Consolidated Telcom 2024 Annual Meeting Book

Official Notice of Annual Meeting

The annual meeting of Members of Consolidated Telcom will be held at Trinity High School Auditorium (Empire Road & 8th Ave. W.) in Dickinson, ND at 6:00 p.m. on the 19th day of June, 2024 to take action upon the following matters:

1. Report on the number of persons present in order to determine the existence of quorum.

2. Reading of the Notice of the Meeting.

3. Reading of minutes of previous meetings of members and taking of necessary action.

4. Presentation and consideration of report of officers, directors, and committees.

5. Election of Directors - the following members have been nominated for Director by the Nominating Committee pursuant to the By-Laws:

District 1 (Dodge, Dunn Center, Halliday, Manning) - Janet Wanek

District 6 (Hettinger, Regent) - Paula Anderson

District 7 (Mott, Richardton) - Duane Zent

Registration will begin at 4:30 p.m. in the Commons Area at Trinity High School.

Dated this 20th day of May A.D. 2024 — Janet Wanek, Secretary

Agenda

4:30 - 5:45 p.m.

5:15 - 5:45 p.m.

6:00 p.m.

Dinner in the cafeteria

Entertainment - Bingo with prizes

Call to Order:

Welcome

Determination of Quorum

Reading of Notice of Meeting

Reading of Minutes of Previous Member Meeting Officer, Financial & Committee Report

Naming of the Election Board

Election of three (3) Directors:

Many Door Prizes will be given away!

Adjournment FREE

District 1 (Dodge, Dunn Center, Halliday, Manning) - Janet Wanek

District 6 (Hettinger, Regent) - Paula Anderson

District 7 (Mott, Richardton) - Duane Zent

Unfinished Business:

- Announce & Introduce Newly Elected Directors

1. Call to Order: The President, or in the absence of the President, the Vice President, shall act as chairman of the annual meeting or of any special meeting of members.

2. Points of Order: The chairman shall preserve order and, consulting with legal counsel, decide all questions of procedure and order. Questions of procedure and order not governed by statute, the Cooperative’s Articles of Incorporation nor by its Bylaws shall be decided by the chairman, subject to a motion appealing the chairman’s decision.

3. Who Recognized: When two or more members rise to speak, the chairman shall designate the order of speaking.

4. Identification: Every member recognized to speak, shall first identify himself or herself.

5. Rules As To Speaking: No member shall speak more than twice on the same subject without consent of the majority of the members present, nor more than once until every member choosing to speak on the subject pending shall have spoken. No member shall occupy the floor more than five minutes the first time, and three minutes the second time, without the consent of a majority of the members present.

6. Non-Members Right to Speak: When all members wishing to speak on the pending subject shall have spoken, or at any time by consent of a majority of the members present, any non-members may be allowed to speak subject to the same rules governing the members.

7. Program Schedule: The order of business set forth in the Cooperative’s Bylaws and reprinted in the meeting notice shall be the official meeting agenda. Appropriate motions addressing subjects not specifically covered by the agenda shall be made only under the categories

Board of Directors

of “unfinished business” or “new business” as may be appropriate.

8. Motion To Be Stated And Seconded Before Consideration: No motion shall be received for consideration unless the same shall be stated by a member and seconded by another member.

9. Motion Under Consideration: After a motion has been stated and seconded no other motion shall be received except a motion to adjourn, lay on the table, withdraw, or amend, until after a vote on the motion is taken or the motion is withdrawn.

10. Motion May Be Withdrawn: If a motion has been stated and seconded, it may be withdrawn at any time before amendment by the member who made the motion, and with the consent of a majority of the members present.

11. Motion To Adjourn: A motion to adjourn shall be in order, except when a delegate is addressing the chair, or vote is being taken.

12. How A Motion Is Passed: Except as otherwise stated in these rules and except as governed by statute, the Cooperative’s Articles of Incorporation or by its Bylaws, all motions contemplated by these rules shall require a majority vote of the members present.

13. Motion To Suspend The Rules: These rules shall be subject to a motion to suspend the rules, if such motion does not affect rules established by statute, the Cooperative’s Articles of Incorporation or by its Bylaws. A motion to suspend these rules must be adopted by a vote of 2/3rds of the members present.

14. Scope Of These Rules: These rules are intended to govern member meeting procedure. There shall be no other meeting rules except these rules.

Duane Zent

Bill Schaller

Brenda Volesky

Paula Anderson

Jan Stebbins

Janet Wanek

Scott Bachmeier

Board President and Manager’s Report

Welcome to the 63rd Annual Meeting of Consolidated.

2023 was a busy year for your cooperative as we continued our work to enhance and improve the services we provide to you. Early in the year we completed our network ring upgrade to 200G from the existing 10G capacity. The ring is the mainline fiber transport that connects all of the communities we serve. It is the backbone upon which all of our services ride back to our offices in Dickinson and then out to the world. The need for this upgrade was driven by increased Internet usage by our members and it ensures that Consolidated has the bandwidth available to meet your needs in the future.

We also enhanced our cable television (CATV) service product by making it available as a streaming service. It is now possible for our members to have CATV service without the need for traditional set top boxes which helps to reduce our operating costs. While this may not appeal to all, many members already have streaming devices and now they can simply add our “App” to enjoy our CATV service through that device without the need for a set top box.

2023 was also our kick off year for expanding fiber to the home in rural Belfield. Work began south of the interstate in August and we were able to place 105 miles of fiber and 72 drops before freeze up. Construction will resume in the South half of the Belfield exchange in early Spring this year and will begin in the North half simultaneously with multiple crews running to keep the project moving forward.

As explained last year, there are many people in this exchange that do not have access to broadband Internet or even reliable telephone service. This project offers Consolidated an opportunity to expand its customer base and bring much needed services to an area adjacent to our existing service area. Having a larger customer base helps us keep rates affordable for all by sharing operational costs. This project is win-win. It’s good for Consolidated’s existing members and good for our family, friends and neighbors in the Belfield exchange that don’t have access to these services today.

Consolidated continues to be in sound financial condition with 2023 combined operating revenues of $47,714,338 and combined expenses of $42,400,472 for a net margin of $4,946,711 for the year. Capital credit disbursements are evaluated annually by the Board of Directors. In addition to regular capital credit disbursements for 75 year olds and estates, there will be a modest general retirement and retirement of refunded federal excise taxes.

Family, friends and neighbors serving family, friends and neighbors. This is why we were formed 63 years ago and it is why we still exist today. We are grateful for the dedication and service of all the employees of Consolidated. We would also like to thank you as members for your continued loyalty and support. Your cooperative will continue to strive to provide you the most innovative services that are available in today’s digital world. Consolidated’s future looks bright and we look forward to serving you.

Bryan Personne General Manager/CEO

Bill Schaller President

Director Candidates

Janet Wanek

District 1

Dodge, Dunn Center, Halliday and Manning Exchanges

Paula Anderson

District 6

Hettinger and Regent Exchanges

Duane Zent

District 7

Mott and Richardton Exchanges

Janet Wanek, lives in Halliday, ND, has worked as a registered dietitian for the past 16 years in various career fields, including Dunn County NDSU Extension but currently works for the Southwestern District Health Unit. Growing up in Southwest North Dakota, Janet knows the importance of giving back to the community you live in, so she also serves as an EMT with the Halliday Rural Fire and Ambulance and has served on various boards including as a City Commissioner in Halliday for 8 years.

Janet and her husband, Jarret, who is a diesel mechanic for North American Coal Freedom Mine in Beulah, bought one of the oldest homes in Halliday in 2013 and continue to remodel and make it their own as they balance life with their two kids. Janet tries to make time to enjoy hunting, spending time with her family, or golfing from time to time.

Paula Anderson has served on the board of Consolidated since 2009. She has been both board secretary/treasurer and vice president. Paula grew up in Mott, married a farmer from Regent and raised 4 children. Larry and Paula’s oldest son, Denver and wife, MaryBeth farm together with them south of Regent. Paula has worked and held several volunteer positions in the Mott/Regent area. Having attended Dickinson State College and taken accounting classes, she has enjoyed bookkeeping and is passionate about rural development. She completed the Director Core Curriculum with NTCA (National Telecommunications Cooperative Association). She is a graduate of RLND (Rural Leadership North Dakota) program. Paula currently serves on the Hettinger County Historical Society, the R E & T (Rural Electric and Telco) Committee, the RDFC (Rural Development Finance Corporation) board and the Dakotas America board.

As a board member, she has used her experience and passion in seeing Rural Development happen in Southwestern North Dakota. Paula enjoys seeing Consolidated continue to thrive, offering fiber optics for their customers, both private and business. Our commitment to a state-of-the-art network will provide excellent customer experience and service for years to come.

I grew up on a farm south of Richardton, North Dakota where my parents, Joseph & Katherine Zent, raised me and my five siblings. I attended Richardton High School and graduated in 1976. After graduating high school, I chose to pursue a degree in Diesel Mechanics from Wahpeton State School of Science and graduated in 1978. In 1979, I married Karen Welsch. We made the decision to reside on my family’s farm to help my mom continue farming and run the dairy operation, as my dad passed away in the fall of 1975. My brother, Richard, and his family also moved back to the farm, and we continue to run a similar operation today.

Karen and I have four children and eight grandchildren. Our youngest son, Garrett, and Richard’s son, Justin, farm with Richard and me. Our farm and ranch operation consists of growing corn, wheat, sunflowers, and canola. We also run a cow/calf operation.

I am currently a member of St. Stephens Knights of Columbus and the Richardton Lions Club. I serve as Vice President of the Richardton/Taylor School Board and have served on this board for 20 plus years. I am also a member of the St. Stephens Church Board and Richardton Community Development Board. My involvement in the community is something I take great pride in. Having the opportunity to help make a positive impact in our community, school, and church is very important to me.

My faith and family have always and will always be the most important part of my life. Time spent with Karen, our children, and grandchildren is something I cherish beyond words. My hobbies consist of fishing, hunting, and snowmobiling, which are activities I now enjoy sharing with my family.

I have greatly appreciated the opportunity to serve on the Consolidated Board for the last six years and am looking forward to serving another term.

The 2023 Prestigious Eagle Award Winner

CEO/General Manager, Bryan Personne, presented the Eagle Award to Carl Ebert at the Employee Appreciation Social on December 8, 2023. “Picking one employee each year for the Eagle Award is always challenging as we have so many exceptional employees that work for Consolidated,” Personne says.

Carl has been employed with Consolidated since 2007 and is a Combination Tech in our Hettinger exchange. He serves on the Hettinger City Council and is the friendly, trusted face of Consolidated in Hettinger, Reeder, and beyond. Carl is always willing to help, has a smile on his face, and pride in his work! He is at the office early each morning to design his day around customer needs.

On behalf of the Consolidated management team and board of directors, thank you Carl for a job well done!

Carl Ebert

The Members, Consolidated Telcom and Subsidiary - Dickinson, North Dakota

Eide Bailly, LLP audited, in accordance with generally accepted auditing standards, the consolidated balance sheets of Consolidated Telcom and Subsidiary as of December 31, 2022 and 2023, and the related consolidated statements of patronage capital and cash flows (not presented herein) for the years then ended. Eide Bailly, LLP issued their opinion on our consolidated financial statements that based on their audit, the financial statements present fairly, in all material respects, the financial position of Consolidated Telcom and Subsidiary as of December 31, 2022 and 2023, and the results of its operations and cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America. The information set forth in the accompanying condensed consolidated financial statements was derived from the audited financial statements. Complete audited financial statements and their opinion are on file at the Cooperatives office.

Sarah Haich

Chief Financial Officer – Consolidated Telcom

Balance Sheet

Current Assets

Cash and cash equivalents

Investments in held-to-maturity debt securities

Investments in securities

Telecommunications accounts receivable, net of allowance

Other accounts receivable, net of allowance

Interest receivable

Note receivable

Materials and supplies

Prepayments

Total current assets

Investments and Noncurrent Assets

Investments in held-to-maturity debt securities

Other investments

Note receivable

Note receivable - related party

Deferred income taxes

Intangible assets, net of accumulated amortization

Total investments and noncurrent assets

Telecommunications and Other Plant

Telecommunications plant

Other plant

Under construction

Total investment in plant

Less accumulated depreciation and amortization

Net telecommunications and other plant 2023 $13,585,752 2,767,986 6,136,533 443,380 1,707,700 48,731 111,000 1,674,307 1,119,006 27,594,395 120,639 7,623,103 509,370 445,099 18,923 25,338 8,742,472 209,655,853 23,813,396 7,295,824 240,765,073 139,693,841 101,071,232 $137,408,099 2022 $15,750,642 2,652,339 5,600,615 473,915 1,744,683 21,774 111,000 1,703,071 1,344,381 29,402,420 878,674 7,269,809 620,482 465,499 41,322 31,805 9,307,591 202,626,624 23,708,050 4,196,354 230,531,028 128,500,742 102,030,286 $140,740,297

Liabilities & Equities

Current Liabilities

Current maturities of long-term debt

Accounts payable

Advance billings and customer deposits

Accrued taxes - other

Accrued employee benefits

Other current liabilities

Total current liabilities

Long-Term Debt, Less Current Maturities

Other Liabilities

Deferred income taxes

Accrued employee benefits

Deferred revenue - ARRA

Other non-current liabilities

Total other liabilities

Equities Patronage

11,503,179 44,871,860 5,250,502 2,079,858 2,000,983 22,211 9,353,554 58,040,663 16,971,041 75,011,704 $140,740,297

Patronage Capital & Other Equities

Consolidated Statement of Operations

Operating Revenues

Local network access

Network access services

Long distance network services

Cable television services

Internet services

Retail equipment sales

Leased equipment revenue

Miscellaneous

Uncollectibles

Total operating revenues

Operating Expenses

Plant specific operations

Plant nonspecific operations

Maintenance

Depreciation and amortization

Customer operations

Corporate operations

Cable television programming

Cost of equipment sales

Operating taxes, other

Total operating expenses

Net Operating Margin

Nonoperating Margin (Loss)

Investment income (loss) Loss on sale of equipment

Equity earnings in affiliated company

Other nonregulated income, net of expenses

Net nonoperating margin (loss)

Net Margin Before Interest Expense & Income Taxes

Interest Expense

Net Margin Before Income Taxes

Provision for Income Taxes

Net Margin

2023 $3,055,021 19,229,093 634,085 7,185,767 10,405,588 2,572,187 590,410 4,095,691 (53,504) 47,714,338 6,881,826 4,210,027 1,191,652 12,965,525 5,516,063 4,482,849 6,365,715 636,713 150,102 42,400,472 5,313,866 1,094,036574,218 (177,698) 1,490,556 6,804,422 1,411,942 5,392,480 445,769 $4,946,711 2022 $3,445,671 20,409,075 689,111 7,332,560 9,970,090 2,485,041 686,478 3,928,913 (42,256) 48,904,683 6,360,707 4,430,664 1,348,638 12,405,635 5,123,882 4,192,080 6,387,625 836,963 155,926 41,242,120 7,662,563 (511,127) (6,220) 622,483 (143,721) (38,585) 7,623,978 1,631,770 5,992,208 342,836 $5,649,372

Operating Revenues $47,714,338 Operating Expenses $42,400,472 Network Access

Depreciation and Amortization

12,965,525 30.58%

Cost of CATV Programming

6,365,715 15.01%

Plant Specific

6,881,826 16.23%

Customer Operations

5,516,063 13.01%

Plant Non-Specific 4,210,027 9.93% Corporate Operations 4,482,849 10.57% Maintenance 1,191,652 2.81% Cost of Retail Equipment Sales 636,713 1.50%

0.35%

15.06% Miscellaneous 4,042,187 8.47%

6.40%

5.39%

1.33%

1.24%

& Amortization

Minutes of Annual Meeting of Members

CONSOLIDATED TELCOM

MINUTES OF ANNUAL MEETING OF MEMBERS

JUNE 21, 2023

Call to Order: The Annual Meeting of Members of Consolidated Telcom was held at was held at Trinity High School, at Dickinson, North Dakota, on June 21, 2023, commencing at 6:00 p.m., pursuant to call and notice.

The Annual meeting was called to order by the President, Bill Schaller, who presided. The Secretary of the Cooperative, Paula Anderson, acted as Secretary and kept the minutes of the meeting. Also attending was the Attorney for the Cooperative, Haylee Culver, who took notes for the purpose of assisting the Secretary in preparing the minutes.

Introduction: President Schaller first introduced all of the Directors. He next introduced the General Manager of Consolidated Telcom, Bryan Personne, and Attorney Haylee Culver.

Quorum: The President next called upon the Secretary concerning registration and the presence of a quorum, to which the Secretary reported that a quorum was present to do business, there being 113 members registered at the commencement of the meeting.

Notice: The President next called for the reading of the Notice of Annual Meeting of members. The Secretary read the Notice of Meeting.

Minutes: The President then called for the reading of the Minutes of the Annual Meeting of Members held on June 22, 2022, which had been printed along with the Notice. Thereafter, a motion was duly made and seconded to dispense with the reading of the Minutes of the Annual Meeting of Members and to approve the Minutes. The motion carried, and the Minutes of the 2022 Annual Meeting of Members were approved.

Approval of Reports: The President announced that the next order of business would be the reports,

and referred the members to the written report contained in the Meeting Booklet and allowed time for questions or comments on the report. There being no questions, on motion duly made, seconded, and unanimously carried, the President’s and General Manager’s Joint Report was accepted.

Financial Reports: Sarah Haich, Director of Finance and Accounting, presented the Financial Reports. Total assets were down from $141,610,965 to $140,740,297 and equities were up from $70,622,713 to $75,011,704. The 2022 net margin was $5,649,372. She asked for any questions, and there were none. A motion was duly made, seconded, and carried to accept the Financial Reports.

Elections: The President announced that the next order of business would be the election of Directors in accordance with the Notice of Meeting. Nominating Committee Chairperson Wayne Mrnak reported the results of the Nominating Committee meeting to the members. The Committee nominations were Brenda Volesky, District 3, and Scott Bachmeier, District 4.

President Schaller reported that the Nominating Committee nominated Brenda Volesky to fill the vacancy occurring on the Board of Directors from District No. 3. There were no nominations submitted by petition. Upon motion duly made, seconded and unanimously carried, it was resolved that nominations for Director for District No. 3 be declared closed, and that the Secretary be directed to cast a unanimous ballot for Brenda Volesky.

President Schaller reported that the Nominating Committee nominated Scott Bachmeier to fill the vacancy occurring on the Board of Directors from District No. 4. There were no nominations submitted by petition. Upon motion duly made, seconded and unanimously carried, it was resolved that nominations for Director for District No. 4 be declared closed, and that the Secretary be directed to cast a unanimous ballot for Scott Bachmeier.

Introduction of Guests: General Manager Bryan Personne introduced guests in attendance: Dustin

Maier, ReadiTech Engineering and Carissa Swenson, BAND director.

General Manager’s Remarks: General Manager Bryan Personne welcomed special guests. Mr. Personne thanked the staff of Consolidated for their continued hard work and dedication to the Cooperative. He also recognized the Eagle Award Winner for 2022, Amanda Kessler.

Mr. Personne stated that the financial position of the company is strong. There is good cash flow, and Consolidated is able to take on projects without debt. Mr. Personne commented on the national usage trends and noted that Consolidated is in line with those trends. NetVoice has helped mitigate usage issues, and provides a lower cost, quality service to customers. Last year there were 2700 users of NetVoice, and as of the meeting date there were 2937 users. Mr. Personne stated that there are no plans to move away from offering services like telephone and cable. There is an increase in the number of customers taking Broadband services.

Mr. Personne reported that approximately 18 months ago Consolidated started a project to upgrade the

network ring from 20 gig capacity to 200 gig. This will have a significant impact on the network ability to handle traffic. The upgrade is almost complete, with Amidon and Rhame being the last communities to update.

Mr. Personne reported on the Belfield project which will serve the entire exchange of Belfield. Consolidated received a grant which covers roughly 75% of the project costs.

Mr. Personne recognized the local scholarship winners: Emily Ash, Taj Blauer, Reese Campbell, Tanner DeFoe, Gracie Doe, Max Lefor, McKaylee Kalstrom, Tacy Palahniuk, Cole Manolovits, and Luke Heiser.

The President called for any unfinished, new, or other business to come before the meeting. There being no further unfinished, new, or other business, upon motion duly made, seconded, and carried, the meeting was adjourned at 6:39 p.m.

Paula Anderson, Secretary Attest:

Bill Schaller, President

2024 Consolidated Scholarship Winners

2024 Dual Credit Scholarship Winners

Consolidated is proud to award a $1000.00 scholarship to ten graduating seniors whose parents or guardians are Consolidated customers. Applicants were judged primarily on the written essay topic, “How has technology contributed to your community?”

Consolidated also added a new dual credit scholarship this year for students taking college credit courses online or in person where there is cost to them. We were honored to award four - $250 scholarships to students in our service area. We are proud to offer these programs and show our commitment to the youth in our service area.

Congratulations to this year’s Consolidated scholarship winners, and the entire class of 2024!

Sadie Stevenson Dickinson HS

Nathan Dix Bowman Cnty HS

Molly Robb South Heart HS Isabel Kirsch Dickinson HS Kaeden Krieg Dickinson HS

Katherine Schneider

Reagen Coyle Bowman Cnty HS

OLivia DeFoe Hettinger HS

Adyson Karsky Trinity HS

Harper Skaare Trinity HS

Harper

Skaare Trinity HS

Wednesday, July 31st

– Richardton HS Football Field

6:00 pm ... Concessions

Dusk ... Movie begins, Minions The Rise of Gru

Wednesday, August 7th

– Halliday City Park

6:00 pm ... Concessions

Dusk ... Movie begins, Super Mario Bros Movie

Wednesday, August 14th

– Gladstone North Park

6:00 pm ... Concessions

Dusk ... Movie begins, Paw Patrol: The Mighty Movie