Document:

NEW ULM TELECOM, INC. EXHIBIT 10.4 TO FORM 8-K DATED DECEMBER 31, 2007

Exhibit 10.4  

Loan No. RX0583-T1

PROMISSORY NOTE

NEW ULM TELECOM, INC.

	
 

	
 

	
$15,000,000

	
Dated: January 4, 2008

          FOR VALUE RECEIVED, the undersigned
unconditionally promises to pay to COBANK, ACB (the “Payee”), or its order, at the times and
in the manner set forth in that certain Master Loan Agreement, dated as of the
date hereof, among the undersigned and Payee, as it may be amended, modified,
supplemented, extended or restated from time to time, (the “MLA”), and in that certain First
Supplement to the Master Loan Agreement, dated as of the date hereof, among the
undersigned and Payee, as it may be amended, modified, supplemented, extended
or restated from time to time (the “First
Supplement”; and together with the MLA, collectively, the “Loan Agreement”), ­the principal
sum of
FIFTEEN MILLION UNITED STATES DOLLARS ($15,000,000) or such lesser amount as
may be advanced hereunder, together with interest on the unpaid principal
balance hereof at the rate or rates set forth in the Loan Agreement.

          This
note is given for the loan to be made by the Payee to the undersigned pursuant
to the Loan Agreement, all of the terms and provisions of which (including,
without limitation, provisions regarding acceleration of the maturity hereof
and application of default interest and of a surcharge to payments hereunder)
are hereby incorporated by reference. Accrued interest and payments shall be
posted by the Payee upon an appropriate accounting record, which record (and
all computer printouts thereof) shall constitute prima facie evidence of the
out­standing principal and interest on the loan. Any amount of principal hereof
which is not paid when due, whether at stated maturity, by acceleration or
otherwise, shall bear interest from the date when due until said principal amount
is paid in full, payable on demand, at a rate per annum set forth in Section
11(D) of the MLA.

          The
makers or endorsers hereof hereby waive presentment for payment, demand,
protest, and notice of dis­hon­or and nonpayment of this note, and all defenses
on the ground of delay or of any exten­sion of time for the payment hereof
which may be hereafter given by the holder or holders hereof to them or either
of them or to anyone who has assumed the payment of this note, and it is speci­fi­cally
agreed that the obligations of said makers or endorsers shall not be in anywise
affected or altered to the prejudice of the holder or holders hereof by reason
of the assumption of payment of the same by any other person or entity.

          Should
this note be placed in the hands of an attorney for collection or the services
of any attor­ney become necessary in connection with enforcing its provisions,
the undersigned agrees to pay reasonable attorneys’ fees, together with all
costs and expenses incident thereto, to the extent allowed by law. Except to
the extent governed by applicable federal law, this note shall be governed by
and construed in accordance with the laws of the State of Colorado, with­out
reference to choice of law doctrine. Whenever possible, each provision of this
note shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this note shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this note. Whenever in this note
reference is made to the Payee or the undersigned, such reference shall be
deemed to include, as applicable, a reference to their respective successors
and assigns. The provisions of this note shall be binding upon and shall inure
to the benefit of such successors and assigns. The undersigned’s successors and
assigns shall include, without limitation, a receiver, trustee or debtor in
possession of or for the undersigned.

Promissory
Note/New Ulm Telecom, Inc.

Loan No. RX0583-T1

          IN WITNESS WHEREOF, the undersigned has
caused this note to be executed and attested under seal and delivered by its
duly authorized officer as of the date first shown above.

	
 

	
 

	
 

	
 

	
NEW ULM TELECOM, INC.

	
 

	
 

	
 

	
By: 

	
 

	
 

	
 

	 

	
 

	
 

	
Name:

	
 

	
 

	
Title:NEW ULM TELECOM, INC. EXHIBIT 10.5 TO FORM 8-K DATED DECEMBER 31, 2007

Exhibit 10.5  

CLOSING TABLE COPY 

Loan No. ML RX0583-T2 

SECOND SUPPLEMENT

TO THE MASTER LOAN AGREEMENT

          This
SECOND SUPPLEMENT TO THE MASTER LOAN
AGREEMENT  (as the same may be amended, modified, supplemented,
extended or restated from time to time, this “Second Supplement”), is entered into as of January 4,
2008, between COBANK, ACB (“CoBank”)
and NEW ULM TELECOM, INC. (the “Borrower”), and supplements that
certain Master Loan Agreement, dated as of even date herewith, between CoBank
and the Borrower (as the same may be amended, modified, supplemented, extended
or restated from time to time, the “MLA”).
Capitalized terms used and not otherwise defined in this Second Supplement
shall have the meanings assigned to them in the MLA.  

          SECTION 1. Revolving Loan Commitment. On
the terms and conditions set forth in the MLA and this Second Supplement,
CoBank agrees to make one or more advances (collectively, the “Loan”) to the Borrower during the
Availability Period (as hereinafter defined in Section 3 of this Second
Supplement) in an aggregate principal amount outstanding at any one time not to
exceed $10,000,000 (the “Commitment”).
The Commitment shall be reduced from time to time as provided in Section 6
and Section 7 hereof and shall expire at 12:00 noon Central time on the
Business Day immediately preceding December 31, 2014, or such later date as
CoBank in its sole discretion shall provide in writing (the “Maturity Date”). Under the Commitment,
amounts borrowed and later repaid may be reborrowed. 

          SECTION 2. Purpose. The proceeds of the
Loan shall be used by the Borrower (i) to make an equity investment in
Hutchinson Acquisition Corporation (“Hutchinson”)
to be used for the acquisition of Hutchinson Telephone Company (the “Acquisition”), (ii) for capital
expenditures and general corporate purposes of the Borrower and its
wholly-owned Subsidiaries, and (iii) to pay fees and expenses associated with
the Loan. The Borrower agrees that the proceeds of the Loan shall be used only
for the purposes set forth in this Section 2. 

          SECTION 3. Availability. Subject to
Sections 2 and 6 of the MLA and Section 9 of this Second Supplement, during the
period commencing on the date on which all conditions precedent to the initial
advance under the Loan are satisfied (the “Closing
Date”) and ending on the Business Day immediately preceding the
Maturity Date (the “Availability Period”),
advances under the Loan will be made as provided in the MLA; provided, however,
that the Closing Date shall occur no later than January 4, 2008.  

          SECTION 4. Interest.

          (A) Rate Options; Etc. The unpaid principal
balance of the Loan shall accrue, and the Borrower agrees to pay interest at
the rate or rates determined or selected by the Borrower in accordance with
this Subsection 4(A).

Second
Supplement to the Master Loan Agreement/New Ulm Telecom, Inc.

Loan No.
RX0583-T2 

	
 

	
 

	
 

	
          (1) 7-Day LIBOR Index Rate (Variable Rate Option).
 As to any portion of the unpaid principal balance of the Loan selected by the
 Borrower (any such portion, and any portion selected pursuant to Subsection
 4(A)(2) or 4(A)(3) of this Second Supplement, is hereinafter
 referred to as a “Portion”
 of the Loan), interest shall accrue pursuant to this variable rate option at
 a rate (rounded upward to the nearest 1/100th and adjusted for
 reserves required on Eurocurrency Liabilities (as hereinafter defined in this
 Subsection 4(A)(1)) for banks subject to FRB Regulation D (as
 hereinafter defined in this Subsection 4(A)(1)) or required by any
 other federal law or regulation) per annum (the “Variable Rate”) equal at all times to
 the annual rate quoted by the British Bankers Association (the “BBA”) at 11:00 a.m. London time for
 the offering of seven-day U.S. dollar deposits, as published by Bloomberg or
 another major information vendor listed on BBA’s official website on the
 first U.S. Banking Day (as hereinafter defined in this Subsection 4(A)(1))
 in each week with such rate to change weekly on such day plus a margin
 (the “LIBOR Margin”)
 equal to the percentage determined from time to time in accordance with Subsection
 4(B) of this Second Supplement. The rate shall be reset automatically,
 without the necessity of notice being provided to the Borrower or any other
 party, on the first U.S. Banking Day of each succeeding week, and each change
 in the rate shall be applicable to all balances subject to this option.
 Information about the then-current rate shall be made available upon
 telephonic request. “U.S. Banking Day”
 means a day on which CoBank is open for business and banks are open for
 business in New York, New York. “Eurocurrency
 Liabilities” has the meaning as set forth in FRB Regulation D.
 “FRB Regulation D” means
 Regulation D as promulgated by the Board of Governors of the Federal Reserve
 System, 12 CFR Part 204, as amended from time to time. 

	
 

	
 

	
 

	
          (2) LIBOR Option. As to any Portion or
 Portions of the Loan selected by the Borrower, interest will accrue pursuant
 to this LIBOR option at a fixed rate per annum equal to LIBOR (as hereinafter
 defined in this Subsection 4(A)(2)) plus the LIBOR Margin.
 Under this option: (i) rates may be fixed for Interest Periods (as
 hereinafter defined in this Subsection 4(A)(2)) of one, two, three,
 six, nine or 12 months, as selected by the Borrower; (ii) amounts fixed shall
 be in increments of $100,000 or multiples thereof; and (iii) rates may only
 be fixed on a Banking Day (as hereinafter defined in this Subsection
 4(A)(2)) on three Banking Days’ prior written notice. “LIBOR” means the rate (rounded upward
 to the nearest sixteenth and adjusted for reserves required on Eurocurrency
 Liabilities for banks subject to FRB Regulation D or required by any other
 federal law or regulation) quoted by BBA at 11:00 a.m. London time two
 Banking Days before the commencement of the Interest Period for the offering
 of U.S. dollar deposits in the London interbank market for the Interest
 Period designated by Borrower, as published by Bloomberg or another major
 information vendor listed on BBA’s official website. 

2

Second
Supplement to the Master Loan Agreement/New Ulm Telecom, Inc. 
Loan No.
RX0583-T2 

	
 

	
 

	
 

	
“Banking Day” shall mean a day on
 which CoBank is open for business, dealings in U.S. dollar deposits are being
 carried out in the London interbank market, and banks are open for business
 in New York City and London, England. “Interest
 Period” shall mean the time period chosen by the Borrower
 during which the chosen fixed rate is to apply to a Portion of the Loan,
 which period commences on the day a rate fixed under Subsection 4(A)(2)
 or 4(A)(3) of this Second Supplement becomes effective. The Interest
 Period for Portions accruing interest at the LIBOR option shall end on the
 day in the next calendar month or in the month that is two, three, six, nine
 or 12 months thereafter which corresponds numerically with the day the
 Interest Period commences; provided, however, that: (a) in the
 event such ending day is not a Banking Day, such period shall be extended to
 the next Banking Day unless such next Banking Day falls in the next calendar
 month, in which case it shall end on the preceding Banking Day; and (b) if
 there is no numerically corresponding day in the month, then such period
 shall end on the last Banking Day in the relevant month. No Interest Period
 shall extend beyond the Maturity Date (as defined in Section 6 of this
 Second Supplement). 

	
 

	
 

	
 

	
          Upon
 the occurrence and during the continuance of any Event of Default, as the
 Interest Periods for Portions of the Loan accruing interest at a LIBOR option
 expire, at CoBank’s option, such Portions of the Loan shall be converted to
 the Variable Rate option, and the LIBOR option will not be available to the
 Borrower until any such Events of Default have been waived. 

	
 

	
 

	
 

	
          (3) Quoted Fixed Rate Option. As to any Portion
 or Portions of the Loan selected by the Borrower, interest shall accrue
 pursuant to this quoted rate option at a fixed annual interest rate (the “Quoted Rate”) to be quoted by
CoBank
 in its sole and absolute discretion in each instance. Under this option, the
 interest rate on such Portion or Portions of the Loan may be fixed for such
 Interest Periods as may be agreeable to CoBank in its sole and absolute
 discretion in each instance; provided, however, that (i) such
 Interest Period shall not extend beyond the Maturity Date and such Interest
 Period may only expire on a Business Day, (ii) the minimum fixed period shall
 be one year, and (iii) amounts fixed shall be in increments of $100,000 or
 multiples thereof. 

	
 

	
 

	
 

	
          Upon
 the occurrence and during the continuance of any Event of Default, as the
 Interest Periods for Portions of the Loan accruing interest at the Quoted
 Rate option expire, such Portions of the Loan shall be converted to the
 Variable Rate option, and the Quoted Rate option will not be available to the
 Borrower until any such Events of Default have been waived. 

	
 

	
 

	
 

	
          (4) Rate Combinations. Notwithstanding
 the foregoing, at any one time there may be no more than an aggregate of five
 Portions of the Loan and any loan under 

3

Second
Supplement to the Master Loan Agreement/New Ulm Telecom, Inc.
 Loan No.
RX0583-T2 

	
 

	
 

	
 

	
any other
 Supplement to the MLA accruing interest pursuant to the LIBOR option and no
 more than an aggregate of five Portions of the Loan and any loan under any
 other Supplement to the MLA accruing interest pursuant to the Quoted Rate
 option. 

	
 

	
 

	
 

	
          (5) Selection and Changes of Rates. The
 Borrower shall select the rate option or options applicable to the Loan at
 the time it requests the Loan. Thereafter, with respect to Portions of the
 Loan accruing interest at the Variable Rate, the Borrower may, on any
 Business Day, subject to Subsections 4(A)(2), 4(A)(3) and 4(A)(4)
 of this Second Supplement, elect to have one of the fixed rate options apply
 to such Portion. In addition, with respect to any Portion of the Loan
 accruing interest pursuant to a fixed rate option, the Borrower may, subject
 to Subsections 4(A)(2), 4(A)(3) and 4(A)(4), on the last
 day of the Interest Period for such Portion, elect to fix the interest rate
 accruing on such Portion for another Interest Period pursuant to one of the
 fixed rate options. From time to time the Borrower may elect, on a Business
 Day prior to the expiration of the Interest Period for any Portion of the
 Loan accruing interest pursuant to a fixed rate option, and upon payment of
 the applicable Surcharge (as defined in, and calculated pursuant to, Section
 6 hereof) to convert all, but not part, of such Portion of the Loan so
 that it accrues interest at the Variable Rate or a combination of the
 Variable Rate and a fixed rate option, for a new Interest Period or Interest
 Periods selected in accordance with Subsections 4(A)(2), 4(A)(3)
 and 4(A)(4) of this Second Supplement. Except for the initial
 selection, all interest rate selections provided for herein shall be made by
 telephonic or written request of an authorized employee of the Borrower by
 12:00 noon, Central time, on the relevant day. In taking actions upon
 telephonic requests, CoBank shall be entitled to rely on (and shall incur no
 liability to the Borrower in acting upon) any request made by a person
 identifying himself or herself as one of the persons authorized by the
 Borrower to request the Loan or select interest rates hereunder so long as
 any funds advanced are wired to an account previously designated by the
 Borrower. Notwithstanding the foregoing,
 rates may not be fixed in such a manner as to cause the Borrower to have to
 break any fixed rate balance in order to pay any installment of principal.

	
 

	
 

	
 

	
          (6) Accrual of Interest. Interest shall
 accrue pursuant to the fixed rate options from and including the first day of
 the applicable Interest Period to but excluding the last day of the Interest
 Period. If the Borrower elects to refix the interest rate on any Portion of
 the Loan accruing interest pursuant to one of the fixed rate options pursuant
 to Subsection 4(A)(5) of this Second Supplement, the first day of the
 new Interest Period shall be the last day of the preceding Interest Period.
 In the absence of any such election, interest shall accrue on such Portion at
 the Variable Rate from and including the last day of such Interest Period. If
 the Borrower elects to convert from a fixed rate option to the Variable Rate
 option pursuant to Subsection 4(A)(5) upon payment of the applicable
 Surcharge as provided in Section 6, interest at the applicable fixed
 rate shall accrue 

4

Second
Supplement to the Master Loan Agreement/New Ulm Telecom, Inc.

Loan No.
RX0583-T2 

	
 

	
 

	
 

	
through the
 day before such conversion and either (i) the first day of any new Interest
 Period shall be the date of such conversion, or (ii) interest at the Variable
 Rate shall accrue on the Portion of the Loan so converted from and including
 the date of conversion. 

	
 

	
 

	
 

	
          (7) Interest Rate Protection. Commencing
 within 120 days of the Closing Date, the Borrower will, or will have caused
 Hutchinson (or its successors and assigns) to, have entered into or obtained,
 and Borrower will, or will cause Hutchinson (or its successors and assigns)
 to, maintain in full force and effect, (i) Interest Rate Agreements (as
 defined in Section 3 of the MLA) in form and substance reasonably
 satisfactory to CoBank on Portions of the Loans under this Second Supplement,
 and (ii) Portions of the Loan accruing interest pursuant to the Quoted Rate
 option, the effect of which shall be to fix interest rates payable by the
 Borrower or Hutchinson (or its successors and assigns) in the aggregate as to
 $20,000,000, the term of which Interest Rate Agreements or Interest Periods
 under the Quoted Rate option shall have a weighted average life of 3 years
 (determined using the initial term of such Interest Rate Agreements and
 Interest Periods under the Quoted Rate option). The Borrower will deliver to
 CoBank, promptly upon receipt thereof, copies of such Interest Rate
 Agreements (and any supplements or amendments thereto), and promptly upon
 request therefor, any other information reasonably requested by CoBank to
 evidence its compliance with the provisions of this Subsection 4(A)(7).
 

          (B) Margins. Initially, and continuing
through the day immediately preceding the first Adjustment Date (as hereinafter
defined in this Subsection 4(B)) occurring on or after March 31, 2008 on
which the Borrower demonstrates that a change in the LIBOR Margin is warranted
and requests such change, the applicable LIBOR Margin shall be 2.50%.
Commencing on such Adjustment Date, the LIBOR Margin shall be determined based
on the consolidated Total Leverage Ratio of the Borrower, determined in accordance
with Subsection 8(I)(1) of the MLA, on the last day of each fiscal quarter of
the Borrower, as set forth in the following table:

5

Second
Supplement to the Master Loan Agreement/New Ulm Telecom, Inc. 
Loan No.
RX0583-T2 

	
 

	
 

	
 

	
Consolidated
 Total Leverage Ratio

	
 

	
LIBOR Margin

	 

	
 

	 

	
 

	
 

	
 

	
Greater than
 or equal to 4.00:1.00

	
 

	
2.50%

	
 

	
 

	
 

	
Less than
 4.00:1.00 and greater than or equal to 3.50:1.00

	
 

	
2.25%

	
 

	
 

	
 

	
Less than
 3.50:1.00 and greater than or equal to 3.00:1.00

	
 

	
2.00%

	
 

	
 

	
 

	
Less than
 3.00:1.00 and greater than or equal to 2.50:1.00

	
 

	
1.75%

	
 

	
 

	
 

	
Less than
 2.50:1.00

	
 

	
1.50%

The LIBOR
Margin shall be (i) increased, if warranted, beginning on the date which is the
fifth Business Day following CoBank’s receipt of the financial statements
required pursuant to Subsections 8(H)(1) and 8(H)(2) of the MLA, and the
compliance certificate required pursuant to Subsection 8(H)(9) of the MLA and
(ii) decreased, if warranted, beginning on the date which is the fifth Business
Day following CoBank’s receipt of such financial statements and compliance
certificate and the Borrower’s written request to decrease such margin (each
such date described in (i) and (ii), an “Adjustment
Date”). In the event that CoBank shall not receive when due such
financial statements and compliance certificate, then from such due date and
until the fifth Business Day following CoBank’s receipt of such overdue
financial statements and compliance certificate (and in the event a decrease in
the applicable margin is then warranted, receipt of the Borrower’s written
request to decrease such margin), or upon the occurrence of any Event of
Default, then at the option of CoBank the LIBOR Margin shall be 2.50%. 

          (C) Payment and Calculation. The Borrower
shall pay interest on the Loan monthly in arrears on the 20th day (or such
other day as CoBank shall elect in writing) of each month, upon any prepayment
of a fixed rate Portion (whether due to acceleration or otherwise) and on the
Maturity Date; provided, however, at the election of CoBank with
respect to the Portions accruing interest under the LIBOR option, rather than
on a monthly basis interest shall be payable at the maturity of an Interest
Period, or, if such Interest Period exceeds three months, in arrears on each
three-month anniversary of the beginning date of such Interest Period and at
the maturity of such Portion and upon any prepayment (whether due to
acceleration or otherwise). Interest shall be calculated on the actual number
of days the Loan, or any part thereof, is outstanding on the basis of a year
consisting of 360 days. In calculating accrued interest, the date the Loan is
made shall be included and the date any principal amount of the Loan is repaid
or prepaid shall be excluded as to such amount. If any date for the payment of 

6

Second
Supplement to the Master Loan Agreement/New Ulm Telecom, Inc. 
Loan No.
RX0583-T2 

interest is
not a Business Day, then the interest payment then due shall be paid on the
next Business Day. 

          SECTION 5. Commitment Fee. In consideration
of the Commitment, the Borrower shall pay to CoBank a commitment fee on the
average daily unused portion of the Commitment at a rate of 0.25% per annum
(calculated on the basis of the actual number of days elapsed and a year
consisting of 360 days), payable quarterly in arrears on the 20th day of the
month following such quarter end and upon the Maturity Date. Such fee shall be
payable for each quarter (or portion thereof) occurring during the original or
any extended term of the Commitment. 

          SECTION 6. Repayment, Prepayment and Surcharge.
The Borrower may, (i) on any Business Day, prepay in full or in part any
Portion of the Loan accruing interest at the Variable Rate option, and (ii) on
three Business Days’ prior, irrevocable written notice, prepay in full or in
part any Portion of the Loan accruing interest pursuant to a fixed rate option.
Notwithstanding the foregoing, the Borrower’s right to prepay any amount
accruing interest pursuant to a fixed rate option shall be conditioned upon the
payment of a prepayment Surcharge as defined and calculated below. For purposes
of calculating the Surcharge provided for in this Section 6, early conversion
of a Portion of the Loan accruing interest pursuant to a fixed rate option so
that it accrues interest at a different rate pursuant to Subsection 4(A)(5) shall be deemed a
prepayment in full of that Portion of the Loan. Upon any such early conversion,
any repayment required hereunder or under the MLA, any prepayment of any
Portion of the Loan accruing interest pursuant to a fixed rate option, and as a
condition to any voluntary prepayment (whether such conversion, repayment,
prepayment or payment is made voluntarily, as a result of an acceleration, or
otherwise), the Borrower shall pay to CoBank, on the date of such repayment,
prepayment, payment or early conversion, a surcharge (“Surcharge”) in an amount equal to the
greater of (i) $300 and (ii) the present value of any funding losses incurred
or imputed by CoBank to have been incurred as a result of such repayment,
prepayment, payment or conversion for the period such amount was scheduled to
have been outstanding at such fixed rate (which, if less than $0, shall be
deemed to be $0), plus, in the case of the repayment, prepayment, payment or
conversion of any Portion of the Loan accruing interest pursuant to the Quoted
Rate option, an amount equal to 0.5% of the amount repaid, prepaid or
converted. Such Surcharge, including the amount of any funding losses incurred
by CoBank, shall be determined and calculated in accordance with methodology
established by CoBank.  

          SECTION 7. Repayment. The outstanding
principal balance of the Loan, together with accrued interest thereon and all
other amounts due and owing hereunder and under the other Loan Documents
relating to the Loan or the Commitment, shall be due and payable on the
Maturity Date. 

7

Second
Supplement to the Master Loan Agreement/New Ulm Telecom, Inc.
 Loan No.
RX0583-T2 

          SECTION 8. Security. The Loan is secured
and guaranteed by (i) that certain Mortgage and Security Agreement and Fixture
Financing Statement, dated on or about the date hereof, made by the Borrower in
favor of CoBank (as the same may be amended, modified, supplemented, extended
or restated from time to time, the “Mortgage”)
pursuant to which the Borrower has granted to CoBank a first-priority lien on
substantially all of its now owned or hereafter acquired real property; (ii)
that certain Security Agreement, dated as of even date herewith, made by the
Borrower in favor of CoBank (as the same may be amended, modified,
supplemented, extended or restated from time to time, the “Security Agreement”), pursuant to which
the Borrower has granted to CoBank a first-priority security interest in
substantially all of its now owned or hereafter acquired tangible and
intangible personal property; (iii) that certain Stock Pledge Agreement, dated
as of even date herewith, made by the Borrower in favor of CoBank (as the same
may be amended, modified, supplemented, extended or restated from time to time,
the “Pledge Agreement”),
pursuant to which the Borrower has pledged to CoBank on a first-priority basis
all now owned or hereafter acquired capital stock or voting securities of any
entity of which the Borrower now owns or hereafter acquires 25% or more of the
issued and outstanding capital stock or voting securities (excluding its
membership interest in EN-TEL Communications, LLC); and (iv) that certain
Continuing Guaranty, dated as of even date herewith, made by the Borrower,
Western Telephone Company (“WTC”),
Peoples Telephone Company (“PTC”),
New Ulm Phonery, Inc. (“Phonery”),
New Ulm Cellular #9, Inc. (“Cellular”),
New Ulm Long Distance, Inc. (“Long
Distance”), Hutchinson Telephone Company (“Hutchinson I”), Hutchinson Cellular,
Inc. (“Hutchinson II”) and
Hutchinson Telecommunications, Inc. (“Hutchinson
III”) (each, excluding the Borrower, a “Loan Party Guarantor”
and collectively, the “Loan Party
Guarantors”) in favor of CoBank (as the same may be amended,
modified, supplemented, extended or restated from time to time, the “Guaranty”).  

The Guaranty
is secured by (i) those certain Security Agreements, each dated as of even date
herewith, and each made by such Loan Party Guarantor for the benefit of CoBank
(as the same may be amended, modified, supplemented, extended or restated from
time to time, individually, a “Guarantor
Security Agreement” and collectively, the “Guarantor Security Agreements”),
pursuant to which such Loan Party Guarantor has granted to CoBank a
first-priority lien and security interest in substantially all of its now owned
or hereafter acquired personal property, (ii) those certain Mortgage and
Security Agreements and Fixture Financing Statements, each made by such Loan
Party Guarantor in favor of CoBank (as the same may be amended, modified,
supplemented, extended or restated from time to time, individually, a “Guarantor Mortgage” and collectively,
the “Guarantor Mortgages”)
pursuant to which such Loan Party Guarantor has granted to CoBank a
first-priority lien on all of its now owned or hereafter acquired real
property; (iii) that certain Stock Pledge Agreement, dated as of the date
herewith, made by Hutchinson I in favor of CoBank (as the same may be amended,
modified, supplemented, extended or restated from time to time, the “Hutchinson I Stock Pledge Agreement”),
pursuant 

8

Second
Supplement to the Master Loan Agreement/New Ulm Telecom, Inc.
 Loan No.
RX0583-T2 

to which
Hutchinson I has pledged to CoBank on a first-priority basis all now owned or
hereafter acquired capital stock or voting securities of any entity of which
Hutchinson I now owns or hereafter acquires 25% or more of the issued and
outstanding capital stock or voting securities; (iv) and that certain Stock
Pledge Agreement, dated as of the date herewith, made by Hutchinson II in favor
of CoBank (as the same may be amended, modified, supplemented, extended or
restated from time to time, the “Hutchinson
II Stock Pledge Agreement”), pursuant to which Hutchinson II has
pledged to CoBank on a first-priority basis all now owned or hereafter acquired
capital stock or voting securities of any entity of which Hutchinson II now
owns or hereafter acquires 25% or more of the issued and outstanding capital
stock or voting securities (excluding its membership interests in Direct
Communications, LLC, Page-All, LLC, and SHAL, LLC and except as otherwise
agreed to in writing by CoBank). 

The Borrower
agrees, and agrees to cause each Loan Party, to take such steps, including,
without limitation, the execution and filing and recordation of security
agreements, financing statements, irrevocable stock power and collateral
assignments, and amendments to any of the foregoing, including, without
limitation, those certain Deposit Account Control Agreements, each dated as of
even date herewith, and each by the Borrower, WTC, PTC or Hutchinson I, as
applicable, the financial institution identified therein and CoBank, and such
other instruments and documents as CoBank may from time to time reasonably
require to enable CoBank to obtain, perfect and maintain its security interests
in such property and the payment of any applicable documentary stamp or similar
taxes. Furthermore, the Borrower agrees, and agrees to cause each Loan Party,
to take such steps, including the execution and recordation and filing of any
mortgage agreements, or any fixture filings, and amendments to the foregoing,
and such other instruments and documents, as CoBank may request from time to
time to enable CoBank to obtain, perfect, and maintain a lien on any real
property interests of such entity as CoBank shall determine in its reasonable
discretion, and the payment of any applicable mortgage recording tax,
documentary stamp taxes or similar taxes. 

          SECTION 9. Additional Conditions Precedent.

          (A) Conditions to Initial Advance. In
addition to the conditions precedent set forth in the MLA and in Subsection
9(B), CoBank’s obligation to make the initial advance under the Loan is subject
to the satisfaction of each of the following conditions precedent on or before
the date of such advance:  

	
 

	
 

	
 

	
          (1)
Capital Contribution to CoBank. That the Borrower has acquired participation
certificates in CoBank in an initial amount of $1,000;  

9

Second
Supplement to the Master Loan Agreement/New Ulm Telecom, Inc.
 Loan No.
RX0583-T2 

	
 

	
 

	
 

	
          (2) Closing of Term Loan. That all
 conditions precedent to the First Supplement to the Master Loan Agreement,
 dated as of even date herewith, have been satisfied; 

	
 

	
 

	
 

	
          (3) Closing of Hutchinson Loan. That all conditions
 precedent to the Hutchinson Loan have been satisfied; 

	
 

	
 

	
 

	
          (4) Consummation of Acquisition. That
 CoBank receive evidence satisfactory to it that the Merger is being
 consummated concurrently herewith on terms and conditions substantially
 consistent with that certain Agreement and Plan of Merger, dated as of August
 3, 2007, as amended; and 

	
 

	
 

	
 

	
          (5) Opinions. That CoBank receive, in
 form and content reasonably acceptable to CoBank, opinions of counsel (who
 shall be reasonably acceptable to CoBank) for each Loan Party. 

          (B) Conditions to Each Advance. In addition
to the conditions precedent set forth in the MLA, CoBank’s obligation to make
any advance under the Loan, including the initial advance, is subject to the
satisfaction of each of the following conditions precedent on or before the
date of such advance: 

	
 

	
 

	
 

	
          (1) No Material Adverse Change. That from
 December 31, 2006 to the date of the Loan there has not occurred any event
 which has had or could reasonably be expected to have a Material Adverse
 Effect on the business or prospects of any Loan Party; 

	
 

	
 

	
 

	
          (2) Representations and Warranties. That
 the representations and warranties of each Loan Party contained in the MLA,
 this Second Supplement and any other Loan Document to which they are party be
 true and correct in all material respects on and as of the date of the Loan,
 as though made on and as of such date; 

	
 

	
 

	
 

	
          (3) Advance Certificate. That CoBank
receive a certificate, in the form of Exhibit A attached hereto, dated as of
the Closing Date, from the President of the Borrower as to, among other
things, the continuing truth and accuracy of the representations and
warranties of each Loan Party under the Loan Documents to which it is a party
and the satisfaction of each of the conditions applicable to the making of
the Loan; and  

10

Second
Supplement to the Master Loan Agreement/New Ulm Telecom, Inc. 
Loan No.
RX0583-T2 

	
 

	
 

	
 

	
          (4) Other Information. That CoBank
 receive such other information regarding the condition, financial or
 otherwise, and operations of each Loan Party as CoBank shall request and such
 other opinions, certificates or documents as CoBank shall reasonably request.
 

[Signatures Follow on Next Page]

11

Second
Supplement to the Master Loan Agreement/New Ulm Telecom, Inc.
 Loan No.
RX0583-T2 

          IN WITNESS WHEREOF, the Borrower has caused
this Agreement to be executed and delivered, and CoBank has caused this
Agreement to be executed and delivered, each by its respective duly authorized
officer as of the date first shown above. 

	
 

	
 

	
 

	
 

	
NEW ULM TELECOM, INC.

	
 

	
 

	
 

	
 

	
By: 

	
/s/ Nancy
 Blankenhagen

	
 

	
 

	

	
 

	
 

	
Name: Nancy
 Blankenhagen

	
 

	
 

	
Title: Chief
 Financial Officer

[Signatures Continue on Next Page]

Second
Supplement to the Master Loan Agreement/New Ulm Telecom, Inc. 
Loan No.
RX0583-T2 

[Signatures Continued from Previous Page]

	
 

	
 

	
 

	
 

	
COBANK, ACB

	
 

	
 

	
 

	
 

	
By:

	
/s/ Roger Opp

	
 

	
 

	

	
 

	
 

	
Roger Opp

	
 

	
 

	
Vice
 President

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