its consolidated operating revenues from this
segment in 2003 and 14% in 2002 and 2001. The companies comprising the DMS
Health Group include:DMS Health Technologies, Inc. (DMS), located in Fargo, ND, sells,
services and refurbishes diagnostic medical imaging equipment, patient
monitoring equipment and related supplies and accessories. DMS sells
radiology equipment primarily manufactured by Philips Medical Systems
(Philips), a large multi-national company based in the Netherlands.
Philips manufactures fluoroscopic, radiographic and mammography
equipment, along with ultrasound, computerized tomography (CT) scanners,
magnetic resonance imaging (MRI) scanners and cardiac cath labs. In
December 2003 the Companys dealership agreement with Philips was
renewed. DMS is also a supplier of medical film and related accessories.
DMS markets mainly to hospitals, clinics and mobile service companies in
North Dakota, South Dakota, Minnesota, Montana and Wyoming.17Table of ContentsDMS Imaging, Inc., a subsidiary of DMS Health Technologies, Inc. located
in Minneapolis, MN, operates mobile and in-house diagnostic medical
imaging equipment, including CT, MRI, positron-emission tomography (PET),
nuclear medicine services and other similar radiology services to
hospitals, clinics, long-term care facilities and other medical providers
located in 42 states. Regional offices are located in Houston, TX;
Minneapolis, MN; and Sioux Falls, SD. DMS Imaging provides services in
four different business units:
    
    DMS Imaging - provides shared diagnostic
medical imaging services (primarily mobile) for MRI, CT,
nuclear medicine, PET, ultrasound, mammography and bone
density analysis.
    
    DMS Interim Solutions - offers interim and
rental options for diagnostic imaging services.
    
    DMS MedSource Partners - develops
partnerships with healthcare providers to offer dedicated
in-house diagnostic imaging services, such as MRI.
    
    DMS Portable X-Ray - delivers portable
X-ray, ultrasound and electrocardiogram services to nursing
homes and other facilities.Combined, the DMS Health Group covers the three basics of the medical
imaging industry: (1) ownership and operation of the imaging equipment for
healthcare providers; (2) sale, lease and/or maintenance of medical imaging
equipment and related supplies; and (3) scheduling, billing and administrative
support of medical imaging services.RegulationThe healthcare industry is subject to federal and state regulations
relating to licensure, conduct of operation, ownership of facilities, payment
of services and addition of facilities and services.The federal Anti-Kickback Act prohibits persons from knowingly and
willfully soliciting, receiving, offering or providing remuneration, directly
or indirectly, to induce the referral of an individual or the furnishing or
arranging for a good or service for which payment may be made under a federal
healthcare program such as Medicare or Medicaid. Several states have similar
statutes. The term remuneration has been broadly interpreted to include
anything of value, including, for example, gifts, discounts, credit
arrangements, payments of cash, waiver of payments and ownership interests.
Penalties for violating the Anti-Kickback Act can include both criminal
penalties and civil sanctions. By regulation, the U.S. Department of Health and
Human Services has created certain safe harbors under the Act. These safe
harbor regulations set forth certain provisions, which, if met, assure that
healthcare providers will not be subject to liability under the Act.The Ethics and Patient Referral Act of 1989 (the Stark Act) prohibits
physician referrals of Medicare and Medicaid patients to an entity providing
certain designated health services, including services provided by the Health
Services companies. The Stark Act also prohibits an entity from billing for
prohibited services. A person who engages in a scheme to violate the Stark Act
or a person who presents a claim to Medicare or Medicaid in violation of the
Stark Act may be subject to civil fines and possible exclusion from
participation in federal healthcare programs.The Health Services companies believe their operations comply with the
Anti-Kickback Act and the Stark Act. However, if the Health Services companies
were to engage in conduct in violation of these statutes, the sanction imposed
could adversely affect the Companys consolidated financial results.18Table of ContentsThe Health
Insurance Portability and Accountability Act of 1996 (HIPAA)
created federal crimes related to healthcare fraud and to making false
statements related to healthcare matters. HIPAA prohibits knowingly and willfully executing a scheme to defraud any healthcare benefit program
including a program involving private payors. Further, HIPAA prohibits
knowingly and willfully falsifying, concealing or covering up a material fact
or making any materially false statement in connection with the delivery of or
payment for healthcare benefits or services. A violation of HIPAA is a felony
and may result in fines, imprisonment or exclusion from government-sponsored
programs such as Medicare and Medicaid. Finally, HIPAA creates federal privacy
standards for individually identifiable health information and computer
security standards for all health information. These standards became
applicable in 2003 and the Health Services companies believe that they are in
compliance with the requirements of HIPAA. However, if the Health Services
companies were to engage in conduct in violation of these statutes, the
sanction imposed could adversely affect the Companys financial results.In some states a certificate of need or similar regulatory approval is
required prior to the acquisition of high-cost capital items or services,
including diagnostic imaging systems or provisions of diagnostic imaging
services by companies or its customers. Certificate of need laws were enacted
to contain rising healthcare costs by preventing unnecessary duplication of
health resources. Certificate of need regulations may limit or preclude the
Health Services companies from providing diagnostic imaging services or
systems. Conversely, a repeal of existing certificate of need regulations in
states where the Health Services companies have obtained certificates of need
could adversely affect their financial performance.The Health Services companies continue to monitor developments in
healthcare law and modify their operations from time to time as the business
and regulatory environment changes. However, there can be no assurances that
the Health Services companies will always be able to modify their operations to
address changes in the regulatory environment without any adverse effect to
their financial performance.ReimbursementThe companies in the Health Services segment derive most of their revenues
directly from healthcare providers rather than third-party payors, such as
Medicare, Medicaid or private health insurance companies. The Health Services
customers who are healthcare providers receive the majority of their payments
from third-party payors. Payments by third-party payors depend upon their
customers health insurance policies. Because unfavorable reimbursement
policies have limited and may continue to limit the profit margins of hospitals
and clinics the Health Services companies bill directly, it may be necessary to
lower fees to retain existing customers and attract new ones.CompetitionThe market for selling, servicing and operating diagnostic imaging
services, patient monitoring equipment and imaging systems is highly
competitive. In addition to direct competition from other contract providers,
the companies within Health Services compete with free-standing imaging centers
and health care providers that have their own diagnostic imaging systems and
with equipment manufacturers that sell imaging equipment to healthcare
providers for full-time installation. Some of the direct competitors, which
provide contract MRI services, have access to greater financial resources than
the Health Services companies. In addition, some of Health Services customers
are capable of providing the same services to their patients directly, subject
only to their decision to acquire a high-cost diagnostic imaging system, assume
the financial and technology risk, and employ the necessary technologists. The
companies in the Health Services segment may also experience greater
competition in states that currently have certificate of need laws should these
laws be repealed, reducing barriers to entry in that state. The companies
within this segment compete against other contract providers on the basis of
quality of services, quality and magnetic
field strength19Table of Contentsof imaging systems, relationships with health
care providers, knowledge and service quality of technologists, price, availability and
reliability.Environmental, Health or Safety LawsPositron emission tomography services and some other imaging services
require the use of radioactive material. While this material has a short life
and quickly breaks down into inert, or non-radioactive substances, using such
materials presents the risk of accidental environmental contamination and
physical injury. Federal, state and local regulations govern the storage, use
and disposal of radioactive material and waste products. The Company believes
that its safety procedures for storing, handling and disposing of these
hazardous materials comply with the standards prescribed by law and regulation;
however the risk of accidental contamination or injury from those hazardous
materials cannot be completely eliminated. The companies in the Health Services
segment have not had any material expenses related to environmental, health or
safety laws or regulations.Capital ExpendituresCapital expenditures in this segment principally relate to the acquisition
of diagnostic imaging equipment used in the imaging business. During 2003,
capital expenditures of approximately $5.4 million were made in the Health
Services segment. Total capital expenditures during the five-year period
2004-2008 are estimated to be approximately $5 million. Operating leases are
also used to finance the acquisition of medical equipment used by Health
Services companies. Current operating lease commitments during the five-year
period 2004-2008 are estimated to be $46 million.EmployeesAt December 31, 2003 the Health Services segment had approximately 410
full-time employees.OTHER BUSINESS OPERATIONSGeneralOther Business Operations consists of businesses engaged in electrical and
telephone construction contracting, specialty contracting including
design-and-build services for new construction, transportation,
telecommunications, energy services and natural gas marketing as well as the
portion of corporate general and administrative expenses that are not allocated
to the other segments.On November 1, 2003 the Company acquired the assets and operations of
Foley Company.The Company derived 16% of its consolidated operating revenues from these
businesses in 2003 and 13% in 2002 and 14% in 2001. Following is a brief
description of each of these businesses.Foley Company, headquartered in Kansas City, MO, provides mechanical and
prime contracting services including design-and-build services for new
construction, retrofitting, process piping, equipment settings and
instrumentation and control systems. Major clients include water and
wastewater treatment plants, power generation plants, hospital and
pharmaceutical facilities, power generation plants and other industrial
and manufacturing projects across a multi-state service area in the
Central United States.Midwest Construction Services, Inc., located in Moorhead, MN, is a
holding company for five subsidiaries that provide electrical design20Table of Contentsand
construction services for the industrial, commercial and municipal business markets, including government, institutional, communications,
utility and renewable energy projects in the Upper Midwest.Midwest Information Systems, Inc., headquartered in Parkers Prairie, MN,
provides telephone, cable and internet services with over 10,000 access
lines for phone, internet and cable television to homes in rural western
Minnesota communities through its subsidiaries: Midwest Telephone
Company, Osakis Telephone Company, Peoples Telephone Company of Big Fork
and Data Video Systems, Inc.Otter Tail Energy Services Company, headquartered in Fergus Falls, MN,
was established in 1997 to provide unregulated energy-based products and
services to commercial, industrial and institutional clients throughout
the Upper Midwest. During 2003 operations within this company were scaled
back to providing technical and engineering services, energy efficient
lighting, and retail marketing of natural gas and energy management
services to 150 customers in Iowa, South Dakota, North Dakota and
Minnesota.E. W. Wylie Corporation (Wylie), located in Fargo, ND, is a contract and
common carrier operating a fleet of tractors and trailers in 48 states
and 6 Canadian provinces. Wylie has trucking terminals in Fargo, ND, Des
Moines, IA, Fort Worth, TX, and Chicago, IL.RegulationThe telephone subsidiaries are subject to the regulatory authority of the
MPUC regarding rates and charges for telephone services, as well as other
matters. The telephone subsidiaries must keep on file with the MPUC schedules
of such rates and charges, and any requests for changes in such rates and
charges must be filed with the MPUC for approval. The telephone industry is
also subject generally to rules and regulations promulgated by the Federal
Communications Commission. The cable television subsidiary is regulated by
federal and local authorities.CompetitionEach of the businesses in Other Business Operations is subject to
competition, as well as the effects of general economic conditions in their
respective industries. The construction companies in this segment must compete
with other construction companies in the Upper Midwest and the Central regions
of the United States when bidding on new projects. The Company believes the
principal competitive factors in the construction segment are price, quality of
work and customer services.The trucking industry, in which Wylie competes, is highly competitive.
Wylie competes primarily with other short- to medium-haul, flatbed truckload
carriers, internal shipping conducted by existing and potential customers and,
to a lesser extent, railroads. Competition for the freight transported by Wylie
is based primarily on service and efficiency and to a lesser degree, on freight
rates. There are other trucking companies that have greater financial
resources, operate more equipment or carry a larger volume of freight than
Wylie and these companies compete with Wylie for qualified drivers.Capital ExpendituresCapital expenditures in this segment typically include investments in
additional trucks and flat bed trailers, construction equipment and
infrastructure to support the telephone, cable and internet services. During
2003, capital expenditures of approximately $3.2 million were made in Other
Business Operations. Capital expenditures during the five-year period 2004-2008
are estimated to be approximately $16 million for Other Business Operations.
The majority of the capital expenditures in the five-year period 2004-2008 will
be used to replace existing equipment mainly in the telecommunication and
construction companies.21Table of ContentsEmployeesAt December 31, 2003 there were approximately 408 full-time employees in
Other Business Operations. 105 employees of Moorhead Electric, Inc. are
represented by local unions of the International Brotherhood of Electrical
Workers and were covered by a two-year labor contract that expired May 31,
2003. Provisions exist under the labor contract that extended that contract
until May 31, 2004. Moorhead Electric, Inc. has not experienced any strike,
work stoppage or strike vote, and considers its present relations with
employees to be good.Forward Looking Information - Safe Harbor Statement Under the Private
Securities Litigation Reform Act of 1995In connection with the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995 (the Act), the Company has filed cautionary
statements identifying important factors that could cause the Companys actual
results to differ materially from those discussed in
forward-looking statements made by or on behalf of the Company. When used in
this Form 10-K and in future filings by the Company with the Securities and
Exchange Commission, in the Companys press releases and in oral statements,
words such as may, will, expect, anticipate, continue, estimate,
project, believes or similar expressions are intended to identify
forward-looking statements within the meaning of the Act and are included,
along with this statement, for purposes of complying with the safe harbor
provision of the Act. Factors that might cause such differences include, but
are not limited to, the Companys diversification efforts, growth of electric
revenues, the timing and scope of deregulation and open competition, Federal
Energy Regulatory Commission mandated operational changes to the electricity
transmission grid, impact of the investment performance of the Utilitys
pension plan, changes in the economy, weather conditions, market valuation of
forward energy contracts, availability of resin suppliers, resin prices, steel
prices, governmental and regulatory action, fuel and purchased power costs,
environmental issues, and other factors discussed under Critical Accounting
Policies Involving Significant Estimates and Factors Affecting Future
Earnings on pages 24 through 27 of the Companys 2003 Annual Report to
Shareholders, filed as an Exhibit hereto. These factors are in addition to any
other cautionary statements, written or oral, which may be made or referred to
in connection with any such forward-looking statement or contained in any
subsequent filings by the Company with the Securities and Exchange Commission.
Item 2. PROPERTIESThe Coyote Station, which commenced operation in 1981, is a 414,000 kw
(nameplate rating) mine-mouth plant located in the lignite coal fields near
Beulah, North Dakota and is jointly owned by the Utility, Northern Municipal
Power Agency, Montana-Dakota Utilities Co. and Northwestern Public Service
Company. The Utility owns 35% of the plant and on July 1, 1998 became the
operating agent of the Coyote Station.The Utility, jointly with Northwestern Public Service Company and
Montana-Dakota Utilities Co., owns the 414,000 kw (nameplate rating) Big Stone
Plant in northeastern South Dakota which commenced operation in 1975. The
Utility is the operating agent of Big Stone Plant and owns 53.9% of the plant.Located near Fergus Falls, Minnesota, the Hoot Lake Plant is comprised of
three separate generating units with a combined nameplate rating of 127,000 kw.
The oldest Hoot Lake Plant generating unit was constructed in 1948 (7,500 kw
nameplate rating) and a subsequent unit was added in 1959 (53,500 kw nameplate
rating). A third unit was added in 1964 (66,000 kw nameplate rating) and later
modified during 1988 to provide cycling capability, allowing this unit to be
more efficiently brought online from a standby mode.22Table of ContentsAt December 31, 2003 the Utilitys transmission facilities, which are
interconnected with lines of other public utilities, consisted of 48 miles of
345 kv lines; 404 miles of 230 kv lines; 728 miles of 115 kv lines; and 4,108
miles of lower voltage lines, principally 41.6 kv. The Utility owns the uprated
portion of the 48 miles of the 345 kv line, with Minnkota Power Cooperative
retaining title to the original 230 kv construction.In addition to the properties mentioned above, the Company owns and has
investments in offices and service buildings. The Companys subsidiaries own
facilities and equipment used to manufacture PVC pipe and perform metal
stamping, fabricating and contract machining; construction equipment and tools;
medical imaging equipment; a fleet of flatbed trucks and trailers and the
infrastructure to maintain approximately 10,000 access lines for phone,
internet and cable television in its telecommunication companies.Management of the Company believes the facilities and equipment described
above are adequate for the Companys present businesses. In the fall of 2003,
NorthWestern Corporation, which is the owner of Northwestern Public Service
Company, filed for bankruptcy and is in the process of restructuring. The
Company does not currently expect that these events will have a material
adverse affect on the operation of the Coyote Station or the Big Stone Plant.All of the common shares of the companies owned by Varistar are pledged to
secure indebtedness of Varistar.
Item 3. LEGAL PROCEEDINGSNot Applicable.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERSNo matters were submitted to a vote of security holders during the three
months ended December 31, 2003.
Item 4A. EXECUTIVE OFFICERS OF THE REGISTRANT (AS OF MARCH 1, 2004)Set forth below is a summary of the principal occupations and business
experience during the past five years of the executive officers as defined by
rules of the Securities and Exchange Commission. Except as noted below, each of
the executive officers has been employed by the Company for more than five
years in an executive or management position either with the Company or its
wholly owned subsidiary, Varistar.

|                      |  |               |  |                                                                
|--------------------- |  | ------------- |  | ---------------------------------------------------------------
|                      |  | DATES ELECTED |  |                                                                
|NAME AND AGE          |  | TO OFFICE     |  | PRESENT POSITION AND BUSINESS EXPERIENCE                       
|                      |  |               |  |                                                                
|John D. Erickson (45) |  | 4/8/02        |  | Present: President and Chief
Executive Officer                 
|                      |  |               |  |                                                                
|                      |  | 4/9/01        |  | President                                                      
|                      |  |               |  |                                                                
|                      |  | 4/10/00       |  | Executive Vice President, Chief
Financial Officer and
Treasurer
|                      |  |               |  |                                                                
|                      |  | Prior to      |  |                                                                
|                      |  | 4/10/00       |  | Vice President, Finance and
Chief Financial Officer            

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|                           |  |                 |  |                                                                                                   
|-------------------------- |  | --------------- |  | --------------------------------------------------------------------------------------------------
|                           |  | DATES ELECTED   |  |                                                                                                   
|NAME AND AGE               |  | TO OFFICE       |  | PRESENT POSITION AND BUSINESS EXPERIENCE                                                          
|                           |  |                 |  |                                                                                                   
|George A. Koeck (51)       |  | 4/10/00         |  | Present: Corporate Secretary
and General Counsel                                                  
|                           |  |                 |  |                                                                                                   
|                           |  | 8/2/99          |  | General Counsel                                                                                   
|                           |  |                 |  |                                                                                                   
|                           |  | Prior to
8/2/99 |  | Partner, Dorsey & Whitney LLP                                                                     
|                           |  |                 |  |                                                                                                   
|Lauris N. Molbert (46)     |  | 6/10/02         |  | Present: Executive Vice President and
Chief Operating Officer                                     
|                           |  |                 |  |                                                                                                   
|                           |  | 4/9/01          |  | Executive Vice President,
Corporate Development and
Varistar President and Chief
Operating Officer
|                           |  |                 |  |                                                                                                   
|                           |  | 4/10/00         |  | Vice President, Chief Operating Officer,
Varistar; President and Chief
Operating Officer, Varistar
|                           |  |                 |  |                                                                                                   
|                           |  | Prior to        |  |                                                                                                   
|                           |  | 4/10/00         |  | President and Chief Operating Officer,
Varistar                                                   
|                           |  |                 |  |                                                                                                   
|Kevin G. Moug (44)         |  | 4/9/01          |  | Present: Chief Financial Officer and
Treasurer                                                    
|                           |  |                 |  |                                                                                                   
|                           |  | Prior to        |  |                                                                                                   
|                           |  | 4/9/01          |  | Varistar Chief Financial Officer and
Treasurer                                                    
|                           |  |                 |  |                                                                                                   
|Charles S. MacFarlane (39) |  | 5/1/03          |  | President, Otter Tail Power Company                                                               
|                           |  |                 |  |                                                                                                   
|                           |  | 6/1/02          |  | Interim President, Otter Tail Power Company                                                       
|                           |  |                 |  |                                                                                                   
|                           |  | 1/29/02         |  | Director, Finance & Strategic Planning
Otter Tail Power Company                                   
|                           |  |                 |  |                                                                                                   
|                           |  | 12/1/01         |  | Director, Finance Planning
Otter Tail Power Company                                               
|                           |  |                 |  |                                                                                                   
|                           |  | Prior to        |  |                                                                                                   
|                           |  | 12/2/01         |  | Director, Electric Distribution
Planning, Engineering &
Reliability, Xcel Energy                  

With the exception of Charles S. MacFarlane, the term of office for each
of the executive officers is one year and any executive officer elected may be
removed by the vote of the Board of Directors at any time during the term. Mr.
MacFarlane is not appointed by the Board of Directors. Mr. MacFarlane is a son
of John MacFarlane, who is the Chairman of the Board of Directors. There are no
other family relationships between any of the executive officers.

24



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##### Table of Contents






PART II




Item 5. MARKET FOR THE REGISTRANTS COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The information required by this Item is incorporated by reference to the
first sentence under Otter Tail Corporation Stock Listing on Page 53, to
Selected Consolidated Financial Data on Page 17 and to Quarterly
Information on Page 49 of the Companys 2003 Annual Report to Shareholders,
filed as an Exhibit hereto.




Item 6. SELECTED FINANCIAL DATA

The information required by this Item is incorporated by reference to
Selected Consolidated Financial Data on Page 17 of the Companys 2003 Annual
Report to Shareholders, filed as an Exhibit hereto.




Item 7. MANAGEMENTS
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The information required by this Item is incorporated by reference to
Managements Discussion and Analysis of Financial Condition and Results of
Operations on Pages 18 through 30 of the Companys 2003 Annual Report to
Shareholders, excluding Report of Management and Independent Auditors
Report on Page 30, filed as an Exhibit hereto.




Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The information required by this Item is incorporated by reference to
Quantitative and Qualitative Disclosures About Market Risk on Pages 28 and 29
of the Companys 2003 Annual Report to Shareholders, filed as an Exhibit
hereto.




Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The information required by this Item is incorporated by reference to
Quarterly Information on Page 49, the Companys audited financial statements
on Pages 31 through 49 and Independent Auditors Report on page 30 of the
Companys 2003 Annual Report to Shareholders, filed as an Exhibit hereto.




Item 9. CHANGES IN AND
DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.




Item 9A. CONTROLS AND PROCEDURES

Under the supervision and with the participation of the Companys
management, including the Chief Executive Officer and the Chief Financial
Officer, the Company evaluated the effectiveness of the design and operation of
its disclosure controls and procedures (as defined in Rule 13a-15(e) under the
Securities Exchange Act of 1934) as of December 31, 2003, the end of the period
covered by this report. Based on that evaluation, the Chief Executive Officer
and Chief Financial Officer concluded that the Companys disclosure controls
and procedures were effective as of December 31, 2003.

During the fiscal quarter ended December 31, 2003 there were no changes in
the Companys internal controls over financial reporting (as defined in Rule
13a-15(f) under the Exchange Act) that has materially affected, or is
reasonably likely to materially affect, the Companys internal controls over
financial reporting.

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##### Table of Contents






PART III




Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The information required by this Item regarding Directors is incorporated
by reference to the information under Election of Directors in the Companys
definitive Proxy Statement dated March 17, 2004. The information regarding
executive officers is set forth in Item 4A hereto. The information regarding
Section 16 reporting is incorporated by reference to the information under
Section 16(a) Beneficial Ownership Reporting Compliance in the Companys
definitive Proxy Statement dated March 17, 2004. The information regarding
Audit Committee financial experts and identification of the Audit Committee is
incorporated by reference to the information under Meetings and Committees of
the Board - Audit Committee in the Companys definitive Proxy Statement dated
March 17, 2004.

The Company has adopted a code of conduct that applies to all of its
directors, officers (including its principal executive officer, principal
financial officer, principal accounting officer or controller or person
performing similar functions) and employees. The Companys code of conduct is
available on its website at www.ottertail.com. The Company intends to satisfy
the disclosure requirements under Item 10 of Form 8-K regarding an amendment
to, or waiver from, a provision of its code of conduct by posting such
information on its website at the address specified above. Information on the
Companys website is not deemed to be incorporated by reference into this
Annual Report on Form 10-K.

The information regarding shareholder nominating procedures is
incorporated by reference to the information under Meetings and Committees of
the Board - Corporate Governance Committee in the Companys definitive Proxy
Statement dated March 17, 2004.




Item 11. EXECUTIVE COMPENSATION

The information required by this Item is incorporated by reference to the
information under Summary Compensation Table, Options/SAR Grants in Last
Fiscal Year, Aggregated Option/SAR Exercises in Last Fiscal Year and Fiscal
Year-End Options/SAR Values, Pension and Supplemental Retirement Plans,
Severance and Employment Agreements, and Director Compensation in the
Companys definitive Proxy Statement dated March 17, 2004.




Item 12. SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The security ownership information set forth under Outstanding Voting
Shares and Managements Security Ownership in the Companys definitive Proxy
Statement dated March 17, 2004 is incorporated herein by reference.

26



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##### Table of Contents



EQUITY COMPENSATION PLAN INFORMATION

The following table sets forth information as of December 31, 2003 about
the Companys common stock that may be issued under all of its equity
compensation plans:

|                                                           |                                   |            |                   |            |                   |      |                     |       |                     |  |                     |         |    
|---------------------------------------------------------- | --------------------------------- | ---------- | ----------------- | ---------- | ----------------- | ---- | ------------------- | ----- | ------------------- |  | ------------------- | ------- | ---
|                                                           |                                   |            |                   |            |                   |      |                     |       |                     |  | Number of          
|                                                           |                                   |            |                   |            |                   |      |                     |       |                     |  | securities         
|                                                           |                                   |            |                   |            |                   |      |                     |       |                     |  | remaining available
|                                                           |                                   |            | Number of         |            |                   |      |                     |       | for future issuance
|                                                           |                                   |            | securities to be  |            |                   |      |                     |       | under equity       
|                                                           |                                   |            | issued upon       |            | Weighted-average  |      | compensation plans 
|                                                           |                                   |            | exercise of       |            | exercise price of |      | (excluding         
|                                                           |                                   |            | outstanding       |            | outstanding       |      | securities         
|                                                           |                                   |            | options, warrants |            | options, warrants |      | reflected in column
|Plan Category                                              |                                   | and rights |                   | and rights |                   | (a))
|                                                           |                                   |            |                   |            |                   |     
|                                                           |                                   |            | (a)               |            | (b)               |      | (c)                
|Equity compensation
plans approved by
security holders     |                                   |            |                   |            |                   |      |                     |       |                     |  |                     |        
|                                                           | 1999 Stock
Incentive Plan         |            |                   | 1,531,125  |                   |      | $                   | 25.16 |                     |  |                     | 621,598 | (1)
|                                                           | 1999 Employee
Stock Purchase Plan |            |                   |           |                   |      |                     | N/A   |                     |  |                     | 165,037 | (2)
|Equity compensation
plans not approved
by security holders |                                   |            |                  |            |                   |      |                    |       |                     |  |                    |        
|                                                           |                                   |            |                   |            |                   |      |                     |       |                     |  |                     |         |    
|Total                                                      |                                   |            | 1,531,125         |            |                   | $    | 25.16               |       |                     |  | 786,635             |        
|                                                           |                                   |            |                   |            |                   |      |                     |       |                     |  |                     |         |    



---

|(1) |  | The 1999 Stock Incentive Plan provides for the issuance of any shares
available under the plan in the form of restricted stock, performance
awards and other types of stock-based awards, in addition to the granting
of options, warrants or stock appreciation rights.
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Shares are issued based on employees election to participate in the
plan.                                                                                                                                                                                              




Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

None.




Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this Item is incorporated by reference to the
information under Approval of Auditors in the Companys definitive Proxy
Statement dated March 17, 2004.




PART IV




Item 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a)  List of documents filed:

(1) and (2) See Table of Contents on Page 29 hereof.

(3) See Exhibit Index on Pages 30 through 36 hereof.



| |                                                                                                                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Pursuant to Item 601(b)(4)(iii) of Regulation S-K, copies of
certain instruments defining the rights of holders of certain
long-term debt of the Company are not filed, and in lieu
thereof, the Company agrees to furnish copies thereof to the
Securities and Exchange Commission upon request.

(b)  Reports on Form 8-K:



| |                                                                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Company filed a Form 8-K on November 5, 2003 to furnish
under Item 12 the press release issued on November 3, 2003 to
report its earnings for the third quarter of 2003.

27



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##### Table of Contents






SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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
|                      |  | By                     |  | /s/ Kevin G. Moug                                  
|                      |  |                        |  | Kevin G. Moug
Chief Financial Officer
and Treasurer
|Dated: March 12, 2004 |  |                        |  |                                                    

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated:

|                                             |  |     |    |                            
|-------------------------------------------- |  | --- | -- | ---------------------------
|Signature and Title                          |  |     |    |                            
|                                             |  |    
|John D. Erickson                             |  | )   |    |                            
|President and                                |  | )   |    |                            
|Chief Executive Officer                      |  | )   |    |                            
|(principal executive officer)                |  | )   |    |                            
|                                             |  | )   |    |                            
|Kevin G. Moug                                |  | )   |    |                            
|Chief Financial Officer and Treasurer        |  | )   |    |                            
|(principal financial and accounting officer) |  | )   |    |                            
|                                             |  | )   | By | /s/ John D. Erickson       
|                                             |  | )   |    |                            
|John C. MacFarlane                           |  | )   |    | John D. Erickson           
|Chairman of the Board and Director           |  | )   |    | Pro Se and Attorney-in-Fact
|                                             |  | )   |    | Dated March 12, 2004       
|Karen M. Bohn, Director                      |  | )   |    |                            
|                                             |  | )   |    |                            
|Thomas M. Brown, Director                    |  | )   |    |                            
|                                             |  | )   |    |                            
|Dennis R. Emmen, Director                    |  | )   |    |                            
|                                             |  | )   |    |                            
|Arvid R. Liebe, Director                     |  | )   |    |                            
|                                             |  | )   |    |                            
|Kenneth L. Nelson, Director                  |  | )   |    |                            
|Nathan I. Partain, Director                  |  | )
) |    |                            
|                                             |  | )   |    |                            
|Gary J. Spies, Director                      |  | )   |    |                            
|                                             |  | )   |    |                            
|Robert N. Spolum, Director                   |  | )   |    |                            

28



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##### Table of Contents



OTTER TAIL CORPORATION

TABLE OF CONTENTS

FINANCIAL STATEMENTS, SUPPLEMENTARY FINANCIAL DATA, SUPPLEMENTAL FINANCIAL
SCHEDULES INCLUDED IN ANNUAL REPORT (FORM 10-K) FOR THE YEAR ENDED
DECEMBER 31, 2003

The following items are included in this annual report by reference to the
registrants Annual Report to Shareholders for the year ended December 31,
2003:

|                                                                                |                                                                                                    |  |              |         | 
|------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------- |  | ------------ | ------- | 
|                                                                                |                                                                                                    |  | Page in     
|                                                                                |                                                                                                    |  | Annual      
|                                                                                |                                                                                                    |  | Report to   
|                                                                                |                                                                                                    |  | Shareholders
|                                                                                |                                                                                                    |  |             
|Financial Statements:                                                           |                                                                                                    |  |              |        
|                                                                                | Independent Auditors Report                                                                       |  |              | 30      | 
|                                                                                | Consolidated Statements of Income for the Three Years
Ended December 31, 2003                      |  |              | 31      | 
|                                                                                | Consolidated Balance Sheets, December 31, 2003 and 2002                                            |  |              | 32 & 33 | 
|                                                                                | Consolidated Statements of Common Shareholders Equity for the
Three Years Ended December 31, 2003 |  |              | 34      | 
|                                                                                | Consolidated Statements of Cash Flows for the Three Years
Ended December 31, 2003                  |  |              | 35      | 
|                                                                                | Consolidated Statements of Capitalization, December 31, 2003
and 2002                              |  |              | 36      | 
|                                                                                | Notes to Consolidated Financial Statements                                                         |  |              | 37-49   | 
|Selected Consolidated Financial Data for the Five Years
Ended December 31, 2003 |                                                                                                    |  | 17           |        
|Quarterly Data for the Two Years Ended
December 31, 2003                        |                                                                                                    |  | 49           |        

Schedules are omitted because of the absence of the conditions under which they
are required, because the amounts are insignificant or because the information
required is included in the financial statements or the notes thereto.

29



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##### Table of Contents



Exhibit Index
to
Annual Report
on Form 10-K
For Year Ended December 31, 2003

|      |  |                  |  |         |        |  |  |                                        
|----- |  | ---------------- |  | ------- | ------ |  |  | ---------------------------------------
|      |  | Previously Filed |  |        
|      |  |                  |  |        
|      |  |                  |  | As      |        | 
|      |  |                  |  | Exhibit |        | 
|      |  | File No.         |  | No.     |        | 
|      |  |                  |  |         |        | 
|3-A   |  | 8-K              |  |         | 3      |  |  | Restated Articles of                  
|      |  | dated 4/10/01    |  |         |        |  |  | Incorporation, as amended              
|      |  |                  |  |         |        |  |  | (including resolutions                 
|      |  |                  |  |         |        |  |  | creating outstanding series            
|      |  |                  |  |         |        |  |  | of Cumulative Preferred Shares).       
|      |  |                  |  |         |        |  |  |                                        
|3-C   |  | 33-46071         |  |         | 4-B    |  |  | Bylaws as amended through             
|      |  |                  |  |         |        |  |  | April 11, 1988.                        
|      |  |                  |  |         |        |  |  |                                        
|4-D-1 |  | 8-A dated        |  |         | 1      |  |  | Rights Agreement, dated as of         
|      |  | 1/28/97          |  |         |        |  |  | January 28, 1997 (the Rights           
|      |  |                  |  |         |        |  |  | Agreement), between the                
|      |  |                  |  |         |        |  |  | Company and Norwest Bank Minnesota,    
|      |  |                  |  |         |        |  |  | National Association.                  
|      |  |                  |  |         |        |  |  |                                        
|4-D-2 |  | 8-A/A dated      |  |         | 1      |  |  | Amendment No. 1, dated as of          
|      |  | 9/29/98          |  |         |        |  |  | August 24, 1998, to the Rights         
|      |  |                  |  |         |        |  |  | Agreement.                             
|      |  |                  |  |         |        |  |  |                                        
|4-D-3 |  | 10-K for year    |  |         | 4-D-7  |  |  | Note Purchase Agreement dated         
|      |  | ended 12/31/01   |  |         |        |  |  | as of December 1, 2001.                
|      |  |                  |  |         |        |  |  |                                        
|4-D-4 |  | 10-K for year    |  |         | 4-D-4  |  |  | First Amendment dated as of           
|      |  | ended 12/31/02   |  |         |        |  |  | December 1, 2002 to Note Purchase      
|      |  |                  |  |         |        |  |  | Agreement dated as of December 1, 2001.
|      |  |                  |  |         |        |  |  |                                        
|4-D-5 |  | 333-90952        |  |         | 99-A-1 |  |  | Credit Agreement dated as of          
|      |  |                  |  |         |        |  |  | April 30, 2002.                        
|      |  |                  |  |         |        |  |  |                                        
|4-D-6 |  | 8-K dated        |  |         | 99-A   |  |  | First Amendment dated as of           
|      |  | 9/27/02          |  |         |        |  |  | September 19, 2002 to Credit           
|      |  |                  |  |         |        |  |  | Agreement dated as of April 30, 2002.  
|      |  |                  |  |         |        |  |  |                                        
|4-D-7 |  | 10-Q for quarter |  |         | 4-A    |  |  | Second Amendment dated as of          
|      |  | ended 6/30/03    |  |         |        |  |  | April 29, 2003 to Credit               
|      |  |                  |  |         |        |  |  | Agreement dated as of April 30, 2002.  
|      |  |                  |  |         |        |  |  |                                        
|4-D-8 |  | 10-Q for quarter |  |         | 4.1    |  |  | Third Amendment dated as of           
|      |  | ended 9/30/03    |  |         |        |  |  | August 25, 2003 to Credit              
|      |  |                  |  |         |        |  |  | Agreement dated as of April 30, 2002.  
|      |  |                  |  |         |        |  |  |                                        
|10-A  |  | 2-39794          |  |         | 4-C    |  |  | Integrated Transmission               
|      |  |                  |  |         |        |  |  | Agreement dated August 25,             
|      |  |                  |  |         |        |  |  | 1967, between Cooperative              
|      |  |                  |  |         |        |  |  | Power Association and the              
|      |  |                  |  |         |        |  |  | Company.                               

-30-



---



##### Table of Contents



|       |  |                  |  |         |        |  |  |                                    
|------ |  | ---------------- |  | ------- | ------ |  |  | -----------------------------------
|       |  | Previously Filed |  |        
|       |  |                  |  |        
|       |  |                  |  | As      |        | 
|       |  |                  |  | Exhibit |        | 
|       |  | File No.         |  | No.     |        | 
|       |  |                  |  |         |        | 
|10-A-1 |  | 10-K for year    |  |         | 10-A-1 |  |  | Amendment No. 1, dated as         
|       |  | ended 12/31/92   |  |         |        |  |  | of September 6, 1979, to           
|       |  |                  |  |         |        |  |  | Integrated Transmission            
|       |  |                  |  |         |        |  |  | Agreement, dated as of             
|       |  |                  |  |         |        |  |  | August 25, 1967, between           
|       |  |                  |  |         |        |  |  | Cooperative Power Association      
|       |  |                  |  |         |        |  |  | and the Company.                   
|       |  |                  |  |         |        |  |  |                                    
|10-A-2 |  | 10-K for year    |  |         | 10-A-2 |  |  | Amendment No. 2, dated as of      
|       |  | ended 12/31/92   |  |         |        |  |  | November 19, 1986, to Integrated   
|       |  |                  |  |         |        |  |  | Transmission Agreement between     
|       |  |                  |  |         |        |  |  | Cooperative Power Association      
|       |  |                  |  |         |        |  |  | and the Company.                   
|       |  |                  |  |         |        |  |  |                                    
|10-C-1 |  | 2-55813          |  |         | 5-E    |  |  | Contract dated July 1, 1958,      
|       |  |                  |  |         |        |  |  | between Central Power Electric     
|       |  |                  |  |         |        |  |  | Corporation, Inc., and the Company.
|       |  |                  |  |         |        |  |  |                                    
|10-C-2 |  | 2-55813          |  |         | 5-E-1  |  |  | Supplement Seven dated            
|       |  |                  |  |         |        |  |  | November 21, 1973.                 
|       |  |                  |  |         |        |  |  | (Supplements Nos. One through      
|       |  |                  |  |         |        |  |  | Six have been superseded           
|       |  |                  |  |         |        |  |  | and are no longer in effect.)      
|       |  |                  |  |         |        |  |  |                                    
|10-C-3 |  | 2-55813          |  |         | 5-E-2  |  |  | Amendment No. 1 dated             
|       |  |                  |  |         |        |  |  | December 19, 1973, to              
|       |  |                  |  |         |        |  |  | Supplement Seven.                  
|       |  |                  |  |         |        |  |  |                                    
|10-C-4 |  | 10-K for year    |  |         | 10-C-4 |  |  | Amendment No. 2 dated             
|       |  | ended 12/31/91   |  |         |        |  |  | June 17, 1986, to Supplement       
|       |  |                  |  |         |        |  |  | Seven.                             
|       |  |                  |  |         |        |  |  |                                    
|10-C-5 |  | 10-K for year    |  |         | 10-C-5 |  |  | Amendment No. 3 dated             
|       |  | ended 12/31/92   |  |         |        |  |  | June 18, 1992, to Supplement       
|       |  |                  |  |         |        |  |  | Seven.                             
|       |  |                  |  |         |        |  |  |                                    
|10-C-6 |  | 10-K for year    |  |         | 10-C-6 |  |  | Amendment No. 4 dated             
|       |  | ended 12/31/93   |  |         |        |  |  | January 18, 1994, to Supplement    
|       |  |                  |  |         |        |  |  | Seven.                             
|       |  |                  |  |         |        |  |  |                                    
|10-D   |  | 2-55813          |  |         | 5-F    |  |  | Contract dated April 12,          
|       |  |                  |  |         |        |  |  | 1973, between the Bureau of        
|       |  |                  |  |         |        |  |  | Reclamation and the Company.       
|       |  |                  |  |         |        |  |  |                                    
|10-E-1 |  | 2-55813          |  |         | 5-G    |  |  | Contract dated January 8,         
|       |  |                  |  |         |        |  |  | 1973, between East River           
|       |  |                  |  |         |        |  |  | Electric Power Cooperative         
|       |  |                  |  |         |        |  |  | and the Company.                   
|       |  |                  |  |         |        |  |  |                                    
|10-E-2 |  | 2-62815          |  |         | 5-E-1  |  |  | Supplement One dated              
|       |  |                  |  |         |        |  |  | February 20, 1978.                 
|       |  |                  |  |         |        |  |  |                                    
|10-E-3 |  | 10-K for year    |  |         | 10-E-3 |  |  | Supplement Two dated              
|       |  | ended 12/31/89   |  |         |        |  |  | June 10, 1983.                     
|       |  |                  |  |         |        |  |  |                                    
|10-E-4 |  | 10-K for year    |  |         | 10-E-4 |  |  | Supplement Three dated            
|       |  | ended 12/31/90   |  |         |        |  |  | June 6, 1985.                      

-31-



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##### Table of Contents



|       |  |                  |  |         |        |  |  |                                                                                                                                                 
|------ |  | ---------------- |  | ------- | ------ |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------
|       |  | Previously Filed |  |        
|       |  |                  |  |        
|       |  |                  |  | As      |        | 
|       |  |                  |  | Exhibit |        | 
|       |  | File No.         |  | No.     |        | 
|       |  |                  |  |         |        | 
|10-E-5 |  | 10-K for year    |  |         | 10-E-5 |  |  | Supplement No. Four, dated                                                                                                                     
|       |  | ended 12/31/92   |  |         |        |  |  | as of September 10, 1986.                                                                                                                       
|       |  |                  |  |         |        |  |  |                                                                                                                                                 
|10-E-6 |  | 10-K for year    |  |         | 10-E-6 |  |  | Supplement No. Five, dated                                                                                                                     
|       |  | ended 12/31/92   |  |         |        |  |  | as of January 7, 1993.                                                                                                                          
|       |  |                  |  |         |        |  |  |                                                                                                                                                 
|10-E-7 |  | 10-K for year    |  |         | 10-E-7 |  |  | Supplement No. Six, dated                                                                                                                      
|       |  | ended 12/31/93   |  |         |        |  |  | as of December 2, 1993.                                                                                                                         
|       |  |                  |  |         |        |  |  |                                                                                                                                                 
|10-F   |  | 10-K for year    |  |         | 10-F   |  |  | Agreement for Sharing                                                                                                                          
|       |  | ended 12/31/89   |  |         |        |  |  | Ownership of Generating                                                                                                                         
|       |  |                  |  |         |        |  |  | Plant by and between the                                                                                                                        
|       |  |                  |  |         |        |  |  | Company, Montana-Dakota                                                                                                                         
|       |  |                  |  |         |        |  |  | Utilities Co., and North-                                                                                                                       
|       |  |                  |  |         |        |  |  | western Public Service                                                                                                                          
|       |  |                  |  |         |        |  |  | Company (dated as of                                                                                                                            
|       |  |                  |  |         |        |  |  | January 7, 1970).                                                                                                                               
|       |  |                  |  |         |        |  |  |                                                                                                                                                 
|10-F-1 |  | 10-K for year    |  |         | 10-F-1 |  |  | Letter of Intent for pur-                                                                                                                      
|       |  | ended 12/31/89   |  |         |        |  |  | chase of share of Big Stone                                                                                                                     
|       |  |                  |  |         |        |  |  | Plant from Northwestern                                                                                                                         
|       |  |                  |  |         |        |  |  | Public Service Company                                                                                                                          
|       |  |                  |  |         |        |  |  | (dated as of May 8, 1984).                                                                                                                      
|       |  |                  |  |         |        |  |  |                                                                                                                                                 
|10-F-2 |  | 10-K for year    |  |         | 10-F-2 |  |  | Supplemental Agreement No. 1                                                                                                                   
|       |  | ended 12/31/91   |  |         |        |  |  | to Agreement for Sharing                                                                                                                        
|       |  |                  |  |         |        |  |  | Ownership of Big Stone Plant                                                                                                                    
|       |  |                  |  |         |        |  |  | (dated as of July 1, 1983).                                                                                                                     
|       |  |                  |  |         |        |  |  |                                                                                                                                                 
|10-F-3 |  | 10-K for year    |  |         | 10-F-3 |  |  | Supplemental Agreement No. 2                                                                                                                   
|       |  | ended 12/31/91   |  |         |        |  |  | to Agreement for Sharing
Ownership of Big Stone Plant
(dated as of March 1, 1985).                                                              
|       |  |                  |  |         |        |  |  |                                                                                                                                                 
|10-F-4 |  | 10-K for year    |  |         | 10-F-4 |  |  | Supplemental Agreement No. 3                                                                                                                   
|       |  | ended 12/31/91   |  |         |        |  |  | to Agreement for Sharing
Ownership of Big Stone Plant
(dated as of March 31, 1986).                                                             
|       |  |                  |  |         |        |  |  |                                                                                                                                                 
|10-F-5 |  | 10-Q for quarter |  |         | 10.1   |  |  | Supplemental Agreement No. 4                                                                                                                   
|       |  | ended 9/30/03    |  |         |        |  |  | to Agreement for Sharing
Ownership of Big Stone Plant
(dated as of April 24, 2003).                                                             
|       |  |                  |  |         |        |  |  |                                                                                                                                                 
|10-F-6 |  | 10-K for year    |  |         | 10-F-5 |  |  | Amendment I to Letter of                                                                                                                       
|       |  | ended 12/31/92   |  |         |        |  |  | Intent dated May 8, 1984, for
purchase of share of Big Stone
Plant.                                                                             
|       |  |                  |  |         |        |  |  |                                                                                                                                                 
|10-G   |  | 10-Q for quarter |  |         | 10-B   |  |  | Big Stone Plant Coal Agreements                                                                                                                
|       |  | ended 09/30/01   |  |         |        |  |  | by and between the Company, Northwestern
Public Service, Montana-Dakota
Utilities Co., and RAG Coal West, Inc.
(dated as of September 28, 2001).

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##### Table of Contents



|       |  |                  |  |         |        |  |  |                                                                                                                                                                                                                                                                  
|------ |  | ---------------- |  | ------- | ------ |  |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |  | Previously Filed |  |        
|       |  |                  |  |        
|       |  |                  |  | As      |        | 
|       |  |                  |  | Exhibit |        | 
|       |  | File No.         |  | No.     |        | 
|       |  |                  |  |         |        | 
|10-H   |  | 2-61043          |  |         | 5-H    |  |  | Agreement for Sharing Owner-                                                                                                                                                                                                                                    
|       |  |                  |  |         |        |  |  | ship of Coyote Station
Generating Unit No. 1 by and
between the Company, Minnkota
Power Cooperative, Inc.,
Montana-Dakota Utilities Co.,
Northwestern Public Service
Company, and Minnesota Power
& Light Company (dated as of
July 1, 1977).                    
|       |  |                  |  |         |        |  |  |                                                                                                                                                                                                                                                                  
|10-H-1 |  | 10-K for year    |  |         | 10-H-1 |  |  | Supplemental Agreement No.                                                                                                                                                                                                                                      
|       |  | ended 12/31/89   |  |         |        |  |  | One dated as of November 30,
1978, to Agreement for Sharing
Ownership of Coyote Generating
Unit No. 1.                                                                                                                                                           
|       |  |                  |  |         |        |  |  |                                                                                                                                                                                                                                                                  
|10-H-2 |  | 10-K for year    |  |         | 10-H-2 |  |  | Supplemental Agreement No.                                                                                                                                                                                                                                      
|       |  | ended 12/31/89   |  |         |        |  |  | Two dated as of March 1, 1981,
to Agreement for Sharing
Ownership of Coyote Generating
Unit No. 1 and Amendment No. 2
dated March 1, 1981, to Coyote
Plant Coal Agreement.                                                                                       
|       |  |                  |  |         |        |  |  |                                                                                                                                                                                                                                                                  
|10-H-3 |  | 10-K for year    |  |         | 10-H-3 |  |  | Amendment dated as of                                                                                                                                                                                                                                           
|       |  | ended 12/31/89   |  |         |        |  |  | July 29, 1983, to Agreement
for Sharing Ownership of
Coyote Generating Unit No. 1.                                                                                                                                                                               
|       |  |                  |  |         |        |  |  |                                                                                                                                                                                                                                                                  
|10-H-4 |  | 10-K for year    |  |         | 10-H-4 |  |  | Agreement dated as of Sept.                                                                                                                                                                                                                                     
|       |  | ended 12/31/92   |  |         |        |  |  | 5, 1985, containing Amendment
No. 3 to Agreement for Sharing
Ownership of Coyote Generating
Unit No.1, dated as of July 1,
1977, and Amendment No. 5 to
Coyote Plant Coal Agreement,
dated as of January 1, 1978.                                                
|       |  |                  |  |         |        |  |  |                                                                                                                                                                                                                                                                  
|10-H-5 |  | 10-Q for quarter |  |         | 10-A   |  |  | Amendment dated as of                                                                                                                                                                                                                                           
|       |  | ended 9/30/01    |  |         |        |  |  | June 14, 2001, to Agreement for
Sharing Ownership of
Coyote Generating Unit No. 1.                                                                                                                                                                               
|       |  |                  |  |         |        |  |  |                                                                                                                                                                                                                                                                  
|10-H-6 |  | 10-Q for quarter |  |         | 10.2   |  |  | Amendment dated as of                                                                                                                                                                                                                                           
|       |  | ended 9/30/03    |  |         |        |  |  | April 24, 2003, to Agreement for
Sharing Ownership of
Coyote Generating Unit No. 1.                                                                                                                                                                              
|       |  |                  |  |         |        |  |  |                                                                                                                                                                                                                                                                  
|10-I   |  | 2-63744          |  |         | 5-I    |  |  | Coyote Plant Coal Agreement
by and between the Company,
Minnkota Power Cooperative,
Inc., Montana-Dakota
Utilities Co., Northwestern
Public Service Company,
Minnesota Power & Light
Company, and Knife River
Coal Mining Company (dated
as of January 1, 1978).

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##### Table of Contents



|       |  |                  |  |         |        |  |  |                                                                                                                                                       
|------ |  | ---------------- |  | ------- | ------ |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------
|       |  | Previously Filed |  |        
|       |  |                  |  |        
|       |  |                  |  | As      |        | 
|       |  |                  |  | Exhibit |        | 
|       |  | File No.         |  | No.     |        | 
|       |  |                  |  |         |        | 
|10-I-1 |  | 10-K for year    |  |         | 10-I-1 |  |  | Addendum, dated as of March                                                                                                                          
|       |  | ended 12/31/92   |  |         |        |  |  | 10, 1980, to Coyote Plant
Coal Agreement.                                                                                                             
|       |  |                  |  |         |        |  |  |                                                                                                                                                       
|10-I-2 |  | 10-K for year    |  |         | 10-I-2 |  |  | Amendment (No. 3), dated as                                                                                                                          
|       |  | ended 12/31/92   |  |         |        |  |  | of May 28, 1980, to Coyote
Plant Coal Agreement.                                                                                                      
|       |  |                  |  |         |        |  |  |                                                                                                                                                       
|10-I-3 |  | 10-K for year    |  |         | 10-I-3 |  |  | Fourth Amendment, dated as                                                                                                                           
|       |  | ended 12/31/92   |  |         |        |  |  | of August 19, 1985, to
Coyote Plant Coal Agreement.                                                                                                   
|       |  |                  |  |         |        |  |  |                                                                                                                                                       
|10-I-4 |  | 10-Q for quarter |  |         | 19-A   |  |  | Sixth Amendment, dated as of                                                                                                                         
|       |  | ended 6/30/93    |  |         |        |  |  | February 17, 1993, to Coyote
Plant Coal Agreement.                                                                                                    
|       |  |                  |  |         |        |  |  |                                                                                                                                                       
|10-I-5 |  | 10-K for year    |  |         | 10-I-5 |  |  | Agreement and Consent to                                                                                                                             
|       |  | ended 12/31/01   |  |         |        |  |  | Assignment of the Coyote Plant
Coal Agreement.                                                                                                        
|       |  |                  |  |         |        |  |  |                                                                                                                                                       
|10-K   |  | 10-K for year    |  |         | 10-K   |  |  | Diversity Exchange Agreement                                                                                                                         
|       |  | ended 12/31/91   |  |         |        |  |  | by and between the Company
and Northern States Power
Company, (dated as of May 21,
1985) and amendment thereto
(dated as of August 12, 1985).         
|       |  |                  |  |         |        |  |  |                                                                                                                                                       
|10-K-1 |  | 10-Q for quarter |  |         | 10     |  |  | Power Sales Agreement                                                                                                                                
|       |  | ended 9/30/99    |  |         |        |  |  | between the Company and
Manitoba Hydro Electric Board
(dated as of July 1, 1999).                                                                     
|       |  |                  |  |         |        |  |  |                                                                                                                                                       
|10-L   |  | 10-K for year    |  |         | 10-L   |  |  | Integrated Transmission                                                                                                                              
|       |  | ended 12/31/91   |  |         |        |  |  | Agreement by and between the
Company, Missouri Basin
Municipal Power Agency and
Western Minnesota Municipal
Power Agency (dated as of
March 31, 1986).
|       |  |                  |  |         |        |  |  |                                                                                                                                                       
|10-L-1 |  | 10-K for year    |  |         | 10-L-1 |  |  | Amendment No. 1, dated as                                                                                                                            
|       |  | ended 12/31/88   |  |         |        |  |  | of December 28, 1988, to
Integrated Transmission
Agreement (dated as of
March 31, 1986).                                                              
|       |  |                  |  |         |        |  |  |                                                                                                                                                       
|10-M   |  | 10-K for year    |  |         | 10-M   |  |  | Hoot Lake Coal Transportation                                                                                                                        
|       |  | ended 12/31/99   |  |         |        |  |  | Agreement by and between the
Company and The Burlington
Northern and Santa Fe Railway
Company (dated as of July 19, 1999).                            
|       |  |                  |  |         |        |  |  |                                                                                                                                                       
|10-N-1 |  | 10-K for year    |  |         | 10-N-1 |  |  | Deferred Compensation Plan                                                                                                                           
|       |  | ended 12/31/02   |  |         |        |  |  | for Directors, as amended.*                                                                                                                           
|       |  |                  |  |         |        |  |  |                                                                                                                                                       
|10-N-2 |  | 10-Q for quarter |  |         | 10-C   |  |  | Executive Survivor and                                                                                                                               
|       |  | ended 3/31/02    |  |         |        |  |  | Supplemental Retirement Plan,
as amended.*                                                                                                            

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##### Table of Contents



|       |  |                  |  |         |        |  |  |                                                                                                     
|------ |  | ---------------- |  | ------- | ------ |  |  | ----------------------------------------------------------------------------------------------------
|       |  | Previously Filed |  |        
|       |  |                  |  |        
|       |  |                  |  | As      |        | 
|       |  |                  |  | Exhibit |        | 
|       |  | File No.         |  | No.     |        | 
|       |  |                  |  |         |        | 
|10-N-3 |  | 10-K for year    |  |         | 10-N-5 |  |  | Nonqualified Profit Sharing                                                                        
|       |  | ended 12/31/93   |  |         |        |  |  | Plan.*                                                                                              
|       |  |                  |  |         |        |  |  |                                                                                                     
|10-N-4 |  | 10-Q for quarter |  |         | 10-B   |  |  | Nonqualified Retirement                                                                            
|       |  | ended 3/31/02    |  |         |        |  |  | Savings Plan, as amended.*                                                                          
|       |  |                  |  |         |        |  |  |                                                                                                     
|10-N-5 |  | 10-K for year    |  |         | 10-N-6 |  |  | 1999 Employee Stock                                                                                
|       |  | ended 12/31/98   |  |         |        |  |  | Purchase Plan.                                                                                      
|       |  |                  |  |         |        |  |  |                                                                                                     
|10-N-6 |  | 10-K for year    |  |         | 10-N-7 |  |  | 1999 Stock Incentive Plan.*                                                                        
|       |  | ended 12/31/98   |  |         |        |  |  |                                                                                                     
|       |  |                  |  |         |        |  |  |                                                                                                     
|10-O-1 |  | 10-Q for quarter |  |         | 10-A   |  |  | Executive Employment Agreement,                                                                    
|       |  | ended 6/30/02    |  |         |        |  |  | John Erickson.*                                                                                     
|       |  |                  |  |         |        |  |  |                                                                                                     
|10-O-2 |  | 10-Q for quarter |  |         | 10-B   |  |  | Executive Employment Agreement                                                                     
|       |  | ended 6/30/02    |  |         |        |  |  | and amendment no. 1, Lauris Molbert.*                                                               
|       |  |                  |  |         |        |  |  |                                                                                                     
|10-O-3 |  | 10-Q for quarter |  |         | 10-C   |  |  | Executive Employment Agreement,                                                                    
|       |  | ended 6/30/02    |  |         |        |  |  | Kevin Moug.*                                                                                        
|       |  |                  |  |         |        |  |  |                                                                                                     
|10-O-4 |  | 10-Q for quarter |  |         | 10-D   |  |  | Executive Employment Agreement,                                                                    
|       |  | ended 6/30/02    |  |         |        |  |  | George Koeck.*                                                                                      
|       |  |                  |  |         |        |  |  |                                                                                                     
|10-P-1 |  | 10-Q for quarter |  |         | 10-E   |  |  | Change in Control Severance                                                                        
|       |  | ended 6/03/02    |  |         |        |  |  | Agreement, John Erickson.*                                                                          
|       |  |                  |  |         |        |  |  |                                                                                                     
|10-P-2 |  | 10-Q for quarter |  |         | 10-F   |  |  | Change in Control Severance                                                                        
|       |  | ended 6/03/02    |  |         |        |  |  | Agreement, Lauris Molbert.*                                                                         
|       |  |                  |  |         |        |  |  |                                                                                                     
|10-P-3 |  | 10-Q for quarter |  |         | 10-G   |  |  | Change in Control Severance                                                                        
|       |  | ended 6/03/02    |  |         |        |  |  | Agreement, Kevin Moug.*                                                                             
|       |  |                  |  |         |        |  |  |                                                                                                     
|10-P-4 |  | 10-Q for quarter |  |         | 10-H   |  |  | Change in Control Severance                                                                        
|       |  | ended 6/03/02    |  |         |        |  |  | Agreement, George Koeck.*                                                                           
|       |  |                  |  |         |        |  |  |                                                                                                     
|13-A   |  |                  |  |         |        |  |  | Portions of 2003 Annual
Report to Shareholders
incorporated by reference
in this Form 10-K.        
|       |  |                  |  |         |        |  |  |                                                                                                     
|21-A   |  |                  |  |         |        |  |  | Subsidiaries of Registrant.                                                                        
|       |  |                  |  |         |        |  |  |                                                                                                     
|23     |  |                  |  |         |        |  |  | Consent of Deloitte & Touche LLP.                                                                  
|       |  |                  |  |         |        |  |  |                                                                                                     
|24-A   |  |                  |  |         |        |  |  | Powers of Attorney.                                                                                
|       |  |                  |  |         |        |  |  |                                                                                                     
|31.1   |  |                  |  |         |        |  |  | Certification of Chief Executive
Officer Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|       |  |                  |  |         |        |  |  |                                                                                                     
|31.2   |  |                  |  |         |        |  |  | Certification of Chief Financial
Officer Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.

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##### Table of Contents



|     |  |                  |  |         |  |  |  |                                                                                                     
|---- |  | ---------------- |  | ------- |  |  |  | ----------------------------------------------------------------------------------------------------
|     |  | Previously Filed |  |        
|     |  |                  |  |        
|     |  |                  |  | As      |  | 
|     |  |                  |  | Exhibit |  | 
|     |  | File No.         |  | No.     |  | 
|     |  |                  |  |         |  | 
|32.1 |  |                  |  |         |  |  |  | Certification of Chief Executive
Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
|     |  |                  |  |         |  |  |  |                                                                                                     
|32.2 |  |                  |  |         |  |  |  | Certification of Chief Financial
Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.



---

|* |  | Management contract or compensatory plan or arrangement required to be filed
pursuant to Item 601(b)(10)(iii)(A) of Regulation S-K.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------

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