Bylaws

NORTH ITASCA ELECTRIC COOPERATIVE, INC. BYLAWS

AS AMENDED JUNE 15, 2023

ARTICLE I: MEMBERSHIP

Section 1.  REQUIREMENTS FOR MEMBERSHIP. Any person, firm, association, corporation, or body politic or subdivision thereof will become a member of The North Itasca Electric Co-Op., Inc. (hereinafter called the “Cooperative”) upon receipt of electric service from the Cooperative, provided that they or it comply with the Articles of Incorporation, these Bylaws and such rules and regulations as may be adopted by the Board of Directors, and has;

  1. Made a written or electronic application for membership therein;
  2. Agreed to purchase from the Cooperative electric energy as hereinafter specified;
  3. Agreed to comply with and be bound by the Articles of Incorporation and Bylaws of the Cooperative and any rules and regulations adopted by the Board of Directors, and;
  4. Agreed to permit the Cooperative to have an easement for wires, poles underground cables and other facilities across real property that may be owned by the member so as to serve the member with electricity or to serve other members of the Cooperative.

Section 2.  SINGLE MEMBERSHIP, RESTRICTION OR TRANSFER. No member may hold more than one (1) membership in the Cooperative, and no membership in the Cooperative shall be transferable, except as provided in these Bylaws;

Section 3.  MEMBERSHIP RECORDS.  The Cooperative shall maintain appropriate membership records.

Section 4.  JOINT MEMBERSHIP. Two or more adult persons may apply for a joint membership and, subject to their compliance with the requirements set forth in Section 1 of this Article, may be accepted for such membership. A joint membership shall constitute a single membership for the purposes of notice, wavier of notice, voting, expulsion, withdrawal, and election as a director. All joint members shall be jointly and severally liable for any debt incurred to the Cooperative.

A member may be converted to a joint membership upon written request of the holder thereof and the agreement by such holder and other qualifying adult applicant(s) to comply with the Articles of Incorporation, Bylaws and rules and regulations adopted by the Board.

Upon the death of any person who is a party to the joint membership, such membership shall be held solely by the survivor(s) provided, however, that the estate of the deceased shall not be released from any debts due the Cooperative.

Section 5.  PURCHASE OF ELECTRIC ENERGY. Each member shall as soon as electric energy shall be available, purchase from the Cooperative all electric energy purchased for use on the premises specified in their application for membership, and shall pay therefore at rates which shall from time to time be fixed by the Board.

Section 6.  TERMINATION OF MEMBERSHIP. Upon the withdrawal, death, cessation of existence or expulsion of a member, the membership of such member shall thereupon terminate, and the membership of such member shall be surrendered forthwith to the Cooperative. Termination of membership in any manner shall not release a member or their estate from any debts due the Cooperative. In case of withdrawal or termination of membership in any manner, the Cooperative shall repay the member the amount of the membership fee paid by him, if any, provided, however, that the Cooperative shall deduct from the amount of the membership fee the amount of any debts or obligations owed by the member of the Cooperative.

Section 7.  BYLAWS TO BE A CONTRACT. The members of the Cooperative, by dealing with the Cooperative acknowledge that the terms and provisions of the Bylaws shall constitute and be contract between the Cooperative and each member and patron, and the Cooperative and the members and patrons are bound by such contract, as fully as though each member and patron had individually signed a separate instrument containing such terms and provisions. The Provisions of these Bylaws shall be called to the attention of each member and patron of the Cooperative by posting in a conspicuous place in the Cooperative’s office.

ARTICLE II: RIGHTS AND LIABILITIES OF MEMBERS

Section 1.  PROPERTY INTERSET OF MEMBERS. Upon dissolution, after (a) all debts and liabilities of the Cooperative shall have been paid, (b) the par value if stockholders’ shares returned, and (c) all capital furnished through patronage shall have been retired as provided in these Bylaws, the remaining property and assets of the Cooperative shall be distributed among the members and former members in the proportion which the aggregate patronage of each members bears to the total patronage of all such members unless otherwise provided by law.

Section 2.  NON-LIABILITY FOR DEBTS OF THE COOPERTIVE. The private property of the members shall be exempt from execution or other liability for the debts of the Cooperative and no member shall be liable or responsible for any debts or liabilities of the Cooperative.

Section 3.  Arbitration. Any and all disputes, claims or controversies arising from or related in any way to the Cooperative’s provision of electricity or other services, or in its furnishing of any goods, or in the conduct of its operations, other than disputes or claims relating to the payment for electrical energy and/or other services provided by the Cooperative, that are not resolved by agreement of the parties, shall, at the request of either party, be resolved by binding arbitration. In the event the arbitration involves a sum in excess of $100,000.00, there shall be three (3) arbitrators, one picked by each party and a third selected by the two (2) arbitrators selected by the parties. In the event the dispute involves less than $100,000.00, there shall be one (1) arbitrator. If the parties cannot agree on the arbitrator, the determination shall be made by the Minnesota District Court in Itasca County, Minnesota. The arbitration shall take place in Itasca County, Minnesota, or as close to this location as possible, under and pursuant to the rules contained in chapter 572B of Minnesota Statutes, the Uniform Arbitration Act. The determination of any dispute in arbitration shall be governed by the laws of the State of Minnesota. The Cost of the arbitrators and the filing fees shall be shared equally by both parties.

All disputes between parties must be arbitrated individually, and not through Class Action.

Each member of the Cooperative, by the virtue of their membership, agrees to arbitrate any and all claims or controversies according to these bylaws, and this agreement to arbitrate disputes shall survive any withdrawal from or termination of a member’s membership in the Cooperative.

ARTICLE III – MEETINGS OF MEMBERS

Section 1.  ANNUAL MEETING. The annual meeting of the members shall be held annually at a time and place to be determined by the Board of Directors, for the purpose of electing Directors, passing upon reports covering the previous fiscal year and transacting such other business as may come before the meeting.

Section 2.  SPECIAL MEETINGS.  Special meeting of the members may be called by resolution of the Board of Directors or upon the written petition signed by at least twenty percent (20%) of the members. Special meetings of the members may be held at any place designated by the Board and shall be specified in the notice of special meeting.

Section 3.  NOTICE OF MEMBERS MEETINGS. Written or published notice stating the place, day and hour of an annual or special meeting and, the purpose or purposes for which the meeting is called shall be delivered to each member not less than fifteen (15) days previous to the date of such meeting. Upon mailing of any notice of a regular or special meeting of the stockholders the Secretary of the Cooperative shall execute a certificate, setting forth a correct copy of the notice mailed and showing the date of mailing thereof, and that the same was mailed within the time and in the manner prescribed by law. The certificate shall be made a part of the record of the meeting. The failure of any member to receive notice of an annual or special meeting of the members shall not invalidate any action which may be taken by the members at any such meeting.

Section 4.  QUORUM. Fifty (50) members present in person shall constitute a quorum at any meeting of members. The attendance of a sufficient number of members to constitute a quorum at any meeting of the members shall be established and verified by the Chair and Secretary, and such registration shall be reported in the minutes of such meeting. In determining a quorum at any meeting, on a question submitted to a vote by mail, members present in person or represented by mail vote shall be counted.

Section 5.  VOTING. Each member, and each joint membership, shall be entitled to only one (1) vote upon each matter submitted to a vote at a meeting of the members. All questions shall be decided by a vote of majority of the members voting in person or by mail except as otherwise provided by law, the Articles of Incorporation of the Cooperative or these Bylaws. In case of ties the election shall be determined by an impartial coin toss. No new matter may be submitted to a vote at the annual meeting unless prior notice such matter would be considered was provided by mail to all members in accord with Article III, Section 3.

Section 6.  VOTING BY MAIL. Any member who is absent from any annual or special meeting of the members may vote by mail on the ballot herein prescribed upon any motion, resolution, amendment or election of Board members to acted upon at such meeting, or may vote by such electronic means as may be adopted by the Board of Directors. The ballot shall be in the form prescribed by the Board of the Cooperative and shall contain the exact text of the proposed amendment, motion, resolution, list of nominated members for board election or other proposition to be acted upon at such meeting and the date of the meeting and shall also contain spaces opposite the text such motion, resolution affirmation or negative vote therein.

On ballots for the election of Board members, the candidates shall be listed in alphabetical order with the incumbent being designated as such and shall contain spaces opposite the list of candidates in which members may indicate the candidate of their choice. Such member shall express their choice by making a mark in the appropriate space upon the such ballot, and when received by the Secretary of the Cooperative shall be accepted and counted as the vote of any absent member at such meeting. The failure of any absent member to receive a copy of such motion or resolution or ballot shall not invalidate any action which may be taken by the members at any such meeting.

All completed ballots shall be either mailed in the envelopes provided by the Cooperative or personally delivered in said envelopes by the member to authorized personnel at the Coopeative headquarters on days prior to the election or to the election judges on the day of the annual meeting. Ballots cast by corporate members shall be accompanied by a certificate of authority signed by the President or Secretary thereof.

Section 7.  ORDER OF BUSINESS. The order of business at the annual meeting of the members, and so far as possible, at all other meetings of the members shall be essentially as follows, except as otherwise determined by such members at such meeting:

  1. Report on the number of members present in person or by mail in order to determine the existence of a quorum.
  2. Reading of the notice of the meeting and proof of the due publication or mailing thereof, or the waiver or waivers of notice of the meeting as the case may be.
  3. Reading of unapproved minutes of previous meetings of the members and the taking of necessary action thereof.
  4. Presentation and consideration of reports of Officers, Directors, and Committees.
  5. Election of Directors.
  6. Unfinished Business.
  7. New Business.
  8. Adjournment.

Section 8. REMOTE COMMUNICATIONS FOR MEMBER MEETINGS.

  1.  This Section shall be construed and applied to facilitate remote communications consistent with reasonable practices concerning remote communication and with the continued expansion of those practices.
  2. The Board of Directors is authorized to hold annual or special meetings of the members, the Board of Directors or any committee designated or appointed by the Board of Directors solely by means of remote communication through which the members, the Board of Directors or such committee representatives may participate in the meeting. Furthermore, the Board of Directors is authorized to determine that a member, Board of Directors member or committee representative not physically present in person at an annual or special meeting of members, the Board of Directors or any committee designated or appointed by the Board of Directors may, by means of remote communication, participate in a meeting of members, the Board of Directors or such committee held at a designated place. Such participation by a member, Board of Directors or such committee representative by means of remote communications constitutes presence at the meeting in person if all other requirements set forth in this Section 9 are met.
  3. In any meeting of members, the Board of Directors or any committee designated by or appointed by the Board held solely by means of remote communication or in any meeting of the members, Board of Directors or any committee designated or appointed by the Board held at a designated place in which one or more members, Board-members or committee representatives participate by means of remote communication, the Cooperative must implement reasonable measures to verify that each person deemed present and entitled to vote at the meeting by means of remote communication is a member, Board-member, or committee representative, as applicable; and the Cooperative must implement reasonable measures to provide each member, Board-member or committee representative participating by means of remote communication with reasonable opportunity to participate in the meeting, including an opportunity to: (i) read or hear the proceedings of the meeting substantially concurrently with those proceedings; (ii) if allowed by the procedures governing the meeting, have the member’s, Board-member’s or committee representative’s remarks heard or read by other participants in the meeting substantially concurrently with the making of those remarks; and (iii) if otherwise entitled, vote on matters submitted to the members, Board or committee representatives. The Board of Directors may adopt such guidelines and procedures applicable to participation in member, Board of Director and committee meetings by means of remote communications as it deems appropriate.
  4. Any ballot, vote, authorization, or consent submitted by electronic communication submitted by a member, Board-member or committee representative may be revoked by the member, Board-member or committee representative who submitted the same so long as such revocation is received by the President or the Secretary of the Cooperative at or before the meeting.
  5. Participation in a meeting by remote communication described in clause (B) or (C) of this Section 9 is a waiver of notice of that meeting, except where the member, Board-member or committee representative objects at the beginning of the meeting to the transaction of business because the meeting is not properly called or convened, or objects before a vote on an item of business because such item may not properly be considered at the meeting and does not participate in consideration of the item at the meeting.

Section 9. Certain Definitions.

The following words or phrases when used in these By-Laws have the meanings set forth below:

  1. “authenticated” means, with respect to an electronic communication, that the communication is delivered to the principal place of business of the Cooperative, or to an officer or agent of the Cooperative authorized by the Cooperative to receive the communication, and that the communication sets forth information from which the Cooperative can reasonably conclude that the communication was sent by the purported sender.
  2. “electronic communication” means any form of communication, not directly involving the physical transmission of paper that creates a record that may be retained, retrieved, and reviewed by a recipient of the communication, and that may be directly reproduced in paper form by the recipient through an automated process.
  3. “remote communication” means communication via electronic communication, conference telephone, video conference, the Internet, or such other means by which persons not physically present in the same location may communicate with each other on a substantially simultaneous basis.

ARTICLE IV – BOARD OF DIRECTORS

Section 1.  GENERAL POWERS. The business and affairs of the Cooperative shall be managed by a board of directors which shall exercise all of the powers of the Cooperative except such as are by law, the Articles of Incorporation of these Bylaws conferred upon or reserved to the members.

Section 2.  ELECTION AND TENURE OF OFFICE. The persons named as directors in the Articles of Incorporation shall compose the Board of Directors until their successors shall have been elected and shall have annual meetings of the members. The Board of Directors shall cause the entire area served by the Cooperative to be divided into no less than seven (7) or more than nine (9) districts as of equal member population as may be practical, from each of which districts one (1) Director shall be elected to serve for a term of three (3) years, and until their successor has been elected, or in case of a vacancy, for the duration of the unexpired term. No member shall vote for any person for the office of Director unless the nominee is a resident of the election district in which the member resides. Directors shall be elected by receiving a plurality of the vote of the voting members residing in the respective election district.

Section 3.  QUALIFICATIONS. No person should be eligible to become or remain a Board member of the Cooperative who:

  1. Is not a member and bona fide resident in the district served or to be served by the Cooperative. “Bona fide resident” shall mean an individual maintaining a residence in the area served or to be served by the Cooperative which (1) would entitle them to vote as a resident in any local election, or (2) shows the address as that on their Minnesota drivers license, or (3) is maintained as a homestead by the member as an owner or resident relative of the owner.
  2. Within five (5) years preceding a director candidate’s nomination was or during service on the Board of Directors is determined to be guilty of a felony;
  3. Within three (3) years preceding a director candidate’s nomination was an employee of the Cooperative;
  4. Is or becomes, at any time during t he five (5) years preceding a director candidate’s nomination shall have been, employed by a labor union which represents, or has represented, or has endeavored to represent any employees of the Cooperative;
  5. Is a grandparent, parent, sibling, spouse, co-habitant, child, or grandchild of an employee of the Cooperative;
  6. Is a person that is a grandparent, parent, sibling, spouse, co-habitant, child or grandchild of an incumbent director that is not up for re-election at that time;
  7. Is in any way employed by or substantially financially interested in an enterprise competing with the Cooperative or any Cooperative-affiliated business;
  8. Is or becomes the full time employee or agent of, or who is or becomes the full time employer or principal of, another director, or;
  9. Has unexcused absences from three (3) or more regular meetings of the Board of Directors during any twelve (12) month period.

Upon establishing of the fact that a Board member is holding the office in violation of any of the foregoing provisions, the Board shall remove such Board member from office. Nothing contained in this section shall affect in any manner whatsoever the validity of any action taken at any meeting of the Board.

Section 4.  NOMINATIONS. It shall be the duty of the Board of Directors to appoint a committee on nominations consisting of one (1) member from each of the Director districts of the Cooperative plus one (1) alternate from each Director district in which an election is being held at said meeting. No member of the Board of Directors may serve on such committee. The Secretary shall promptly cause to be mailed to the members of the Cooperative a letter informing of the membership of the nominating committee the date and time and location of its meeting, and a list of Director districts in which elections are to be held, and the procedure for nominations. The committee shall prepare and post at the principal office of the Cooperative at least thirty (30) days before the meeting, a list of nominations for Director, which said list shall consist of one (1) or more qualified candidates from each election district in which the term of the incumbent Director shall expire at the next annual meeting of the members. Any fifteen (15) or more members from any district acting together may make other nominations for Director in their district by petition not less than twenty-five (25) days prior to the meeting and the Secretary shall mail with the notice of the meeting or separately, buy at least seven (7) days before the date of the meeting a statement of the number of Directors to be elected and the names and addresses of the qualified candidates, specifying separately the nominations made by the committee on nominations and also the nominations made by petition, if any.

Section 5.  REMOVAL OF DIRECTORS BY MEMBERS. The members have the power to remove any director for just cause reasonably and directly related to the duties of the position. Any member may file such charges against a Director by filing in writing with the Secretary a petition, signed by twenty percent (20%) or more of the members residing in that Director’s district, requesting removal of the director. The President of the Board shall then appoint a Committee of five (5) Directors to review the charges and conduct such investigation as is necessary to determine within thirty (30) days whether probable cause exists as to the grounds for removal. If probable cause is not found the petition shall be rejected. If probable cause is found then proper notice of the charges and meeting shall be provided to the interested members in accord with Article III, Section 2 and the removal shall be voted upon at a Special Members meeting held not less than fifty (50) days nor more than ninety (90) days after the finding of probable cause. The Board of Directors may also call for a Special Members meeting for this purpose if it finds that probable cause exists for the removal of a Director. The Director against whom charges have been brought shall be informed in writing of the charges upon their filing. Both the Director and the Member or Members bringing the charges shall have an opportunity at the Members meeting to be heard in person or by counsel and to present evidence. After presentation of evidence the members shall vote on whether the Director shall be removed from office, and removal shall be effected by a majority vote of those members residing in that Directors district and present at the meeting. The vacancy created by any such removal shall be filled by the members of that District at a subsequent special meeting called for that purpose.

Section 6.  VACANCIES. Subject to the provisions of these Bylaws, with respect to the filling of vacancies, a vacancy occurring in the Board of Directors may be filled by the affirmative vote of a majority of the remaining Directors until the next annual meeting of the members, unless the vacancy is caused by removal of the Director by members in accord with Article IV, Section 5.

Section 7.  COMPENSATION. Board members shall not receive any salary for their services as such, except that the Board of Directors may by resolution authorize a fixed sum for each day or portion thereof spent on Cooperative business. Reimbursement for expenses actually and necessarily incurred in carrying out such Cooperative business or granted reasonable per diem allowance by the Board in lieu of detailed accounting of such expenses, and participation in insurance programs offered to employees. No Board member shall receive compensation for serving the Cooperative in any other capacity, unless the payment and amount of compensation shall be specifically authorized by a vote of the members or the service by the Board member shall have been certified by the Board as an emergency measure.

Section 8. ELECTION BY ACCLAMATION. In the event there is only one candidate duly nominated for
election to a Director position for a district, the single candidate nominated for such district shall be
deemed elected by acclamation as an unopposed candidate, an no Member voting shall be required for
such uncontested Director Position. The official notice of the Annual Meeting of the Members shall
state the name of any candidate elected by acclamation, and the individual presiding at the Annual
Meeting will announce that the uncontested candidate was elected by acclamation, and that no vote
was required. Each elected Director shall take office as of the end of such Annual Meeting.

ARTICLE V – MEETING OF THE BOARD

Section 1.  REGULAR MEETINGS.  A regular meeting of the Board of Directors shall be held without notice immediately after, and at the same place as the annual meeting of members. A regular meeting of the Board of Directors shall also be held monthly at the Cooperative headquarters or at any other site within the area served by the Cooperative at such time as the Board of Directors may provide by resolution and as provided in Section Five of this Article. Such regular monthly meetings may be held without notice other than such resolution fixing the time and place thereof.

Section 2.  SPECIAL MEETINGS. Special meetings of the Board of Directors may be called by the President or by any three (3) Directors, and it shall thereupon be the duty of the Secretary to cause notice of such meeting to be given as hereinafter provided. The President of the Directors calling the meeting shall fix the time for holding the meeting, which shall be at the Cooperative headquarters or at any other site in the area served by the Cooperative as provided by resolution and as provided in Section Five of this Article. The matters considered and acted upon by the Board at a Special Meeting shall be limited to those specific items indicated in the Notice of meeting provided to the Directors.

Section 3.  NOTICE OF DIRECTORS MEETING.  Written notice of the time, place and purpose of any special meeting of the Board of Directors shall be delivered to each Director not less than five (5) days pervious thereto either personally, by mail, by facsimile mail, or by such electronic means as may be adopted by the Board, at the Directors last known address. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail addressed to the Director at their address as it appears on the records of the Cooperative with postage thereon prepaid. Any Director may waive in writing any notice of a meeting required to be given by these Bylaws. The attendance of a Director at any meeting shall constitute a wavier of notice of such meeting by such Director, except in case a Director shall attend a meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting has not been lawfully called or convened.

Section 4.  QUORUM. A majority of the Board shall constitute a quorum, provided, that if less than such majority of the Board is present at said meeting, a majority of the Directors present may adjourn the meeting from time to time; and provide further, that the Secretary shall notify any absent Board members of the time and place of such adjourned meeting.

Section 5. MEETING BY MEANS OF ELECTRONIC COMMUNICATION. Directors may participate in a regular or special meeting of the Board of Directors by means of conference telephone or by means of electronic communication as may be adopted by the Board by which all persons participating in the meeting can simultaneously hear each other. Participation in a meeting pursuant to this Section shall constitute presence in person at such meeting.

ARTICLE VI – OFFICERS

Section 1.  NUMBER. The officers of the Cooperative shall be a President, Vice President, Secretary, Treasurer, Chief Executive Officer, and such other Officers as may be determined by the Board from time to time. The offices of Secretary and Treasurer may be held by the same person.

Section 2.  ELECTION AND TERM OF OFFICERS. Except for the Chief Executive Officer, the Officers shall be elected by and from the Board at the meeting of the Board held immediately after the annual meeting of the members. If the election of Officers shall not be held at such meeting, such election shall be held as soon thereafter as conveniently may be. Each Officer shall hold office until the first meeting of the Board following the next succeeding annual meeting of the members or until their successor shall have been elected and shall have qualified. A vacancy in any office shall be filled by the Board for the unexpired portion of the term.

Section 3.  REMOVAL OF OFFICERS AND AGENTS BY THE BOARD, RESIGNATION. Any Officer or Agent elected or appointed by the Board may be removed by the Board whenever in its judgement the best interests of the Cooperative will be served thereby. Any Officer or Agent elected or appointed by the Board may resign by written resignation delivered to the Board President. Such resignation shall be effective on the date stated in the resignation, or upon receipt by the Board President, whichever is later.

Section 4.  PRESIDENT. The President shall:

  1. Preside at all meetings of the members and the Board;
  2. Sign, with the Secretary, any deeds, mortgages, deeds of trust, notes, bonds, contracts, or other instruments authorized by the Board to be executed, except in cases in which the signing and execution thereof shall be expressly delegated by the Board or by these Bylaws to some other Officer or Agent of the Cooperative, or shall be required by law to be otherwise signed or executed; and
  3. In general perform all duties incident to the office of President and such other duties as may be prescribed by the Board from time to time.

Section 5.  VICE PRESIDENT. In the absence of the President, or in the event of their inability or refusal to act, the Vice President shall preform the duties of the President, and when so acting shall have all the powers of and be subject to all restrictions upon the President. The Vice President shall also preform such other duties as from time to time may be assigned to him by the Board.

Section 6.  SECRETARY. The Secretary shall be responsible for:

  1. Keeping the minutes of the meetings of the members and of the Board in books provided for that purpose;
  2. See that all notices are duly given in accordance with these Bylaws or as required by law;
  3. The safekeeping of the corporate books and records and the seal of the Cooperative and affixing the seal of the Cooperative to all documents, the execution of which on behalf of the Cooperative under its seal is duly authorized in accordance with the provisions of these Bylaws;
  4. Keeping a register of the names an post office addresses of all members;
  5. Keeping on file at all times a complete copy of the Articles of Incorporation and Bylaws of the Cooperative containing all amendments thereto (which a copy shall always be open to the inspection of any member) and at the expense of the Cooperative, furnishing a copy of the Bylaws and of all amendments thereto to any member upon request; and
  6. In general preforming all duties incident to the office of Secretary and such other duties as from time to time may be assigned to him by the Board.

Section 7.  TREASURER. The Treasurer shall be responsible for:

  1. Custody of all funds and securities of the Cooperative;
  2. The receipt of and the issuance of receipts for all monies due and payable to the Cooperative and for the deposit of all such monies in the name of the Cooperative in such bank or banks as shall be selected in accordance with the provisions of these Bylaws; and
  3. The general performance of all other duties incident to the office of Treasurer and such other duties as from time to time may be assigned to him by the Board.

Upon the request of the Treasurer, the Board of Directors shall authorize the Treasurer to delegate any or all of the duties to responsible employees of the Cooperative.

Section 8.  CHIEF EXECUTIVE OFFICER. The Chief Executive Officer:

  1. Shall be the Chief Executive Officer and have general charge and management of the business of the Cooperative, subject to the control of the Board of Directors;
  2. Shall sign all certificates, deeds, mortgages, contracts and other instruments s authorized by the Board of Directors;
  3. Shall make reports to the Board of Directors and members of the Cooperative; and
  4. Shall preform such other duties as may be prescribed by the Board of Directors.

Section 9.  BONDS OF OFFICERS. The Treasurer and any other Officer or Agent of the Cooperative charged with responsibility for the custody of its funds or property may be bonded in such sum and with surety as the Board shall determine. The Board in its discretion may also require any other Officer, Agent or employee or the Cooperative to be bonded in such amount and with such surety as it shall determine.

Section 10.  COMPENSATION. The powers, duties and compensation of Officers, Agents and employees shall be fixed by the Board subject to the provisions of these Bylaws with respect to compensation for a Board member.

Section 11.  REPORTS. The officers of the Cooperative shall submit at each annual meeting of the members, reports covering the business of the Cooperative for the previous fiscal year. Such reports shall set forth the condition of the Cooperative at the close of such fiscal year.

ARTICLE VII – DISTRIBUTION OF EARNINGS

Section 1.  MEMBERS AND PARTONS. The Cooperative shall at times be operated on a Cooperative non-profit basis for the mutual benefit of its members. For purposed of this Article VII, a member means a person or entity that both purchases and takes delivery of electric energy from the Cooperative and receives an allocation of patronage capital. A patron means a person or entity that does not both purchase and take delivery of electric energy from the Cooperative, but that purchases other products or services from the Cooperative, but does not receive an allocation of patronage capital.

Section 2.  PATRONAGE CAPITAL IN CONNECTION WITH DELIVERY AND SALE OF ELECTRIC ENERGY. In the delivery and sale of electric energy, the Cooperative’s operations shall be so conducted that all members will, through their patronage, furnish capital for the Cooperative. In order to induce patronage and to assure that the Cooperative will operate on a non-profit basis, the Cooperative is obligated to account on patronage basis to all its members for all amounts received and receivable from the delivery and sale of electric energy in excess of operating cost and expenses properly chargeable against the delivery and sale of electric energy. All such amounts in excess of operating costs and expenses at the moment of receipt by the Cooperative are received with the understanding that they are furnished by the members as capital. The Cooperative is obligated to pay by credits to a capital account for each member all such amounts in excess of operating costs, expenses, and such reserves authorized by these Bylaws which may be established by the Board of Directors. The books and records of the Cooperative shall be set up and kept in such a manner that, at the end of each fiscal year, the amount of capital, if any, so furnished by each member is clearly reflected and credited in an appropriate record to the capital account of each member.

All such amounts credited to the capital account of any member shall have the same status as though they had been paid to the member in cash in pursuance of a legal obligation to do so, and the member had then furnished the Cooperative corresponding amounts for capital.

All other amounts received by the Cooperative from its operations in excess of cost and expenses shall, insofar as permitted by law, be:

  1. Used to offset any losses incurred during the current or any prior fiscal year and,
  2. To the extent not needed for that purpose, allocated to its members on a patronage basis and any amount so allocated shall be included as part of the capital credited to the accounts of members, as herein provided.

The Cooperative may set aside such part of its net income as its Board of Directors deems advisable for the purpose of creating or maintaining a capital reserve, and may establish and accumulate reserves for new buildings, machinery, and equipment, depreciation, losses and other proper capital or operating purposes.

In the event of dissolution or liquidation of the Cooperative after all outstanding indebtedness of the Cooperative shall have been paid, outstanding capital credits shall be retired without priority on a pro rata basis before any payments are made on account of property rights of members. If at any time prior to dissolution or liquidation, the Board of Directors shall determine that the financial condition of the Cooperative will not be impaired thereby, the capital credited to members’ accounts may be retired in full or in part. The Board of Directors shall determine the method, basis, priority and order of retirement, if any, for all amounts heretofore and hereafter furnished as capital.

In no event, however, shall any capital be retired contrary to the provisions of any unsatisfied mortgage executed by the Cooperative.

Section 3.  PATRONAGE REFUNDS IN CONNECTION WITH FURNISHING OTHER SERIVCES. In the event that the Cooperative should engage in the business of furnishing goods or services other than the delivery and sale of electric energy to members, all amounts received and receivable therefrom which are in excess of costs, expenses, and such reserves authorized by these Bylaws which may be established by the Board of Directors, shall be allocated annually and returned to the members of this Cooperative as authorized by the Board of Directors. The Board of Directors shall determine the method, basis, priority, and order of retirement, if any, for all such amounts heretofore or hereafter furnished as capital.

ARTICLE VIII – DISPOSITION OF PROPERTY

The Board of Directors may sell, mortgage, lease or otherwise dispose of or encumber the property of the Cooperative upon such terms and conditions as it deems appropriate and in the best interests of the Cooperative. No sale of more than twenty-five percent (25%) of the property of the Cooperative shall be effective, however, unless authorized at a regular or special meeting by the affirmative vote of two-thirds (2/3) of the total number of members of the Cooperative.

ARTICLE IX – SEAL

The corporate seal of the Cooperative shall have inscribed thereon the name of the Cooperative and the words “Corporate Seal Minnesota”.

ARTICLE X – MISCELLANEOUS

Section 1.  WAIVER OF NOTICE. Any member or Board member may waive in writing any notice of a meeting required to be given by these Bylaws. The attendance of a member or Board member at any meeting shall constitute a wavier of notice of such meeting by such member or Board member, except in case a member or Board member shall attend a meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting has not been lawfully called or convened.

Section 2.  POLICIES, RULES AND REGULATIONS. The Board shall have power to make and adopt such policies, rules and regulations, not inconsistent with law, the Articles of Incorporation or these Bylaws, as it may deem advisable for the management of the business and affairs of the Cooperative.

Section 3.  ACCOUNTING SYSTEM AND REPORTS. The Board shall cause to be established and maintained a complete accounting system which, among other things, and subject to applicable laws and rules and regulations of any regulatory body, shall conform to such accounting system as may from time to time be designed by the Administration of the Rural Utility Service of the United States of America. The Board shall also after the close of each fiscal year cause to be made a certified public accountant a full and complete audit of the accounts, books and financial condition of the Cooperative as of the end of each fiscal year. A report of such audit shall be submitted to the members at the next following annual meeting.

Section 4.  AREA COVERAGE. The Board shall make diligent effort to see that electric service is extended to all unserved persons within the Cooperative service area who desire such service and meet all reasonable requirements established by the Cooperative as a condition of service.

ARTICLE XI – AMENDMENTS

These Bylaws may be altered, amended, or repealed by the members present in person or represented by mail ballot, at any regular or special meeting, provided the notice of such meeting shall have contained a copy of the purposed alteration, amendment or repeal. Any amendment or repeal of Article VIII must be approved by two-thirds (2/3) majority vote of the membership of the Cooperative.