2014-11-06T08:53:04-06:00 2013-12-31 ERNST & YOUNG US LLP 111 MONUMENT CIRCLE SUITE 4000 INDIANAPOLIS IN 46204 990 2013-01-01 431827033 MIDCONTINENT INDEPENDENT SYSTEM OPERATOR INC % JOSEPHINE BIGGERS MIDC 5132495400 PO BOX 4202 Suite CARMEL IN 46082 JOSEPHINE BIGGERS VICE PRES. 2014-11-06 2013 2015-11-30 17:44:51Z JOHN BEAR PO BOX 4202 CARMEL IN 46032 308773686 false X www.misoenergy.org X 1998 DE MONITOR AND CONTROL ELECTRIC TRANSMISSION SYSTEM TO PROVIDE NON-DISCRI SYSTEM TO PROVIDE NON-DISCRIMINATORY OPEN-ACCESS TO ALL CUSTOMERS AND ENSURE SAFE, RELIABLE, AND EFFICIENT OPERATION FOR THE BENEFIT OF ALL. 8 7 903 0 0 0 519368 3116978 281879274 293825892 1045626 463460 15456447 11273963 298900715 308680293 0 0 0 0 113063352 125263875 0 0 0 185837363 183416418 298900715 308680293 0 674233858 912014925 674233858 912014925 0 0 X MONITOR AND CONTROL AN ELECTRIC TRANSMISSION SYSTEM THAT PROVIDES ALL CUSTOMERS WITH OPEN ACCESS TO THE SYSTEM WITHOUT DISCRIMINATION AND ENSURE SAFE, RELIABLE, AND EFFICIENT OPERATION FOR THE BENEFIT OF ALL CUSTOMERS. false false 265999740 305099855 ON DECEMBER 19, 2001, THE 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. THIRTY TRANSMISSION OWNERS WITH MORE THAN 65,800 MILES OF TRANSMISSION LINES, 201,390 MEGAWATTS OF ELECTRIC GENERATION, AND APPROXIMATELY $20.0 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: O DAY-AHEAD ENERGY MARKET O REAL-TIME ENERGY MARKET O 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. FTRS PROVIDE 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. On December 1, 2012, MISO assumed the role of the independent coordinator of transmission (ICT) for the Entergy system from Southwest Power Pool (SPP) effective until Entergy fully integrated into MISO on December 19, 2013. As ICT for the Entergy region, MISO served as the reliability coordinator and tariff administrator, managed long-term transmission planning, and conducted Entergy's weekly power procurement process. On December 19, 2013, a four-state region of the electric grid across the South integrated into MISO's existing footprint in the Midwest adding over 18,000 miles of transmission and 50,000 megawatts of generation capacity. The integration added 10 new transmission owning companies, six local balancing authorities, and 33 new market participants from Mississippi, Louisiana, Arkansas, Texas, and Missouri to MISO. This new region - referred to as MISO South - includes the following transmission owners and local balancing authorities: Entergy (Arkansas, Mississippi, Louisiana, Texas, Gulf States, and New Orleans), Cleco Corp. (CLECO), Lafayette Utilities System, Louisiana Energy and Power Authority, Louisiana Generating, South Mississippi Electric Power Association (SMEPA), and East Texas Electric Cooperative (ETEC). 265999740 false false false false false false false false false true false false true true false true false false false false false false false false false false false false true false false false false false false false false false false false false false false false false true 186 0 true 903 true false false false false false false X 8 7 false false false false true true false true true false false true true true true true true true true false DC IN X X JOSEPHINE BIGGERS 3172495400 POBOX 4202 CARMEL IN 46032 Paul Feldman DIRECTOR 6.0 0.0 X 120500 0 15000 J Michael Evans DIRECTOR 6.0 0.0 X 129625 0 15000 Michael Curran DIRECTOR 6.0 0.0 X 135625 0 15000 Judy Walsh DIRECTOR 6.0 0.0 X 120916 0 15000 Baljit Dail DIRECTOR 6.0 0.0 X 123750 0 15000 Shelley Longmuir DIRECTOR 6.0 0.0 X 135083 0 15000 Eugene Zeltmann DIRECTOR 6.0 0.0 X 131000 0 15000 John Bear PRESIDENT & CEO 40.0 0.0 X X 1741490 0 294282 Richard Doying Exec VP Ops and Corp 40.0 0.0 X 712834 0 95716 Bryan Kearney VP - INFo Svcs (thru 5/13/13) 40.0 0.0 X 555765 0 123307 Stephen Kozey SR VP - Lgl & Compliance SVCS 40.0 0.0 X 789173 0 125697 Clair Moeller Exec VP - Transmisson & Tech 40.0 0.0 X 765336 0 122169 William Phillips VP - RELIABILITY & SECUR. REL. 40.0 0.0 X 526356 0 79970 Greg Powell VP - HUMAN RESOURCES 40.0 0.0 X 455252 0 85731 Loyd A Warnock Sr VP - External Affairs 40.0 0.0 X 705180 0 92905 Robert B Berntsen VP - Policy and Public Affairs 40.0 0.0 X 360720 0 61950 Jennifer Curran VP - Transmissions 40.0 0.0 X 341614 0 59542 Joseph Gardner VP Forward Markets and Ops 40.0 0.0 X 361347 0 67091 Todd Hillman VP - CUST & STKHLDR RELATIONS 40.0 0.0 X 346975 0 58644 Todd Ramey VP System Ops and Markets 40.0 0.0 X 360946 0 67267 Richard Schug VP Stragegy & Business Develop 40.0 0.0 X 335420 0 58442 Josephine Biggers VP of Finance 40.0 0.0 X 449915 0 69245 Kurt W Bilas Exec Dir Gov't Relations 40.0 0.0 X 306454 0 37696 Lori Spence Deputy General Counsel 40.0 0.0 X 312371 0 35647 Gregory Troxell Assistant General Counsel 40.0 0.0 X 299845 0 31808 Douglas Chapman Exec Dir IT Infrastructure 40.0 0.0 X 294417 0 37174 Christopher Hoffman Shift Manager 40.0 0.0 X 265575 0 29726 11183484 0 1739009 376 false true false Alstom Grid Inc 10865 WILLOWS ROAD REDMOND WA 98052 SOFTWARE SERVICES 11910828 MONUMENT CONSULTING 3659 WESTMERRE PKWY RICHMOND VA 23233 Prof svcs/consulting 7639519 UTILICAST PO BOX 38 KIRKLAND WA 98083 prof svcs/consulting 5693897 VENABLE BAETJER PO BOX 62727 BALTIMORE MD 21264 LEGAL SERVICES 4558430 POTOMAC ECONOMICS 9990 FAIRFAX BLVD FAIRFAX VA 22030 indep mrkt mntr svcs 3907413 70 0 3116978 0 3116978 Cost Recovery Adder 525990 232035797 232035797 0 0 FERC Assessment 525990 34701005 34701005 0 0 Other Tariff Services 525990 3887387 3887387 0 0 Contract Revenue 525990 15506084 15506084 0 0 Engineering Studies 525990 4739249 4739249 0 0 2956370 2956370 0 0 293825892 502053 502053 0 0 0 0 0 54800 93393 -38593 -38593 -38593 0 0 0 0 Regulatory Credits 900099 10383609 10383609 0 0 OTHER INCOME 900099 890354 890354 0 0 11273963 308680293 305099855 0 463460 0 0 0 0 0 0 0 0 7958216 3626188 4332028 0 0 0 0 91005841 75189502 15816339 0 7680865 5684619 1996246 0 11905041 9536971 2368070 0 6713912 5686871 1027041 0 151129 0 151129 0 9429411 7509651 1919760 0 158423 0 158423 0 0 0 0 0 0 0 0 0 0 0 32091666 26124319 5967347 0 0 0 0 0 8670536 7435288 1235248 0 17607868 17454174 153694 0 0 0 0 0 13108934 10738390 2370544 0 5302711 2978622 2324089 0 0 0 0 0 256662 144242 112420 0 8568143 8568143 0 0 0 0 0 49668109 49668109 0 1959034 75110 1883924 0 FERC Assessment 34701005 34701005 0 0 MEMBERSHIP/DUES 592848 315424 277424 0 HIRING/RETENTION COSTS 578343 409763 168580 0 BANK CHARGES 280503 280503 0 291093 153349 137744 308680293 265999740 42680553 0 0 952870 6904364 428314389 667872952 0 0 28698932 26729872 0 0 0 0 639 69357 0 0 9124272 9529008 478779428 328537576 133052608 150241852 0 0 0 0 0 0 0 0 74090148 50667520 674233858 912014925 112062083 113415340 0 0 71305291 57301654 0 0 0 0 0 0 795815 627445 149999995 217857142 340070674 522813344 674233858 912014925 X 0 0 0 0 0 0 0 0 674233858 912014925 0 X false true X true true true 4774753 4774753 67726637 14654156 53072481 8752989 4656304 4096685 60791313 30375899 30415414 336733736 278851217 57882519 150241852 DEFERRED REGULATORY ASSET 29084545 CONSTRUCTION IN PROCESS 21582975 50667520 0 CUSTOMER DEPOSITS - ST 420359177 MARKET PARTICIPANTS LIABILITY 93536602 OBLIGATIONS UNDER CAPITAL LEASE 8917565 522813344 298296684 298296684 10383609 10383609 308680293 308680293 308680293 308680293 SCHEDULE D, PART XIII, LINE 4B GAIN ON DEFERRED REGULATORY ASSET - $10,383,609 X X X X X true true X X X X X true true false false false false false false false Richard Doying Exec VP Ops and Corp 329755 0 312796 0 70283 0 84637 0 11079 0 808550 0 44959 0 Bryan Kearney VP - INFo Svcs (thru 5/13/13) 109175 0 226097 0 220493 0 120899 0 2408 0 679072 0 0 0 Stephen Kozey SR VP - Lgl & Compliance SVCS 361326 0 341773 0 86074 0 105978 0 19719 0 914870 0 72281 0 Clair Moeller Exec VP - Transmisson & Tech 354179 0 335294 0 75863 0 107209 0 14960 0 887505 0 46660 0 William Phillips VP - RELIABILITY & SECUR. REL. 260832 0 190412 0 75112 0 69429 0 10541 0 606326 0 38241 0 Greg Powell VP - HUMAN RESOURCES 252750 0 179320 0 23182 0 66615 0 19116 0 540983 0 13066 0 Loyd A Warnock Sr VP - External Affairs 311990 0 244855 0 148335 0 78327 0 14578 0 798085 0 43896 0 Robert B Berntsen VP - Policy and Public Affairs 235250 0 117045 0 8425 0 42843 0 19107 0 422670 0 0 0 Jennifer Curran VP - Transmissions 215703 0 114228 0 11683 0 40611 0 18931 0 401156 0 0 0 Joseph Gardner VP Forward Markets and Ops 230313 0 123657 0 7377 0 47797 0 19294 0 428438 0 0 0 Todd Hillman VP - CUST & STKHLDR RELATIONS 202300 0 117632 0 27043 0 39352 0 19292 0 405619 0 0 0 Todd Ramey VP System Ops and Markets 215750 0 122477 0 22719 0 47897 0 19370 0 428213 0 0 0 Richard Schug VP Stragegy & Business Develop 200850 0 116211 0 18359 0 39527 0 18915 0 393862 0 0 0 Kurt W Bilas Exec Dir Gov't Relations 207360 0 100012 0 -918 0 18478 0 19218 0 344150 0 0 0 Lori Spence Deputy General Counsel 213750 0 99504 0 -883 0 16391 0 19256 0 348018 0 0 0 Gregory Troxell Assistant General Counsel 201909 0 95097 0 2839 0 17911 0 13897 0 331653 0 0 0 Douglas Chapman Exec Dir IT Infrastructure 215512 0 83617 0 -4712 0 18552 0 18622 0 331591 0 0 0 Christopher Hoffman Shift Manager 242618 0 26972 0 -4015 0 10913 0 18813 0 295301 0 0 0 Michael Curran DIRECTOR 135625 0 0 0 0 0 15000 0 0 0 150625 0 0 0 Shelley Longmuir DIRECTOR 135083 0 0 0 0 0 15000 0 0 0 150083 0 0 0 John Bear PRESIDENT & CEO 652000 0 877832 0 211658 0 281472 0 12810 0 2035772 0 175986 0 Josephine Biggers VP of Finance 239160 0 176373 0 34382 0 57040 0 12205 0 519160 0 13823 0 SCHEDULE J, PART I, LINE 1 THE MIDCONTINENT ISO PROVIDED CHARTER TRAVEL DURING 2013. A COST-BENEFIT ANALYSIS AS WELL AS NON-QUANTITATIVE FACTORS WERE CONSIDERED EACH INSTANCE CHARTER TRAVEL WAS USED. TRAVEL FOR COMPANIONS WAS PROVIDED FOR BUSINESS PURPOSES. TAXABLE DISCRETIONARY SPENDING ACCOUNTS WERE ALSO PROVIDED TO OFFICERS FOR HOME OFFICE ITEMS, LIFE INSURANCE, UNREIMBURSED MEDICAL EXPENSES AND OTHER ELIGIBLE EXPENSES. REIMBURSEMENT OF TAXABLE RELOCATION EXPENSES THAT ARE NOT DEDUCTIBLE OR EXCLUDABLE ARE GROSSED-UP FOR ALL OFFICERS. MANAGEMENT APPROVAL IS REQUIRED FOR ALL OTHER EMPLOYEES. A RESIDENCE (APARTMENT) IN CARMEL IS AVAILABLE FOR OFFICERS THAT DO NOT LIVE IN CARMEL IN LIEU OF HOTEL AFTER A COST-BENEFIT ANALYSIS WAS DONE AND REVEALED IT WAS MORE COST EFFECTIVE. FORM 990, SCHEDULE J, PART I, LINE 4A Brian Kearney received a severance package of $296,000. He received $185,000 in 2013 with the remainder to be paid out in 2014. The agreement included reimbursement for 100% of Brian's COBRA costs, which were approximately $10,018. In addition, Brian received a SERP payout in the amount of $85,264. NON-QUALIFIED DEFERRED COMPENSATION PLAN FORM 990, SCHEDULE J, PART I, LINE 4B PAUL J. FELDMAN $ 15,000 J. MICHAEL EVANS $ 15,000 MICHAEL J. CURRAN $ 15,000 JUDY WALSH $ 15,000 BALJIT DAIL $ 15,000 SHELLEY A. LONGMUIR $ 15,000 EUGENE ZELTMANN $ 15,000 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN SECTION 457(F) FORM 990, SCHEDULE J, PART I, LINE 4B JOHN R. BEAR $258,776 JOSEPHINE A. BIGGERS $ 34,389 JENNIFER CURRAN $ 20,423 RICHARD L. DOYING $ 61,871 JOSEPH GARDnER $ 28,517 BRYAN KEARNEY $ 23,101 STEPHEN G. KOZEY $ 83,028 CLAIRE J. MOELLER $ 85,052 WILLIAM C. PHILLIPS $ 49,469 GREGORY L. POWELL $ 45,259 The amount of Employer Contributions credited to a Participant's SERP Account for a given Plan Year shall be equal to the following amounts reduced by the sum of: (1) fixed percentage employer contributions made under the Midwest ISO Employees' Retirement Savings Plan equal to 6% of an active Participant's Compensation as defined under the Midwest ISO Employees' Retirement Savings Plan, and (2) the Employer's OASDI Contribution applicable to the Participant's Plan Year Compensation: A. 14% of Plan Year Compensation paid for those Participants under age forty-five (45); B. 16% of Plan Year Compensation paid for those Participants age forty-five (45) to age fifty-four (54); and C. 19% of Plan Year Compensation paid for those Participants age fifty-five (55) and older. 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. A Participant's age for the purpose of determining such Employer Contributions shall be determined as of the end of the Plan Year for which the contributions are made. The Employer may, at its sole discretion, make additional contributions for any one Participant or all Participants. SUPPLEMENTAL INFORMATION DESCRIPTION OF CLASSES OF MEMBERS OR STOCKHOLDERS FORM 990, PART VI, QUESTION 6 A 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 NINE SECTORS: TRANSMISSION OWNER; INDEPENDENT POWER PRODUCERS AND EXEMPT WHOLESALE GENERATORS; POWER MARKETERS AND BROKERS; MUNICIPALS, COOPERATIVES, AND TRANSMISSION DEPENDENT UTILITIES; PUBLIC CONSUMER ADVOCATES; STATE REGULATORY AUTHORITIES; ENVIRONMENTAL/OTHER ADVOCATES; ELIGIBLE END USE CUSTOMERS; OR COORDINATING MEMBERS. FORM 990, PART VI, QUESTION 7A ARTICLE TWO, SECTION V(B)(5) OF THE TRANSMISSION OWNERS AGREEMENT SETS OUT THE VOTING RIGHTS OF ALL MEMBERS OF THE MIDCONTINENT ISO. 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 HEREIN, AND WHICH PAYS TO THE MIDCONTINENT ISO, THE NON-REFUNDABLE MEMBERSHIP FEES AS REQUIRED HEREIN. FORM 990, PART VI, QUESTION 11B THE VICE PRESIDENT - FINANCE, 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, QUESTION 12C THIS POLICY IS IN THE EMPLOYEE HANDBOOK. THE HANDBOOK IS REVIEWED AT NEW HIRE ORIENTATION. ALL NEW HIRES SIGN AN EMPLOYEE HANDBOOK RECEIPT THAT THEY HAVE READ AND UNDERSTAND THE HANDBOOK. THE EMPLOYEE HANDBOOK IS ALSO PART OF THE EMPLOYEE ANNUAL RECERTIFICATION. EACH EMPLOYEE MUST CERTIFY THAT HE/SHE HAS REVIEWED AND AGREES TO COMPLY WITH MIDCONTINENT ISO POLICIES. IN ADDITION, EACH EMPLOYEE, OFFICER, AND DIRECTOR ANNUALLY RECERTIFIES THAT THEY ARE COMPLIANT WITH THE EMPLOYEE HANDBOOK AND ITS CONFLICTS OF INTEREST PROVISIONS. EACH YEAR, MISO COMPLETES THE RECERTIFICATION PROCESS WITH A SHORT TEST TO ASSURE EMPLOYEES HAVE READ AND UNDERSTAND THE CONTENT OF THE RECERTIFICATION. FORM 990, PART VI, QUESTION 15A AND 15B THE BOARD RETAINS THE SERVICE OF EXPERT OUTSIDE EXECUTIVE COMPENSATION CONSULTANTS ("THE CONSULTANTS") IN THE REVIEW OF OFFICER COMPENSATION. ANNUALLY, THE CONSULTANTS PERFORM A FULL AND INDEPENDENT STUDY OF ALL OFFICER DIRECT COMPENSATION (BASE PLUS INCENTIVES). 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 BOARD OF DIRECTORS. THE CONSULTANTS PREPARE AND DELIVER A FULL DETAILED REPORT TO THE HUMAN RESOURCES COMMITTEE OF THE BOARD ("HRC") FOR EACH OFFICER POSITION. THIS REPORT INCLUDES RECOMMENDATIONS FOR DIRECT COMPENSATION CHANGES. THE HRC COMBINES THE RECOMMENDATIONS OF THE CONSULTANTS WITH EVALUATIONS OF OFFICER PERFORMANCE TO RECOMMEND APPROPRIATE COMPENSATION LEVELS TO THE BOARD OF DIRECTORS 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 ALL METRICS, RESULTS, AND ACTUAL INCENTIVES FROM MIDCONTINENT ISO ANNUAL AND LONG-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 EXPERTS 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, QUESTION 19 THE MIDCONTINENT ISO'S GOVERNING DOCUMENTS CAN BE FOUND ON OUR WEBSITE UNDER "LIBRARY" 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 ELIBRARY. THE FINANCIAL STATEMENTS OF THE MIDCONTINENT ISO ARE CONTAINED IN THE COMPANY'S ANNUAL REPORT WHICH IS ALSO LOCATED ON OUR WEBSITE AT WWW.MISOENERGY.ORG.