2025-11-13T14:57:54-06:00 2024-12-31 861065772 DELOITTE TAX LLP 1001 WOODWARD AVE SUITE 700 DETROIT MI 48226 990 2024-01-01 431827033 MIDCONTINENT INDEPENDENT SYSTEM OPERATOR INC MIDC 3172495400 720 CITY CENTER DR CARMEL IN 46032 MELISSA BROWN SENIOR VP & CFO 3172495400 2025-11-13 1 1 KRISTYN FORSTER P01704059 3133963000 2024 2025-03-06 01:10:19Z JOHN BEAR 720 CITY CENTER DR CARMEL IN 46032 616374571 0 X WWW.MISOENERGY.ORG X 1998 DE MONITOR AND CONTROL ELECTRIC TRANSMISSION SYSTEM TO PROVIDE NON-DISCRIMINATORY OPEN-ACCESS TO ALL CUSTOMERS AND ENSURE SAFE, RELIABLE, AND EFFICIENT OPERATION FOR THE BENEFIT OF ALL CUSTOMERS. 10 9 1271 0 0 0 119528 465086 400881164 446952846 147062616 158339686 540559 10321317 548603867 616078935 0 0 0 0 219677450 244864488 0 0 0 328926417 371214447 548603867 616078935 0 0 2918427543 3354403000 2918427543 3354403000 0 0 X MONITOR AND CONTROL ELECTRIC TRANSMISSION SYSTEM TO PROVIDE NON-DISCRIMINATORY OPEN-ACCESS TO ALL CUSTOMERS AND ENSURE SAFE, RELIABLE, AND EFFICIENT OPERATION FOR THE BENEFIT OF ALL CUSTOMERS. 0 0 523404431 0 457274163 ON DECEMBER 19, 2001, MIDCONTINENT INDEPENDENT SYSTEM OPERATOR, INC. (MISO OR THE COMPANY) BECAME THE NATION'S FIRST REGIONAL TRANSMISSION ORGANIZATION (RTO) APPROVED BY THE FEDERAL ENERGY REGULATORY COMMISSION (THE FERC). AS AN RTO, MISO PROVIDES TRANSMISSION SERVICE ON BEHALF OF ITS MEMBERS WHO OWN TRANSMISSION ASSETS. IN ADDITION, MISO IS A NORTH AMERICAN ELECTRIC RELIABILITY CORPORATION (NERC) CERTIFIED RELIABILITY COORDINATOR. IN THAT CAPACITY, MISO MONITORS THE FLOW OF ELECTRICITY OVER THE TRANSMISSION SYSTEMS OF ITS MEMBERS WHO OWN TRANSMISSION ASSETS. MISO WAS INCORPORATED AS A DELAWARE NON-STOCK, NONPROFIT CORPORATION IN MARCH 1998. THE COMPANY IS GOVERNED BY AN INDEPENDENT BOARD OF DIRECTORS. MEMBERSHIP IN MISO IS OPEN TO OWNERS OF ELECTRIC TRANSMISSION FACILITIES AS WELL AS OTHER PARTICIPANTS IN THE ELECTRIC ENERGY MARKET. FIFTY-NINE TRANSMISSION OWNERS WITH MORE THAN 77,000 MILES OF TRANSMISSION LINES, 202,000 MEGAWATTS OF ELECTRIC GENERATION, AND APPROXIMATELY $37.9 BILLION IN INSTALLED GROSS TRANSMISSION ASSETS ARE CURRENTLY PARTICIPATING IN MISO. ON DECEMBER 15, 2001, THE COMPANY BEGAN PROVIDING RELIABILITY COORDINATION SERVICES TO THE TRANSMISSION-OWNING MEMBERS OF MISO AND THEIR CUSTOMERS. ON THE SAME DATE, MISO ALSO BEGAN PROVIDING OPERATIONS PLANNING, GENERATION INTERCONNECTION, MAINTENANCE COORDINATION, LONG-TERM REGIONAL PLANNING, MARKET MONITORING, AND DISPUTE RESOLUTION SERVICES. THE COMPANY COMMENCED SUBSTANTIALLY ALL OPERATIONS ON FEBRUARY 1, 2002, THE DATE MISO BEGAN PROVIDING REGIONAL TRANSMISSION SERVICE UNDER ITS FERC-ACCEPTED OPEN ACCESS TRANSMISSION AND ENERGY MARKETS TARIFF (THE TARIFF). ON APRIL 1, 2005, MISO FORMALLY BEGAN OPERATING ITS MARKET-BASED CONGESTION MANAGEMENT SYSTEM WHICH FEATURES THE FOLLOWING: - DAY-AHEAD ENERGY MARKET - REAL-TIME ENERGY MARKET - FINANCIAL TRANSMISSION RIGHTS (FTR) MARKET THE DAY-AHEAD AND REAL-TIME ENERGY MARKETS ARE DESIGNED TO RELIABLY MAKE THE MOST EFFICIENT USE OF ALL GENERATION AND TRANSMISSION RESOURCES WITHIN THE REGION BASED ON BIDS AND OFFERS SUBMITTED BY MARKET PARTICIPANTS. THE DAY-AHEAD AND REAL-TIME ENERGY MARKETS PRICE TRANSMISSION SYSTEM CONGESTION THROUGH THE USE OF LOCATIONAL MARGINAL PRICING (LMP) ALGORITHMS. THE FINANCIAL TRANSMISSION RIGHTS MARKET PROVIDES A MEANS OF HEDGING LMP-BASED CONGESTION COSTS. ON JANUARY 6, 2009, MISO BEGAN OPERATING A MARKET FOR ANCILLARY SERVICES. THE ANCILLARY SERVICES MARKET INTEGRATES THE PROCUREMENT AND USE OF REGULATION AND CONTINGENCY RESERVES WITH THE EXISTING REAL-TIME ENERGY MARKET. MISO ALSO BECAME AN NERC-CERTIFIED BALANCING AUTHORITY ON JANUARY 6, 2009. 523404431 0 0 0 1 0 0 0 0 0 1 0 0 0 1 0 1 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 1 121 0 1 1271 1 0 0 0 0 0 0 1 0 X 10 9 0 0 0 0 1 1 0 1 1 0 0 1 1 1 1 1 1 1 1 0 DC IN X MELISSA BROWN 3172595400 720 CITY CENTER DRIVE CARMEL IN 46032 JOHN BEAR CEO 40.00 0.00 X X 3734846 0 53346 TODD RABA DIRECTOR 10.00 0.00 X 210000 0 0 PHYLLIS CURRIE DIRECTOR 10.00 0.00 X 192500 0 0 HORACE DOGGETT DIRECTOR 10.00 0.00 X 192500 0 0 MARK JOHNSON DIRECTOR 10.00 0.00 X 192500 0 0 BARBARA KRUMSIEK DIRECTOR 10.00 0.00 X 192500 0 0 NANCY LANGE DIRECTOR 10.00 0.00 X 192500 0 0 ROBERT LURIE DIRECTOR 10.00 0.00 X 192500 0 0 THERESA WISE DIRECTOR 10.00 0.00 X 192500 0 0 JEFF LEMMER DIRECTOR (BEG 1/24) 10.00 0.00 X 138750 0 0 CLAIR MOELLER PRESIDENT & COO (THRU 12/24) 40.00 0.00 X 1852895 0 49268 MELISSA BROWN SENIOR VP & CFO 40.00 0.00 X 1243450 0 45197 JENNIFER CURRAN SVP - PLAN & OP & CHIEF COMP. OFF. 40.00 0.00 X 1195658 0 36363 TODD RAMEY SVP - MARKETS & DIGITAL STRATEGY 40.00 0.00 X 1121901 0 53346 ANDRE PORTER SVP & GENERAL COUNSEL 40.00 0.00 X 1127288 0 58935 ALLEGRA NOTTAGE SVP - HR & CHIEF DIVERSITY OFFICER 40.00 0.00 X 733638 0 23976 ERIC MILLER VP & CHIEF INFO SECURITY 40.00 0.00 X 651843 0 51996 AUBREY JOHNSON VP - SYSTEM PLANNING 40.00 0.00 X 635404 0 59086 TODD HILLMAN SVP & CHIEF CUSTOMER OFFICER 40.00 0.00 X 636706 0 65294 RICHARD WAYNE SCHUG VP - STRAT & BUS DVLPMNT (THRU 3/24) 40.00 0.00 X 647287 0 9267 RENUKA CHATTERJEE VP - OPERATIONS 40.00 0.00 X 608897 0 59153 TIMOTHY CAISTER VP - LEGAL FED REGULATORY AFFAIRS 40.00 0.00 X 595137 0 30242 NIRAV SHAH VP - CHIEF DIGITAL & INFO (BEG 5/24) 40.00 0.00 X 433103 0 42275 KRISTINA TRIDICO DEPUTY GENERAL COUNSEL 40.00 0.00 X 578487 0 27572 BRIAN TULLOH E.D. STRAT. COMMS. & POLICY COORD. 40.00 0.00 X 569133 0 55741 DARYL BROWN E.D. EXT AFFAIRS SOUTH 40.00 0.00 X 511100 0 21773 SCOTT WRIGHT E.D. RESOURCE PLANNING 40.00 0.00 X 492452 0 52956 ERIC STEPHENS E.D. SECURITY & FACILITIES 40.00 0.00 X 497494 0 35960 JODY DAVIDS FORMER DIRECTOR 0.00 0.00 X 46250 0 0 MELISSA SEYMOUR FORMER OFFICER 0.00 0.00 X 257055 0 0 RICHARD DOYING FORMER OFFICER 0.00 0.00 X 1126878 0 0 20993152 0 831746 836 1 1 0 GE ENERGY MANAGEMENT SERVICES LLC 10865 WILLOWS ROAD REDMOND WA 98052 SOFTWARE SERVICES 15861753 MONUMENT CONSULTING LLC 3659 WESTMERRE PKWY RICHMOND VA 23233 PROFESSIONAL SERVICES 11098341 POTOMAC ECONOMICS 9990 FAIRFAX BLVD FAIRFAX VA 22030 INDEPENDENT MARKET MONITOR 9785757 TECHNOLOGY SITE PLANNERS INC 8188 BUSINESS WAY PLAIN CITY OH 43064 PROPERTY MANAGEMENT 4798048 UTILICAST PO BOX 38 KIRKLAND WA 98083 PROFESSIONAL SERVICES 3932311 83 465086 465086 COST RECOVERY ADDER 221000 343821980 343821980 FERC ASSESSMENT 221000 76080163 76080163 ENGINEERING STUDIES 221000 25794755 25794755 CONTRACT REVENUE 221000 440613 440613 OTHER TARIFF REVENUE 221000 165224 165224 650111 650111 446952846 158635322 158635322 295636 -295636 -295636 -295636 REGULATORY CREDITS 221000 10321317 10321317 10321317 616078935 457274163 0 158339686 X 17552047 6091691 11460356 1126878 1126878 173678726 132164731 41513995 14285966 9861996 4423970 24723506 18832785 5890721 13497365 9629152 3868213 4294171 3224887 1069284 188383 188383 73879381 67104490 6774891 90 1 89 6788497 5098105 1690392 42503973 39668750 2835223 14255883 10706049 3549834 6170390 2727133 3443257 1277221 914416 362805 100351633 100351633 34950463 34950463 3703757 3703757 FERC ASSESSMENT 76080163 76080163 0 REPAIRS AND MAINTENANCE 3612012 2712591 899421 DUES AND SUBSCRIPTIONS 2384003 1790366 593637 HIRING & RETENTION COST 486971 365711 121260 287456 2440 285016 616078935 523404431 92674504 0 26159180 10868290 2646134530 3088305386 33074267 30376886 0 132808 29919304 29433738 676626595 581662608 77549755 94963987 105590507 100321905 2918427543 3354403000 119625274 133710196 8899802 5439102 274394037 274432129 2515508430 2940821573 2918427543 3354403000 X 0 0 0 0 2918427543 3354403000 0 0 X 0 1 X 1 0 0 1 0 4382790 4382790 76734182 56931759 19802423 42170465 39407865 2762600 95169154 80265382 14903772 458170004 405057602 53112402 94963987 CUSTOMER DEPOSITS 2779031152 MARKET PARTICIPANT LIABILITY 149537845 OBLIGATIONS UNDER OPERATING LEASES (ASC 842) 12252576 2940821573 616374571 0 616374571 -295636 -295636 616078935 616374571 295636 295636 616078935 0 616078935 PART XI, LINE 4B - OTHER ADJUSTMENTS: OTHER LOSSES -295,636. X X X 1 1 X X X X 1 1 0 0 0 0 0 1 0 JOHN BEAR CEO 1006638 0 2270186 0 458022 0 23000 0 30346 0 3788192 0 461459 0 CLAIR MOELLER PRESIDENT & COO (THRU 12/24) 553363 0 1128041 0 171491 0 23000 0 26268 0 1902163 0 167103 0 MELISSA BROWN SENIOR VP & CFO 467707 0 667653 0 108090 0 23000 0 22197 0 1288647 0 112832 0 JENNIFER CURRAN SVP - PLAN & OP & CHIEF COMP. OFF. 481688 0 618608 0 95362 0 0 0 36363 0 1232021 0 98429 0 ANDRE PORTER SVP & GENERAL COUNSEL 459247 0 583561 0 84480 0 23000 0 35935 0 1186223 0 85070 0 TODD RAMEY SVP - MARKETS & DIGITAL STRATEGY 483959 0 559185 0 78757 0 23000 0 30346 0 1175247 0 83884 0 RICHARD DOYING FORMER OFFICER 0 0 0 0 1126878 0 0 0 0 0 1126878 0 0 0 ALLEGRA NOTTAGE SVP - HR & CHIEF DIVERSITY OFFICER 409834 0 299206 0 24598 0 23000 0 976 0 757614 0 21359 0 ERIC MILLER VP & CHIEF INFO SECURITY 298516 0 358647 0 -5320 0 22005 0 29991 0 703839 0 0 0 TODD HILLMAN SVP & CHIEF CUSTOMER OFFICER 373286 0 261671 0 1749 0 29006 0 36288 0 702000 0 0 0 AUBREY JOHNSON VP - SYSTEM PLANNING 358862 0 281272 0 -4730 0 28950 0 30136 0 694490 0 0 0 RENUKA CHATTERJEE VP - OPERATIONS 306108 0 303883 0 -1094 0 23000 0 36153 0 668050 0 0 0 RICHARD WAYNE SCHUG VP - STRAT & BUS DVLPMNT (THRU 3/24) 56573 0 331192 0 259522 0 0 0 9267 0 656554 0 0 0 TIMOTHY CAISTER VP - LEGAL FED REGULATORY AFFAIRS 311913 0 289691 0 -6467 0 0 0 30242 0 625379 0 0 0 BRIAN TULLOH E.D. STRAT. COMMS. & POLICY COORD. 290393 0 281063 0 -2323 0 26136 0 29605 0 624874 0 0 0 KRISTINA TRIDICO DEPUTY GENERAL COUNSEL 299305 0 285217 0 -6035 0 6000 0 21572 0 606059 0 0 0 SCOTT WRIGHT E.D. RESOURCE PLANNING 266887 0 231756 0 -6191 0 23000 0 29956 0 545408 0 0 0 ERIC STEPHENS E.D. SECURITY & FACILITIES 271952 0 223950 0 1592 0 23000 0 12960 0 533454 0 0 0 DARYL BROWN E.D. EXT AFFAIRS SOUTH 277317 0 239187 0 -5404 0 0 0 21773 0 532873 0 0 0 NIRAV SHAH VP - CHIEF DIGITAL & INFO (BEG 5/24) 286362 0 150000 0 -3259 0 22996 0 19279 0 475378 0 0 0 MELISSA SEYMOUR FORMER OFFICER 0 0 218438 0 38617 0 0 0 0 0 257055 0 0 0 TODD RABA DIRECTOR 210000 0 0 0 0 0 0 0 0 0 210000 0 0 0 PHYLLIS CURRIE DIRECTOR 192500 0 0 0 0 0 0 0 0 0 192500 0 0 0 HORACE DOGGETT DIRECTOR 192500 0 0 0 0 0 0 0 0 0 192500 0 0 0 MARK JOHNSON DIRECTOR 192500 0 0 0 0 0 0 0 0 0 192500 0 0 0 BARBARA KRUMSIEK DIRECTOR 192500 0 0 0 0 0 0 0 0 0 192500 0 0 0 NANCY LANGE DIRECTOR 192500 0 0 0 0 0 0 0 0 0 192500 0 0 0 ROBERT LURIE DIRECTOR 192500 0 0 0 0 0 0 0 0 0 192500 0 0 0 THERESA WISE DIRECTOR 192500 0 0 0 0 0 0 0 0 0 192500 0 0 0 JODY DAVIDS FORMER DIRECTOR 46250 0 0 0 0 0 0 0 0 0 46250 0 0 0 PART I, LINE 1A CHARTER TRAVEL - MIDCONTINENT INDEPENDENT SYSTEM OPERATOR, INC. USED CHARTER TRAVEL DURING CALENDAR YEAR 2024. NON-QUANTITATIVE FACTORS, AS WELL AS THE COST BENEFIT, WERE CONSIDERED FOR EACH TRIP. ALL EMPLOYEES ARE ABLE TO USE CHARTER TRAVEL. CHARTER TRAVEL IS NOT INCLUDED IN TAXABLE INCOME AS IT IS A BUSINESS EXPENSE. FIRST CLASS TRAVEL - EXCEPTIONS FOR FIRST CLASS TRAVEL CAN BE GRANTED BY OFFICERS. DURING CALENDAR YEAR 2024, DUE TO DISTANCE, FIVE OFFICERS TRAVELED FIRST CLASS TO ATTEND CONFERENCES HELD IN EUROPE AND ASIA. TRAVEL IS NOT INCLUDED IN TAXABLE INCOME AS IT IS A BUSINESS EXPENSE. TRAVEL FOR COMPANIONS - WHEN SPOUSES ARE INVITED BY THE BOARD OR CEO TO ATTEND EVENTS IN CONJUNCTION WITH BUSINESS MEETINGS, THE EXPENSES OF THE SPOUSES ARE REIMBURSABLE. DURING CALENDAR YEAR 2024, TWO DIRECTOR'S COMPANIONS WERE INVITED TO A HOLIDAY PARTY. TRAVEL WAS NOT REPORTED AS TAXABLE INCOME. HOUSING ALLOWANCE OR RESIDENCE FOR PERSONAL USE - RESIDENCE (APARTMENT) IN CARMEL IS AVAILABLE FOR OFFICERS THAT DO NOT LIVE IN CARMEL, IN LIEU OF A HOTEL, AFTER A COST BENEFIT ANALYSIS WAS DONE WHICH REVEALED IT WAS MORE COST EFFECTIVE. HOUSING IS NOT INCLUDED IN TAXABLE INCOME AS IT IS A BUSINESS EXPENSE PART I, LINE 4A: UNDER AN INVOLUNTARY TERMINATION DUE TO POSITION ELIMINATION FROM A JOB RESTRUCTURING, REDUCTION IN FORCE, OR REORGANIZATION, AN EMPLOYEE IS ELIGIBLE FOR SEVERANCE BENEFITS INCLUDING, SALARY CONTINUATION, PAYMENT OF COBRA, AND OUTPLACEMENT SERVICES. SEVERANCE PAYMENTS ARE DETERMINED BY A BASELINE SEVERANCE, I.E., THE EMPLOYEE'S GRADE AT MISO AS OF THE SEVERANCE DATE, AND YEARS OF CONSECUTIVE SERVICE. THE EMPLOYEE IS REQUIRED TO SIGN A RELEASE IN ORDER TO RECEIVE THE SEVERANCE COMPENSATION AND BENEFITS. SEVERANCE PAYMENTS WERE MADE DURING CALENDAR YEAR 2024 TO THE FOLLOWING LISTED PERSONS IN PART VII: RICHARD DOYING - $1,126,878 MELISSA SEYMOUR - $38,617 PART I, LINE 4B: THE CONTRIBUTIONS CREDITED TO A PARTICIPANT'S SERP ACCOUNT FOR A GIVEN PLAN YEAR SHALL BE EQUAL TO THE FOLLOWING AMOUNTS: A. THE AMOUNT OF EMPLOYER CONTRIBUTIONS CREDITED TO A PARTICIPANT'S ACCOUNT FOR A GIVEN PLAN YEAR SHALL BE EQUAL TO 15% OF THE PARTICIPANT'S PLAN YEAR COMPENSATION. B. EMPLOYER MAY, AT ITS SOLE DISCRETION, MAKE ADDITIONAL CONTRIBUTIONS FOR ANY ONE PARTICIPANT OR ALL PARTICIPANTS. C. THE CONTRIBUTION FOR CEO COMPENSATION SHALL BE 20% OF PLAN YEAR COMPENSATION. FOR THE PURPOSE OF DETERMINING THE EMPLOYER CONTRIBUTION, THE PARTICIPANT'S PLAN YEAR COMPENSATION SHALL BE PRORATED FOR A PARTIAL PLAN YEAR OF ACTIVE PARTICIPATION. THE EMPLOYER MAY, AT ITS SOLE DISCRETION, MAKE ADDITIONAL CONTRIBUTIONS FOR ANY ONE PARTICIPANT OR ALL PARTICIPANTS OF THE PLAN YEAR FOR WHICH THE CONTRIBUTIONS ARE MADE. THE FOLLOWING INDIVIDUAL LISTED ON PART VII RECEIVED SUPPLEMENTAL NON-QUALIFIED PLAN PAYMENTS DURING THE CALENDAR YEAR: RICHARD WAYNE SCHUG - $238,194 PART I, LINE 7: EVERY REGULAR FULL TIME EMPLOYEE HAS THE OPPORTUNITY TO EARN AN INCENTIVE AWARD BASED ON THE ACHIEVEMENT OF CORPORATE GOALS. WHEN ELIGIBILITY IS ESTABLISHED, A TARGET PAYOUT FOR SHORT TERM INCENTIVE PERFORMANCE IS ESTABLISHED FOR THE EMPLOYEE. THIS TARGET MAY DEPEND ON A NUMBER OF FACTORS INCLUDING THE EMPLOYEE'S ROLE IN THE ORGANIZATION, THE EMPLOYEE'S IMPACT ON ACHIEVING THE LONG TERM GOALS, OR MARKET FACTORS. THESE TARGETS MAY BE ADJUSTED FOR INDIVIDUAL EMPLOYEES AT THE DISCRETION OF THE BOARD OR THE CHIEF EXECUTIVE OFFICER FOR NON-OFFICER PLAN PARTICIPANTS. RWS STRATEGIES INC FORMER VP - STRAT & BUS DVLPMT OWNS MORE THAN 35% OF RWS STRATEGIES, INC. 175200 CONSULTING SERVICES 0 FORM 990, PART VI, SECTION A, LINE 6 MEMBERS OR STOCKHOLDERS MEMBER CAN BE A REPRESENTATIVE OF ONE ENTITY OR MAY BE A SINGLE MEMBERSHIP REPRESENTING SEVERAL ENTITIES THAT SHARE A MEMBERSHIP AND HOLD A SINGLE VOTE. APPLICANTS MAY JOIN ONE OF TEN SECTORS: TRANSMISSION OWNER; INDEPENDENT POWER PRODUCERS AND EXEMPT WHOLESALE GENERATORS; POWERMARKETERS AND BROKERS; MUNICIPALS, COOPERATIVES, AND TRANSMISSION DEPENDENT UTILITIES; PUBLIC CONSUMER ADVOCATES; STATE REGULATORY AUTHORITIES; ENVIRONMENTAL; ELIGIBLE END USE CUSTOMERS; COMPETITIVE TRANSMISSION DEVELOPERS; AFFILIATES OR COORDINATING MEMBERS. FORM 990, PART VI, SECTION A, LINE 7A POWER TO ELECT OR APPOINT MEMBERS ARTICLE TWO, SECTION V(B)(5) OF THE TRANSMISSION OWNERS AGREEMENT SETS OUT THE VOTING RIGHTS OF ALL MEMBERS OF MIDCONTINENT INDEPENDENT SYSTEM OPERATOR, INC. MEMBERS ARE DEFINED IN THE TRANSMISSION OWNERS AGREEMENT AS A PERSON OR BUSINESS ENTITY WHICH IS (I) AN ELIGIBLE CUSTOMER, AS DEFINED IN THE TARIFF, OR (II) AN OWNER, AS DEFINED IN THE TRANSMISSION OWNERS AGREEMENT, AND WHICH PAYS TO MIDCONTINENT INDEPENDENT SYSTEM OPERATOR, INC. THE NON-REFUNDABLE MEMBERSHIP FEES FORM 990, PART VI, SECTION B, LINE 11B PROCESS TO REVIEW THE FORM 990 AN OUTSIDE ACCOUNTING FIRM PREPARES THE RETURN BASED ON INFORMATION PROVIDED BY THE FILING ORGANIZATION. THE CFO, PRESIDENT & CEO, AND LEGAL DEPARTMENT COMPLETE THE INITIAL REVIEW. THE BOARD OF DIRECTORS IS THEN PRESENTED WITH COPIES AND ARE GIVEN THE OPPORTUNITY TO ASK QUESTIONS AND PROVIDE COMMENTS TO THE EXECUTIVE TEAM BEFORE THE RETURN IS FILED WITH THE IRS. FORM 990, PART VI, SECTION B, LINE 12C MONITORING AND ENFORCEMENT OF COMPLIANCE WITH CONFLICT OF INTEREST CONFLICTS OF INTEREST ARE ADDRESSED IN BOTH THE MIDCONTINENT INDEPENDENT SYSTEM OPERATOR, INC. (MISO) EMPLOYEE HANDBOOK AS WELL AS IN THE STANDARDS OF CONDUCT, FOUND IN THE TRANSMISSION OWNERS AGREEMENT, WHICH IS PART OF MISO'S TARIFF. THE HANDBOOK IS REVIEWED AT NEW HIRE ORIENTATION AND ALL NEW HIRES VERIFY THAT THEY HAVE READ AND UNDERSTAND THE HANDBOOK. THE HANDBOOK IS ALSO PART OF MISO'S ANNUAL RECERTIFICATION PROCESS, IN WHICH ALL EMPLOYEES, ON AN ANNUAL BASIS, CERTIFY THAT THEY HAVE REVIEWED THE HANDBOOK AND AGREE TO COMPLY WITH THE HANDBOOK (INCLUDING ITS CONFLICT OF INTEREST PROVISIONS) AND OTHER MISO POLICIES. EACH MEMBER OF MISO'S BOARD OF DIRECTORS RECEIVES ANNUAL TRAINING ON THE STANDARDS OF CONDUCT AND CERTIFIES THAT THEY ARE COMPLIANT WITH THE STANDARDS OF CONDUCT, INCLUDING THE CONFLICT OF INTEREST PROVISIONS. FORM 990, PART VI, SECTION B, LINE 15 PROCESS FOR DETERMINING COMPENSATION THE BOARD RETAINS THE SERVICE OF EXPERT OUTSIDE EXECUTIVE COMPENSATION CONSULTANTS ('THE CONSULTANTS') IN THE MARKET REVIEW OF OFFICER COMPENSATION. ANNUALLY, THE CONSULTANTS PERFORM A FULL AND INDEPENDENT STUDY OF ALL OFFICER TOTAL RENUMERATION COMPENSATION (BASE PLUS INCENTIVES PLUS BENEFITS). THE CONSULTANTS CONSIDER THE LEVEL OF COMPENSATION RELATIVE TO THE DUTIES PERFORMED; THE CURRENT COMPETITIVE MARKET FOR SIMILAR SKILLS, KNOWLEDGE, AND RESPONSIBILITY; AND OTHER STRATEGIC NEEDS IDENTIFIED BY THE CEO AND BOARD OF DIRECTORS. THE CONSULTANTS PREPARE AND DELIVER A FULL DETAILED COMPENSATION MARKET DATA REPORT TO THE HUMAN RESOURCES COMMITTEE BOARD OF DIRCTORS ('HRC'). THIS REPORT INCLUDES RECOMMENDATIONS FOR DIRECT COMPENSATION CHANGES. THE CEO COMBINES THE MARKET DATA COMPENSATION WITH EVALUATIONS OF OFFICER PERFORMANCE TO RECOMMEND APPROPRIATE COMPENSATION LEVELS TO THE BOARD OF DIRECTORS FOR APPROVAL. THE CONSULTANTS PREPARE AND DELIVER A FULL DETAILED COMPENSATION MARKET DATA REPORT TO THE HRC FOR THE CEO. THE HRC COMBINES THE MARKET DATA COMPENSATION, EVALUATION OF PERFORMANCE, AND RECOMMENDATION FOR APPROPRIATE COMPENSATION LEVELS TO THE HRC FOR APPROVAL. ANNUALLY THE CONSULTANT PREPARES A LETTER OF 'REASONABLENESS' OF THE TOTAL REMUNERATION PACKAGE FOR OFFICERS OF THE COMPANY. THIS LETTER IS CONSISTENT WITH THE GUIDELINES OF SECTION 4958 OF THE INTERNAL REVENUE CODE. THIS LETTER CERTIFIES THAT IN THE 'REASONED OPINION' OF THE CONSULTANT AS AN 'INDEPENDENT EVALUATION EXPERT' THE COMPENSATION AND BENEFITS PROVIDED TO THE OFFICERS REPRESENT 'REASONABLE COMPENSATION'. THE HRC REVIEWS METRICS RESULTS FROM MIDCONTINENT INDEPENDENT SYSTEM OPERATOR, INC.'S SHORT-TERM INCENTIVE PLANS. NO INCENTIVES ARE PAID UNTIL RECOMMENDED BY THE HRC AND APPROVED BY THE BOARD. THE HRC REVIEWS AND RECOMMENDS ANY NEW OR MODIFIED EMPLOYMENT CONTRACTS WITH THE PRESIDENT, CEO AND OFFICERS, INCLUDING RETENTION AGREEMENTS WHICH THEN MUST BE APPROVED BY THE BOARD. FROM TIME TO TIME, THE HRC WILL RETAIN THE SERVICES OF OUTSIDE CONSULTANTS TO EVALUATE AND MAKE RECOMMENDATIONS TO THE LEVEL AND TYPE OF SPECIFIC COMPENSATION AND BENEFIT ITEMS. THE HRC ROUTINELY REPORTS TO AND, IF REQUIRED, OBTAINS APPROVAL FROM THE FULL BOARD ON THESE MATTERS. FORM 990, PART VI, SECTION C, LINE 19 PROCESS FOR MAKING DOCUMENTS AVAILABLE TO THE PUBLIC THE MIDCONTINENT INDEPENDENT SYSTEM OPERATOR, INC.'S GOVERNING DOCUMENTS CAN BE FOUND ON OUR WEBSITE UNDER THE 'LEGAL' TAB. THESE DOCUMENTS ARE THE TARIFF AND THE TRANSMISSION OWNERS AGREEMENT WHICH INCLUDES THE COMPANY'S STANDARDS OF CONDUCT (APPENDIX A) AND THE COMPANY'S BYLAWS (APPENDIX F). THESE DOCUMENTS ARE ALSO FILED WITH AND AVAILABLE ON THE FERC'S WEBSITE AT WWW.FERC.GOV IN THE LIBRARY. THE FINANCIAL STATEMENTS OF MIDCONTINENT INDEPENDENT SYSTEM OPERATOR, INC. ARE CONTAINED IN THE COMPANY'S ANNUAL REPORT WHICH IS ALSO LOCATED ON OUR WEBSITE AT WWW.MISOENERGY.ORG. FORM 990, PART IX, LINE 11G PROFESSIONAL SERVICES: PROGRAM SERVICE EXPENSES 67,104,490. MANAGEMENT AND GENERAL EXPENSES 6,774,891. FUNDRAISING EXPENSES 0. TOTAL EXPENSES 73,879,381.