Illinois Electric Cooperative, like all Cooperatives, is owned by its members who elect the members of its Board of Directors.

Members of the Cooperative’s Board of Directors serve staggered three-year terms. Information about qualifications for members of the Board and the nomination/election process is located in Article Four, Sections 3, 4, 5 and 6.

There are eleven director districts, as described in Article Four, Section 2. The elections for directors from those districts shall be as follows: In 2016, districts 2, 4, 6 and 8, in 2017, districts 1, 3, and 7 and in 2018, districts 5, 9, 10 and 11.

A map of the director districts is located at the end of this the Bylaws.

While we believe all of this document is important, your attention is particularly called to the last paragraph of Article Nine, which says in part “The members of the Cooperative, by dealing with the Cooperative, acknowledge that the terms and provisions of the Articles of Incorporation and Bylaws shall constitute and be a contract between the Cooperative and each member, and both the Cooperative and the members are bound by such contract,…”

As amended at the 2017 Annual Meeting.

Bylaws of Illinois Electric Cooperative

ARTICLE ONE

Membership

Section 1. Requirements for Membership. Any person, firm association, corporation or body politic or subdivision thereof will become a member of Illinois Electric Cooperative (hereinafter called the “Cooperative”) upon receipt of electric service or Internet service, whether the purchase of electric energy and/or energy services, or the purchase of Internet services and/or the delivery of Internet services, provided that he or she first:

(a) Made a written application for membership, therein;

(b) Agreed to purchase goods and services from the Cooperative; and,

(c) Agreed to comply with and be bound by the Articles of Incorporation and Bylaws of the Cooperative, and any rules and regulations and rate schedules as they exist or as they may thereafter be adopted or amended by the Board of Directors.

No member shall hold more than one membership in the Cooperative, and no membership in the Cooperative shall be transferable, except as provided in these Bylaws.

Section 2. Membership Records. The Cooperative will not issue certificates to members; it will keep permanent records of members and their capital credits as described herein.

Section 3. Joint Membership. A husband and wife may apply for a joint membership. The presence of either or both at a meeting shall be regarded as the presence of one member and shall constitute joint waiver of notice of the meeting. The joint membership shall have one vote, and that vote may not be divided. Either the husband or wife, but not both concurrently, may be elected or appointed as an officer or Board member provided that both meet the qualifications for such office.

Upon death of either spouse, the membership shall be held solely by the survivor.

Section 4. Purchase of Goods or Services. Each Class A member shall purchase electric energy and/or the delivery of the electric energy from the Cooperative as soon as electric energy or delivery services are made available to the member.  It is expressly understood that amounts paid in excess of the costs are furnished by Class A members as capital and each Class A member shall be credited with the capital so furnished as provided in these Bylaws.

Each Class B member shall purchase Internet and/or the delivery of Internet from the Cooperative as soon as Internet or delivery services are made available to the Class B member.

Section 5. Classification of Members. There are two classifications of members in the Cooperative. Class A members are those who purchase and/or have delivered electric energy from the Cooperative. Class B members are those who purchase and/or have delivered Internet services from the Cooperative. Both members are either active or inactive members. Active members are those currently buying electric and/or electric delivery services, or are currently buying Internet and/or Internet delivery services. Neither an inactive Class B member nor an inactive Class A member shall be eligible to vote in any elections or hold any elective office. Only Class A members who are active have the right to vote upon any proposition submitted to the membership, and they are eligible to hold any elective office providing he or she meets all of the other qualifications in these Bylaws.

Classification of a membership from inactive to active or vice versa, shall change at once without notice to said member upon that member's commencing to use or ceasing to use electric service, electric delivery services, Internet service or Internet delivery services from the Cooperative or disconnection by the Cooperative of the member's electric service, and/or electric delivery service, Internet service and/or Internet delivery service.

Change of classification shall not affect in any way any obligation for debts the member may have incurred with the Cooperative and shall not affect the capital credits accrued by the member.

Section 6. Termination of Membership. Any member may withdraw from membership upon compliance with such uniform terms and conditions as the board may prescribe. The board may by the affirmative vote of not less than two-thirds of all the members of the board expel any member who fails to comply with any of the provisions of the Article of Incorporation, bylaws, or rules and regulations adopted by the board, but only if such member shall have been given written notice by the Cooperative that such failure makes him liable to expulsion and such failures shall have continued for at least 10 days after such notice was given. Any expelled member may be reinstated by vote of the board of directors or by vote of the members at any annual or special meeting. The membership of a member who for a period of six months after service is available to him has not purchased electric energy from the Cooperative, or a member who has ceased to purchase energy from the Cooperative may be cancelled by resolution of the board.

Upon the withdrawal, death, cessation of existence or expulsion of a member, the membership of such member shall thereupon terminate and the membership certificate of such member shall be surrendered forthwith to the Cooperative. Termination of member ship in any manner shall not release a member or his estate from any debts due the Cooperative.

In case of withdrawal or termination of membership in any manner, the Cooperative shall deduct from the amount of member’s capital credit account the amount of any debts or obligations owed by the member to the Cooperative.

ARTICLE TWO

Rights and Liabilities of Members

Section 1. Property Interest of Members. Upon dissolution after (a) all debts and liabilities of the Cooperative shall have been paid and (b) all capital furnished through patronage shall have been retired, as provided in these bylaws, the remaining property and assets of the Cooperative shall be distributed among the Class A members and former Class A members in the proportion which the aggregate patronage of each bears to the total patronage of all Class A members, during the 10 years next preceding the date of filing of the certificate of dissolution.

Section 2. Non-liability for Debts for the Cooperative. The private property of the member shall be exempt from execution or other liability for the debts of the Cooperative and no member shall be liable or responsible for any debts or liabilities of the Cooperative.

ARTICLE THREE

Meetings of Members

Section 1. Annual Meeting. An annual meeting of the members shall be held between the first day of May and the fifteenth day of October, both dates inclusive, within the area served by the Cooperative at such hour and place as shall be designated by resolution of the Board of Directors and specified in the notice of the meeting for the purpose of electing directors, passing upon reports of the previous fiscal year, and transacting other such business as set forth in the notice of members meeting. No item of business may be considered at an annual meeting unless that item of business has been included in the notice of meeting as an item to be considered by members at that meeting. An item of business shall be placed on the annual meeting agenda by the Board of Directors or by petition signed by a least fifteen (15) members which petition must be delivered to the Cooperative office at least forty-five (45) days prior to the annual meeting at which such item(s) is to be considered by the members. It shall be the responsibility of the Board of Directors to make adequate plans and preparations for the annual meeting. If the election of directors shall not be held on the day designated therein for any annual meeting or at any adjournment thereof, the Board of Directors shall cause the election to be held at a special meeting of the members as soon thereafter as conveniently may be. Failure to hold the annual meeting at the designated time shall not work a forfeiture or dissolution of the Cooperative.

Section 2. Special Meetings. Special meetings of the members may be called by resolution of the board, or upon a written request signed by any three board members, by the president, or by ten per centum or more of all the members, and it shall thereupon be the duty of the secretary to cause notice of such meeting to be given as hereinafter provided. Special meetings of the members may be held at any place within one of the counties served by the Cooperative as designated by the board and shall be specified in the notice of the special meeting.

Section 3. Notice of Members’ Meeting. Written or printed notice stating the place, day and hour of the meeting and, in case of a special meeting, the purpose or purposes for which the meeting is called, shall be delivered not less than five (5) days nor more than sixty (60) days before the date of the meeting, either personally or by mail by or at the direction of the secretary, or by the persons calling the meeting, to each member; provided, however, that with respect to all meetings at which directors are to be elected such notice shall be so delivered not less than five (5) days nor more than fourteen (14) days before the date of the meeting. Notice of a meeting where the removal of one or more directors, a merger, consolidation, dissolution or sale, lease or exchange of assets are being considered by the membership, notice must be given not less than twenty (20) nor more than sixty (60) days before the date of the meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail, addressed to the member at his address as it appears on the records of the Cooperative, with postage thereon prepaid. In case of a joint membership, notice given to either husband or wife shall be deemed notice to both members. The failure of any member to receive notice of an annual or special meeting of the members shall not invalidate any action which may be taken by the members at any such meeting.

Section 4. Quorum. As long as the total number of Class A members does not exceed one thousand (1,000), at least fifteen percent (15%) of the total number present in person or represented by proxy shall constitute a quorum for the transacting of business at all meetings of the members, provided at least five percent (5%) of the total number of members are present in person. In case the total number of Class A members shall exceed one thousand (1,000) then at least one hundred fifty (150) of the Class A members present in person or represented by proxy shall constitute a quorum for the transaction of business at all meetings of the members. In case of a joint membership the presence at a meeting of either husband or wife or both shall be regarded as the presence of one member. If less than a quorum is present at any meeting, a majority of those Class A members present in person or represented by proxy may adjourn the meeting from time to time without further notice.

Section 5. Voting. Except in elections for directors, each active Class A member shall be entitled to one (1) vote and no more upon each matter submitted to a vote at a meeting of the members. At all meetings of the members at which a quorum is present all questions shall be decided by a vote of a majority of the members voting thereon in person or by proxy, except as otherwise provided by law, the Certificate of Incorporation or the Cooperative or these bylaws. If a husband and wife hold a joint Class A membership, they shall jointly be entitled to one (1) vote and no more upon each matter submitted to a vote at a meeting of the members. Inactive Class A members and all Class B members whether active or inactive, shall have no voting right.

Section 6. Removal of Directors by Members. One or more directors may be removed whenever in the judgment of the Class A members there is reason for the removal and the best interests of the Cooperative would thereby be served. The request to remove one or more directors must be submitted to the secretary of the Board of Directors a minimum of forty-five (45) days in advance of the meeting where the removal action is to be considered, and notice of the meeting must be given to all members not less than twenty (20) nor more than sixty (60) days before the date of the meeting to remove said director. The request shall be accompanied by a petition naming the director or directors sought to be removed and the reasons therefore, and signed by ten percent (10%) or more of all the Class A members.

Any vacancy occurring on the Board of Directors as a result of the removal by the Class A members shall be filled by an election of those Class A members. The members may conduct such an election at the same meeting of the members at which any director is so removed. Any director elected to fill a vacancy occurring on the Board of Directors as a result of removal by the Class A members shall serve the remainder of the term of the director so removed. At any election to fill any vacancy on the Board of Directors occurring as a result of such removal by the Class A members, cumulative voting shall not apply.

Section 7. Proxies. At all meetings of members, a Class A member may vote by proxy executed in writing by the Class A member. Such proxies shall be filed with the secretary before or at the time of the meeting. No proxy shall be voted at any meeting of the members unless (1) it shall designate the particular meeting at which it is to be voted and (2) it designates the particular issue or subject matter for which it is to be voted (i.e. director election, bylaw change). No proxy shall be voted at any meeting other than the one so designated or any adjournment of such meeting. No Class A member shall vote proxy for more than three (3) members for all issues or subject matters for which a proxy may be designated. No proxy shall be valid after sixty (60) days from the date of its execution. The presence of a Class A member at a meeting of the members shall revoke a proxy theretofore executed by him and such Class A member shall be entitled to vote at such meeting in the same manner and with the same effect as if he had not executed a proxy. In case of a joint Class A membership, a proxy may be executed by either husband or wife. The presence of either husband or wife at a meeting of the members shall revoke a proxy theretofore executed by either of them and such joint member or members shall be entitled to vote at such a meeting in the same manner and with the same effect as if a proxy had not been executed.

Section 8. Order of Business. The order of business at the annual meeting of the members, and so far as possible at all other meetings of the members, shall be essentially as follows,

(a) Report on the number of Class A members present in person and by proxy to determine the existence of a quorum.

(b) Reading of the notice of the meeting and proof of the mailing thereof.

(c) Reading of the unapproved minutes of the previous meeting of members and taking necessary action thereon.

(d) Class A members’ approval of the actions of the Board of Directors.

(e) Election of Directors.

(f) Business as described in the Notice of the Meeting.

(g) Adjournment.

ARTICLE FOUR

Board Members

Section 1. General Powers.

The board of directors shall consist of eleven (11) members. Except as otherwise provided by law, the Certificate of Incorporation of the Cooperative or by these bylaws, the board of directors shall manage the business, affairs and property of the Cooperative, authorize contracts, fix charges, for its services for furnishing electric energy to its members, and for other services rendered for and to its members, and shall otherwise manage the affairs of the Cooperative in such manner as may be necessary, convenient or proper in order to carry out its objects and purposes; provided, however, that the Cooperative shall not be operated for pecuniary profit either to itself or to its members. The board of directors shall also, from time to time, have the authority to appoint an “expert director” who will have no voting authority, but who will bring to the Board a high level of expertise in an area impacting Cooperative business, such as electric utilities, finance, cybersecurity, etc., and whose length of appointment shall not exceed one year, but may be extended by further action of the Board.

 

Section 2. Director Districts. The territory served by the Cooperative shall be divided into Director Districts. Each District shall be represented by one director, and the Districts as described, as follows:

1

Hadley, Kinderhook, Cincinnati, Barry, Levee, Pleasant Vale, Derry, and part of Atlas in R. 6W

Parts of Fall Creek, Payson, and Beverly

Pike

Adams

2

Fairmont, Perry, Chambersburg, Flint, New Salem, Griggsville, East Part of Pittsfield, Newburg and Detroit

Parts of Buckhorn, Elkhorn and Versailles

Pike

Brown

Adams

3

West Hagener and Parts of East Haegner, Arenzville, and South Part of Beardstown (in T. 18N)

Exeter-Bluffs, Naples-Bluffs and Merritt

T.16N, R.13W; T.16N, R.12W; T.15N, R.12W; T. 15N, R. 11W and part of T.16N, R. 11W, T.15N, R9W; and T.15N, R.10W

Cass

Scott

Morgan

4

Part of Atlas in R. 5W, Martinsburg, Ross, Pleasant Hill, Montezuma, Hardin,and

Rockport, Summer Hill, Martinsburg, Pleasant Hill, Nebo

Pike

Calhoun

5

Most of Pearl, Mozier, Kampsville, parts of Hardin

Pike

Calhoun

6

Alsey, Winchester, North part of Manchester (in T. 14N), Bloomfield and Glasgow

T.14N, R.11W

Scott

Morgan

7

T. 14N, R. 10W; T. 14N, R. 9W; T. 13N, R. 10W and Parts of T. 13N, R. 9W and T. 13N, R. 8W

Morgan

8

T.13N, R.11W

South part of Manchester (in T. 13N)

Part of Scottville

Northeast and Northwest parts of White Hall (in T. 12N), Patterson, Roodhouse and Athensville

Morgan

Scott

Macoupin

Greene

9

Parts Hardin & Gilead in T. 11S, Richwood and Point

Calhoun

10

Richwood, English

Walkerville, Bluffdale, Carrollton, Part of Woodville in T. 9N, Central & West Kane (in R. 12W & R. 13W)

Jersey

Greene

11

Wrights, Rubicon, Linder, Rockbridge and East Kane (in R. 11W)

Parts of Barr and Western Mound

Part of the North part of Jersey (in T. 9N) and Parts of Ruyle and Part of the South Part of Jersey (in T. 8N)

South Part of White Hall (in T. 11N)

Greene

Macoupin

Jersey

Notwithstanding the foregoing Director District descriptions, every three years the Board of Directors, not less than ninety (90) days prior to the earliest date on which the annual member meeting may be scheduled by these Bylaws to be held, shall review the Districts and, if the Board determines that they should be altered so as to correct any substantially inequitable factors regarding the residence of members, or the geographic location of Districts, and/or the number of directors to be elected from such Districts accordingly, in which event all Districts as so changed shall be noticed with specificity in writing to the members not later than five (5) days prior to the date on which the Committee on Nominations for the annual meeting shall first convene. After such notice, these Bylaws shall have been effectively amended accordingly until at least after the succeeding Annual Member meeting: PROVIDED that no such change shall be made 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 3. Qualification and Tenure.At the annual meeting of the members in 1980, four members to be elected shall serve for three years and four members shall serve for two years, the eight so elected shall determine their respective terms by lot. Each year thereafter only the number of Directors shall be elected each for a term of three years to fill vacancies of those Directors whose terms are expiring. Directors so elected shall serve until their respective term expires or until their successors have been elected and shall have qualified. No member shall be eligible to become or remain a Director or to hold a position of trust in the Cooperative unless he/ she has met all of the following qualifications: (1) he/she is an actual consumer of goods and services provided by the Cooperative, and; (2) he/ she actually resides in the district for which he/she has been nominated for or otherwise seek election in. Residing in the district requires that he/she have a residence or house within the district in which he/she stays full-time on a regular basis and for which he/she is registered to vote in the town, village, or city in which they reside. No member shall be eligible to become or remain a Director if he/she has in anyway been employed by or holds more than a 5% financial interest in, a competing enterprise. Failure of a Director to remain qualified during his/her tenure will require that Director to resign. 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 set forth. Nothing in this section contained 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.

Section 4. Nominations. It shall be the duty of the Board of Directors to appoint, not less than ninety (90) days nor more than two-hundred ten (210) days before the date of the meeting of the members at which directors are to be elected, a committee on nominations consisting of not less than five (5) nor more than eleven (11) Class A members who shall be selected so as to give equitable representation on the committee to the geographical areas served or to be served by the Cooperative. No officer or member of the board of directors shall be appointed a member of such committee. The committee shall prepare and post at the principal office of the Cooperative at least forty-five (45) days before the meeting a list of nominations for directors and such nominees shall be selected from the respective director districts of the cooperative service area scheduled for election under Section 2 of this Article. In addition, any fifteen (15) or more Class A members may make other nominations for directors in the respective director districts scheduled for election under Section 2 of this Article, in writing, over their signatures not less than forty-five (45) days prior to the meeting and the secretary shall post the same at the same place where the list of nominations made by the committee is posted. The secretary shall mail with the notice of the meeting a statement of the number of directors to be elected from each district and showing separately the nominations made by the committee on nominations and any nominations made by petition for each director district. The Class A members may, at any meeting at which a director or directors shall be removed, as provided in Article Three , Section 6, elect a successor or successors thereto without compliance with the foregoing provisions with respect to nominations. Notwithstanding anything in this section contained, failure to comply with any of the provisions of this section shall not affect, in any manner whatsoever, the validity of any election of directors.

Section 5. Vacancies. Subject to the provisions of these bylaws, a vacancy occurring in the board shall be filled by the affirmative vote of the majority of the remaining board members for the unexpired position of the term.

Section 6. 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 Class A member may vote for more than one nominee from any Director District. Ballots marked in violation of the foregoing restriction with respect to one or more Director 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 7. Compensation. Board members shall not receive any salary for their services, as such, except that the board of directors may, by a resolution, authorize a fixed sum either by (1) month or (2) per diem for each day or portion thereof spent on Cooperative business, such as attendance at meetings, conferences, and training programs, or performing committee assignments when authorized by the board, If authorized by the board, board members may also be reimbursed for expenses actually and necessarily incurred in carrying out such Cooperative business or granted a reasonable allowance by the board in lieu of detailed accounting for some of these expenses. No board member shall receive compensation for serving the Cooperative in any other capacity unless the payment and amount of compensation shall be specifically authorized by a vote of the Class A members or the service by the board member has been certified by the board as an emergency measure.

Section 8. Rules and Regulations. The board of directors shall have the power to make and adopt such rules and regulations, not inconsistent with law, the Certificate of Incorporation of the Cooperative or these bylaws, as it may deem advisable for the management, administration and regulation of the business and affairs of the Cooperative.

Section 9. Accounting System and Reports. The board of directors shall cause to be established and maintained a complete accounting system which, among other things, subject to applicable laws and rules and regulations of any regulatory body, shall conform to such accounting system as may from time to time be designated by the Administrator of the Rural Utilities Service of the United States of America. The board of directors shall also at the close of each fiscal year cause to be made a full and complete audit of the accounts, books, and financial condition of the Cooperative as of the end of such fiscal year. A report of such audit shall be submitted to the members at the next following annual meeting.

Section 10. Change in Rates. Written notice shall be given to the Administrator of the Rural Utilities Service of the United States of America not less than ninety (90) days prior to the date upon which any proposed change in the rates charged by the Cooperative for electric energy becomes effective.

Section 11. Area Coverage. The board shall make diligent effort to see that electric service is extended to all unserved persons within the Cooperative service area who (a) desire such service and (b) meet all reasonable requirements established by the Cooperative as a condition of service.

Section 12. Indemnification-Directors, Officers and Employees:

(a) The electric cooperative may indemnify any person who was or is a party, or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the electric cooperative) by reason of the fact that he is or was a director, officer, employee or agent of the electric cooperative, or who is or was serving at the request of the electric cooperative as a director, officer, employee or agent of another cooperative, corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding, if he acted in good faith and in a manner he reasonably believed to be in, or not opposed to, the best interests of the electric cooperative, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the electric cooperative, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful.

(b) The electric cooperative may indemnify any person who was or is a party, or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the electric cooperative to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the electric cooperative, or is or was serving at the request of the electric cooperative as a director, officer, employee or agent of another cooperative, corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit, if he acted in good faith and in a manner he reasonably believed to be in, or not opposed to the best interests of the electric cooperative, and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable for negligence or misconduct in the performance of his duty to the electric cooperative, unless, and only to the extent that the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability, but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnify for such expenses as the Court shall deem proper.

(c) To the extent that a director, officer, employee or agent of the electric cooperative has been successful, on the merits or otherwise, in the defense of any action, suit or proceeding referred to in paragraphs (a) and (b), or in defense of any claim, issue or matter therein, he shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by him in connection therewith.

(d) Any indemnification under paragraphs (a) and (b) (unless ordered by a court) shall be made by the electric cooperative only as authorized in the specific case, upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances because he has met the applicable standard of conduct set forth in paragraphs (a) or (b). Such determination shall be made (1) by the board of directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit or proceeding, or (2) if such a quorum is not obtainable, or, even if obtainable, a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, or (3) by the members.

(e) Expenses incurred in defending a civil or criminal action, suit or proceeding may be paid by the electric cooperative in advance of the final disposition of such action, suit or proceeding, as authorized by the board of directors in the specific case, upon receipt of an undertaking by or on behalf of the director, officer, employee or agent to repay such amount, unless it shall ultimately be determined that he is entitled to be indemnified by the electric cooperative as authorized in this Section.

(f) The indemnification provided by this Section shall not be deemed exclusive of any other rights to which those seeking indemnification may be entitled under any bylaw, agreement, vote of Class A members or disinterested directors, or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer, employee or agent, and shall inure to the benefit of the heirs, executors and administrators of such a person.

(g) The electric cooperative may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the electric cooperative, or who is or was serving at the request of the electric cooperative as a director, officer, employee or agent of another cooperative, corporation, partnership, joint venture, trust or other enterprise, against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the electric cooperative would have the power to indemnify him against such liability under the provision of this Section.

ARTICLE FIVE

Meetings of the Board

Section 1. Regular Meetings. A regular meeting of the board shall be held without notice, immediately after, and at the same place as, the annual meeting of the members. A regular meeting of the board shall also be held monthly at such time and place within one of the counties served by the Cooperative as designated by the board. Such regular monthly meeting may be held without notice other than such resolution fixing the time and place thereof.

Section 2. Special Meetings. Special meetings of the board may be called by the president or by any three board members, and it shall thereupon be the duty of the secretary to cause notice of such meeting to be given as hereinafter provided. The president or board members calling the meeting shall fix the time and place for the holding of the meeting.

Section 3. Notice of Board Meetings. Written notice of the time, place and purpose of any special meeting of the board shall be delivered to each member either personally or by mail, by or at the direction of the secretary, or upon a default in duty by the secretary, by the president or the board members calling the meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail addressed to the board member at his address as it appears on the records of the Cooperative, with postage thereon prepaid, at least five (5) days before the date set for the meeting.

Section 4. Quorum. A majority of the board shall constitute a quorum, provided, that if less than such majority of the board is present at said meeting, a majority of the board present may adjourn the meeting from time to time; and provided 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.

ARTICLE SIX

Officers

Section 1. Number. The officers of the Cooperative shall be a president, vice president, secretary, treasurer and such other officers as may be determined by the board from time to time. The offices of secretary and treasurer may be held by the same person.

Section 2. Election and Term of Office. The Officers shall be elected by ballot, annually by and from the Board of Directors at the first meeting of the Board of Directors held after each annual meeting of the Members, except for the office held by the Manager, who need not be a member of the Board of Directors, but who shall be elected annually by the Board of Directors. If the election of Officers shall not be held at such meeting, such election shall be held as soon thereafter as conveniently may be. Each officer shall hold office until the first meeting of the Board of Directors following 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 these by-laws with respect to the removal of Officers.

Section 3. Removal. Any officer or agent elected or appointed by the board of directors may be removed by the board of directors whenever in its judgment the best interest of the Cooperative will be served thereby.

Section 4. Vacancies. Subject to the provision of these bylaws, a vacancy in any office may be filled by the board of directors for the unexpired portion of the term.

Section 5. President. The president shall:

(a) be the principal executive office of the Cooperative and, unless otherwise determined by the members of the board, shall preside at all meetings of the members and the board;

(b) sign, with the secretary, certificates of membership for all members who have qualified for membership under these bylaws, and may sign any deeds, mortgages, deeds of trust, notes, bonds, contracts or other instruments authorized by the board to be executed, except in cases in which the signing and execution thereof shall be expressly delegated by the board or by these bylaws to some other officer or agent of the Cooperative, or shall be required by law to be otherwise signed or executed; and

(c) in general perform all duties incident to the office of the president and such other duties as may be prescribed by the board from time to time.

Section 6. 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 7. Secretary. The secretary shall be responsible for:

(a) keeping the minutes of the meetings of the members and of the board in books provided for that purpose;

(b) seeing that all notices are duly given in accordance with these bylaws or as required by law;

(c) the safekeeping of the corporate books and records and the seal of the Cooperative and affixing the seal of the Cooperative to all certificates of membership prior to the issue thereof, and 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;

(d) keeping a register of the names and post office addresses of members;

(e) keeping on file at all times a complete copy of the Articles of Incorporation and bylaws of the Cooperative containing all amendments thereto (which copy shall always be open to the inspection of any member) and at the expense of the Cooperative, furnishing a copy of the bylaws and of all amendments thereto to any member upon request; and

(f) in general performing all duties incident to the office of secretary and such other duties as from time to time may be assigned to him by the board.

Section 8. Treasurer. The treasurer shall be responsible for:

(a) custody of all funds and securities of the Cooperative;

(b) the receipt of and the issuance of receipts for all monies due and payable to the Cooperative and for the deposit of all such monies in the name of the Cooperative in such bank or banks as shall be selected in accordance with the provisions of these bylaws; and

(c) the general performance of all the duties incident to the office of treasurer and such other duties as from time to time may be assigned to him by the board.

Section 9. Manager. The board of directors may appoint a manager who may be, but who shall not be required to be, a member of the Cooperative. The manager shall perform such duties as the board of directors may from time to time require of him and shall have such authority as the board of directors may from time to time vest in him.

Section 10. Bond of Officers. The board of directors shall require the treasurer or any other officer 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.

Section 11. Compensation. The Compensation, if any, of any officer, agent or employee who is also a director shall be determined by the members as provided elsewhere in these bylaws, and the powers, duties and compensation of any officer, agents, and employees shall be fixed by the board of directors.

ARTICLE SEVEN

Contracts, checks and deposits

Section 1. Contracts. Except as otherwise provided in these bylaws, the board of directors may authorize any officer or officers, agent or agents 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 2. Checks, Drafts, etc. All checks, drafts and 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 and/or countersigned by such officer or officers, agent or agents, employee or employees of the Cooperative and in such manner as shall from time to time be determined by resolution of the board of directors.

Section 3. Deposits. All funds, except petty cash, of the Cooperative shall be deposited from time to time to the credit of the Cooperative in such bank or banks as the board of directors may select.

ARTICLE EIGHT

Waiver of Notice

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

ARTICLE NINE

Non-profit Corporation

Section 1. Interest or Dividends on Capital Prohibited. The Cooperative shall at all times be operated on a cooperative non-profit basis for the mutual benefit of its patrons. No interest or dividends shall be paid or payable by the Cooperative on any capital furnished by its patrons.

Section 2. Patronage Capital. The Cooperative’s operations shall be conducted so that all members will through their patronage furnish capital for the Cooperative. In order to induce patronage and to assure that the Cooperative will operate on a non-profit basis, the Cooperative is obligated to account on a patronage basis to all its members for all amounts received and receivable from the furnishing of services in excess of operating costs and expenses properly chargeable against the furnishing of services. All such amounts in excess of operating costs and expenses at the moment of receipt by the Cooperative are received with the understanding that they are furnished by the members as capital. The Cooperative is obligated to pay by credits to a capital account for each member all such amounts in excess of operating costs and expenses. The books and records of the Cooperative shall be set up and kept in such a manner that at the end of each fiscal year the amount of capital, if any, so furnished by each member is clearly reflected and credited in an appropriate record to the capital account of each member, and the Cooperative shall within a reasonable time after the close of the fiscal year notify each member of the amount of capital so credited to his account. All such amounts credited to the capital account of any member shall have the same status as though they had been paid to the member in cash in pursuance of a legal obligation to do so, and the member had then furnished the Cooperative corresponding amounts for capital.

In the event of dissolution or liquidation of the Cooperative, after all outstanding indebtedness of the Cooperative shall have been paid, outstanding capital credits shall be retired without priority on a prorata basis before any payments are made on account of priority rights or members. If, at any time prior to dissolution or liquidation, the Board of Directors shall determine that the financial condition of the Cooperative will not be impaired thereby, the capital then credited to members’ accounts may be retired in full or in part. Any such retirements of capital 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 the first retired for amounts furnished and credited prior to January 1, 1999. For capital furnished and credited after January 1, 1999, the Cooperative’s Board of Directors may retire such capital in any order whatsoever.

Notwithstanding any other provision of these Bylaws, the Board of Directors, as reasonable and fair, may retire and pay capital credits at any time to the following classes of similarly situated members and former members: (1) deceased members, (2) spouses of deceased members, and (3) members who move away from the system and no longer have active accounts.  Capital credits may be retired for these classes for as long as the Cooperative retires and pays capital credits to similarly situated members under the same manner, method and timing.  Capital credits retired in this fashion may be done so after (1) the death of the member, or the member moving away from the system, (2) after receiving a written or electronic request from the deceased individual’s legal representative, the spouse of the individual deceased member, or the émigrés member, and (3) according to the terms and conditions agreed upon by the Cooperative and deceased individuals legal representative, spouse or émigrés, as the case may be.  In all such cases, the financial condition of the Cooperative shall not be impaired thereby.

The Board of Directors, at its discretion, shall have the power at any time upon the death of any member, if the legal representatives of his estate shall request in writing that the capital credited to any such member be retired prior to the time such capital would otherwise be retired under the provisions of these Bylaws, to retire capital credited to any such member immediately upon such terms and conditions as the Board of Directors acting under policies of general application, and the legal representatives of such member’s estate shall agree upon; provided, however, that the financial condition of the Cooperative will not be impaired thereby.

The members of the Cooperative, by dealing with the Cooperative, acknowledge that the terms and provision of the Articles of Incorporation and Bylaws shall constitute and be a contract between the Cooperative and each member, and both the Cooperative and the members are bound by such contract, as fully as though each member had individually signed a separate instrument containing such terms and conditions, and a copy of the Bylaws shall be furnished to each new member and to any existing member upon the request of such member.

ARTICLE TEN

Disposition of Property

The Cooperative may not sell, mortgage, lease or otherwise dispose of or encumber all, or substantially all, of its property unless such sale, mortgage, lease or other disposition or encumbrance is authorized at a meeting of the members thereof by the affirmative vote of not less than two-thirds of the members present in person or by proxy and unless the notice of such proposed sale, mortgage, lease or other disposition or encumbrance shall have been contained in the notice of the meeting; provided, however, that notwithstanding anything hereinabove contained, the execution and delivery of a mortgage or mortgages or a deed or deeds of trust upon, or the pledging or encumbering of, any or all of the property, assets, rights, privileges, licenses, franchises and permits of the Cooperative, whether acquired or to be acquired, and wherever situated, as well as the revenues and income therefrom, to secure any indebtedness of the Cooperative to United States of America or any instrumentality or agency thereof, or to a national financing institution organized on the cooperative plan for the purpose of financing its members program, projects and undertakings, in which the cooperative holds membership may be authorized in the manner provided by Section 111.55 of the General Non-For-Profit Corporation Act of 1986 of the State of Illinois (805 ILCS 105/111.55) or any amendment thereof; provided further that notwithstanding anything hereinabove contained the board of directors of the Cooperative, without authorization by the members of the Cooperative, shall have full power and authority to sell, lease, exchange, transfer on assumption of indebtedness or otherwise dispose of property of the Cooperative, even though it be a substantial portion thereof, to another cooperative or foreign corporation doing business in the State of Illinois pursuant to the act under which this Cooperative is incorporated if such other cooperative or foreign corporation doing business in the State is organized on a nonprofit basis for the purpose of engaging in or furthering the cause of rural electrification, or if such other corporation is organized for the purpose of providing or acquiring electric energy or providing services or facilities on a cooperative basis, and provided further that the board of directors may, upon the authorization of a two-third vote of those members of the Cooperative present in person or represented by proxy at a meeting of the members thereof, sell, lease, or otherwise dispose of all or a substantial portion of its property to another cooperative or foreign corporation doing business in this State pursuant to the Act under which this Cooperative is incorporated.

ARTICLE ELEVEN

Fiscal Year

The fiscal year of the Cooperative shall be any twelve month period as the Board of Directors may determine to be in the best interest of the Cooperative.

ARTICLE TWELVE

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 words, “Corporate Seal, Illinois.”

ARTICLE THIRTEEN

Amendments

These bylaws may be altered, amended or repealed by the Class A members at any regular or special meeting, provided a copy of the proposed alteration, amendment or repeal is furnished to each member at the same time and in the same manner that the notice of such meeting is given.

ARTICLE FOURTEEN

Borrowing Authority

By adopting these Bylaws, the membership sets the borrowing authority of the Cooperative at one hundred million dollars ($100,000,000).


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