1. BORDER STATES ELECTRIC Supply Chain Solutions Midwest ESOP Conference Milwaukee, WI September 12, 2013

2. Darin Sherva Payroll and Benefits Supervisor Sherri Sandvig VP Human Resources

3. ESOP Governance ESOP committee ESOP advisors/partners ESOP Auditor – Grant Thornton Trustee – Alerus Financial Stock valuation – Chartwell Capital Solutions Record keeper – Principal Financial Legal counsel – Gray Plant Mooty Communication committee

4. ESOP Administration ESOP project plan Timeline for all administration activities –Keeps us on track – meeting deadlines Milestones ‒ Census ‒ Stock valuation ‒ Certificate distribution/celebration ‒ Distribution/diversifications

5. It’s not just communicating, it’s working to bring the benefits of the ESOP alive.

6. Communication/Education What we must communicate: Summary plan description (SPD) Summary of Material Modifications (SMM) Annual ESOP statements Summary Annual Report (SAR) Distribution info to eligible participants

7. Communication/Education What we want to communicate: Open book management Strategic plan Ownership responsibilities for all employees How company profitability affects ESOP How our ESOP works −Eligibility −Vesting −Contributions −Eligible compensation −Valuation process −Distributions and diversifications

8. Communication/Education How we plan to communicate: Created “Communication Project Plan” −Monthly −Quarterly −Yearly

9. Communication/Education Our communications: Weekly newsletter Monthly supervisor newsletter Monthly meetings Monthly video

10. Communication/Education How we communicate: (cont.) SharePoint newsfeeds Ownership celebrations/meetings Supervisor and manager training ESOP brochure for applicants Onboarding process

11. Communication/Education Ideas to communicate/educate/celebrate: ESOPtoberfest Annual ESOP statement celebration “Guess the Stock Price” contest

12. Communication/Education Ideas to communicate/educate/celebrate: Articles from upcoming retirees ESOP calculator

13. Communication/Education Ideas to communicate/educate/celebrate Desk drops Articles from employees 20% vested recognition 100% vested celebration

14. Communication/Education Ideas: (cont.) Giving back −food drives −sponsor walks and runs −blood drives −buy gifts and bell ringing during the holidays −volunteer time at nonprofits −filling sandbags −donating baby supplies for annual baby shower −donating backpacks and school supplies −serve on boards and committees of nonprofits

15. Legislative meetings Employee engagement survey Succession planning Mentoring Referral bonus

16. Challenges What challenges do you have?

17. Team Consult What unique ideas have you used to communicate or educate your employees about the ESOP?

18. Wrap up Employee-owners Owners meetings Tie profits/expenses to ESOP contributions Competitive pay and benefits Profit sharing bonuses

19. Questions