Section 1: Board-Approved Acquisitions and Dispositions
An affirmative vote of ⅔ of the Board may authorize, in any one year, acquisition or disposition of an asset or property that has a price equal to or less than 20% of the total assets of the Cooperative.
Section 2: Membership-Approved Acquisitions
A majority vote of the membership, by ballot, shall authorize acquisition of any single asset or property greater than 20% of the total assets of the Cooperative.
Section 3: Membership-Approved Dispositions
The Cooperative shall not sell, lease, exchange, or otherwise dispose of property or assets (other than as provided in Article XIV), in any one year, in excess of 20% of the value of all property or assets unless all of the following occur:
The Board appoints 3 independent appraisers each of whom, within a reasonable period of time, evaluates the Cooperative’s assets and renders an appraisal valuing the Cooperative’s specified assets. These appraisals shall be paid for by the entity desiring to purchase the assets.
The Board approves the transaction.
Members are notified at least 90 days in advance of a meeting to vote on acquisition or disposition of assets or property and the terms of the proposed transaction.
If the proposed transaction is to dispose of Cooperative assets, at least thirty (30) days before the member meeting, the Cooperative shall invite all other electric cooperatives in the State of Montana to submit proposals to acquire the Cooperative’s specified assets.
Members are mailed, at least 30 days before the member meeting, any alternative proposal made by Cooperative members, if it has been submitted to the Board with dated signatures, printed names, addresses and phone numbers of 50 or more members.
A vote of at least ⅔ of the total membership approves the transaction by ballot.
The Cooperative allocates and credits to members as capital credits any consideration received for the specified assets in excess of the Cooperative’s debts, obligations and liabilities on those specified assets. The Cooperative shall allocate these credits in proportion to each member’s Patronage Capital to the total Patronage Capital. This will be done via a special allocation after the annual allocation.
In the case of a purchase of all Cooperative property by a third party, that party shall pay at least fair market value for the property, pay off all debts of the Cooperative, and return all capital credits in full to all members of the Cooperative.
The Cooperative may merge or consolidate with any one or more cooperatives by complying with the following:
The proposal for merger or consolidation shall have been approved by two-thirds (2/3) of the Board of Trustees.
The proposed merger or consolidation plan shall be submitted to the membership at an annual or special membership meeting. The notice for such meeting shall set forth the full particulars of the proposed merger or consolidation.
The proposal for merger or consolidation and the proposed articles of the merged or new entity shall be approved by ⅔ of the members voting thereon at the meeting.
The Cooperative may indemnify any officer, trustee, employee, or agent of the Cooperative who is made a party to a proceeding because of that relationship if the individual (a) conducted business in good faith; (b) reasonably believed their conduct was in the best interest of the Cooperative; and (c) in the case of a criminal proceeding, had no reasonable cause to believe the action taken was unlawful. There shall be no indemnification in connection with a proceeding by the Cooperative in which the party is adjudged liable to the Cooperative, or if in a proceeding the party is found to have improperly received personal benefit from their actions. This indemnification is limited to reasonable expenses incurred in connection with the proceeding.
The determination to indemnify must be made by the Board of Trustees based upon majority vote of a quorum consisting of trustees who are not parties to the proceeding.
The Cooperative shall purchase and maintain reasonable insurance on behalf of an individual who is or was an officer, trustee, employee or agent of the Cooperative, against liability asserted or incurred by the individual in that capacity or arising from their status as an officer, trustee, employee or agent of the Cooperative.
Except as otherwise provided in these Bylaws, the Board, at any regularly scheduled meeting or any special meeting called for the purpose, 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 the behalf of the Cooperative, and such authority may be general or confined to specific instances.
Section 2: Checks, Drafts, Etc.
Except as otherwise provided by law or in these Bylaws, all checks, drafts, or other orders for payment of money, and all notes, bonds or other evidence of indebtedness issued in the name of the Cooperative shall be signed by such officer, officers, agent or agents of the Cooperative and in such manner as shall from time to time be determined by resolution of the Board of Trustees.
Section 3: Deposits
All funds 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: Fiscal Year
The fiscal year of the Cooperative shall begin on the first day of January of each year and end on the thirty-first day of December of the same year.
The rules contained in the current edition of Robert’s Rules of Order shall govern the meetings of the Cooperative, so long as these rules are not inconsistent with federal, state or local law, the Articles of Conversion, and these Bylaws. The Board of Trustees may designate a person to act as parliamentarian for the purpose of interpreting said rules.
These Bylaws may be amended in conjunction with any regular or special meeting of the members by a majority of those voting by ballot, provided a summary of all amendments is included, in writing, with the ballot. The full text of amendments will be available by request and on the Cooperative website.
All titles and headings of the articles in these Bylaws, sections, and subsections are for convenience and reference only and do not affect the interpretation of any Bylaw article, section or subsection.
The foregoing bylaws were amended by a vote of the members of Flathead Electric Cooperative on April 12, 2021.
Any individual or entity shall be eligible to apply for membership who has the capacity to enter into legally binding contracts and who consumes, receives, purchases, or otherwise uses:
Electric power or energy generated, transmitted, distributed, sold, supplied, furnished, or otherwise provided; or
Any other good or service provided by the Cooperative and, as determined by the Cooperative, reasonably relates to the person using electric power or energy.
No person, either individually or through an entity not considered legally separate from its members, owners, or participants, may hold more than 1 membership.
Membership shall become effective upon completing the membership application to the Cooperative’s satisfaction and receiving a Cooperative service.
Section 2: Membership Classifications
The Cooperative may have one or more classes of membership to accommodate various types of service. If the Cooperative has more than one class of membership, the Board of Trustees shall determine, under rules of general application, the definition, rights, and obligations of each class, including the method for allocating patronage capital.
Section 3: Joint Membership
2 natural persons may be issued a joint membership. Joint members are subject to the following conditions:
The joint membership shall be entitled to one vote at a meeting of the members.
Notice to one member of a joint membership shall constitute notice to both members;
The presence of one member of a joint membership, at a meeting, shall be regarded as the presence of the member; and
The waiver in writing or the presence at a meeting of one member of a joint membership waives notice of the meeting by the joint membership.
The suspension or termination of either member of a joint membership constitutes suspension or termination of both members of the joint membership.
Either member of a joint membership, but only one, may be elected or appointed as an officer or trustee, if individually qualified.
Upon the death of either member of a joint membership, such membership shall be transferred to an individual membership. However, the estate of the deceased member shall not be released from any debts due the Cooperative.
Members of a joint membership are jointly and individually liable to the Cooperative for the membership’s obligations.
Section 4: Suspension or Termination of Membership or Service
The Cooperative may suspend or terminate membership:
Upon request of the member;
For failure of the member to comply with the Articles of Conversion, these Bylaws, or policies of the Cooperative.
Membership may be suspended or terminated if the member dies or if the membership is legally dissolved or legally ceases to exist.
Membership shall terminate effective when the member ceases to receive electric service from the Cooperative. Upon termination of membership, a terminated member shall retain the right to receive capital credit retirements.
Suspension or termination of membership does not forgive any amount owed to the Cooperative at the time of suspension or termination.
The Board shall establish policy regarding review and appeal of any suspension or termination.
The purpose of this member-owned Cooperative is to provide competitive and reliable services, achieve the highest level of member satisfaction and enhance the quality of life in our communities.
