**Exhibit 4.1**
FIFTH AMENDMENT TO CREDIT AGREEMENT
     THIS FIFTH AMENDMENT, dated as of October 28, 2004, amends and modifies acertain Credit Agreement, dated as of April 30, 2002, as amended by amendmentsdated as of September 19, 2002, April 29, 2003, August 25, 2003 and April 28,2004 (as so amended, the “Credit Agreement”), among OTTER TAIL CORPORATION, aMinnesota corporation (the “Borrower”), U.S. BANK NATIONAL ASSOCIATION, asAgent (in such capacity, the “Agent”), and the Banks, as defined therein.Terms not otherwise expressly defined herein shall have the meanings set forthin the Credit Agreement.
     FOR VALUE RECEIVED, the Borrower, the Agent and the Banks agree that theCredit Agreement is amended as follows.
ARTICLE I — AMENDMENT TO THE CREDIT AGREEMENT
     1.1 New Definitions. The following new definitions are added to Section1.1 of the Credit Agreement:
          “‘Senior Indebtedness Agreement’ means any agreement, instrument orindenture governing senior unsecured Indebtedness of the Borrower(‘Senior Indebtedness’), including without limitation the Note PurchaseAgreement, dated as of December 1, 2001, as thereafter amended (the ‘NotePurchase Agreement’), between the Borrower and the Noteholders namedtherein pertaining to the $90,000,000, 6.63% Senior Notes of the Borrowerdue December 1, 2011.”
          “‘Senior Indebtedness Prepayment Event’ means the (a) occurrence ofany event under any Senior Indebtedness Agreement that would require theBorrower to prepay, or offer to prepay, any Senior Indebtedness prior toits stated maturity, (b) occurrence of any event under any SeniorIndebtedness Agreement that would give the holder of Senior Indebtednessany right to put such Senior Indebtedness to the Borrower or require theBorrower to repurchase or redeem such Senior Indebtedness in each caseprior to its stated maturity, or (c) voluntary offer by the Borrower toprepay or purchase Senior Indebtedness prior to its stated maturity toremain in compliance with any covenant or agreement of a SeniorIndebtedness Agreement. Senior Indebtedness Prepayment Events shallinclude, without limitation, any Transfer of Utility Assets Put Event orDebt Prepayment Application under the Note Purchase Agreement.”
     1.2 Senior Indebtedness Prepayment Event. New Section 4.6 is added afterSection 4.5, and shall read as follows:
          “Section 4.6 Senior Indebtedness Prepayment Event.
(a) If a Senior Indebtedness Prepayment Event shall occur, the Borrowershall offer to reduce the Commitments hereunder in Ratable Portion notlater than the date of prepayment, purchase or redemption of the relevantSenior Indebtedness, by written notice given to the
 

 

Agent not later than any notice required under the relevant SeniorIndebtedness Agreement. The Agent shall promptly give notice of suchoffer to the Banks and upon direction of the Required Banks, shall, bywritten notice given to the Borrower, shall elect whether to require sucha reduction of the Commitments hereunder. In the absence of direction bythe Required Banks, the Agent shall require such a reduction.
(b) If such a reduction of the Commitments shall be so required, it willbecome effective upon the prepayment, purchase or redemption by theBorrower of the relevant Indebtedness under the relevant SeniorIndebtedness Agreement. Upon such reduction, if the Loans and the Letterof Credit Obligations outstanding shall exceed the Commitment as soreduced, the Borrower shall (i) pay any Loans, and (ii) deliver cashcollateral for the Letter of Credit Obligations to be held and applied inaccordance with the terms of Section 10.3, in the amount of such excess.Failure by the Borrower to so pay the Loans or deliver such cashcollateral shall constitute an Event of Default under Section 10.1(a)hereof.
(c) For such purpose, a ‘Ratable Portion’ shall mean a fraction thenumerator of which is equal to the amount of the prepayment, purchase orredemption of the relevant Senior Indebtedness that the Borrower isrequired to make or offer to make, and the denominator of which is theaggregate principal amount of such Senior Indebtedness outstanding. Inthe instance of a Transfer of Utility Assets Put Event under the NotePurchase Agreement, the Ratable Portion shall be 100%.”
     1.3 Ratings Covenant. New Section 8.13 is added after Section 8.12, andshall read as follows:
          “Section 8.13 Ratings Triggers. If documentation applicable to anyIndebtedness of the Borrower or any Subsidiary shall hereafter include aRatings Trigger, the Borrower shall promptly notify the Agent of suchRatings Trigger. If any Ratings Trigger shall apply to the Borrower orany Subsidiary and if the Agent shall so request of the Borrower, theBorrower agrees to enter into an amendment to this Agreement to include asubstantively similar Ratings Trigger in this Agreement (subject toapproval of the Required Banks, it being agreed that if the RequiredBanks shall not enter into such an amendment, the Borrower shall not bedeemed to have failed to comply with this Section). For such purpose, a‘Ratings Trigger’ shall mean any provision in any document applicable toany Indebtedness of the Borrower or any Subsidiary stating that if theBorrower or any Subsidiary shall not maintain a minimum debt rating byS&P, Moody’s or any other ratings agency: (i) the Borrower or suchSubsidiary shall be deemed not to have complied with such document, (ii)a default or event of default or other acceleration event shall be deemedto have occurred under such document, or (iii) Indebtedness governed bysuch document shall be prepaid or the holder of such Indebtedness shallhave the option to require such prepayment (whether immediately or withthe giving of notice, passage of time or both).”
1.4 Deletion of Ratings Default. Section 10.1(l) is amended to read asfollows:
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“(l) Intentionally omitted; or”
     1.5 Construction. All references in the Credit Agreement to “thisAgreement”, “herein” and similar references shall be deemed to refer to theCredit Agreement as amended by this Amendment.
ARTICLE II — REPRESENTATIONS AND WARRANTIES
     To induce the Agent and the Banks to enter into this Amendment and to makeand maintain the Loans under the Credit Agreement as amended hereby, theBorrower hereby warrants and represents to the Agent and the Banks that it isduly authorized to execute and deliver this Amendment, and to perform itsobligations under the Credit Agreement as amended hereby, and that thisAmendment constitutes the legal, valid and binding agreement of the Borrower,enforceable in accordance with its terms.
ARTICLE III — CONDITIONS PRECEDENT
     This Amendment shall become effective on the date first set forth above,provided, however, that the effectiveness of this Amendment is subject to thesatisfaction of each of the following conditions precedent:
     3.1 Warranties. Before and after giving effect to this Amendment, therepresentations and warranties in Article VII of the Credit Agreement shall betrue and correct as though made on the date hereof, except for changes that arepermitted by the terms of the Credit Agreement. The execution by the Borrowerof this Amendment shall be deemed a representation that the Borrower hascomplied with the foregoing condition.
     3.2 Defaults. Before and after giving effect to this Amendment, noDefault and no Event of Default shall have occurred and be continuing under theCredit Agreement. The execution by the Borrower of this Amendment shall bedeemed a representation that the Borrower has complied with the foregoingcondition.
3.3 Documents. The following shall have been executed, delivered and paidto the Agent:
(a) This Amendment, executed by the Borrower, the Agent and the Banks;
(b) The Acknowledgment in the form attached hereto, executed by theGuarantor;
(c) Evidence satisfactory to the Agent that each credit agreement, note,indenture or other document respecting Indebtedness that had had aRatings Trigger has been amended to delete such Ratings Trigger (whichmay include copies of amendments to such document that will be enteredsimultaneously with this Amendment).
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ARTICLE IV — GENERAL
     4.1 Expenses. The Borrower agrees to reimburse the Agent upon demand forall reasonable expenses (including reasonable attorneys’ fees and legalexpenses) incurred by this Agent in the preparation, negotiation and executionof this Amendment and any other document required to be furnished herewith.
     4.2 Counterparts. This Amendment may be executed in as many counterpartsas may be deemed necessary or convenient, and by the different parties heretoon separate counterparts, each of which, when so executed, shall be deemed anoriginal but all such counterparts shall constitute but one and the sameinstrument.
     4.3 Severability. Any provision of this Amendment which is prohibited orunenforceable in any jurisdiction shall, as to such jurisdiction, beineffective to the extent of such prohibition or unenforceability withoutinvalidating the remaining portions hereof or affecting the validity orenforceability of such provisions in any other jurisdiction.
     4.4 Law. This Amendment shall be a contract made under the laws of theState of Minnesota, which laws shall govern all the rights and dutieshereunder.
     4.5 Successors; Enforceability. This Amendment shall be binding upon theBorrower, and Agent and the Banks and their respective successors and assigns,and shall inure to the benefit of the Borrower, the Agent and the Banks and thesuccessors and assigns of the Agent and the Banks.Except as hereby amended, the Credit Agreement shall remain in full force andeffect and is hereby ratified and confirmed in all respects.
(signature page follows)
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     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to beexecuted by their respective officers thereunto duly authorized as of the datefirst written above.         OTTER TAIL CORPORATION          By: /s/ Kevin Moug          Kevin G. Moug   Title: CFO & Treasurer           U.S. BANK NATIONAL ASSOCIATION,   as Agent and a Bank          By: /s/ Ronald P. Robson               Title: Vice President           BANK ONE, N.A., as a Bank        By: /s/ Jane Bek Keil               Title: Director           BANK HAPOALIM B.M., as a Bank        By: /s/ J. Surless                Title:       VP        and            By: /s/ B. Dan               Title: SVP           WELLS FARGO BANK, NATIONAL   ASSOCIATION, as a Bank          By: /s/ G. N. Ophaug               Title: Vice President  
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ACKNOWLEDGMENT
     Reference is made to the Guaranty, dated as of April 30, 2002 (the“Guaranty”) pursuant to which the undersigned, as Guarantor (the “Guarantor”)has guaranteed payment and performance of obligations of Otter Tail Corporation(the “Borrower”) to U.S. Bank National Association, as Agent, and the Banks(the “Creditors”) under the Credit Agreement among the Borrower and theCreditors dated as of April 30, 2002 (as thereafter amended, the “CreditAgreement”) and under each Note and Loan Document, as defined in the CreditAgreement. The Guarantor acknowledges that it has received a copy of theproposed Fifth Amendment to the Credit Agreement, to be dated on or aboutOctober 28, 2004 (the “Amendment”). The Guarantor agrees and acknowledges thatthe Amendment shall in no way impair or limit the right of the Creditors underthe Guaranty, and confirm that by the Guaranty, the Guarantor continues toguaranty payment and performance of the obligations of the Borrower to the Bankunder the Credit Agreement as amended pursuant to the Amendment. The Guarantorhereby confirms that the Guaranty remains in full force and effect, enforceableagainst the Guarantor in accordance with its terms.
Dated as of October 28, 2004.         VARISTAR CORPORATION    By: /s/ Kevin Moug