Bylaws

April 14, 2020

Index

Article I. Membership

  • Section 1.01. Eligibility.
  • Section 1.02. Application and Acceptance for Membership; Renewal of Prior Application.
  • Section 1.03. Application Fee; Service Security and Facilities Extension Deposits; Contribution in Aid of Construction.
  • Section 1.04. Joint Membership.
  • Section 1.05. Purchase of Electric Power and Energy, Power Production by Member; Application of Payments to All Accounts.
  • Section 1.06. Excess Payments to be Credited as Member-Furnished Capital.
  • Section 1.07. Wiring of Premises; Responsibility Therefor; Responsibility for Meter Tampering or Bypassing and for Damage to Cooperative Properties; Extent of Cooperative Responsibility; Indemnification.
  • Section 1.08. Member to Grant Easements to Cooperative and to Participate in Required Cooperative Load Management Programs.
  • Section 1.09. Nondiscrimination

Article II. Membership Suspension and Termination

  • Section 2.01. Suspension; Reinstatement.
  • Section 2.02. Termination by Expulsion; Renewed Membership.
  • Section 2.03. Termination by Withdrawal or Resignation.
  • Section 2.04. Termination by Death or Cessation of Existence; Continuation of Membership in Remaining or New Partners.
  • Section 2.05. Effect of Termination.
  • Section 2.06. Effect of Death or Divorce upon a Joint Membership.
  • Section 2.07. Acceptance of Members Retroactively.

Article III. Meetings of Members

  • Section 3.01. Annual Meeting.
  • Section 3.02. Special Meetings.
  • Section 3.03. Notice of Member Meetings.
  • Section 3.04. Quorum.
  • Section 3.05. Voting.
  • Section 3.06. Credentials and Election Committee.
  • Section 3.07. Order of Business.

Article IV. Directors

  • Section 4.0l. Number and General Powers.
  • Section 4.02. Qualifications.
  • Section 4.03. Election.
  • Section 4.04. Tenure.
  • Section 4.05. Seven Directorate Districts.
  • Section 4.06. Nominations.
  • Section 4.07. Voting for Directors; Validity of Board Action.
  • Section 4.08. Removal of Directors.
    • A. Removal By Members.
    • B. Removal By Board of Directors
  • Section 4.09. Vacancies.
  • Section 4.10. Compensation; Expenses.

Article V. Meetings of Directors

  • Section 5.01. Regular Meetings.
  • Section 5.02. Special Meetings except other than Article XI.
  • Section 5.03. Notice of Directors Meetings.
  • Section 5.04. Quorum.

Article VI. Officers; Miscellaneous

  • Section 6.01. Number and Title.
  • Section 6.02. Election and Term of Office.
  • Section 6.03. Removal.
  • Section 6.04. Vacancies.
  • Section 6.05. President.
  • Section 6.06. Vice President.
  • Section 6.07. Secretary.
  • Section 6.08. Treasurer.
  • Section 6.09. Delegation of Secretary's and Treasurer's Responsibilities.
  • Section 6.10. Chief Executive Officer
  • Section 6.11. Bonds.
  • Section 6.12. Compensation; Indemnification.
  • Section 6.13. Reports.

Article VII. Contracts, Checks, and Deposits

  • Section 7.01. Contracts.
  • Section 7.02. Checks, Drafts, etc.
  • Section 7.03. Deposits; Investments.

Article VIII. Cooperative Operation

  • Section 8.01. Nonprofit and cooperative operation.
  • Section 8.02. Allocation of Capital Credits.
  • Section 8.03. Notification and Assignment of Capital Credits.
  • Section 8.04. Retirement of Capital Credits
  • Section 8.05. Retirement of Discounted Capital Credits to Decedent’s estates.
  • Section 8.06. No Special Retirement of Capital Credits for Entities.

Article IX. Unclaimed Funds of Members

Article X. Waiver of Notice

Article XI. Disposition and Pledging of Property; Distribution of Surplus Assets on Dissolution

  • Section 11.01. Disposition and Pledging of Property.
  • Section 11.02. Distribution of Surplus Assets on Dissolution.

Article XII. Authority to Issue Obligations

Article XIII. Calendar Year

Article XIV. Rules of Order

Article XV. Seal

Article XVI. Amendments

Article I. Membership

Section 1.01. Eligibility. Any natural person, firm, association, corporation, business trust, partnership, federal agency, state or political subdivision or agency thereof, or body politic (each hereinafter referred to as "person," "applicant," "him" or "his") shall be eligible to become a member of, and, at one or more premises owned or directly occupied or used by him, to receive electric service from, Clark County Rural Electric Membership Corporation, Inc. (hereinafter alternatively called the "Cooperative," "the "Corporation" or the "REMC"). No person shall hold more than one membership in the Cooperative.

Section 1.02. Application and Acceptance for Membership; Renewal of Prior Application. Any person seeking to become a member must complete an application for membership within a reasonable time of using energy supplied by the Cooperative. Notwithstanding any provision herein to the contrary an applicant may not retain the privilege of membership until the membership procedure set forth in these Bylaws have been completed. Application for membership--wherein the applicant shall agree to purchase electric power and energy from the Cooperative and to be bound by and to comply with all of the other provisions of the Cooperative's Articles of Incorporation and Bylaws, and all rules, regulations and rate schedules established pursuant thereto and all applicable rules and regulations of the Indiana Utility Regulatory Commission, as all the same then exist or may thereafter be duly adopted, amended and promulgated (the obligations embraced by such agreement being hereinafter called "membership obligations")--shall be made in writing on such form as is provided therefor by the Cooperative.

With respect to any particular classification of service for which the Board of Directors shall require it, such application shall be accompanied by a supplemental contract, executed by the applicant on such form as is provided therefor by the Cooperative. The membership application shall be accompanied by the application fee provided for in Section 1.03 (together with any easement, service security deposit, service connection deposit or fee, facilities extension deposit, or contribution in aid of construction that may be required by the Cooperative), which fee (and such service security deposit, service connection deposit or fee, facilities extension deposit, or contribution in aid of construction, if any) upon payment constitutes acceptance of application for membership.

Any former member of the Cooperative may, by the sole act of paying a new application fee and any unpaid balance due on an outstanding account (together with any service security deposit, service connection deposit or fee, facilities extension deposit, or contribution in aid of construction that may be required by the Cooperative), renew and reactivate any prior application for membership to the same effect as though the application had been newly made on the date of such payment.

Section 1.03. Application Fee; Service Security and Facilities Extension Deposits; Contribution in Aid of Construction. The application fee shall be as fixed from time to time by the Board of Directors. The Cooperative may require, in such amount (s) as prescribed by the Cooperative, easement deposits or fees, service security deposits or fees, service connection deposits or fees, facilities extension deposits or fees, contribution in aid of construction deposits or advances, or any combination thereof, before any service connection ( original, subsequent or additional).

Section 1.04. Joint Membership. The application for membership by either spouse to a legally recognized marriage shall be accepted as a joint membership, unless both spouses to the marriage specifically request in writing that the membership be established in an individual name. If one spouse is already a member at the time of marriage the membership is automatically converted into a joint membership unless both spouses dictate otherwise in writing. The words "member," "applicant," "person," "his" and "him," as used in these Bylaws, shall include both spouses applying for or holding a joint membership, unless otherwise clearly distinguished in the text; and all provisions relating to the rights, powers, terms, conditions, obligations, responsibilities and liabilities of membership shall apply equally, severally and jointly to them. Without limiting the generality of the foregoing--

    1. the presence at a meeting of either or both shall constitute the presence of one member and a joint waiver of notice of the meeting;
    2. the vote of either or both shall constitute, respectively, one joint vote:
    3. notice to, or waiver of notice signed by, either or both shall constitute, respectively, a joint notice or waiver of notice;
    4. suspension or termination in any manner of either shall constitute, respectively, suspension or termination of the joint membership;
    5. either, but not both concurrently, shall be eligible to serve as a director of the Cooperative, but only if both meet the qualifications required therefor; and
    6. neither will be permitted to have any additional service connections except through their one joint membership.

Section 1.05. Purchase of Electric Power and Energy; Power Production by Member; Application of Payments to All Accounts. The Cooperative shall use reasonably diligent efforts to furnish its members with adequate and dependable electric service, although it cannot and therefore does not guarantee a continuous and uninterrupted supply thereof; and each member, for so long as such premises are owned or directly occupied or used by him, shall purchase from the Cooperative all central station electric power and energy purchased for use on all premises to which electric service has been furnished by the Cooperative pursuant to his membership, unless and except to the extent that the Board of Directors may in writing waive such requirement, and shall pay therefor at the times, and in accordance with the rules, regulations, and rate schedules (including any monthly minimum amount that may be charged without regard to the amount of electric power and energy actually used) established by the Board of Directors and, if in effect, in accordance with the provisions of any supplemental contract that may have been entered into as provided for in Section 1.02.

Production or use of electric energy on such premises, regardless of the source thereof, by means of facilities which shall be interconnected with Cooperative facilities, shall be subject to appropriate regulations as shall be fixed from time to time by the Cooperative. Each member shall also pay all other amounts owed by him to the Cooperative as and when they become due and payable.

When the member has more than one service connection from the Cooperative, any payment by him for service from the Cooperative shall be deemed to be allocated and credited on a pro rata basis to his outstanding accounts for all such service connections, notwithstanding that the Cooperative's actual accounting procedures do not reflect such allocation and proration.

Section 1.06. Excess Payments to be Credited as Member-Furnished Capital. All amounts paid for electric service in excess of the Cost thereof shall be furnished by members as capital, and each member shall be credited with the capital so furnished as provided in Article IX of these Bylaws.

Section 1.07. Wiring of Premises; Responsibility Therefor; Responsibility for Meter Tampering or Bypassing and for Damage to Cooperative Properties; Extent of Cooperative Responsibility; Indemnification. Each member shall cause all premises receiving electric service pursuant to his membership to become and to remain wired in accordance with the specifications of the Indiana Fire Insurance Underwriters Association, the National Electric Code, any applicable state code or local government ordinances, and of the Cooperative.

Each member shall be responsible for--and shall indemnify the Cooperative and its employees, agents and independent contractors against death, injury, loss or damage resulting from any defect in or improper use or maintenance of--such premises and all wiring and apparatuses connected thereto or used thereon. Each member shall make available to the Cooperative a suitable site, as determined by the Cooperative, whereon to place the Cooperative's physical facilities for the furnishing and metering of electric service and shall permit the Cooperative's authorized employees, agents and independent contractors to have access thereto safely and without interference from hostile dogs or any other hostile source, for meter reading, bill collecting and for inspection, maintenance, replacement, relocation, repair or disconnection of such facilities at all reasonable times.

As part of the consideration for such service, each member shall be the Cooperative's bailee of such facilities and shall accordingly desist from interfering with, impairing the operation of or causing damage to such facilities, and shall use his best efforts to prevent others from so doing.

Each member shall also provide such protective devices to his premises, apparatuses or meter base as the Cooperative shall from time to time require in order to protect the Cooperative's physical facilities and their operation and to prevent any interference with or damage to such facilities. In the event such facilities are interfered with, impaired in their operation or damaged by the member, or by any other person when the member's reasonable care and surveillance should have prevented such, the member shall indemnify the Cooperative and its employees, agents and independent contractors against death, injury, loss or damage resulting therefrom, including but not limited to the Cooperative's cost of repairing, replacing or relocating any such facilities and its loss, if any, of revenues resulting from the failure or defective functioning of its metering equipment.

The Cooperative shall, however, in accordance with its applicable service rules and regulations, indemnify the member for any overcharges for service that may result from a malfunctioning of its metering equipment or any error occurring in the Cooperative's billing procedures. In no event shall the responsibility of the Cooperative for furnishing electric service extend beyond the point of delivery.

Section 1.08. Member to Grant Easements to Cooperative and to Participate in Required Cooperative Load Management Programs. Each member shall, upon being requested so to do by the Cooperative, execute and deliver to the Cooperative grants of easement or right-of-way over, on and under such lands owned or leased by or mortgaged to the member, and in accordance with such reasonable terms and conditions, as the Cooperative shall require for the furnishing of electric service to him or other members or for the construction, operation, maintenance or relocation of the Cooperative's electric facilities.

Each member shall participate in any required program that may be established by the Cooperative to enhance load management, to more efficiently utilize or conserve electric energy or to conduct load research.

Section 1.09. Nondiscrimination. Clark County Rural Electric Membership Corporation and its wholly owned subsidiary shall not discriminate due to race, color, creed, religion, sex, age, or national origin.

Article II. Membership Suspension & Termination

Section 2.01. Suspension; Reinstatement. Upon his failure, after the expiration of the initial time limit prescribed either in a specific notice to him or in the Cooperative's generally publicized applicable rules and regulations, to pay any amounts due the Cooperative or to cease any other noncompliance with his membership obligations, a person's membership shall automatically be suspended; and he shall not during such suspension be entitled to receive electric service from the Cooperative or to cast a vote at any meeting of the members.

Payment of all amounts due the Cooperative, including any additional charges required for such reinstatement, and/or cessation of any other noncompliance with his membership obligations within the final time limit provided in such notice or rules and regulations shall automatically reinstate the membership, in which event the member shall thereafter be entitled to receive electric service from the Cooperative and to vote at the meetings of its members.

Section 2.02. Termination by Expulsion; Renewed Membership. Upon failure of a suspended member to be automatically reinstated to membership, as provided in Section 2.01, he may, without further notice, but only after due hearing if such is requested by him, be expelled by resolution of the Board of Directors at any subsequently held regular or special meeting of the Board.

Any person so expelled may, by delivering written notice to that effect to the Cooperative at least 10 days prior to the next meeting of the members, appeal to and be present and heard at such meeting, which may vote approval of such expulsion or disapproval thereof, in which latter event such person's membership shall be reinstated retroactively to the date of his expulsion. After any finally effective expulsion of a member, he may not again become a member except upon new application therefor duly approved as provided in Section 1.05.

The Board of Directors, acting upon principles of general application in such cases, may establish such additional terms and conditions for renewed membership as it determines to be reasonably necessary to assure the applicant's compliance with all his membership obligations.

Section 2.03. Termination by Withdrawal or Resignation. A member may withdraw from membership upon such generally applicable conditions as the Board of Directors shall prescribe and upon either (a) ceasing to (or, with the approval of the Board of Directors, resigning his membership in favor of a new applicant who also shall) own or directly occupy or use all premises being furnished electric service pursuant to his membership, or (b) except when the Board of Directors specifically waives such condition, abandoning totally and permanently the use of central station electric service on such premises.

Section 2.04. Termination by Death or Cessation of Existence; Continuation of Membership in Remaining or New Partners. Except as provided in Section 2.06, the death of an individual human member shall automatically terminate his membership. The cessation of the legal existence of any other type of member shall automatically terminate such membership: PROVIDED, that upon the dissolution for any reason of a partnership, or upon the death, withdrawal or addition of any individual partner, such membership shall continue to be held by such remaining and/or new partner or partners as continue to own or directly to occupy or use the premises being furnished electric service pursuant to such membership in the same manner and to the same effect as though such membership had never been held by different partners: PROVIDED FURTHER, that neither withdrawing partner nor his estate shall be released from any debts then due the Cooperative.

Section 2.05. Effect of Termination. Upon termination in any manner of a person's membership, he or his estate, as the case may be, shall be entitled to a refund of his service security deposit, if any, theretofore paid the Cooperative, less any amounts due the Cooperative; but neither he nor his estate, as the case may be, shall be released from any debts or other obligations then remaining due the Cooperative.

Notwithstanding the suspension or expulsion of a member, as provided for in Sections 2.01 and 2.02, such suspension or expulsion shall not, unless the Board of Directors shall expressly so elect, constitute such release of such person from his membership obligations as to entitle him to purchase from any other person any central station electric power and energy for use at the premises to which such service has theretofore been furnished by the Cooperative pursuant to such membership.

Section 2.06. Effect of Death or Divorce upon a Joint Membership. Upon death of either spouse in a joint membership, such membership shall continue to be held solely by the survivor, in the same manner and to the same effect as though such membership had never been joint: PROVIDED, that the estate of the deceased spouse shall not be released from any debts due the Cooperative.

Upon the divorce of the holders of a joint membership, such membership shall continue to be held solely by the one who continues directly to occupy or use the premises covered by such membership in the same manner and to the same effect as though such membership had never been joint: PROVIDED, that the other spouse shall not be released from any debts due the Cooperative at the time of the separation or divorce.

A spouse shall promptly notify the Cooperative when he/she is divorced in order that the Cooperative shall know who will remain on the premises where the electricity is electricity supplied to the premises, and how to properly make capital credit distributions. Failure to so notify the Cooperative shall constitute a forfeiture of any claims or defenses of that person pertaining to capital credits, disconnection of service and obligation to pay the bills connected with the joint membership.

Section 2.07. Acceptance of Members Retroactively. Upon discovery that the Cooperative has been furnishing electric service to any person other than a member, it shall cease furnishing such service unless such person applies for, and is accepted for membership retroactively to the date on which such person first began receiving such service, in which event the Cooperative, to the extent practicable, shall correct its membership and all related records accordingly.

Article III. Meetings of Members

Section 3.01. Annual Meeting. For the purposes of electing directors, hearing and passing upon reports covering the previous calendar year, and transacting such other business as may properly come before the meeting, the annual meeting of the members shall be held in the month of March or April each year, or such other time as may be required by circumstances beyond the control of the Cooperative, and may be held at any convenient place in one of the counties in Indiana within which the Cooperative serves that is compliant with the Americans with Disabilities Act and able to accommodate the parking, square footage, technology and other needs of a business meeting for a large gathering of people. The annual meeting shall be called at such hour as the Board of Directors shall from year to year fix. Notwithstanding anything to the contrary set forth in this Section 3.01, the Board of Directors may for good cause:

  1. fix a different date for such annual meeting not more than 30 days prior or subsequent to the day otherwise established for such meeting in this Section, or
  2. cancel that portion of the annual meeting which involves a public gathering when cancellation is (1) determined by the Board of Directors or by a public health agency to be in the interest of public health, safety and welfare, or (2) required by a natural disaster, calamity or catastrophe, or (3) required or recommended by law enforcement agencies or other governing public authorities. In the event of such cancellation, early voting allowed under Section 3.05 shall serve as the annual meeting, no further business meeting is required, and early votes cast by the membership shall determine the outcome of the election for Director, so long as the total early votes cast meet the quorum requirements of these Bylaws.

In cases of emergency postponements, reschedules or cancellations, the members shall be notified by written, printed, visual and/or audible notice, or any combination thereof, whether by electronic transmission, video announcement, paper dissemination or other method. The notice requirements of Section 3.03 shall apply in non-emergency situations.

It shall be the responsibility of the Board of Directors to make adequate plans and preparations for, and to encourage member attendance at, the annual meeting. Failure to hold the annual meeting at the designated time and place shall not work a forfeiture or dissolution of the Cooperative.

Section 3.02. Special Meetings. A special meeting of the members may be called by the Board of Directors, by any 6 directors, or by petition signed by not less than 10% of the members, and it shall thereupon be the duty of the Secretary to cause notice of such meeting to be given as hereinafter provided in Section 3.03. Such a meeting shall be held at such place in one of the counties in Indiana within which the Cooperative serves, on such date, not sooner than 40 days after the call for such meeting is made or a petition therefor is filed, and beginning at such hour as shall be designated by him or those calling or petitioning for the same.

Section 3.03. Notice of Member Meetings. Written or printed notice, whether by electronic transmission, paper or otherwise, of the place, day and hour of the meeting and, in the case of a special meeting or of an annual meeting at which business requiring special notice is to be transacted, the purpose or purposes of the meeting shall be delivered to each member not less than 10 days nor more than 60 days prior to the date of the meeting, either personally or by mail, by or at the direction of the President or Secretary (and, in the case of a special meeting, at the direction of the President or Secretary or those calling the meeting).

Any notice delivered by mail may be included with member service billings or as an integral part of or with the Cooperative's monthly newsletter if, in either case, the notice is mailed in a sealed envelope. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail in a sealed envelope addressed to the member at the member's address as it appears on the records of the Cooperative, with postage thereon prepaid and postmarked at least 10 days prior to the meeting date. In making such computation, the date of the meeting shall not be counted.

All notices delivered by electronic transmission shall be deemed to be delivered when sent to the member at the member's email address as it appears on the records of the Cooperative.

The incidental and nonintended failure of any member to receive a notice shall not invalidate any action which may be taken by the members at any meeting or the outcome of any election for Director, and the attendance in person of a member at any meeting and casting a vote for Director prior to any meeting of the members shall constitute a waiver of notice of such meeting unless such attendance shall be for the express purpose of objecting to the transaction of any business, or one or more items of business, on the ground that the meeting shall not have been lawfully called, noticed or convened.

Any member attending any meeting for the purpose of making such objection shall notify the Secretary prior to or at the beginning of the meeting of his objection.

Section 3.04. Quorum. One-fiftieth of the total of all the Cooperative's members constitutes a quorum for the transaction of business at any membership meeting. PROVIDED, that early votes cast in the election of Directors prior to the in-person annual meeting, whether cast (a) by pre-annual-meeting paper ballot as may be allowed by the Board of Directors, (b) by mail, or (c) by electronic ballot added together with the in person votes cast in the election of Directors at the annual meeting shall count toward constituting a quorum after notice of the meeting is provided in accordance with Section 3.03. Except for early voting in elections for Directors at annual meetings as allowed in Section 3.01, all other business to be conducted at a membership meeting may be transacted only when: (a) a quorum has been constituted in person at the meeting, and (b) the membership has been given notice in accordance with Section 3.03 or as allowed under Section 3.01 of the business to be transacted. If less than 2% of the Cooperative's members are present in person at a membership meeting to conduct any business other than voting for Directors, a majority of those present may without further notice adjourn the meeting to another time and date not less than 40 days later and to any place in one of the counties in Indiana within which the Cooperative serves: PROVIDED, that the Secretary shall notify any absent members of the time, date, place and purpose of such adjourned meeting by delivering notice thereof as provided in Section 3.03.

Other than as provided Article III, Sections 3.01, 3.07 and the following paragraph of this Section 3.04 allowing for early voting and emergency cancellations of annual meetings and as provided in Article XI, Section 11.01 requiring a different quorum requirement of membership meeting to consider a buyout by a non REMC entity, 1/50 of all the members of the corporation present in person at any meeting of members, of which meeting notice shall be given as provided in Section 3.03 of this article, shall constitute a quorum for the transaction of business at such meeting. In the case of voting for Director, the presence of a quorum shall be determined by the number of votes possible, and by the number of votes cast as allowed in Section 3.05.

In the case of transacting other Cooperative business (for which the membership has been given proper notice), the presence of a quorum shall be determined by the number of votes possible, and by the number of members present at the meeting.

Section 3.05. Voting. Each member who is not in a status of suspension, as provided for in Section 2.01, shall be entitled to only one vote upon each matter submitted to a vote at any meeting of the members. Notwithstanding anything contained in the Bylaws that may be construed to the contrary, voting in elections for Directors may occur any time (a) after notice of the annual meeting is provided in accordance with Section 3.03 and (b) before the beginning of the business session at the annual meeting. The Board of Directors shall determine from year to year prior to sending notice of the annual meeting whether such early voting may be cast in person, by a written ballot, by electronic ballot, or by any combination thereof as allowed by law. The Board of Directors may engage the services of consultants or companies specialized in conducting corporate elections to count the ballots. All votes cast prior to the annual meeting as authorized by the Board of Directors shall count toward the quorum requirement of Section 3.04. The annual meeting notice to members shall inform the members of the voting process allowed for the annual meeting.

For purposes of this section, a member is defined as a natural person, firm, association, corporation, business trust, partnership, federal agency, state or political subdivision or agency thereof, or body politic which purchases electric power and energyfrom the Cooperative.

Voting by members other than members who are natural persons shall be allowed upon the presentation to the Cooperative, prior to or upon registration at each member meeting, of satisfactory evidence entitling the person presenting the same to vote.

Members may not cumulate their votes or vote by proxy.

A member is not eligible to cast a vote for Director until he/she/it has been a member for at least 45 days before voting in an election of Directors is open to the members. A member is not eligible to vote on other business until he/she/it has been a member for at least 45 days before the annual or special meeting at which the business is to be conducted by the membership.

Section 3.06. Credentials and Election Committee. The Board of Directors shall, at least 90 days before the annual meeting and at least 10 days before any other meeting of the members, appoint a Credentials and Election Committee. The Committee shall consist of an uneven number of members not less than 7 nor more than 21 who are not existing Cooperative employees, agents, officers, directors or known candidates for director, and who are not close relatives (as hereinafter defined in Section 4.14) or members of the same household of existing Cooperative employees, agents, officers, directors or known candidates for director. In appointing the Committee, the Board shall have regard for the equitable representation of the several areas served by the Cooperative.

The Committee shall elect its own chairman and secretary prior to the member meeting.

It shall be the responsibility of the Committee to pass upon all questions that may arise with respect to the registration of members in person, to rule upon the validity of petitions of nomination or the qualifications of candidates and the regularity of the nomination and election of directors, and to pass upon any protest or objection filed with respect to any election or to conduct affecting the results of any election.

In the exercise of its responsibility, the Committee shall have available to it the advice of counsel provided by the Cooperative.

In the event a protest, objection, or request for recount is filed concerning any election or ballot initiative, such protest, objection, or request for recount must be filed before the close of business on or before the fifth business day following the adjournment of the meeting in which the voting is conducted. The Committee shall thereupon be reconvened, upon notice from its chairman given within 10 business days after such protest, objection, or request for recount is filed.

If the difference in votes between the candidate with the most votes and either the next closest candidate or the candidate for whom the recount is requested is 5% or more of the total votes cast in the recounted election, no recount shall occur unless the person requesting the recount pays a deposit of $2,500 at the Cooperative headquarters before the close of business on or before the fifth business day following the adjournment of the meeting in which the voting was conducted. In the event that the recount overturns the results of the election, the deposit shall be refunded. In the event that the cost of the recount exceeds the amount of the deposit and the election is not overturned, the person requesting the recount shall pay all additional costs incurred by the Cooperative for the recount. The deposit shall apply toward the final cost of the recount. The same rules and deposit requirements shall apply for a requested recount of any ballot initiative.

The Committee shall hear such evidence as is presented by the protestor(s) or objector(s), who may be heard in person, by counsel, or both, and any opposing evidence; and the Committee, by a vote of a majority of those present and voting, shall, within a reasonable time but not later than 30 days after such hearing, render its decision, the result of which may be to affirm the election, to change the outcome thereof, or to set it aside. The Committee's decision (as reflected by a majority of those actually present and voting) on all matters covered by this Section shall be final.

The Committee may not affirmatively act on any matter unless a majority of the Committee is present.

Section 3.07. Order of Business. The order of business at the annual meeting of the members and, insofar as practicable or desirable, at all other meetings of the members shall be essentially as follows:

  1. Report on the existence of a quorum;
  2. Reading of proof of the notice of the meeting or of the waiver or waivers of notice of the meeting, as the case may be;
  3. Call for approval of draft minutes of previous meetings of the members and the taking of necessary action thereon. Action may be taken on minutes of previous meetings by a majority vote of the members actually present at the meeting;
  4. Discussion of unfinished business, however, no action may be taken on unfinished business without notice to the full membership;
  5. Discussion of new business, however, no action may be taken on new business without notice to the full membership;
  6. Announcement of election results; and
  7. Adjournment.

Notwithstanding the foregoing, the Board of Directors may from time to time establish a different order of business for the purpose of assuring the earlier consideration of and action upon any item of business the transaction of which is necessary or desirable in advance of any other item of business: PROVIDED, that no business other than adjournment of the meeting to another time and place may be transacted until and unless the existence of a quorum is first established. PROVIDED FURTHER, that any cancellation of the annual meeting under Section 3.01 of these Bylaws shall suspend the need to conduct a membership meeting for all business items stated herein. In the event of such cancellation the Board of Directors shall (a) determine whether the total number of early votes cast constitutes a quorum, (b) receive a certified report of the outcome of early voting, (c) declare the winning candidates for Director, and (d) cause notice of the election outcome to be given to the candidates and members.

Article IV. Directors

Section 4.01. Number and General Powers. The business and affairs of the Cooperative shall be managed by a Board of 7 Directors. The Board shall exercise all of the powers of the Cooperative except such as are by law or by the Cooperative's Articles of Incorporation or Bylaws conferred upon or reserved to the members.

Section 4.02. Qualifications. No person shall be eligible to become or remain a director of the Cooperative who is a close relative (as hereinafter defined in Section 4.14) of an employee of the Cooperative. Furthermore, no person shall serve as a director who is a close relative of an incumbent director if such service would cause both to be members of the Board at the same time. No person shall be eligible to become a director of the Cooperative if said person is or was an employee of the Cooperative within 3 years prior to the date of the directorate election. No person shall serve as a director who has been convicted of a serious felony crime of moral turpitude as defined in Section 4.08 below; and no person shall serve as a director who is not a member in good standing of the Cooperative and receiving service there from at his primary residential abode.

No member shall be eligible to become or remain a director or to hold any position of trust in the Cooperative, who has not been a bona fide member for one year prior thereto, and must have been a bona fide resident of the district in which he runs for 6 months prior to his election, and must remain a resident of that district during his term.

No person shall be eligible to become or remain a director of, or to hold any other position of trust in, the Cooperative who is not at least 18 years of age or is in any way employed by or financially interested in an enterprise which is in competition with the Cooperative or with its subsidiary, or selling supplies or services in significant amounts to the Cooperative or its subsidiary unless such supplies or services cannot reasonably be secured elsewhere. In such circumstances, full disclosure shall be made to the board and membership prior to election or re-election to the board.

No person shall be eligible to become or remain a director if that person has a conflict of interest with the Cooperative. A lawsuit which seeks monetary damages against the cooperative is a conflict of interest.

When a membership is held jointly by a husband and wife either one, but not both, may be elected a director, provided, however, that neither one shall be eligible to become or remain a director or to hold a position of trust in the Cooperative unless both shall meet the qualifications hereinabove in this section set forth.

Upon establishment of the fact that a nominee for director lacks eligibility under this Section or as may be provided elsewhere in these Bylaws, it shall be the duty of the chairman presiding at the meeting at which such nominee would otherwise be voted upon to disqualify such nominee.

Upon the establishment of the fact that any person being considered for, or already holding, a directorship or other position of trust in the Cooperative lacks eligibility under this Section, it shall be the duty of the Board of Directors to withhold such position from such person, or to cause him to be removed therefrom, as the case may be. Nothing contained in this Section shall, or shall be construed to, affect in any manner whatsoever the validity of any action taken at any meeting of the Board of Directors, unless such action is taken with respect to a matter which is affected by the provisions of this Section and in which one or more of the directors have an interest adverse to that of the Cooperative.

Section 4.03. Election. At each annual meeting of the members, directors shall be elected by secret ballot by the members. Directors shall be elected by a plurality of the votes cast in accordance with Section 3.05.

Section 4.04. Tenure. Directors shall be so nominated and elected that one director from or with respect to each of Directorate Districts Nos. 1 and 2 shall be elected for 3-year terms at an annual member meeting; one director from or with respect to each of Directorate Districts Nos. 4 and 5 shall be elected for 3-year terms at the next succeeding annual member meeting; and one director from or with respect to each of Directorate Districts, Nos. 3, 6, and 7 shall be elected for 3-year terms at the next succeeding annual member meeting, and so forth.

Upon their election, directors shall, subject to the provisions of these Bylaws with respect to the removal of directors, serve until the annual meeting of the members of the year in which their terms expire or until their successors shall have been elected and shall have qualified.

If for any reason an election of directors shall not be held at an annual meeting of the members duly fixed and called pursuant to these Bylaws, such election may be held at an adjournment of such meeting or at a subsequently held special or the next annual meeting of the members.

Failure of an election for a given year shall allow the incumbents whose directorships would have been voted on to hold over only until the next member meeting at which a quorum is present.

Section 4.05. Seven Directorate Districts. The territory served by the Cooperative shall be divided into 7 Directorate Districts. Each District shall be represented by 1 director, and the Districts are described as follows:

Directorate District No. Description Number of Directors
1 Vienna, Lexington, and Johnson Townships in Scott County; Saluda Township in Jefferson County; and Washington, Bethlehem and Owen Townships in Clark County 1
2 Oregon and Charlestown Townships in Clark County 1
3 Monroe and Wood Townships in Clark County and  Polk Township in Washington County 1
4 Carr and Union Townships in Clark County 1
5 Lafayette and New Albany Townships in Floyd County 1
6 Silver Creek Township in Clark County 1
7 Utica and Jeffersonville Townships in Clark County  1

All eligible voting members, regardless of residence or location within the territory, may vote for his/her candidate of choice for director in all Districts as such Director elections occur; however, a candidate for director must meet the residency requirements and live in the Directorate District for which he/she seeks office.

Every year the Board of Directors, not less than 90 days prior to the earliest date on which the annual member meeting may be held, shall review the Districts and, if determining that they should be altered so as to correct any substantially inequitable factors regarding the residence of members, the proportionate membership population sizes of the Districts, or the geographic location of Districts, and/or the number of directors to be elected from or with respect to such Districts, shall change and re-describe one or more Districts and/or the number of directors to be elected from or with respect to such Districts accordingly, in which event all Districts as so changed shall be noticed in writing to the members prior to the start of the director candidate petitioning process.

After such notice, these Bylaws shall have been effectively amended accordingly: PROVIDED that no such change shall be so effectuated by the Board as to compel the vacancy of any director's office prior to the time such director's term would normally expire unless such director consents thereto in writing.

Section 4.06. Nominations. A member may be nominated to be a candidate to run for election for a director position that is scheduled for election at the annual membership meeting by a written petition signed by a minimum of 15 members. All such petitions must be delivered in person inside the Cooperative headquarters and date and time stamped during regular business hours at least 90 calendar days before the annual meeting. In the event that the ninetieth day falls on a weekend, an REMC-observed holiday or other day when the headquarters is closed for any reason, the deadline for submitting petitions shall end when the office closes on the next regular business day. The signed petition must include all of the following:

  1. A listing on each page of the petition of the name of the member who is being nominated;
  2. A listing on each page of the petition of the district number of the district from which the nominee will run;
  3. The legible printed names, addresses, and telephone numbers of each member signing the petition;
  4. The original signatures in ink of each member signing the petition, each such signature to be made in the same location of the petition where the printed name, address, and telephone number of that person is located.Only members may sign a petition to nominate.The signature of either or both persons who hold a joint membership shall count as one signature on a petition to nominate.

Only one authorized signature per member firm, association, corporation, business trust, partnership, federal agency, state or political subdivision or agency thereof, or body politic (collectively "Organization Member") may be counted on a petition to nominate. The petition to nominate must be accompanied by written proof that the person who signs on behalf of the Organization Member is authorized to sign on behalf of the Organization Member.

After verifying that a petition to nominate complies with this Bylaw, the Cooperative shall post and display at the principal office of the Cooperative at least 30 days prior to the meeting a list of nominations for directors to be elected, listing separately the nominee(s) for each Directorate District.

In the event that no nominations are made for a Director District for a director position that is scheduled for election at the upcoming annual membership meeting, the open seat shall be treated as a vacancy under Section 4.09 of these Bylaws.

Section 4.07. Voting for Directors; Validity of Board Action. In the election of directors, each member shall be entitled to cast the number of votes (but not cumulatively) which corresponds to the total number of directors to be elected, but no member may vote for more nominees than the number of directors that are to be elected from or with respect to any particular Directorate District.

Ballots marked in violation of the foregoing restriction with respect to one or more Directorate Districts shall be invalid and shall not be counted with respect to such District or Districts.

Notwithstanding the provisions contained in this Section, failure to comply with any of such provisions shall not affect in any manner whatsoever the validity of any action taken by the Board of Directors after the election of directors.

Section 4.08. Removal of Directors.

A. Removal By Members. Any member may bring one or more charges for cause against any one or more directors and may request the removal of such director(s) by reason thereof by filing with the Secretary such charge(s) in writing together with a petition signed by not less than 5% of the total membership of the Cooperative, which petition calls for a special member meeting, the stated purpose of which shall be to hear and act on such charges and, if one or more directors are recalled, to elect their successor(s) and specifies the place, time and date thereof not less than 40 days after filing of such petition, or which requests that the matter be acted upon at the subsequent annual member meeting if such meeting will be held no sooner than 40 days after the filing of such petition.

Each page of the petition shall, in the forepart thereof, state the name(s) and address(es) of the member(s) filing such charge(s), a verbatim statement of such charge(s) and the name(s) of the director(s) against whom such charge(s) is(are) being made.

The petition shall be signed by each member in the same name as he is billed by the Cooperative and shall state the signatory's address as the same appears on such billings.

Notice of such charge(s) verbatim, of the director(s) against whom the charge(s) have been made, of the member(s) filing the charge(s) and the purpose of the meeting shall be contained in the notice of the meeting, or separately noticed to the members not less than 10 days prior to the member meeting at which the matter will be acted upon: PROVIDED, that the notice shall set forth only 20 of the names (in alphabetical order) of the members filing one or more charges if 20 or more members file the same charge(s) against the same director(s).

Such director(s) shall be informed in writing of the charges after they have been validly filed and at least 20 days prior to the meeting of the members at which the charge(s) are to be considered, and shall have an opportunity at the meeting to be heard in person, by witnesses, by counsel or any combination of such, and to present evidence in respect of the charge(s); and the person(s) bringing the charge(s) shall have the same opportunity, but must be heard first.

The question of the removal of director(s) shall, separately for each if more than one has been charged, be considered and voted upon at such meeting, and any vacancy created by such removal shall be filled by vote of the members at such meeting without compliance with the foregoing provisions with respect to nominations, except that nominations shall be made from the floor: PROVIDED, that the question of the removal of a director shall not be voted upon at all unless some evidence in support of the charge(s) against him shall have been presented during the meeting through oral statements, documents or otherwise. Provided further that the exercise of judgment shall not be grounds for removal.

A newly elected director shall be from or with respect to the same Directorate District as was the director whose office he succeeds shall meet all other qualifications for a director and shall serve the unexpired portion of the removed director's term.

B. Removal By Board of Directors. Cause for Removal of Director by the Board. A Director may only be removed by the Board for Cause which shall be determined pursuant to the Procedure for Removal by Board. Cause for Removal means any of the following:

  1. Commission by a Director of a felony crime of moral turpitude. "Crime of moral turpitude" as used in this section shall be defined as sex crimes, crimes of dishonesty and other crimes which are contrary to justice, honesty, modesty, and/or good morals. The Board of Directors, after having followed the procedure for removal set forth below, by a vote of three-fourths of the Directors may terminate or remove a director when there is compelling evidence that the said director has committed an act that would constitute a felony crime of moral turpitude regardless of whether the director has been convicted of same.
  2. Three absences from regularly scheduled Board Meetings in twelve consecutive months when such absences are not related to Cooperative business.
  3. A Director's improper use of Cooperative funds.
  4. Failure to serve in accordance with, or overt violation of, any material term, condition, or provision of the Cooperative's Articles of Incorporation, Bylaws, Code of Conduct, Regulations, Governance policies or other policies.

Procedure for Removal by Board. Any Director may request the removal of another Director for Cause by delivering to each member of the Board of Directors a notice, signed by at least two members of the Board, setting forth the grounds for cause for removal against such Director. The Director against whom the charges are brought shall be informed in writing of the charges at least ten days prior to the meeting of the Board. This meeting shall be presided over by the Board President unless he/she is the charged party in which case the presiding officer shall be the Vice President and on down the order of officers and chain of command as the case may be. At such Board meeting and in the presence of the Director charged, the person or persons bringing the charges shall present evidence in support of removal. The Director charged shall be heard in person and/or by counsel and shall have an opportunity to present evidence in support of his/her defense to the charges and against removal. The Board member may be removed only if by a 3/4 majority of the entire Board, less the member charged, the Board finds by clear and convincing evidence: (1) that Cause was established; and, (2) that the Cause established had, has or could have a material adverse effect on the business and affairs of the Cooperative.

Section 4.09. Vacancies. Subject to the provisions of these Bylaws with respect to the filling of vacancies caused by the removal of directors by the members, a vacancy occurring in the Board of Directors shall be filled by the Board of Directors.

A director thus elected shall serve out the unexpired term of the director whose office was originally vacated and until a successor is elected and qualified: PROVIDED, that such a director shall be from or with respect to the same Directorate District as was the director whose office was vacated.

SECTION 4.10. Compensation; Expenses. Directors shall, as determined by a resolution of the Board of Directors, receive on a per diem basis a fixed fee, which may include insurance benefits, (a) for attending meeting of the Board of Directors and (b) for the performance of other director duties when such has had prior approval of the Board of Directors. The fee fixed for (a) foregoing need not be the fee or fees fixed for (b) foregoing.

Directors shall also receive advancement or reimbursement of and travel out-ofpocket expenses actually, necessarily and reasonably incurred in attending such meetings and performing such duties.

No director shall receive compensation for serving the Cooperative in any other capacity, nor shall any close relative of a director receive compensation for serving the Cooperative, unless the payment and amount of such compensation shall be specifically authorized by a vote of the members or such payment and amount shall be specifically authorized by the Board of Directors upon their certification of such as an emergency measure.

Section 4.11. Rules, Regulations, Rate Schedules and Contracts. The Board of Directors shall have power to make, adopt, amend, abolish and promulgate such rules, regulations, rate schedules, contracts, security deposits and any other types of deposits, payments or charges, including contributions in aid of construction, not inconsistent with law or the Cooperative's Articles of Incorporation or Bylaws, as it may deem advisable for the management, administration and regulation of the business and affairs of the Cooperative.

Section 4.12. Accounting System and Reports. The Board of Directors shall cause to be established and maintained a complete accounting system of the Cooperative's financial operations and condition, and shall, after the close of each calendar year, cause to be made a full, complete and independent audit of the Cooperative's accounts, books and records reflecting financial operations during, and financial condition as of the end of, such year. The Board may authorize special audits, complete or partial, at any time and for any specified period of time.

Section 4.13. Subscription to Cooperative's Newsletter; Subscription to Statewide Publication. For the purpose of disseminating information devoted to the economical, effective and conservative use of electric energy, the Board of Directors may, on behalf of and for circulation to the members periodically, to subscribe to the Cooperative's newsletter, "Connections," or its successor. The Board of Directors may, on behalf of and for circulation to the members periodically, to subscribe to the statewide publication, "Electric Consumer," or its successor.

Section 4.14. "Close Relative" Defined. As used in these bylaws, "close relative" means an individual who: through blood, law, or marriage, is a spouse, child, stepchild, father, stepfather, mother, stepmother, brother, stepbrother, half-brother, sister, stepsister, half-sister, grandparent, grandchild, aunt, uncle, niece, nephew, first cousin, father-in-law, mother-in-law, brother-in-law, sister-in-law, son-in-law, daughter-in-law, aunt by marriage, uncle by marriage, niece by marriage, nephew by marriage or first cousin-in-law; or resides in the same residence (collectively, "close relative").

An individual qualified and elected, designated, or appointed to a position does not become a close relative while serving in the position because of a marriage or legal action to which the individual was not a party.

Article V. Meetings of Directors

Section 5.01. Regular Meetings. A regular meeting of the Board of Directors shall be held, without notice, immediately after the adjournment of the annual meeting of the members, or as soon thereafter as conveniently may be, at such site as designated by the Board in advance of the annual member meeting.

A regular meeting of the Board of Directors shall also be held monthly at such date, time and place in one of the counties in Indiana within which the Cooperative serves as the Board shall provide by resolution. Such regular monthly meeting may be held without notice other than such resolution fixing the date, time and place thereof, except when business to be transacted thereat shall require special notice: PROVIDED, that the President of Board or any 3 Directors may cancel a monthly meeting in cases of emergency as declared by the President or any 3 Directors; AND PROVIDED FURTHER, that any director absent from any meeting of the Board at which such a resolution initially determines or makes any change in the date, time or place of a regular meeting shall be entitled to receive written notice of such determination or change at least 5 days prior to the next meeting of the Board; AND PROVIDED FURTHER, that, if a policy therefor is established by the Board, the President may change the date, time or place of a regular monthly meeting for good cause and upon not less than 5 days' notice thereof to all directors.

Regular meetings, upon proper notice as otherwise provided herein, may also be held via telephone conference call, without regard to the actual location of the directors at the time of such a telephone conference meeting, if all the directors consent thereto.

Section 5.02. Special Meetings except other than Article XI. Special meetings of the Board of Directors may be called by Board resolution, or by any 3 directors, and it shall thereupon be the duty of the Secretary to cause notice of such meeting to be given as hereinafter provided in Section 5.03.

The Board, the President, or the directors calling the meeting shall fix the date, time and place for the meeting, which shall be held in one of the counties in Indiana within which the Cooperative serves, unless all directors consent to its being held in some other place in Indiana or elsewhere.

Special meetings, upon proper notice as otherwise provided herein, may also be held via telephone conference call, without regard to the actual location of the directors at the time of such a telephone conference meeting, if all the directors consent thereto.

Section 5.03. Notice of Directors Meetings. Written notice of the date, time, place ( or telephone conference call) and purpose or purposes of any special meeting of the Board and, when the business to be transacted thereat shall require such, of any regular meeting of the Board shall be delivered to each director not less than 5 days prior thereto, either personally or by mail, by or at the direction of the Secretary or, upon a default in this duty by the Secretary, by him or those calling it in the case of a special meeting or by any director in the case of a meeting whose date, time and place have already been fixed by Board resolution.

If mailed, such notice shall be deemed to be delivered when deposited in the United States mail, addressed to the director at his address as it appears on the records of the Cooperative, with first class postage thereon prepaid, and postmarked at least five (5) days prior to the meeting date.

The attendance of a director at any meeting of the Board shall constitute a waiver of notice of such meeting unless such attendance shall be for the express purpose of objecting to the transaction of any business, or of one or more items of business, on the ground that the meeting shall not have been lawfully called or convened.

Section 5.04. Quorum. Other than Article XI, dealing with the sale of all or substantially all of the assets of the corporation which requires affirmative vote of the board of 2/3, 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 those present at said meeting 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.

The act of a majority of the board members present at a meeting at which a quorum is present shall be the act of the board, except as otherwise provided in these bylaws, and specifically, as provided in Article XI, dealing with the sale of all or substantially all of the assets of the corporation.

Article VI. Officers;Miscellaneous

Section 6.01. Number and Title. The officers of the Cooperative shall be a President, Vice President, Secretary and Treasurer, and such other officers as may from time to time be determined by the Board of Directors. The offices of Secretary and Treasurer may be held by the same person.

Section 6.02. Election and Term of Office. The 4 officers named in Section 6.01 shall be elected as follows: at the first meeting of the Board of Directors held after the annual meeting of the members, open nominations shall be made for each office and after nominations have been closed the Directors shall vote for each office by secret ballot, unless secret ballot is unanimously waived.

Officers must be elected by a majority of those Directors in attendance at such meeting. If the election of such officers shall not be held at such meeting, it shall be held as soon thereafter as may be convenient.

Each such officer shall hold office until the meeting of the Board first held after the next succeeding annual meeting of the members or until his successor shall have been duly elected and shall have qualified, subject to the provisions of the Bylaws with respect to the removal of directors and to the removal of officers by the Board of Directors.

Any other officers may be elected by the Board from among such persons, and with such title, tenure, responsibilities and authorities, as the Board of Directors may from time to time deem advisable.

The offices may be held by any director for as many terms as elected by the Board. However, in no event shall the President, Vice President or Secretary-Treasurer serve more than 4 consecutive 1-year terms plus the remaining portion of any unexpired term filled by appointment.

Section 6.03. Removal. Any officer, agent, or employee elected or appointed by the Board of Directors may be removed by the Board whenever in its judgment the best interests of the Cooperative will thereby be served.

Section 6.04. Vacancies. A vacancy in any office elected or appointed by the Board of Directors shall be filled by the Board for the unexpired portion of the term.

Section 6.05. President. The President shall --

  1. be the principal executive officer of the Cooperative and shall preside at all meetings of the Board of Directors, and, unless determined otherwise by the Board of Directors, at all meetings of the members;
  2. sign, with the Secretary, any deeds, mortgages, deeds of trust, notes, bonds, contracts or other instruments authorized by the Board of Directors to be executed, except in cases in which the signing and execution thereof shall be expressly delegated by the Board of Directors 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 of Directors from time to time.

Section 6.06. Vice President. In the absence of the President, or in the event of his inability or refusal to act, the Vice President shall perform the duties of the President, and, when so acting, shall have all the powers of and be subject to all the restrictions upon the President; and shall perform such other duties as from time to time may be assigned to him by the Board of Directors.

Section 6.07. Secretary. The Secretary shall --

  1. keep, or cause to be kept, the minutes of meetings of the members and of the Board of Directors in one or more books provided for that purpose;
  2. see that all notices are duly given in accordance with these Bylaws or as required by law;
  3. be custodian of the corporate records and of the seal of the Cooperative and that the seal of the Cooperative is affixed 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 or is required by law;
  4. keep, or cause to be kept, a register of the name and post office address of each member, which address shall be furnished to the Cooperative by such member;
  5. have general charge of the books of the Cooperative in which a record of the members is kept;
  6. keep on file at all times a complete copy of the Cooperative's Articles of Incorporation and Bylaws, together with all amendments thereto, which copies shall always be open to the inspection of any member, and, at the expense of the Cooperative, furnish a copy of such documents and of all amendments thereto upon request to any member; and
  7. in general, perform all duties incident to the office of the Secretary and such other duties as from time to time may be assigned to him by the Board of Directors.

Section 6.08. Treasurer. The Treasurer shall --

  1. have charge and custody of and be responsible for all funds and securities of the Cooperative;
  2. receive and give receipts for moneys due and payable to the Cooperative from any source whatsoever, and deposit or invest all such moneys in the name of the Cooperative in such bank or banks or in such financial institutions or securities as shall be selected in accordance with the provisions of these Bylaws; and
  3. in general, perform all the duties incident as from time to time may be assigned to him by the Board of Directors.

Section 6.09. Delegation of Secretary's and Treasurer's Responsibilities. Notwithstanding the duties, responsibilities and authorities of the Secretary and of the Treasurer herein before provided in Section 6.07 and 6.08, the Board of Directors by resolution may, except as otherwise limited by law, delegate, wholly or in part, the responsibility and authority for, and the regular or routine administration of, one or more of each such officer's such duties to one or more agents, other officers or employees of the Cooperative who are not directors. To the extent that the Board does so delegate with respect to any such officer, that officer as such shall be released from such duties, responsibilities and authorities.

Section 6.10. Chief Executive Officer. The Board of Directors may appoint a Chief Executive Officer, who may be, but who shall not be required to be, a member of the Cooperative. Such officer shall perform such duties as the Board of Directors may from time to time require and shall have such authority as the Board of Directors may from time to time vest in him.

Section 6.11. Bonds. The Board of Directors shall require the Treasurer and any other officer, agent or employee of the Cooperative charged with responsibility for the custody of any of its funds or property to give bond in such sum and with such surety as the Board of Directors shall determine.

The Board of Directors in its discretion may also require any other officer, agent or employee of the Cooperative to give bond in such amount and with such surety as it shall determine. The costs of all such bonds shall be borne by the Cooperative.

Section 6.12. Compensation; Indemnification. The compensation, if any, of any officer, agent or employee who is also a director or close relative of a director shall be determined as provided in Section 4.10 of these Bylaws, and the powers, duties and compensation of any other officers, agents and employees shall be fixed or a plan therefor approved by the Board of Directors.

The Cooperative shall indemnify directors, officers, including the Chief Executive Officer, agents and employees against liability to the extent that their acts or omissions constituting the grounds for alleged liability were performed in their official capacity and, if actionable at all, were based upon good faith business judgments in the belief the acts or omissions were in the best interests of the Cooperative or were not against the best interest of the Cooperative. The Cooperative may purchase insurance to cover such indemnification.

Section 6.13. 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 calendar year and showing the financial condition of the Cooperative at the close of such calendar year. If the annual meeting is cancelled under Section 3.01, such reports shall be sent to the members by first class mail, sufficient postage prepaid and by posting same on the Cooperative's website.

Article VII. Contracts, Checks, & Deposits

Section 7.01. Contracts. Except as otherwise provided by law or these Bylaws, the Board of Directors may authorize any Cooperative officer, agent or employee to enter into any contract or execute and deliver any instrument in the name and on behalf of the Cooperative, and such authority may be general or confined to specific instances.

Section 7.02. Checks, Drafts, etc. All checks, drafts or other orders for the payment of money, and all notes, bonds or other evidences of indebtedness, issued in the name of the Cooperative, shall be signed or countersigned by such officer, agent or employee of the Cooperative and in such manner as shall from time to time be determined by resolution of the Board of Directors.

Section 7.03. Deposits; Investments. All funds of the Cooperative shall be deposited or invested from time to time to the credit of the Cooperative in such bank or banks or in such financial securities or institutions as the Board of Directors may select.

Article VIII. Cooperative Operation

Section 8.01. Nonprofit and Cooperative Operation. The Cooperative: (1) shall operate on a nonprofit and cooperative basis for the mutual benefit of all Members; and (2) may not pay interest or dividends on capital furnished by Patrons.

Section 8.02. Allocation of Capital Credits. The Cooperative shall allocate Capital Credits as provided in this Bylaw. The Cooperative must allocate Capital Credits in a patron's name as shown in the Cooperative's records, regardless of the patron's marital status.

  1. Patron. The term "patron" means, during a fiscal year, either: (1) a member of the Cooperative, or (2) any other individual or entity purchasing a good or service from the cooperative to whom the Cooperative has a pre-existing legal obligation to allocate capital credits.
  2. Allocating Earnings. For each good or service provided by the Cooperative on a cooperative basis during a fiscal year, the Cooperative shall equitably allocate to each patron, in proportion to the quantity or value of the good or service purchased by the patron during the fiscal year and timely paid for by the patron, the Cooperative's patronage earnings from providing the good or service during the fiscal year, which is the amount by which the Cooperative's patronage sourced revenues from providing the good or service exceed the Cooperative' s patronage sourced expenses of providing the good or service, all as determined under federal cooperative tax law. If the Cooperative's patronage sourced expenses of providing the good or service during the fiscal year exceed the Cooperative's patronage sourced revenues from providing the good or service during the fiscal year, all as determined under federal cooperative tax law, then the Cooperative shall: (1) allocate this patronage loss to each patron in proportion to the quantity or value of the good or service purchased by the patron during the fiscal year, (2) offset this patronage loss with the Cooperative's patronage earnings from providing the good or service during the most recent past fiscal year(s) or the next succeeding future fiscal year(s); or (3) offset this patronage loss first with the Cooperative's nonpatronage earnings during the current fiscal year, second with the Cooperative's unallocated nonpatronage earnings during any past fiscal year(s), and third with the Cooperative's nonpatronage earnings during any future fiscal year(s).

As determined by the Board, the Cooperative may use, retain, or equitably allocate the Cooperative's nonpatronage earnings, if any, which is the amount by which the Cooperative's nonpatronage sourced revenues during a fiscal year exceed the Cooperative's nonpatronage sourced expenses during the fiscal year, less any amount needed to offset a patronage loss.

For each amount allocated to a patron, the patron shall contribute a corresponding amount to the Cooperative as capital. The Cooperative shall credit all capital contributions from a patron to a capital account for the patron. The Cooperative shall maintain books and records reflecting the capital contributed by each patron. At the time of receipt by the Cooperative, each capital contribution will be treated as though the Cooperative paid the allocated amount to the patron in cash pursuant to a pre-existing legal obligation and the patron contributed the corresponding amount to the Cooperative as capital. The term "capital credit" means the amounts allocated to a patron and contributed by the patron to the Cooperative as capital.

Consistent with this bylaw, the allocation of capital credits is in the discretion of the Board and the Board shall determine the manner, method, and timing of allocating capital credits. As reasonable and fair, the Cooperative may allocate capital credits to classes of similarly situated patrons under different manners, methods, and timing, provided the Cooperative allocates capital credits to similarly situated patrons under the same manner, method, and timing. The Cooperative may use or invest unretired capital credits as determined by the Board.

If the Cooperative is a member, patron, or owner of an entity from which the Cooperative purchases a good or service used by the Cooperative in providing a good or service and from which the Cooperative is allocated a capital credit or similar amount, then, as determined by the Board and consistent with this bylaw, the Cooperative may separately identify and allocate to the Cooperative's patrons this capital credits or similar amount allocated by the entity.

Upon the Cooperative receiving written notice and sufficient proof of the death of a spouse in a joint membership, the Cooperative shall assign and transfer to the surviving spouse the capital credits allocated, or to be allocated, to the joint membership. Upon the Cooperative receiving written notice and sufficient proof of the dissolution of marriage between spouses in a joint membership, and unless otherwise instructed by a court or administrative body of competent jurisdiction, the Cooperative may assign and transfer to each spouse 1/2 of the capital credits allocated to the joint membership.

Section 8.03. Notification and Assignment of Capital Credits. Within a reasonable time following the end of each fiscal year, the Cooperative may, but is not required to, notify each patron in writing of the stated dollar amount of capital credits allocated to the patron for the preceding fiscal year, PROVIDED, HOWEVER, that individual notices of such amounts furnished by each natural person shall not be required if the Cooperative notifies all patrons of the aggregate amount of such excess and provides a clear explanation of how each patron may compute and determine for himself the specific amount of capital so credited. Unless the Board determines otherwise, and unless these bylaws provide otherwise, the Cooperative may assign or transfer a patron's capital credits only if: (1) the Cooperative receives a written request signed by the patron to assign or transfer the capital credits, (2) the patron and the assignee or transferee comply with all reasonable requirements specified by the Cooperative, and (3) the Board approves the assignment or transfer.

Section 8.04. Retirement of Capital Credits. At any time before the Cooperative's dissolution, liquidation, or other cessation of existence, the Cooperative may generally retire and pay some or all capital credits allocated to patrons and former patrons. Any retirements of capital furnished prior to November 30, 1987, shall be made in order of priority according to the year in which the capital was furnished and credited, the capital first received by the Cooperative being first retired.

If the Cooperative separately identified and allocated capital credits representing capital credits or similar amounts allocated to the Cooperative by an entity in which the Cooperative is or was a member, patron, or owner, then the Cooperative shall retire and pay these capital credits before or after the entity retires and pays the capital credits or similar amounts to the Cooperative.

After retiring capital credits allocated to a patron or former patron, the Cooperative may recoup, offset, or set-off any amount owed to the Cooperative by the patron or former patron, including any compounded interest and late payment fee, by reducing the amount of retired capital credits paid to the patron or former patron by the amount owed.

The Cooperative may retire and pay capital credits only if the Board determines that the retirement and payment will not adversely impact the Cooperative's financial condition. Consistent with this bylaw, the retirement and payment of capital credits are in the discretion of the Board and the Board shall determine the manner, method, and timing of retiring and paying capital credits. As reasonable and fair, the Cooperative may retire and pay capital credits to classes of similarly situated patrons under different manners, methods, and timing, provided the Cooperative retires and pays capital credits to similarly situated patrons under the same manner, method, and timing.

The Cooperative may regularly impose a reasonable dormancy or service charge for each year a patron or former patron fails to claim capital credits retired and paid to the patron or former patron. Through a voluntary written assignment signed by a patron or former patron, which assignment is revocable and is not a condition of the Cooperative providing a good or service to the patron, the patron or former patron may assign or transfer to the Cooperative any past, present, or future capital credits retired and paid to the patron or former patron, but not claimed by the patron or former patron within 2 years of retirement and payment, provided the Cooperative undertook or undertakes reasonable measures to notify the patron or former patron of the retired and paid capital credits.

Section 8.05. Retirement of Discounted Capital Credits to Decedent's Estates. Upon the death of an individual patron or former patron, upon receiving a written request from the deceased individual's legal representative, and under terms and conditions agreed upon by the Cooperative and the deceased individual's legal representative, the Cooperative may specially retire some or all capital credits allocated to the individual, however, same shall be discounted for time value of money. So long as allowed by Indiana law, all such legal representatives who are not officially appointed as the personal representative of the decedent's estate shall be required to execute an affidavit releasing the Cooperative of liability consistent with Indiana Code 29-1-8, as amended. The remaining balance of the discounted capital credit shall be recorded as permanent equity on the books and records of the Cooperative and shall not be retired except in the case of dissolution.

Section 8.06. No Special Retirement of Capital Credits for Entities. Upon the dissolution, liquidation, or other cessation of existence of an entity patron or former patron, the Cooperative may not specially retire and pay capital credits allocated to the former entity. Upon the reorganization, merger, or consolidation of an entity patron or former patron, the Cooperative may not specially retire and pay capital credits allocated to the entity.

Article IX. Unclaimed Funds of Members

Any provisions contained herein to the contrary notwithstanding and pursuant to the applicable statutes of the State of Indiana, the Cooperative shall recover any capital credits, patronage refunds, utility deposits, membership fees, account balances, or book equity which remain unclaimed for a period of 2 years following attempted payment by the Cooperative to the member or former member entitled thereto.

Prior to the recovery of such unclaimed funds, the Cooperative shall give public notice, in a newspaper published in the county in which the present or former member's premises are or were being served by the Cooperative, of the name of each member or former member entitled to claim such funds, the approximate amount thereof, and the fact that, if not duly claimed at the office of the Cooperative within 60 days of the notice, such funds shall be forfeited to the Cooperative and reallocated for distribution among the other members of the Cooperative. Thereafter, any such unclaimed funds shall be allocated on a pro rata basis among the members of the Cooperative as of the year in which the 60th day falls following publication of the above described notice.

All unclaimed funds recovered by the Cooperative and reallocated as set forth hereinabove shall be considered an irrevocable assignment and gift to the Cooperative of such funds by the member formerly entitled thereto.

Nothing contained in this section shall be construed to prohibit the Cooperative from crediting any of the above described funds against any amounts owed by the member or former member to the Cooperative prior to any payment to such member or any allocation in favor of other members.

Article X. Waiver of Notice

Any member or director may waive, in writing, any notice of meetings required to be given by these Bylaws or any notice that may otherwise be legally required, either before or after such notice is required to be given.

Article XI. Disposition & Pledging of Property; Distribution of Surplus Assets on Dissolution

Section 11.01. Disposition and Pledging of Property. The Cooperative may not sell, lease, exchange, mortgage, pledge, or otherwise dispose of all or substantially all of the property of the Cooperative unless the following conditions and/or requirements have been met:

  1. A tendered offer must be made first to the Board of Directors.
  2. 2/3 of all directors must affirmatively authorize the submission of a tendered offer to the membership.
  3. The tendered offer must be for the entire system. Any tendered offer for the transfer of assets may NOT be considered for a portion of the system.
  4. No transfer of all or substantially all the assets may be considered, which is nothing more than an assignment of large segments of the assigned service area, unless the sale or the assignment of all the territory and the sale of all the assets proposed.
  5. Notwithstanding any article, bylaw, policy resolution or practice that has ever been utilized by this corporation to the contrary, neither proxy votes, telephone conferencing, write-in votes, nor absentee ballots may be utilized to establish a quorum for either the Board of Directors or the membership, nor for consideration or for counting in any voting of the Board of Directors, or the membership in any consideration of the transfer of all or substantially all of its property.
  6. No offer for the purchase of all or substantially all the assets the corporation may be considered if it does not include an assumption of all contractual obligations of the corporation, specifically including, but not limited to, the then existing total power requirements contract the corporation has with Hoosier Energy Rural Electric Cooperative, Inc. and all terms and conditions contained therein.
  7. No offer for the purchase of all or substantially all the assets of the corporation may be considered unless there have been 3 separate written appraisals from 3 independent, non-affiliated appraisers, expert in such matters, rendering opinions as to the value of the Cooperative with respect to such a sale, lease, lease-sale, exchange, transfer or other disposition and as to any other terms and conditions which should be considered. The 3 appraisers shall be designated by the Judge of the Circuit Court for the Judicial District in Indiana in which the Cooperative's headquarters are located. If such judge refuses or otherwise declines to make such designations, they shall be made by the Board of Directors.
  8. The Board of Directors shall first give every other rural electric cooperative corporately sited and operating in Indiana (which has not made such an offer for the sale, lease, lease-sale, exchange, transfer or other disposition) an opportunity to submit competing proposals before any tendered offer can be considered by the membership. Such opportunity to submit competing proposals shall be in the form of a written notice to such rural electric cooperatives, which notice shall be attached to a copy of the proposal which the Cooperative has already received and copies of the respective reports of the 3 appraisers. Such rural electric cooperatives shall be given not less than 45 days during which to submit competing proposals, and the actual minimum period within which proposals are to be submitted shall be stated in the written notice given to each.
  9. Upon a 2/3 vote of all directors under Section 1 l.0l(b) above, the Board of Directors may determine that the initial or any subsequent proposal may be submitted to the membership for consideration. Notwithstanding any article, bylaw, policy, resolution or practice that has ever been utilized by this corporation to the contrary, a special meeting of the membership to consider an offer for the sale, lease, lease-sale, exchange, transfer or other disposition cannot be held with less than 60 days notice to the members expressing in detail each of any such proposal: PROVIDED, that consideration and action by the members may be given at the next annual member meeting if the Board so determines and if such annual meeting is held not less than 60 days after the giving of notice of such meeting.
  10. No offer for the sale, lease, lease-sale, exchange, transfer or other disposition of all or substantially all of the assets of the corporation may be presented for approval to the membership prior to 180 days after the affirmative 2/3 approval of the Board of Directors.
  11. Membership approval of any offer for the sale, lease, lease-sale, exchange, transfer or other disposition of all or substantially all of the assets of the corporation must be authorized by a resolution duly adopted at a meeting of the members duly called and held and wherein a quorum was established of 50% of the members in person and which resolution shall have received the affirmative vote of at least 50% of all its members for each and every district from which the Board members are nominated and elected.
  12. Notwithstanding any article, bylaw, policy, resolution or practice that has ever been utilized by this corporation to the contrary, no member meeting called for the purpose of considering any offer for the sale, lease, lease-sale, exchange, transfer or other disposition of all or substantially all of the assets of the corporation may be adjourned if there is a lack of a quorum. If such meeting lacks a quorum to consider any such proposal, the process of calling a member meeting for such purpose must start over.
  13. Any corporate approved proposal for the sale, lease, lease-sale, exchange, transfer or other disposition of all or substantially all of the assets of the corporation shall be approved by the Indiana Utility Regulatory Commission; provided, however, that the Board of Directors of the corporation shall have full power and authority, without authorization by the members thereof, to do the following:
    1. to borrow moneys from any source and in such amounts as the Board may from time to time determine,
    2. to issue the Cooperative's obligations evidencing such borrowing,
    3. to mortgage or otherwise pledge or encumber any or all of the Cooperative's property or assets as security therefor, and/or
    4. to authorize the execution and delivery of a mortgage, or mortgages, or a deed or deeds of trust of, or the pledging or encumbering of, any or all of the property, assets, rights, privileges, licenses, franchises and permits of the corporation, whether acquired or to be acquired and wherever situated, as well as the revenues therefrom, for the purpose of financing the construction or maintenance of the corporation's distribution system and for general plant as defined in the uniform system of accounts prescribed by the Indiana Utility Regulatory Commission, all upon such terms and conditions as the Board of Directors shall determine, to secure any indebtedness of the corporation to the United States of America or any agency or instrumentality thereof or to any financial institution, which action of the Board of Directors will be subject to the approval of the Indiana Utility Regulatory Commission, to the extent required by law. The Board of Directors shall also have full power and authority; without requirement of any member authorization or Commission approval, to sell, lease, lease-sell, exchange, transfer or otherwise dispose of merchandise, or of property no longer necessary or useful for the operation of the Cooperative, or of less than substantially all of the Cooperative's property and assets.

The provisions of this article shall not apply to a sale, lease, lease-sale, exchange, transfer or other disposition to one or more other rural electric cooperatives if the substantive or actual legal effect thereof is to merge or consolidate with such other one or more rural electric cooperatives. This Article may not be amended except upon 2/3 affirmative vote of the Board of Directors.

Section 11.02. Distribution of Surplus Assets on Dissolution. Upon the Cooperative's dissolution, any assets remaining after all liabilities or obligations of the Cooperative have been satisfied and discharged shall be allocated and retired to the then members on the basis of the then most current information.

Article XII. Authority to Issue Obligations

Subject to the approval of the Indiana Utility Regulatory Commission, the Corporation formed hereunder, shall have power and is hereby authorized, from time to time, to issue its obligations in anticipation of its revenues for any corporate purpose. Said obligations may be authorized by resolution or resolutions of the board and may bear such date or dates, mature at such time or times, not exceeding 40 years from their respective dates, bear interest payable semi-annually at such rate or rates, be in such denominations, be in such form, either coupon or registered, carry such registration privileges, be executed in such manner, be payable in such medium of payment, at such place or places, and be subject to such terms of redemption, not exceeding par and accrued interest, as such resolution or resolutions may provide.

Such obligations may be sold in such manner and upon such terms as the Board of Directors may determine, at not less than par and accrued interest. Any provision of law to the contrary notwithstanding, any obligations in the interest coupon appertaining thereto, if any, issued pursuant to this chapter, shall possess all of the qualities of negotiable instruments. However, approval of the Indiana Utility Regulatory Commission is not required when the Corporation has a mortgage with any federal agency.

Article XIII. Calendar Year

The Cooperative's calendar year shall begin on the first day of January each year and end on the last day of December.

Article XIV. Rules of Order

Parliamentary procedure at all meetings of the members, of the Board of Directors, of any committee provided for in these Bylaws and of any other committee of the members or Board of Directors which may from time to time be duly established shall be governed by the most recent edition of Robert's Rules of Order, except to the extent such procedure is otherwise determined by law or by the Cooperative's Articles of Incorporation or Bylaws.

Article XV. Seal

The Corporate seal of the Cooperative shall be in the form of a circle and shall have inscribed thereon the name of the Cooperative and the words "Corporate Seal, Indiana."

Article XVI. Amendments

These Bylaws may be altered, amended or repealed by resolution of the Board of Directors at any regular or special Board meeting, but only if the notice of such meeting shall have contained a copy of the proposed alteration, amendment or repeal, or an accurate summary explanation thereof.