Document:

Exhibit 10.1 to New Ulm Telecom, Inc. Form 10-Q for quarterly period ended September 30, 2009

EXHIBIT 10.1

September 14, 2009

New Ulm
Telecom, Inc.

Hutchinson Telephone Company

400 Second Street North

P.O. Box 697

New Ulm, Minnesota 56073-0697

James T. Sanft

Lindquist & Vennum, P.L.L.P

4200 IDS Center

80 South Eighth Street

Minneapolis, Minnesota 55402

	
  

 	
  

 	
  

 
	
  

 	
 Re:

 	
 Waiver,
 Release and Amendment

 

Ladies and
Gentlemen:

          Reference
is made to the Master Loan Agreement, dated as of January 4, 2008, by and
between New Ulm Telecom, Inc. (“New Ulm”)
and CoBank, ACB, (“CoBank”)
(as the same may be amended, modified, supplemented, extended or restated from
time to time, the “New Ulm MLA”),
as supplemented by that certain First Supplement to the Master Loan Agreement,
dated as of January 4, 2008, by and between New Ulm and CoBank (as the same may
be amended, modified, supplemented, extended or restated from time to time, the
“New Ulm First Supplement”)
and by that certain Second Supplement to the Master Loan Agreement, dated as of
January 4, 2008, by and between New Ulm and CoBank (as the same may be amended,
modified, supplemented, extended or restated from time to time, the “New Ulm Second Supplement”; the New Ulm
MLA as supplemented by the New Ulm First Supplement and the New Ulm Second
Supplement, collectively, the “New Ulm
Loan Agreement”). 

          Reference
is further made to the Master Loan Agreement, dated as of January 4, 2008, by
and between Hutchinson Acquisition Corp. (“Hutchinson
Acquisition”) and CoBank (as the same may be amended, modified,
supplemented, extended or restated from time to time, the “Hutchinson MLA”), as supplemented by
that certain First Supplement to the Master Loan Agreement, dated as of January
4, 2008, by and between Hutchinson and CoBank (as the same may be amended,
modified, supplemented, extended or restated from time to time, the “Hutchinson First Supplement”), by that
certain Second Supplement to the Master Loan Agreement, dated as of January 4,
2008, by and between Hutchinson and CoBank (as the same may be amended,
modified, supplemented, extended or restated from time to time, the “Hutchinson Second Supplement”) and by
that certain Third Supplement to the Master Loan Agreement, dated as of January
4, 2008, by and between Hutchinson and CoBank (as the same may be amended,
modified, supplemented, extended or restated from time to time, the “Hutchinson Third Supplement”; the
Hutchinson MLA as supplemented by the Hutchinson First Supplement, the
Hutchinson Second Supplement and the Hutchinson Third Supplement, collectively,
the “Hutchinson Loan Agreement”;
and together with the New Ulm Loan Agreement, the “Loan Agreements”). Immediately upon the
closing of the Hutchinson Loan Agreement, Hutchinson Acquisition merged with and into Hutchinson Telephone Company
(“Hutchinson Telephone”; and together with New Ulm, the “Borrowers”), with Hutchinson Telephone being the
survivor of such merger and having all rights and obligations of Hutchinson
Acquisition pursuant to the terms of the Hutchinson Loan Agreement.

42

Reference is also made to that certain letter agreement regarding consent
and waiver, dated as of March 17, 2009, by and among CoBank, the Borrowers and
the Guarantors (as the same may be amended, modified, supplemented, extended or
restated from time to time, the “March
Letter Agreement”). 

Capitalized terms used and not otherwise defined in this letter
agreement shall have the meanings assigned to them in the Loan Agreements. 

Waiver

          Pursuant to
Subsection 9(E) of the New Ulm First Supplement and Subsection 9(E) of the
Hutchinson First Supplement, as modified by the March Letter Agreement, New Ulm
and Hutchinson Telephone, respectively, must deliver or cause to be delivered
to CoBank, on or before December 31, 2009, a membership interest pledge
agreement by which Hutchinson Cellular, Inc. would grant to CoBank a
first-priority security interest in all of its then-owned and
thereafter-acquired ownership interest in SHAL, LLC (the “SHAL Pledge”). The Borrowers have
advised CoBank that Hutchinson Cellular, Inc. intends to sell its ownership
interest in SHAL, LLC, and have requested that CoBank waive the SHAL Pledge. In
reliance on the representations and warranties of the Loan Parties in this
letter agreement and in connection with the request for such waiver, and
subject to the effectiveness of this letter agreement as described below,
CoBank hereby waives the SHAL Pledge.

Release

          The
Borrowers have advised CoBank that Hutchinson Cellular, Inc. intends to sell
its ownership interest in SHAL, LLC and SHAL Network, Inc., Direct
Communications, LLC and Hutchinson Telephone intends to sell its ownership
interest in En-Tel Communications, LLC. The Borrowers have requested that, to
the extent CoBank has a lien upon and security interest in the ownership
interests of SHAL, LLC, SHAL Network, Inc., Direct Communications, LLC and
En-Tel Communications, LLC, CoBank release such lien and security interest. 

          In reliance
on the representations and warranties of the Loan Parties in this letter
agreement and in connection with the request for such release, and subject to
the effectiveness of this letter agreement as described below, to the extent
CoBank has a lien upon and security interest in the ownership interests of
SHAL, LLC, SHAL Network, Inc., Direct Communications, LLC and En-Tel
Communications, LLC, CoBank hereby releases such lien and security interest.

43

Amendment

          Upon the
effectiveness of this letter agreement, Schedules 7(S) and 9(F) of the Loan
Agreements will be deemed amended to delete therefrom (i) the ownership
interests of SHAL, LLC, SHAL Network, Inc. and En-Tel Communications, LLC, and
Direct Communications LLC and (ii) any guaranty by any Loan Party on behalf of
any of SHAL, LLC, SHAL Network, Inc. or En-Tel Communications, LLC. 

          Upon the
effectiveness of this letter agreement, clause (iii) of Subsection 9(E) shall
be amended and restated to read as follows:

                    (iii)
those Investments described in clauses (iii) through (iv) of Subsection
9(F), which are marketable, for fair market value;

General

          Except as
expressly provided by this letter agreement, the terms and provisions of the
Loan Agreements and the other Loan Documents are hereby ratified and confirmed
and shall continue in full force and effect. The waiver, release and amendment
provided herein are to be effective only upon receipt by CoBank of an execution
counterpart of this letter agreement signed by each of the Loan Parties, and
such waiver, release and amendment are conditioned upon the correctness of all
representations and warranties made by the Loan Parties in this letter
agreement and as provided to CoBank in connection with the request for such
waiver, release and amendment. The waiver, release and amendment contained
herein shall not constitute a course of dealing between any of the Loan Parties
and CoBank and, except as expressly set forth herein, shall not constitute a
waiver, extension or forbearance of any Potential Default or Event of Default,
now or hereafter arising, or an amendment of any provision of the Loan
Agreements or the other Loan Documents. The Loan Parties agree to pay to
CoBank, on demand, in immediately available funds, all out-of-pocket costs and
expenses incurred by CoBank, including, without limitation, the reasonable fees
and expenses of counsel retained by CoBank, in connection with the negotiation,
preparation, execution and delivery of this letter agreement and all other
instruments and documents contemplated hereby. This letter agreement shall be
governed by, construed and enforced in accordance with all provisions of the
Loan Agreements and may be executed in multiple counterparts.

Reaffirmation

          By its
execution hereof, each of the Guarantors hereby consents and agrees to the
terms and provisions of this letter agreement and consents and agrees that the
Guaranty, Guarantor Security Agreement, and all other Loan Documents executed
by such Guarantor (or its predecessor) remain in full force and effect and
continue to be the legal, valid and binding obligation of it, enforceable
against it, in accordance with the terms thereof. 

[Signatures begin on next page.]

44

          Please
evidence your acknowledgment of receipt of the foregoing and your agreement by
executing this letter agreement in the place indicated below and returning it
to CoBank.

	
  

 	
  

 	
  

 
	
  

 	
 Sincerely,

 
	
  

 	
  

 	
  

 
	
  

 	
 COBANK, ACB

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
    /s/ Roger
 Opp

 
	
  

 	
  Name:  Roger Opp

 
	
  

 	
  Title:    Vice
 President

 

Acknowledged
and agreed to:

NEW ULM TELECOM,
INC., 

as a Borrower and a Guarantor

	
  

 	
  

 
	
 By:

 	
    /s/ Nancy
 Blankenhagen

 

	
  

 	
  

 	
  

 
	
  

 	
  Name:

 	
 Nancy
 Blankenhagen

 
	
  

 	
  Title:

 	
 Chief
 Financial Officer

 

HUTCHINSON TELEPHONE
COMPANY, 

as successor by merger to Hutchinson Acquisition 

Corp., as a Borrower and a Guarantor

	
  

 	
  

 
	
 By:

 	
    /s/ Nancy
 Blankenhagen

 

	
  

 	
  

 	
  

 
	
  

 	
  Name:

 	
 Nancy
 Blankenhagen

 
	
  

 	
  Title:

 	
 Chief
 Financial Officer

 

NEW ULM LONG
DISTANCE, INC.,

as a Guarantor

	
  

 	
  

 
	
 By:

 	
    /s/ Nancy
 Blankenhagen

 

	
  

 	
  

 	
  

 
	
  

 	
  Name:

 	
 Nancy
 Blankenhagen

 
	
  

 	
  Title:

 	
 Chief
 Financial Officer

 

[Signatures Continue on Following Page]

45

[Signatures Continued From Previous Page]

NEW ULM CELLULAR #9,
INC.,

as a Guarantor

	
  

 	
  

 
	
 By:

 	
    /s/ Nancy
 Blankenhagen

 

	
  

 	
  

 	
  

 
	
  

 	
  Name:

 	
 Nancy
 Blankenhagen

 
	
  

 	
  Title:

 	
 Chief
 Financial Officer

 

NEW ULM PHONERY,
INC., 

as a Guarantor

	
  

 	
  

 
	
 By:

 	
    /s/ Nancy
 Blankenhagen

 

	
  

 	
  

 	
  

 
	
  

 	
  Name:

 	
 Nancy
 Blankenhagen

 
	
  

 	
  Title:

 	
 Chief
 Financial Officer

 

PEOPLES TELEPHONE COMPANY,

as a Guarantor

	
  

 	
  

 
	
 By:

 	
    /s/ Nancy
 Blankenhagen

 

	
  

 	
  

 	
  

 
	
  

 	
  Name:

 	
 Nancy
 Blankenhagen

 
	
  

 	
  Title:

 	
 Chief
 Financial Officer

 

[Signatures Continue on Following Page]

46

[Signatures Continued from Previous Page]

WESTERN TELEPHONE
COMPANY, 

as a Guarantor

	
  

 	
  

 
	
 By:

 	
    /s/ Nancy
 Blankenhagen

 

	
  

 	
  

 	
  

 
	
  

 	
  Name:

 	
 Nancy
 Blankenhagen

 
	
  

 	
  Title:

 	
 Chief
 Financial Officer

 

HUTCHINSON
TELECOMMUNICATIONS, INC., 

as a Guarantor

	
  

 	
  

 
	
 By:

 	
    /s/ Nancy
 Blankenhagen

 

	
  

 	
  

 	
  

 
	
  

 	
  Name:

 	
 Nancy
 Blankenhagen

 
	
  

 	
  Title:

 	
 Chief
 Financial Officer

 

HUTCHINSON CELLULAR,
INC., 

as a Guarantor

	
  

 	
  

 
	
 By:

 	
    /s/ Nancy
 Blankenhagen

 

	
  

 	
  

 	
  

 
	
  

 	
  Name:

 	
 Nancy
 Blankenhagen

 
	
  

 	
  Title:

 	
 Chief
 Financial Officer

 

47ex10_a.htm

Exhibit 10.a

 

AMENDED

FORM OF WAIVER

[Company Letterhead]

[Date]

[Name of officer]

[Address]

Dear [Officer]:

First Bancorp, a North Carolina corporation (together with its subsidiaries, the “Company”), is a participant in the Capital Purchase Program (the “Program”) established by the U.S. Department
of the Treasury (the “Treasury”) pursuant to the Emergency Economic Stabilization Act of 2008, as amended by the American Recovery and Reinvestment Act of 2009 (“EESA”).   As a condition to the Company participating in the Program, the Company is required, among other things, to agree to adhere to certain provisions regarding compensation paid
by the Company to certain employees, which may include you.  The purpose of this letter agreement is to confirm your agreement to accept the restrictions established by EESA on your compensation, to the extent these restrictions are applicable to you.  This letter agreement replaces in its entirety any prior agreement between you and the Company related to the Program.

By executing this letter agreement, and in consideration of the benefits you will receive as a result of the Company’s participation in the Program:

	
  
	
1.
	
You hereby renounce and forever waive any right or entitlement to receive from the Company any cash and non-cash consideration, including any bonuses or other forms of compensation, pursuant to any agreement, plan or arrangement between you and the Company, whether or not in writing, if the payment or accrual by the Company of any such compensation would violate the provisions of Section 111(b) of EESA and the rules
and regulations adopted thereunder, including but not limited to the TARP Standards for Compensation and Corporate Governance published on June 15, 2009 as 31 CFR Part 30 (the “TARP Standards”).  Without limiting the effect of the preceding sentence, you acknowledge that Section 111(b) of EESA and the TARP Standards expressly prohibit the Company, among other things, from paying any (a)
cash bonus to certain employees, subject to certain exceptions, (b) severance (or “golden parachute”) payments in connection with the departure of certain employees and (c) tax gross-up payments to certain employees.

	
  
	
2.
	
You hereby agree to return to the Company, promptly upon demand, any bonus, retention award or incentive compensation paid to you based on statements of earnings, gains or other criteria that are later found to be materially inaccurate, to the extent required by Section 111(b) of EESA and the rules and regulations adopted thereunder, including but not limited to the TARP Standards.

	
  
	
3.
	
You hereby acknowledge that in accordance with Section 111(b) of EESA and the rules and regulations adopted thereunder, including but not limited to the TARP Standards, the Company’s compensation committee is required periodically to review the Company’s incentive compensation arrangements with its senior risk officers (or other personnel acting in a similar capacity) to ensure that these arrangements do
not encourage employees to take unnecessary and excessive risks that threaten the value of the Company.  Notwithstanding any prior agreement between you and the Company, you hereby agree to accept any changes made by the Company to its incentive compensation arrangements as a result of these periodic reviews.

	
  
	
4.
	
You hereby acknowledge that this agreement shall remain in effect so long as the Company is a participant in the Program or is subject to EESA and the rules and regulations adopted thereunder.

You acknowledge that the Company is relying on your agreements contained herein to maintain its eligibility to participate in the Program. This letter agreement expressly amends any inconsistent provisions contained in any employment or other agreement between you and the Company or in any compensatory plan or program
maintained by the Company.  To the extent not subject to federal law, this letter agreement will be governed by and construed in accordance with the laws of the State of North Carolina.  This letter agreement may be executed in two or more counterparts, each of which will be deemed an original.  A signature transmittal by facsimile or other electronic device will be deemed an original signature.

  

  

  

Please confirm your agreement to the foregoing by signing a copy of this letter where indicated below and returning one fully-executed copy of this letter to us.

	  	
Sincerely,

	  	  
	  	
First Bancorp

Agreed and Accepted as of

the date set forth above:

_____________________________

Name: [Name of Officer Typed Here]

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