Hickman-Fulton Counties Electric
Cooperative Corporation Bylaws

ARTICLE I MEMBERSHIP

Section 1. Requirements for Membership. Any person, firm, association, corporation, or body politic or subdivision thereof will become a member of Hickman-Fulton Counties Electric Cooperative Corporation (hereinafter called the “Cooperative”) upon receipt of electric service from the Cooperative, provided that he or it has first:

(a)Made a written application for membership therein;

(b)Agreed to purchase from the Cooperative electric energy as hereinafter specified;

(c)Agreed to comply with and be bound by the articles of incorporation and bylaws of the Cooperative and any rules and regulations adopted by the board, and

(d)Paid the membership fee hereinafter specified.

(e)Been granted approval by the Board.

No member may 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. I. Membership Certificates. Membership in the Cooperative shall be evidenced by a membership certificate which shall be in such form and shall contain such provisions as shall be determined by the board. Such certificate shall be signed by the President and by the Secretary of the Cooperative and the corporate seal shall be affixed thereto. No membership certificate shall be issued for less than the membership fee fixed in these bylaws, nor until such membership fee has been fully paid. In case a certificate is lost, destroyed or mutilated a new certificate may be issued therefore upon such uniform terms and indemnity to the Cooperative as the board may prescribe.

II. Joint Membership.The term “member” as used in these Bylaws shall be deemed to include a husband and wife and shall be considered a “joint membership”. Either a husband or a wife may apply for membership. A request for service by either will be considered a joint membership applying to both the husband and the wife. Any provisions relating to the rights and liabilities of membership shall apply equally to both the husband and the wife. Without limiting the generality of the foregoing, the effect of a joint membership shall include the following:

1. The presence at a meeting of either or both shall be regarded as the presence of one member and shall constitute a joint waiver of notice of the meeting;

2.The vote of either separately or both shall constitute one joint vote;

3.A waiver of notice signed by either or both shall constitute one joint waiver;

4.Notice to either shall constitute notice to both;

5.Expulsion of either shall terminate the membership to both;

6.Withdrawal of either shall terminate the joint membership;

7.Either, but not both, may be elected or appointed as an officer or Board Member, provided that he or she meet the qualifications for such office.

8.Either or both shall be liable for payment of all indebtedness owed the Cooperative for electric service, fees and charges attributable to the joint account to include attorney fees and court costs resulting from any legal action necessary to collect a delinquent account.

III.Death of Either Spouse or Divorce

(a)Upon the death of either spouse who is a party to the joint membership, such membership shall be held solely by the survivor. However, the estate of the deceased spouse shall not be released from any debts due the Cooperative.

(b)Upon the dissolution of marriage or legal separation of the holders of a joint membership, the membership shall be held by the party continuing to use the electric service, provided, however, the spouse no longer using the service shall not be released from any debts due the Cooperative.

Section 3. Membership Fees. The membership fee shall be as prescribed by the Board of Directors, upon the payment of which a member shall be eligible for service connection. Members may request multiple service locations under one membership, however applicable costs and connection fees will apply at each service connection.

Section 4. Purchase of Electric Energy. Each member shall, as soon as electric energy shall be available, purchase from the Cooperative all electric energy used on the premises specified in his application for membership, and shall pay therefore at rates which shall from time-to-time be fixed by the board. It is expressly understood that amounts paid for electric energy in excess of the cost of service are furnished by members as capital and each member shall be credited with the capital so furnished as provided in these bylaws. Each member shall pay to the Cooperative such minimum amount regardless of the amount of electric energy consumed, as shall be fixed by the board from time-to-time. Each member shall also pay all amounts owed by him to the Cooperative as and when the same shall become due and payable.

Section 5. Termination of Membership.

(a)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 articles of incorporation, bylaws or rules or regulations adopted by the board, but only if such member shall have been given written notice by the Cooperative that such a failure makes him liable to expulsion and such failure shall have continued for at least ten days after such notice was given, but only after due hearing if such is requested by him. Any expelled member may be reinstated by vote of the board or by vote of the members at any annual or special meeting. The membership of a member who for a period of six (6) months after service is available to him, has not purchased electric energy from the Cooperative, or of a member who has ceased to purchase energy from the Cooperative, may be cancelled by resolution of the board.

(b)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 membership in any manner shall not release a member or his estate from any debts due the Cooperative.

(c)In case of withdrawal or termination of membership in any manner, the Cooperative shall repay to the member the amount of the membership fee paid by him, provided, however, that the Cooperative shall deduct from the amount of the membership fee the amount of any debts or obligations owed by the member to the Cooperative.

Section 6. Transfer and Termination of Membership.

(b) Any member whose service is disconnected for any reason, for a period of thirty (30) days will automatically become an associate member only, and his, her or its membership will become a nonvoting membership until said member is reconnected and receiving electrical current.

ARTICLE II

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 members and former members in the proportion which the aggregate patronage of each bears to the total patronage of all members during the ten years next preceding the date of the filing of the certificate of dissolution, or, if the Cooperative shall not have been in existence for such period, during the period of its existence.

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

ARTICLE III

MEETING OF MEMBERS

Section 1. Annual Meeting. The annual meeting of the members shall be held during the months of June or July of each year beginning with the year 1937, provided, that, for cause sufficient to it, the Board of Directors may fix a different date for such annual meeting not more than forty-five (45) days prior or subsequent to the day otherwise established for such meeting in this Section. The annual meeting will be held at such place within a county served by the Cooperative, as selected by the board and which shall be designated in the notice of the meeting, for the purpose of electing board members, passing upon reports for the previous fiscal year and transacting such other business as may come before the meeting. It shall be the responsibility of the board to make adequate plans and preparations for the annual meeting. 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 shall thereupon by 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. Same shall be on such date, not sooner than thirty-five (35) days after the call for such meeting is made or a petition therefore is filed, and beginning at such hour as shall be designated by him or those calling or petitioning for the same.

Section 3. Notice of Members’ Meetings. Written or printed notice stating the place, day and hour of the meeting and, in case of a special meeting or an annual meeting at which business requiring special notice is to be transacted, the purpose or purposes for which the meeting is called, shall be delivered not less than ten days nor more than twenty-five days before the date of the meeting, either personally or by mail, by or at the direction of the Secretary, or upon a default in duty by the Secretary, by the persons calling the meetings, to each member. 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 paid. 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 be the members at any such meeting.

Section 4. Quorum. A quorum shall constitute of at least one percent of the total membership or fifty members, whichever is larger. If less than a quorum is present at any meeting, a majority of those present in person may adjourn the meeting from time to time without further notice. The Minutes of such meeting shall contain a list of the members present in person.

Section 5. Voting. Each member shall be entitled to only one vote upon each matter submitted to a vote at a meeting of the members. All questions shall be decided by a vote of a majority of the members voting thereon in person, except as otherwise provided by law, the articles of incorporation or these bylaws.

Section 6. Proxies. At all meetings of members, a member may vote by proxy executed in writing by the member. Such proxy 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 it shall designate the particular meeting at which it is to be voted, and no proxy shall be voted at any meeting other than the one so designated or any adjournment of such meeting. No member shall vote as proxy for more than two (2) members at any meeting of the members except where such person is exercising a proxy in connection with the borrowing of funds from United States of America or a sale, mortgage, lease or other disposition or encumbrance of property to United State of America or any agency or instrumentality thereof or in connection with an amendment to the articles of incorporation of the Cooperative. No proxy shall be valid after sixty (60) days from the date of its execution, the presence of a member at a meeting of the members shall revoke a proxy theretofore executed by him and such 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.

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

1.Report on the number of members present in person in order to determine the existence of a quorum.

2.Reading of the notice of the meeting and proof of the due publication or mailing thereof, or the waiver or waivers of notice of the meeting, as the case may be.

3.Reading of unapproved minutes or previous meetings of the members and the taking of necessary action thereon.

4.Presentation and consideration of reports of officers, trustees and committees.

5.Election of board members.

6.Unfinished business.

7.New business.

8.Adjournment.

ARTICLE IV

BOARD MEMBERS

Section 1. General Powers. The business and affairs of the Cooperative shall be managed by a board of five (5) members which shall exercise all the powers of the Cooperative except such as are by law, the articles of incorporation or these bylaws conferred upon or reserved to the members.

Section 2. Election and Tenure of Office. The persons named as board members in the articles of incorporation shall compose the board until the first annual meeting or until their successors shall have been elected and shall have qualified. Members of the board shall be elected by ballot at each annual meeting of the members beginning with the year 1937, by and from the members, to serve until the next annual meeting of the members or until their successors shall have been elected and shall have qualified. If an election of board members shall not be held on the day designated herein for the annual meeting, or at any adjournment thereof, a special meeting of the members shall be held for the purpose of electing board members within a reasonable time thereafter. Board members may be elected by a plurality vote of the members. The directors shall be elected for a term of three (3) years beginning in 1984 to be phased as follows: they shall be elected from District No. 3 and District No. 5 for a 3 year term at the Annual Meeting in 1984, the director from District No. 2 shall be elected for a 2-year term at the Annual Meeting in 1984. The directors from Districts No. 1 and No. 4 shall be elected for a 3-year term at the Annual Meeting in 1985, and the director from District 2 shall be elected for a 3-year term at the Annual Meeting in 1986. After this has been phased in all directors from all districts shall be elected for 3-year terms thereafter.

Section 3. Voting Districts. The territory served or to be served by the Cooperative shall be divided into five (5) districts, each of which shall contain as nearly as possible the same number of members. Each district shall be represented by one board member. The original five districts shall be as follows:

District No. 1. Beginning at the point of intersection of the Mississippi River and the Hickman- Fulton County line, said point being the southwest corner of this district; thence in an easterly and southeasterly direction along said County line to the point of intersection of said line with Obion Creek; thence following the meanders of said creek in a northeasterly direction to the point of intersection of said creek with Hickman-Carlisle County line; thence in a northerly direction along the Cooperative’s east line to the point of intersection of said line with the Carlisle-Ballard County line; thence in a westerly direction along said line to the Mississippi River; thence along said river in a southerly direction to the point of beginning.

District No. 2. Beginning at the point of intersection of Ky. Highway No. 1053 and Obion Creek; thence in an easterly direction along said highway to the G.M. & O. Railroad at Greenwood Crossing; thence in a southeasterly direction along said railroad to the Hickman- Fulton County line; thence in an easterly and southeasterly direction along said County line to a point approximately at the intersection of the Illinois Central Railroad and Ky. Highway 94; thence in an easterly direction along Highway No. 94 to the Cooperative east line; thence in a northerly and northwesterly direction along said Cooperative line to the point of intersection of Hickman-Carlisle County line and Obion Creek; thence in southwesterly direction along the meanders of said creek to the point of beginning.

District No. 3. Beginning at the point of intersection of the G.M. & O. Railroad with the Hickman-Fulton County line just south of Moscow, said point being the southwest corner of District No. 2; thence in an easterly and southeasterly direction along the south line of District No. 2 to the point in the Cooperative east boundary line, said point being the southeast corner of district No. 2; thence south along the east Cooperative boundary line to a point in the Ky.-Tenn.

State line; thence west along the Cooperative’s south boundary line to a point in the Ky-Tenn. State line at Jordan; thence in a northerly direction along the G.M. & O. R.R. to the point of beginning.

District No. 4. Beginning at the point of intersection of the Mississippi River with the Hickman- Fulton County line, said point being the southwest corner of District No. 1; thence in an easterly and southeasterly direction along said county line to the point of intersection of said line with Obion Creek; thence in a northerly direction along said creek to the point of intersection of said creek with Highway No. 123; thence in an easterly direction along said highway to the point of intersection of said highway with the G.M. & O. Railroad at Greenwood Crossing; thence in a southerly direction along said railroad to a point in the Ky.-Tennessee State line at Jordan; thence in a westerly direction along the Cooperative’s south line to a point in Troy Road; thence in a northerly direction along Troy Road; to a point in the Mississippi River at Hickman; thence in a northerly direction along said river to the point of beginning.

District No. 5. Bounded on the east by the west line of District No. 4; on the north by the

Mississippi River; on the west by the Mississippi River; on the south by the Cooperative’s south line. Together with Madrid Bend, which is bounded by the Mississippi River on the north, east and west and by the Tennessee State line or the Cooperative’s south line on the south.

Section 4. Qualification. No person shall be eligible to become or remain board member of the Cooperative who:

A. Any person who serves on the HFRECC Board must be a United States citizen who first meets all of the following requirements:

1.Be a member of HFRECC whose permanent, principal residence is presently located and has been located during the past sixty (60) months in the district served by HFRECC where the vacancy exists;

2.Not be an employee of or financially interested in (i) a competing enterprise, other than indirect and minimal ownership through a mutual stock or bond fund or similar investment entity, or (ii) an entity which sells goods or services to HFRECC, if the entity derives more than 1% of its annual gross income from sales to HFRECC;

3.Have the capacity to enter into legally binding contracts;

4.Before becoming a Director, graduate from high school or earn an equivalent degree or certification;

5.Not be an employee of, retired employee of, nor have been employed by HFRECC during the past sixty (60) months, nor be the spouse of such a person;

6.Not be a close relative of an active employee, director or attorney of HFRECC;

7.Not having entered a plea of guilty to, or no contest to, or have been convicted of, a felony, or while a Director, and prior to becoming a Director, not have a final judgment entered against them involving civil fraud, ethical violations, discrimination and/or acts of harassment;

8.While a Director, and eight-four (84) months immediately before becoming a Director, not have been discharged of debt in a federal bankruptcy proceeding or have had as a debtor a final order entered against them in a similar proceeding under applicable state law such as insolvency, liquidation, receivership reorganization, or assignment for the benefit of creditors;

9.While a Director, and eighty-four (84) months immediately before becoming a Director, not have been a party to a foreclosure or other proceeding (judicial or non-judicial), which resulted in a judicial sale of any of the Director’s property which proceeding is or was instituted because of the director’s default on indebtedness;

10.The Director shall have a valid Motor Vehicle Operator’s License.

11.The Director must comply with the Credentialing requirements set forth in this Policy.

12.The Director shall materially participate as a Director as follows:

a.Except as otherwise provided by the Board of Directors for good cause shown, the Director must attend at least ninety percent (90%) of all properly noticed Regular and Special Board Meetings, Committee Meetings and Board Telephone/Video Conference Meetings during each twelve (12) month rolling period.

b.Except as otherwise provided by the Board of Directors for good cause shown, the Director shall not miss more than two (2) consecutive properly noticed Regular Board Meetings;

c.While a Director, the Director must not breach the Director’s fiduciary duties to HFRECC, violate confidences, or engage in illegal activity under the color of authority as a Director;

d.While a Director, the Director must provide a “Disclosure and Authorization” form to be used for obtaining periodic background check based on employment purposes.

e.The Director must comply with any other reasonable qualifications determined, made, adopted, amended, and/or disseminated in policies or rules of HFRECC, not inconsistent with law, the Articles of Incorporation regulations, or By-Laws.

f.While a director, and during the thirty-six (36) months immediately before becoming a director, not be an employee of an entity of which HFRECC is a member or owns an interest;

g.While a director, and during the thirty-six (36) months immediately before becoming a director, not have been a director, officer, employee or agent of a union or other entity representing, or seeking to represent, HFRECC employees regarding the terms and conditions of employment with HFRECC;

Notwithstanding any of the foregoing provisions, no incumbent director shall lose eligibility to remain a director or be re-elected as a director if he or she becomes a close relative of another incumbent director, a HFRECC employee, or attorney representing HFRECC because of a marriage to which he or she was not a party.

“Close relative” as used in this policy shall be defined as a person who by blood or marriage, including, half, step, and adoptive kin is either a spouse, child, grandchild, parent, grandparent, brother, sister, aunt, uncle, nephew, or niece of the principal.

Upon establishing the fact that a director is holding the office in violation of any of the foregoing provisions, unless the violation is promptly and to the complete satisfaction of the Board, the Board shall remove such director from office. Nothing contained in this section shall affect the validity of any action taken at any meeting of the Board.

COMMITMENT TO SERVICE – DIRECTOR

Each Director must be a proven community leader who is willing to make a meaningful contribution to carrying out the functions of a Director. Functions of a Director include:

A. Demonstrate absolute understanding of the need to give the necessary time required to be an active Director by thorough preparation for and regular attendance at;

1.Meetings of the Board, and any Board committees on which the Director serves, meetings of other boards or committees on which the Director officially represents HFRECC.

2.State and national association meetings and training seminars.

3.Director orientation and training programs, and other meetings deemed necessary to keep the Director informed and educated in order to be a responsible and learned Director. Directors are expected to gain and maintain the knowledge and skills necessary to function actively and effectively as a Director. The information, education and networking knowledge obtained from such meetings is imperative to the skills necessary and required for a Director to make intelligent and informed choice on the complex and rapidly changing matters that come before an energy cooperative board.

4.Study data and other information presented to the Board to keep fully informed and prepared for Board discussions and deliberations.

5.Contribute significantly to Board Meetings by raising pertinent and discerning questions and by contributing innovative ideas and suggestions.

6.Support decisions and actions approved by a majority of the Board.

7.Make every effort to obtain member and public understanding and support of HFRECC while being sensitive to and knowledgeable about their needs, concerns and attitudes.

8.Become skilled in raising questions about end results being achieved in certain key performance areas and in interpreting operating and financial reports.

9.Provide leadership to meet changing needs of the membership and improve the quality of life in

HFRECC’s service areas.

ADDITIONAL BOARD OF DIRECTOR QUALIFICATIONS

A director must at all times:

1. Share a belief in HFRECC’s principles and way of doing business, including:

a.Member ownership and control

b.One member, one vote for all members who attend and participate at Member meetings

c.Non-profit operation

d.Area coverage

2.Share a belief that energy resources of this country should be developed to provide adequate energy at an affordable cost for all people, and that HFRECC will make such affordable cost energy available to its members.

3.Exercise honesty, fairness, objectivity and diligence in the performance of corporate duties and responsibilities.

4.Display the utmost loyalty to HFRECC and members of HFRECC in all matters pertaining to its affairs.

5.Fulfill the director’s, officer’s, and key employee’s fiduciary duty to HFRECC and the members of HFRECC, which means that at all times each director, officer and key employee shall place the interest of HFRECC and members of HFRECC ahead of the interests of that director, officer and key employee. This will require each such person to set aside longtime friendships, political alliances, personal feelings and personal financial interests as required to best protect the interests of HFRECC and members of HFRECC, including balancing the financial interests of one member with the financial interests of all members.

6.Demonstrate by his or her action the following personal characteristics:

a.Provide strong and dependable leadership in his/her community.

b.Exhibit the highest integrity and earn and maintain the respect of the community in which he/she lives.

c.Use sound judgment and possess the ability to reason logically and clearly.

d.Demonstrate maturity and understanding of others, their concerns and viewpoints.

e.Exercise a high level of personal hygiene, be neat and well-dressed, and strive to make a favorable impression whenever in contact with any member of HFRECC or the public.

h. Must be mentally and physically capable of fulfilling his/her duties as a director, officer, or key employee.

STANDARDS OF CONDUCT FOR DIRECTORS

1.A director shall discharge his/her duties, including a director’s duties as a member of a committee:

a.In good faith;

b.On an informed basis; and

c.In a manner he or she honestly believes to be in the best interests of HFRECC and its members.

2.A director shall be considered to discharge his or her duties on an informed basis if he or she makes, with the care an ordinarily prudent person in a like position would exercise under similar circumstances, inquiry into the business and affairs of HFRECC and its members, or into a particular action to be taken or decision to be made.

3.In discharging his or her duties, a director shall be entitled to rely on information, opinions, reports, or statements, including financial statements and other financial data, if prepared or presented by:

a.One or more officers or employees of HFRECC whom the director, officer, and/or key employee honestly believes to be reliable and competent in the matters presented;

b.Legal counsel, public accountants, or other persons as to matters the director, officer, and/or key employee honestly believes are within the person’s professional or expert competence;

c.A director may rely upon a committee of the board of directors of which he or she is not a member, if the director honestly believes the committee merits confidence.

4.A director shall not be considered to be acting in good faith if he or she has knowledge concerning the matter in question that makes reliance otherwise permitted by Subsection 3 of this section unwarranted.

MANDATORY DIRECTOR TRAINING

In an effort to meet the needs of the Cooperative to provide a fully rained and efficient Board leadership, the Cooperative has instituted the following mandatory Director Training and Education requirements for all Directors who assume Director duties commencing on January 1, 2014, and thereafter. All current Directors are encouraged to meet the training and education requirements, however, compliance by current sitting Board Directors shall not be mandatory under this By-Law and Policy 2.0. All Board Directors who assume Director duties on or after January 1, 2014, shall meet the following requirements:

1. Credentialed Cooperative Director (CCD)

Within the first full three-year term, new Directors shall complete the courses necessary to earn NRECA’s CCD certificate.

2.Non-Compliance.

If a Director fails or refuses to complete the training requirements within the time requirements set forth in this Policy, the Director shall be suspended from receiving any Meeting Fees, Per Diem, or other expenses which would be otherwise authorized under Policy 15.0 (or other Policy) until such point that said Director completes the required training under this Policy.

Upon establishment of the fact that a board member is holding the office in violation of any of the foregoing provisions, the board shall remove such board member from office.

Nothing contained in this section shall affect in any manner whatsoever the validity of any action taken at any meeting of the board.

SECTION 5. I. Nominations.

All candidates, nominated by the Advisory Board or who file as Challengers shall be subject to the qualifications set forth in Board Policy 2.0 which is in effect at the time of nomination or application.

It shall be the duty of the Board to appoint, not less than forty-five days nor more than ninety days before the date of a meeting of the members at which Board members are to be elected, an Advisory Board which shall be convened to act as a nominating committee. No member of the Board may serve on such Advisory Board. The Advisory Board, keeping in mind the principal of equitable representation, shall prepare and post at the principal office of the Cooperative at least thirty days before the meeting a list of nominations for Board members which shall include at least one candidate for each Board position to be filled by the election. Any person nominated by the Advisory Board shall execute and submit an Application as set forth under Board Policy 2.1 and shall be provided a copy of the qualifications to serve as set forth in Board Policy 2.0.

Immediately following the posting of the official nominations of the Advisory Board as set forth above the Cooperative shall accept Applications of Challengers from any member of the Cooperative in good standing and residing on the system in a District that that is up for election in a given year who desires serve. Any person wishing to file an Application as a Challenger to serve as Board Member shall meet with the Board Attorney and Manager or other appointed employee/agent of the Cooperative to review the qualifications and responsibilities of the position and answer other specific questions that the candidate may have regarding his or her application. The Application shall be submitted by the candidate personally at the Cooperative Office. The Challenger shall sign and submit an Application as set forth in Board Policy 2.1 and shall be given a full copy of the qualifications as set forth in Board Policy 2.0. Any challenger who files a Petition to Challenge the candidates nominated by the Advisory Board shall further submit a supporting Petition to Nominate signed by at least twenty-five members in good standing of the Cooperative. Applications and supporting Petitions shall be received at the Cooperative office by close of business at least 15 days prior to the meeting of the membership at which the election shall be held. The Secretary shall post a copy of the Application and the signed Petition to Challenge at the same place and in the same manner where the list of nominations by the Advisory Board is posted. The signatures on the petition must be of

members in good standing and residing on the system, signed and dated by each member signing after the filing of the Application by the challenger candidate.

The Election Tellers shall verify the signatures on the petition. No other nominations may be made other than as set forth herein. 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.

The Secretary shall be responsible for mailing the notice of the meeting. Additionally, at least ten days before the date of the meeting, a statement of the number of Board members to be elected and the names and addresses of all candidates nominated by the Advisory Board or having filed as Challengers shall be published in the current legal newspaper of record in Carlisle, Hickman, and Fulton Counties as set forth under KRS Chapter 424.

II. Voting. The board shall designate at least 3 election tellers at or prior to the annual meeting. The Cooperative Board Attorney shall act as Parliamentarian. Election by acclamation by voice or hand may be utilized for uncontested elections. The nomination of 2 or more persons for a director’s position shall require a secret ballot.

A ballot shall be provided to each member of the Cooperative at the Annual Meeting. The ballot shall list persons nominated for the office of Director as herein set out.

Each member may vote for the Director or Directors of his choice by marking in the space provided thereon and shall return his ballot to the Election Tellers.

The Election Tellers shall count the same, certify the results of the election, and the result shall be made public at the Annual Meeting of the Cooperative.

Each member of the Cooperative shall be entitled to cast one (1) vote for each

vacancy to be filled, however, cumulative voting shall not be permitted.

The following ballots shall not be counted:

1.Unmarked ballots

2.Ballots marked for more candidates than vacancies to be filled

3.Ballots marked for more than one candidate for any one (1) vacancy

4.Ballots other than the official ballot

5.Ballots arriving late


The following ballots may be counted:

1.Ballots on which the mark is not in the place provided, but does show the intention of the voter

2.Ballots on which there is an erasure or change of intention shown, but the Election Tellers are of the opinion that the ballot has not been tampered with

The Election Tellers shall certify the number of votes received by each candidate. The report shall be delivered by the Election Tellers to the Chairman of the Board and the result announced at the Annual Meeting. The Election Tellers shall elect among themselves a head teller.

The person nominated for Director in his district, receiving the highest number of votes as certified by the Election Tellers, is the person elected. If more than one person receives the same number of votes, the Election Tellers shall, at a meeting at a time and place to be fixed by them, at which due notice shall be given to the nominees, cause the nominees or their representatives, or in the absence of a nominee or his representative, some person designated by the Election Tellers to draw for the office and the person drawing the slip marked “elected” shall be the person elected.

SECTION 6. Removal of Board Member by Members. Any member of the Cooperative may bring charges against a member of the Board of Directors and by filing with the Secretary of the Cooperative such charges in writing, together with a petition signed by at least ten percent of the members of the Cooperative or 300, whichever is the lesser, may request the removal of such person from the Board at a regular or special meeting of the members called for that purpose. Such board member shall be informed in writing of the charges at least ten days prior to the time of said meeting and shall have an opportunity at the meeting to be heard in person or by counsel and to present evidence in respect to the charges. The member or members bringing the charges shall have the same opportunity and the question of the removal of the Board member shall be decided by a majority of the votes cast at the meeting and any vacancy created by such removal may be filled by vote of the members at such meeting without compliance with the foregoing provisions with respect to nominations.

SECTION 7. Vacancies. Subject to the provisions of these bylaws with respect to the filling of vacancies caused by the removal of board members by the members, and vacancy occurring on the Board of Directors, other than a vacancy occurring by reason of expiration of the term shall be filled by a majority vote of the remaining members of the Board for the unexpired portion of the term.

SECTION 8. Compensation. Board members shall not receive any salary for their services as such, except that members of the Board may by resolution authorize a fixed sum 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 per diem 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, nor shall any close relative of a board member receive compensation for serving the Cooperative, unless the payment and amount of compensation shall be specifically authorized by a vote of the Board members or the service by the board member or his close relative shall have been certified by the Board as an emergency measure.

ARTICLE V

MEETINGS OF 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 Meeting. Special meetings of the Board may be called by the President of by any three board members, and it shall thereupon be the duty of the Secretary to cause a 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 board 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 member 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 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 VI

OFFICERS

SECTION 1. Number. The officers of the Cooperative shall be a Chairman, Vice-Chairman, Secretary, Treasurer and such other officers as may be determined by the Board of Directors from time-to-time. The officers 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 at the meeting of the board held immediately after the annual meeting of the members. If the election of officers shall not be held at such meeting, such election shall be held as soon thereafter as conveniently may be. Each officer shall hold office until the first meeting of the board following the next succeeding annual meeting of the members or until his successor shall have been elected and shall have qualified. A vacancy in any office shall be filled by the board for the unexpired portion of the term.

SECTION 3. Removal of Officers and Agents by the Board. Any officer or agent elected or appointed by the Board of Directors may be removed by said Board whenever in its judgment the best interests of the Cooperative will be served thereby. In addition, any member of the Cooperative may bring charges against an officer, and by filing with the Secretary such charges in writing together with a petition signed by ten per centum of the members or 300, whichever is the lesser, may request the removal of such officer. The officer against whom such charges have been brought shall be informed in writing of the charges at least ten days prior to the board meeting at which the charges are to be considered and shall have an opportunity at the meeting to be heard in person or by counsel and to present evidence in respect to the charges; and the person or persons bringing the charges against him shall have the same opportunity. In the event the board does not remove the officer, the question of his removal shall be considered and voted upon at the next meeting of the members.

SECTION 4. Chairman. The Chairman shall:

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

(b)sign, with the Secretary, certificates of membership, the issue of which shall have been authorized by the board or the members, 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 Chairman and such other duties as may be prescribed by the board from time-to-time.

SECTION 5. Vice-Chairman. In the absence of the Chairman, or in the event of his inability or refusal to act, the Vice-Chairman shall perform the duties of the Chairman, and when so acting shall have all the powers of and be subject to all the restrictions upon the Chairman. The Vice- Chairman shall also perform such other duties as from time-to-time may be assigned to him by the board.

SECTION 6. Secretary. The Secretary shall be responsible for:

(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 name and post office addresses of all members;


(e)signing, with the President, certificates of membership, the issue of which shall have been authorized by the board or the members;

(f)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

(g)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 7. 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 8. President and Chief Executive Officer. The President and Chief Executive Officer shall:

(a)Be the principal executive officer of the Cooperative and, unless otherwise determined by the members of the Board, have the authority to sign any deeds, mortgages, deeds of trusts, bonds, contracts or other instruments authorized by the Board to be executed, except in cases in which the signature and execution thereof shall be expressly delegated by the Board over these Bylaws to some other officers or agent of the Cooperative, or shall be required by law to be otherwise signed or executed; and

(b)In general, perform all duties incident to the office of President and such other duties as may be prescribed by the Board from time to time.

(c)The President may be, but shall not be required to be, a member of the

Cooperative.

SECTION 9. Bonds of Officers. The Treasurer and any other officer or agent of the Cooperative charged with responsibility for the custody of any of its funds or property shall be bonded in such sum and with such surety as the board shall determine. The board in its discretion may also require any other officer, agent or employee of the Cooperative to be bonded in such amount and with such surety as it shall determine.

SECTION 10. Compensation. The powers, duties and compensation of officers, agents and employees shall be fixed by the board subject to the provisions of these bylaws with respect to compensation for a board member and close relatives of a board member.

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

ARTICLE VII

DISPOSITION OF PROPERTY

The Cooperative may not sell, lease, or otherwise dispose of all or any substantial portion of its property unless such sale, lease or other disposition is authorized at a meeting of the members thereof by the affirmative vote of not less than two-thirds of all of the members of the Cooperative, voting in person or by proxy, and unless the notice of such proposed sale, lease or other disposition shall have been contained in the notice of the meeting, provided, however, that notwithstanding anything herein contained, the Board of the Cooperative, without authorization by the members thereof, shall have full power and authority to authorize 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, all upon such terms and conditions as the Board shall determine, to secure any indebtedness of the Cooperative.

Provided however, the Cooperative may sell, lease or otherwise dispose property in the following categories:

(a) Property that is not necessary in operating and maintaining the system, but sales of such property shall not in any one year exceed ten percent in value of all the property of the Cooperative other than merchandise and property acquired by resale;


(b)Service and electric energy;

(c)Property acquired for resale; and

(d)Merchandise

ARTICLE VIII

NON-PROFIT OPERATION

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 members. No interest or dividends shall be paid or payable by the Cooperative on any capital furnished by its members.

The Cooperative’s current contract with its power supplier, TVA, does not allow for retirement or payment of capital credits.

Section 2. Retirement of Capital Credits. Notwithstanding the provisions of these Bylaws, no member shall have any right to compel the Board of Directors to make retirements on patronage basis, or otherwise, of patronage capital, the retirement thereof being a matter within the sole discretion of the Board of Directors to be exercised or not in accordance with the applicable law and subject to the provisions of any contracts from time to time duly entered into on behalf of the

Cooperative. The Cooperative’s current contract with its power supplier, TVA, does not allow for retirement or payment of capital credits.

Section 3. Patronage Capital in Connection with Furnishing Electric Energy. In the furnishing of electric energy, the Cooperative’s operations shall be so conducted that all members will, through their patronage, furnish capital for the Cooperative. All amounts received and receivable from the furnishing of electric energy to members in excess of operating costs and expenses properly chargeable against the furnishing of electric energy are, at the moment of receipt by the Cooperative, received with the understanding that such amounts are furnished by the members as capital. Capital contributed by the members shall be used only for capital purposes including without limitation new electric system construction, the retirement of electric system indebtedness at or prior to maturity, and working capital adequate for all purposes including facilitation of general rate reductions. All other amounts received by the Cooperative from its operations in excess of costs and expenses shall, insofar as permitted by law, be (a) used to offset any losses incurred during the current or any prior fiscal year and (b) to the extent not needed for that purpose, allocated to its members on a patronage basis and any amount so allocated shall be included as part of the capital credited to the accounts of members, as hereinprovided. The Cooperative shall maintain such books and records as will enable it at any time to compute upon reasonable notice, the amount of capital contributed during any given period by each of its members. All such amounts 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 corresponding aggregate amounts for capital.

In the event of dissolution of the Cooperative, its affairs shall be liquidated in the manner provided by law. The Directors in charge of such liquidation shall use the proceeds derived from liquidation to satisfy and discharge all outstanding liabilities and obligations of the Cooperative. To the extent permitted by law, any remaining proceeds of liquidation shall be disposed of as follows:

The aggregate amount of capital contributed by members of the Cooperative during the period of its existence shall be determined and such remaining proceeds up to such aggregate amounts shall be returned to such members in proportion to the respective amounts of capital contributed by them.

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, if any, may be retired in full or in part. Any such retirements of capital shall be made in order of priority according to the period in which the capital was furnished and credited, the capital first received by the Cooperative being first retired. In no event, however, may any such capital be retired unless after the proposed retirement, the capital of the Cooperative shall equal at least 40 percent of the total assets of the Cooperative.

Capital credited, if any, to the account of each member shall be assignable only on the books of the Cooperative pursuant to written instruction from the assignor and only to successors in interest or successor’s in occupancy in all or a part of such member’s premises served by the Cooperative unless the Board of Directors, acting under policies of general application, shall determine otherwise.

Notwithstanding any other provisions of these Bylaws, the Board of Directors, at its discretion, shall have the power at any time upon the death of any member, if the legal representative of his estate shall request in writing that any capital credited to any such member be retired under the provisions of these Bylaws to retire capital credited, if any, to any such member immediately upon such terms and conditions as the Board of Directors, acting under the policies of general

application, and the legal representatives of member’s estate shall agree upon, provided however, that the financial condition of the Cooperative will not be impaired thereby. The Cooperative’s current contract with its power supplier, TVA, does not allow for retirement of capital credits.

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 fully as though each patron had individually signed a separate instrument containing such terms and provisions.

ARTICLE IX

SEAL

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

ARTICLE X

FINANCIAL TRANSACTIONS

SECTION 1. Contracts. Except as otherwise provided in these bylaws, the board may authorize any officer or officers agents 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 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 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.

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 may select.

SECTION 4. Change in Rates. Written notice shall be given to the Administrator of the Rural Electrification Administration of the United States of America not less than ninety days prior to the date upon which any proposed change in the rates charged by the Cooperative for electric energy becomes effective.

SECTION 5. Fiscal year. The fiscal year of the Cooperative shall begin on the first day of July each year and shall end on the thirtieth day of June of the following year.

ARTICLE XI

MISCELLANEOUS

Section 1. Membership in Other Organizations. The Cooperative shall not become a member of or purchase stock in any other organization without an affirmative vote of the members at a duly held meeting, the notice of which shall specify that action is to be taken upon such proposed membership or stock purchase, provided, however, that the Cooperative may upon the authorization of the board, purchase stock in or become a member of any corporation or organization organized on a non-profit basis for the purpose of engaging in or furthering the cause of rural electrification, or with the approval of the Administrator of REA, of any other corporation for the purpose of acquiring electric facilities.

Section 2. 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 members shall attend a meeting for the express purpose of objecting to the transactions of any business on the ground that the meeting has not been lawfully called or convened.

Section 3. Policies, Rules and Regulations. The board shall have power to make and adopt such policies, rules and regulations, not inconsistent with law, the articles of incorporation or these bylaws, as it may deem advisable for the management of the business and affairs of the Cooperative.

Section 4. Accounting System and Reports. The board shall cause to be established and maintained a complete accounting system which, among other things, and subject to applicable laws and rules and regulations of any regulatory body, shall conform to such accountings system as may from time-to-time be designated by the Administrator of the Rural Electrification Administration of the United States of America. The board shall also after the close of each fiscal year cause to be made by a certified public accountant 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 5. Area Coverage. The board shall make diligent effort to see that electric service is extended to all unserved persons within the Cooperative area who (a) desire such service and (b) meet all reasonable requirements established by the Cooperative as a condition of such service.

Section 6. Indemnification of Officers, Directors, Staff Employees and Agents. The Cooperative shall 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 Cooperative) by reason of the fact that such person is or was a director, officer, staff employee or agent of the cooperative, or who is or was serving at the request of the cooperative as a director, officer, staff employee or agent of another cooperative, association, corporation, partnership, joint venture, trust or other enterprise, against expenses (including all costs of defense), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, if such person acted in good faith and in a manner such person reasonably believed to be in, or not opposed to, the best interest of the Cooperative, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the conduct of such person 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 such person reasonable believed to be in, or not opposed to, the best interests of the Cooperative, and with respect to any criminal action or proceeding, had reasonable cause to believe that the conduct of such person was unlawful.

To the extent that a director, officer, staff employee or agent of the Cooperative has been successful, on the merits or otherwise, in the defense of any action, suit or proceeding referred to in paragraph 1, (and, in addition, actions by or in the right of, the Cooperative) of any claim, issue or matter therein, such person shall be indemnified against expenses (including all costs of defense) actually and reasonably incurred by such person in connection therewith.

The indemnity herein provided shall be co-extensive with those authorized under Kentucky Revised Statute 271A.026 and shall be effective in accordance with all of the terms and conditions of such statute.

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

Section 7. 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 the Cooperative’s Articles of Incorporation or

Bylaws.

Section 8. Advisory Board. The Board of Directors shall select each year an Advisory Board consisting of not less than three (3) nor more than ten (10) from each voting district. The Advisory Board shall serve until their replacements have been selected. The Advisory Board shall advise the Board of Directors on operations of the Cooperative and shall serve as a nominating committee as provided in these bylaws.

Section 9. Right-of-way. 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 to each member and all other members of the

Cooperative and shall permit the Cooperative’s authorized employees, agents and independent contractors to have access thereto for inspection, maintenance, replacement, relocation or repair thereof. As part of the consideration of each 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 effort to prevent others from so doing. 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 could have prevented such, the member shall indemnify the Cooperative and any other person 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. In no event shall the responsibility of the Cooperative extend beyond the point of delivery of the

Cooperative’s service to the customers. The Cooperative shall, 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.

ARTICLE XII

AMENDMENTS

These bylaws may be altered or amended by the affirmative vote of not less than two-thirds (2/3) of the members of the board at any regular or special meeting. A copy of such alteration or amendment shall be sent to each member of the Cooperative within a reasonable time after such action has been taken.

By-Law Amendment Log

Created July 2014

1.Article XI, Section 8, Amended at July 2014 Board Meeting increasing the maximum number of Advisory Board Members from 6 to 10.

2.Article IV, Section 4, Qualifications and Section 5(I), Nominations amended at the January 2015 Board Meeting.