Jackson Energy Cooperative

“Line 2 explanation - director hays part owner of local bank where jackson energy conducts banking business. Also, owns cable television company which pays joint use attachment fee to jackson energy thru rates regulated by ky public service commission.”

“Line 6 explanation - must be a member to receive electric service. Each member has 1 vote. May have more than 1 service per membership.”

“Line 7a explanation - nominating committee meets every year to select candidate to run for board position. A member may, upon obtaining 500 written member names, run for a board position.”

“Line 7b explanation - articles of incorporation may be altered, provided that notice of the meeting shall have contained a copy of the proposed alteration, amendment, or repeal.”

“Line 11b explanation - directors are furnished a draft copy of the 990 for review prior to filing. May make inquiries of information contained in the return. Directors also meet with the independent auditor in a closed session and are able to make additional inquiries at that time.”

“The governing body and key employees are aware of the issues involving the appearance of, and conflicts of interest and family and business relationships,and the need to disclose these relationships, if applicable. There are ongoing discussions with the governing body and key employees regarding related party transactions. There is an annual review by the independent auditor and an annual review by the cooperative's attorney.”

“15.a. The board annually evaluates the performance of the president/ceo; raises are determined by the summation of the 9 evaluations. The board utilizes a third party organization, hr performance solutions, to provide compensation data which is reviewed by the board.”

“Bylaws are given to each new member and financial statements are given to each member on an annual basis. Annual meeting of members is held each year.”

“Comprehensive income postretirement benefits 48,576. Margins allocated to customers 6,738,542. Refund of capital credits -599,664. Memberships issued, net -380,885. Other equities 402,206.”

“Form 990, part ix, line 4 - benefits paid to or for members represents patronage capital allocated to members in accordance with the bylaws of the cooperative. This results in a difference between book income and income reported on the form 990 by the same amount.”